In 2018, around 7.5 million second homes existed, which is about 5.5% of all homes. These homes are important because they hold cherished memories for you and your family. To make sure that these memories and your property are protected, it’s crucial to consider the following points about estate planning.

Estate Planning for Vacation Property: Ownership and Inheritance

If you own a vacation property, what happens to it when you pass away depends on how it’s currently owned. If you are the owner or co-own it with others, you need to decide what happens to your interest in the property. If you co-own it with someone else and you have joint tenancy or own it with your spouse, your interest will automatically transfer to the remaining owner without court involvement.

If a trust or limited liability company owns your vacation property, it will still own the property after you pass away. The trust or operating agreement may have instructions on what will happen to the property at that time.

Estate Planning for Property Owners: Ensuring Your Wishes Are Honored

Creating an estate plan allows you to make decisions about what happens to your money and property in a legally binding way. If you don’t have a plan and your property isn’t owned jointly, your state will decide what happens to it and your loved ones will have to go through the court-supervised probate process. If you own property in a different state, your loved ones may need to open two probate cases. There are different ways to handle your vacation property, so it’s important to consider your options.

• Give the property outright to a loved one

• Leave the property outright to a group of people

• Give the property to a group of people as tenants in common and create an ownership agreement

• Prior to your death, transfer the property to your revocable living trust to be held for a long period of time or indefinitely

• Prior to your death, transfer the property to a special trust that owns only the property to be held for a long period of time or indefinitely

• Prior to your death, transfer the property to a limited liability company to be held for a long period of time or indefinitely

• Instruct your trusted decision maker who will wind up your affairs to sell the property.

Is Your Beneficiary Prepared to Take Over Your Vacation Property?

Your vacation property comes with happy memories, but also with a lot of responsibilities. If you decide to leave the property to someone after you pass away, they will have to take on financial responsibilities like mortgage payments, utility bills, and property insurance and taxes. If you want your beneficiary to keep the property, you need to think about whether they can handle these responsibilities. If not, they may be forced to sell it early.

Owning property with your children may also seem like a good idea, but there is a possibility that they may not get along in the future. This means they need to work together to maintain the property by communicating, agreeing, and contributing equally. An estate plan can help prevent problems by outlining a plan that everyone agrees to follow.

Estate Planning: Turning Your Wishes into Reality

To ensure that your wishes are followed and that your loved ones are prepared to maintain the property, there are several steps you can take.

First, you need to legally document your wishes and plan for any possible scenarios.

Second, if you are concerned about your beneficiaries being able to afford the property’s upkeep, you should consult with a financial advisor to create a plan that includes setting aside money for maintenance. Additionally, you should speak with an insurance agent to make sure the property is properly insured and consider acquiring life insurance to provide additional financial support.

Lastly, meet with a tax adviser to understand any potential tax implications of transferring the property during your lifetime or after your death.

If you want to know more about how to safeguard your vacation property and ensure that your desires for it are implemented, please get in touch with us.

It’s important to plan ahead for your death, even if it’s a long time away. You can create a plan with the help of an exprienced estate planning attorney. This plan will be legally binding and will decide who will manage your finances or medical care if you can’t, who will take care of your kids, who will take care of your property after you die, and who will inherit your assets and artworks.

You have various options regarding who will receive your artwork. You could:

• Instruct your personal representative, executor, or successor trustee to sell any of your artwork in your possession at your death;

• Designate specific individuals to receive it;

• Have it held by a trust or foundation to be lent or licensed after your death; or

• Provide instructions to donate your work outright to a museum, university, or other organization that might benefit from it.

The First Steps to Take

You should create a record of all the artwork you own, including pieces you have sold, lent, licensed, gifted, donated, or kept. For pieces you have sold, include the buyer’s name and how much you sold it for. Make sure to include pieces that you have lent, as your loved ones will need to know who has them and when they need to be returned. Also include pieces you have licensed to someone else, as this will be a source of income for your loved ones after you’re gone. Finally, include any pieces you have gifted or donated to charities. Be sure to also include any pieces you have kept for yourself.

Once you have made a list of the artwork you own, it is important to work out what each piece is worth if it has not been evaluated or given away or sold. This will help you understand how much your artwork is worth in total and if you have enough insurance to cover its value. Your artwork can be stolen or damaged like other possessions, so it is important to make sure it is protected.

The last step is for you to meet with an exprienced estate planning attorney. Schedule a meeting with us. During this meeting, we will talk about who you want to be in charge of your affairs after you die and if you ever become unable to make decisions for yourself. We’ll also talk about what you want to happen to your art, music, or other creative works after you die. We’ll listen to your worries, goals, and dreams so we can create a plan that is tailored to you.

