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What Happens To My Joint Trust If I Get Divorced?

What Happens To My Joint Trust If I Get Divorced?

 

 

What Happens To My Joint Trust If I Get A Divorce?

What Happens To My Joint Trust If I Get Divorced?

              Going through a divorce can be an extremely painful, stressful and seemingly unending process.  It affects so many different aspects of your life.  This article discusses just one of the effects, which is your estate planning, including your living trust, will and power of attorney documents.

What happens to my estate plan when I get divorced?

This is a great question and one that a qualified estate planning lawyer Dardenne Prairie can assist you with.  In Missouri, a divorce essentially treats any distributions intended for your ex-spouse as void.  In other words,  you have a will, it says that when you pass everything goes to your ex-spouse, but upon finalization of the divorce, that provision for your now ex-spouse is treated as if they have predeceased you and therefore the distribution would pass to your contingent beneficiaries, which would usually be your children.

What happens if I have assets that will avoid probate, such as a life insurance policy?

The Missouri law treating the ex-spouse as a voided beneficiary only covers assets in probate.  If you had a life insurance policy that left your soon to be ex-spouse as the primary beneficiary, you would need to change that after divorce, because if you pass away, your ex-spouse would inherit.  This happens all the time, unfortunately, and that’s why it’s important to have a game plan to review your estate plan (or establish one) after your divorce is final.

The second thing to note is that any distribution to your ex-spouse upon your passing is only void if the divorce is final.  If you expect your divorce to be extended for a period of time, it’s important to meet with an estate planning attorney to make changes anyway.  Under Missouri law, you can adjust your estate plan to cut out your soon to be ex-spouse.  You can’t completely cut them out (unless you have a prenuptial agreement or postnuptial agreement), but you can ensure that they will not inherit everything, which would be the case if you did nothing and passed before your divorce was finalized.

What happens if I have a trust and am getting divorced?

That depends on the type of joint trust you have.  An irrevocable trust attorney O’Fallon, Missouri  can explain in more detail, but the terms of this type of trust cannot be changed after the trust is created, regardless of divorce.  This type of joint trust, however, is usually created by spouses to benefit their children.

If, on the other hand, you have a revocable joint trust, both spouses can retain control over the assets.  Of course, this assumes you would want to do that.  Most of the time, spouses want to dissolve their trust and distribute assets as agreed in their marital settlement agreement.  From there, you can take the safest step and create a new estate plan with your own trust, a new will and new powers of attorney.  You’d probably want to do that anyway, since your now ex-spouse is usually listed as your principal in your healthcare power of attorney and durable power of attorney documents.

Do you really want your ex-spouse making healthcare calls for you at the end of life?  Me neither.

As you can see, the best practice, at a minimum, when you are going through a divorce is to sit down and review your estate plan with an experienced estate planning attorney.

 

 

Do You Have To Change Your Estate Plan If You Move Out Of State?

Do You Have To Change Your Estate Plan If You Move Out Of State?

DO YOU HAVE TO CHANGE YOUR ESTATE PLAN IF YOU MOVE OUT OF STATE?

A common question from clients that move away from Missouri is do they need to change their estate planning that I completed for them.

The answer is probably.  Here’s why:

Each state has different laws with respect to estate taxes, trusts and many have adopted different statutes with respect to probate and inheritance generally.

Here’s an example:

I used to practice law in New Jersey, which had, at least at that time, a statute that required some beneficiaries from wills and trusts, usually farther than an immediate family member like a cousin or an uncle, to pay inheritance tax on anything received from a relative’s estate.

Attorneys draft estate plans to take to the most advantage out of weakly drafted statutes or to utilize breaks in the law.  And so we drafted wills and trusts in New Jersey that not only had provisions for that very specific inheritance law but took advantage of it where possible.

Different laws among states is not the only reason why you should amend or change your estate plan if you move away from Missouri.

Another issue is the perception by some that out of state documents are a problem.  Banks are a really good example of what I would call a “skittish acceptor” of legal documents.  Having dealt with banks (and faced repeated non-issues made into issues by them) as a probate lawyer St Peters, I can tell you that there is the way things are and the way banks what things to be.

