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The Other Benefits of Charitable Giving - Texas Estate Planning

Lifetime gifts may carry considerable advantages over charitable bequests. "One interesting aspect of lifetime giving is that you get to see your donation in action, even if you prefer to do so anonymously," says Linda S. Beerman, chief fiduciary officer for Atlantic Trust. "Even the less charitably inclined sometimes view this as a valuable incentive, considering that at least a portion of those funds would otherwise go to taxes."

There’s also the goal of receiving an income tax deduction, as well as estate tax savings, explains the PR Newswire article, titled “Benefits of lifetime charitable gifts can outweigh bequests.”  For instance, individuals who give cash to public charity typically are entitled to an income tax deduction of up to 50% of their adjusted gross income (AGI) or up to 30% of their AGI for donations of other appreciated assets that are held for at least a year. What’s more, these deductions can be carried forward for up to five years if they can’t be taken in the year the gift was made.

There are a few factors that come into play when creating a giving plan. Donors need to consider the pros and cons tax-wise of donating various types of property—and also the manner and timing of the gift.

There are other ways to give besides writing a check, accordingly to the original article, like structured giving vehicles. These types of strategies include a donor-advised fund, a private foundation, or a charitable remainder trust. These can give you additional benefits such as convenience, control, and anonymity. In addition, donors are able to leverage multiple giving vehicles to maximize the effect of their charitable giving.

Gifting real estate or tangible property, like a valuable piece of art or a classic car, are also terrific ways to make a sizable contribution to a charity. However, these types of donations may be a little more complicated. The timing of your gift or charitable donation can also be a critical element in your decision making process, as a donor's financial profile and tax outlook could influence when you make the gift and whether you do it in a single year or you start a multi-year gifting program.

A qualified estate planning attorney will know how to best structure your giving intentions to maximize your gift for both you and the recipient.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: PR Newswire (March 12, 2015) “Benefits of lifetime charitable gifts can outweigh bequests”

Estate Planning Advice for Your Second (or Third) Marriage

If you’re anything like the typical person contemplating a second (or third) marriage, you are older, have children, have accumulated property, and have been enjoying a standard of living you would like to maintain. Below are a few important considerations for estate planning for a second marriage.

The Des Moines Register recently published an article entitled, “Estate planning for a second marriage,” that discusses several great tips to keep in mind if you are faced with this situation. Here are a few:

Discuss Money. This is a major cause of stress in any marriage; however, it can be really challenging in a second one. You and your future spouse should talk about and come to an agreement on all of the important financial issues. Make plans that both of you are OK with. If you’re considering a prenuptial or postnuptial agreement, it’s all the more important to tell all (finances-wise).

Consider a prenuptial or postnuptial agreement. This contract is critical if you will bring assets into the marriage, the article explains. A surviving spouse has the legal right to take an “elective share” of the deceased spouse’s estate, regardless of what is in the will, usually one-third or one-half of the elective estate. If this happens, it may result in the unintentional disinheritance of your children or other heirs. The only way to trump the elective share laws is to sign a prenup or postnup where both parties waive their rights to the elective share. This reduces the chance that state law will interfere with your intended estate plans.

Revise your will and other estate planning documents. Remarriage doesn’t revoke a will (although state law can supersede it), so it’s critical that you draft a new will that takes into account your new circumstances.

Providing for children from a previous marriage. It can be a big concern in many second marriages to provide for the new spouse without cutting out children from an earlier marriage. An estate planning attorney can help you place your assets into a qualified terminable interest property (QTIP) trust. With this, all trust income is devoted to supporting the surviving spouse while the principal is preserved for the children. Plus, assets passing to a valid QTIP trust qualify for the marital deduction, which helps reduce possible estate taxes at your passing.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: Des Moines Register (April 14, 2015) “Estate planning for a second marriage”

Twisted Sister Drummer’s Estate Planning Didn’t Rock

When Twisted Sister drummer AJ Pero died on March 20, it caught his fans and bandmates by surprise — and Pero’s own lack of estate planning has reportedly thrown his family into chaos as well. Frontman Dee Snider has issued a typically frank statement to House of Hair, calling the situation “the unfortunate reality of irresponsible adult behavior” and using the aftermath of Pero’s death as a sobering reminder of what can happen when we don’t get our affairs in order while we still can.

