In my experience as a Charlotte trust attorney, I’ve actually found that the best place to start is by going through the general qualities that a trust administrator should possess.  From there, you can think through your list of family and friends and choose someone whose personality and financial savvy make them the right fit for the job.

1. Trustworthy

One of the most important qualifications (in my opinion of course) is trustworthiness.   This is an essential requirement, considering your administrator will be privy to all your financial information and will manage your estate upon your passing.  You should feel confident knowing that your administrator will distribute your assets and manage your affairs as you’ve indicated, rather than use the proceeds of your estate as if it were their own personal bank account.  Thankfully, there are a number of laws intended to keep this type of financial abuse in check, but it still does happen and it’s hard to recover the proceeds of someone’s estate once they are gone.

2. Fair-minded

Fair-mindedness is another trait a trust administrator should possess. Throughout the administration process, you’ll want your beneficiaries to be treated fairly and equally.  You don’t want to run into a situation where someone you’ve appointed shows favoritism towards certain family members and distributes your assets accordingly.

3. Loyal

…to the trust and to the heirs. In a way, he or she is the keeper of the final wishes, and part of their job is ensuring that these wishes are carried out as set forth in the will or trust.

4. Strong-minded

Finally, you’ll want to choose an administrator who is strong-minded and cool under pressure. Following the death of a loved one, emotions can run high among the heirs. A favorite gravy boat can take on epic proportions when everyone thinks it should go to them. Sometimes greedy beneficiaries believe their share is short. Other times, heirs think they should be getting their money immediately, either not realizing (or caring) that debts, liens, and other considerations have to be satisfied before any funds can be distributed.  Tensions can run high and your administrator should be prepared to keep such squabbles in check should fights break out regarding the terms of the trust.

While choosing a trust administrator is no doubt a tough decision to make, we are here to help guide you through the process.  Please do not hesitate to reach out to us as a resource if you need assistance setting up a trust and ultimately choosing an administrator to manage your estate upon passing.  Simply call our Charlotte estate planning office at (704) 843-1446.

A special needs planning attorney is familiar with the most common choices faced by parents of children with disabilities and can offer advice and suggestions on how to plan for that child’s care.  They also understand the ramifications of inheritance when it comes to eligibility for government assistance.  Here in Charlotte, as in other places across the country, planning tools such as a “special needs” or supplemental needs trusts must be set up a very particular way in order to meet government standards and allow for the continuation of other benefits.

However, special needs planning is not just about maintaining government support.  It also protects the disabled individual from lawsuits and other debts, as the trust cannot be seized in order to pay these.  This protects the trust and the individual who relies upon it for his or her ongoing care.

A Charlotte special needs planning attorney will be familiar with how local, state, and federal laws interact in order for parents to put together a plan that best protects their child.  It is highly recommended that you seek out a lawyer who specializes in special needs trust planning.  He or she will help set up your child’s trust, as well as explain all the details such as how a trustee will manage the assets for the beneficiary.

One way that people use charitable trusts is to set aside assets to produce income while they are alive, with the remainder going to charity when they pass away.  This allows them to receive tax benefits while they are still living from a gift that will be made when they die.  In this scenario, both the donor and the charity will benefit. There are two main types of charitable trusts.

1. Charitable Lead Trust
You can use a charitable lead trust to make a series of payments to a charitable organization while you are alive.  At some point in the future the remaining assets in the trust either are given back to you or transferred to someone that you select as beneficiary.  In a way, the donor is lending the assets to the charity for a period of time during which the charity can use the income produced by the assets.

2. Charitable Remainder Trust
In this type of trust, you set up two sets of beneficiaries called income beneficiaries and remainder beneficiaries.  The income beneficiaries, typically the trust owner and/or his or her family, receive income from the assets in the trust during their lifetimes.  When the beneficiaries pass away, all remaining assets are given to the charity that is the remainder beneficiary.  This option has the added benefit of missing estate taxes entirely.

The rules for these types of trusts are very complex.  If you are interested in charitable trusts, I encourage you to seek out a qualified Charlotte trusts attorney and tax advisor who can guide you through the process.

Charlotte, North Carolina:   While many people focus on getting out of debt or getting organized for the New Year, estate planning is an equally important personal finance goal that should make every adult’s to-do list.

