Mark Twain’s Estate Plan Went South, Despite His Efforts

Mark Twain was right. He passed away one day after the comet’s closest approach to earth. A month later, his last will and testament was admitted by a Connecticut probate court appointing three friends as executor trustees to administer his estate. According to the article “Who will advocate for your estate?” appearing in 83 degrees, his estate plan choices turned out to be a terrible mistake.

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When are You Done with Estate Planning?

A family has set up their estate plan. Two sons are already in the farming business and are thriving. Their daughter will receive the proceeds from a second-to-die life insurance policy and their considerable savings. The amounts are not equal in amount, but they are an equitable inheritance, and it seems like the couple has done its homework.

However, asks an article in The Courier, “The will is done, you’re sitting pretty—but are you?”

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Don’t Forget to Update Your Estate Plan

There are some people who sign their will once in their life and never change it. They may have executed their estate plan late in life, or after they were diagnosed with a serious disease. However, even if your family life and finances are pretty basic, there are still changes in the law that you may need to incorporate into your estate plan.  Some of the people that you named in your will could also have died or moved away.

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Who Will Inherit the Family Home?

Here’s a scenario that happens often. A man receives an inheritance, and he decides to use it to purchase the family home outright. His wife has signed a quitclaim deed to put the property into her husband’s trust. The understanding was that if the husband died before the wife, she would be permitted to stay in the home until her own death. The problem, says The Washington Post in this recent article Make sure you and your spouse are on same page on who will inherit your home,” is that the husband never signed the living trust.

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How Do Trusts Work in Your Estate Plan?

A trust can be a useful tool for passing on assets, allowing them to be held by a responsible trustee for beneficiaries. However, determining which type of trust is best for each family’s situation and setting them up so they work with an estate plan, can be complex. You’ll do better with the help of an estate planning attorney, says The Street in the article “How to Set Up a Trust Fund: What You Need to Know.”

Depending upon the assets, a trust can help avoid estate taxes that might make the transfer financially difficult for those receiving the assets. The amount of control that is available with a trust, is another reason why they are a popular estate planning tool.

First, make sure that you have enough assets to make using a trust productive. There are some tax complexities that arise with the use of trusts. Unless there is a fair amount of money involved, it may not be worth the expense. Once you’ve made that decision, it’s time to consider what type of trust is needed.

Revocable Trusts are trusts that can be changed. If you believe that you will live for a long time, you may want to use a revocable trust, so you can make changes to it, if necessary. Because of its flexibility, you can change beneficiaries, terminate the trust, or leave it as is. You have options. Once you die, the revocable trust becomes irrevocable and distributions and assets shift to the beneficiaries.

A revocable trust avoids probate for the trust, but will be counted as part of your “estate” for estate tax purposes. They are includable in your estate, because you maintain control over them during your lifetime.

They are used to help manage assets as you age, or help you maintain control of assets, if you don’t believe the trustees are not ready to manage the funds.

Irrevocable Trusts cannot be changed once they have been implemented. If estate taxes are a concern, it’s likely you’ll consider this type of trust. The assets are given to the trust, thus removing them from your taxable estate.

Deciding whether to use an irrevocable trust is not always easy. You’ll need to be comfortable with giving up complete control of assets.

These are just two of many different types of trusts. There are trusts set up for distributions to pay college expenses, Special Needs Trusts for disabled individuals, charitable trusts for philanthropic purposes and more. Your estate planning attorney will be able to identify what trusts are most appropriate for your situation.

Here’s how to prepare for your meeting with an estate planning attorney:

List all of your assets. List everything you might want to place in a trust: including accounts, investments and real estate.

List beneficiaries. Include primary and secondary beneficiaries.

Map out the specifics. Who do you want to receive the assets? How much do you want to leave them? You should be as detailed as possible.

Choose a trustee. You’ll need to name someone you trust implicitly, who understands your financial situation and who will be able to stand up to any beneficiaries who might not like how you’ve structured your trust. It can be a professional, if there are no family members or friends who can handle this task.

Don’t forget to fund the trust. This last step is very important. The trust document does no good, if the trusts are not funded. You may do better letting your estate planning attorney handle this task, so that accounts are properly titled with assets and the trusts are properly registered with the IRS.

Creating a trust fund can be a complex task. However, with the help of an experienced estate planning attorney, this strategy can yield a lifetime of benefits for you and your loved ones.

Call us (228) 460-5243 or email us at info@perklawgroup.com to find our how your estate planning attorney can help you.

Legal disclaimer: The information in this article is provided for information purposes only and should not be construed as legal advice. Your should not act or refrain from acting on the basis of any content included in this article or on our website (www.perklawgroup.com) without seeking legal or professional advice.

Reference: The Street (July 22, 2019) “How to Set Up a Trust Fund: What You Need to Know”

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What Are the Biggest Estate Planning Questions I Need to Answer?

If you have a family, you can probably benefit from estate planning, regardless of your asset level. The Montrose Press published an article, “Estate plans can help you answer questions about the future,” that answers some of the big questions:

What will happen to my children? As part of your estate planning, you should name a guardian to take care of your children, if you pass away. You can also name a conservator–sometimes called a “guardian of the estate”–to manage the assets that your minor children inherit.

