What every financial planner

WHAT EVERY FINANCIAL

PLANNERSHOULD KNOW

ABOUTESTATE PLANNING &ASSET PROTECTIONwww.TrustLegalGroup.com/

Education

www.TrustLegalGroup.com/Education

The Purpose of Planning Obstacles: Probate &Taxes Basic Estate Planning 101 Complex Estate Planning 101 Asset Protection Planning 101

Introduction-Purpose of Planning

-Probate and Taxes

-Basic Estate Planning 101

-Complex Planning 101

-AssetProtection 101


…to manage assets during life; …to manage responsibilities and assets during incapacity; and

…to properly care for and distribute estate upon death.

The Purpose of Planning-Purpose of Planning

-Probate and Taxes





Probate◦ …a court-supervised process to transfer

assets from a deceased individual to a beneficiary.

◦ Extremely expensive.◦ Extremely complicated / lengthy.

Case Studies:

Obstacles: Probate & Taxes-Purpose of Planning

-Probate and Taxes





Conservatorship / Guardianship Hearings (Probate Court)◦ Without an estate plan, a court will

determine if you are incapacitated, and if so, who is to care for you and your children.

Case Study:


-Probate and Taxes





Taxes◦ Estate Taxes

…approximately 50% tax on net worth upon death.

◦ Capital Gains Taxes …tax on profit upon sale of property.

◦ Income Taxes …easily reduced through advanced planning

opportunities.


-Probate and Taxes





Keep The Goals, and The Obstacles in Mind

Estate Planning Options◦ …do nothing at all.◦ …create a Will.◦ …own property jointly with another.◦ …create a living trust / comprehensive

estate planning package.

Basic Estate Planning 101-Purpose of Planning

-Probate and Taxes



-AssetProtection 101>>> Let’s evaluate these

options


Doing Nothing at All◦ No tax planning opportunities;◦ No protection upon incapacity;◦ No asset protection after death; ◦ No decision on how to distribute estate; and◦ Full probate (with associated fees and

delays).

Create a Will◦ Same results as if doing nothing at all,

EXCEPT you can choose how estate is distributed. That is all.


-Probate and Taxes





Jointly Owning Property◦ No tax planning opportunities;◦ No protection upon incapacity;◦ No asset protection after death; and◦ Increased liability; BUT◦ No probate (which is good).


-Probate and Taxes





Living Trust / Comprehensive Estate Plan◦ Protection upon incapacity;◦ Asset protection capabilities (limited);◦ Ability to appoint individuals to act as

agents upon incapacity and death;◦ Complete authority to plan distribution.◦ No probate.

◦ (SOLVES ALL OF THE ISSUES RELATING TO ESTATE PLANNING)


-Probate and Taxes





How a Comprehensive Plan Operates◦ …Living Trust is at the core;

Separate entity to hold assets that survives your incapacity and death, upon which designated successors take over, and our bound to specified terms and conditions;

◦ …Powers of Attorney / Advance Healthcare Directives; Documents to appoint agents to act on your behalf.

◦ …Pourover Will Document which appoints guardians for your children (among

other things).

◦ …Ancillary Documents (Supportive and Extra

Protection).


-Probate and Taxes





Specific Situations◦ …special needs beneficiaries;◦ …business interests; and◦ …investment properties, etc.

The Estate Tax◦ …50% tax on one’s net worth upon death.

$1,000,000 exclusion

◦ …many vehicles exist which can structure assets in a manner which allows them to not meet the definition of “net worth.”

Complex Planning 101-Purpose of Planning

-Probate and Taxes





What Does Asset Protection Do?◦ The effect is to essentially make it difficult for

creditors to come after the client.◦ Most plans take jurisdiction out of state or

country, making it expensive for creditors.◦ EXCEPTION: Creating an LLC or Corp. is

almost always a sure bet (in limited circumstances).

Fraudulent Transfer Rule◦ …cannot engage in asset protection for the

sole purpose of defrauding creditors.◦ …can do it ahead of time to protect yourself.

Asset Protection 101-Purpose of Planning

-Probate and Taxes





More Information . . . .


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