The Lawyer Blogs shown below are topical articles written by attorney David L. Crockett on all of the areas of the law that he deals with. Many of these articles are based upon actual and typical situations encountered by Mr. Crockett's clients. New blogs are posted when Mr. Crockett encounters new situations that merit detailed explanations to his clients. There is practical advice and explanations that span the subjects of the probate, trust, real estate and tax laws and court procedures that frequently arise. Because Mr. Crockett is actively advising clients on (i) wills, trusts, taxes and estate planning; (ii) administration of trusts and probate estates; and (iii) litigation about estates and trusts, many of these articles cover and crossover between all three areas of practice. The articles contain information that a person forming a trust, or a trustee or an heir/beneficiary needs to be aware of. The Blogs are organized into topics listed on the left of this page. You can view the posts listed in each topic here.
The wrong kind of deed can have expensive and unintended consequences. Once the horse is out of the barn you can get back!
Real estate property ownership is legally changed by a document commonly known as a deed which is signed by the person making the ownership transfer. The deed is then recorded with the County recorder in the county where the property is located.
We recently handled an unfortunate situation where a mature man who was quite successful and had a lot of assets including several companies married a younger woman. He was only married a couple of years when he unfortunately contracted cancer which turned out to be fatal.
We handled a probate court case involving a lady named Susan who died while in the middle of a divorce. She had an expensive ocean view house and lots of valuable furniture and jewelry. At first, nobody could figure out who owned what because Sue’s husband had moved out and filed for divorce. He was claiming in the divorce proceedings that he was owed a lot of money from Sue’s estate and Sue’s divorce attorney was making counter claims back against him because of the huge and lavish debts that he ran up buying fancy clothes in Los Angeles.
Life Insurance Trusts – A Life Insurance Trust is a permanent, irrevocable trust that is established to own one or more life insurance policies that cannot be altered, amended, or revoked. When the insured named in the life insurance policy dies, the life insurance company pays the policy proceeds to the Life Insurance Trust, instead of to the estate of the insured. The Trustee of the Life Insurance Policy then distributes the proceeds to the beneficiaries of the Life Insurance Trust according to the instructions in the Declaration of Trust.
In addition to describing a trust as revocable or irrevocable, there are many types and variations of trusts, depending upon the purpose for the trust. Typical trusts are living revocable trusts to avoid probate and help save estate taxes; irrevocable life insurance trusts; irrevocable trusts to set money aside for college education; special needs trusts; generation skipping “dynasty” trusts; spendthrift trusts; Charitable remainder trusts; and Personal residence trusts; to name a few. Trusts are custom prepared to suit the situation involved.
All tax issues involving trusts that must be understood in determining what type of trust to use. Attorney David Crockett advises on all the tax questions before preparing any trust. Determine all the tax issues in advance of trust setup. The tax questions are:
Money and property placed into a properly prepared living trust before your death generally will not be subject to probate court proceedings. Probate court proceedings have mandatory attorney fees which for example on a $500,000 estate would be $11,150 and on a $1,000,000 estate would be $18,000. This is one reason for the popularity of living trusts. A living trust enables you to set and organize the scheme of distribution of your property before death and to see how well the trust and Trustee work. Generally you save a lot of probate fees by doing a trust.
Trusts Used to Control Assets – Basically, the trust document establishing the trust states who controls the trust assets (monies, accounts and properties) and gives detailed instructions on how much, when, and under what circumstances money is paid out of the trust to the beneficiaries. The Trustee of the trust administers these instructions. However, if the trust is revocable, the Trustor can make changes in these instructions and/or revoke the trust altogether to prevent the instructions from being carried out if the Trustor changes his mind. On the other hand, if a trust is irrevocable, by definition it cannot be changed and the Trustor cannot make changes, with some minor exceptions. For example, the Trustor may retain the right to replace the Trustee if he doesn’t like what the Trustee is doing. However, when the Trustor retains rights, some of the income or estate tax benefits of a trust might be lost or diminished. Crockett Law Corporation can prepare your trust to suit your desires as to who controls the trust assets.
Trusts for Special Needs – Special Needs Trusts are used to hold money and property for specific periods of time, and to pay out the money and property according to detailed written instructions. Special Needs Trusts in particular are for lifetime financial and personal care for a Beneficiary who has a disability. The concept is to have money and property available for a disabled person but completely controlled by someone else, typically known as a Third Party Trustee. If properly structured and administered, the disabled person/Beneficiary, may still keep receiving public benefits such as Supplement Security Income (SSI) and Medi-Cal. Giving an inheritance to a disabled person by trust or through probate can be disastrous if they lose their public benefits.
Trusts are used to hold money and property for specific periods of time, and to pay out the money and property according to detailed written instructions. Trusts are used to safe-keep money and property and prevent it from being paid outright to your heirs at age eighteen (18).
Probate court is generally necessary to transfer ownership of property and accounts upon someone’s demise EXCEPT for some narrow exceptions. A major exception is property held in joint tenancy ownership. Attorney David Crockett can advise clients as to whether the joint tenancy exception is available and assist in preparing necessary documentation to create joint tenancies and to transfer the property to the survivor when one of the joint tenants passes away.
Probate court is generally necessary to transfer ownership of property and accounts upon someone’s demise EXCEPT for some narrow loopholes. This loophole rises to the effect of creating a viable Probate Exemption. A major loophole is the collection or transfer of personal property by affidavit. Crockett Law Corporation can advise clients as to whether the loophole is available and assist in preparing necessary documentation.
The way it works is for the personal representative or heirs to prepare a sworn affidavit and present it to effect the transfer. Typically bank accounts are transferred this way. Some banks have their own forms and others will require you to bring them the correct form. For transfer of vehicle titles, the DMV has its own forms to fill out found on the DMV website.
Orange County Estate Planning Lawyer Blog