“Not only did AJ Pero have a family history of heart disease, which he allowed to go unchecked, but he did not have a will, left behind two ex-wives, a longtime girlfriend, four children between the three of them and a mess of an estate to be sorted out,” said Snider in an article on the website ultimateclassicrock.com titled “Twisted Sister Drummer AJ Pero Died Without a Will.”

Oh my.

Now, the article says there’s plenty of infighting, mistrust, and dissension among the family members about how to handle AJ’s estate. “What a mess.”

Twisted Sister was planning to retire as a band after a 40th anniversary tour, and is now trying to help AJ’s survivors. “While the legalities of the situation are being sorted out, Twisted Sister is doing a show to raise some money to help the family out in the short-term,” Snider remarked.

“This unfortunate situation should be a life lesson to all to take responsibility for the world we create and will leave behind when we are gone.”

Wow, did you catch Dee Snider’s great estate planning advice?

Take responsibility now and after we’re gone.

Although Pero’s longtime girlfriend started a GoFundMe campaign to help with expenses of the daughter she had with AJ, that site is no longer online.

It’s no secret that there’s major potential for disagreements after a loved one’s death—even when there is a will. Make sure that you speak to a qualified estate planning attorney to take responsibility for your family and avoid the headaches now facing the family of Twisted Sister’s late drummer.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: ultimateclassicrock.com (April 8, 2015) “Twisted Sister Drummer AJ Pero Died Without a Will”

Baby Boomers Need to Remember Estate Planning with Their Retirement Planning

Many Baby Boomers are neglecting a key part of their retirement plans — creating an estate plan. And while death is not a pleasant thing to think about, death without an estate plan can create havoc for your surviving family members, financial planners warn.

USA Today recently published an article, titled “Big retirement mistake: Boomers with no estate plan,” that offers several tips for people who might be lagging behind in their retirement savings.

Failure to consider wills and estate planning is a frequent issue, and not just for Baby Boomers. People usually think that it’s something they can put off and deal with later. The article emphasizes that there are three very important things to think about when you start your estate planning (this week!):

1. Your property and financial assets;
2. Your children (if they are not adults); and
3. Medical decisions.

“Just because you are doing good retirement planning doesn't mean you are doing good estate planning, unless you address all three areas,” the article cautions, and sets out some important things to remember when you create your estate plan:

• Work with an established estate planning attorney to help you protect the safety of your financial plan.
• Get comfortable with the laws in your state, as each state has its own probate laws. Again an estate planning attorney is your best bet here.
• Update all of your beneficiaries. Retirement plan and life insurance beneficiaries don’t pass through your will.  These are totally separate and will pass based on your beneficiary designation.

Talk with an experienced estate planning attorney to review these points and others as you create your strategy for the future.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: USA Today (April 8, 2015) “Big retirement mistake: Boomers with no estate plan”

Common Senior Mistakes in Retirement Planning - Texas Estate Planning

While there is nothing that can guarantee that you will have sufficient money to cover all potential costs in retirement, there are certainly some common mistakes that you want to steer clear from to help protect your assets.

Physician’s Money Digest lists some of the most common mistakes that the authors have seen seniors make in a recent article titled “Top Mistakes Seniors Make”:

1.  Misinformation about Medicare.  Some seniors believe that once they qualify for Medicare, they are 100% covered without any gaps. Unfortunately, there may be issues, such as nursing homes and assisted living for long-term care. These are not covered under Medicare.

