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Law Office of Emily J. Buchbinder • January 4, 2019
Does Your Trust Still Fit?
Many couples who had estate plans prepared prior to 2011 have trusts that require that the assets be divided into two separate trusts on the first death. Trusts were drafted this way to maximize the value of assets that could be passed down to children without estate tax. The tax law changed in 2011, and it is no longer necessary to divide trust assets on the first death to preserve the amount a couple can pass to their children free of the estate tax. If you have this type of trust, then you are legally required to divide your assets into two trusts when the first spouse dies. However, you can avoid this requirement by amending your trust during your joint lifetimes. This type of trust is still appropriate for some people, but you should discuss your situation with your attorney.
How Old Is Your Durable Power of Attorney?
A Durable Power of Attorney gives your agent (“attorney in fact”) the power to help you with financial aspects of your life that are unrelated to your trust assets (checking accounts, retirement plans, insurance, billing queries, etc.). Many financial institutions refuse to acknowledge the validity of “stale” documents. If your Durable Power of Attorney was executed more than four years ago, then you should have it updated.
Most Frequent Mistakes People With Trusts Make
If you have a trust, congratulations on planning to avoid having your estate probated. One common mistake people with trusts make, however, is that they do not properly fund their trusts. Your real property, investment accounts, money market accounts, savings accounts, and CDs should be titled in the name of your trust. If you die with more than $150,000 of assets outside of the trust, then your successor trustee will have to petition the court to gain access to those funds.
Remember that retirement accounts can never be titled in the name of a trust because only individuals can own them. Make sure you have beneficiaries named on your retirement accounts.
Another common mistake is having your documents prepared and putting them away forever. Laws change and circumstances change. It is important to have your trust reviewed every five years.
In the serene surroundings of Santa Cruz, California, understanding and navigating the realm of estate planning is crucial for ensuring that your wishes are honored and your loved ones are cared for. At The Law Office of Emily J. Buchbinder, we recognize that estate planning is not just about drafting documents—it's about building a framework for your future and ensuring peace of mind for both you and your family. Here’s how to get started and why understanding estate planning is essential. The Foundation of Estate Planning Estate planning involves preparing for the management and distribution of your assets after your death. It’s about more than just assigning who gets what; it’s about making informed decisions that reflect your wishes, values, and goals. At The Law Office of Emily J. Buchbinder, we guide you through this process with clarity and dedication, helping you establish a plan that meets your unique needs and circumstances. Why Understanding Estate Planning Matters Estate planning can seem daunting due to its complexity and the personal nature of the decisions involved. However, understanding the fundamentals can significantly ease the process. Estate planning involves creating legal documents such as wills, trusts, and powers of attorney. Each serves a specific purpose: wills outline your wishes for asset distribution, trusts can provide for more flexible and efficient management of your assets, and powers of attorney allow you to appoint someone to make decisions on your behalf if you become incapacitated. Our team at The Law Office of Emily J. Buchbinder helps demystify these concepts, ensuring that you are informed every step of the way. Building Confidence Through Knowledge An informed client is a confident client. When you understand the estate planning tools available to you and how they will impact your legacy, you can make decisions with greater assurance. Transparency is at the heart of our approach. We take the time to explain the implications of various estate planning strategies, ensuring you feel secure in your choices and are aware of how they align with your long-term goals. Ensuring Ethical and Effective Planning Estate planning isn’t just about legal documents; it’s about ensuring that your wishes are honored and that your family is protected. Ethical practice is a cornerstone of our work at The Law Office of Emily J. Buchbinder. We provide honest and straightforward advice, helping you navigate the complexities of estate planning while adhering to the highest standards of integrity. Reducing Anxiety Through Clear Communication The process of planning for the future can be emotionally charged and stressful. Our role is to alleviate that stress by offering clear, empathetic guidance. By outlining your options, setting realistic expectations, and addressing any concerns you might have, we help reduce uncertainty and anxiety, making the process smoother and more manageable. Facilitating Comprehensive and Personalized Planning Effective estate planning requires a personalized approach. At The Law Office of Emily J. Buchbinder, we understand that each individual’s situation is unique. We work with you to create a customized plan that reflects your specific needs and goals, ensuring that all aspects of your estate are covered comprehensively. Encouraging Long-Term Relationships Building a lasting relationship with your estate planning attorney can provide ongoing peace of mind. Transparency and trust are key components of this relationship. We aim to be your long-term partner in navigating estate planning and any future needs that may arise, ensuring that you have a reliable and knowledgeable advocate by your side. Starting with estate planning is an important step toward securing your future and protecting your loved ones. At The Law Office of Emily J. Buchbinder, we are dedicated to guiding you through this process with transparency, integrity, and expertise. If you are ready to begin your estate planning journey or have any questions about how to proceed, contact us today. We are here to help you every step of the way.
