estate planning handouts- de pere at dawn

8/2/2019 Estate Planning Handouts- De Pere at Dawn

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ESTATE PLANNING

Estate planning is an efficient and seamless way to provide peace of mind in the event of the

unexpected tomorrow or years from now. Estate planning is especially important for parents

with young children, blended families, or those facing potentially taxable estates. In addition to

providing your loved ones with direction in the most difficult of times, estate planning is also an

effective and easy way to ensure that charitable wishes and desires are accomplished in the

future.

Charitable giving is a wonderful way to leave a legacy in the weeks, months, and even years

after a death. Whether its an upfront dollar amount, a percentage of the estate, or a fund or

endowment to benefit generations, the possibilities for charitable giving are endless. In addition

to the tax benefits that often stem from charitable giving, those who incorporate charitable giving

into their estate plans are sure to gain personal satisfaction knowing that their favorite

organizations will benefit from their generosity after they are gone. Regardless of your motives,

it is never too early to plan ahead.

Nell & Associates, S.C. would be happy to assist you in your estate planning needs. Call, email

or visit our website today for more information!

ESTATE PLANNING OVERVIEW

1. A Standard Estate Plana. Will

i. Who needs one?1. Its never a bad idea to have a will

ii. Basic Components of a Will1. Identify Beneficiaries & How Estate is Divided2. Specify ages of distribution, if applicable

a. Done through a testamentary trust in will3. Name an Executor/Personal Representativea. An executor is the individual responsible for admitting a

will to probate and overseeing estate administration process

(often along with help of attorney)

b. An executor has no legal authority while grantor (one whocreates will) is alive


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b. Durable Power of Attorney for Healthcarei. Appoints an agent to make medical decisions on your behalf

ii. Agents authority effective only after 2 physicians determine incapacityiii. Can be as specific or general as you wishiv. What happens if you dont have a healthcare POA

1. Need for guardianship can arisec. Durable Power of Attorney for Finances & Property

i. Appoints an agent to manage all things financial (i.e. investments, bankaccounts, safety deposit boxes, etc.) and real estate

ii. Can be designed to be effective immediately or effective upon incapacityiii. What happens if you dont have a financial POA

1. Need for guardianship2. Probate

a. What is it?i.

Probate is the legal process by which title to property is transferred toheirs by a court

b. Probate Assetsi. Assets held in a decedents name alone with no beneficiary or P.O.D.

designation (i.e. bank accounts only in decedents name; real estate solely

owned in decedents name or as tenants in common, etc.)

c. Non-Probate Assetsi. Assets transferred by terms of document creating non-probate status (i.e.

P.O.D. accounts; real estate held in joint tenancy with rights of

survivorship; retirement accounts with beneficiary designations; assets

held in trust, etc.)d. Admitting a Will to Probate

i. Having a will does not avoid the need for probateii. To the contrary, a will is needed to give direction to the probate court

iii. The will must be probated to be effective iv. Beneficiary designations and asset titling trump will language

e. Alternative forms of Court Administration for Probate Estates less than $50,000i. Transfer by Affidavit

ii. Summary Assignmentiii. Summary Settlement

f. Costs of Probateshould it be avoided?3. Use of Trusts in Estate Planning

a. Living Trustsi. Assets transferred to trust during life of grantor

ii. Can be revocable or irrevocable


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1. Revocable living trusts generally do not enable grantor to avoidestate taxes or income taxes

2. Irrevocable living trusts generally can reduce estate taxes andindividual income taxes (not always a good idea)

3. Assets held in living trusts avoid probateb. Testamentary Trusts

i. Funded upon death of grantor1. Common purposes are to minimize estate taxes and provide for

long-term distributions

4. Estate Tax Overviewa. Federal Estate Taxes

i. $5,120,000 estate exemption (unless Congress acts)1. Ex. $5,800,000 Gross Estate

-$5,120,000 Exemption

$680,000 Taxable Estate (55% top rate)2. It is predicted that the estate exemption for 2013 will be

$1,000,000, with any taxable estate being taxed at 55% unless

Congress acts differently

ii. The Gross Estate1. 2031 IRCthe valueof all property, real or personal, tangible

or intangible, wherever situated.

