In November 2020, California voters approved Proposition 19. This new law dramatically changes the property tax rules when property is inherited by a child from a parent (or, in certain circumstances, when property is inherited by a grandchild from a grandparent). It also expands the ability of certain homeowners to keep their property tax base when they move to a new home within California.
Caught in the Undertow: How No Estate Plan (or a Bad One) Could Leave Your Family Overwhelmed
Many people love to visit the beach during summer vacation, enjoying the ocean and sunshine. But there may be unseen dangers that are crucial for beachgoers to keep in mind: For example, a rip current, sometimes called an undertow, is a current of water, often quite powerful, below the surface, that is moving away from shore when waves are approaching it. It can easily knock a smaller person off balance and could be dangerous for those who are not strong swimmers. It is very important to take steps to protect family members from this danger.
Caregivers, You're Not Just Planning for Yourself
As a caregiver, you spend much of your time, money, and energy taking care of the needs of others. Those who have taken on the role of caregivers for ill or disabled spouses, aging parents, children, or other loved ones with special needs are typically selfless and giving individuals who may not stop to consider their own needs, or their own mortality. As a caregiver, it is important to not only take time to care for yourself, but also to ensure that those that rely upon you will be well taken care of if you can no longer care for them.
Beneficiary Designations DOs and DON'Ts
When working with our clients, we find that many are surprised at the importance of properly completing beneficiary designations, and most have given very little thought to them. Beneficiary designations are used to direct who is entitled to receive the proceeds from life insurance, retirement plans and pay-on-death accounts, many of which can be worth a substantial amount of money. In fact, these assets may be the largest part of your estate…
Your Estate Planning Checkup
Three Legal Strategies When Facing a Major Health Event
From facing a global pandemic, to receiving a scary health diagnosis or learning that you need to undergo major surgery, you may be overwhelmed trying to prepare. Any health event can cause substantial disruption in your day-to-day life. During this time, the last thing you may want to think about is estate planning. Although you may have many things going through your head at the moment, now is a crucial time to make sure your estate plan is in order. Proactive planning can help put your mind at ease and let you focus on your health. Let’s review your estate plan together to make sure each of the following important components is up to date and reflects your current goals and wishes.
6 Important Things Your Agent Under a Medical Power of Attorney Needs to Know
Even if you are currently the picture of good health, you may suddenly become too ill to make healthcare decisions for yourself or become unconscious after an accident, needing someone to stand in your shoes to make those decisions for you. A medical power of attorney is a crucial part of your estate plan that enables you to name a trusted person to make healthcare decisions for you, if and when needed. It is essential for the person you name to have the information necessary to carry out your wishes for your medical care.
Healthy Through the Holidays: A Guest Post by Wellness with Stef
Estate planners know that December and January are a time when we predictably see an increase in health issues and calls for emergency estate planning. We are excited to have our friend and guest blogger, Stefanie Thayer, give us some tips for maintaining our health during the holiday season. Here’s what Stef has to say about the holidays and your health:
The holidays are here! That means more fun, stress, eating, sweets and drinking! Did you know that more people have heart attacks during the holidays than any other time of year because of the factors mentioned above? So, here are some tips to keep you healthy and happy during this time of year:
Make a gratitude list. Write down three things each morning you are grateful for. When you are stressed, you can look at this list for a positive perspective.
Fill up on your vegetables first. Once you've done that, you won't be as hungry for all the other offerings, but you will still be able to enjoy them.
Drinks - rotate one drink, one water, one drink, one water. It's about enjoying yourself, not getting drunk first!
Desserts - Did you know 95% of your satisfaction comes in the first THREE bites?! So keep that in mind. Pick your favorite dessert. Savor each bite, eat it slowly. You may just find three bites does the trick.
Most of all, remember to look for the JOY in the season
Stef is the owner of Wellness with Stef, a Health Coach and Certified Sports Nutritionist. If you are interested in learning more about Stef, you can visit her online at
wellnesswithstef.com or email her at stef.thayer@yahoo.com.
Wishing all of our clients, colleagues, friends and family a happy and healthy holiday season!
