Di Are State Planning

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Planificacion de Patrimonio

Paquete Informativo

Espero que estos materiales resulten de utilidad para usted mientras se prepara para su primerareunión conmigo. Tenga la seguridad de que mu pocas personas comien!an la primera reunióncon cada l"nea del cuestionario completo. La maor"a de la gente tiene un montón de preguntas# a

medida que repasan este material# eso es algo $ueno% la planificación del patrimonio esimportante la maor"a de las personas nunca lo &an &ec&o antes. El o$'etivo de nuestro primer encuentro es discutir todas sus preocupaciones simplemente para iniciar el proceso. (atiempo para llenar los espacios en $lanco a medida que avan!amos. Espero con inter)s la reunióncon usted.

Raquel King, Ttee

Este paquete consiste de cuatro secciones%

► *asic Estate Planning Tools and

Decisions A *rief Introduction to+illsA *rief Introduction to Trusts C&oosing t&e Rig&t Approac& for,ou

► -nderstanding ,our Estate PlanComponents of a Compre&ensive Estate Plan-nderstanding Living Trusts to $e read if ou are creating a living trust/ -nderstanding +ills to $e read onl if ou are not creating a livingtrust/

► A$out Estate Planning at 0amil+ise EstatePlanning T&e 1teps to Esta$lis&ing ,ourEstate Plan A$out 2 0eesA$out 2e

► T&e3uestionnaire

404-859-8632


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www .Diar E s ta te P la nning .c o m© Raqel !ing 20"4

http://www.diarestateplanning.com/http://www.diarestateplanning.com/


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D#$R Plani%icacion &e Patrimonio

Basic Estate Planning Tools and Decisions

A Brief Introduction to Wills

Descri$es &ow t&e wills I draft meet t&e t&ree most $asic estate planning goals of families wit& oung c&ildren.

A Brief Introduction to Trusts

Descri$es &ow living trusts allow an estate to avoid pro$ate and w& t&is ma $e advantageous in our situation.

Choosing the Right Approach for You

* completing t&is wor4s&eet# ou will &ave a $etter idea of w&at pro$ate would cost our &eirs.


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A Brief Introduction to Wills

Compre&ensive wills accomplis& at least t&ree fundamental estate planning o$'ectives for parents of oung c&ildren. A well5constructed will%

► Appoints guardians for minor children.Parents need a will to ensure t&at t&eir c&ildren would $e cared for $ t&e person t&e $elievewould raise t&eir c&ildren in a ric& and nurturing environment. If $ot& parents die wit&out a will#t&e c&ild6s fate is turned over to t&e courts w&ic& &ave neit&er t&e 4nowledge nor t&e interest todo a terrific 'o$ of appointing guardians for orp&ans.

► Protects the estate from unnecessary taxes.A well5drafted will allows parents to pass up to 789 million to t&eir c&ildren wit&out incurring

estate ta:es and will create structures to reduce ta:es on estates wit& assets of more t&an 789million.

► Preseres capital and proides income for the children.+ills for families wit& oung c&ildren will esta$lis& a trust t&at allows a trustee to manage propert left $e&ind# defra t&e costs of raising t&e c&ildren# provide for t&eir education# andultimatel distri$ute t&e assets to t&e c&ildren in a responsi$le wa.

T&e wills I create effectivel address t&ese issues. Ta: savings and asset management for c&ildren can $e accomplis&ed easil t&roug& a will. 2ost importantl# a will is t&e documentou use to appoint a guardian. All in all# wills provide a sensi$le ve&icle for ensuring t&at t&e

costs of estate administration and t&e needs of minor c&ildren are $alanced against t&e initial costof t&e plan.

+ills &ave ot&er advantages and disadvantages. T&eir primar advantage is t&at t&ere is a courtloo4ing over t&e s&oulder of our estate administrator# w&ic& safeguards against e:ecutor malfeasance. +ills also &ave a prescri$ed period for creditor claims. ;nce t&at time is past andt&e court issues its order# t&e claims of creditors are wiped out. 0inall# $ecause spouses do notface onerous pro$ate proceedings# wills effectivel pass propert to t&e surviving spouse at aminimal cost.

T&eir primar disadvantage# t&oug is t&at wills do not prevent a pro$ate proceeding at t&e

deat& of t&e second spouse. +&ile t&e surviving spouse ma avoid pro$ate fees# assets passed to c&ildren will not. An estate over 7899#999 is su$'ect to full5$lown pro$ate proceedings. Pro$ate is time consuming and e:pensive. In most metropolitan areas inCalifornia# it ta4es a relativel uncomplicated estate < to 8= mont&s to move t&roug& t&e pro$ate process. All of t&is dela creates additional e:pense. California pro$ate proceedingstpicall consume $etween >? and @? or more of t&e gross value of t&e pro$ate estate.


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In addition# pro$ate proceedings present a series of &oops t&at t&e e:ecutor must 'ump t&roug&.T&e e:ecutor is required to file various documents wit& t&e court# attend court &earings# and provide t&e court wit& appraisals and accountings. People often esta$lis& a living trust 'ust toma4e sure t&at t&eir e:ecutor is not put t&roug& t&is procedural o$stacle course. Also# if our

c&ildren want or need funds tied up in our estate during t&at time# t&e e:ecutor must ma4e aspecial request of t&e court. +it& a living trust# t&e assets are transferred in a ver s&ort time period usuall wit&in a couple of mont&s/# and t&ere is complete and immediate access to assetsin t&e interim.

;verall# wills can accomplis& specific goals and are effective estate planning tools in certaincircumstances. T&e are essential in nominating guardians to care for our c&ildren upon our deat&. *ecause t&e don6t allow our estate to avoid pro$ate at t&e deat& of t&e second spouse#&owever# t&e are not t&e $est overall solution for man clients.


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A Brief Introduction to Trusts

Compre&ensive living trusts accomplis& at least t&ree fundamental estate planning o$'ectives for

parents of oung c&ildren. A well5constructed living trust will%

► Protect the estate from unnecessary taxes.A living trust allows parents to pass up to 789 million to t&eir c&ildren free of estate ta:es w&ileretaining some control over t&e ultimate distri$ution of t&e assets# and it can create structures toreduce ta:es on estates wit& assets of more t&an 789 million.

► Presere capital and proide income for the children.A living trust for families wit& oung c&ildren will esta$lis& a trust t&at allows a trustee tomanage propert left $e&ind# defra t&e costs of raising t&e c&ildren# provide for t&eir education#and ultimatel distri$ute t&e assets to t&e c&ildren in a responsi$le wa.

► Aoid pro!ate costs.A living trust allows parents to pass t&eir estate directl in trust to t&eir c&ildren# t&us avoidingt&e e:pense and dela of pro$ate.

T&e living trusts I create effectivel address t&ese issues. T&e final critical issue guardians&ipis addressed in a simple will t&at I prepare toget&er wit& t&e trust./ +&ile ta:savings and asset management for c&ildren can $e easil accomplis&ed wit& a will# a will issu$'ect to pro$ate. In most situations# t&e safest and most effective wa to avoid pro$ate inCalifornia is to esta$lis& a living trust. Pro$ate is time consuming and e:pensive. In mostmetropolitan areas of California it ta4es a relativel uncomplicated estate < to 8= mont&s to

move t&roug& t&e pro$ate gauntlet# and t&is dela creates additional e:pense. California pro$ate proceedings tpicall consume >? to @? or more of t&e gross value of t&e pro$ate estate w&ic&includes t&e fair mar4et value of our &ome# not 'ust our equit in it/. A living trust can $esettled in a matter of mont&s# usuall at a fraction of t&e cost.

T&e mec&anics of a living trust during t&e lifetime of t&e people w&o esta$lis& t&e trust t&eBsettlors/ are straig&tforward. Propert is transferred into t&e trust w&ic& t&en &olds t&e propert. 1ince t&e settlors are t&e trustees# t&e settlors are free to invest# spend# or move t&eassets into and out of t&e trust at will. As $eneficiaries# t&e are a$le to use t&e trust principal or income for t&emselves as t&e c&oose. 0inall# during t&eir lifetimes# t&e settlors can alter# addto# or even revo4e t&eir living trust at an time for an reason.

In addition to t&e advantage of avoiding pro$ate# living trusts provide some additional $enefits.*ecause t&ere are no pu$lic filings in pro$ate court# t&e finances of t&e estate are not made pu$licand famil mem$ers are less li4el to $e su$'ect to solicitations. Living trusts also allow atrusted famil mem$er# friend or advisor to manage trust propert if t&e settlors are incapacitated.In addition# if a trust &olds out5of5state propert# t&ere will $e no need to open anot&er pro$ate proceeding in t&e state w&ere t&e propert is located. 0inall# a living trust is usuall moredifficult to contest t&an a will.