The probate process can be daunting and emotionally challenging. At The Law Office of Emily J. Buchbinder, we provide compassionate and comprehensive probate services to help you navigate this complex legal journey. Here’s how we assist you during this difficult time. Understanding Probate Probate is the legal process of validating a will, settling debts, and distributing assets to beneficiaries. Our firm explains each step of this process in plain language, ensuring you understand what to expect and how to proceed. Efficient Estate Administration We handle all aspects of estate administration, from filing necessary court documents to managing estate assets. Our goal is to streamline the process, reducing delays and ensuring efficient resolution. Managing Debts and Taxes Settling an estate involves addressing outstanding debts and taxes. We meticulously review and manage these obligations, ensuring they are paid in accordance with the law and that the estate is closed efficiently. Providing Emotional Support The probate process often coincides with a period of grief and loss. We approach each case with empathy and sensitivity, providing not only legal support but also understanding and compassion during this challenging time. At The Law Office of Emily J. Buchbinder, we are dedicated to providing expert legal services in estate planning, trust administration, and probate. Our commitment to transparency, personalized attention, and ethical practice ensures that our clients receive the highest quality legal support. Contact us today to learn how we can assist you with your legal needs in Santa Cruz, California.
In the picturesque city of Santa Cruz, California, navigating the intricate landscape of taxation laws requires more than just legal expertise—it demands transparency, trust, and a commitment to client education. At The Law Office of Emily J. Buchbinder, we pride ourselves on these core values, ensuring that our clients not only receive top-notch legal advice but also understand every step of the process. Here’s why a transparent taxation lawyer is indispensable in today’s legal environment. Building Trust through Transparency Taxation law is inherently complex, often shrouded in dense legal jargon and ever-changing regulations. For many clients, this can be overwhelming and intimidating. A transparent taxation lawyer demystifies this complexity by breaking down legal terms and explaining processes in a clear, comprehensible manner. At The Law Office of Emily J. Buchbinder, we believe that when clients understand their tax situation, they can make informed decisions that best serve their interests. Enhancing Client Confidence Transparency fosters confidence. When clients are aware of the legal strategies being employed on their behalf and understand the reasoning behind them, they are more likely to feel secure and reassured. This confidence is crucial, particularly when dealing with sensitive matters such as tax disputes, audits, or intricate tax planning. Our firm ensures that clients are kept in the loop with regular updates and open communication, reinforcing their trust in our services. Ensuring Ethical Compliance The legal profession holds a significant responsibility to uphold ethical standards. Transparency is a key component of this ethical obligation. By being transparent, taxation lawyers can ensure that their actions are above board and in the best interest of their clients. This commitment to ethical practice is a cornerstone of The Law Office of Emily J. Buchbinder, where we prioritize integrity and honesty in all our dealings. Reducing Uncertainty and Anxiety Tax issues can cause considerable stress and anxiety. Uncertainty about potential outcomes, unexpected tax liabilities, or unclear legal advice can exacerbate these feelings. A transparent taxation lawyer alleviates these concerns by providing clear explanations, setting realistic expectations, and outlining potential outcomes. This approach helps clients feel more in control and less anxious about their financial and legal future. Facilitating Effective Planning Effective tax planning is essential for both individuals and businesses. A transparent taxation lawyer not only assists in compliance and dispute resolution but also plays a pivotal role in strategic planning. By clearly communicating the implications of various tax strategies, lawyers can help clients optimize their financial decisions, minimize liabilities, and capitalize on available opportunities. At The Law Office of Emily J. Buchbinder, we strive to empower our clients with the knowledge they need to make proactive and beneficial tax-related decisions. Encouraging Long-term Relationships The legal relationship between a lawyer and their client should ideally be long-term, built on mutual respect and trust. Transparency is the foundation of such relationships. When clients know they can rely on their lawyer to be open and honest, they are more likely to return for future legal needs and refer others. Our firm values these enduring relationships and works diligently to cultivate them through transparent and reliable legal counsel. In the realm of taxation law, transparency is not just a virtue—it is a necessity. At The Law Office of Emily J. Buchbinder, we are committed to providing our clients with transparent, ethical, and informed legal services. Our approach not only ensures compliance and effective representation but also builds the trust and confidence that our clients deserve. If you are seeking a taxation lawyer in Santa Cruz who values transparency and client empowerment, look no further. Contact us today to learn how we can assist you with your tax-related needs.
In 2021, a U.S. citizen may transfer up to $11.7 million to a non-spouse without federal estate tax. This amount is indexed for inflation each year through 2025. On January 1, 2026, this law sunsets, unless Congress and the President make this law permanent. If the law sunsets, the estate tax exemption amount will revert to 2017 levels when the estate tax exemption was $5.49 million per person. However, this amount will be indexed for inflation from 2018 through 2025.
If your trust requires a division of assets into two sub-trusts on the death of the first spouse, your current trust may no longer suit your needs. (Look to see if your trust mentions a Bypass Trust, “B” Trust, Exemption Trust, Marital Trust, or Family Trust). Many couples created their trusts before 2011 when there was a dramatic change in the tax code. In addition to higher exemption amounts (the amount of money individuals can gift their children and non-spouse beneficiaries during life and at death), the manner in which couples can transfer that wealth also changed. Prior to 2011, married couples were required to divide assets into two separate trusts when the first spouse died to preserve the amount the deceased spouse could pass to his or her children without estate taxes. The downside to dividing assets on the first death is that it requires that the surviving spouse allocate assets between the two trusts and retitle all the assets. In addition, the surviving spouse must file an annual tax return for the trust that holds the deceased spouse’s property. The assets in the deceased spouse’s trust receive a new cost basis (fair market value). However, the assets in the deceased spouse’s trust do not receive another step-up in basis when the surviving spouse dies. Only the assets in the surviving spouse’s trust receive a stepped-up basis.
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