2.  Failing to consider mental incapacity. Many seniors don’t address how they want health care and property decisions handled in the event they are incapacitated. Remember, a will doesn’t take this scenario into account.

3.  Drawing from retirement accounts too soon. Withdrawing money from your retirement accounts too soon or too late can really affect your savings. Speak with an estate planning attorney about the retirement account rules to get the most from your assets.

4.  Mis-timing life insurance decisions. You should assess your life insurance needs and current premiums to determine what is appropriate in your circumstances.

5.  Relying on annuities. Whether an annuity is the right choice depends primarily on your specific financial situation. Conduct an in-depth assessment of the product and your overall financial plan with an estate planning attorney.

As you can see, there are many issues that need to be addressed when it comes to retirement planning. Do not go it alone. Get appropriate professional counsel.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: Physician’s Money Digest (April 8, 2015) “Top Mistakes Seniors Make”

Two Major Mistakes in Estate Planning - Texas Estate Planning

You're probably well aware of the need to orient your investments toward retirement, but you might be less aware of the need for an estate plan. "I think that on a list of things to do, it's at the bottom, if it even makes the list," Nicole Hart, director of trusts and estates at Sontag Advisory, a financial planning firm, tells USA Today retirement columnist Rodney Brooks.

When doing an estate plan, the article on newsmax.com, titled “USA Today: Don't Neglect Estate Plan as Part of Retirement Strategy,” offers some sound advice:

• Make sure an estate planning attorney examines every major financial document;
• Sign a healthcare proxy, living will and power of attorney; and
• Discuss all estate issues with your family, even if it’s uncomfortable

"Estate planning is intertwined with the financial plan," the article explained, and it’s no secret that many individuals fail to prepare for retirement. Those that do plan on their own make some major mistakes, and here are two:

1. Skimping on savings. The article cites a recent retirement survey in which about 50% of the near-retirees who were asked what they could have done to better prepare for retirement said they should have saved more. The more and earlier you start saving, the more your money can grow.
2. Overpaying for investments. The more you pay in investment fees, the less you have to benefit from compounding.

"The costliest errors are ones we make ourselves, often without realizing how much damage we're doing," the author notes.

Don’t make any major or minor mistakes when it comes to your future. Talk to an experienced estate planning attorney.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: newsmax.com (April 10, 2015) “USA Today: Don't Neglect Estate Plan as Part of Retirement Strategy”

Financial Planning for Millennials

Rachel Lake had worked with financial planners before, but the relationship didn't click until the Millennial began working with an adviser who focuses his message, and methods, on her generation. "It's more like a partnership,'' said Lake, 32, who is a home loan specialist living in Boston. “You want your personal trainer, your CPA and you want your financial adviser but I want somebody to be there more as a coach than as someone telling me what I should be doing. Because I don't feel like I'm on a traditional path, and I don't think I'm alone in that. ... (Millennials) want someone that sees us as individuals rather than as a stereotypically corporate worker.''

The USA Today article, “For Millennials goal is financial freedom,” says that when it comes to mapping out financial futures, some financial planners are finding that Millennials prefer to work with those who understand their generation. This is a group that’s probably going to have several jobs in their lifetime and is used to being able to get answers with the click of a button.

Many Millennials also may have a ton of student debt and may have had trouble finding a job which means that the financial strategies that worked for their Baby Boomer or Gen X parents might not fit their circumstances.

The article quotes one financial planning firm that targets Millennials. That firm noted that traditionally financial firms have emphasized the management of assets; however, the average Millennial doesn’t have much in terms of assets and is just starting his or her career. To appeal to Millennials, this firm bills itself as a "personal trainer''—guiding clients to financial health. For young professionals, these experts say that financial freedom to chart their own course is a higher priority than saving money for retirement. Likewise, the article explains that purchasing a home is also not always a top priority to younger adults who may prefer urban living, or need to relocate to chase their professional goals.