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' a m il ( ) is e E s ta te P la nn in g

Living trusts &ave t&ree draw$ac4s# t&oug&% t&e are more e:pensive to esta$lis t&e must $efunded# and t&e propert sc&edules attac&ed to t&e trust must $e 4ept up5to5date. one of t&eseissues s&ould dissuade a person from creating a living trust if esta!lishing a trust other"ise

ma#es sense.

Living trusts do cost more to set up initiall t&an a will# $ut t&e savings ou pass on to our &eirsma4e t&at a good investment. 0unding t&e trust requires o$taining paperwor4 from our financial institution and transferring title of t&ose assets to t&e trust. It is not difficult# $ut it can $e a little time5consuming initiall# depending on our situation. I will teac& ou &ow to do itand will &elp ou if ou run into pro$lems. If ou would li4e more &elp wit& t&e process# I canta4e on t&is 'o$ entirel at m &ourl rate. I recommend# t&oug t&at ou transfer at least a fewof t&e assets ourself# so t&at ou can do it in t&e future.

In comparison# 4eeping t&e trust up5to5date is a snap. I prepare w&at are 4nown as Bfunded

trusts# w&ic& means t&at t&e trust &olds propert during our lifetime. T&e trust includes asc&edule t&at descri$es t&e assets in t&e trust. I will create t&is sc&edule and t&en teac& ou &owto update it# so t&at ou don6t &ave to run to an attorne ever time ou c&ange our trust&oldings. It is a simple matter# and t&e onl real tric4 is ma4ing sure t&at ou review t&e trust periodicall to ma4e sure t&e sc&edule is up5to5date.

All in all# living trusts ma4e a good deal of sense in situations w&ere people &ave su$stantialassets t&at would ot&erwise pass t&roug& pro$ate.


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Choosing the Right Approach for You

Wor#sheet$ What Is the Cost of Pro!ate%

After completing t&is wor4s&eet# ou will &ave a $etter idea of w&at pro$ate would cost our &eirs and w&et&er it6s advantageous to &ave a living trust in our situation. T&e costs of pro$atefees usuall include lawers6 fees# e:ecutor fees# appraisal fees# accountants6 fees# court costsand ot&er incidental costs and fees. Pro$ate fees will not $e a factor if one spouse dies wit&outsignificant amounts of separate propert. T&e also will not affect estates valued under 7899#999.*ot& of t&ose situations qualif for summar pro$ate proceedings w&ic& move ver quic4l andare relativel ine:pensive. (owever# estates wit& a gross alue of oer &'(()((( will $esu$'ected to full5$lown pro$ate proceedings at t&e deat& of t&e remaining spouse. Pro$ate proceedings tpicall cost >? to @? of t&e gross value of t&e pro$ate estate. +&en married people pass on# it is reasona$le to calculate a @? cost to t&eir 'oint estate. T&us# t&e cost of

pro$ate can $e estimated as @? of t&e gross value of our estate passing t&roug& pro$ate.

What Property Passes through

Pro!ate%Real estate valued at fair market value/# cas& and savings# $an4 and $ro4erage accounts#

personal propert#valua$les.

What Does *ot Pass through

Pro!ate%Life insurance and retirement accounts t&ese &ave designated $eneficiaries/.

What Would +ur Pro!ate ,ees Be if -omething .appened to Both of

/s%0or a rough estimate# wor4 t&roug& t&e following calculation.

P r o$ a te Est a te(ome and ;t&er Real Estate fair mar4et value/% 7 Cas& 1avings 7 1toc4s# *onds# *ro4erage Accounts non5retirement/% 7 Personal Propert% 7 ;t&er Falua$le Propert% 7

T;TAL% 7

Pro$ate 0ees G Total : .9@% 7

-hould You 0et a 1iing Trust%T&e incremental cost of &aving me prepare a living trust portfolio of documents w&ic&

includes a living trust# pour5over wills# and ot&er estate planning documents/ instead of a will portfolio of documents w&ic& includes wills and ot&er estate planning documents/ is 78>99 i.e.#7H99/. In ma4ing t&e decision as to w&et&er to get a living trust portfolio# ou s&ouldconsider w&et&er spending t&e additional funds ma4es sense in lig&t of t&e possi$le pro$ate fees


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our estate would pa if somet&ing were to &appen to $ot& of ou.


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/nderstanding Your Estate Plan

Components of a Comprehensie Estate Plan

T&is s&ort section gives ou an overview of t&e portfolio of documents t&at s&ould $e in acompre&ensive estate plan.

/nderstanding 1iing Trusts 2for clients "ho "ill !e creating a liingtrust3

An estate plan $ased on a living trust# w&en properl drafted# creates ta:5savings trusts designedto s&elter some assets from estate ta:es and also contains t&e provisions w&ic& will govern t&edisposition of our estate. T&is section &elps to e:plain t&e concepts underling t&e structure of tpical living trusts t&at I prepare.

/nderstanding Wills 2for clients "ho "ill not !e creating a liingtrust3

An estate plan $ased on wills s&ould address estate ta:es and t&e ultimate disposition of our estate. T&is section &elps to e:plain t&e concepts underling t&e structure of tpical wills t&at I prepare.


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Components of a Comprehensie Estate Plan

2ost parents of oung c&ildren &ave t&ree $asic estate planning goals. +&ile ever situation is

unique# I find t&at most people want an estate plan to%

► Appoint guardians to care for minor c&ildren#► Create a plan to manage assets left $e&ind for c&ildren# and► Preserve wealt& $ reducing or eliminating ta:es and transfer costs.

T&e following tools are used to accomplis& t&ese goals# and some ot&ers $esides.

Wills

+ills are t&e simplest estate planning tools. T&e are e:tremel fle:i$le and provide for t&e

appointment of guardians# creation of ta:5savings trusts# and creation of asset5management trustsfor c&ildren. T&e do not su$stantiall reduce t&e costs of wealt& transfer i.e.# pro$ate/.

1iing

TrustsLiving trusts are legal entities t&at &old propert during a person6s life and provide for adistri$ution plan after deat&. All assets in t&e living trust avoid pro$ate and its associatede:pense and dela. Living trusts are coordinated wit& pour5over wills to appoint guardians andtie5up loose ends.

Po"ers of

AttorneyPowers of attorne allow someone to ma4e decisions and ta4e actions on our $e&alf if ou areincapacitated. T&ere are two 4e documents for estate planning purposes%Dura!le Po"er of Attorney for Property 4anagement allows someone to manage our financial affairs for assets outside of t&e trust if ou $ecome incapacitated.Adance .ealth Care Directie Allows someone to ma4e medical decisions on our $e&alf if ou are una$le to give informed consent. In addition to naming our agent for &ealt& care# t&isdocument instructs p&sicians as to our desires for end5of5life care.

1ife Insurance

TrustLife insurance trusts are used in larger estates over 789 million/ to provide liquidit and offset

ta: lia$ilit t&roug& t&e use of life insurance proceeds. Proceeds from a policies &eld in a properl structured life insurance trust avoid estate ta:es.

+ther

Tools1op&isticated estate planning involves numerous devices designed to reduce or s&ift ta: lia$ilit.If our estate is large# please as4 me a$out ot&er devices.


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If one of ou dies# t&e living trust tpicall splits into two trusts. T&e first trust called t&e1urvivor6s Trust/ consists of t&e survivor6s portion of t&e communit propert# and an portionof t&e remaining trust propert t&at is not put into t&e second trust. T&e 1urvivor6s Trust

continues to $e a living trust. T&e surviving settlor &as t&e rig&t to c&ange t&e terms of t&e1urvivor6s Trust and &as free access to all principal and income.

T&e second trust created at t&e deat& of t&e first settlor is called t&e Credit 1&elter Trust.8

T&eCredit 1&elter Trust is designed to preserve t&e first spouse to die6s a$ilit to pass assets at deat&ta:5free# regardless of w&en t&e second spouse dies. -nder t&e 0ederal ta: law# for deat&soccurring in H988 and H98H# a person is entitled to leave propert wit& a total net wort& of 7@million wit&out incurring estate ta:es. T&is amount will c&ange in t&e future $ut t&e trust isstructured to function over time regardless of t&ese c&anges./ T&is mone ma $e given $ gift#will# or trust. 0or e:ample# if Ko&n gives awa 7@99#999 to &is onl c&ild during &is lifetime andt&en dies leaving t&at c&ild an additional 7J.@ million# t&ere would $e no estate ta:. (owever# if

&e gave t&e gift and t&en died leaving &is c&ild 7@ million# &is estate would owe ta: on t&e7@99#999 a$ove t&e 7@ millionlimit.

