The San Diego Estate Center

We Can Plan Any Estate In California - The Law Offices of Roy Newman

What You Need, When You Need It Most: The San Diego Memorial Society

Posted on | July 30, 2010 | No Comments

What do you do when a loved one passes away? Who do you call? Are you afraid of being charged excessive fees for funeral services and being taken advantage of by unscrupulous funeral directors? The San Diego Memorial Society is a great choice for those looking for a varied selection of services at a cost that will be difficult to beat. The Society is part of the larger non-profit Funeral Consumers Alliance, a non-profit dedicated to protecting consumers by monitoring funeral industry trends and alerting the public of the potential for abuse. One way for consumers to prevent monopolistic pricing is to band together to create bargaining power – the Memorial Society does just that. They negotiate prices on behalf of their members for a wide array of services, from the straight forward funeral service to alternative in-home memorial services. The best part is that all of the prices are available for review prior to entering the funeral home. I strongly encourage all of the loyal readers of this site to take a moment and check out the Society’s web page.

Category: Estate Planning - Generally
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Nine Things Women Should Know - Estate Planning for Women

Posted on | June 30, 2010 | No Comments

“Women’s life expectancy, combined with their tendency to marry older mates and their lower lifetime earnings means they are far more likely to see their living standards compromised in retirement if proper estate planning isn’t done.” This statement begins a very savvy column in an article titled “Six Estate Planning Questions for Women” by Deborah Jacobs for Forbes Magazine. Generally, women enjoy a longer life expectancy than men, which leaves them vulnerable if they fail to make a plan. In my own practice, it is not uncommon to see many women alone in their final years. Beyond that harsh reality, even with supportive family members and friends, the issue becomes not what you want to do with your estate, but rather who will make decisions for you if you fall ill or are unable to make decisions on your own behalf because of an accident or progressive disease.

If you do not make your choice and formalize it via a medical power of attorney (called an advance health care directive in California – see “What is a Living Will? California’s Advance Health Care Directive”), then the government will make the decision through a long and protracted process called a conservatorship. Conservatorships are not fair to your friends and family because of the prohibitive cost and publicity that is attendant to them, and those same people will be placed in the position of having to guess what you would have wanted should you have made your wishes known. Furthermore, you may rebel at the very notion of a conservatorship and may have to hire a lawyer to defend you during the process.

On the other hand, an advance health care directive will only manage personal care decisions for you –leaving perhaps the most important choices regarding your money to your agent through a financial power of attorney. The issue can occur like this: you are involved in an accident and are hospitalized for a month, unable to make decisions on your behalf. Your mortgage or rent becomes due and you have no one authorized to pay it on your behalf. Now you become entangled in a messy legal scenario in which someone must first petition the government on your behalf – usually through an ex parte temporary conservatorship legal procedure – to pay your bills to avoid foreclosure or eviction. All of that is unneeded if you have someone selected as your financial power of attorney. If drafted the right way, that power of attorney will only become effective should you become incapacitated (called a “springing” power of attorney  - see “What is a Springing Power of Attorney?“). To learn more about who to select and other matters on this topic, the article has a nice section under the section “Whom can you trust?”  My thanks to Professor Beyer for bringing this article to my attention.

Category: Estate Planning - Generally
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How You Can Avoid a Family Feud

Posted on | May 31, 2010 | No Comments

The following quote sums up estate planning quite well:

“Family, money and death are a combustible combination,” said Toronto-based attorney Les Kotzer, who has co-authored a new book — “Where There’s an Inheritance ” — a compilation of 80 real-life vignettes taken from his law practice and radio show callers.

Having no estate plan is a recipe for disaster – your mother or father, wife, or child could end up in costly probate litigation if they do not have an advance health care directive and financial power of attorney in place. The government substitute is called a conservatorship (see What is a Conservatorship?) or guardianship (see What is a Guardianship?) . They are expensive to put in place and expensive to maintain.