Include the Copyright in Your Plan

A copyright protects the original creations of an author, such as books, movies, songs, computer software, photographs, and architectural works. These works can be protected even if they are not published, but they are likely to be more valuable commercially if they are. When making an estate plan, it’s important to remember to include the copyright of your artwork. If you don’t specify who gets the copyright in your will or trust, it will go to your heirs as part of the residuary clause which distributes any property that wasn’t already given away. This means that one person could end up with the work and another with the copyright.

However, it is important to note that a copyright includes your right to terminate most transfers or licenses of the copyright at a future date. This right cannot be given away or taken away during your lifetime. After you die, the right will go to your spouse and children. This includes the right to end a transfer of a copyright to a trust. The only exception to this rule is a transfer of the copyright by a will, which cannot be terminated by your spouse and children.

We Are Here to Help You and Your Legacy

It can be difficult to know what to do with your treasured artwork. We understand how stressful this can be, so we want to help you create a suitable estate plan. Get in touch with us to set up a consultation.

The purpose of estate planning is to safeguard you and your loved ones. When there is a loved one who may need additional support after your death, this can be a challenging task. You may wish to give this person as much as possible, but you may not wish to do so at the price of others you care about. A right of occupation trust can help you arrange for this circumstance in terms of property ownership and use.

What is a right of occupancy trust?

Through a right of occupancy trust, you can give someone the right to live at your home or another real estate until they die or move out, or for a certain amount of time.

This may be implemented by providing a provision in either a last will and testament or a trust agreement, which places the real property into a separate subtrust overseen by the trustee designated by the grantor. This provision will allocate money to the subtrust in order to cover the property’s maintenance expenses and will include instructions outlining the beneficiary’s rights and responsibilities, as well as the trustee’s responsibilities on the trust’s behalf.

Additionally, the trust instrument will direct what happens to the property once the beneficiary passes away, which may include keeping the property in the trust for another beneficiary, giving it outright to a beneficiary, or selling the property and holding the money in trust for someone’s benefit or distributing it outright to a chosen beneficiary. It is important to note that selling the property can have adverse impacts on homestead status, and the trustee should get legal advice before selling.

Important questions to ask yourself

Considering these questions is essential for successful implementation of this strategy, as it ensures that your instructions are concise:

• Is the tangible personal property, such as furniture and appliances, included with the property?
• Would you like to allocate funds for administrative costs, state and local taxes or assessments, utilities, property insurance, and mortgage payments, or will the beneficiary be responsible for these expenses?
• If the property includes a residence, does the beneficiary have to live there full-time? Are they permitted to allow a subsequent spouse, friend, or companion to reside at the residence?
• Does life changes, like remarriage or admission to a long-term care facility, terminate the right of the beneficiary to stay at the residence?

Is a Right of Occupancy Trust an appropriate solution for you?

If you have a home solely in your name and wish to guarantee your surviving spouse a place to live without risking disinheriting any children from a prior relationship, this approach can provide security for all involved.

If you desire to keep the property within your family’s bloodline by allowing your surviving spouse to use the asset for their lifetime, while ultimately passing ownership to your children, a right of occupancy trust can help to fulfill this goal.

If you have a loved one who is dependent on you and you want to ensure that they have a place to live after your passing, a right of occupancy trust can provide that security for your loved one while also protecting the home for the benefit of other loved ones in the future.

Creating a support team to setup a right of occupancy trust

It is important to involve your team in order to guarantee the realization of your wishes. To do this, a financial advisor should be consulted in order to assess your current financial assets and determine what steps should be taken to guarantee the availability of funds for property maintenance, should the trust be responsible for covering most of the expenses.

An insurance agent should also be consulted to ensure that the residence is correctly insured under all the different ownerships (yours, the right of occupancy trust’s, and the ultimate recipient’s, whether a remainder beneficiary or another trust). Additionally, the insurance agent can offer advice regarding life insurance options should you lack the financial resources or cash assets to provide the necessary funds to maintain the residence.

A tax advisor should be consulted to discuss important tax implications of a right of occupancy trust and to answer these important questions:

• Will your beneficiary be allowed to take any income tax deductions with respect to the property?

• Will the property qualify for any applicable property tax exemptions that may currently be lowering the property tax bill?

• Will the property tax be uncapped at any point during the funding or trust administration?

We can also help you in determining your preferences for handling your assets and providing for your family. Afterwards, we can guarantee that your wishes are lawfully binding and will be followed through after your death, providing you with the assurance that everything will go as planned and your family will be taken care of.

Contact us to set up a consultation if you’re curious about right of occupancy trusts or any of the various ways we may personalize an estate plan to safeguard you and your loved ones.

Approximately 2% of all babies born in the United States in 2019 (83,946) were conceived using assisted reproductive technology, according to data from the Centers for Disease Control and Prevention (CDC).