If Ko&n gives &is 7@ million to &is wife# 2ar# wit&out a Credit 1&elter Trust# and 2ar dies after H98H# &is ta: credit could $e lost. Let6s assume t&at 2ar also &as assets wit& a net wort& of 7@million. If Ko&n dies and leaves &is 7@ million to 2ar# no ta: would $e due at &is deat&. T&isis true $ot& $ecause of t&e fact t&at &is estate falls wit&in t&e limitation# $ut also $ecause of t&emarital deduction w&ic& allows a spouse to pass virtuall unlimited wealt& to &is or &er spousewit&out $eing ta:ed./ If 2ar died during H988 or H98H# t&en no estate ta: would $e owed on&er or Ko&n6s assets due to provisions in t&e temporar Ta: Relief Act of H989. (owever# if

2ar were to die after H98H wit&out diminis&ing t&e total assets/# s&e would &ave a total estateof 789 million. 1ince 2ar can onl leave 7@ million free of estate ta:es# 2ar6s &eirs would pa ta: on t&e e:cess 7@ million i.e.# t&e mone Ko&n left to &er/. T&is will result in a ta:lia$ilit of 78.@ million. T&e 0ederal estate ta: rate is >@?./ Ko&n6s estate will &ave t&usforfeited its ta: credit and &is &eirs will &ave lost almost two million dollars to t&e federal coffers.

If Ko&n and 2ar set up a living trust# some or all of Ko&n6s 7@ million would $e placed in t&eCredit 1&elter Trust. T&e precise amount would $e fi:ed after Ko&n6s deat& in consultation wit&2ar6s accountant and attorne and t&e election would $e made in t&e 0ederal estate ta: returnsfiled after Ko&n6s deat&./ If 2ar died# &er 7@ million would pass free of estate ta: using &er ta:credit/ and t&e Credit 1&elter Trust assets would also pass wit&out paing ta:es using Ko&ns6

credit/. As a result# t&e entire 789 million would not $e ta:ed and $ot& settlors would preservet&eir ta: credit. *ecause t&e credit covers a ma:imum of 7@ million person# using onl a livingtr ust w ill not w o r 4 to minim i!e ta:es for estates wit& a net value greater t&an 789 million.Estates of more t&an 789 million ma require additional planning.

8If t&e surviving spouse is not a -nited 1tates citi!en# our living trust will contain a 3D;T Trust. If ou

would li4e more information a$out 3D;T Trusts# please contact me.


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During t&e lifetime of t&e surviving spouse# t&e trustee of t&e Credit 1&elter Trust &as fullaut&orit to use t&e assets of t&e trust for t&e $enefit of t&e surviving spouse. 1ince t&e trusteeand t&e $eneficiar are usuall t&e surviving spouse# t&is means t&at t&e surviving spouse &ascontrol over t&e Credit 1&elter Trust assets./ Trust income must $e paid to t&e surviving spouse

and t&e principal of t&e trust ma $e wit&drawn for &ealt education# support and maintenance.Preserving t&e ta: credit is a strong incentive not to spend t&is mone# and it s&ould not $e spenton gifts or items clearl outside t&e surviving spouse6s normal lifestle. (owever# t&ese fundsare availa$le to t&e surviving spouse w&en needed. T&e Credit 1&elter Trust is an irrevoca$letrust and its terms cannot $e altered. 0or e:ample# if t&e Credit 1&elter Trust names certain $eneficiaries w&o will receive distri$utions after t&e deat& of t&e second spouse# t&e list cannot $e c&anged after t&e trust $ecomes irrevoca$le.

$. C&ildren6s Trust

At t&e deat& of t&e second spouse# t&e propert in $ot& t&e 1urvivor6s Trust and t&e Credit

1&elter Trust will $e distri$uted. If t&e propert is to $e distri$uted to t&e couple6s minor c&ildren# t&e funds will $e &eld in a c&ildren6s trust for t&eir $enefit. T&e trust will last until t&ec&ildren reac& t&e ages specified in t&e trust document. -ntil t&at time# t&e funds ma $e usedfor t&e c&ildren6s &ealt education# support and maintenance. T&is trust can provide for suc&t&ings as living e:penses# college e:penses# pament to cover costs to t&e guardians# and so on.,our c&ildren will not get lump sums of mone until t&e ages ou specif. -ltimatel# t&e trust principal can $e distri$uted in one distri$ution or in stages for e:ample# H9? of eac& c&ild6ss&are could $e distri$uted outrig&t w&en &e or s&e reac&es age H># @9? of t&e remainder at ageH=# and t&e final distri$ution at age >H/. Provisions in t&is section can $e e:tremel fle:i$le.

T&e diagram on t&e ne:t page puts in grap&ic form w&at &as $een discussed a$ove and

represents t&e mec&anics of a tpical Living Trust.

H

HI will also prepare a Bpour5over will for $ot& spouses. T&is will accomplis&es two primar o$'ectives% it

appoints guardians for minor c&ildren and it ensures t&at an propert w&ic& is not Bin t&e trust will $etransferred to t&e trust after deat&.


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*i+ing ,rst

Property of Spouse A Property of Spouse B

Deat- o% ./ose $

re&it .-elter,rst 1ol&s/ to 5 o%

./ose $4s/ro/ert(

.r+i+or4s

,rst1ol&s t-e

Remaining $ssets

Deat- o% ./ose

-il&ren4s ,rst

Distri6tions 7#llstrati+e9 20: at age 239 50: at age 289 Remain&er at age 32

T&is is a lot to assimilate# $ut it is useful to understand &ow t&e trust actuallwor4s. I will $e &app to discuss t&is wit& ou in greater detail at an time.


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/nderstanding WillsRead t&is if I am preparing onl willsnot a trustfor ou/

+ills can $e somew&at comple:# $ut wit& a little effort# t&e concepts underling our estate plancan $e readil understood. T&e wills I prepare are designed to accomplis& t&ree $asic financialo$'ectives% 8/ create ta: savings# H/ provide over t&e ultimate distri$ution of assets# and>/ create a propert management plan for oungc&ildren.

8. T er minolo g

To understand testamentar trusts w&ic& are trusts created onl after someone dies/# it isimportant to understand t&e relevant terminolog. A trust is an independent legal entit t&at isesta$lis&ed $ one or more settlors. T&e $asic purpose of a trust is to &old propert and ensure

t&at it is administered as t&e settlors direct. T&e propert t&at t&e trust &olds is called principal #and funds generated $ t&e principal are called income.

T&e trustee administers t&e trust. T&e trustee ma $e a person# a group of people# or acorporation or an com$ination of t&ese/. T&e trust document and various statutes esta$lis& t&e powers and duties of t&e trustee. T&e trustee6s fundamental dut is to act in t&e $est interests of t&e $eneficiaries in managing t&e trust as t&e settlor directs in t&e trust documents.

Beneficiaries receive t&e $enefits of t&e trust. *eneficiaries can $e individuals or corporationsusuall c&arities/# and ma receive trust income or principal or $ot&.

H. ( ow T e st a m e nt a r T r usts+ o r 4s

,our will actuall serves to esta$lis& a series of trusts. T&e first trust is esta$lis&ed at t&e time of t&e first spouse6s deat&.

a. T a : 1 a vin g s

T&is section e:plains &ow wills tpicall wor4# alt&oug& t&ere ma $e differences $ased on our circumstances.

+&en one of ou dies# all of our propert will $e left to t&e surviving spouse. T&e survivingspouse t&en &as nine mont&s to decide w&et&er to esta$lis& a Credit 1&elter Trust

8using some

po r tion of t&e p r op er t in& er ited from t&e deceased spouse. T&e Credit 1&elter Trust will allowt&e propert it contains ultimatel to pass to our c&ildren or ot&er &eirs/ free of estate ta:es t&at

8If t&e surviving spouse is not a -nited 1tates Citi!en# t&e Credit 1&elter Trust does not come

in to pla. Instead our will would provide for t&e creation of a 3D;T Trust. If ou would li4emore information a$out 3D;T Trusts# please contact me.


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would ot&erwise $e owed. Deciding w&et&er or not to esta$lis& t&e trust is a decision for t&esurviving spouse# to $e made wit& t&e &elp of professional advisors# and it will $e $ased on t&ee:isting estate ta: credit and t&e si!e of t&e survivor6s estate.