2. Includes probate and non-probate assets; 2033 IRCthe value ofall property in which the decedent had an interest at the time of his

or her death

b. Wisconsin Estate Taxesi. No estate tax, inheritance tax or tax paid by a recipient of a gift

c. Taking Advantage of the Unlimited Marital Deductioni. Unlimited marital deduction on property passing outright to citizen spouse

or certain types of trusts

1. Example:a. H&W have $3,000,000 joint estate

i. H dies with $1,500,000 gross estateii. H leaves entire estate to W

iii. Results in $0 in estate taxii. Results in $0 in estate taxes due on first death, but wastes estate tax

exemption of 1st spouse to pass


i. H dies with $1,500,000 gross estate


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ii. H leaves entire estate to Wiii. Results in $0 in estate tax on Hs deathiv. W dies later with $3,000,000 gross estatev. $3,000,000 Gross Estate

- 1,000,000 Exemption

$2,000,000 Taxable Estate (55% top rate)

iii. Estate tax exemption of 1st spouse to pass can be maximized through useof bequests which do not qualify for marital deduction (outright to

children; to credit shelter trust [surviving spouse is beneficiary but doesnt

have enough control to be owner])


i. H dies with $1,500,000 gross estateii. H leaves $1,000,000 to credit shelter trust and

$500,000 to W outrightiii. Results in $0 in estate tax on Hs deathiv. W dies later with $2,000,000 gross estate (W is not

considered to be owner of credit shelter trust)

v. $2,000,000 Gross Estate- 1,000,000 Exemption

$1,000,000 Taxable Estate (55% top rate)

5. Long-Term Care Issuesa. Medicare

i. Covers 100 days of long-term care in a skilled nursing facilityb. Medicaid

i. Deficit Reduction Act of 20051. Brought about significant changes to divestment rules

c. Paying for long-term carei. Medicaid

ii. Long-term Care Insuranceiii. Private Paylikely most common

6. Estate Planning Wrap-Upa. Proper Estate Planning will maximize bequests to family, friends, pets and

charitable organizations

b. Poor Estate Planning will maximize taxes to the state and federal government


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ESTATE PLANNING QUESTIONNAIRE

Our estate planning services are expansive and include providing wills, trusts, healthcare andfinancial powers of attorney, probate assistance, Medicaid and long-term care planning services,and guardianship services for our clients.

The following is just an example of the information we require from clients to begin the processof long-term planning.

PERSONAL AND FAMILY INFORMATION

Personal Info Husband Wife

Full Name

Other Names (maiden, alias,

nicknames)

Occupation (if retired, list formeroccupation and check box)

Date of Birth

Place of Birth

Citizenship

Social Security Number

Date and Place of Marriage

Address & Telephone Info Address Telephone Number

Home

County:

EmployerHusband

EmployerWife

Other Telephone Numbers Cellular:

Pager:

___________________

___________________

Email Address


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Send mail to: ____ Home ____ Husbands Business ____ Wifes Business

____ Other Address: _______________________________________

Name of Accountant: ________________________________________________

Name of Other Lawyer: ________________________________________________

Name of Financial Planner: ________________________________________________

Bank/Banker: ________________________________________________

What is your primary motive for considering estate planning? (select one or more)

____ Probate Avoidance ____ Guardianship for minor children

____ Business Planning ____ Other: ____________________

____ Federal Estate Planning

Husband Wife

Yes No Yes No

Any prior marriage(s)?

Any children by prior Marriage(s)?

Any children out of wedlock?

Prior military service?

Were you adopted?

Have (either of) you ever consented tothe adoption by another of any child ofyours?

Do (either of) you own real estate orpersonal property located in anotherstate?

Do you have a written maritalagreement (prenuptial or postnuptial)?If yes, please bring a copy of the document to ourinitial conference.

Have either of you ever lived in orown(ed) property in Arizona,California, Idaho, New Mexico, Texas,or Washington? (if yes, indicate whichstates)

When did you establish yourWisconsin residency?


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Do any of your children or otherbeneficiaries have disabilities?Do you have an existing trustdocument? If yes, please bring a copy of thedocument to our initial conference.Do you have long-term care insurance?

Parents

Husbands parents (indicate date of death if deceased)

Name __________________________ __________________________

Address __________________________ __________________________

__________________________ __________________________

Telephone __________________________ __________________________

Age __________________________ __________________________

Wifes parents (indicate date of death if deceased)

Name __________________________ __________________________

Address __________________________ __________________________

__________________________ __________________________

Telephone __________________________ __________________________

Age __________________________ __________________________

Children No. 1 No. 2

Full Name

Date of Birth

Marital Status

Address (if living away from home)

Telephone (if away from home)

Is this child presently supported

by you?

Yes_____ No_____ Yes_____ No_____


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Grandchildren

Name Parent Date of Birth

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

*Please attach additional pages if necessary to identify additional children or grandchildren.

Is financial support furnished or anticipated to be furnished:

to your parents? _______ Yes ______ No

to anyone besides your children? _______ Yes ______ No

GIFT HISTORY

Type of Gift Date Value

1.

2.

3.


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SCHEDULE OF ASSETS & LIABILITIES

Cash, Bank Accounts, Money Market Funds, Treasury Bills, and Certificates of Deposit

(not including IRAs and retirement plans)

Name of Institution

Type of Account(checking, savings,

CD, etc.)

How Titled?

(husband, wife, or both) Amount

Total

Mutual Funds (not including IRAs and retirement plans)

Name of Institution

How Titled?