The CDC defines ART as all fertility treatments involving the manipulation of both eggs and embryos. It can involve numerous procedures, with artificial insemination, in vitro fertilization (IVF), and cryopreservation being the most well-known (genetic material frozen for later use). Surrogacy is a related arrangement in which a woman other than the one who will assume the role of mother carries and delivers a child. A surrogate may utilize the surrogate’s egg and the father’s sperm or carry an embryo implanted via in vitro fertilization that contains genetic material from one or both of the intended parents.

ART can help those who are struggling with infertility, want to avoid passing on genetic risks, or want to store genetic material for future use, as well as same-sex couples who wish to have children. Surprisingly, ART can have a significant impact on the estate planning of families who use it to have children.

Wills and Living Revocable Trusts

Due to the unique issues surrounding ART, it is essential to include children who may be born using ART in your will or revocable living trust when you create or revise it.

What about children conceived following a parent’s death? There have been laws that allow children conceived before the death of one parent, but born after, to inherit from the deceased parent in the same manner as children born to the deceased parent before death. ART has made it possible for children to not only be born after the death of a parent, but also to be conceived using techniques such as in-vitro fertilization or artificial insemination.

It is essential to meet with an experienced estate planning attorney in your state to ensure that your estate plan will achieve your goals, as the laws governing ART vary widely from state to state. Some states consider posthumously conceived children to be heirs of the deceased parent if they were conceived within 36 months of the parent’s death and the deceased parent left a signed document or other clear and convincing evidence indicating an intent for the child or children to be considered their heir.

Other states require that the child be born within two years of the parent’s death, while others require written consent signed by the deceased parent and maintained by the licensed assisting physician indicating the deceased individual’s intent to be the child’s parent.

Due to these stringent requirements, a parent who fails to create a comprehensive estate plan may unintentionally disinherit their own child. Those who use ART or may use it in the future must therefore include posthumously conceived children in their estate plan. In addition, it is crucial that grandparents include posthumously conceived children in their estate planning documents.

Moreover, even if ART is not currently a consideration, trust creators should remember that estate planning documents should account for future generations of the family, especially for multigenerational trusts. All family members who are intended to benefit from the trust, including any posthumously conceived children, should be specified explicitly in the trust document.

What if the child is born many years after the death of the parent? It is important to remember that a child conceived after a parent’s death could be born many years later. This could cause confusion in the administration of a trust or estate. For instance, a deceased parent may leave a bequest to all of their children, including those conceived after death.

What happens, however, if the posthumously conceived child is born years after the personal representative distributes the gifts to the living children? To provide for the posthumously conceived child, would the personal representative need to reacquire a portion of the gifts from the children? To address this potential issue, a time limit should be established within which a posthumously conceived child must be conceived or born in order to inherit money or property, even if such a child is specifically named in a will or trust.

Are survivor benefits from Social Security available to the child? In the 2012 case Astrue v. Capato, the Supreme Court of the United States ruled that a child conceived after the death of his or her biological father is only eligible for Social Security dependent benefits if the child was entitled to inherit from his biological father under state law. As previously mentioned, state law varies widely; therefore, it is crucial that those who may become parents of posthumously conceived children express their intent that those children inherit from them in carefully drafted estate planning documents, and comply with any other state law requirements, such as providing written documentation of the parent’s intention to be maintained by the assisting physician.

Surrogacy

Different states have different laws regarding surrogacy. A few states prohibit surrogacy, but the majority permit it. Some state laws, where allowed, require the intended parents to have wills naming a guardian for their minor children in order to finalize a surrogacy agreement. In situations involving surrogacy, it is essential to complete all required procedures to establish legal parentage, as some states permit prebirth orders while others require adoption proceedings after the birth of the child.

Gifts of Genetic Material

People who decide to use assisted reproductive technology (ART) should enter into a well-drafted written agreement (not just a standard form provided by the medical facility) that specifies who will have custody and control of the genetic material in the event of death, divorce, or other unforeseen circumstances.

Those who opt for cryopreservation may wish to leave their genetic material to a spouse or partner if they pass away before the material is utilized. In addition, as previously mentioned, if the material is intended to be used for posthumous conception, it is crucial that parents express their intention to provide for posthumous children. It may be prudent to set aside funds to cover the cost of storing genetic material during the estate administration process or to specify trust distributions for this purpose.

If you are considering assisted reproductive technology (ART), you may want to include a statement in your living will and power of attorney expressing your intent and instructions regarding the extraction and use of genetic material for conception while you are alive, in case you are unable to express your wishes due to illness or unconsciousness.

ART has been a life-altering solution for many families struggling with infertility or other childbearing obstacles. We can assist you in ensuring that ART-conceived children have a secure financial future. We can also help you decide whether or not to donate your unused genetic material after your death.

Call us today to schedule an appointment so we can design the best estate plan for you and your kids. If you prefer, we can meet with you virtually or over the phone.

