Charlotte, North Carolina Estate Planning Attorney » trusts

Probate Court Fees in North Carolina

Sabrina Winters — Wed, 28 Jul 2010 14:00:29 +0000

For those of you who still aren’t convinced that avoiding Probate should be a priority, here is a link (http://tinyurl.com/probatefees) to the list of fees that the North Carolina Probate Court charges for various documents, filings and actions in a probate matter. By they way, some were just raised…again. When calculating fees, don’t forget to add in the legal fees the attorney will charge to open, administer and close the estate. Some firms charge an hourly and others charge a percentage of the value of the estate, so it is hard to estimate what that might be. You can probably approximate that it will cost 4% to 10% of the value of the estate. Not necessarily worth the lower price of a Will (as opposed to a revocable living trust) when you (well, actually your estate) is going to spend more money in the long run. Just something to consider.

10 Events that Signal a Review of your Living Trust

Sabrina Winters — Mon, 05 Jul 2010 14:00:53 +0000

You get married or divorced
Your spouse dies or becomes incapacitated
You have a new grandchild
Your child marries or divorces
Your child becomes ill or disabled
One of your beneficiaries proves to be financially irresponsible
You retire from your business or profession
You acquire property in or move to a different state
The value of your assets have increased
There have been law changes that may affect the language of your document

If you experience any of these events, please contact Sabrina Winters, Attorney at Law, PLLC

at (704) 843-1446 to schedule your review appointment.

Top 4 Beneficiary Issues to Consider with your Retirement Accounts

Sabrina Winters — Thu, 01 Jul 2010 14:00:27 +0000

Have you checked your beneficiary designation for your retirement account recently? If not, you may find that your designated beneficiary is not who or what you think it should be, especially if you have divorced, remarried or had children since your retirement plan account was established.

1. Outdated Beneficiary Designations

There have been numerous cases of retirement-account owners who have been divorced and remarried but have neglected to update their beneficiary designations accordingly. This can be quite frustrating for their survivors, who must battle in court for a legal determination of the true beneficiary. The court’s decision, however, may not necessarily be what the deceased would have wanted.

A similar dilemma arises if children are named as beneficiaries but the document has not been updated to include those who were born after you set up your account. To prevent these situations, you should update your beneficiary designation periodically or even immediately after you experience a change in family status. Should you need to, you may submit a change-of-beneficiary form.

2. Per Stirpes Designations

In the event your child predeceases you, a per stirpes beneficiary designation would allocate that share to the that child’s issue – your grandchildren. If you don’t name them, they will be disinherited from taking the share of their parent.

3. Make Provisions for Simultaneous Death

Many spouses, expecting that one will predecease the other, name each other as their designated beneficiaries. The issue of simultaneous death is then addressed by state law, which will determine that one spouse died first, even though both deaths occurred at the same time. This determination is critical, especially if there are children from a previous marriage: will all the children be included? Or will children from a previous marriage be excluded? Proper documentation designating successor beneficiaries for normal and extenuating circumstances will ensure that the retirement-account owner decides who the successor beneficiary is.

4. Look into a Trust for Your Distributions

If you feel you need to retain some degree of control over the disposition of the retirement assets after your death, you may consider designating a trust as your beneficiary. Designating the right type of trust as your beneficiary could offer these benefits: allow you to provide financial support for your surviving spouse while ensuring that children from previous marriages are also provided for; helping to maximize your estate tax exclusions; and controlling distributions to the children you might think are not mature enough to handle a large IRA. Trusts require expertise to set up correctly, so please ask me for some assistance before you make any decisions regarding customized and/or trust beneficiary designations.

Beneficiary Designation Checklist

Check the default provisions of the document that governs your retirement account, as it may come into effect if your beneficiary predeceases you and you fail to make subsequent changes.

1. Look into the tax implications for the kind of beneficiary you choose, whether a particular person, such as a spouse or non-spouse, an entity, such as a charity, your estate or a type of trust.

2. Request a confirmation of receipt of the designation from your retirement account trustee, custodian or administrator. Documents do not always reach their intended recipient and/or may get lost in transit. Beneficiary designations are considered in effect only if they are received by the responsible party (e.g. trustee, custodian or administrator) before the retirement account owner dies.

3. If you prefer to use a customized beneficiary designation, make sure your trustee, custodian or administrator finds it acceptable. Not all financial institutions or qualified plans will accept customized beneficiary designations.

4. Check with your financial institution periodically to determine who your beneficiary is – you may need to make changes if you had a change in your family such as a birth, death, divorce or marriage.

Making a proper beneficiary designation is a very important part of your financial planning process. I would will be happy to assist you in reviewing your current beneficiary designations to see if they are up to date and/or if you need to make changes.

Please contact Sabrina Winters, Attorney at Law, PLLC at (704) 843-1446.