3 Myths We Tell Ourselves About Estate Planning
Estate planning can be a very difficult process. While it’s not brain surgery, making the decision to move forward with the planning requires us to face the fact that we will not live forever. This thought can stop many people right in their tracks. Others talk themselves out of seeing a qualified attorney to put together an estate plan based on some of the following common myths:
Estate Planning Awareness Week: The Importance to You and Your Family of Having an Estate Plan
In 2008, Congress recognized the need for the public to understand the importance and benefits of estate planning by passing House Resolution 1499, which designated the third week of October as National Estate Planning Awareness Week. Nevertheless, according to a 2019 survey carried out by Caring.com, 57% of adults in the United States have not prepared any estate planning documents such as a will or trust, despite the fact that 76% viewed them as important. Many of the respondents said this was due to procrastination, but many others mistakenly believed that it was not necessary because they did not have many assets.
Important Considerations For Beneficiary Designations Of Life Insurance Policies
It’s Planning Season
For each season, there is planning that you must do on the farm. In order to be successful, this planning must be done thoughtfully and in advance. Your life is no different. To properly plan for the next season in your life and the lives of your family, a well-executed estate plan is a must. Below are a few documents to consider when crafting a plan to protect yourself, your family, your business, and your legacy.
Trust:
A trust is a written agreement that is funded with the assets that you own and names a trustee to oversee and administer the assets on behalf of named beneficiaries. In the beginning, you can be both the trustee and the beneficiary. One benefit of a trust is that, should you become incapacitated, the successor trustee that has already been named in the written agreement and can seamlessly step in and continue handling the financial assets owned by the trust on your behalf. Thereafter, when you pass away, the remaining assets will be allocated according to your instructions in the trust. Because the assets are deemed to be owned by the trust, and you have already determined what will happen to them, there will be no need for probate. A specifically-crafted trust has the additional benefit of protecting your assets (the farm) from the creditors of your beneficiaries.
Financial Power of Attorney:
A financial power of attorney is a written document in which you appoint a person to handle a variety of financial and property transactions on your behalf. This can include signing contracts for you, making deposits into your bank account, managing property, paying taxes, and opening new accounts for you. The specific powers given to an agent under a power of attorney will depend upon your wishes and what you list in the document itself. If your land, equipment, and associated bank accounts are in your name alone, it is incredibly important to have this document in place so someone will have the authority to maintain your business and associated transactions should you be unable to do so.
Medical Power of Attorney:
Farming can be a very strenuous and taxing career. Having a medical power of attorney in place is therefore crucial. This document allows you to name an individual to make medical decisions on your behalf in the event you are unable to do so. While this is only applicable if you are incapacitated or otherwise unable to communicate your own wishes, this document will save your family a lot of time and money by making it unnecessary for them to go to the court to have someone appointed by a judge.
We understand how important your farm and family are to you. We want to make sure that you are properly protected and that everything is in place to properly transition your farming legacy to the next generation. Give us a call to schedule an appointment so we can evaluate your unique situation and craft a plan to help ensure your legacy will be a lasting one.
Your Vacation Checklist
You’ve packed sunblock and a beach novel. You’ve planned your itinerary and bought plane tickets. But have you ensured that your estate plan is up to date? Don’t leave home without making sure your financial health and the future of your loved ones is provided for. It’s even more crucial than getting a pet sitter and locking the front door.
Legislature Proposed Estate & Gift Tax for California (SB 378)
If you are a client, you have likely heard me say it a dozen times, “we never know what the tax laws will be at the time of your death – they are changing all the time.” As it happens, a new bill has been proposed in the California Senate that would impose a California gift, estate and generation-skipping tax (GST) beginning on January 1, 2021.
How To Protect Your Retirement Account
Shocking to most people, your retirement accounts can be seized once they pass to your loved ones. During your lifetime, your retirement funds have asset protection, meaning they can’t be taken in a lawsuit. Unfortunately, as soon as retirement accounts are inherited, the protection evaporates. This means your hard earned money can legally be snatched by strangers and the courts.
Three Legal Strategies When Facing a Major Heath Event
The Differences Between a Will and a Trust
Should You Choose a Will or a Trust
A recent study states that over half of all Americans die "intestate", meaning without a will. That's not completely true – California (and most other states) has "intestate laws" defining how your property will be distributed. So, you do have a will, but not necessarily one you'd like. Either you choose how your estate is divided or the State of California will choose for you.
The choice, obviously, should be yours. That means every person should have an estate plan. Attorney Heather Johnston founded Sapphire Law Group to deliver a level of elder law and other services equal to any major firm, but in a way that is convenient, efficient and, most of all, personal.
What is a Will?
