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Sacramento Estate Planning Attorney

Sacramento Estate Planning Blog

Estate planning and the qualified disclaimer

The recent passing of former President, George H. W. Bush, has left many Californians heartbroken. One reason is because he appeared to suffer from what some call the "broken heart syndrome." This is because former President Bush passed away just a mere eight months after his wife Barbara Bush. As sad as these types of events can be, it can also be informative, especially when looking at estate planning. After all, many families find themselves in a position where a couple, or two parents, pass away in relatively quick succession.

So, how should assets be handled in these situations? It depends on the facts at hand. However, one option is for spouses to create a qualified disclaimer as part of their estate plan. A qualified disclaimer is a written and signed statement whereby an individual essentially refuses to accept any gift from another, including an inheritance. So, if one spouse passes away and leaves assets to his or her spouse, and that spouse has a qualified disclaimer, then the assets will not pass to the second spouse. Instead, they will proceed down the succession chain to the couple's children or other qualified beneficiaries.

Stan Lee's estate planning issues

By engaging in California estate planning, individuals can ensure that they retain control over their assets for a significant period of time after their passing. This requires the utilization of many legal documents, but failing to do so can result in unwanted consequences. Although many believe that estate planning is only for the rich and famous, this is not the case. In fact, just about anyone can benefit from competent estate planning. Yet, looking at estate planning issues that affect celebrities can be illustrative for even common folk.

Just take the case of Stan Lee. Lee, the creator of much of the Marvel universe, recently passed away at the age of 95. The months leading up to his death were riddled with scandal. Reports indicated that his 68-year-old daughter had been trying to take advantage of him. There were even some allegations that a significant amount of money went missing from his estate during this time and that he was being abused.

Will contests and no-contest clauses

Devising a will can either be relatively simple or it can be extraordinarily difficult depending on the circumstances at hand. This can include the number of assets and debts involved, the number of identified heirs and the complexities involved in the way that an individual intends to leave his or her estate via a will. Regardless of how in-depth a will needs to be though, an individual needs to ensure that it is crafted with clarity and thoroughness. Failing to do so could lead to a contested will.

A contested will can be costly to an estate and it can create an enormous amount of familial tension. Generally speaking, an individual named in a will or someone who would have received assets if the individual in question had passed away without a will can seek to contest a will. This usually means that close family members and named heirs can challenge a provision of a will, or even its entirety. Such a contest can threaten to undermine the way in which one's estate is passed down.

Abatement, ademption and other estate planning lingo

Like a lot of areas of the law, estate planning to some extent has developed its own lingo to describe various rules and concepts quickly and efficiently.

It is important for those who are in the midst of estate planning to understand what some of these terms mean and how the concepts they signify can affect one's estate plan. If a Sacramento resident does not fully understand a term he hears, he should ask an estate planning attorney.

California firm can assist with comprehensive estate planning

Last week on this blog, we talked about estate planning as it relates to hard assets, such as family heirlooms. Finding a satisfactory way to deal with this issue can be challenging, especially when multiple family members are hoping to inherit a specific piece of property. Yet, dealing with hard assets is just a small piece of the estate planning puzzle.

There are multiple considerations that must be made to complete a holistic and effective estate plan. While one must of course deal with the future distribution of liquid assets like cash, stocks and bonds, he or she must also think about his or her potential need for long-term care, assistance with handling healthcare and financial decisions in the event of incapacitation and the restrictions he or she wants to place on the distribution of assets.

Ways to deal with hard assets in your estate plan

Figuring out how to divide assets is one of the hardest parts of estate planning. Many Californians choose to split an estate equally amongst loved ones, but even this can become challenging. Whereas assets like cash, stocks and bonds are easy to value and then divide, other assets, like family heirlooms are much more difficult to address. Yet, there are certain steps to help work through this process and ensure that hard assets are distributed in accordance with one's wishes.

The first step is to know the true value of an asset. Items like jewelry and artwork can have fluctuating values depending on their respective markets though, so it is important to have a recent appraisal. Then, the recent value can utilize that figure in estate planning. When getting an asset appraised, also ensure that the person valuating it is experienced and, if appropriate, certified. This will help ensure accuracy and validity of the asset's estimated value.

Tips on how to talk to loved ones about estate planning

California estate planning can be a difficult topic to contemplate, let alone discuss with loved ones. Many think that looping beloved family members into the conversation about estate planning can further family transparency and leave everyone feeling better. But, sometimes, communications do not go as planned. When this happens, arguments can ensue and feelings can be hurt. In short, bad communication may throw estate planning off the tracks.

That being said, there are certain steps to help ease into a discussion about estate planning in a way that avoids confrontation. To start, it may help to gradually shift family discussion to include estate planning issues. Bringing this topic up seemingly out of nowhere can be a shock to family member, causing them to react to it rather than approaching it with thoughtful consideration.

What is a conservatorship in California?

Many people put off estate planning because they are afraid to confront the thought of their own mortality. Next to death, when it comes to aging, people usually fear declining health. Yet, the sad reality is that many Californians will see their health significantly deteriorate as they age. There may even come a point where their medical condition leaves them unable to make important financial and healthcare decisions on their own. Under these circumstances, an individual may be deemed incapacitated, and a guardianship may be created to protect him or her.

Adult guardianship, also known as conservatorship, is the process through which an individual is given the responsibility of caring for the financial matters of an incapacitated individual. Once a conservator is named, that individual will be required to post a bond. The purpose of this bond is to reimburse the incapacitated individual in the event that his or her assets are mismanaged. Then, within 90 days of the creation of the conservatorship, the appointed individual must submit to the court an inventory of the incapacitated individual's assets as well as a plan for how to manage the incapacitated individual's affairs.

When should I consider changing my will?

Life is full of changes. Some of them are planned for, but others are unexpected, as is often the case with the birth of a child. Other matters can also seemingly come out of the blue, such as spur-of-the-moment marriage or divorce. While these changes can certainly have a meaningful effect on one's day-to-day life, they can also have long-term consequences. This is especially true when it comes to estate planning. In this context, these changes can affect how assets will be distributed and to whom.

This is why it is critical to update one's California estate planning documents from time-to-time, including the will. There are many life events that can justify a will modification. If after the creation of a will, for example, one finds themselves committed to a long-term partner, then they may want to add him or her to the will since marriage protections will not be in place to ensure that he or she receives any assets. The same situation can play out after the birth of a child or a grandchild.

Attorneys utilizing trusts to meet estate planning goals

Last week on the blog we discussed the estate of famed movie star Burt Reynolds and how he utilized a trust to protect his assets for his son. Although it may seem a bit unconventional to write someone out of your will like Burt Reynolds did to his son, it can serve a purpose. In fact, there are a number of decisions you can make during the estate planning process to protect yourself, your assets, and your heirs and beneficiaries.

This customization is a true benefit of estate planning. While many people turn to the standard options such as creating a simple will, your planning doesn't have to end there. Instead, you can utilize trusts as a way to ensure that your assets provide a charitable benefit, provide long-term security for your loved ones, and/or avoid taxes and the reach of creditors. You can even set up a trust to ensure that your pet is well cared for after you are gone.

My Sacramento law practice, Michael A. Sawamura, Attorney at Law, focuses on wills, trusts and estate planning law in addition to business law and corporate defense services. My clients include professionals, government employees, small businesses, blue-collar workers and national corporations.

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