Have recent events made you re-consider your estate plan or led you to conclude that you should have one? Have you thought that now might be a good time to tackle this project?  Feel overwhelmed?  Don’t know where to start?  Attorneys make you nervous?

Let me help with a no charge initial consultation.  You can get to know me better and consider whether I might be the right attorney for you.  We can begin to talk through what kind of plan might be the right fit for you.  We can even have our initial consultation over Zoom.  Sound good?  Contact me today at paul@onsagerlawoffice.com or at 608-358-9413.  I look forward to hearing from you.

-Paul

As I have said before, sometimes estate planning can be inspiring:

How do we want to give voice to our values and beliefs in how we provide for our family and causes we may be passionate about after we die?  How do we want to make a difference?

Sometimes estate planning can just be downright tough:

How would the assets of our estate be managed on behalf of our children if we died unexpectedly?  Who would be responsible for managing these assets on behalf of our children?

No one knows your children better than you.  Who better to consider when and under what circumstances your children would receive their inheritance outright to encourage their continued healthy development and to try and ensure that they do not receive their inheritance outright before they are ready to handle it.  Because each child is unique and no one knows your children better than you, there is no one more qualified than you to guide the development of the plan as to how each child should be uniquely addressed to provide for and encourage that child if both of you were to prematurely die.

The two of you are also well positioned to consider the people in your life who not only care about your children, but are qualified to manage your estate on your behalf until the children are old enough or mature enough to receive your estate unconditionally.

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts.  Blog posts are also imperfect tools to address the subtlety and exceptions of the law that may apply in your situation.  As a result, the information in this blog post does not represent legal advice.  If you are in a situation where you need or desire legal advice, we would be happy to help.  Call Paul at 608-358-9413 or complete the Contact Us form to set-up your no-charge initial consultation.]

 

Sometimes estate planning can be inspiring:

How do we want to give voice to our values and beliefs in how we provide for our family and causes we may be passionate about after we die?  How do we want to make a difference?

Sometimes estate planning can just be downright tough:

Who would take care of our children if we died unexpectedly?

Families with minors may wish to consider completing their estate planning, because the question of who would care for your children if you died unexpectedly is likely an emotional question, not just for the two of  you, but for both sides of your family and maybe friends as well.

Under Wisconsin law, parents are empowered in their wills to nominate a guardian for the person and a guardian for the estate for minor children, as well as for adult children who are in need of guardianship due to developmental disability or serious and persistent mental illness.  Separate people can be nominated as guardian of the person and guardian of the estate or a nominated guardian(s) may serve in both roles.  Any nomination by a parent of a guardian for his or her child(ren) in a will is subject both to the rights of a surviving parent as well as to the court’s conclusion as to what is in the best interests of the child(ren).

There are a number of potential advantages that can come from addressing the guardianship of your child(ren) in your will.  You can reduce the risk of someone (potentially a family member) serving as guardian who you are less comfortable with, by either providing explicit direction as to who you would want to serve in this role, and/or by potentially expressing your wishes that a particular party not serve as guardian.  Potential (maybe well intentioned) fighting between the family chapters as to who would serve as guardian of the child(ren) can also possibly be avoided if both families understand your wishes.  If there are concerns that a court might not respect a choice for guardian as in the best interests of the child(ren), your rationale for appointing the party can be explained to the court and an alternate choice can also be identified.  If one party might serve well as guardian of the child (person) but not of the assets, separate guardianships can be created for both the child’s person as well as assets to be managed on behalf of the child.

If both of you were to die unexpectedly, your families and the courts would want to know what you would have desired.  You can let them know with thoughtful guardianship nominations in your respective wills.

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts.  Blog posts are also imperfect tools to address the subtlety and exceptions of the law that may apply in your situation.  As a result, the information in this blog post does not represent legal advice.  If you are in a situation where you need or desire legal advice, we would be happy to help.  Call Paul at 608-358-9413 or complete the Contact Us form to set-up your no-charge initial consultation.]

It is very important for individuals and couples to keep in mind what their wills or trusts can and cannot do, in terms of directing the distribution of their estates after they die.  In particular, it is important for them to keep in mind what assets they own that will not be governed by the provisions of their wills or trusts.

Under Wisconsin law, one or more individuals, including married couples, are authorized to enter into a payable on death (P.O.D.) contractual arrangement with a financial institution for such things as a checking account, savings account, or a certificate of deposit.  Upon the death of the account’s owner(s), the account balance subject to the beneficiary designation passes to the beneficiary specified by the account owner(s) to the financial institution.  This beneficiary designation will control notwithstanding contrary provisions in a will or a trust that the owner may have intended to govern the distribution of this account.  As a part of estate planning, it is important to coordinate the various assets, beneficiary designations, and will or trust documents to ensure that your intent is effectuated.

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts.  Typically blog posts are imperfect tools to address the subtlety and exceptions of the law that may apply in particular situations.  As a result, the information in this blog post does not represent legal advice.  If you are in a situation where you need or desire legal advice, we would be happy to help.  Check out our Contact Us page, and feel free to set-up a no-charge initial consultation.]

It is very important for individuals and couples to keep in mind what their wills or trusts can and cannot do, in terms of directing the distribution of their estates after they die.  In particular, it is important for them to keep in mind what assets they own that will not be governed by the provisions of their wills or trusts.

Under Wisconsin law, property, typically real property (i.e., your home or lake house if you are so lucky), owned  in joint tenancy or as survivorship marital property, will not pass as specified under your will or trust, but will instead pass to the other joint tenant(s) or to your spouse on your death.  If it is important that your will or trust direct some other distribution of the property, then the form of ownership of the property itself will need to be changed.  The right approach for addressing this issue may vary depending upon your circumstances.

