These days, it seems you can find people, even those you haven’t seen in years, in a matter of moments. A quick internet search can find that long-lost friend or second cousin, yielding social media accounts, emails, phone numbers and even physical addresses. It may feel as if it is impossible to escape the sticky tendrils of the aptly-named “world-wide web.” Even in death, digitized Social Security death records, ancestry sites, and websites like findagrave.com mark a person’s existence and passing.
Most people, when creating or updating a trust, don’t anticipate the possibility that one of their beneficiaries will simply disappear without a trace. Yet this very outcome happens with disturbing frequency. Online trails may go cold, and there may be no conclusive evidence that a beneficiary has died. What happens to a trust when a beneficiary is living off the grid, or perhaps not living at all?
It may seem impossible that someone who is the beneficiary of a trust would walk away from thousands or hundreds of thousands of dollars,… Read More
Families are constantly changing—sometimes through joyful events like marriages, births, and adoptions, and sometimes less happy ones, like a death or dissolution of a marriage. But too often, people plan for the future as if it will only contain happy events. Even when people do make an estate plan, they tend to ignore the very real possibility of a divorce down the road: either theirs, or their child’s.
Of course, unlike death, divorce isn’t inevitable. Even so, failing to take into account that a divorce could happen could have disastrous outcomes for family wealth. Our firm talks about inheritance and divorce in Ohio, and what you can do to protect your assets for the people you want to inherit them.
As you know, in a divorce, the court divides up the couple’s marital property between them. But unless you have actually gotten divorced, you may not have thought much about what “marital property” is. In essence, “marital property” is any property that either spouse acquires during the marriage, with limited exceptions. In Ohio, one of th… Read More
In December 2019, the president signed into law the Setting Every Community Up for Retirement Enhancement Act, better known as the SECURE Act. As the name suggests, the law is intended to make it easier for American workers to save for their retirement. Let’s examine what the SECURE Act does, and how it might affect your retirement and estate planning.
Prior to the SECURE Act, beneficiaries of inherited IRAs and 401(k)s could “stretch” distributions out over their life expectancy. This had a couple of distinct advantages. Because required minimum distributions (RMDs) were stretched out over a longer time period, perhaps decades, that additional income to the beneficiary was less likely to bump them into a higher tax bracket. In addition, of course, beneficiaries could count on a consistent payment amount year after year.
The SECURE Act has done away with the stretch provision, at least for many people. Under the SECURE Act, if the owner of a 401(k) or IRA dies after January 1, 2020, the beneficia… Read More
Ohio, like other states, has laws that dictate how a the estate of a deceased person (decedent) passes when there is no will. These laws, called “laws of intestate succession,” guide courts, and administrators, as to how the decedent’s assets should be distributed. How does Ohio inheritance work when there is no will?
For the most part, laws of intestate succession try to approximate what most people would intend if they had made a will. If there is a spouse and children, for instance, they will inherit rather than a half-sibling or a first cousin once removed. (If you would prefer your first cousin once removed inherit from you instead of your spouse, you had better get yourself an estate plan—or a divorce lawyer.)
Things get considerably more complicated, though, when there are no close relatives, or when heirs are not of the same degree of relation to the deceased. It’s easy to figure out what to do when the deceased is survived by three adult children, but no spouse: the estate is divided into three equal shares. But what if one of those adult children has died, leaving three children of his own? Or what if the deceased had no surviving spouse, childr… Read More
Most of the time, when someone leaves a will, their assets are distributed according to the terms of the will, after all of the debts of the estate are settled. Occasionally, though, a last will and testament will make bequests that just cannot be fulfilled; there are not enough assets left in the estate. When that happens, who gets shortchanged? Do some heirs receive their entire bequest, while others get little or none of what was "left" to them? Abatement of legacies is the law of who gets what, and how any shortfalls are handled.
Why would abatement of legacies be necessary? Who would leave their heirs assets that they didn't have? Most people don't intend to do that, of course. But the reality is that the value of an estate can go up and down between the time a will is written and the time it becomes necessary to distribute assets. In addition, estate debts can be higher than anticipated, particularly if the last illness of the deceased person incurred significant medical bills.
