In a recent case that reached the United States Ninth Circuit Court of Appeals, the Court ruled that assets in Third-Party Spendthrift Trusts (Family Trusts) are not necessarily protected from creditor claims or federal liens against a designated beneficiary. What does this mean for California estate planning? The beneficiary in question, Michael Harris, had two…
As indicated in an article I wrote on May 3, 2016 regarding the withholding of death benefits by insurance companies, there have been some new developments. The insurance industry has had a long standing policy of holding death benefits if they were not contacted by the beneficiary. In other words, the burden was placed on…
If you saw 60 Minutes on CBS Sunday night you had to be astounded by the absolute greed and thievery of life insurance companies. Many of them, mostly all of the large companies, are being sued in a class action for failing to pay death proceeds to deserving beneficiaries. Roughly $7.5 billion have been withheld…
New California Law: Transfer on Death (TOD) Deed ALERT: New California Law Avoiding Living Trust Arrangements Could Cause More Attorney Fees and Costs of Court Than Intended: Wow! I just saw a webinar on the new TOD Deed California Law – a potential calamity. What Is Its Purpose: To pass homes and other specified real property…
Have you ever heard of a situation in which a son or daughter lost their inheritance in a divorce, lawsuit or creditor claim against their spouse? It happens frequently in community property states like California. Typically, on the death of the surviving parent, a son or daughter will receive his/her inheritance and place it in…
Estate Planning with Minor Children: Mick and Mona have 3 minor children ages 12, 10 and 8. Mick and Mona have been procrastinating about a Family Living Trust and Estate Plan. Mick has a 401k plan valued at $300,000 and a life insurance policy with a $500,000 death benefit designating Mona as his primary beneficiary…
Talk about a costly minefield for young adults failing to utilize a Living Trust in California. It happens quite frequently because young adults with minor children, whether couples or singles, do not think about death or incapacity. Right? Right! Their minds are on their jobs, acquaintances, social lives, and of course, their minor children. So…
Attention all of you Trustees of Living Trusts and children beneficiaries of the Trust- This case is a wake-up call. You know how you might want to punish a step-mother or step-father for becoming a life partner or spouse to your widowed mom or dad. Once the natural parent is out of the picture many…
In a recent California case, the California No Contest provisions in a Living Trust were tested. In Balian v. Balian decided in December 2014, the mother, Mary, created the Balian Family Trust designating her children and a Special Needs Trust for her daughters Patricia and Diane as beneficiaries. There was significant animosity between Patricia and…
In light of the recent U.S. Supreme Court case of Clark v. Rameker, creditors will begin to zero in on Inherited IRAs. What is an Inherited IRA? These are IRAs inherited by non-spouse beneficiaries. Typically, spouses rollover IRAs and become the IRA owner if they are designated as the beneficiary. But non-spouse beneficiaries do not…
Take a look at the beneficiary distribution provisions of your Trust. If they conclude with the terminology, “outright and free of Trust,” there is no asset protection for your beneficiaries, usually your children. Let’s look at an example. Joyce and Joe have a Living Trust for the family designating their three children, Jim, Jane, and…