Office location:
Law Offices of
Jonathan D. Primuth
790 East Colorado Blvd.
Suite 790
Pasadena, CA 91101
phone: (626) 683-7234
fax: (626) 683-7251
Estate Planning
- Wills
- Living Trusts
- Special Needs Trusts
- Powers of Attorney
- Health Care Directives
- Charitable Trusts
- Life Insurance Trusts
Almost everyone can benefit from a carefully prepared estate plan. When you create an estate plan, you are putting in place a set of personalized legal arrangements covering some of the most important things in your life: your children, your spouse, your health and your property.
A properly drafted estate plan can:
□ Provide a flexible, needs-based financial support system for your children and spouse, while minimizing estate tax liability and ensuring that your property is distributed according to your desires.
□ Avoid the long, costly, open-to-the public process of probating your will and estate property in probate court.
□ Appoint the people you want to be in charge of your property, health, estate administration and minor children.
□ Make your wishes known in an authoritative way so that your loved ones will honor your choices regarding health care, medical treatment, property management and lifestyle if you are no longer able to make decisions in these areas.
□ Provide for the efficient, private transfer of your property to your intended beneficiaries after your death.
Why is a living trust so important?
A living trust can be a great tool for saving time, money, emotional trauma and headaches for those who take over your estate when you die, while at the same time giving you complete control over how your assets will be disposed of. The advantages of a living trust are many:
1) A living trust avoids probate. Unless you plan to give everything to your surviving spouse when you die, without a living trust your estate will have to go through probate court. Probate is expensive, time-consuming and open to the public.
2) A living trust is private. Probate court will expose the details of your estate and financial relationships to the public. A living trust is administered privately by your chosen trustee and his or her attorney working to maintain confidentiality to the greatest extent possible.
3) A living trust is relatively speedy. Probate court can take one year or more to settle a modest sized estate. Your trustee can administer the trust through to completion in as little as a few weeks, depending on the size and complexity of the estate.
4) A living trust costs less than probate court. Statutory fees for probating a one million dollar estate are $23,000 to the executor and $23,000 to the attorney. Fees can go much higher as the estate value increases or if there is substantial real estate. In comparison, fees for administering a living trust after death are typically in the $5,000-$20,000 range, depending on the size of the estate and the complexity of the plan.
5) You can act as your own trustee in full control of your assets. You don’t lose any rights or control over your assets as long as you remain trustee. If you appoint another person (or professional) as trustee to manage your estate, they must act according to the trust instrument, usually under fiduciary principles.
6) A living trust gives you control over disposition of your property at your death. You can instruct the trustee to set up successor trusts to administer your estate for your loved ones and charities, on flexible or fixed terms you decide in advance.
7) A living trust gives you peace of mind about your surviving spouse’s estate arrangements. You can breathe easier knowing that your surviving spouse has an estate plan already in place and does not need to create an estate plan from scratch.
8) A living trust is flexible – it can be changed at any time during your life to reflect your wishes.
9) A living trust does not increase your taxes or require additional tax returns or tax preparation fees. The IRS considers you and your living trust to be the same person, so you report all income and expenses for the trust on your normal tax return without any additional paperwork at tax time.
10) A living trust does not have any annual administration costs while you are trustee. When you die, your trust becomes irrevocable and there are expenses associated with settling your estate.
11) When you are incapacitated, your appointed trustee will manage your property and take care of you according to the instructions in your living trust.
Your will designates how your property will be distributed after your death and who will take care of your minor children (if your spouse is no longer living). If you die without a will, the State of
A living trust smooths and speeds the process of collecting and distributing your property after you die. Because property in your living trust avoids “probate,” your heirs will be spared the long, expensive, open-to-the-public probate process. At the same time, a living trust gives you tremendous flexibility in providing long term, tax-free gifts to your family, beneficiaries and charities. With your assets tucked inside your living trust, your estate will be distributed efficiently without court intervention or supervision. Even if you forget to transfer something into your living trust, your executor can use the probate-by-affidavit procedure to circumvent full probate (with its costs and delays) for combined assets less than $100,000 in value. In this way, the living trust is really the cornerstone of your estate plan.
A living trust can have the following features:
Division into multiple trusts at your death to support your spouse, provide for your kids and support your local charities.
Support for multiple generations --your spouse, children and even grandchildren.
Gifting mechanisms for safely and legally avoiding estate and generation-skipping taxation.
Appointment of successive trustees to manage and distribute trust assets.
Creation of a “special needs trust” to support a handicapped child or loved one without endangering their government entitlement benefits (SSI, SSDI, Medical/Medicaid, Medicare, Calworks, Social Security).
Granting special trustee powers and powers of appointment to your loved ones to adjust trust distributions and beneficiaries in light of changed circumstances and needs.
Your power of attorney for health care (called advance health care directive in How do I make an estate plan? A basic estate plan consists of a will, living trust, advance health care directive and power of attorney for property management, each of which is tied in with the other documents and customized for you. Estate planning is a four step process involving at least two private consultations to help you understand your choices. The five steps are: Information-gathering to assess your goals and needs. Presentation of strategic choices on plan details. Document review and execution (signing, witnessing and notarization). Funding the living trust and notifying key people. All original, executed plan documents will be presented in a professional three ring binder for safe and convenient storage. I meet with you in your home or at my office, informally discuss the process, define your goals and move forward together making these important decisions.
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