Category Archives: Estate Planning

A trust is a legal arrangement in which a trustee holds and manages trust assets on behalf of one or more beneficiaries. A trust can be used for a variety of purposes, such as protecting assets from creditors or lawsuits, minimizing taxes, and providing for loved ones who are unable to manage their own affairs.

Here are some situations where a trust may be needed:

1. If you have significant assets a trust can help protect those assets from creditors and lawsuits
   and can also be used to minimize taxes on your estate.
2. If you have minor children: a trust can be used to provide for your children in the event of your
   death and to name a guardian to care for them if necessary.
3. If you have beneficiaries with special needs: A trust can be used to provide for the beneficiaries
   who are unable to manage their own affairs.
4. If you want to provide for a loved one in a specific way: a trust can be used to specify how and
   when assets will be distributed to beneficiaries, giving you more control over how your assets
   are used.
5. If you want to keep your assets private: a trust can help keep your assets out of probate, which
   is a court-supervised process that can make your assets and the distribution of those assets
   public.

It’s important to consult with an attorney who specializes in estate planning to determine if a trust is
the right solution for your situation.

A will is a legal document that outlines how a person’s assets will be distributed after death. There are several reasons why it is important to have a will:

1. It ensures that your assets will be distributed according to your wishes rather than being
   determined according to state law.
2. It can help prevent disputes among your loved ones over the distribution of your assets.
3. It can be used to provide for children or other family members who are unable to care for
   themselves.
4. It can be used to name a guardian for a minor child and ensure they will be cared for by
   someone you trust.
5. It can be used to name an executor who will be responsible for managing and distributing your
   assets according to your will
6. It can help minimize estate taxes by allowing you to plan for the distribution of your assets in a
   tax-efficient manner.
7. It is important to note that without a will, the state will decide how your assets will be
   distributed, which may not align with your wishes or what is best for your family. Additionally, if
   you have minor children a will is imperative to appoint a guardian for them.

Advising clients to use a trust as an estate planning tool is ordinary in my practice. I also urge my clients that just having a trust is ineffective unless it is properly funded. Just signing the trust is not enough. In order for the trust to be effective the Trustee must hold title to the assets in the trust. When clients do not retitle the assets into the name of the trust it really defeats one of the purposes of having a trust.

One main purpose of having a trust is to avoid probate and all the expenses and costs associated with probate. I advise clients to fund their trust as soon as it is created, and I usually assist them with transferring their real property. Many clients are able to transfer their checking and savings account, their wealth management accounts and cars without assistance from me. Don’t forget to properly fund your trust!

You don’t need a trust just for the tax benefits. There are other reasons, such a probate avoidance/privacy and protecting young beneficiaries. Probate is a formal process where a decedent’s property is administered and distributed. Probate is public and there is no privacy. Additionally, there are unneeded expenses. While avoiding probate is important, asset protection is more important. In probate, assets could pass to young individuals who may be over 18, but not able to handle assets and the responsibilities of an inheritance.

A trust can be drafted to protect the individual many years beyond 18 years of age, and still allow the beneficiary to receive distributions for health, maintenance, and education, but still protect the assets held in the trust. There are so many more reasons to use trusts for one’s estate plan, but PRIVACY and PROTECTION are enough to allow one to take note of their importance.

One thing I discovered during the pandemic is many people realized that they were not going to live forever, and they needed an estate plan. COVID 19 did not make planning and executing estate plans easy. Many high-risk workers and essential workers were eager to get their plan in place. Many older people wanted to implement changes in their current estate plans. Accomplishing document signing during the pandemic has proved challenging as Wills require two disinterested adult witnesses and power of attorney for health care and living wills do not require witnesses if the documents are signed before a Notary Public. I became creative in helping my clients sign their estate planning documents while adhering to COVID protocols.

COVID-19 has highlighted the necessity of a well-thought-out estate plan. At the same time, the pandemic has made it more difficult for clients to get these documents that are necessary in place. I have attempted to be creative in solving this current problem while also maintaining “social distance”. Under Ohio law, a Will must be signed in the physical presence of two disinterested adult witnesses. Other estate planning documents, such as Living Wills or Durable Power of Attorney for Health Care do not require witness so long as the documents are signed in front of a notary public. Ohio has not created any new legislation during the pandemic that would change Ohio’s in-person witnessing requirement, even though electronic Will witnessing is under review. In 2019 Ohio allowed for Ohio notarizations to be performed electronically by special authorized online notaries. Some attorneys are witnessing the documents outside or even reviewing the documents via Zoom and then having the clients obtain their own witnesses.

1. Your 18-year-old high school student does need a Health Care Power of Attorney, Living Will, and HIPPA authorization.
2. Your revocable living trust does NOT protect your assets from a nursing home.
3. You must review old life insurance policies.
4. You can keep your assets in your family and not to ex-spouses or creditors.
5. You must review your estate plan often as families change and laws keep on changing. Good estate planning is not a one-and-done deal.

Capacity is a term involving the mental ability to understand one’s actions. Of course, capacity can vary day to day and with new situations. Having diminished capacity can happen for a myriad of reasons, such as an accident, a stroke or even a mental health reason. Sometimes that capacity can be reversed while other times it cannot. It is difficult when a loved one has diminished capacity and wants to make changes to their estate plan as they must made choices regarding their health and financial matters. And each choice requires a certain amount of capacity.

A client must be able to understand a Will or Trust is being made and the client must understand what they have and be able to identify people (family and friends) who would have a claim to their estate and understand their relationship with those people.

To appoint a health care agent, a client must understand the scope of what they are doing in appointing someone to manage their health care. When creating a health care power of attorney, a client just needs to know that they are giving their power to someone else to make health care decisions on their behalf.

The $11.4 million exemption for 2019 will remain in place and may increase slightly from year to year since it may be adjusted for inflation. The TCJA is slated to expire in 2025, so it may be that the exemption goes back.

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I am not a tax attorney. Since the tax reform affects everyone who pays taxes, I thought I should share it. The Republican Tax Cut & Jobs Act (tax reform) the 2018 tax brackets, tax rates and standard deduction amounts have been revised. Many are still focusing on the 2017 taxes for tax filing purposes, but these have not been impacted by the by the tax reform. So, it is on to the 2018 tax brackets, which are below:

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