Top 5 Estate Planning Mistakes

Sabrina Winters — Mon, 28 Jun 2010 14:00:40 +0000

I recently read a report that suggested that only about 20 percent of the population has a formal estate plan. After reviewing the points below, please take a minute to consider whether it’s time for you to create or update your estate plan.

Here are a few of the top 5 estate planning mistakes that people make that can be avoided.

1. Dying without a will or trust - If you die without a will or trust, the state in which you reside and the IRS will simply make one for you. Of course, they have no interest in avoiding or reducing estate taxes, minimizing estate administration costs or protecting your family and legacy. The distribution of your assets will just be turned over to the Probate Court. The probate process is needlessly time consuming, frustrating and expensive. It is also open to the public, meaning creditors, predators or anyone else will have complete access to all information about your estate. For the vast majority of people, the benefits far outweigh any initial costs.

2. Having an “I love you” will – An I love you will is one in which all the decedent’s assets have been left to the spouse. On paper, it might seem to be a caring, thoughtful gesture, but the reality is quite different, because such a will simply passes the complex issues and problems associated with transferring and protecting wealth onto the spouse or other loved ones. It creates more problems than it solves, particularly for future generations.

3. Giving property outright to your children – Here is another solution that might sound good at first, but ignores several important realities. For instance, what if the child in question is too immature to handle the responsibility of a large sum of money on his or her own? What if the child suffers a severe financial setback that puts the inheritance at risk to creditors? What if the child marries a fortune-hunter, is addicted to drugs or alcohol, gets divorced or remarried? You may need to protect your children and heirs from their own poor decisions. These assets are also gifted assets which carry potentially large IRS penalties if not handled properly.

4. Owning property jointly – There are two types of joint ownership, Joint Tenancy with Right of Survivorship (JTWROS) and Tenants in Common (TIC). Problems with JTWROS include postponement of probate only until last tenancy, the loss of the double step-up in tax basis creating more to pay in capital gains taxes, and outright distribution. With TIC, you also lose the double step-up in tax basis where it’s available, and your property is subject to the estate plan of each tenant as well as probate for each tenant.

5. Not having a trust – A trust is the single most effective estate planning tool available. There are many different types of trusts. Among the better known and more commonly used are revocable trusts, irrevocable trusts and testamentary trusts. A Trust protects your privacy, and will help you leave what you want, to whom you want, in the way you want at the lowest possible cost overall.

Post Funeral Planning Checklist

Sabrina Winters — Sat, 26 Jun 2010 14:00:18 +0000

This list is meant as a starting point on what should happen after someone passes away. You should consult with an experienced probate attorney before taking any action.

Items to Find and Secure:

The Last Will and Testament and Trust Documents
Keys to safe deposit box
Life insurance policies
Business partnership agreements
Decedent’s checkbook
ATM card
credit cards & address book
Bank account statements
Marriage certificate
Veterans records
Retirement plans and employment records
Tax returns
Important & valuable family keepsakes

Items to Collect:

Current monthly bills
medical bills
bank statements
Checks received in the name of the decedent
Keep receipts for funeral expenses and any “out of pocket” estate expenses. Executor should accumulate list of assets and liabilities and debts
Note due dates on bills
Note the legal title descriptions on all accounts, assets and debts
Take pictures of home for quick inventory of contents (with no surviving spouse)

Contacts to make:

Family and Friends that could not be reached for funeral
Minister, priest or other support resource
Estate Attorney
Executor or Attorney to deliver Last Will & Testament to probate court
Accountant
Social Security
Veterans Administration
Insurance companies (regarding life, health, property insurance & annuities)

Family Care Issues:

Be mindful of family member bereavement issues and healthcare
Maintain security of home and property
Note family “issues” or disputes
Spouse may use joint account to pay bills, but others should not use decedent’s checkbook, credit cards or ATM card or auto
Consider a memorial or donation that the; family, beneficiaries and Personal Representative believe to be a fitting remembrance.

Starting the Probate Process and Responsibilities:

Getting the Last Will and Testament to the probate court will allow the Personal Representative (upon appointment) to pay bills. Probate assets (assets held in decedent name) or personal property items should not be distributed to beneficiaries without court approval. Executor, Personal Representative (or Attorney) should maintain possession & control of property and all important records and documents.

Contact Sabrina Winters, Attorney at Law, PLLC at (704) 843-1446 and will would to assist you and answer any questions you may have.

Advantages of a Revocable Living Trust

Sabrina Winters — Wed, 23 Jun 2010 03:16:40 +0000

Let’s look at some of the advantages of having a revocable living trust in place:

Avoids Probate - Probate is the legal process for transferring your property when you die. Assets named in trust avoid the costly and time-consuming court probate proceedings.

