Saturday, July 30, 2022

Probate

Probate is a process of improvement that proves a will of a deceased person is valid, so their property can in due course be retitled (US terminology) or transferred to beneficiaries of the will. As with any legal proceeding, there are technical aspects to probate administration:

  • Creditors must be notified and legal notices published.
  • Executors of the will must be guided in how and when to distribute assets and how to take creditors' rights into account.
  • A petition to appoint a personal representative may need to be filed and letters of administration (often referred to as "letters testamentary") issued. A Grant of Letters of Administration can be used as proof that the 'Administrator' is entitled to handle the assets.
  • Homestead property, which follows its own set of unique rules in states like Florida, must be dealt with separately from other assets. In many common law jurisdictions such as Canada, parts of the US, the UK, Australia and India, any jointly-owned property passes automatically to the surviving joint owner separately from any will, unless the equitable title is held as tenants in common.
  • There are time factors involved in filing and objecting to claims against the estate.
  • There may be a lawsuit pending over the decedent's death or there may have been pending suits that are now continuing. There may be separate procedures required in contentious probate cases.
  • Real estate or other property may need to be sold to effect the correct distribution of assets pursuant to the will, or merely to pay debts.
  • Estate taxes, gift taxes or inheritance taxes must be considered if the estate exceeds certain thresholds.
  • Costs of the administration including ordinary taxation such as income tax on interest and property taxation are deducted from assets in the estate before distribution by the executors of the will.
  • Other assets may simply need to be transferred from the deceased to his or her beneficiaries, such as life insurance. Other assets may have pay on death or transfer on death designations, which avoids probate.
  • The rights of beneficiaries must be respected, in terms of providing proper and adequate notice, making timely distribution of estate assets, and otherwise administering the estate properly and efficiently.

Local laws governing the probate process often depend on the value and complexity of the estate. If the value of the estate is relatively small, the probate process may be avoided. In some jurisdictions and/or at a certain threshold, probate must be applied for by the executor/administrator or a probate lawyer filing on their behalf.

A probate lawyer offers services in probate court, and may be retained to open an estate or offer service during the course of probate proceedings on behalf of the administrator or executor of the estate. Probate lawyers may also represent heirs, creditors and other parties who have a legal interest in the outcome of the estate.

In common law jurisdictions, probate ("official proving of a will") is obtained by executors of a will while letters of administration are granted where there are no executors.

Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Wednesday, July 27, 2022

Advance Healthcare Directive : United States


Aggressive medical intervention leaves nearly two million Americans confined to nursing homes, and over 1.4 million Americans remain so medically frail as to survive only through the use of feeding tubes. Of U.S. deaths, about a third occur in health care facilities. As many as 30,000 persons are kept alive in comatose and permanently vegetative states.

Cost burdens to individuals and families are considerable. A national study found that: "In 20% of cases, a family member had to quit work", 31% lost "all or most savings" (even though 96% had insurance), and "20% reported loss of [their] major source of income". Yet, studies indicate that 70-95% of people would rather refuse aggressive medical treatment than have their lives medically prolonged in incompetent or other poor prognosis states.

As more and more Americans experienced the burdens and diminishing benefits of invasive and aggressive medical treatment in poor prognosis states – either directly (themselves) or through a loved one – pressure began to mount to devise ways to avoid the suffering and costs associated with treatments one did not want in personally untenable situations. The first formal response was the living will.

In the United States, all states recognize some form of living wills or the designation of a health care proxy. The term living will is not officially recognized under California law, but an advance health care directive or durable power of attorney may be used for the same purpose as a living will.

In Pennsylvania on November 30, 2006, Governor Edward Rendell signed into law Act 169, that provides a comprehensive statutory framework governing advance health care directives and health care decision-making for incompetent patients. As a result, health care organizations make available a "Combined Living Will & Health Care Power of Attorney Example Form from Pennsylvania Act 169 of 2006."

Several states offer living will "registries" where citizens can file their living will so that they are more easily and readily accessible by doctors and other health care providers. However, in recent years some of these registries, such as the one run by the Washington State Department of Health, have been shuttered by the state government because of low enrollment, lack of funds, or both.

On July 28, 2009, Barack Obama became the first United States President to announce publicly that he had a living will, and to encourage others to do the same. He told an AARP town meeting, "So I actually think it's a good idea to have a living will. I'd encourage everybody to get one. I have one; Michelle has one. And we hope we don't have to use it for a long time, but I think it's something that is sensible." The announcement followed controversy surrounding proposed health care legislation that included language that would permit the payment of doctors under Medicare to counsel patients regarding living wills, sometimes referred to as the "infamous" page 425. Shortly afterwards, bioethicist Jacob Appel issued a call to make living wills mandatory.

Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Sunday, July 24, 2022

Over 100 Legal Document Services at By the People


Rene of By the People in Fairfield CA gives a short overview of their services and the number of legal documents they can help with.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Thursday, July 21, 2022

Living Will


The living will is the oldest form of advance directive. It was first proposed by an Illinois attorney, Luis Kutner, in a speech to the Euthanasia Society of America in 1967 and published in a law journal in 1969. Kutner drew from existing estate law, by which an individual can control property affairs after death (i.e., when no longer available to speak for himself or herself) and devised a way for an individual to express their health care desires when no longer able to express current healthcare wishes. Because this form of "will" was to be used while an individual was still alive (but no longer able to make decisions) it was dubbed the "living will". In the U.S., The Patient Self-Determination Act (PSDA) went into effect in December 1991, and required healthcare providers (primarily hospitals, nursing homes and home health agencies) to give patients information about their rights to make advance directives under state law.

A living will usually provides specific directives about the course of treatment healthcare providers and caregivers are to follow. In some cases a living will may forbid the use of various kinds of burdensome medical treatment. It may also be used to express wishes about the use or foregoing of food and water, if supplied via tubes or other medical devices. The living will is used only if the individual has become unable to give informed consent or refusal due to incapacity. A living will can be very specific or very general. An example of a statement sometimes found in a living will is: "If I suffer an incurable, irreversible illness, disease, or condition and my attending physician determines that my condition is terminal, I direct that life-sustaining measures that would serve only to prolong my dying be withheld or discontinued."

More specific living wills may include information regarding an individual's desire for such services such as analgesia (pain relief), antibiotics, hydration, feeding, and the use of ventilators or cardiopulmonary resuscitation. However, studies have also shown that adults are more likely to complete these documents if they are written in everyday language and less focused on technical treatments.

However, by the late 1980s, public advocacy groups became aware that many people remained unaware of advance directives and even fewer actually completed them. In part, this was seen as a failure of health care providers and medical organizations to promote and support the use of these documents. The public's response was to press for further legislative support. The most recent result was the Patient Self-Determination Act of 1990, which attempted to address this awareness problem by requiring health care institutions to better promote and support the use of advance directives.

Living wills proved to be very popular, and by 2007, 41% of Americans had completed a living will. In response to public needs, state legislatures soon passed laws in support of living wills in virtually every state in the union.

However, as living wills began to be better recognized, key deficits were soon discovered. Most living wills tended to be limited in scope and often failed to fully address presenting problems and needs. Further, many individuals wrote out their wishes in ways that might conflict with quality medical practice. Ultimately, it was determined that a living will alone might be insufficient to address many important health care decisions. This led to the development of what some have called "second generation" advance directives – the "health care proxy appointment" or "medical power of attorney."

Living wills also reflect a moment in time, and may therefore need regular updating to ensure that the correct course of action can be chosen.

Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Monday, July 18, 2022

Trust Law : United States

In the United States, state law governs trusts. Trust law is therefore variable from state to state, though many states have adopted the Uniform Trust Code, and broad similarities exist among states' common law of trust as well. These similarities are summarized in the Restatements of the Law, such as the Restatement of Trusts, Third (2003−08). Additionally, as a practical matter, federal law considerations such as federal taxes administered by the Internal Revenue Service may affect the structure and creation of trusts.

In the United States the tax law allows trusts to be taxed as corporations, partnerships, or not at all depending on the circumstances, although trusts may be used for tax avoidance in certain situations.  For example, the trust-preferred security is a hybrid (debt and equity) security with favorable tax treatment which is treated as regulatory capital on banks' balance sheets. The Dodd-Frank Wall Street Reform and Consumer Protection Act changed this somewhat by not allowing these assets to be a part of (large) banks' regulatory capital.

Estate planning
Living trusts, as opposed to testamentary (will) trusts, may help a trustor avoid probate. Avoiding probate may save costs and maintain privacy and living trusts have become very popular. Probate is potentially costly, and probate records are available to the public while distribution through a trust is private. Both living trusts and wills can also be used to plan for unforeseen circumstances such as incapacity or disability, by giving discretionary powers to the trustee or executor of the will.

Negative aspects of using a living trust as opposed to a will and probate include upfront legal expenses, the expense of trust administration, and a lack of certain safeguards. The cost of the trust may be 1% of the estate per year versus the one-time probate cost of 1 to 4% for probate, which applies whether or not there is a drafted will. Unlike trusts, wills must be signed by two to three witnesses, the number depending on the law of the jurisdiction in which the will is executed. Legal protections that apply to probate but do not automatically apply to trusts include provisions that protect the decedent's assets from mismanagement or embezzlement, such as requirements of bonding, insurance, and itemized accountings of probate assets.

Estate tax effect
Living trusts generally do not shelter assets from the U.S. federal estate tax. Married couples may, however, effectively double the estate tax exemption amount by setting up the trust with a formula clause.

For a living trust, the grantor may retain some level of control to the trust, such by appointment as protector under the trust instrument. Living trusts also, in practical terms, tend to be driven to large extent by tax considerations. If a living trust fails, the property will usually be held for the grantor/settlor on resulting trusts, which in some notable cases, has had high tax consequences.

Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Friday, July 15, 2022

Power of Attorney


A power of attorney is a legal document. A power of attorney allows someone else to act on your behalf or exercise your rights. You should seek the advice of a legal assistance attorney if you have a complex issue.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Tuesday, July 12, 2022

Country Specific Variations


Trusts originated in England, and therefore English trusts law has had a significant influence, particularly among common law legal systems such as the United States and the countries of the Commonwealth.

Trust law in civil law jurisdictions, generally including Continental Europe only exists in a limited number of jurisdictions (e.g. CuraƧao, Liechtenstein and Sint Maarten). The trust may however be recognized as an instrument of foreign law in conflict of laws cases, for example within the Brussels regime (Europe) and the parties to the Hague Trust Convention. Tax avoidance concerns have historically been one of the reasons that European countries with a civil law system have been reluctant to adopt trusts.

Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Saturday, July 9, 2022

Types of Trusts

Trusts go by many different names, depending on the characteristics or the purpose of the trust. Because trusts often have multiple characteristics or purposes, a single trust might accurately be described in several ways. For example, a living trust is often an express trust, which is also a revocable trust, and might include an incentive trust, and so forth.

Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Wednesday, July 6, 2022

What is a Trust and Who Needs it?


Trusts can manage how you leave assets to your family. This video shows how Trusts can create and preserve your legacy.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net

Sunday, July 3, 2022

Purposes of Trusts


Common purposes for trusts include:
  • Employee ownership: Shares in a company may be held by the trustee of an employee trust, often indefinitely, as part of the employee ownership of that company.
  • Employee share ownership: Shares in a company may be held by the trustee of an employee trust as part of an employee share or share option plan.
  • Privacy: Trusts may be created purely for privacy. The terms of a will are public in certain jurisdictions, while the terms of a trust are not.
  • Spendthrift clauses: Trusts may be used to protect beneficiaries (for example, one's children) against their own inability to handle money. These are especially attractive for spendthrifts. Courts may generally recognize spendthrift clauses against trust beneficiaries and their creditors, but not against creditors of a settlor.
  • Wills and estate planning: Trusts frequently appear in wills (indeed, technically, the administration of every deceased's estate is a form of trust). Conventional wills typically leave assets to the deceased's spouse (if any), and then to the children equally. If the children are under 18, or under some other age mentioned in the will (21 and 25 are common), a trust must come into existence until the 'contingency age' is reached. The executor of the will is (usually) the trustee, and the children are the beneficiaries. The trustee will have powers to assist the beneficiaries during their minority.
  • Charities: In some common law jurisdictions all charities must take the form of trusts. In others, corporations may be charities also. In most jurisdictions, charities are tightly regulated for the public benefit (in England, for example, by the Charity Commission).
  • Unit trusts: The trust has proved to be such a flexible concept that it has proved capable of working as an investment vehicle: the unit trust.
  • Pension plans: typically set up as a trust, with the employer as settlor, and the employees and their dependents as beneficiaries.
  • Remuneration trusts: for the benefit of directors and employees or companies or their families or dependents. This form of trust was developed by Paul Baxendale-Walker and has since gained widespread use.
  • Corporate structures: Complex business arrangements, most often in the finance and insurance sectors, sometimes use trusts among various other entities (e.g., corporations) in their structure.
  • Asset protection: Trusts may allow beneficiaries to protect assets from creditors as the trust may be bankruptcy remote. For example, a discretionary trust, of which the settlor may be the protector and a beneficiary, but not the trustee and not the sole beneficiary. In such an arrangement the settlor may be in a position to benefit from the trust assets, without owning them, and therefore in theory protected from creditors. In addition, the trust may attempt to preserve anonymity with a completely unconnected name (e.g., "The Teddy Bear Trust"). These strategies are ethically and legally controversial.
  • Tax planning: The tax consequences of doing anything using a trust are usually different from the tax consequences of achieving the same effect by another route (if, indeed, it would be possible to do so). In many cases, the tax consequences of using the trust are better than the alternative, and trusts are therefore frequently used for legal tax avoidance. For an example see the "nil-band discretionary trust", explained at Inheritance Tax (United Kingdom).
  • Co-ownership: Ownership of property by more than one person is facilitated by a trust. In particular, ownership of a matrimonial home is commonly effected by a trust with both partners as beneficiaries and one, or both, owning the legal title as trustee.
  • Construction law: In Canada and Minnesota monies owed by employers to contractors or by contractors to subcontractors on construction projects must by law be held in trust. In the event of contractor insolvency, this makes it much more likely that subcontractors will be paid for work completed.
  • Legal retainer – Lawyers in certain countries often require that a legal retainer be paid upfront and held in trust until such time as the legal work is performed and billed to the client, this serves as a minimum guarantee of remuneration should the client become insolvent. However, strict legal ethical codes apply to the use of legal retainer trusts.
Read more, here.

1371-C Oliver Road
Fairfield, California 94534

By Phone: 707.428.9871
By Fax: 707.428.9873

By Email: btpfairfield@sbcglobal.net