Joke of the Week

Excerpt from the classified section of a city newspaper:

Dog for sale: eats anything and is fond of children.

Movie Review: Snowball Express

Here is another inheritance movie. Disney's classic, Snowball Express (1972), is just plain fun. The story is about the crazy adventures a family has when they move to Colorado to try and make an inherited run down hotel a success. Of course, there are the good and bad guys and the ultimate "snowmobile" race to see which side wins.

The movie can be found here.

Moving To A New State With Estate Documents In Place

If you have estate documents (wills, trusts, powers of attorney, etc.) and you move to a new state, it is always good to have an estate planning attorney in the new state review your documents. A general rule of thumb is wills and trusts will less likely need to be amended with a move to a new state. Powers of attorney, especially health care, will more likely need to be amended to meet the new state's requirements.

Definition of the Week: Simple Distribution Plan

Simple Distribution Plan: A simple distribution plan calls for immediate distribution of assets to your beneficiaries at your death. A simple distribution plan is relatively easy to draft and can sometimes be done without a trust. Because it is easier to prepare, a simple distribution plan is less expensive than a complex distribution plan.

Basic Stages of Life

There are three basic stages of life. Different estate documents are used for each stage of life.

The first stage of life is when an individual is alive and mentally competent. At this point in a person's life, not estate documents are necessary. However, this is the time an individual should put estate documents in place for the next two stages of life.

The second stage of life is when an individual is alive and mentally incapacitated. At this point, powers of attorney can be used to establish authority and begin acting for a person in the second stage of life. If powers of attorney have not been created, an individual seeking authority to act for a mentally incapacitated person must petition a court for that authority in a guardianship/conservatorship proceeding.

The third stage of life is when an individual dies. Once someone dies, the powers of attorney or a guardianship/conservatorship ends. At the point of death, trusts and/or wills are then used to establish authority and distribute a deceased person's estate to beneficiaries. If there is not a properly funded trust or there is only a will or there is no will at all, most likely authority to act on behalf of a deceased person must be sought through the probate court.

Joke of the Week

Neighbor: "Where are you going Beatrice?"

Great Aunt Beatrice: "To see my Arithmetic Relatives."

Neighbor: "Why do you call them that?"

Great Aunt Beatrice: "Because they add to my misery, they subtract from my pleasure, they divide my attention, and they multiply like the dickens."

Movie Review: Scavenger Hunt

Here's an inventive way to give away your estate. Have your relatives participate in a scavenger hunt where the winner inherits all. Scavenger Hunt (1979) is exactly that. In this comic movie, the relatives and even the servants compete for the prize: the $200 million dollar estate.

Check out this review.

The Mummy Bequest

It is a personal decision whether or not you want your body donated at your death as organ transplants or even for medical research. In recent years it has become more and more common for individuals to make these kinds of donations. Alan Billis, a former British taxi driver, donated his body for scientific research. What makes his end-of-life bequest unique is that he donated his body to be mummified in the same way the pharaohs were mummified. In fact, the mummification process on Mr. Billis will become a documentary titled Mummifying Alan: Egypt's Last Secret. His family was supportive of Mr. Billis's decision and joke about their claim to a real live mummy in the family.

Read more about it here.

Definition of the Week: Complex Distribution Plan

Complex Distribution Plan: A complex distribution plan requires at your death that your assets be distributed over time, in certain amounts, or under certain conditions. A complex distribution plan is generally more difficult and time consuming to draft than a simple distribution plan. A complex distribution plan requires use of a trust. A complex distribution plan is more expensive to prepare than a simple distribution plan. Hundreds of reasons exist for Complex Distribution Plans.

William Shakespeare and Edward De Vere's Estates

No matter which side you take--William Shakespeare is "the" William Shakespeare or Edward De Vere is "the" William Shake-speare--it is of interest to look how their heirs inherited each of their estates.

The Stratfordian Shakespeare's Will

William Shakespeare of Stratford prepared a will before he died.