That’s because according to Charlotte estate planning lawyer, Sabrina Winters, far too many area residents are without plans to protect their family, wishes and assets should something unexpectedly happen to them.  A recent lawyers.com survey further reveals that only 35% of adults have a basic will or other estate planning documents in place should death or incapacity occur.

“Contrary to popular belief, estate planning isn’t just for the rich,” says Winters .  “At a bare minimum, every adult needs a basic will, power of attorney and health care directives in place to avoid a legal and financial stresses and obstacles if something unexpectedly happens to them,” she adds.

So what are these documents and how do they help you in a time of emergency?  Winters explains the following:

• Will- A will is a document that specifies what should happen to your assets if you pass away.  A will may also contain guardian nominations to dictate who will care for your minor children if something unexpectedly happens to you.

• Trust- A trust is a legal entity that can hold title to property. With your assets securely placed in a living trust, you can minimize your financial exposure to lawsuits, divorce and bankruptcy while alive.  Upon death, a trust (if created and funded properly) will keep your affairs private and out of the probate court.  It also allows a great deal of control for people who do not want their inheritance going outright to their heirs if something unexpectedly happens.

• Power of Attorney- A power of attorney or POA gives explicit permission for someone to access your personal accounts, pay your bills and handle all other financial and legal affairs if you are incapacitated in an accident but do not die.   Under the current privacy laws, even a spouse may have a hard time accessing personal information without such documentation in place.

• Advanced Health Care Directive- Also known as a living will, this document specifies your healthcare wishes if you are incapacitated in an accident and unable to speak for yourself.  Such wishes may range from whether you want certain medications administered to when (if at all) to start life support in critical situations.   This document also allows you to appoint the person best suited to carry out such wishes should incapacity occur.

“Accidents and serious illness happen every day without warning,” says Sabrina.  “That’s why it’s so important for any adult who has not tackled their estate planning to add it to their resolutions this year.  It will save their family from potential headaches and unexpected costs should the unthinkable happen”.

About Sabrina Winters:  Winters is a wife, a mom, a business owner and the Senior Attorney at Sabrina Winters, Attorney at Law, PLLC…an Estate Planning and Probate law firm located in the beautiful Ballantyne area of Charlotte, North Carolina.  Winters has been assisting clients in all areas of Estate Planning for over a decade.  Some of her services include:  Wills, Trusts, Probate,Tax Planning, Planning for Children and Succession Planning for business owner

Contact:  Sabrina Winters

Phone:  (704) 843-1446

Email:  swinters@sabrinawinterslaw.com

With the stores crowded, traffic horrendous and holiday parties in full swing, the period between Thanksgiving and New Years Day is undoubtedly one of the most dangerous travel times of the year.  Charlotte lawyer, Sabrina Winters, urges families to be prepared by making necessary updates to their will, trust or other estate planning documents prior to the hustle and bustle of the season.

Charlotte, North Carolina – It is that time of the year again where the stores are packed, traffic is horrendous and holiday parties are in full swing.  And no matter what holiday you celebrate, this is certainly not the safest time to be out and about on the roads.

Between Thanksgiving and New Year’s Eve in 2002  alone, alcohol related crashes killed 1,561 people. That does not even account for the people who were simply injured or incapacitated for any length of time from their injuries.

According to Charlotte estate planning lawyer, Sabrina Winters, the holidays are the perfect time to make sure your will, trust or other estate planning documents are updated so your family stays protected should something unexpectedly happen to you.

“The holidays are a really smart time to make sure your estate plan is exactly how you want it to be should something unexpectedly happen to you and/or your spouse,” says Sabrina Winters,  ”Without an updated estate plan, your children could be left at the mercy of the courts, your assets in limbo and your physical or medical wishes may not be honored in the event of an accident,” Sabrina Winters adds.

Specifically, Sabrina Winters offers four things to consider when updating your estate plan prior to the holiday season:

1. Guardianship nominations:  Have you named guardians to care for your children if something happens to you?  Have you made sure those guardians will have the financial resources to care for your kids in your absence?  Are you even happy with the people you originally chose to care for your kids?  Sabrina Winters says if you answered no to any of these questions, it is time to pull your plan out of the drawer and make a few key changes.

