Lifetime Gifts May Have Significant Tax Advantages

Posted November 30, 2010 in Estate Planning by Michael Lonich.

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November 30, 2010
Lifetime Gifts May Have Significant Tax Advantages
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An estate planning attorney can help you develop a plan that maximizes your assets and helps you take advantage of the estate and gift tax system.  If you are considering leaving an asset to someone upon your death, you may be interested in learning about the tax benefits of an “inter vivos” gift.  An inter vivos gift is a gift that is transferred during the giver’s lifetime.

Lifetime gifts have several tax advantages.  These advantages are particularly helpful to individuals whose estate will likely be subject to federal estate taxation.  Also, lifetime gift plans are particularly important for people whose estates will exceed the applicable estate tax exclusion ($3.5 million for decedents dying in 2009).

The main advantage of an inter vivos gift is that some, or all, of the gift may not be subject to transfer tax.  The Internal Revenue Code provides that individuals may make gifts of $13,000 per year per donee without incurring gift tax liability and without having to file a gift tax return.

In addition, interspousal gifts provide the donee spouse with an adequate estate and also allow the donee spouse to use his or her annual exclusions and estate and gift tax exclusion amounts.  The gift tax marital deduction is unlimited for a donee spouse who is a United States citizen.  For non-citizen spouses, there is an inflation adjusted annual gift tax exclusion that totaled $128,000 in 2008.

For more information about lifetime gifts, please contact us.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

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Are You Divorcing? Here is What Not to Do Online

Posted November 23, 2010 in Family Law by Eric Despotes.

Divorces are difficult and trying events.  Don’t add to the stress of the experience by making some common mistakes with your social networking.  Recently, a Time magazine article discussed the implications that social networking can have on a person’s divorce case.  The article noted that it is now commonplace for divorce attorneys to use information gathered on social networking websites to bolster their case against their client’s ex-spouse.  Information gleaned from social networking sites can be used to catch spouses in lies and improper behavior.  This information can affect the outcome of asset distribution, child custody, child support, spousal support, and other important divorce issues.  For the full Time article, please click here.

If you are a member of Facebook, MySpace, Twitter, or other social networking websites, you should be very careful about what you post online.  Do not post information relating to marital property, spousal support, child custody/care, or other personal information that may be relevant to your divorce case.

For more information about California divorces, please contact the divorce attorneys at Lonich & Patton.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

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The Proper Estate Plan May Help You Avoid the Expense and Hassle of Probate

Posted November 23, 2010 in Estate Planning by Michael Lonich.

If you are trying to decide what estate planning instruments you need in order to meet your goals and to avoid the cost of probate, you might want to look into the revocable trust.  A revocable trust is the primary testamentary transfer device used by professional estate planners in California.  A revocable trust can be used not only to manage your property during your lifetime, but it also serves to distribute your assets upon your passing.

There are several key advantages of a trust.  First, it avoids probate.  Probate is the court-supervised process of distributing a deceased person’s assets according to their will or California intestacy law.  This process can sometimes take over 6 months to complete and can be expensive.  For example, the estate of a person with only a will operating to distribute their assets after death would have to carry the costs associated with providing and preparing the initial petition, petitions for instructions, and the petition for final distribution.  In addition, costly court hearings to discuss creditor (and other) issues may be required.

Second, a trust can help to maintain confidentiality regarding your assets.  Probate proceedings are a part of the public record.  This means that anyone is able to access the information in the record regarding your assets and their distribution.  If privacy is important to you, a trust can help you achieve greater (but not necessarily complete) confidentiality.

Third, a trust also serves property management functions during your lifetime.  With a trust in place, there is no need to incur the costs and inefficiency associated with a formal conservatorship in the event of your lifetime disability or incapacity.  In addition, a trust is useful as it provides for long-term continuity for handling your assets.

For more information about wills and trusts, please contact our San Jose estate planning lawyers at Lonich & Patton for more information.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

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There are Several Different Avenues for Pursuing a Child Support Order in California

Posted November 23, 2010 in Family Law by Mitchell Ehrlich.

Child support is a certain amount of money that a court instructs one parent of a child to pay the other parent.  The court’s instruction is detailed in a document called a child support “order.”  The child support money is used to financially support the child.  If you are having difficulties supporting your child after a divorce, or if the other parent is not pulling his/her weight, you may want to contact a family law attorney for advice.

First of all, if you have been the victim of domestic violence by the other parent you may ask for child support when you are seeking a domestic violence restraining order.  If you are married or in a registered domestic partnership and have a child from that union, you can also seek child support as part of a dissolution of that marriage or domestic partnership.  The legal procedures differ slightly depending on whether or not you are married or in a domestic partnership with the other parent of the child.  Regardless, the procedures all lead to the same result, a child support order.  In order to begin this process, you must file a court case.  After you file the case, the court may then decide to grant you the order for child support.  In addition, if you do not want to file for divorce or legal separation, you can file a Petition for Custody and Support of Minor Children and Summons.  This also allows you to seek child support from your spouse.

If you are not married to, or a domestic partner of, the other parent, you may ask for child support in different instances.  First, you may ask for child support if you file a parentage case to determine who the legal parents of the child are.  Second, if you have signed a voluntary Declaration of Paternity, you may choose to file a petition for Custody and Support of Minor Children as well.

If you are confused about what is your best option for successfully obtaining child support from your ex-spouse, you may need professional guidance.  Please contact us for more information.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

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Selecting a Successor Trustee for Your Revocable Trust

Posted November 22, 2010 in Estate Planning by Michael Lonich.

A “trustee” is a person who is responsible for managing the trust assets.  Many individuals choose to name themselves as the trustee of the trust so they can exercise control over the trust during their lifetime.  In addition, it is wise to add a successor trustee who will manage the trust assets if you ever become incapacitated or die.

When choosing a person to serve as your trustee or successor trustee, make sure you pick someone who is reliable and honest.  The trustee has a vast amount of authority and will not be required to act under the court’s direct supervision.

Just recently, the individuals in charge of the estate of 104 year old heiress, Huguette Clark, have come under attack for some questionable dealings with her estate.  A criminal investigation is pending regarding the attorney and accountant in charge of handling Clark’s money.  The investigation is looking into the sale of her Stradivarius violin for $6 million and a Renoir painting for $23.5 million.  Click here for the full article.

To learn more about successor trustees, please contact us.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

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