Wills

Should You Ask Your Parents About Their Estate Plan?

Published on: December 23, 2019 | by Burt + Clerc

Yes. The answer is unequivocally yes. The conversation might be uncomfortable and hard but necessary. Adult children don’t need to know everything, but they should be informed of some basics of their parents’ estate plan. A surprising number of Americans do not have a full estate plan in place. Only about 18% have an estate plan that contains at least a Will, Advance Health Care Directive and Power of Attorney. Most children believe it’s the responsibility of the parents to initiate a conversation about succession planning however, most parents don’t. A recent article in the Wall Street Journal highlights the challenges and offers suggestions for this difficult topic.

First and foremost it’s important to bring up the subject, inquire gently and respectfully and, if necessary, enlist a third party for help.

Can You Inherit Loyalty Points from a California Estate?

Published on: October 17, 2019 | by Burt + Clerc

The short answer is, not easily. Generally, the airline’s policy is that your miles expire when you do. The crux of the problem is that airlines own the miles. You don’t. It is buried deep in nearly all frequent-flier program terms and conditions. They, therefore, can make any rules they want. Additionally, those terms and conditions also usually contain provisions prohibiting the sale or transfer of miles thereby making it difficult to pass them on when you die. Even if an airline might be lenient, they probably will impose a fee to transfer miles after death. The last thing you want to be doing after a loved one dies is pleading with an airline company so that you don’t lose your loved one’s 500,000 points.

A recent Wall Street Journal article suggests the following:

1. Have a will. Many airline companies don’t understand revocable trusts so having a will and including specific language about the airline miles is important.

2. Make sure your accounts remain active. It’s much harder to work with a surviving spouse when the deceased spouse’s account is about to expire.

3. Don’t call credit card companies to inform them of a death until you’ve implemented a plan for the airline miles. Many companies will simply close accounts (and points will be lost) when the credit card company associated with the loyalty program is informed of the death of a cardholder.

4. Make sure you give online access to the person you want to receive the miles. This includes giving them account numbers and login information and passwords. You should also give the login information and passwords for the credit card associated with the loyalty program as well as your email.

Make a Better Charitable Gift

Published on: September 23, 2016 | by Burt + Clerc

Making charitable bequests in Wills or Trusts is a common practice. However, many individuals merely name a charity and do not specify for what purpose such a gift should be earmarked. Recently, an extremely generous, if not equally frugal, librarian in New Hampshire left his entire $4 million estate to the University of New Hampshire. He stated that $100,000 must be used for the library, but did not specify how the rest of the funds must be used. The University has decided to use $2.5 million to expand a career center for students and alumni. However, the University has also decided to use $1 million to purchase a video scoreboard for the school’s football team. This decision is causing an uproar among students and community members who believe that the spirit of the gift is not being followed. The contention is that the donor would be “turning in his grave” if he knew that his money was being used to purchase a video scoreboard.

To prevent similar issues for your charitable gifts, you should leave specific instructions and directions as to how your gift must be used. If you do not, the charity has the discretion to use the funds in any way it chooses. Sample language includes, “To Charity X to be used for ___________” or “$$$$ to Charity X to establish a ______________ in my name.”

Estate Planning Lessons from the Rich and Famous

Published on: March 10, 2014 | by Burt + Clerc

Some celebrity estates are embroiled in the media and legal battles while others remain private and relatively peaceful. Here are some lessons learned from the estates of the rich and famous.

Fund Your Revocable Trust

Recently deceased Paul Walker set up a trust for the benefit of his minor daughter. However, he failed to fund it so it will eventually be funded under the terms of his pour-over will when the probate is closed. His will and his reportedly $25,000,000 in assets is now public record through the probate court proceedings in Santa Barbara, California.

A Trust Administration Guide for Beneficiaries in La Quinta

Published on: November 4, 2013 | by Burt + Clerc

As Estate Planning attorneys in La Quinta, we frequently get calls from beneficiaries who have just received notice that they are named in a trust. Sometimes they require our services; sometimes they do not. Below is a guide to help trust beneficiaries through the murky waters of trust administrations.

Step 1: Read the entire Trust and all amendments

If you do not have a copy of the trust, request one. In California, all beneficiaries are entitled to a copy of the trust instrument and all amendments. If something is unclear in the trust, ask questions. You may be able to get satisfactory answers from the Trustee or the Trustee’s attorney. If you don’t you may need to contact a lawyer.

Estate Planning Issues for Gay and Lesbian Couples in Palm Springs

Published on: August 28, 2013 | by Burt + Clerc

While the end of DOMA is wonderful, it doesn’t solve all problems for same-sex couples. The lifting of DOMA restrictions only applies to married same-sex couples. Unmarried same-sex, and also opposite-sex, couples have unique issues and concerns when creating an estate plan. Various techniques and tax saving vehicles are unavailable to unmarried partners.

Joint Trusts

Joint trusts are unadvisable for unmarried partners since the couple does not enjoy marital exemptions in gifting. Unmarried partners may choose instead to have separate trusts with identical provisions. For example, when one partner dies the other inherits everything.