A will is a legal document that defines who (beneficiaries) receives your property (estate), and in what amounts, after you die and who's in charge of the transfer (executor). If you have minor children, it can also define who'll raise them for you (guardians). Wills can even specify funeral arrangements.
There is a legal process (probate) that certifies your will is final and binding. This, by the way, makes your will a matter of public record. If anyone doesn't like the will, they can ask the court to invalidate it (contest).
What is a Trust?
A trust (also called a "living trust") is a legal relationship defined by a document (instrument) defining how one person or business (trustee) holds and handles the property of another (donor, grantor, settler, trustor) on behalf of others (beneficiaries). In California, the trustee can be the donor and/or one of the beneficiaries or the trustor can pick a relative, a friend or a trust company to act for them.
Upon your death, the trust passes immediately to the beneficiaries without probate. Trust transfers can, therefore, remain entirely private. A trust can also deal with incapacity – assuring that your wishes are carried out even if you're still around but can't make those wishes known. A trust can't specify guardianship for children, but a trust instrument isn’t at all easy to contest.
Is a Will or Trust Better for You?
Since every individual's situation is different, every estate plan is different. Consult an experienced living trust lawyer to see exactly how best to safeguard your family and property. In Folsom, California, that living trust attorney should be Sapphire Law Group. With Sapphire as your lawyer for wills and trusts, probate, trust administration or estate planning, you get more than just the documents, you get a partner and the peace of mind your family deserves.
Estate Planning: 3 Reasons We Run the Other Way
3 Tips For Every New Homeowner
If you just purchased a new home, congratulations! Whether this is your first home or an upgrade/downsize, the purchasing of a home is a big event in your life. When these major life changes occur, it is important that you are properly prepared. Below are a few things for you to consider now that you finally have the keys to your new home!
- Update Your Address. Now that you are in your new home, it is very important that you update your address with the appropriate entities. Your local United States Postal Office will have a form you can fill out. If you cannot make it into the post office, you can also update this information on their website. This will assist them in forwarding your mail to you. To ensure that you don’t miss any important tax notices or refunds, you will also want to update this information with the Internal Revenue Service, using Form 8822, and your local state tax agency.
- Make Sure Your House Title Coordinates With Your Estate Plan. While it is still fresh in your mind, reference your new deed to see how the property is titled. Then, you will want to reference your estate planning documents to make sure that your property has been titled properly to achieve your estate planning goals. For example, if your previous plan had a specific provision distributing your old property, you will want to make sure that you update this provision since you no longer own the previous property. On the other hand, if this is your first home and your estate plan includes a trust to avoid probate, you will need to make sure that your home was titled in the name of the trust and not in your name individually.
- Check Your Life Insurance Coverage and Beneficiary Designations. Unless you were fortunate enough to pay cash for your new home, chances are you now have a large monthly mortgage expense. In order to protect your loved ones, it is important that you check your life insurance coverage. Should you die before paying off the mortgage, it is a good idea that you have enough life insurance to meet that obligation should you have a surviving spouse or children that will likely continue to reside in the home. Even if they choose to not remain in the home, the life insurance can provide valuable assets during what is usually an emotionally difficult time. This is also a great opportunity to double check your beneficiary designations. Life changes happen so quickly that sometimes this can be overlooked. If your designations do not match up with the rest of your estate plan, you may end up inadvertently disinheriting a family member or having the money fall directly into the hands of an individual without any guidance. Lastly, now that you have a home and homeowner’s insurance, call your insurance agent to make sure that you are getting all of the discounts that you are entitled to. Many insurance companies will offer discounts when you bundle services. If you already have car insurance through a carrier and use the same company for your homeowner’s insurance, you may be entitled to a better rate that if you had both policies separately. In addition, homeowners often get discounts that renters don’t.
Buying a new home is a big step and we are here to help. Give us a call and we can help make sure that your new purchase and estate planning are working together to carry out your goals.
Estate Plans for College Students and Other Young Adults: Why It’s the Perfect Time to Set Your Kids Up for Success
As graduation celebrations abound, the parents of young adults experience a mixed bag of emotions. It can be exciting to see your children branching out and becoming successful adults in their own right —a time full of hard work and self-discovery that hopefully lays the groundwork for a fulfilling career in the coming years. But, it can also be a time of anxiety for some parents. We all want to know that we are doing absolutely everything we can to make sure our kids stay safe, healthy, and secure so they can pursue their dreams to the fullest.