To his daughter Judith he willed:
- 100 pounds for a marriage portion and another 50 pounds if she renounced any claim to the Chapel Lane cottage.
- An additional 150 pounds if Judith lived another three years, but forbade her husband any claim to it unless he settled on her lands worth the 150 pounds.
- If Judith did not live another three years, the 150 pounds was to go to Shakespeare's granddaughter Elizabeth Hall.
- A silver bowl
To is sister, Joan Hart, he willed:
- 30 pounds
- Life estate with nominal rent in the Western of the two houses on Henley Street, which Shakespeare himself inherited from his father in 1601.
To Joan Hart's sons, his nephews, he willed:
-5 pounds to each of Joan's three sons.
To his granddaughter, Elizabeth Hall, he willed:
- All his silver plates, except the silver bowl left to Judith.
To the poor of Stratford he willed:
-10 pounds to the poor of Stratford.
To his friends he willed:
- His sword and various small bequests to local friends.
- Memorial ring to be bought for his lifelong friend Hamnet Sadler
- Memorial rings to be bought for John Hemynges, Richard Burbage, and Henry Cundell
To his wife, Anne, he willed:
- His "second best bed."
To his daughter, Susanna and Son-in-Law, John Hall, he willed
- "All the Rest of my Goods, Chattels, Leases, Plate, Jewels & Household stuff whatsoever after my debts and Legacies paid & my funeral expenses discarded."

Oxfordian Shake-speare's Estate

Edward De Vere was the 17th Earl of Oxford. He inherited the Oxford estate when his father died. Titled property usually was inherited by the oldest son in a nobleman's family. Edward De Vere had only one living son, Henry, from his second wife, Elizabeth.

Edward did sell some of his estate during his life, and established a trust fund for his three living daughters from his first wife, Anne. His three daughters, Elizabeth, Bridget, and Susan all married men of title as well.

The remaining estate went to his second wife, Elizabeth, and his son, Henry, who became the 18th Earl of Oxford.

Joke of the Week

It usually takes five years for a tree to produce nuts, but this isn't true of a family tree.

Book Review: Special Needs Trust Administration Manual: A Guide for Trustees

Special Needs Trust Administration Manual: A Guide for Trustees, written by Barbara Jackins, with contributors Richard Blank, Peter Macy, Ken Shulman, and Harriet Onello, covers everything a trustee of a special needs trust needs to know in administering a special needs trust.

It is crucial that a trustee, especially if it is a family member of a special needs individual, understands how to spend special needs trust funds appropriately so that a special needs individual's government benefits are not harmed. It is also important for the trustee to report to government agencies how special needs trust funds were spent. This guide for trustees can be helpful in preventing mistakes that could cost a special needs individual dearly.

You can review the book here.

"Portability" of Estate Tax Exemption to Spouse

"Portability" as mentioned in the October 8-9, 2011 Wall Street Journal "allows a surviving spouse in effect to roll over the unused portion of a deceased spouse's [estate tax] exemption."

Ms. Saunders in her Wall Street Journal article mentions that the IRS has clarified what needs to be done if a spouse wishes to carry over the deceased spouse's unused estate tax exemption to their own estate. She indicates that the IRS has done some clarifying, but it will only apply to 2011 and 2012 unless Congress applies the same estate tax provisions to future years.

One important point is that even if the deceased spouse has a small estate, an estate tax return must be filed nine months after the individual has died, with a six month filing extension available, in order for a spouse to take advantage of the portability option.

If you are married, it is a good idea to become familiar with what is required in order to take advantage of the portability option.

Read the Wall Street Journal here.

Definition of the Week: Fiduciary/Fiduciaries

Fiduciary/Fiduciaries: A fiduciary is an entity or person who manages your affairs if you are incapacitated or deceased. The word fiduciary is a general term referring to agents, personal representatives, or trustees.

What About Steve Jobs's Estate Planning?

Now that Steve Jobs has died there is speculation in the news regarding what place in technology ingenuity Apple, Inc. will play in the future. A less public issue of speculation is what will happen to Mr. Jobs's estate. Mr. Jobs during his life has been private regarding his philanthropy endeavors. Laurene Powell Jobs, Steve Jobs's widow, has very quietly been involving herself with education issues, women's issues, and other philanthropic causes. Two organizations founded by Ms. Powell Jobs are College Track and Emerson Collective. Both organizations strive to help individuals help themselves. Most likely, Ms. Powell Jobs will continue using Mr. Jobs's estate to further philanthropic causes important to both Ms. Powell Jobs and her deceased husband, Steve Jobs.