T&e Credit 1&elter Trust is designed to preserve t&e first spouse to die6s a$ilit to pass assets atdeat& ta:5free# regardless of w&en t&e second spouse dies. -nder t&e 0ederal ta: law# for deat&soccurring in H988 and H98H# a person is entitled to leave propert wit& a total net wort& of 7@million wit&out incurring estate ta:es. T&is amount will c&ange in t&e future $ut t&e trust isstructured to function over time regardless of t&ese c&anges./ T&is mone ma $e given $ gift#will# or trust. 0or e:ample# if Ko&n gives awa 7@99#999 to &is onl c&ild during &is lifetime andt&en dies leaving t&at c&ild an additional 7J.@ million# t&ere would $e no estate ta:. (owever# if &e gave t&e gift and t&en died leaving &is c&ild 7@ million# &is estate would owe ta: on t&e7@99#999 a$ove t&e 7@ millionlimit.

If Ko&n gives &is 7@ million to &is wife# 2ar# wit&out a Credit 1&elter Trust# and 2ar dies after H98H# &is ta: credit could $e lost. Let6s assume t&at 2ar also &as assets wit& a net wort& of 7@million. If Ko&n dies and leaves &is 7@ million to 2ar# no ta: would $e due at &is deat&. T&isis true $ot& $ecause of t&e fact t&at &is estate falls wit&in t&e limitation# $ut also $ecause of t&emarital deduction w&ic& allows a spouse to pass virtuall unlimited wealt& to &is or &er spousewit&out $eing ta:ed./ If 2ar died during H988 or H98H# t&en no estate ta: would $e owed on&er or Ko&n6s assets due to provisions in t&e temporar Ta: Relief Act of H989. (owever# if 2ar were to die after H98H wit&out diminis&ing t&e total assets/# s&e would &ave a total estateof 789 million. 1ince 2ar can onl leave 7@ million free of estate ta:es# 2ar6s &eirs would pa ta: on t&e e:cess 7@ million i.e.# t&e mone Ko&n left to &er/. T&is will result in a ta:lia$ilit of 78.@ million. T&e 0ederal estate ta: rate is >@?./ Ko&n6s estate will &ave t&us

forfeited its ta: credit and &is &eirs will &ave lost almost two million dollars to t&e federal coffers.

If Ko&n and 2ar set up a living trust# some or all of Ko&n6s 7@ million would $e placed in t&eCredit 1&elter Trust. T&e precise amount would $e fi:ed after Ko&n6s deat& in consultation wit&2ar6s accountant and attorne and t&e election would $e made in t&e 0ederal estate ta: returnsfiled after Ko&n6s deat&./ If 2ar died# &er 7@ million would pass free of estate ta: using &er ta:credit/ and t&e Credit 1&elter Trust assets would also pass wit&out paing ta:es using Ko&ns6credit/. As a result# t&e entire 789 million would not $e ta:ed and $ot& settlors would preservet&eir ta: credit. *ecause t&e credit covers a ma:imum of 7@ million person# using onl a livingtrust will not wor4 to minimi!e ta:es for estates wit& a net value greater t&an 789 million.Estates of more t&an 789 million ma require additional planning.

During t&e lifetime of t&e surviving spouse# t&e trustee of t&e Credit 1&elter Trust &as fullaut&orit to use t&e assets of t&e trust for t&e $enefit of t&e surviving spouse. 1ince t&e trusteeand t&e $eneficiar are usuall t&e surviving spouse# t&is means t&at t&e surviving spouse &ascontrol over t&e Credit 1&elter Trust assets./ Trust income must $e paid to t&e surviving spouseand t&e principal of t&e trust ma $e wit&drawn for &ealt education# support and maintenance.Preserving t&e ta: credit is a strong incentive not to spend t&is mone# and it s&ould not $e spenton gifts or items clearl outside t&e surviving spouse6s normal lifestle. (owever# t&ese fundsare availa$le to t&e surviving spouse w&en needed. T&e Credit 1&elter Trust is an irrevoca$le


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trust and its terms cannot $e altered. 0or e:ample# if t&e Credit 1&elter Trust names certain $eneficiaries w&o will receive distri$utions after t&e deat& of t&e second spouse# t&e list cannot $e c&anged after t&e trust $ecomes irrevoca$le.

$. C &ild re n 6 s T r ust

At t&e deat& of t&e second spouse# &is or &er propert after going t&roug& pro$ate/ and t&eCredit 1&elter Trust propert will $e distri$uted. If t&e c&ildren are old enoug& to receive t&edistri$utions directl# t&e assets can simpl $e distri$uted after t&e close of pro$ate. If t&e propert is to $e distri$uted to t&e couple6s minor c&ildren# t&e funds will $e &eld in trust for t&eir $enefit. T&e trust will last until t&e c&ildren reac& t&e ages specified in t&e trust provisions.-ntil t&at time# t&e funds ma $e used for t&e c&ildren6s &ealt education# support andmaintenance. T&is trust can provide for suc& t&ings as living e:penses# college e:penses# pament to cover costs to t&e guardians# and so on. ,our c&ildren will not get lump sums of mone until t&e ages ou specif. -ltimatel# t&e trust principal can $e distri$uted in one

distri$ution or in stages for e:ample# H9? of eac& c&ild6s s&are could $e distri$uted outrig&tw&en &e or s&e reac&es age H># @9? of t&e remainder at age H=# and t&e final distri$ution at age>H/. Provisions in t&is section can $e e:tremel fle:i$le.

>. P r o$ a te .

Tpicall# at t&e deat& of t&e first spouse# t&ere is a summar pro$ate proceeding to pass assetsto t&e surviving spouse. Assets w&ic& name $eneficiaries pass outside of pro$ate for e:ample#life insurance and retirement plans/. Assets w&ic& are in 'oint tenanc also pass outside of pro$ate. -pon t&e deat& of t&e surviving spouse# t&ere would $e a full5$lown pro$ate proceedingfor t&ose assets t&at did not &ave $eneficiar designations. -pon t&e conclusion of t&is

proceeding# t&e assets would $e distri$uted to t&e &eirs eit&er directl to t&em or in trust/.

T&e diagram on t&e ne:t page puts in grap&ic form w&at &as $een discussed a$ove andrepresents t&e mec&anics of a tpical will plan for a couple# including t&e mec&anics of testamentar trusts.


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./ose $4s )ill

Summary

ProbatePossi6le %or some assets

$monts a6o+e5 are a&&e& tot-e .r+i+or4sassets

re&it .-elter ,rst 1ol&s t-e

%irst 5 o% ./ose $4s assets

.r+i+or4s $ssets

./ose 4s )ill

Full Probate'or almost all assets

-il&ren4s ,rst

Distri6tions7#llstrati+e9 20: at age 239 50: at age 289 Remain&er at age 32


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A!out Estate Planning at ,amilyWise$

The Process and ,ees

Creating our estate plan is actuall a relativel painless process. T&is section will let ou 4now w&at to e:pect as ou create our estate plan.

The -te p s to E s t a ! li s h i n g Y o u r E s t a te P la n

-tep '$ Your Preparation 2or 5Yi#es6 .ome"or#73

► -c&edule an appointment wit& me. I will meet wit& ou in our &ome or office at

a mutuall agreea$le time.

► *efore our first appointment# review t&is pac4et carefull.Read t&e enclosed materials.2a4e a tentative decision as to w&et&er ou will $e preparing a living trust.

"e will talk about this further when we meet, but it will help you in your

preparation to have a sense of the overall approach we will be taking.0ill out t&e 3uestionnaire as muc& as oucan. Mat&er and cop necessar documents.

-tep 8$ +ur 4eeting 2this is often the !est part63

During our appointment# we will tal4 generall a$out our goals and an specialcircumstances or concerns t&at ou &ave. I will go over t&e mec&anics of t&e living trust andanswer an lingering questions. I will t&en review our 3uestionnaire and will gat&er someadditional information. T&e meeting tpicall ta4es a$out one5and5a5&alf to two &ours. I&ave found t&at it is $est to &ave someone to watc& our toddlers during t&is meeting so t&atou can full focus on t&e tas4 at &and./ At t&e end of t&e meeting I will as4 ou to sign t&eLegal 1ervices Agreement and t&e Disclosure and to pa one5&alf of t&e $ase fee.

-tep 9$ Document Preparation 2no" it:s my turn to do home"or#;3

I will prepare all t&e appropriate documents depending on w&et&er ou need a Living TrustPortfolio or a +ill Portfolio. In t&e case of a living trust portfolio# t&ese documents willinclude a living trust# pour5over wills# dura$le powers of attorne for propert management#advance &ealt& care directives# and ot&er ancillar documents. In t&e case of a will portfolio#t&ese documents will include t&e wills# dura$le powers of attorne for propert management#advance &ealt& care directives# and ot&er ancillar documents.