One of the biggest problems with banks is that they no longer train their employees well enough.  As a result, any legal documents are often met with an immediate call to the “legal department”, which is almost always in another state and, as a rule, routinely denies the validity of a document.  This is often just because the bank employee couldn’t properly explain the issue to the legal department and since the default answer at legal is “no”, you might end up in a difficult situation where you have a perfectly acceptable legal document that you cannot utilize because of the bank.

So what am I saying?  Well, you could run into a problem at a bank and since you won’t find out until it’s maybe too later to fix the problem, it’s always the safer practice to update your estate when you move.

By the way, that process is relatively simple.  If you have a Missouri living trust, you’ll need to change the “governing law” provision in your trust document.  It will be Missouri and need to be changed to whatever state you have moved to.  Note that this is a relatively simple change because you’re simply amending your trust to change that one provision, not re-writing the whole thing.

Since you might be moving closer to other loved ones who might now be closer than they were before, it might make sense to add them as power of attorney, healthcare proxies, executors and trustees.

A qualified and experience estate planning lawyer where you move to can review your Missouri plan and help you pinpoint other changes, if any.

Estate Planning with a Trust in Mind

Estate Planning Lawyer O’Fallon, MO

When considering whether creating a trust for beneficiaries should be included in your estate plan, contact an attorney. Not only may they be able to cover all the bases, they can give both you and your family peace of mind that your final wishes have been put to paper. For some, creating a trust for beneficiaries can be an attractive option for a number of reasons. Your attorney can provide you with the education and knowledge you require to make decisions regarding your estate plan that are right for you and your loved ones.

Protecting Your Legacy

It’s a common misconception that a trust is reserved for only the uber wealthy. In fact, creating a trust can be an attractive option for many people. Your attorney will work with you and discuss your goals to help determine the proper trust to create for you and your loved ones. There are a number of advantages to developing a trust:

  • May give beneficiaries quicker access to assets upon your passing
  • May circumvent the probate process
  • Can reduce, or even avoid estate taxes
  • You can remain in control over how money is dispersed or distributed. In some trusts, you can even articulate certain conditions in order for the beneficiary to obtain assets.
  • Can preserve assets for generations to come by retaining wealth in a fund that allows for it to continue to grow.

For many, one of the most important things is protecting the legacy that has taken a lifetime to build. Not only can your attorney review your financial situation, our services can help you safeguard all that you have worked so hard for.

Reasons to Access an Attorney

The services of an attorney can help a dreaded process move smoothly and efficiently. Developing a trust can feel a bit overwhelming. You will want to make sure that you have covered everything. An attorney can prove to be helpful in a number of ways:

  • To ensure that the trust incorporates all key elements
  • Help manage any complicated situations that may come up
  • Develop a clear estate plan
  • To guide you in the required documentation needed to put together your plan
  • Listen to your needs and provide you with key legal information to make the most informed decision

It’s easy to continue putting off such an important process. Attorneys have heard every excuse in the book. While they are all valid, we both know the last thing you want is to leave your family with no instructions regarding how you would like your wishes carried out. Not only can your attorney put together trust accounts that provide a number of benefits, they can also ensure that your estate plan leaves nothing out.

If you have not yet taken the steps to create your estate plan, contact an estate planning lawyer O’Fallon, MO relies on at Legacy Law Center today. This will not only allow for you to rest easy in knowing that you have a plan for your family, you can feel confident in knowing that with their services, there’s no detail too small.

Estate Planning with Digital Assets

Estate Attorney

Estate planning is important for everyone. At the very least, we all need to be prepared with a will, a Power of Attorney, and a Living Will. In today’s world, it’s now important we also take into account something new: digital assets.

What are digital assets?