Avoids Multiple State Probate Proceedings - A living trust can be especially helpful in avoiding expensive multiple probate proceedings when you own real estate or other property in several states.

Changeable or Revocable - The living trust allows you to make changes (or amendments) to the trust document while you are still alive.

Protects Your Privacy – Trusts allow the transfer of your personal assets to remain private. The probate process may expose your estate to the public.
Eliminate Challenges to the Estate – The standard will can create family disputes at your death and be challenged for alteration by any member of your family. By using a trust, you avoid contests.

Segregation of Assets – This is useful for married couples with substantial separate property that was acquired prior to the marriage, as a gift or for inheritances.

Helps if You Become Incapacitated – A properly drafted living trust package will include Powers of Attorney for financial and medical needs as well as Living Wills and Nominations of Conservator.

Guardianship for Minors or Disabled Children – A properly drafted living trust package will include guardianship documents.

Estate Tax Minimization – While the main reasons for doing estate planning with a revocable living trust are stated above, you may also take advantage of some tax planning benefits with a revocable living trust. Trust tax planning should be completed with competent counsel of an estate planning attorney and your financial planner.

Disadvantages

While there are many advantages to establishing a revocable living trust, there are also some drawbacks: initial cost is higher than creating a will; you must make sure all your assets are in the Trust or you don’t avoid probate; there may be additional recordkeeping for the trustee; sometimes you are misinformed that there is asset protection with a revocable living trust but property is treated just like you own it in your own name; and there may be minor complications such as having to take property out of trust before refinancing.

Conclusion

While there are a few minor disadvantages of having a revocable living trust, the advantages far outweigh them. The peace of mind you receive from taking care of your estate while you are living and having it’s disposition settled is worth the investment.

If you would like further information about your estate planning options, please contact our offices at (704) 843-1446 for your complimentary telephone consultation.

Aid and Attendance benefit for Wartime Veterans – most Veterans are unaware of this benefit

Sabrina Winters — Tue, 02 Mar 2010 22:25:21 +0000

I am proud to announce that the Firm of Sabrina Winters, Attorney at Law, PLLC is now assisting wartime veterans and surviving spouses of deceased wartime veterans in receiving a special monthly pension benefit called Aid an Attendance. This is not a new program. Too many veterans are unaware that they may be entitled to it.

The Aid and Attendance may be available to wartime veterans and surviving spouses who have in-home care or who live in nursing homes or assisted living facilities. This benefit allows many to enjoy a higher quality of life when their cared needs have increased. Benefits range from $1,056 to $2,540 per month.

The Veteran must meet both Asset and Income requirements according to the Veterans Administration Rules and Regulations. However, if the Veteran exceeds these limits, there are carefully structured trusts that can be used to allow him or her to become eligible.

I welcome Veterans who are residents of North Carolina as well as their family members to contact our office with any questions so that we many provide you with the information necessary to understand the VA benefit and the application process.

An Asset Protection Trust Could Offer Tiger Woods Valuable Asset Protection

Trusts EstatesProf — Tue, 02 Mar 2010 00:21:00 +0000

As Tiger Woods attempts to salvage his marriage, the Trust Advisor Blogs suggests that in the meantime he consider putting his assets into an asset protection trust. Because Tiger lives in Florida, a non-community property state, he could likely fund…

Advocating for Pooled-Special Needs Trusts

Trusts EstatesProf — Tue, 10 Nov 2009 07:00:00 +0000

Jack Sullivan (J.D. candidate 2010, Minnesota University) has published his student article entitled Pooled Special-Needs Trusts: An Exception That Should be the Rule to Protect Adults with Developmental Disabilities, 17 Law & Ineq. 441 (2009). This Article argues that every…

What is a Credit Shelter Trust?

Sabrina Winters — Wed, 19 Aug 2009 14:30:03 +0000

This is probably the most popular type of arrangement for married couples with substantial estates. It provides that at the death of the first spouse, his/her estate will be split into two parts. One part, equal to the estate tax exemption amount ($3,500,000 in 2009) would go into a Trust so it would not be included in the surviving spouse’s estate. This is known as a Credit Shelter Trust. The rest of the estate of the first to die would go to the surviving spouse tax-free due to the marital deduction. Thus, there would be no Federal Estate Taxes at the first death and the exemption amount from the first spouse would be kept out of the estate of the second.

While Trusts are not needed to get the tax benefit, they are commonly used. That is, you could leave the exemption amount directly to the children and the rest to your spouse. But, Trusts can provide money management, ceditor protection, ongoing tax benefits and flexibility. For Example, the credit shelter trust could pay all income to your spouse and your souuse could have the right to withdraw 5% of the principal per year, without causing that trust to be inlcude din the spouse’s estate. The Trustee could also have the discretion to use principal for your spouse’s health, education, maintenance and support. Or, the Trustee could be given additional options to benefit your children.