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0a m il+i s e E st a te P la nn in gWill Portfolio; +&en I draft our wills# I will also prepare dura$le powers of attorne for propert management# advance &ealt& care directives# and ot&er# ancillar documents. T&e fee

for preparing a +ill Portfolio is 78J99 for a married couple and 78899 for a single person. T&isfee is for stand5alone wills onl# if ou c&oose to do a Living Trust Portfolio# t&e cost of t&e willsis included in t&at fee.

Pro Bono Policy; If ou cannot afford t&e fee for a will# I will prepare a simple will for ou on asliding scale. It is m polic not to turn awa an parent of a minor c&ild $ecause of an ina$ilitto pa.

Payment +ptions; I am more t&an &app to wor4 wit&in our $udget. ,ou ma pa ininstallments t&at are comforta$le for ou and interest free. If ou would li4e to avail ourself of

t&is option# 'ust as4 prior to our first meeting. I c&arge a 7899 cancellation fee for appointmentscancelled wit& less t&an HJ &ours notice.

A ! o ut 4 e

I graduated from *oalt (all 1c&ool of Law at t&e -niversit of California# *er4ele# w&ere Iwon t&e 2oot Court +riting Award and t&e Prosser Award# and served as Article Editor on t&e*er4ele Tec&nolog Law Kournal. I &ave a *.A. in Englis& from t&e -niversit of California#Irvine# w&ere I graduated cum laude, 'unior P&i *eta Oappa. I am also t&e mot&er of two oung

c&ildren. After practicing transactional law in t&e Information Tec&nolog Mroup of CooleModward# LLP# in 1ilicon Falle# I opened m estate planning practice in order to practice lawin a wa t&at would directl $enefit families including m own/.


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0a m il+i s e E st a te P la nn in gC 1 I E * T > / E - T I + * * A I R E

#illing out the$uestionnaire

,ou s&ould fill in all names in t&is questionnaire# including your o"n# as ou want t&osenames to appear in our documents even if t&e person will not $e specificall mentioned/.,ou ma use full legal names or middle initials.

,ou can alwas c&ange t&e decisions ou ma4e now $ amending our documents later. 0or now# ou want to ma4e t&e $est c&oices ou can given our current life situation.

T&is is a generic questionnaire so if questions do not appl# simpl write in NA.

I understand t&at m estate plan will $e $ased on t&e information provided &erein. I furt&er understand t&at m responses to t&e questionnaire are protected $ t&e attorne5client privilege.+it& t&ese understandings# I affirm t&at t&e information provided &erein is full# complete andaccurate to t&e $est of m present 4nowledge.

Dated% 1igned%

Dated% 1igned%


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0amil+ise Estate PlanningC 1 I E * T > / E - T I + * * A I R E

PART I$ ,A4I1Y

Client 8%

Client H%

Address%

Ci

t%

# CA

P&one os. (ome%

Client 8 Cell%

0a:%

Client H Cell%

E5 mail%

Client 8 Email%

Client H Email%

Client 8 Emploer%

Client H Emploer%

P&one o.

P&one o.

C

h

i

l

d

r

e

n

$

ame%

ame%

ame%

*irt&date%

*irt&date%

*irt&date%


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0amil+ise Estate PlanningClient ':s ,amily$

Client 8:s ,amily$

0at&er%

2ot&er%

1i$lings%

If ou are not married# c&ec4 t&is $o:% o


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30/49

PART I@$ 0/ARDIA*-) TR/-TEE-) EEC/T+R- A*D AD@I-+R-

0uardians$+&om do ou want to nominate to care for our minor c&ildren T&is is t&e person wit&w&om our c&ildren would live.

!rimary%

ame%

Address%

Relations&ip%

P&one%

Age%

&econdary%

ame%

Address%

Relations&ip%

P&one%

Tertia

ry%

Age%

ame%

Address%

Relations&ip%

P&one%

Trust

ee$

Age%

+&o s&ould manage t&e assets for our c&ildren as t&e are growingup ,ou ma namet&e same person as $ot& guardian and trustee if ou c&oose to do so.,ou ma also name co5 trustees and ou ma name a corporate trustee./

!rimary%

ame%

Address%

Relations&ip%

P&one%

Age%

&econdary%

ame%

Address%

Relations&ip%

P&one%


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ExecutorPersonal

Representatie$

+&o s&ould &andle t&e pro$ate process I will assume t&at ou &ave c&osen eac& ot&er asour primar c&oices and so ou need onl fill in secondar and tertiar c&oices/. ,ou maname an individual to t&is position.

&econdary%

ame%

Address%

Relations&ip%

P&one%

Tertiary%

ame%

Address%

Relations&ip%

P&one%

Current ,inancial Adisors$

Accountant% ame% P&one%

Compan%

Life Insurance% ame% P&one%

Compan%

Investment Adv. ame% P&one%

Compan%

If ou would li4e t&e names of advisors# please let me 4now. I donot $enefit in an wa from referrals# $ut I li4e to see a team of peoplein place to support m clients.


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PART @$ 0I,T- and

DI-TRIB/TI+*-

0uardian

0ift$

+ould ou li4e to ma4e a gift to t&e guardians or provide t&em wit& a stipend T&is is

mone t&at t&e will use for t&eir own needs# not t&e mone t&at t&e will use to ta4e care of our c&ildren. Ideall# t&e e:penses directl related to raising our c&ild would $e paid for $ t&e trust.

Mift to Muardian%

1tipend for Muardian% Nmont&

,inal

Distri!ution$

If somet&ing &appened to $ot& ou and our c&ildren# w&o s&ould receive our assets

-pecific 0ifts$Do ou want to ma4e gifts of personal propert

Charities$Do ou &ave specific c&arities to w&ic& ou would li4e to contri$ute In ma4ing our list please provide t&e complete name of t&e organi!ation and t&e cit and state w&ere it is &eadquartered./

Pets$+&o s&ould care for our pets People will often c&oose t&e guardian of minor c&ildren if t&eir c&ildren are old enoug& to $e attac&ed to t&e pets./

ame%

Address%

P&one%

,uneral Arrangements$

Client 8% ☐ *urial ☐ Cremation

1pecial Instructions%

Client H% ☐ *urial ☐ Cremation

1pecial Instructions%


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PART @IA$ 4EDICA1 and ,I*A*CIA1

DECI-I+*-

If ou were incapacitated and needed someone to ma4e medical and financial decisions for ou# w&o would t&at person $e I assume ou are eac& ot&er6s first c&oice# so ou need onl

ma4e secondar and tertiar c&oices.

Client ':s Agent for

.ealthcare

ame%Address%

P&one%

*ac4up Agent% ameNAddressNP&one%

Client ':s Agent for ,inance

ame% P&one%

Address%


Client 8:s Agent for .ealthcare

ame%Address%

P&one%


Client 8:s Agent for ,inance

ame% P&one%

Address%



35/49

PART @IB$ E*D+,1I,E

DECI-I+*-

California law allows competent adults t&e rig&t to refuse medical treatment. Please c&ooset&e option $elow t&at $est states our desires for end5of5life care. If neit&er does# ou canattac& a statement of our own to t&e document. T&e actual language used in t&e documentswill $e more compre&ensive t&an t&at presented $elow t&is language 'ust gives ou t&e idea $e&ind eac& c&oice/. ,ou will &ave t&e opportunit to review t&e actual language# andamend it if ou6d li4e# prior to signing.

C&oice ot To Prolong Life%

If I am suffering from a terminal condition from w&ic& deat& ise:pected in a matter of mont&s# or if I am suffering from an irreversi$le condition t&at renders me una$le to ma4e decisionsfor mself# and life5support treatments are needed to 4eep me alive# I request t&at all treatments ot&er t&an t&ose needed to 4eep me comforta$le $e discontinued or wit&&eld and m p&sicians allow me to die as gentl as possi$le.

Client 8Client H

C&oice To Prolong Life%

I want m life prolonged as long as possi$le wit&in t&e limits of generall accepted &ealt& care standards.

Client 8Client H

If neit&er of t&ose c&oices quite captures our wis&es wit& respect to end5of5life care#California law permits ou to ma4e our wis&es 4nown. Let me 4now if ou6d li4e moreinformation on end5of5life c&oices and suggested language.