2.  The effect of marriage, divorce or remarriage:  Is your ex-spouse still set to get half of what you own according to the directions of your prior estate plan?  If so, according to Sabrina Winters it is time to update!  Sabrina Winters recommends reviewing your plan carefully to make sure your beneficiaries are exactly as they should be in case something unexpectedly happens to you.

3.  Are your assets owned properly in the name of your trust: If you have a trust, Sabrina Winters says now is a great time to take an inventory of your assets and make sure they are owned properly in the name of that trust.  This is one of the most common reasons an estate plan will fail at the end of a person’s life.

4.  Do you have medical directives and POA’s if you are incapacitated?  If you are incapacitated in an accident but do not die, Sabrina Winters advises that you will need clear medical directives and power of attorney forms so someone you trust can make medical and financial decisions until you are able to speak for yourself.  If medical directives and POA’ were not included in your original plan, speak with a qualified attorney to have them drawn up before the hustle and bustle of the season starts.

“An updated estate plan is the greatest gift you can give to your family over the holiday season, ” says Sabrina Winters.  ”It is the only way to make sure your children, assets and wishes will stay protected should something happen to you during this dangerous time of the year.” Sabrina Winters adds.

For more information about Sabrina Winters, please visit www.ncestateplanninginfo.com or call (704) 843-1446.

Bio:

Sabrina Winters has been assisting clients with all their estate planning needs for over ten years. As a woman, a mom, a wife and business owner, she brings her personal experiences as well as legal experiences to her clients.  Regardless of what stage in life you are or your asset level, Sabrina Winters has the experience and skills to plan for your particular needs.

Huh?

Let me explain…

While the estate tax lapse seems to be in the forefront of the news this year, there is also a lesser-known gap that is offering many people a tax-free way to pass on some of their wealth to their grandchildren.

The Generation-Skipping Transfer Tax, (GST), has also been repealed for 2010.  What this means to grandparents is that you can leave outright gifts to your grandchildren as long as those gifts meet certain conditions.  The definition of a “gift” is fairly broad, but one way to take advantage of this is to set up a partnership and then give away units to your grandchildren. This will mean that you can put funds into a family limited partnership and transfer them tax-free but also transfer it in a way to keep the kids from getting control of the assets all at once and possibly squandering them.

The GST is different than income, estate and gift taxes.  The purpose of this tax is to keep people from transferring property many generations down with the intent and purpose of never paying any tax.  So, the GST is imposed if the transfer avoids gift or estate tax.

Example…

Dad dies with a large estate and leaves his property in a trust with the income payable to his children.  At his death, his trust assets go to his children.  Dad’s estate would then owe estate tax.

But when his children die, the trust property would not be taxable in their name so the family will have avoided paying for a generation of estate tax. In this instance, the GST would apply.

It is important to point out that the GST applies to anyone, not just family, so this would apply to unrelated beneficiaries as long as they were at least 37 and one-half years younger than the deceased.

There are limits to what you can exempt in generation skipping gifts and you are only allowed to use them in certain circumstances.  So, it is important to talk to an experienced Charlotte estate and tax-planning attorney when considering this.

So, as you are making your holiday list and checking it twice you might want to consider this for your grandchildren (naughty or nice!)  This will be a gift they will remember (and thank you for!) for the rest of their lives!

How do you get around this without actually disinheriting your child?  Simply do not provide for a direct inheritance to them and instead create a Special Needs Trust (also known as an SNT). By doing this, you as the parent or other family members may provide for that child while at the same time not put them at risk of becoming disqualified for the needed government assistance.

“Special Planning for Special Needs Children”

I am not certain through whose eyes they determined this. I look around and still see far too many families struggling to recover to consider it over.   And while I acknowledge things may be improving on some level, I still find it hard to objectively look at a parent who cannot find work or lost a huge chunk of a 401(k) plan to say our Country is officially in the clear.

The number of bankruptcies taking place right now equally saddens me.  For many families, bankruptcy may be the only way to break free from the mountain of debt that constantly rests on their shoulders.  Of course that’s not to say this decision is ever taken lightly by those who file, as the consequences of bankruptcy are long-lasting and sometimes severe—especially if you stand to inherit money.