Even with these less concrete plans, having a strategy for the future and a way to finance the dreams and ambitions of a Millennial are critical. Take the time to speak with an experienced estate planning attorney who can guide you to your other qualified professional “coaches” to help you chart your course in life.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: USA Today (April 11, 2015) “For Millennials goal is financial freedom”

The Estate of Mr. Cub Already in Foul Territory

Widely beloved in Chicago and the baseball world, Ernie Banks — a/k/a Mr. Cub — rose from humble beginnings.  He began his career earning seven dollars a day in the Negro Leagues, before crossing the color barrier and becoming the Chicago Cubs’ most popular player ever.  After his playing career, Banks has been widely respected as a positive role model in baseball and beyond.  He continued to break new ground, becoming the first black Ford Motor F -0.18% Company dealer ever and being actively involved in charity work throughout his life after baseball.  In 2013, President Obama awarded Banks the National Congressional Medal of Honor. Ernie Banks died on January 23rd at age 83 from a heart condition.  Interestingly, his death certificate listed dementia as a “significant condition contributing” to his death.  Why is that important?

Just a few months before he died, Ernie Banks signed a new set of estate planning documents, including a power of attorney, healthcare directive, new will, and a trust. These documents left his caregiver and talent agent, Regina Rice, in control of everything. This new will and trust totally left out his family members and named Rice as his sole beneficiary. Rice would stand to inherit not only whatever assets and wealth Ernie Banks accumulated during his life, but the right to control (and profit from) his name, likeness, and image. 

Banks’ children say they will take her to court to keep that from happening.

Forbes reports in a recent article, titled “Estate of Ernie Banks In Turmoil As Caregiver Claims To Be Sole Heir,” that the Banks children are claiming Rice coerced their father to sign the new estate planning documents, by controlling and manipulating him, using her position of trust and confidence to take advantage of his dementia to their detriment.

The parties already have been slugging it out over Mr. Cub’s wishes. Banks said in multiple past interviews that he wanted to be cremated when he died and have his ashes spread over Wrigley Field. His ex-wife, along with his children, sued to stop the cremation and won the right to have Banks buried. Interestingly, even though the couple was estranged and in the middle of divorce proceedings, Banks’ wife still was considered his next of kin, which gave her the right to control his burial arrangements.

As far as the fight over controlling his image and inheriting his assets, the Forbes article points out that it will certainly be much more complex and drawn out than the duel over how to bury the baseball great. Individuals can leave their assets to whomever they want, but they must be of sound mind and free from what the law calls “undue influence.” Families often fight over whether a will truly represented the decedent’s wishes, or whether it was signed under coercion, manipulation, fraud, or other improper influence.

Since Rice was in a position of trust over Banks, the law says that it is assumed on a preliminary basis that she did exercise undue influence. She’ll need to show that she did not commit undue influence, instead of the children being required to prove she did.

Although it remains to be seen how this will end, it’s already certain that this is a tragedy for the legacy of a baseball icon. Unfortunately, this isn’t uncommon. This type of fighting and court action occurs frequently up and down the economic ladder.

You can prevent an estate battle in your family with the help of an experienced estate planning attorney long before a loved one has dementia or is possibly mentally incompetent.

Reference: Forbes (February 19, 2015) “Estate of Ernie Banks In Turmoil As Caregiver Claims To Be Sole Heir”

Special Elder Abuse Prosecutor Proposed in Oregon

Older Oregonians who are vulnerable to financial and physical abuse would have a new ally if the Legislature agrees to finance a new state prosecutor who would focus on assisting county district attorneys with prosecuting elder abuse cases. The elder abuse resource prosecutor would be in the Oregon Department of Justice's Criminal Justice Division. The person named to the proposed position would be the third full-time resource prosecutor in the state, alongside those for domestic violence and driving under the influence of intoxicants.