36/49

PART @II$ >/IC? BA1A*CE -.EET TR/-T DI-TRIB/TI+*-

T&ese num$ers can $e appro:imations to wit&in 789#999

Assets 1ia!ilities

Real Estate% 7

Cas& 1avings% 7

1ecurities Personall(eld% 7

2ortgage% 7

;t&er De$t% 7

1ecurities (eld in*ro4erage Accounts% 7

;ptions% 7

Retirement Assets% 7

Annuities% 7

Life Insurance% 7

*usiness% 7

1u$total 7 1u$total% 7

et% 7

TR/-

T

DI-T

RIB/

TI+*

$

T&e mone left to our c&ildren will $e placed in trust# and managed for t&em $ t&e trustees t&at ou name. T&e trustee will use t&at mone

for t&eir &ealt education# and welfare. As t&e get older# t&is monewill $e distri$uted to t&em outrig&t# to $e used as t&e wis&. ,ou candirect t&ese distri$utions. A common wa to do t&is is to distri$utet&e assets in t&ree lump sums at ages ou c&oose# $ut t&ere is a lotof fle:i$ilit availa$le in t&ese terms. I suggest ou t&in4 first a$out&ow old ou were w&en ou were a$le to manage moneresponsi$l# and t&en wor4 $ac4wards from t&ere.

?at

?at


37/49

*alance at

>>? at H=# for e:ample/@9? at >H# for e:ample/899? at >


38/49

PART @III$ D+C/4E*T-

Please provide copies of t&e following documents or provide me wit& t&e requested information%

oo

o Account 1tatements including c&ec4ing and savings# $ro4erage# mutual funds#custodial accounts# mone mar4et funds# retirement plans# certificates of deposit and treasur $ills/# or%

Institution Account Tpe% Account Q Institution Account Tpe% Account Q Institution Account Tpe% Account Q Institution Account Tpe% Account Q Institution Account Tpe% Account Q Institution Account Tpe% Account Q

o 1toc4 certificates ou &old.

o Information a$out vested options including# w&ere possi$le# t&e grant dates# num$ersof s&ares# $asis for eac& grant and current price/.

o Documents related to loans ou &ave made to ot&ers not mone ou &ave $orrowed/.

o 0ace pages for life insurance and annuities including polic num$ers and deat& $enefit amounts/# or%

Polic Provider Polic um$er Polic Provider Polic um$er Polic Provider Polic um$er

Polic Provider Polic um$er

o Copies of an e:isting estate plan documents including wills and trusts# if an/.

o 1mall $usiness documents.Corporations% Articles of Incorporation# stoc4 certificates. Partners&ips% Partners&ip agreements# list of partners&ip assets.1ole Proprietors&ips% List of assets# account statements.

o 2artial propert agreements# if an premarital agreements# post5marital agreementsandNor marital separation agreements/.

o 0inal 'udgment from divorce proceedings if applica$le/.

o Documents reflecting owners&ip of patent# coprig&t or trademar4# if an.


39/49

1egal 4atters

1egal -erices Agreement

T&is document sets out t&e terms of our engagement. Please read it carefull $efore our first meeting.

Disclosure

T&ere are alwas potential conflicts of interest w&en a lawer represents more t&an one person. T&is document discloses t&ose issues.


40/49

1E0A1 -ER@ICE- A0REE4E*T

2Client +riginal3

T&is is t&e written fee agreement BAgreement/ t&at California law requires attornes to

&ave wit& t&eir clients. 0amil+ise Estate Planning B0amil+ise/ will provide legalservices to BClient/ on t&e terms set fort& $elow.

8. C onditions . T&is Agreement will not ta4e effect# and 0amil+ise will &ave noo$ligation to provide legal services# until Client returns a signed cop of t&isAgreement and pas t&e initial deposit called for under Paragrap& @. (owever# if 0amil+ise does elect to render services to Client prior to t&at time# t&e terms of t&isAgreement will appl to all suc& services.

H. L e g a l 1 er vi c e s to $ e P r o vid e d . Client &ires 0amil+ise to provide legal services in

connection wit& estate planning# specificall drafting t&e following documents%

L ivi n g T r ust P o r tf olio f or 2 arr ie d C oupl e % Two5settlor Living Trust 1c&edule of Trust Assets Pour5over +ills H/ Certification of Trust% Dura$le Power of Attornefor Propert 2anagement H/ Advance (ealt& Care Directive H/ (IPAA Release0orms H/ Trust Transfer Deed for Primar Residence in California.

L ivi n g T r ust P o r tf o l io f or 1 in g le P er son % ;ne5settlor Living Trust 1c&edule of Trust Assets Pour5over +ill Certification of Trust Dura$le Power of Attorne for Propert 2anagement Advance (ealt& Care Directive (IPAA Release 0ormsTrust Transfer Deed for Primar Residence in California.

+ ill P o r tf olio f or 2 arr ie d C oupl e % +ills H/ Dura$le Power of Attorne for Propert 2anagement H/ Advance (ealt& Care DirectiveH/% (IPAA Release 0ormsH/

+ ill P o r tf olio f or 1 in g le Pe r son % +ill Dura$le Power of Attorne for Propert 2anagement Advance (ealt& Care Directive% (IPAA Release 0orms

; t& e r D o c u m e nts # as specified%

0amil+ise will provide t&ose legal services reasona$l required to represent Client.0amil+ise will ta4e reasona$le steps to 4eep Client informed of progress and torespond to Client6s inquiries. Client ma request 0amil+ise to represent t&einterests of Client in different or additional matters# alt&oug& 0amil+ise will $e


41/49

under no o$ligation to accept suc& additional engagements. If 0amil+ise# in itsdiscretion# elects to underta4e an additional engagements# 0amil+ise ma confirmsuc& new assignments/ in writing# including a description of t&e wor4 to $e performed and an special provisions t&at mig&t appl wit& respect to t&at particular engagement# including an additional deposits/ t&at mig&t $e required. E:cept as

amended $ suc& special provisions# all additional engagements will $e su$'ect to t&egeneral provisions of t&is Agreement.

>. L e g a l 1 er vi ce s 1 p ec i f ic a ll E : c lud e d . Legal services t&at are e:cluded under t&isAgreement specificall include# $ut are not limited to# t&e following% an assettransfers not specificall set fort& in Paragrap& H# including preparing and recordingout5of5state propert deeds# consultations after t&e completion of t&e estate planningdocuments listed in Paragrap& H of t&is Agreement# review of documents in additionto t&ose listed in Paragrap& H# independent inquir# legal researc correspondence#and an activit related to litigation. If Client wis&es 0amil+ise to provide anlegal services e:cluded under t&is Agreement# a separate written agreement $etween

0amil+ise and Client will $e required. Provided t&e pament required $Paragrap&s @ &ave $een offered and accepted for t&e period during w&ic& Clientrequests t&at 0amil+ise underta4e t&e legal services# 0amil+ise will enter intosuc& an agreement for legal services on t&e same terms and conditions as aret&en $eing included in its &ourl5fee legal services agreements wit& ot&er estate planning clients.

J. C li e nt 6 s D uti e s . Client agrees to $e trut&ful wit& 0amil+ise# to cooperate# to 4eep0amil+ise informed of an information or developments w&ic& ma come toClient6s attention# to a$ide $ t&is agreement# to pa 0amil+ise6s $ills on time andto 4eep 0amil+ise advised of Client6s address# telep&one num$er and w&erea$outs.Client will assist 0amil+ise in providing information and documents necessar for t&e representation in t&e descri$ed matter.

@. L e g a l 0 e e s a nd * illing P rac ti ce s . Client will pa to 0amil+ise t&e fi:ed sum of 7 for attorne fees for t&e legal services to $e provided under t&is Agreement# paa$le as follows% S paa$le upon e:ecution of t&e Agreement and S paa$le upondeliver of t&e draft documents. T&e paments are nonrefunda$le. AdditionalCalifornia propert will $e transferred into t&e trust for a fee of 7H@9 eac&. If Clientfails to complete t&e legal wor4 provided under t&is Agreement wit&in 8H mont&s of t&e date of t&is Agreement# 0amil+ise ma close Client6s file and terminate itsengagement wit& Client. Client s&all &ave t&e rig&t to re5engage 0amil+ise after suc& 8H5mont& period at 0amil+ise6s t&en5current rates.


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receiving notice of a fee c&ange# 0amil+ise will &ave t&e rig&t to wit&draw asattorne for Client. Time is c&arged in minimum units of one tent& .89/ of an &our.

