by Admin | Oct 16, 2018 | Uncategorized
No parent wants to think about what would happen to their children if both parents died prematurely and were not able to raise their children. Without the proper plan in place, a court will make that decision for you. Poor planning could lead to relatives arguing in court over who gets your children. Or they could agree on someone other than the people you would have chosen. That is why it is critical that you nominate a guardian now. Here are some tips to help you make that decision.
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Start with a big list. Think beyond the obvious choices. You are not limited to immediate family members. The key is to pick the best person for raising your children. Consider extended family, such as cousins, aunts, and uncles. Friends can make excellent guardians as well.
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What is most important? There are many factors to consider. What matters the most to you? Think about parenting styles, moral values, religious beliefs, educational values, child-rearing philosophy, and physical wellbeing. Do they have other children? What is their relationship to your children? Your preferred guardian should score high in as many categories as possible.
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Do not overly worry about finances. Get life insurance. You should have life insurance, with the proceeds going to your living trust. Do not eliminate someone from consideration solely because they have a small house or apartment. You can help ease the financial burden with what you leave.
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Practical considerations. How would your children fit in with your preferred guardian’s family? Do they live in the same school district? Same city? Do they have young children of their own? If so, would your kids get along with their kids? If you select a married couple, what happens if they divorce?
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Communicate. Talk to the people you are considering. Make sure they would be willing to serve as guardian if necessary. Communicate with your children if they are old enough to express their thoughts. In what would surely be a stressful situation, it is important not to spring big and unexpected surprises on anyone, including the potential guardian as well as your children.
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Plan. Again, it is not easy to think of anyone else raising your children. Start planning ahead now. For more information on how to appoint a guardian for your children, contact me to set up an appointment to discuss your family’s needs.
by Admin | Jul 25, 2018 | Uncategorized
Have you been meaning to finally get a will? Maybe it has been years since you even looked at your documents. Now is a good time to do so. Drum roll please, here are some common mistakes I have seen over the years:
- Not having a written plan. Not having a plan is the most common estate planning mistake. An estate plan is not simply for the wealthy. This is something that will apply to everyone eventually. If you do not direct to whom and how your assets will be distributed, Ohio’s Revised Code will control.
- Procrastinating. I have lost count of the number of people I have talked to that tell me they have been meaning, often for many years, to finally talk to a lawyer and create an estate plan. It is exceptionally easy to put off. It is human nature to not want to think about these issues. But I try to make the process as painless as possible. My clients always tell me they feel a huge sense of relief once the documents are signed and finalized.
- Not reviewing and updating your plan. There are many life changes that can impact your plan, such as births, deaths, marriages, divorces, and new property acquisitions (including out-of-state properties). An estate plan is not something to set and forget about, but rather should be reviewed upon life changes or every 3-5 years.
- Not reviewing beneficiary designations. Assets with beneficiary designations do not pass through the probate process. The will does not control the distribution of assets such as life insurance policies, retirement plans, or jointly owned property and bank accounts. It is important to confirm that your beneficiary designations reflect your wishes and are consistent with the rest of your estate plan.
- Not planning for disability. An unexpected and/or long term disability can cause large expenses and headaches for your family. A durable power of attorney is necessary so that someone can manage your financial affairs if you become mentally incapacitated. A living trust can also help in the event of a disability. But you will want to avoid the necessity of having a guardian appointed through the probate court.
- Failure to communicate your wishes. It is important to let the people named in your estate plan, whether as a guardian for your children, a successor trustee, a health care agent, or beneficiary, know what role you are asking them to play. It is generally not a good idea to surprise someone with an unexpected role to help ensure a smooth transition during a difficult period.
- Leaving money or assets outright to minor children. If you have minor children, it is better to put your assets in a revocable living trust than to give assets directly to a minor. If given directly to a minor, the probate court will oversee the accounts until the minor reaches majority. Further, with a trust, you can control the distribution over years if you prefer. Many of my clients like to stage distributions over time to ensure that their children would not receive a large inheritance before they are capable of responsibly managing the money.
- Failure to fund a living trust. See here for more information on the importance of funding a living trust: https://danmccarthylaw.com/legal-blog/2018/4/17/why-you-must-fund-your-trust
- Not having health care directives. Every estate plan should include a living will and a health care power of attorney. These documents permits your designated agent to make health care decision if you become incapacitated and cannot communicate your own wishes. The living will deals with end of life decisions, while the health care power of attorney deals with other medical decisions other than end of life decisions.
- Attempts to Do It Yourself. There are numerous websites that promise an easy and cheap way for you to draft your own estate planning documents. But just because you can does not mean that you should. I have had clients come in with documents they printed off from the internet. I often find mistakes that render the documents inoperable. For example, I have seen documents that are not executed properly with appropriate and necessary witnesses. Some sites create a false sense of security. If you are going to take the time and effort to create or revise your estate plan, I recommend you hire a professional to help create documents that are valid and accomplish your goals.
by Admin | May 29, 2018 | Uncategorized
Do you need a will but would prefer not to go downtown? McCarthy Law Office now has an office on the West Side for this very reason. We now offer a convenient location at 5600 Harrison Avenue, Suite 200 in addition to our existing location on Court Street.
Whether you have never had a will or just have not looked at your documents in years, now is the perfect opportunity to schedule an appointment to discuss your family’s estate planning needs. I will explain all of your options and will help you craft a plan that is right for you. Let me help take this off of your long-term to-do list.
McCarthy Law Office provides peace of mind for families and small businesses in the following practice areas:
· Estate Planning: wills, trusts, living wills, health care powers of attorney, and durable powers of attorney.
· Personal Injury: if you are injured by the negligence of a third party, I will help you get fair compensation.