Why You Should Not Hold Property in Joint Tenancy with Your Children

Published on: April 22, 2013 | by Burt + Clerc

Our Palm Springs Estate Planning attorneys have clients who frequently ask about putting their children’s name on their real property deed. The assumption is that this will avoid probate and will also avoid the necessity for a living trust or other complicated estate planning documents. However, this technique is usually a bad idea.

Minor Children
Except under very limited circumstances, minor children should not own real property. A minor cannot execute legal contracts and thus it becomes extremely problematic when you want to mortgage, sale or rent real property that is jointly owned with a minor.

Creditors
When you own property with your children then the property becomes part of their estate. This means that any creditor of your children’s estate can attach liens and judgments against this property. Although your child may not have any known creditors beware of the unknown creditors. What happens if your child is at fault in a car accident? The creditor in this scenario can attempt to attach a lien or judgment against the property.

Joint Ownership
You may have transferred part of the property to your child just to avoid more complicated estate planning documents. However, now your child actually owns a piece of the property. This means that you will need their written consent to sale, mortgage or rent the property.

Predeceased Children
No one wants to contemplate that their child may predecease them. Unfortunately, this does occur. Also, many families travel together. If you and your children die simultaneously now the property must be probated but it will be a mess. The child’s ownership interest and your ownership interest must go through separate probate cases.

Gifting Concerns
The minute you put your child’s name on your deed it is as though you just gifted to them a portion of the property. If the value of the gift is over $14,000 you will be required to file a Gift Tax Return. Although you probably will not owe any taxes on this gift transfer, you are still required to file the return.
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Challenges with Naming a Guardian for Minor Children

Published on: March 11, 2013 | by Burt + Clerc

Many parents fail to complete a will because they struggle with the decision of who to nominate as a guardian. However, failing to put your wishes in writing is detrimental to your whole family. The following are some of the most common concerns and possible solutions when naming a guardian for minor children.

Guardian is Too Old
Grandparents are increasingly popular guardian nominations. But, some parents worry that if they pass away in 10-15 years their parents (the children’s grandparents) will be too old. Do not worry about the age of the guardian in 10-15 years. By that time, you may have a different person to nominate. Also, your children’s’ needs will be significantly different in 10-15 years so an older guardian may be perfectly fine.

Your Family Won’t like Your Choice
Try to disregard the opinions of your family members when nominating a guardian. You understand and appreciate the needs of your children better than anyone else. Explain your choices in your will and don’t get hung up on whether your sister or mother-in-law will agree with your choice.

Your Children Won’t Like Your Choice
If your children are old enough to understand, have a discussion with them about your choice. Teens can nominate their own guardian and judges are generally receptive to their choices. If your kids understand your choice this may help them better decide for themselves.

The Guardian is Bad with Money
A court will appoint a guardian of your children’s person and estate. However, these positions can be filled by different individuals. If you have a trust the trustee can be appointed guardian of your children’s estate and he or she will manage the money for the children’s benefit. However, if you want to name a different individual for the person and estate your wishes should be clear in your will.
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Palm Springs Estate Planning Attorney Explains Why Every Parent Needs a Will

Published on: July 2, 2012 | by Burt + Clerc

New parents have a lot on their minds. Between 2:00 a.m. feedings and baby proofing, most parents have not even begun to think about making a will. This is a grave mistake. Having a valid will is one of the most important things you can do for your child.

Although wills can designate who will inherit your bank accounts, real property and jewelry, more importantly, they designate a legal guardian for your children. All children under the age of 18 require a legal guardian. While parents are still living they enjoy this role. However, when parents die leaving minor children a court must decide who will be appointed legal guardian. If you have a will, you can designate who this person will be. If you do not have a will, the courts will decide for you.

Designating a guardian for your children is probably one of the toughest issues parents face. Should it be grandma? Or your best friend? Or your sister who lives 3,000 miles away? Every family is different and every child is different. In one family it may be grandma who is best suited for this role. In another it may be a friend and not a family member at all who is the best person to care for your children. Once you have decided who the individual is you must put it in writing in your will.

La Quinta Probate Attorney Explains the Need for Competency When Signing Your Will

Published on: June 25, 2012 | by Burt + Clerc

Everyone needs an estate plan. However, too often we get calls to do an emergency house call because Mom or Dad received a bad prognosis and doesn’t have any estate planning documents in place. While we endeavor to accomplish the needs of these individuals, sometimes we simply cannot. California law requires that an individual have testamentary capacity to sign a Will or Trust. A person is not mentally competent if she or he doesn’t understand the nature of the document, cannot remember the nature and types of his or her property, and doesn’t recall his or her relations to living relatives.

A dementia diagnosis does not automatically prohibit someone from having testamentary capacity. However, it is crucial to have your estate planning documents in place before you become severely ill or disabled. Children whose parents suffer from a memory disorder should try and determine if Mom or Dad has sufficient planning before the disorder gets worse. This does not mean that children should have access to Mom or Dad’s will, but an honest conversation with parents about the state of their affairs is certainly prudent. Too often we have clients come in trying to sort of their parents’ estate because they were too embarrassed to talk to Mom or Dad while they were living.