. C on c lusion of R e p re s e nt a tion . Client ma disc&arge 0amil+ise at an time.0amil+ise ma wit&draw wit& Client6s consent or for good cause. Mood cause

includes Client6s $reac& of t&is Agreement# refusal to cooperate or to follow0amil+ise6s advice on a material matter or an fact or circumstance t&at wouldrender 0amil+ise6s continuing representation unlawful or unet&ical. If Clientdisc&arges 0amil+ise# 0amil+ise is entitled to retain all legal fees. If 0amil+isewit&draws from representation# 0amil+ise is onl entitled to retain legal fees equalto t&e amount t&at would &ave $een due to 0amil+ise if suc& fees were incurred onan &ourl $asis at 0amil+ise6s regular &ourl rates. After services conclude#0amil+ise will# upon Client6s request# deliver a cop of Client6s file# and all client propert in 0amil+ise6s possession# w&et&er or not Client &as paid for all services.

=. D is c la im e r of M u ara nt e e a nd Estim a te s . ot&ing in t&is Agreement and not&ing in

0amil+ise6s statements to Client will $e construed as a promise or guarantee a$outt&e outcome of t&e matter. Due to man factors in&erent in legal representation# t&eoutcome of an matter is unpredicta$le and 0amil+ise ma4es no suc& promises or guarantees. 0amil+ise6s comments a$out t&e outcome of t&e matter are e:pressionsof opinion onl.

. El ec tr onic C ommuni ca ti ons . ,ou &ave aut&ori!ed 0amil+ise to communicate wit&ou via email and ot&er electronic means suc& as $ fa:. ,ou will $e responsi$le for 4eeping suc& communications confidential. ,ou also ac4nowledge t&atcommunication $ electronic means is su$'ect to interception $ ot&ers# 'ust as is mailand ot&er forms of communication. * aut&ori!ing us to communicate wit& ou viaelectronic means# ou are assuming an ris4s associated t&erewit&. +e strive tomaintain a secure electronic communication sstem wit& updated virus protectionsoftware.

89. Enti r e A g r ee m e nt . T&is Agreement contains t&e entire Agreement of t&e parties. oot&er agreement# statement or promise made on or $efore t&e Effective Date of t&isAgreement will $e $inding on t&e parties.

88. 1 e v era $ili t in Ev e nt of P ar ti a l I nv a lidi t . If an provision of t&is Agreement is &eldin w&ole or in part to $e unenforcea$le for an reason# t&e remainder of t&at provisionand of t&e entire Agreement will $e severa$le and remain in effect.

8H. 2odi f ica tion $ 1 u$s e q u e nt A g ree m e nt . T&is Agreement ma $e modified $su$sequent Agreement of t&e parties onl $ an instrument in writing signed $ $ot&of t&em or an oral agreement onl to t&e e:tent t&at t&e parties carr it out.

8>. E ffec tive Da te . T&is Agreement will govern all legal services performed $0amil+ise on $e&alf of Client commencing wit& t&e date 0amil+ise first performed services. T&e date at t&e $eginning of t&is Agreement is for reference onl.


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Even if t&is Agreement does not ta4e effect# Client will $e o$ligated to pa0amil+ise t&e reasona$le value of an services 0amil+ise ma &ave performedfor Client.

C irc ul a r H>9 oti ce . Pursuant to requirements set fort& in -.1. Treasur Regulation Circular H>9# 1ection 89.>@# ou are informed t&at t&is written advice is not intended or written to $eused and cannot $e used for t&e purpose of avoiding ta: penalties t&at ma $e imposed under t&e Internal Revenue Code. 0urt&ermore# additional ta: issues ma e:ist t&at could affect t&eta: treatment of t&e transaction and t&is correspondence does not consider or provide aconclusion wit& respect to an additional issues.

T ( E P A R T I E1 (AF E R E A D A D -D E R1 T ;; D T ( E 0 ; R E M ; I M TE R 21 A DAM R EE T; T ( E2 A 1 ; 0 T ( E DA TE 0 A 2 I L , + I 1 E 0 I R1 T PR ; F I D ED 1 E R F I C E 1 .I0 2;RE T(A ;E CLIET 1IM1 *EL;+# EAC( AMREE1 T; *E LIA*LE#K;ITL, AD 1EFERALL,# 0;R ALL ;*LIMATI;1 -DER T(I1 AMREE2ET.

T(E CLIET 1(ALL RECEIFE A 0-LL, EUEC-TED D-PLICATE ;0 T(I1AMREE2ET.

DATED%

1ignature/

ame%Address%

Telep&one%

DATED%

1ignature/

ame%Address%

Telep&one%

DATED% 0A2IL,+I1E E1TATEPLAIM

*% Oim$erle 1pears# Esq.


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under no o$ligation to accept suc& additional engagements. If 0amil+ise# in itsdiscretion# elects to underta4e an additional engagements# 0amil+ise ma confirmsuc& new assignments/ in writing# including a description of t&e wor4 to $e performed and an special provisions t&at mig&t appl wit& respect to t&at particular engagement# including an additional deposits/ t&at mig&t $e required. E:cept as

amended $ suc& special provisions# all additional engagements will $e su$'ect to t&egeneral provisions of t&is Agreement.

>. L e g a l 1 er vi ce s 1 p ec i f ic a ll E : c lud e d . Legal services t&at are e:cluded under t&isAgreement specificall include# $ut are not limited to# t&e following% an assettransfers not specificall set fort& in Paragrap& H# including preparing and recordingout5of5state propert deeds# consultations after t&e completion of t&e estate planningdocuments listed in Paragrap& H of t&is Agreement# review of documents in additionto t&ose listed in Paragrap& H# independent inquir# legal researc correspondence#and an activit related to litigation. If Client wis&es 0amil+ise to provide anlegal services e:cluded under t&is Agreement# a separate written agreement $etween

0amil+ise and Client will $e required. Provided t&e pament required $Paragrap&s @ &ave $een offered and accepted for t&e period during w&ic& Clientrequests t&at 0amil+ise underta4e t&e legal services# 0amil+ise will enter intosuc& an agreement for legal services on t&e same terms and conditions as are t&en $eing included in its &ourl5fee legal services agreements wit& ot&er estate planningclients.

J. C li e nt 6 s D uti e s . Client agrees to $e trut&ful wit& 0amil+ise# to cooperate# to 4eep 0amil+ise informed of an information or developments w&ic& ma come toClient6s attention# to a$ide $ t&is agreement# to pa 0amil+ise6s $ills on time andto 4eep 0amil+ise advised of Client6s address# telep&one num$er and w&erea$outs.Client will assist 0amil+ise in providing information and documents necessar fort&e representation in t&e descri$ed matter.

@. L e g a l 0 e e s a nd * illing P rac ti ce s . Client will pa to 0amil+ise t&e fi:ed sum of 7 for attorne fees for t&e legal services to $e provided under t&is Agreement# paa$le as follows% S paa$le upon e:ecution of t&e Agreement and S paa$le upondeliver of t&e draft documents. T&e paments are nonrefunda$le. AdditionalCalifornia propert will $e transferred into t&e trust for a fee of 7H@9 eac&. If Clientfails to complete t&e legal wor4 provided under t&is Agreement wit&in 8H mont&s of t&e date of t&is Agreement# 0amil+ise ma close Client6s file and terminate itsengagement wit& Client. Client s&all &ave t&e rig&t to re5engage 0amil+ise after suc& 8H5mont& period at 0amil+ise6s t&en5current rates.


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receiving notice of a fee c&ange# 0amil+ise will &ave t&e rig&t to wit&draw asattorne for Client. Time is c&arged in minimum units of one tent& .89/ of an &our.

. C on c lusion of R e p re s e nt a tion . Client ma disc&arge 0amil+ise at an time.0amil+ise ma wit&draw wit& Client6s consent or for good cause. Mood cause

includes Client6s $reac& of t&is Agreement# refusal to cooperate or to follow0amil+ise6s advice on a material matter or an fact or circumstance t&at wouldrender 0amil+ise6s continuing representation unlawful or unet&ical. If Clientdisc&arges 0amil+ise# 0amil+ise is entitled to retain all legal fees. If 0amil+isewit&draws from representation# 0amil+ise is onl entitled to retain legal fees equalto t&e amount t&at would &ave $een due to 0amil+ise if suc& fees were incurred onan &ourl $asis at 0amil+ise6s regular &ourl rates. After services conclude#0amil+ise will# upon Client6s request# deliver a cop of Client6s file# and all client propert in 0amil+ise6s possession# w&et&er or not Client &as paid for all services.

=. D is c la im e r of M u ara nt e e a nd Estim a te s . ot&ing in t&is Agreement and not&ing in

0amil+ise6s statements to Client will $e construed as a promise or guarantee a$outt&e outcome of t&e matter. Due to man factors in&erent in legal representation# t&eoutcome of an matter is unpredicta$le and 0amil+ise ma4es no suc& promises or guarantees. 0amil+ise6s comments a$out t&e outcome of t&e matter are e:pressionsof opinion onl.

