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Living Trust Administration on the Death of a Trustor Part 1

The following was written by Attorney Jack E. Stephens, for the professional manual, Rules of Trust Administration in California, regarding the admistration of a Living Trust on the death of a Trustor. This is Part 1 of an ongoing series. 

Estate Planning with Protective Inheritance Trust (PIT) Provisions

       Okay, you've got a child who doesn't understand marriage and is twice-divorced; a child who attracts lawsuits like teenage groupies to a rock star; or, a child who flirts with bankruptcy like a "hot" swimsuit model.

Estate Planning with the Home and Other Real Property

       Okay, put down the remote and give me 5 minutes. We need to talk about Estate Planning with your home and possibly other real property. Would you like the Court to take away your home; would you prefer to die in a lonely nursing facility and not in your home; would you care that a judge, who you don't even know, decides who gets your home at your death; would you want your children to pay extra, and unnecessary, property taxes on your home as part of their inheritance?

Estate Planning with Retirement Plans (IRAs, Roths, 401Ks, etc.)

       This subject led me to write a book in the late 90s called Avoiding Tax Traps In Your IRA which was endorsed by Kiplinger's Retirement Reports. In my research for the book, I discovered a minefield of tax traps which caused individuals to lose substantial money to taxes and penalties.

Stop Your Trust Amendments Before It's Too Late!

       Would you like everyone you have ever mentioned in your Trust to receive a copy of that document? What about ex-friends, remote family members, or even ex-lovers. What about charities, house help, gardeners, etc? But wait a minute Jack, what if I removed them in a subsequent Amendment, you reply? Yeah, that's right, you did, and presumably they won't be an heir in your estate. However, that will not prevent them from taking a gander at your Trust and all of the Amendments at your death. How is that possible if you removed them from the Trust? It is not only possible but it is required by California law. Additionally, your children will have the opportunity to see how you changed the distribution to them over the years through Amendments. The source of this law is California P.C. Section 16061.7. It requires that when any portion of a Trust becomes irrevocable, all beneficiaries and heirs at law, mentioned in the original document and all Amendments, are entitled to a copy. Additionally, they are given 120 days to contest the Trust, if they wish.

The IRA Tax Trap- Designating the Living Trust as the IRA Beneficiary

       Remember when you arranged that IRA with the financial institution and received a "bunch of papers"? Yeah, one of those "bunch of papers" was a Beneficiary Designation form- now remember? Okay, I'm going to ask you 3 questions which can have devastating results depending on your answers.

Contact

Stephens Law Group
12526 High Bluff Dr.
Suite 200
San Diego, CA 92130
Phone: 858-792-0909
Fax: 858-792-0806
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Friday 9am-1pm

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