A recent article in The Oregonian, titled “State prosecutor for elder abuse is proposed for Oregon,” says that in recent years the number of suspected and confirmed cases of elder abuse has been steadily increasing in that state. In fact, in 2013, the Oregon Adult Protective Services received 28,449 reports of potential abuse involving older adults and people with physical disabilities.

Funding for the new full-time position is being requested as part of the Oregon Department of Justice's appropriations bill, which is moving through committees.

The director of consumer education and outreach for the Department of Justice said in the article that "[t]here's a gap there and we want to fill that with the prosecutor and the two investigators."

Likewise, a former county elder abuse prosecutor in Georgia told The Oregonian that it makes sense to create a position at the state level if a state has a significant rural population. "Then you've got the resources that could reach out to a small rural area that would never ever be able to afford a specialty prosecutor," the former prosecutor said.

The article explains that victims of elder abuse are two times as likely to die within a year of the abuse being reported than those elders who haven’t been the victim of abuse, citing research published in the Journal of the American Medical Association.

In the more than 28,000 complaints of potential abuse in Oregon in 2013, the state deemed 14,250 worthy of investigation. It confirmed 5,024 victims of abuse, wrongdoing, or self-neglect. The number of abuse complaints has been increasing as Oregon's senior population grows, according to the report. Growing awareness of the issue of elder abuse also is a factor.

The senior population is growing in many other states as well. Talk with a qualified elder law attorney if you have questions or want to take action to protect a loved one.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: The Oregonian (April 3, 2015) “State prosecutor for elder abuse is proposed for Oregon”

Two Uncomfortable Topics: Death and Debts

When a loved one dies, is it possible to inherit their debt? It's a serious question for heirs, and particularly for couples who hold debt jointly. In most cases, a deceased person's debts fall to their estate for payment. However, depending on state law, shared credit relationships and the amount of debt in question, surviving family members may be shocked to learn that they could be legally liable for remaining debt that they weren't aware of or had expected their loved one's estate to cover. That's why it's wise to include debt planning in individualized estate planning as early as possible.

A recent article in The Huffington Post, titled “Debt and the Deceased: How Should Spouses and Heirs Proceed?,”offers some thoughts to consider when planning ahead.

Be honest about your financial situation. It’s not that easy for some family members to discuss debt issues, especially older Americans who hoped for better at the end of their lives. Even so, parents and their adult children or spouses should thoroughly talk about any outstanding debts that could affect the borrower's estate.

Get qualified advice. It’s easy to see that a young couple probably has a different set of debt issues than a retired couple. The article advises borrowers to speak with a qualified estate planning expert for ways to extinguish or manage debt issues as part of current financial and estate planning.

Organize your documents. The article urges you to consolidate all of your loved ones’ important financial documents in one centralized location. Ideally, all of the asset, debt, and tax documents would be included in an organized filing system… and it needs to be kept current!

See what needs to be repaid. It’s important for borrowers and their executors to know what categories of the deceased's debts will most likely need to be repaid after his or her death and which ones might be canceled. Some types of unsecured debt held in the deceased's name alone, such as credit cards or federal student loans, typically may be discharged.

Educate the executor. The article reminds us that collection agencies have the right to try to collect on any outstanding debt they are hired to pursue—even when the survivors may not be legally bound to pay the debt. You’ll need to know what debt is left behind and whether the estate or individual family members might be liable. An experienced estate planning attorney can help. Once this is done, the executor should be told of this, and if possible, the borrower should leave good notes about how the executor should respond.

Be prepared and review estate plans to address current credit issues and create an action plan for any remaining debt after the borrower dies.

Contact John M. Lane Law, PLLC to discover the Simplified Solution to your estate planning needs. Everyone has an estate, no matter how large or small, complex or simple.  For more information about how we can help you, visit our website at www.JohnLaneLaw.com.

Reference: The Huffington Post (April 1, 2015) “Debt and the Deceased: How Should Spouses and Heirs Proceed?”