Elements of an Up-To-Date Plan

Calendar Planner | Estate Lawyer | Myatt & Bell

We recently sent this letter to many of our past clients because there have been many changes in the estate planning world over the last few years.

Today, MYATT & BELL, P.C. is growing rapidly because the estate plans we did years ago have served families well through incapacity and death.  Families are seeing the value of a M&B estate plan and successive generations are coming to us for their will/trust. But, we also represent clients that maintained outdated plans or inadequate plans from other law firms.  From this, we have learned that many of the hurt feelings, frustrations, delays, and increased estate administration costs could have been avoided by up-to-date planning. Therefore, we send this letter with a particular passion, even a sense of urgency. Below are some steps you can take to make things easier for your family when you become incapacitated or pass away some day.

1. Basic Estate Tax Planning.

The Oregon Estate Tax applies to Oregon gross estates exceeding $1,000,000.  Basic estate tax planning provides for the creation of a Family Trust upon the death of the first spouse.  The objective is that the Family Trust assets should not be included in the surviving spouse’s estate upon the death of the surviving spouse.  In calculating your gross estate, remember that life insurance, retirement accounts (eg. 401k & IRA), and annuities are included.  For wills/trusts drafted prior to 2002, or if your assets have increased since your plan was signed, we recommend a review of your estate plan. Updating your will/trust could save your family precious time and thousands of dollars.

2. Advanced Estate Tax Planning.

Additional estate tax strategies using assets you already own can further reduce or eliminate estate taxes.  Estates with rental, commercial, or vacation real estate, whole life insurance policies, or high basis stock are candidates for additional opportunities to reduce or eliminate estate taxes.  In addition, the present estate and gift tax laws provide great opportunities to reduce your gross estate by gifts.  There are many ways to gift to your beneficiaries during your lives while maintaining rights to control the asset, receive income from it, and manage it even after the asset has been gifted. Nonetheless, once we give assets away we don’t get them back.  This is one reason clients often wait until advanced ages, a terminal diagnosis or life threatening event to make gifts.  At such stages in life, however, it is often too late to effectuate the gift.  In representing our clients and Successor Trustees through advanced planning, we have utilized various strategies to eliminate not only the Estate Tax liability upon death of the surviving spouse, but also to eliminate the necessity of filing the estate tax return.  In short, our gifting strategies can be used to save the estate time and money.

3. Beneficiary Divorce Protection.

Unfortunately, divorce is commonplace.  If an inheritance is given to your beneficiary outright and he/she gets divorced, then the inheritance is generally split with the ex-spouse.  Include our divorce protection trust in your plan to protect your child’s inheritance.

4. Funding of your Living Trust.

Funding the Trust is the process of transferring title of assets to the name of your Living Trust.  This task is important in order to avoid probate and take full advantage of the benefits of your estate plan. The estate tax planning, incapacity planning, gifting, and privacy benefits of your estate plan are all contingent on your assets being appropriately titled in the name of your trust. If you are interested in learning whether your trust is properly funded, then please give us a call.

5. Incapacity Planning.

We are planning for incapacity now on the same level as death.  At some point when we age the majority of us need assistance with finances and paying bills.  We’re not ‘incompetent’; we just need to delegate certain tasks. The Successor Trustee named in your trust should be the best person for that job.  However, your Successor Trustee’s authority is only triggered upon your death or incapacity.  While death is easier to define, incapacity can be more problematic.  We recommend updating your trust to add our Incapacity Panel in order to provide a detailed and private definition of incapacity.  In assisting our clients through these stages of life the Incapacity Panel is both cost efficient and a respectful, honoring way to empower our appointed Successor Trustee.

As you age, it is also important to maintain a relationship with M&B so that we may best represent your desires if you are unable.  It also makes administration much easier for your beneficiaries. Maintaining an up to date relationship with us enables us to respond quickly during emergency health and mental situations, as well as death.  Our goal is to eliminate the common questions that arise during these times that often cause hurt feelings amongst family members.

6. Family Care Plans.

A mother and father, whether it’s a second marriage or otherwise, are the center of the family.  When this center requires long term care and increased assistance, communication and coordination between our children is essential.  Empowering one child to care for us without notice and without preparation could alienate that child from siblings, create tension, raise unanswered questions, and create an inherent conflict of interest. Navigating this season of life, and the complicated emotions associated with it, can be one of the hardest things a family has to go through.  To help smooth the way, M&B has created the Family Care Plan.  This is a contract created between you and your family before you need a caregiver.   By drafting the agreement early, and having the tough discussions up front, we alleviate significant tension and stress down the road.  The Family Care Plan encourages an open, united, family environment where no one is seen as a burden.  Some of the issues our Family Care Plan can address are: (1) naming the family member who will take primary responsibility for caring for you; (2) when and how that family member can be compensated; (3) whether accountings or other information is shared with siblings; (4) preferences regarding in home care and assisted living; and (5) which tasks and activities are most important to you; and much more.

Our experiences in probate, trust administration, and elder law make us all the more passionate about planning.  Lifetime succession, incapacity, and death provide opportunity for our planning to shine.

Most of our planning services are by flat fee so there are no surprises. Each estate presents unique questions to address.  Please do not delay in contacting us at 503-641-6262.

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