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts.  Typically blog posts are imperfect tools to address the subtlety and exceptions of the law that may apply in particular situations.  As a result, the information in this blog post does not represent legal advice.  If you are in a situation where you need or desire legal advice, we would be happy to help.  Check out our Contact Us page, and feel free to set-up a no-charge initial consultation.]

There is all of this talk about trusts and using trusts to create an estate plan.  But what is a trust and how is it created?

Great questions.

At its essence, a trust involves:

• a settlor(s) who have an intention to create a trust and who fund the trust; and
• a trustee who has a fiduciary obligation to manage the assets of the trust for the benefit of current and future beneficiaries of the trust.

Again, a “settlor” is a person who creates a trust or contributes property to a trust.  In order for a trust to be validly created under Wisconsin law, the settlor(s) of the trust must be of sound mind and 18 years of age or older, and the settlor(s) must indicate an intention to create a trust.  In order to be validly created under Wisconsin law a trust must also generally have an ascertainable beneficiary/beneficiaries, the trustee must have duties to perform, and the same person may not be sole trustee and sole beneficiary.

After meeting these requirements a trust is created if:

• a settlor transfers property to another person as trustee;
• an owner of property declares that he or she holds certain property as trustee (provided the owner of property is not sole trustee and sole beneficary); or
• a declaration by any person that they intend to create a trust accompanied by an expectation that property of the person or others will be transferred to the trust.

Again, once a trust is created and funded by the settlor(s), the essence of a trust is a trustee who has a fidicuary obligation to manage the assets of the trust for the benefit of current and future beneficiaries of the trust.  Put another way, a trust involves the management of trust assets by the trustee on behalf of the trust’s beneficiaries.

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts. Typically blog posts are imperfect tools to address the subtlety and exceptions of the law that may apply in particular situations. As a result, the information in this blog post does not represent legal advice. If you are in a situation where you need or desire legal advice, we would be happy to help. Check out our Contact Us page, and feel free to set-up a no-charge initial consultation.]

So, Paul, I got this.  I name my trust as beneficiary of my retirement accounts instead of my will/estate, and, presto, my beneficiaries can stretch out the time period over which they withdraw my retirement account balances.  This may help to avoid higher income taxes and may extend the period over which they earn income in these accounts income tax free.  Right?

Maybe.

Maybe?

Complicated federal law governing retirement accounts requires proceeding with care.

Again, the issue will be whether you have named a “designated beneficiary” under federal law.  You may be considered to have named a “designated beneficiary” even though your trust is the named beneficiary if:

1. the trust is valid under state law (or would be but for the fact that the trust has no assets);
2. the trust is currently irrevocable or will become irrevocable upon your death;
3. trust beneficiaries are “identifiable” from the trust document;
4. required documentation is provided to the plan administrator of your retirement account; and
5. all trust beneficiaries are individuals.

Naming a properly constructed trust as beneficiary of your retirement accounts may permit your beneficiaries to extend the payout period for your retirement accounts (with the associated benefits of an extended payout period) and can permit you far more freedom to direct the utilization and administration of these funds on behalf of your beneficiaries through the trust.  There can also be certain benefits that may be foregone by not naming individual beneficiaries directly, such as potentially losing the spousal rollover option.  However, for many clients a properly constructed trust can be an attractive option as beneficiary of their retirement accounts.

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts.  As a result, the information in this blog post does not represent legal advice.  If you are in a situation where you need or desire legal advice, we would be happy to help.  Check out our Contact Us page, and feel free to set-up a no-charge initial consultation.]

For many of us, our retirement accounts are one of our most important assets for providing for our families.  However, complicated federal law can have unexpected and important implications for your estate planning. Naming your will/estate as the beneficiary of your retirement account (instead of a properly crafted trust or individual beneficiaries) can lead to both higher income taxes as well as fewer years in which assets in your account can grow income tax-free.  Why?

In order to extend the payout period for a retirement account, it is important to meet federal requirements for having named a “designated beneficiary.”  If an individual’s will/estate is named as the beneficiary of the individual’s retirement account, the individual will not be treated as having named a “designated beneficiary.”  If, for example, the individual dies before his or her required beginning date to begin receiving payments from his or her retirement account, and has no “designated beneficiary” (because the individual’s will/estate is the beneficiary of the retirement account), under federal law the retirement account must be paid out over 5-years instead of being paid out over a potentially longer period of the life expectancy of the individual(s) who will receive the funds from the retirement account under the will.  This can potentially reduce the period of time in which assets could continue to grow income tax-free, and potentially move the beneficiary into a higher income tax bracket if the income from the account is being paid out over a relatively short time period.

In Retirement Accounts and Wills vs. Trusts–Part 2, we will look at the implications of naming a trust instead of an individual’s will/estate as the beneficiary of a retirement account.  Stay tuned and Happy Friday!

[Legal advice not only involves an understanding of the law, but the application of the law to a particular set of circumstances or facts.  As a result, the information in this blog post does not represent legal advice.  If you are in a situation where you need legal advice, we would be happy to help.  Check out our Contact Us page, and feel free to set-up a no-charge initial consultation.]

While estate planning costs can vary depending on your goals and the complexity of your estate (money, property, retirement accounts, insurance policies, etc.), we are typically able to offer our clients a fixed fee if they elect to go ahead with an estate plan after the no-charge initial consultation.