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Probate Expenses

Proper estate planning can help save time, save money, and protect the privacy of an estate.  Probate expenses can have a wide variance depending on where you live and how much you have in assets.  Some states, like California, have specific fee schedules based on the assets you own upon your death.  Other states, have subjective fees where the probate statutes simply state that the fees must be reasonable.

These fees for Probate also are based only on assets and ignore any debts, which this means if you own a $500,000 home, and owe $450,000, the probate fees are based only on the $500,000 value of the home, ignoring the mortgage.  One thing to keep in mind while reading this is that a properly executed trust can avoid Probate entirely, negating these fees.

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In part 2, we explored some methods to limit liability for your business with limited partnerships and limited liability companies.  In Part 3, we will explore Corporations and tax considerations in business formation.

Corporation

The Corporation, according to Black’s Law Dictionary, is an entity having authority under law to act as a single person distinct from shareholders who own it and having rights to issue stock and exist indefinitely; a group or succession of persons established in accordance with legal rules into a legal or juristic person that has a legal personality distinct from the natural persons who make it up, exists indefinitely apart from them, and has the legal powers that its constitution gives it.  A corporation is an artificial being, invisible, intangible, and existing only in contemplation of the law…[I]t possesses only those properties which the charter of its creation confers upon it.

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Starting a business can be a fun, exciting, and terrifying ordeal. It takes a vision, a plan, and the execution of the plan while also adjusting for events as they affect the plan.

During a lecture I was attending once, the speaker said, “Anyone can start a business, but not everyone can run a business.” That, combined with a recent conversation I had got me thinking that I should write about this topic, and all of the questions that come with starting a business. While this is a general discussion of legal principles, it will provide a good foundation of information to think about and discuss with your attorney. Continue reading

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The Affordable Care Act, commonly referred to as ObamaCare places requirements on some businesses to offer health insurance for their employees.

The Affordable Care Act has become a highly debated topic and this article is not addressing the merits or drawbacks to the law, it is simply explaining what is required.

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In Part 1, we started exploring do-it-yourself (DIY) legal products compared to hiring an attorney.  DIY legal products can be appealing because they can be far less expensive than hiring an attorney, but it may not meet your needs.

In a comparison of a will provided by LegalZoom and a will from an attorney, I think most people would agree that a more educated and legally proficient person may be able to obtain a better end-result with DIY product than a less educated and less-proficient person.  In exploring this theory, a Minnesota attorney named Gregory Luce decided to compare LegalZoom with a will drafted by an attorney. The article about his experience can be found here.

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Do-it-yourself (DIY) options have become a lot more common in the world of legal services. You can now go on-line to prepare your taxes, write your own estate plan, and open your own business, among numerous other options.

While these DIY options to establish a plan do exist, the question remains of the quality of the plan that these DIY options create. Continue reading

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In Part 1, we explored what a Testamentary Will was and the typical costs associated with Probate of the Will. In Part 2, we explored what a Revocable Living Trust was and started exploring the benefits of a Revocable Living Trust.  In Part 3, we will finish exploring the benefits of a Revocable Living Trust and the benefits of a Testamentary Will.

Save Time

Probate takes time and is often dependent on court schedules. As an example, there was one case that we followed in 2012-2013 that had a trust, and had to go through probate because some of the assets were not included with the Revocable Living Trust.  In that case, the probated items took approximately nine additional months to resolve and cost attorney and personal representative fees were an additional $17,000.  I am using this example because it was a very simple estate with one beneficiary (widower), with no disputes, and no delays in the processing of documents.  It is important when you establish your trust; you ensure all of your property is properly included with the trust.

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In Part 1, we explored what a Testamentary Will was and the typical costs associated with Probate of the Will. In Part 2, we will explore what a Revocable Living Trust is and start to explore the benefits of a Revocable Living Trust.

Revocable Living Trust

A Revocable Living Trust is a document that tells the successor trustee (acts similar to the executor or the personal representative in Testamentary Will) what you want to happen with your property after you pass away, and you can amend (change) the Revocable Living Trust at any time in the future.  A revocable living trust can also continue beyond the immediate distribution and can make distributions for ongoing care of children or pets.

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Last Will ImageEstate Plans

One of the first questions we are usually asked is if someone really needs a trust or a will. In answering that, we need to explore what a Will does, how a Trust differs from a Will, and why they are important in an estate plan.

Everyone should have a either a Will or Trust (Estate Plan) because without one, the courts rely on statutes within the state to determine what happens to your estate. Even if there is no individual that you wish to leave your property to, it is often preferred to leave it to charity rather than the possibility of the government taking all or some of your estate.

There are three main reasons people choose to have a Revocable Living Trust over a will. A Trust tends to save money, save time, and protect privacy, although it tends to have a higher upfront cost than a will, it will tend to be cheaper than a will upon death. In this part, I will briefly discuss what a will does and explore the costs to the estate going through probate. Continue reading