But that is just one piece of the puzzle. You also have to make decisions about who should get what – and when they should get it. The Portland Press Herald has four tips  to keep things under control: let your family know what you want to do with your personal effects, name a good family member as trustee or executor, watch for pitfalls in how you allocate money in your estate, and think it through from the beginning.

Category: Estate Planning - Generally
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The Reading of the Will – When, Why and Who Should Be There?

Posted on | April 30, 2010 | No Comments

That’s really a trick question. Although made famous in various movies, television shows, and books, probate and estate planning attorneys no longer (if they ever did) orally read the contents of estate planning documents to family members. They are primarily tasked with finding beneficiaries and heirs of a will and sending them a copy of the document. In fact, wills are an outdated form of estate planning and are generally discouraged from use (See “What Are the Advantages of a Trust?”). This does not make those scenes any less funny – as epitomized by this will reading from the television show 30 Rock.

Thanks to Joel A. Schoenmeyer for bringing this clip to my attention.

Category: Estate Administration
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Trust Mills, Trust Scams, and Trust Lies - “Estate Planners” Unlicensed to Practice Law & Elder Abuse

Posted on | March 31, 2010 | No Comments

I am often approached by people who have been in contact in one form or another with trust mills. Trust mills operate by doing estate planning on a large scale and by threatening elderly (and even middle aged) people with scare tactics if they do not use the estate planner’s often formulaic trusts. Although the use of a trust can in fact save your family money and time (See “What are the Pros of a Living Trust“), it will not allow you to prequalify for Medi-Cal or other public benefits (”What Are the Cons of a Living Trust“).

Nevertheless, that was precisely the alleged claim of two men (who were unlicensed to practice law) in San Jose who convinced some elderly residents that the use of their services would prequalify them for public benefits. The problem is that most of the seniors already qualified, and those did not would have to “spend down” their earnings which would incur heavy penalties.

What are the types of costs that are incurred if an elderly citizen is caught in a trust mill? Often the trust will have inconsistent and ambiguous distributive provisions that must be interpreted by a probate judge before the family can receive anything. The petition to do that is very costly and time consuming – it often takes months before the court order is finally signed and attorney’s fees will total in the thousands of dollars. Never mind the risk that the trust mill will take the private information of seniors and pass it off to others who will try to exploit them for gain. An attorney who breaches attorney-client privilege by releasing such information is subject to serious sanction – which is why estate planning should only be done by licensed members of the bar.

If you know someone who has been ripped off by a trust mill, do not hesitate in getting the plan corrected now. I offer discounts on repairing or restating plans that have been prepared under those circumstances, and I am sure other attorneys would offer the same deal as well.

Category: Probate Litigation
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What Happens After I Die – 2.0

Posted on | February 28, 2010 | No Comments

By now most people are sufficiently entangled with the internet – they have an Ebay account, shop on Amazon, check their bank account online, and are members of a few social networking sites as well. What happens to those accounts after you pass away? A myriad number of startups are promising to tidy up your online presence.

“At least three companies — AssetLock.net, Legacy Locker, and the charmingly named Deathswitch.com — have arisen to keep customers’ passwords, usernames, final messages, and so on in a virtual safe-deposit box. After you’re gone, these companies carry out last wishes, alert friends, give account access to various designated beneficiaries, and generally parse out and pass on your online assets.” Check out more here.

Category: Estate Planning - Generally
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When Offshore Asset Protection Is Really Tax Evasion

Posted on | January 31, 2010 | 1 Comment

It appears that the traditional veil of secrecy surrounding Swiss banking is crumbling. The New York Times is reporting that a former Swiss banker may cooperate with Congressional investigators looking for targets beyond Ernst & Young, KPMG, and Arnold and Porter (who were entangled in 2008) and UBS (2009) (See Also “Eight Signs Your California Tax Shelter or Offshore Asset Protection Trust Is Actually Tax Evasion“). There may be nothing wrong with taking money offshore after it has been taxed – and remember that tax avoidance is perfectly legal while tax evasion is not - but the IRS is investigating “banks that have enabled Americans to evade taxes.”