(husband, wife, or both) Amount

Total

Stocks

Company/Fund

How Titled?

(husband, wife, or both)

No. of

SharesApproximate Value

Total


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Bonds (including U.S. Savings Bonds)

Company/Name

How Titled?


No. of

SharesApproximate Value

Total

Real Estate

Address

Owner


Type*/Year

Acquired

Approximate

Value

Present Mortg.

Balance

* R=residence S=seasonal residence or vacation home O=investment or other real estate

Business Interests

Business No. 1 Business No. 2

Name of Business

Sole proprietorship, Partnership

(general or limited), Liability

Company, or Corporation (C or Sub S)

Principal Business Activity

Percent of Ownership

Approximate Value of Your Interest


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Life Insurance Policy No. 1 Policy No. 2 Policy No. 3

Company

Policy Number

Type of Policy (whole life,variable, universal, or term)

Insured Person

Policy Owner

Beneficiary

Face Amount

Cash Value

Outstanding Loan

Annuities

No. 1 No. 2 No. 3

Company

Contract Number

Annuitant

Owner

Beneficiary

Basis (original value)

Current Value

Outstanding Loan


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Pension, Profit-Sharing and Retirement Benefits - Husband

Company

Amount Vested,

Contributed, Deferred

Estimated Income

or Lump Sum

Payment Death

Benefit

Pension

Profit-Sharing

Deferred

Compensation

Self-Employment

Retirement Plans,

IRAs

Social Security

401ks

Pension, Profit-Sharing and Retirement Benefits - Wife

Company

Amount Vested,

Contributed, Deferred

Estimated Income

or Lump Sum

Payment Death

Benefit

Pension

Profit-Sharing

Deferred

Compensation

Self-Employment

Retirement Plans,

IRAs

Social Security

401ks


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Personal Effects

Asset Owner Estimated Value

Automobiles

Boats

Motorcycles

Household Furnishings

Jewelry

Antiques/Collectibles

Others

Total

Liabilities

Type Approximate Amount

Bills, Charge Cards, etc.

Bank Loans (not including mortgages on real estate previously

listed)

Other Liabilities

Total

Are either of you the guarantor of any loans of another? _____ Yes _____ No


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APPOINTMENTS

Personal RepresentativeThe will should name a personal representative to probate the estate. (Personal Representative is alsosometimes referred to as executor or administrator). Most people name their spouse as primary personalrepresentative, with a child, relative, friend, etc. as an alternate.

Name Address

Personal Representative

Alternate

Second Alternate

TrusteeIf you choose to avoid probate of your estate by executing a living trust during your lifetime or if a creditshelter trust is established through your will, a successor trustee should be named. The successor trusteewould be responsible for managing assets if you, or in the case of a joint trust, neither you nor your spouse,

could not manage assets due to incompetency. The successor trustee would distribute assets to beneficiariesafter death, as directed by the trust language.

Name Address

Successor Trustee

Alternate

Healthcare AgentWho should be named to make medical decisions on your behalf including decisions regarding medicalconsents, life support issues and nursing home admission if you were unable to make these decisions yourself?(Typically, the primary agent is your spouse). It is not necessary to appoint the same person who is your

successor trustee or personal representative as your healthcare agent(s).Name & Date of Birth Address

Healthcare Agent

Alternate

Second Alternate

Durable Power of AttorneyWho should be named to make financial decisions on your behalf, including bank accounts, investments, realestate transfers, etc.? (Typically, the primary agent is your spouse). I do not advise that you appoint a secondalternate agent for this position because it then gives too many people too many rights to your financialaccounts.

Name Address

Primary Agent


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PLEASE COMPLETE THIS SECTION ONLY IF YOU HAVE MINOR BENEFICIARIES OR

BENEFICIARIES WITH DISABLITIES

GuardianIf you have minor children or an emancipated child, you will need to appoint a guardian. The guardian isresponsible for the day-to-day care of the child. It is a good idea to name an alternate guardian in the event

your first choice cannot serve.Name Address

Primary Guardian

Alternate

Testamentary TrusteeYou may need a trustee to manage assets for children until they reach an age when you believe they should becapable ofmanaging property on their own. A trustee can keep the childrens money invested wisely and useit for their education, support, etc., until they reach the age specified for outright distribution of assets to them.The trustee can be a relative, friend, trust company or other person you trust to manage and distribute assets

according to your wishes. The testamentary trustee can be the same person named as the guardian, or could bea different person.

Name Address

Testamentary Trustee

Alternate

Age of Distribution.If you do establish a trust to allow a third party to manage assets for beneficiaries, then it is necessary todecide when the beneficiaries are able to manage the assets on their own. You may consider giving eachbeneficiary his/her share at the time the beneficiary reaches a particular age. You can also split the

distribution, such as at age 25 and the balance at age 30, or 1/3 at 21, 1/3 at 25, and 1/3 at 35. You mayuse any age or combination of ages.

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