Digital assets are the online accounts we all have. This is not simply Facebook, Twitter, and other social media accounts. While these accounts are part of digital assets, for purposes of estate planning, the more important accounts are that that hold property. These accounts may include:

  • PayPal
  • Amazon
  • Bank accounts
  • Credit cards
  • Netflix

Many of us no longer receive paper statements from our banks or credit cards. This makes it all the more important for us to properly categorize our digital assets for estate planning. After your death, your executor or personal representative will need access to the accounts. Part of their job is to account for all of your assets. Not only do they need to know where all of your assets are, they also need to know how to access them.

We understand not wanting to provide your passwords in a will. But the location of your passwords should be noted in the will. It’s up to you to keep those passwords up to date. This will greatly help your representative determine the full value of your estate. A great way to keep these accounts secure is to use a password manager. Not only will this help after your death but it can also help you keep your passwords straight today.

Digital assets in estate planning

Just like you would update your will each time you purchase a new home, or car, or move, you should also update your digital assets in your estate plan each time you open and close an account.

This may sound tedious but it’s incredibly important. Think about what would happen if no one knew you opened a piggy bank savings account where you collected small change. Now assume you opened that account twenty years ago and you had been depositing a few dollars each month. Now assume a standard interest rate. We’re quickly talking several thousand dollars of money that is just sitting there. But no one knows about it. If your digital assets were kept up to date in your estate plan, this could have been avoided and your heirs would be grateful for the additional sum.

Technology is new and constantly evolving. But some companies are on the cutting edge of estate planning and digital assets. In fact, Google has created a way for its users to indicate what they want to have happen to their accounts in the event of their death. But most companies don’t offer this option so, until other companies follow suit, we need to work together to make sure your digital assets are known and accessible.

Discuss your options with a lawyer

Creating an estate plan is a daunting task. Adding to that is the complexity and constant changing of all of your digital assets. An estate planning lawyer Bloomington, Illinois trusts has the experience necessary to help you categorize and to help you plan your digital assets for your estate plan.

 

 

Thank you to our friends and contributors at Pioletti & Pioletti for their knowledge about estate planning.

What do I do as Executor of a Will?

Wills Attorney O’Fallon, MO

Being named the executor of an estate can be an overwhelming thought, especially if your loved one has a large or complicated estate. As an executor, it is your responsibility to oversee the estate.

What will I have to do as an executor of an estate?

You will have many tasks to complete. It can seem like too much to handle but that’s why we’re here. We’ve helped many clients just like you complete the following:

  • File a copy of the will
  • Notify creditors
  • Open an estate bank account
  • File an inventory of estate assets
  • Determine if probate is necessary
  • Maintain and secure property until it is distributed
  • Pay debts and final taxes
  • Distribute assets
  • Represent the estate in court proceedings

These tasks can quickly become overwhelming. An estate planning attorney has the experience necessary to help you with the complex tasks. In fact, they can do many of them on your behalf. For many of the steps, you’ll just need to sit down with us and go over the paperwork to sign off on it before we file it with the court.

That seems like a lot

It is. But with a wills attorney O’Fallon, MO trusts by your side, you can handle it.

When you come to us as an executor, we will sit with you to discuss the process in detail. We will make sure you are comfortable with your duties and we will make sure you know we are going to stand by your side throughout the entire process. It’s our job to make sure the process runs smoothly and no mistakes are made.

What’s the most challenging part?

That differs for every estate and executor. Some executors find the taxes to be the most challenging while others find dealing with the family to be the most challenging. Certain aspects of being an executor will be draining, like the emotion of dealing with a family who just lost a loved one.

Do I have to formally read the will?

That doesn’t happen anymore. You won’t be forced to sit in front of the beneficiaries and tell them what they were left in the will. You will tell them and you will distribute the assets to them, it’s just not as you’ve seen in the movies.

Beware that some beneficiaries get ancy and will bug you constantly about when they’re getting whatever they’re getting. There is a time for beneficiaries to be alerted to what they’re receiving but that’s after all debts have been paid. They may not be receiving as much as they anticipated so we want to make sure we’re not providing them with incorrect information.

How much does the attorney handle?

Your attorney at Legacy Law Center will handle a great deal. They know this is uncharted waters for many people and have been down this path many times and know what needs to be done at each step. They are here to guide you and direct you and answer any questions you have along the way.