They may have the help of Rudolf M. Elmer, a whistle blower who has been posting the internal documentation of Swiss bank Julius Baer to wikileaks.org. The banks are accused of taking billions of dollars in accounts and secreting the unreported money in the Caribbean and Switzerland. Elmer’s insider knowledge is sought by investigators as they try to unravel the schemes that could lead to potential criminal and civil penalties. He has so far disclosed his documentation to the IRS, a Senate subcommittee investigating tax evasion and a Manhattan district attorney. The documentation covers trusts, companies and hedge funds, and allegedly includes Rancho Santa Fe resident Jonathan Lampitt of Jupiter Investment Groups. Elmer joins fellow whistle-blowers Bradley Birkenfeld and Heinrich Kieber. As the government plays catch-up, more information will likely become known.

Category: Uncategorized
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Tax Relief and Trusts: How Wal-Mart Avoids Taxation

Posted on | December 31, 2009 | No Comments

The Wall Street Journal has unraveled a scheme used by the giant retailer to avoid the imposition of state taxes in as many as 25 states. The simple graph of how the scheme works can be viewed here. Basically, Wal-Mart pays rent to its real estate trust and that trust then pays dividends to Wal-Mart Property Co (therefore avoiding state taxes) and Wal-Mart Property Co. pays dividends to its parent, which deducts them from its state taxes because they come from a subsidiary. Unlike most tax deductions that involve cash being paid for expenses, this strategy by Wal-Mart actually allows them to keep a majority of the rental payments.

The tax savings to Wal-Mart are likely in the billions of dollars, even though the loophole was long ago closed at the federal level. Several states are now challenging this structure in court, and more are likely to follow. The full article can be viewed here, and a Wal-Mart watchdog has compiled a list of tax avoidance schemes by Wal-Mart with updates on how states are counteracting them.

Category: Business Planning
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8 Steps To Avoid Estate Litigation

Posted on | November 30, 2009 | No Comments

An article by the US News and World Report gives “8 Tips to Avoid Nasty Estate Surprises.”  I agree with most of the points, and add my critique after each tip below:

1. Get a good lawyer. I would add that your lawyer should concentrate exclusively in this area.
2. Pick the right executor and trustees. The right trustee will be solid and will react neutrally to avoid disputes over the estate’s property.
3. Talk about it now. This seems obvious, but most people will not let their intentions be known ahead of time. Unfair surprise is one surefire way to start a contest.
4. Know state laws. In California, as the Tax Professor adds, probate can be avoided entirely through the use of a trust.
5. Make your intentions known early and often. Making repeated modifications to the will or trust will make it harder to invalidate later.
6. Make sure title to your assets is clear. Circumventing the estate distribution by retitling assets later in life is another way to encourage litigation.
7. Consider including a “no contest” clause. Then give the beneficiary an amount that they would rather not sacrifice if they lost the contest.
8. Don’t try to manage your estate from the grave. Although I am not sure that I entirely agree with this one, in theory giving discretion to your beneficiaries may stop them from fighting over items to which they are personally attached. I agree that not every item need be listed in the instrument, but sometimes a person who writes a will or trust can avoid disputes ahead of time by simply making the right decision.

Category: Probate Litigation
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Legal Fights Over Wills - No Contest Clauses Hit the Public Spotlight

Posted on | October 31, 2009 | No Comments

With the death of Michael Jackson and other celebrities, no contest clauses have come to the fore of the public’s attention. No contest clauses are an attempt to keep brothers and sisters, aunts and uncles, and everyone else from suing in probate court every time someone writes an unfair will. There are quite a few benefits to discouraging litigation – as well as some detriment where there is a legitimate cause for concern. In fact, the California law on the subject is complex and will change in 2010. As it stands now, there are multiple statutory exceptions to no-contest clauses that everyone must follow. It is even possible to set aside a no-contest clause if the contest is brought with “reasonable” cause on the grounds of forgery, revocation, or an action to establish the invalidity of any transfer. So at least for now, would-be litigants can take heart that there may be a remedy when a relative makes a move to steal through influence or lack of capacity, as long as there is a solid reason to pursue it.

Category: Estate Planning - Generally
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