The birth of a child is a significant event in every parent’s life, particularly if they have utilized assisted reproductive technology (ART). Using ART necessitates comprehensive financial and estate plans that are uniquely tailored to the needs of your family.

As you continue your journey, we’d like to answer some of the most frequently asked questions about planning for your family.

When should I begin making plans for my child?

Now is a good time from a financial standpoint to begin planning for your child. As you probably already know, the ART process can be costly. Having a proper financial plan can help alleviate some of your concerns throughout the process. Consideration must be given to the cost of food, clothing, shelter, toys, and education when raising a child. Even if you are not expecting a child in the near future, saving money or preparing a budget to cover these costs can put you on the right financial path.

You can create an estate plan for a potential child now and modify it after the birth of a child. Developing an estate plan is not a one-time occurrence. It must adapt to your and your family’s changing circumstances.

What will become of my genetic material after my death?

You or your spouse or partner may store genetic material (e.g., sperm, eggs, embryos) for future use as part of assisted reproductive technology (ART). It is crucial that you review the forms you signed with your doctor or the facility to determine what will happen to genetic material in the event of your death or that of your spouse or partner. Typical options include destroying, donating, and transferring ownership to a named recipient. In many states, courts defer to the contents of the form. Before signing, it is crucial that you understand what it says and agree with the outcome. Additionally, you must know what to do if you change your mind.

What happens if a child is born after the death of a genetic parent? Can the child inherit from the parent who has died?

Do I really need the assistance of an attorney for estate planning?

While the do-it-yourself options may appear to be less expensive and more convenient than working with an attorney, only an experienced estate planning attorney can ensure that your estate plan is tailored to your specific circumstances. Customized language, as opposed to standard definitions for terms, can reduce confusion regarding who and how you want to receive your money and property.

Although the terms parent and child have commonly understood standard definitions, they may have different meanings in your family. For instance, does the term parent refer to a parent’s biological parent, gestational parent, adopted parent, or spouse? Assuming that a parent is the source of genetic material may cause you to overlook an important individual.

Similarly, the term child may have different meanings depending on the context. Does the term child include biological, adopted, and stepchildren? You may consider someone to be your child, but you must ensure that the individual is properly identified as your child in all legal documents.

Lastly, as ART becomes more prevalent, the definition of the term “descendants” may be affected, not only in your plan but also for other members of your family. Do you want your child’s child conceived through assisted reproductive technology to be considered your grandchild, even if there is no genetic link?

We recognize that your path to parenthood may be arduous and filled with ups and downs. We respect your privacy and strive to create a plan that expresses your wishes in a way that is legally enforceable, protects you and your family, and prevents family conflict. Call us to schedule an appointment where we can tailor a plan to your specific requirements.

In the context of estate planning, the term “probate” frequently carries a negative connotation. In fact, financial planners advise many individuals, particularly those with valuable accounts and property, to try to avoid probate whenever possible.

However, the purpose of the probate system is ultimately to protect the deceased’s accounts and property, as well as their family, and in some instances it may even be advantageous. Consider briefly the advantages and disadvantages of probate.

The Pros

In certain instances, particularly when there is no will, the system ensures that all accounts and property are distributed in accordance with state law. Here are some potential benefits of involving the probate court in the administration of a deceased person’s estate:

1. It provides a reliable procedure for the distribution of the deceased person’s property in the absence of a will.

2. If a will exists, it validates and enforces the wishes of the deceased.

3. It ensures that taxes and valid debts are paid so that the beneficiaries are not left with an uncertain feeling regarding the decedent’s affairs.

4. If the deceased had debts or unpaid bills, probate provides a method for limiting the amount of time creditors have to file claims, which may result in debt discharge, reduction, or other advantageous settlement.

5. Probate can be advantageous for the distribution of smaller estates where estate planning would have been too expensive.

6. It allows for third-party oversight by a respected authority figure (judge or clerk), potentially reducing family conflicts and aiding in ensuring everyone’s best behavior.

The Cons

Although probate is intended to facilitate the transfer of accounts and property after a person’s death in a fair manner, consider bypassing the process for the following reasons:

1. Generally speaking, probate is a matter of public record, meaning that certain documents, including personal family and financial information, become accessible to the public.

2. There may be substantial costs, such as court fees, attorney’s fees, and executor fees, which are deducted from the value of the assets you intended to leave to your loved ones.

3. Probate can be time-consuming, delaying the inheritance of your beneficiaries for months or even years.

4. The probate process can be difficult and stressful for the executor and beneficiaries.

The Bottom Line

Probate is a default mechanism that ultimately enforces fair distribution of even small amounts of money and property, but it can be costly and time-consuming. For this reason, many individuals prefer to use strategies to avoid probate when they pass away.

A skilled estate planning attorney can devise a plan to help you avoid probate and make life easier for your heirs. Contact us today to schedule a consultation and receive more information about your options.

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