· Civil litigation: broad civil litigation experience, including zoning, eminent domain, contract disputes, property disputes, and employment disputes.
Please call 513-815-7006 or email mccarthy@danmccarthylaw.com to schedule an appointment to discuss your legal needs.
by Admin | Apr 17, 2018 | Uncategorized
Revocable living trusts offer many benefits over wills, including asset management and probate avoidance. But even the best designed and drafted trust will fail unless it is properly funded. Once completed, the trust is just an empty vessel until it is filled with your assets.
With a simple will, most of the funding happens through the probate process. You can see some of my previous blog posts about why probate avoidance is preferable for many (in short, probate can be expensive, time consuming, and creates public documents so that anyone can see exactly how much money was in the estate and who received what and when). The funding of a trust, on the other hand, can and should be funded while the trust maker is alive. This assures that assets get in the trust and pass as the trust maker intended. An unfunded or partially funded trust does not avoid probate.
Proper trust funding involves moving assets that are in your name and retitling or reassigning the assets to the trust. Assets generally fall under three main categories:
- Personal property and real property with a title (home, vacation property car, etc.)
- Non-titled property (furniture, artworks, tools, etc.)
- Property that passes by beneficiary designation (life insurance, retirement accounts, etc.)
Most assets should be transferred to the trust as soon after the trust is created as possible. However, an important exception exists for some assets, primarily retirement accounts such as IRAs and 401(k) plans, because of potential tax consequences.
I help my clients through the funding process on a step-by-step and asset-by-asset basis to fully complete the estate plan process so that the final plans will accomplish the goals desired. I can answer any questions you might have about your revcovable trust.
by Admin | Dec 6, 2017 | Uncategorized
Do you need a will? Do you need a trust? What the heck is a trust? Most clients I meet with know they need a will. Most have heard of a trust. But most cannot really define a trust or define why a trust is or is not appropriate for their specific needs. So what is the difference?
A will specifies who your family is, who you want to leave your assets to when you die, how you want to leave those assets, and it identifies an executor who will help take care of the your affairs after death. A will is also where you nominate a potential guardian for minor children.
A will only goes into effect after you die. It has no legal effect during your lifetime. Further, a will does not avoid probate court. Probate is the legal process through which the probate court sees that, when you die, your debts are paid and your assets are distributed according to your will. If you do not have a valid will, your assets are distributed according to Ohio law.
Is probate bad? Not necessarily, but there are drawbacks:
- Probate can be expensive. Legal fees, executor fees, appraisal fees, and other costs must be paid before your assets can be distributed to your heirs.
- Probate takes time. It can often take between nine months to two years to go through the probate process. Nothing can be distributed or sold without court and/or executor approval.
- Probate records are public records. In Hamilton County, all probate records are available on-line here: www.probatect.org/court-records/court-record-search. Probate is a public process and anyone can see what you owned, whom you owed, who will receive your assets, and when they will receive them.
A trust, on the other hand, is more like a private contract. A trust goes into effect immediately upon execution. Like a will, a trust specifies who your family is, who you want to leave your assets to and how you want to distribute your assets. Unlike a will, a living trust can avoid probate at death, control all of your assets, and prevent the court from controlling your assets if you become incapacitated.
A trust avoids probate only to the extent that it is “funded.” When you set up the trust, you transfer your assets from your name to the name of your trust, which you control. When the trust owns your assets, there is nothing for the courts to control when you die or become incapacitated. You retain full control of your assets.
A trust involves three parties:
- Grantor. This is the maker of the trust. It can be an individual or a couple can create a joint trust.
- Trustee. The trustee controls the assets in the trust. The Grantor is typically the initial trustee. For a couple, both spouses are usually co-trustee. Upon the death or incapacity of the initial trustee, a successor trustee takes over and will then follow the written instructions set forth in the trust.
- Beneficiaries. This is simply who receives your assets. If you have minor children, you can stage distributions over several years so that your kids do not receive all of your assets at age 18 or 21.
If you create a living trust, you still need a will. A will serves as a safety net if you forget to put an asset into the trust. If you have minor children, you still have to name the guardian in the will as well.
Just some of the benefits of a living trust include:
- Avoids probate at death.
- Brings all of your assets together in one plan.
- Provides maximum privacy.
- Quicker distribution of assets to beneficiaries.
- Assets remain in trust until you want your beneficiaries to inherit.
- Can be changed or cancelled at any time.
- Peace of mind.
Please call or email me to set up a time to discuss a plan that is right for your family. It is exceptionally easy to put off drafting a will or trust for another time. But I will make it as painless and straight forward as possible.
by Admin | Nov 15, 2017 | Uncategorized
An estate plan is more than just your will. More and more wealth is controlled by beneficiary designation. A will does not override or control assets that contain a beneficiary designation. Such assets may include:
- Real estate controlled by a Transfer on Death Designation Affidavit
- IRAs
- 401ks
- Life insurance
- 529 plans
- Brokerage accounts with beneficiary designation
- Bank accounts with beneficiary designation
How does this apply in the “real world”? If a person takes out a life insurance policy and names only their oldest child as their beneficiary, but then drafts a will that states that multiple children are to take equally, those other children will not receive any of the life insurance proceeds. A will only controls the items that are in the client’s name upon death. All assets with a beneficiary designation transfer to the beneficiary upon death and are not part of the probate estate and are not controlled by the will.
A well-drafted will or trust is an integral part of any estate plan. Assets with beneficiary designations serve an important role as well and are entirely appropriate. However, it is crucial that assets with beneficiary designations are coordinated with the rest of the estate plan to ensure the objectives and wishes are met.
Please contact me to set up a free initial consultation to discuss your estate planning needs.