. El ec tr onic C ommuni ca ti ons . ,ou &ave aut&ori!ed 0amil+ise to communicate wit&ou via email and ot&er electronic means suc& as $ fa:. ,ou will $e responsi$le for 4eeping suc& communications confidential. ,ou also ac4nowledge t&atcommunication $ electronic means is su$'ect to interception $ ot&ers# 'ust as is mailand ot&er forms of communication. * aut&ori!ing us to communicate wit& ou viaelectronic means# ou are assuming an ris4s associated t&erewit&. +e strive tomaintain a secure electronic communication sstem wit& updated virus protectionsoftware.

89. Enti r e A g r ee m e nt . T&is Agreement contains t&e entire Agreement of t&e parties. oot&er agreement# statement or promise made on or $efore t&e Effective Date of t&isAgreement will $e $inding on t&e parties.

88. 1 e v era $ili t in Ev e nt of P ar ti a l I nv a lidi t . If an provision of t&is Agreement is &eldin w&ole or in part to $e unenforcea$le for an reason# t&e remainder of t&at provisionand of t&e entire Agreement will $e severa$le and remain in effect.

8H. 2odi f ica tion $ 1 u$s e q u e nt A g ree m e nt . T&is Agreement ma $e modified $su$sequent Agreement of t&e parties onl $ an instrument in writing signed $ $ot&of t&em or an oral agreement onl to t&e e:tent t&at t&e parties carr it out.

8>. E ffec tive Da te . T&is Agreement will govern all legal services performed $0amil+ise on $e&alf of Client commencing wit& t&e date 0amil+ise first performed services. T&e date at t&e $eginning of t&is Agreement is for reference onl.


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Even if t&is Agreement does not ta4e effect# Client will $e o$ligated to pa0amil+ise t&e reasona$le value of an services 0amil+ise ma &ave performedfor Client.

C irc ul a r H>9 oti ce . Pursuant to requirements set fort& in -.1. Treasur Regulation Circular

H>9# 1ection 89.>@# ou are informed t&at t&is written advice is not intended or written to $eused and cannot $e used for t&e purpose of avoiding ta: penalties t&at ma $e imposed under t&e Internal Revenue Code. 0urt&ermore# additional ta: issues ma e:ist t&at could affect t&eta: treatment of t&e transaction and t&is correspondence does not consider or provide aconclusion wit& respect to an additional issues.

T ( E P A R T I E1 (AF E R E A D A D -D E R1 T ;; D T ( E 0 ; R E M ; I M TE R 21 A DAM R EE T; T ( E2 A 1 ; 0 T ( E DA TE 0 A 2 I L , + I 1 E 0 I R1 T PR ; F I D ED 1 E R F I C E 1 .I0 2;RE T(A ;E CLIET 1IM1 *EL;+# EAC( AMREE1 T; *E LIA*LE#K;ITL, AD 1EFERALL,# 0;R ALL ;*LIMATI;1 -DER T(I1 AMREE2ET.T(E CLIET 1(ALL RECEIFE A 0-LL, EUEC-TED D-PLICATE ;0 T(I1

AMREE2ET.

DATED%

1ignature/

ame%Address%

Telep&one%

DATED%

1ignature/

ame%Address%

Telep&one%

DATED% 0A2IL,+I1E E1TATEPLAIM

*% Oim$erle1pears# Esq.


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D I - C 1 + - / R E

Potential Conflict of Interest$ It is possi$le t&at ou ma not agree wit& eac& ot&er regarding ever detail of our estate plans. 0or e:ample# ou ma &ave differing views as to

&ow ou want to dispose of our propert# or w&o ou s&ould appoint as guardians. 2inor disagreements $etween couples are normal and ordinaril will not affect m a$ilit torepresent eac& of ou full and fairl# provided we can come to resolution of t&e issue andcomplete t&e plan.

Actual Conflict of Interest; +&ile it is rare# couples will occasionall &ave seriousdisagreements. If t&at tpe of disagreement were to arise# it could create a conflict of interestt&at would ma4e it impossi$le for me to represent $ot& of ou in a manner consistent wit&m et&ical and professional o$ligations. If suc& a disagreement did arise# I would find itnecessar to wit&draw from representing eit&er of ou in connection wit& t&is matter.

Consultation "ith Independent Attorney. ;f course# if eit&er of ou feel for an reasont&at ou need t&e advice of anot&er attorne regarding an aspect of t&e services I am providing to ou# ou s&ould o$tain our own attorne to provide advice and counsel in t&ismatter# and to assure ourself t&at m representation of one of ou is not adverselinfluenced $ m representation of t&e ot&er.

Confidentiality; Ant&ing t&at eit&er of ou sas to me is protected $ attorne5client privilege and will $e &eld in strictest confidence wit& respect to t&e rest of t&e world.(owever# ant&ing one of ou communicates to me must $e communicated to t&e ot&er. 0or e:ample# if one of ou told me somet&ing during t&e course of t&e representation and as4edme to 4eep it from t&e ot&er# I would $e dut $ound ;T to &onor t&at request. Li4ewise# inan future legal proceeding $etween t&e two of ou# our communications during t&e courseof representation could $e used $ t&e ot&er.

;$viousl# we &ave no reason to $elieve now t&at an of t&ese pro$lems will arise in our wor4 toget&er. In fact# t&ese tpes of situations are ver rare. evert&eless# t&e Rules of Professional Responsi$ilit governing t&e conduct of lawers rig&tfull require t&at I e:plaint&e potential issues t&at could arise if I represent $ot& of ou at t&e same time. T&e sameRules require t&at I o$tain our e:press written consent to t&is 'oint representation. It&erefore as4 t&at ou sign t&is disclosure and give it to me w&en we meet. If ou &ave anadditional questions a$out t&ese disclosures# please let me 4now.

"e have read this disclosure, understand the matters discussed in it and agree to have

Kimberley &pears 'ointly represent us, hereby waiving potential conflicts of interest in the preparation of our estate documents.

Dated% NN

Dated% N N


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D I - C 1 + - / R E

Potential Conflict of Interest$ It is possi$le t&at ou ma not agree wit& eac& ot&er

regarding ever detail of our estate plans. 0or e:ample# ou ma &ave differing views as to&ow ou want to dispose of our propert# or w&o ou s&ould appoint as guardians. 2inor disagreements $etween couples are normal and ordinaril will not affect m a$ilit torepresent eac& of ou full and fairl# provided we can come to resolution of t&e issue andcomplete t&e plan.

Actual Conflict of Interest; +&ile it is rare# couples will occasionall &ave seriousdisagreements. If t&at tpe of disagreement were to arise# it could create a conflict of interestt&at would ma4e it impossi$le for me to represent $ot& of ou in a manner consistent wit&m et&ical and professional o$ligations. If suc& a disagreement did arise# I would find itnecessar to wit&draw from representing eit&er of ou in connection wit& t&is matter.

Consultation "ith Independent Attorney. ;f course# if eit&er of ou feel for an reasont&at ou need t&e advice of anot&er attorne regarding an aspect of t&e services I am providing to ou# ou s&ould o$tain our own attorne to provide advice and counsel in t&ismatter# and to assure ourself t&at m representation of one of ou is not adverselinfluenced $ m representation of t&e ot&er.

Confidentiality; Ant&ing t&at eit&er of ou sas to me is protected $ attorne5client privilege and will $e &eld in strictest confidence wit& respect to t&e rest of t&e world.(owever# ant&ing one of ou communicates to me must $e communicated to t&e ot&er. 0or e:ample# if one of ou told me somet&ing during t&e course of t&e representation and as4edme to 4eep it from t&e ot&er# I would $e dut $ound ;T to &onor t&at request. Li4ewise# inan future legal proceeding $etween t&e two of ou# our communications during t&e courseof representation could $e used $ t&e ot&er.

;$viousl# we &ave no reason to $elieve now t&at an of t&ese pro$lems will arise in our wor4 toget&er. In fact# t&ese tpes of situations are ver rare. evert&eless# t&e Rules of Professional Responsi$ilit governing t&e conduct of lawers rig&tfull require t&at I e:plaint&e potential issues t&at could arise if I represent $ot& of ou at t&e same time. T&e sameRules require t&at I o$tain our e:press written consent to t&is 'oint representation. It&erefore as4 t&at ou sign t&is disclosure and give it to me w&en we meet. If ou &ave anadditional questions a$out t&ese disclosures# please let me 4now.

"e have read this disclosure, understand the matters discussed in it and agree to have Kimberley &pears 'ointly represent us, hereby waiving potential conflicts of interest in the

preparation of our estate documents.

Di Are State Planning

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Transcript of Di Are State Planning