From our perspective as estate planners, the critical point is that Mr. Jobs seems to have done his estate planning right. We can say this because so little is being said (can be said) about it in the news. It seems everything has been done privately, confidentially, and competently. No news in estate planning is good news.

Here is an article with the Wall Street Journal touching on this issue.

Joke of the Week

"Oh yes," said Mrs. Lowell-Cabot, proudly, "we can trace our ancestors back to-to-well, I don't know exactly who, but we've been descending for centuries."

Movie Review: Greedy

The movie Greedy (1994, rated pg-13) is about an extremely wealthy uncle (Kirk Douglas) who knows his greedy relatives (Ed Begley, Jr., Phil Hartman, Michael J. Fox) want his money. He puts them through various tests including hiring a beautiful nurse from England. While watching the fun, it is of interest to see all the estate planning issues a family can actually go through.

Steve Jobs's Death

Steve Jobs passed away yesterday, Wednesday, October 5, 2011. We want to add our voice in expressing appreciation for what Mr. Jobs did in the field of computers. Our law business has greatly benefited by his products. Here is an article that mentions ten Apple computer products that helped change the world. The Wall Street Journal has a nice article as well. We wish his family well during this time of loss.

A Few Non-Tax Reasons For Using Insurance In Estate Planning

Often life insurance is used to offset estate taxes when an individual with a large estate dies. There are actually many non-tax reasons to use life insurance in estate planning whether or not an individual has a large estate. Here are a few non-tax reasons for using life insurance in estate planning:

• Special Needs Planning (e.g. fund a special needs trust for a special needs child)



• Estate Equalization (e.g. ensure each child has an equal inheritance when an estate owns an asset that is not easy to divide equally, like a business)



• Charitable Giving (e.g. money set aside to be given to a favorite charity of the deceased person)



• Special Planning or Purposes (e.g. fund children's education or other specific purposes)



• Maintain Family Assets (e.g. family cabin expenses)



• Income Replacement When Children Are Minors (e.g. one spouse dies and children are still minors)



• Income Replacement For Children Of Dual-Income Households (e.g. spouse dies second income is required to survive financially.)



• Business Exit Strategies (e.g. buy-sell agreements)



• Enrich Estate Upon Death (e.g. wish children to have a larger inheritance)



• Pay Outstanding Debt Still Owed After Death (e.g. pay off mortgage on home)

As mentioned above, there are a lot of non-tax reasons to include insurance when doing estate planning.

Definition of the Week: Third Parties

Third Parties: The best way to define a "third party" is with an example.

Suppose you decide to give your car to a friend. You deliver to your friend the signed title and the keys. In this transaction, you are the first party. Your friend is the second party. And the Division of Motor Vehicles or DMV, where the new title must be recorded, is the third party. The DMV is not a party in the transaction between you and your friend, but they are involved in recording the transaction.

A third party is a "person who is not a party in a transaction or agreement, but is involved in or affected by the transaction or agreement." (Black's Law Dictionary)

The importance of third parties in Asset Transfer Planning cannot be underestimated. These third parties include county recorders, banks, motor vehicle divisions, investment firms, life insurance companies, transfer agents, retirement fund custodians, and others. To transfer ownership of assets, you, your fiduciaries, and your beneficiaries have no choice but to work with these third parties and comply with their policies and rules.

Purpose Of Estate Planning

The purpose of estate planning is to transfer assets to beneficiaries at the times and in the manner desired by the owner efficiently, with minimal taxes, and without conflicts. This concise definition of the purpose of estate planning involves a lot of issues. The individual participating in estate planning must gain an understanding of all the issues. Look at the following site for an in-depth introduction to the various issues involved with estate planning.

Joke of the Week

"My grandfather plays the piano by ear."

"Well, if we must boast--my grandfather fiddles with his beard."