Put simply, there are often the same number of people at the table, but the size of the pie is smaller. The question then becomes: how is the pie divided? Do some people leave the tabl… Read More
If you inherit a retirement account, particularly a traditional IRA or a Roth IRA, you have some decisions to make. Unlike some inherited property, which you can just set aside until you are ready to deal with it, retirement accounts require timely action on your part, while you may still be dealing with the grief of the loss of the person whose account you inherited.
Fortunately, you don't need to take that action on your own. An estate planning and probate attorney can give you the advice you need in order to make those decisions, and the guidance you require to carry them out. In the meantime, here are some general basics to help you understand your options.
What you can (or must) do with your inherited retirement account depends primarily on three factors: whether the IRA is traditional or Roth; whether or not you were the spouse of the owner, and whether or not the owner had reached the age of 70 1/2 w… Read More
If you're thinking about disinheriting a child, you probably have a good reason for considering this option. And while you aren't obligated to explain your reasons to anyone, letting your estate planning attorney in on your reasoning can help you best achieve whatever your aim is in disinheriting a child.
If, for instance, your child, like so many in this country, has fallen prey to addiction, you may be concerned about them using their inheritance for drugs. Obviously, that could have devastating effects for their health or even their life. In such a case, you may be able to create a trust that will pay directly for their living expenses and even drug or medical treatment. In that way, you could provide for them and promote their health without risk of their wasting their inheritance and without resorting to disinheriting them.
Of course, in some circumstances, there's no estate planning work-around; you genuinely want or need to disinherit your child. If this is the case, the answer is yes, it is possible to do this. It's also possible to attempt to disinherit your child and for them to wind up taking from your estate anyhow. Here's why, and how to make sure your… Read More
Inheriting a family home may be bittersweet: you have the opportunity to carry on family traditions in the family homestead, but the fact that the home is in your hands means that some of the family is no longer there with you. For some people who inherit a home, though, it is more bitter than sweet. The logistical issues of dealing with the property outweigh any happy memories or hopes for future good times there. This is especially true for heirs who left home and moved across the country, only have to deal with their late loved ones' house back in Ohio.
What do you need to do if you inherit your parents' home, or that of another relative? Here are five things to put on your to-do list.
When you live in a home, you take care of it: mow the lawn, clean the house, repair things that are broken. When a house is unoccupied, the home's exterior and yard can quickly become unkempt, and issues like a leak or a burst pipe that would quickly be dealt with in an occupied home can go unnoticed, leading to significant damage. If possible, try to enlist the help of a trusted neighbor or nearby relative to regularly check on t… Read More
You've been appointed executor of the estate of a loved one. Taking your responsibilities seriously, you undertake to locate and identify all of the deceased's assets for an inventory. It is not always easy to locate assets of a late family member. Especially if the deceased was a parent, you may have a pretty good idea of where to start; after all, you took dad to the bank every other week, so you know where his account was. But beyond checking and savings accounts, do you really know what assets he had? And how do you begin to find out?
Locating a loved one's assets is often challenging because we rarely have direct conversations with each other about exactly what we own and where it is. As an adult child, asking an aging parent about these matters can feel (to your parent or to you) as if you're just waiting for them to die so you can collect their wealth. While of course this is not the case, the discomfort of broaching the topic prevents most people from doing so. Then, one day, it's too late.
Here's a helpful guide on how to locate assets of a late family member so they can go through the Read More
Providing financially for children and grandchildren is one of the most satisfying ways to use the assets you've spent a lifetime accumulating. Of course, you have made an estate plan to dispose of your assets after you're gone, but you want to be able to have the joy of giving while you're still alive. Not only does giving during your lifetime allow you to experience the gratitude of your beneficiaries, but making lifetime gifts can be an excellent way to reduce your taxable estate.
As of 2017, you can make a gift of up to $14,000 as an individual (or $28,000 for a married couple) to a child or grandchild each year without incurring gift tax liability on that amount. This gift can be used for their education, travel, even a down-payment on a house when the time comes. But how you give the gift has a significant impact on the benefit you and the beneficiary will get out of it.
You don't want to give a large financial gift directly to a minor chil… Read More