Most people want to ensure the future stability and protection of their family and determine how their assets will be distributed when they pass. However, this process is not always straightforward. The Orange County probate lawyers at the Asset Protection and Elder Law Center help our clients protect everyone whom they love and everything that they own. How do we accomplish this ambitious goal? We begin by asking the right questions and learning about you. We make sure to understand your concerns and goals, and then we design a customized plan and create a long-term relationship with our clients to be there for them throughout the years when they need us most.
Often, estate planning involves creating wills and trusts. However, in California, a will alone does not avoid the probate court, which is why a revocable trust plan is so important. Many people do not realize the time and money that they will save when they create a solid trust plan. California’s rules are very different than the rest of the country, and if you have a home, business, or financial accounts totaling more than $188,500, a trust is the only way to keep your affairs private and away from the Court’s control. A trust is a legal contract under which someone whom you select and trust can control and follow your specific wishes on how to take care of your assets for the benefit of another party (children, family, etc.). Types of trusts include revocable living trusts and irrevocable trusts. A probate attorney in Orange County can assist you with either of these instruments. A revocable living trust allows you to keep control over your property while you are living and sets forth how your assets should be distributed upon your death. A proper estate plan also includes a financial power of attorney and advance healthcare directive to assist when you are ill, incapacitated, and need assistance from people whom you trust and select to manage your finances, business, and health. If you have children under 18, having a trust and estate plan is crucial for their protection and to appoint their legal guardians.
Probate When someone has no estate plan or only a will, depending on their assets, probate is a legal process in which the court controls a decedent’s assets to make sure that it is distributed properly and their debts are paid. If a decedent has no will, assets are distributed according to intestacy law. The court will appoint an executor to direct the procedure on behalf of a decedent’s heirs, and it requires the filing of many legal documents, all of which are open to the public. Generally speaking, the average probate case in California is 1-2 years, and it takes several months before the family can have access to the decedent’s assets or home. Unfortunately, California’s probate system is the most expensive and lengthy in the entire country, but our Orange County probate attorneys can assist you. There are tools that can be used to avoid probate – the best one is creating a trust or adding a payable on death designation to an account, or holding title with a right of survivorship.
Trust Administration When a loved one passes who has a trust, the Trustee(s) must administer trusts according to their terms. If all of the decedent’s assets are titled under the trust, the trustee can administer the trust privately without the need for probate court. They need to provide notice of trust administration to all legal heirs and beneficiaries of the trust. They also provide notice to creditors so that their claims can be promptly initiated as appropriate. A party that wants to contest the trust must do so within 120 days of getting notice. Trustees have a fiduciary duty to invest any assets in the trust in a prudent and reasonable way and follow the exact wishes of the grantor/trustmaker to distribute assets to beneficiaries according to the trust terms. The probate attorneys at our Orange County firm have years of experience in trust administration and have administered hundreds of trusts, small and large, successfully, many of which we are able to do on a flat fee retainer.
Asset Protection Advanced planning is allowed to legally protect yourself from future creditors and liens. This can be done with irrevocable trust plans, spendthrift trusts, and domestic and offshore trust plans so long as there is no pending or past legal action, claim, or tort. The law does not allow someone to create an asset protection plan to avoid a current creditor or claim against them but does allow people to plan ahead to avoid future creditors or protect children’s and beneficiaries’ inheritances. Generally, people of substantial means create offshore trusts or trusts in another state that provides for specific asset protection, since these plans are permanent and created to protect substantial assets. There are also private retirement plans that you can choose to protect IRA/401K assets for retirement purposes. You should consult a probate attorney in Orange County about the asset protection strategies available to you.
Elder Law Our elder law practice focuses on medical planning. Many elders need long-term care late in life and want Medi-Cal, a government program, to pay for that care at a skilled nursing facility, rehabilitation center, or subacute facility because care is expensive and can quickly drain resources. To qualify for Medi-Cal, you will need to show that you have limited resources. Non-exempt assets will be counted as part of your property, such that you could be disqualified from Medi-Cal if you exceed a certain threshold. It is important to conduct medical pre-planning to adequately protect your finances as you get older while also allowing you to obtain benefits. This involves a reallocation of your resources so that they will not be considered in an eligibility determination. California currently has a three-year look back period, so if you know that you may need this type of planning, you should consult a probate lawyer in Orange County who can help you do it years in advance before your medical needs demand government assistance.
Special Needs Planning You may be worried about what will happen to a child or a loved one over the age of 18 who has a mental or physical disability in the event that you can no longer care for them. A special needs trust can be created to hold assets for a disabled child or family member and provide specific instructions for their care and day-to-day needs. A special needs trust, when done in advance and drafted carefully, can protect the person with a disability from losing any government benefits that they may be receiving as a result of their disability. A parent or loved one can leave the person with a disability a trust with unlimited funds and assets and protect those funds from third parties and still allow them to continue receiving SSI or medical or other government benefits. Our Orange County probate lawyers can help you with special needs trust planning because we have extensive experience in the creation of third-party and even self-funded special needs trust plans.
Tax Planning California has a very high tax rate, and clients need to determine if they have an estate tax liability at the time of their death or their parent’s passing. However, there are ways to try to minimize the taxes paid by your estate during your life and after you pass. Tools that might be appropriate include irrevocable trusts, charitable trusts, gifts, and irrevocable life insurance trusts. Certain retirement accounts may provide tax benefits, although they will restrict and penalize you if you make an early withdrawal. As of 2021, you have a lifetime exemption that allows you to transfer a maximum of $11.58 million free of estate and gift tax, as well as generation-skipping transfer tax. However, in the coming years, the estate tax exemption is believed to decrease substantially from this amount, depending on politics and our nation’s deficit. Proper planning and having a long-standing relationship with an estate planning attorney is key to effective income and estate tax planning. Our estate lawyers are happy to consult with you on these and other effective pre-planning options for you, your business, and your family.
Life Insurance Planning Many people want to purchase a life insurance policy to take care of their loved ones in case of their unexpected death. When an insured person dies, the life insurance company pays a certain amount to the beneficiaries that can be used for their support and well-being. You can create an irrevocable life insurance trust (ILIT) to ensure that life insurance proceeds are not reduced by federal or state death taxes when you die and to protect the life insurance monies from being squandered or claimed by creditors or a nasty divorce. Effective life insurance planning is key to make sure that it is not subject to California probate or estate taxes, or abused in the future by third parties or the beneficiaries themselves.
Consult a Knowledgeable Probate Lawyer in Orange County If you need to devise an estate plan or navigate probate, you should talk to a seasoned attorney about your situation. At the Asset Protection and Elder Law Center, we represent people in communities such as Huntington Beach, Laguna Niguel, Laguna Beach, Irvine, Costa Mesa, and Newport Beach, to name a few. We use plain language and work hard to make sure that our clients truly understand the options available to them. We use a flat fee model to make sure that our legal services are equitable and affordable and so that we can focus on the client-attorney relationship and provide high-end legal representation and planning that will last through all the seasons and changes of our clients’ lives. We love the work that we do and the relationships that we have maintained throughout the years with all of our clients and have had great success in protecting them, their businesses, their personal assets, their family home, and best of all their children and families in general. Call us at (714) 966-2646 or contact us via our online form.