Will there be a battle over my assets? If you fail to put a solid estate plan in place, your assets could be subject to the time-consuming, expensive and public probate process. During probate, your relatives and creditors can get access to your records. They may even challenge your will. However, with proper planning, you can maintain your privacy.

Who will control my finances and my living situation, if I’m incapacitated? You can sign a durable power of attorney. This permits you to name someone to manage your financial affairs, if you’re incapacitated. A medical power of attorney lets the person you choose handle health care decisions for you, if you’re not able to do so yourself.

Will my family feel cheated if I leave significant assets to charities? As part of your estate plan, you have options. You could establish a charitable lead trust. This will provide financial support to your chosen charities for a set period. The remaining assets will then go to your family members. On the other hand, a charitable remainder trust will provide a stream of income for family members for the term of the trust. The remaining assets will then be transferred to one or more charitable organizations.

Careful estate planning with the help of an experienced estate planning attorney can answer many of the questions that may concern you.

Once you have your plans in place, you can face the future with greater clarity, peace of mind and confidence.

Call us (228) 460-5243 or email us at info@perklawgroup.com to find our how your estate planning attorney can help you.

Legal disclaimer: The information in this article is provided for information purposes only and should not be construed as legal advice. Your should not act or refrain from acting on the basis of any content included in this article or on our website (www.perklawgroup.com) without seeking legal or professional advice.

Reference: Montrose Press (July 7, 2019) “Estate plans can help you answer questions about the future”

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What’s the Latest with Tom Petty’s Estate?
DEL MAR, CALIFORNIA - SEPTEMBER 17: Tom Petty performs in concert on the third day of KAABOO Del Mar on September 17, 2017 in Del Mar, California. (Photo by Gary Miller/Getty Images)

What’s the Latest with Tom Petty’s Estate?

The late Tom Petty’s wife, Dana Petty, has asked a Los Angeles judge for permission to fund the LLC Tom Petty Legacy with the singer’s assets. However, his two daughters object.

Billboard reports in a recent article, “Tom Petty’s Widow Files New Appeals Against Daughters in Escalating Battle Over Late Rocker’s Trust” that Dana asked the court to deny a previous petition filed by daughter Adria demanding that Dana immediately fund Petty Unlimited. This is an LLC created to receive assets (a.k.a. “artistic property”) from Petty’s trust. Instead, Dana wants to fund and execute an operating agreement for Tom Petty Legacy, a separate LLC that she created by herself.

Adria’s petition accused Dana of withholding Petty’s assets from Petty Unlimited to keep her and sister Annakim from “participat[ing] equally” in the management of those assets, as directed in the trust. Adria also said that under the terms of the trust, Dana was required to fund Petty Unlimited within six months of Petty’s death. However, she failed to meet that deadline.

Dana claims that she’s the “sole successor trustee” of Petty’s trust and she’s “exclusively authorized” to form any entity of her choosing to be the beneficiary of her husband’s assets—provided all three women are given equal participation in its management. She claims that the trust doesn’t specify Petty Unlimited as the only entity that can receive the assets. As such, the LLC has no legal rights to them.

Dana claims there’s been “foul behavior” on Adria’s part, stating that the 44-year-old has “caused enormous damage to many of Tom’s professional relationships” via a series of letters (allegedly sent by Adria’s lawyer Alex Weingarten) that “threaten[ed] everyone whom Tom worked with for decades: his record labels, his music lawyer David Altschul…even Tom’s longtime accountant.” Dana says the threats led the attorney, who was then representing her, to resign. She also claims Adria has been “abusive” and “slander[ous]” towards several others, including his longtime business manager Bernie Gudvi, his estate planning attorney Burton Mitchell and members of his band the Heartbreakers.

Dana accused the daughters of interfering in and, in some cases, delaying the release of several posthumous releases of Petty’s music. She says that as trustee of Petty’s trust, she is sole owner of Petty Unlimited, and that Adria and Annakim (and by extension their lawyers) have been “masquerading” as its rightful representatives. The petition notes that Dana has since signed documents to remove Adria and Annakim as managers of the LLC and “fired” a law firm as its representative.

The petition acknowledged that equal participation in the management of Petty’s assets between the three is required under the terms of the trust, but that Dana has sole power to decide on a governing structure for the entity that’s eventually funded with those assets. Now that negotiations with Adria and Annakim have broken down, Dana is trying to assert her “broad discretion” in deciding that structure without their input.

In response to Dana’s claims, Adria and Annakim’s lawyer Alex Weingarten told Billboard, “Dana and her lawyer are basing their case on smoke and mirrors. Every claim they make is demonstrably false. Adria and Annakim are laser focused on one thing—honoring and protecting their father’s legacy and enforcing the terms of his trust, as written.”

Petty died of an accidental drug overdose in October 2017, at the age of 66.

Reference: Billboard (May 30, 2019) “Tom Petty’s Widow Files New Appeals Against Daughters in Escalating Battle Over Late Rocker’s Trust”

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What Should I Keep in Mind in Estate Planning as a Single Parent?

Every estate planning conversation eventually comes to center upon the children, regardless of whether they’re still young or adults.

Talk to a qualified estate planning attorney and let him or her know your overall perspective about your children, and what you see as their capabilities and limitations. This information can frequently determine whether you restrict their access to funds and how long those limitations should be in place, in the event you’re no longer around.

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