A client recently presented me with the following factual situation. Her father, a California resident, had approximately $150,000 of stocks held in his individual name at the time of his death. His wife (the client’s mother) survived him, and the stocks were acquired during the marriage using community property funds. Her father had written a Will, but no Living Trust. The company issuing the stocks would not transfer title of the stock to the surviving spouse, even though it was presented … [Read more...] about Stocks in the Name of Deceased Spouse
Optional Claims Procedures for Trust Administration
One of the major advantages of having a living trust is that upon death, assets of the trust are not subject to the probate process. But occasionally there are situations where probate might be an advantage. One of those would be where the decedent has legal obligations that are unknown or undefined. The decedent's creditors would have a right to bring suit to collect on their claims against the trust for one year after the decedent's death. If the decedent's estate were being probated, the … [Read more...] about Optional Claims Procedures for Trust Administration
Use of a Special Needs Trust to Shelter an Inherited Home
I was recently asked to address the following fact situation. Mother is elderly and in failing health with limited assets other than the family home. Should she need to be admitted to a skilled nursing facility, it is likely Medi-Cal would end up footing the bill. Daughter is disabled, receives public assistance and wants to know if there is any way she can inherit the home without impacting her public benefits. My response was as follows: If your mother goes into a skilled nursing facility … [Read more...] about Use of a Special Needs Trust to Shelter an Inherited Home
Beneficiary’s Rights to Trust Copy and Accountings
Under California law, when a decedent dies and their living trust become irrevocable, the trustee is required by Probate Code Section 16061.7 to give any beneficiary notice of that fact and advise that the beneficiary has a right to receive a copy of the trust and periodic accountings and that the beneficiary has the right to contest the trust within 120 days after receipt of such notice. Having received no such notice, the beneficiary's right to contest the trust is four years unless there are … [Read more...] about Beneficiary’s Rights to Trust Copy and Accountings
Rights of a Surviving Spouse
What are the legal rights of a surviving spouse to the deceased spouse's assets where the decedent spouse leaves the bulk of his/her estate to a child from a prior marriage? California is a community property state. Many people are confused about what constitutes community property. Basically, community property is everything a married couple acquires as a result of their labors commencing with the date of marriage. Community property does not include many things, such as separate property … [Read more...] about Rights of a Surviving Spouse
Probate of Testamentary Trust
What state laws apply to a decedent's Will? Well, it depends. First, many states have laws which require the filing, recording or lodging of a Will after the decedent's death. On that issue, the law of the state where the decedent was residing applies. But where do you bring the probate action? Real property must be probated in the courts of the state where the real property is located. For instance, if a Colorado resident dies owning real and personal property, a probate proceeding is … [Read more...] about Probate of Testamentary Trust
Decedent’s Credit Card Debt
I was recently asked to address the question of whether or not a surviving spouse is liable for a deceased spouse's credit card debt. Assuming this is a small estate and there is no probate estate or a trust holding assets, the following three questions need to be answered: First, are you contractually liable for any of the credit card debts? If you and your spouse applied for the credit cards using your joint credit (applied for the card jointly), then both of you are liable for the debt. If … [Read more...] about Decedent’s Credit Card Debt
Funding a trust
I am frequently asked what assets should not be funded into a Trust. The first asset that I list is retirement accounts. First, let's distinguish between the owner of a retirement account such as an IRA or 401k and its pay on death beneficiary. For example, if you were to change the ownership of an IRA to the name of the Trustees in their capacity as Trustees of the Trust, the IRS would consider this retirement account to be "terminated" and would tax the entire contents of the IRA in the year … [Read more...] about Funding a trust
Conservatorship Versus Power of Attorney
Generally, a durable power of attorney for property management is recognized as a good alternative to a conservatorship and keeps all of the related matters out of the court process. However, sometimes a power of attorney doesn't work for a variety of reasons. In those circumstances, a conservatorship may be appropriate to replace or act in conjunction with the power of attorney. For instance, if the person holding a durable power of attorney for property management is found to be … [Read more...] about Conservatorship Versus Power of Attorney
Separate Property and Trusts Versus Prenuptial Agreements
I am frequently asked if creating a living trust prior to marriage will protect the assets, specifically a home, in the event of a divorce. The answer is, probably not. The question is much more of a family law question than an estate planning question. First, transferring the home into a trust will not protect it in the event of a divorce. Having married without the benefit of a prenuptial agreement to the contrary, each of the spouses’ incomes will become community property from and after the … [Read more...] about Separate Property and Trusts Versus Prenuptial Agreements
