Common Estate Planning Blunders Not to Make

When it comes to checking tasks off of your financial to-do list, estate planning is probably the last item you get to, and some people don't get to it at all.

It's really not your fault. After all, many people think it’s morbid to think about preparing for death, and others often don't know where to start, so they simply don't get started.

Case in point: According to the legal services site "Rocket Lawyer," 64% of Americans don't have a basic will. That is really amazing when you think about it.

Estate Planning Opportunities for Families with Special Needs Individuals

Unfortunately, too many families overlook the importance of carefully crafting legal and financial safeguards to protect their special needs children as they grow into adulthood. Many times, families have simply entered into a “pact” with one or more of the siblings of the special needs child whereby those children have “promised” their parents that they will take care of their special needs sibling.

There Are Challenges for Estate Planning Involving Special Needs Children

April Is Autism Awareness Month

On April 2, 2015, President Barack Obama issued a White House proclamation recognizing World Autism Awareness Day, declaring that “… everyone deserves a fair shot at opportunity” and celebrating the work of “… advocates, professionals, family members and all who work to build brighter tomorrows alongside those with autism.”

We Have Come a Long Way

Tax Filing Requirements for 2014 Gifts of Real Property

On December 31, 2013, new law went into effect in Michigan allowing parents to gift their real estate to children during the parents' lifetimes without uncapping the taxable value of the property. As a result, several families took advantage of the new law, and parents actually transferred ownership of their homes to their children. However, preparing, signing and recording a deed transferring the ownership is not all that is required with respect to a transfer of ownership of the property.

Taxable Gifts Are Required to be Reported

Elements of a Worry-Free Estate Plan

Individuals sometime assume estate plans only deal with future concerns like planning for retirement, providing an inheritance for loved ones, specifying long-term care provisions, avoiding estate taxes and appointing guardians for minor children … all the "someday" or "what if" stuff.

While the statements above are true, your estate plan also eliminates (or at the very least reduces) issues that are usually present now – namely, stress and worry.

Planning to Plan Is Not a Plan

I recently represented a client who was appointed as successor trustee of his father’s trust. The father, just prior to his death, held a “family meeting” to announce his intentions to change certain distribution of asset provisions in the trust that would apply after his death. The family meeting was held, the changes were announced but nothing was done to actually amend the father’s trust.

Upon the father’s death, my client’s brother, whose share was decreased by the father in the family meeting, sued my client to obtain his original share of the trust assets.

Succession Planning with Life Insurance for the Family Business, Cottage or Farm

In my experience assisting families with succession planning for legacy assets such as their family business, cottage or farm, the biggest challenge I’ve found is making sure there is enough money to pay for the immediate obligations after the current owner’s death. These obligations can be in the form of taxes, possible interruptions to business operations, and revenue and debt service. The obligations also may extend to longer-term capital needs such as paying the bills for these assets. 

Planning with Life Insurance

People view life insurance as a contingency plan if something bad happens in life. That view, however, is not the whole picture when it comes to considering life insurance as a planning tool. Life insurance can be a solution to several challenges in estate, business and cottage planning situations. As such, it is not only a contingency plan, but it can be a primary tool to serve a specific purpose in a person's overall succession plan.

Dan Penning on WTCM News Talk 580 AM with Dennis Prout and Shea Petaja – Digital Assets

Periodically Dan Penning will appear in the local media to discuss various matters relating to Cottage Law, Estate Planning, Business Succession Planning and Asset Protection.

Cottage Planning - It's About the Memories

Families Preserve Their Best Memories of the Family Cottage Through Succession Planning

Spring triggers the annual migration of cottage/cabin owners back to their summer homes after the long, cold winter – or, for those more fortunate, spending time at warm climate retreats. Spring also brings the excitement and anticipation for a new season of warm, muggy nights, fishing, watersports, campfires, and the constant coming and going of family members and guests at the family cottage.