Example: a family member passes away who left you a cash gift in a will or trust.  On the surface it seems like this would be a much needed and timely relief for a family going through bankruptcy.  However, Federal bankruptcy rules declare that if you inherit money from a person who dies within 180 days of the date you filed for bankruptcy, you must tell the courts.   In simple terms, that means the inheritance now becomes a part of your bankruptcy estate and will be distributed to your creditors as the courts see fit.

This also applies to items that you may inherit such as cars, jewelry or furniture.  All of these items are subject to the administration of the bankruptcy estate.  However, this doesn’t mean that items like this are certain to go up on the auction block.  You can claim exclusion on certain things and the bankruptcy trustee has a certain amount of discretion in choosing what to liquidate. However, it can be extremely stressful to think about a family heirloom that has been in your family for years going to auction.

Hopefully your loved one had a Charlotte wills and estates attorney who knew a thing or two about protecting their inheritance from things like bankruptcy, creditors, divorce and the like. Ideally, your loved one would have been advised to set up a trust so any inheritance passed down to their family members would be out of reach from creditors and the courts.  If they did not, and you have not filed bankruptcy yet, this may still be an option if your loved one is willing to have their plan looked at by a qualified Charlotte wills and estates attorney.

Planning to avoid giving your hard-earned wealth to creditors is not illegal or immoral either.  You should think of it the same way you would when considering tax planning.  Tax planning is legal, but tax evasion is not.  The difference is whether you play by the rules and are honest.  For example, not telling the courts you received an inheritance is illegal and you could face serious consequences.  However, you are not skirting the rules if you are the recipient of a spendthrift trust; that was not your choice.

If you or your loved one needs help facilitating such a trust to protect your inheritance from the claims of creditors, simply call our Charlotte wills and estates office at (704) 843-1446 to schedule a “Peace of Mind Planning Session” at no charge ($750 value).  We will walk you through the necessary steps that must be taken to protect your inheritance from a bankruptcy filing or any other creditor’s claim. However, these appointments are limited to 5 per month so call today!

Through the Probate process, beneficiary names, accounts, account numbers and values are required to be disclosed.  We can all agree, I am sure, that this seems like a huge violation of our privacy.  What goes hand in hand with this required disclosure are the potential safety issue this poses to those inheriting your estate.  There are a lot of unscrupulous people who prey on widows and beneficiaries to try to separate them from their inheritance.

So why then is this information made available to the public?

It may be easier to pallet the lack of privacy if you can better understand the true purpose of probate.  One of the primary purposes of probate is to make sure the creditors of the deceased person have an easy way to collect any debts they are owed from their estate. For that reason alone, the probate process must be open and public.  Notice to creditors is required to be given in North Carolina with a mandatory waiting period of 3 months to allow the creditors sufficient time to file their claims.

This information is also available to the creditors of your beneficiaries so that they have notice that they are inheriting an estate. Under this scenario, the creditors could bring an immediate claim against your beneficiary, which may ultimately result in your beneficiary never receiving the inheritance you wanted to leave them.

However, to be clear, I am in no way advocating that debts go unpaid.  In fact, you should instruct your executor to pay your debts.  But, wouldn’t you rather direct how this process goes rather than leaving it to the courts?

One way to do that while simultaneously stopping the violation of privacy and loss of control over the distribution of your estate is to create a revocable living trust.

Unlike a will, a living trust is a private document that will not become a matter of public record because it does not have to be filed with the probate court.  There is no statutory requirement in North Carolina for the Court to over see the management of a living trust.  Therefore, you can name beneficiaries and provide gifts while still attaining privacy since only the trustees and those involved in trust administration will know the contents of a living trust.  This means that no creditor of yours or your beneficiaries, no disgruntled relative, no scam artist, and no nosey neighbor will ever have access to the details of your financial history.

Remember, there are people out there who make a living preying on young or vulnerable people that have just inherited something from an estate. They troll these public records daily looking for victims of their next heist or scam.  Fortunately, with a bit of planning, you can protect your family from such privacy violations that accompany the probate process.  I recommend talking to your Charlotte trusts lawyer about living trusts and how they can help your family if something unexpectedly happens to you.

Fortunately, we’ve made that process easier than ever by making five (5) free “Peace of Mind” planning sessions available to readers of our blog.  Simply call (704) 843-1446 and mention this article to reserve your spot.  Your family will thank you for it.