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    Monthly Archives: August 2012

    Now is the Best Time to Address Hard Questions

    it's time to be an adult when it comes to talking to your kids about your
    late-in-life planning.

    At the core of proper planning is the understanding that there’s simply
    no time like the present; it’s the only time to ensure the future, to make your
    intentions known. Proper estate planning means doing just that.

    The importance of the present
    was the topic of a recent Wall Street Journal
    article, aptly titled, “Speak for Yourself, While You Can.”

    What are some of the most
    important issues to discuss? Start by communicating our wishes about health
    care, end-of-life choices, and funeral preferences. Be sure to address your
    finances, any plans you have made to finance long-term nursing care (like
    insurance policies, etc.), and what to do about the family home.

    Despite our natural reluctance
    to talk about these matters, now is simply the best time to actually lay out
    your plans and discuss them with your family. Open communication and your personal
    guidance can often avoid future family squabbles.

    So what is so important, both to
    you and your family, that it simply cannot wait?

    Contact Meier Law Firm to discuss all of your estate planning needs.

    Reference: The Wall Street
    (August 11, 2012) “Speak
    for Yourself, While You Can

    Important Reasons to Review Your Estate Plan

    Nearly 2.5
    million Americans die each year, and many haven’t signed the basic documents
    needed to protect loved ones. But let’s say you took this important step. How
    often do you need to revisit your estate plan?

    planning is not a single event, but rather a lifetime process. As long as
    you’re living, your life, your interests, and your plans are changing, growing,
    and adapting; you simply need to keep the paperwork current.

    It’s a good
    idea to review your estate planning at regular intervals. But there also are
    certain life events that could trigger the need for review and updates. Forbes points out three of them in their
    recent article, “When Should You Redo Your Will? The top
    three events listed in this article include changes in the law, impending good
    fortune, and financial setbacks.

    you really need to adjust your estate plans whenever your life or finances
    change. Another recent Forbes article
    offers the “5 Life Events That Require An Estate
    Planning Review

    Their handy checklist says you
    should review your estate plan when:

    1. You get married.
    2. You get divorced, or your spouse dies.
    3. You purchase or refinance a home.
    4. You open new savings, bank, or investment accounts.
    5. You have new children or grandchildren.

    Contact Meier Law Firm to discuss all of your estate planning needs.

    Reference: Forbes
    (August 9, 2012) “When Should You Redo Your Will?

    (August 13, 2012) “5 Life Events That Require An Estate
    Planning Review

    Travel Trusts Bestow Legacy of Experiences

    it’s trying to make sure that their children stay in touch despite geographical
    distances or wanting them to become acquainted with family roots in another
    country, some people are deciding that travel should be a part of their legacy.

    The inheritance you leave to
    your loved ones may include many things, but what if you could leave a legacy
    of experiences for your loved ones? According to a recent article in the Philadelphia Inquirer, more and more
    people are setting up Travel Trusts to
    ensure their loved ones enjoy travel-related experiences.

    True to its name, a Travel Trust is a specialized trust
    designed to do one thing and one thing only: give your beneficiaries the chance
    to travel as you always wanted them to. The terms can be broad or specific, but
    the main idea is to limit the use of the trust funds for travel—making sure
    the money is not spent on purchasing a new car, etc. This can be a powerful way
    for families to keep traditions alive, and even ensure for the possibility of
    specific religious trips, when financial concerns or hectic daily life could
    otherwise let them slide.

    One advantage of Travel Trusts is that they can be
    established with relatively small sums of money. The Philadelphia Inquirer article refers to an instance involving a
    mere $6,000. This may be an option to consider, especially if your estate is relatively
    small and you have a specific travel experience you would like to bestow on
    your heirs. As with all trusts, Travel Trusts
    can vary greatly but however structured, they surely are unique gifts for your
    loved ones.

    Contact Meier Law Firm to discuss all of your estate planning needs.

    Reference: Philadelphia
    (August 20, 2012) “Inheritance travel: Trusts can fund trips
    for heirs

    Reporting a Gift or Inheritance from Foreign Sources: The IRS Wants to Know!

    about foreign gifts and inheritances? These rules aren’t as well publicized but
    the stakes are huge.

    Have you received a gift or
    inheritance from a loved one living in a different country? The IRS wants to
    know about it, and failing to notify them could cost you. As pointed out in an
    article at Forbes, “Beware IRS Reporting Of Foreign Gifts Too,”
    you will need to file an IRS Form 3520, Annual
    Return to Report Transactions with Foreign Trusts and Receipt of Certain
    Foreign Gifts
    , if you receive:

    More than $100,000
    from a nonresident alien individual or a foreign estate (including foreign
    persons related to that nonresident alien individual or foreign estate) that
    you treated as gifts or bequests; or

    More than $14,375 from
    foreign corporations or foreign partnerships (including foreign persons related
    to such foreign corporations or foreign partnerships) that you treated as

    You are required to report these
    bequests on Form 3520 when you actually or constructively receive them. Late
    reporting penalties are high – five percent of the gift’s value for each month
    the gift is not reported, up to 25 percent of the total value.

    Remember that income from abroad
    is taxable, and the IRS is looking at foreign accounts ever more closely under
    the Foreign
    Account Tax Compliance Act
    (FATCA). To learn more, read the Forbes article, “How
    to Report Foreign Gifts and Bequests to IRS
    .” Better yet, consult with Meier Law Firm for counsel on your individual circumstance.

    Reference: Forbes
    (August 13, 2012) “Beware IRS Reporting Of Foreign Gifts Too

    Maximizing Estate Tax Savings with SLATs

    Spousal Lifetime Access Trusts (SLATs) allow you and your spouse to use
    your full remaining gift tax exemptions while retaining access to the gifted
    property in the event you need it.

    The more complex your goals, the
    more crucial the timing. This is especially true if you want to maximize your
    estate tax savings under the current $5.12 million estate and gift tax
    exemption set to expire at the end of 2012.

    So, how can spouses maximize
    their giveaways and still retain some takeaways when it comes to their wealth? Forbes recently considered this question
    in an article titled “Spousal Lifetime Access TrustsUse Your
    Gift Tax Exemption Without Giving It All Away
    .” The answer: a Spousal
    Lifetime Access Trust—SLAT.

    Essentially, with the SLAT
    approach, each spouse can give their respective $5.12 million exemption amounts
    into separate irrevocable trusts. But each spouse also names the other as
    the SLAT beneficiary and other loved ones (their children, commonly) as
    secondary beneficiaries.

    There are some very important
    steps required for a SLAT to pass IRS muster, to include avoiding application
    of the dreaded “reciprocal trust doctrine.” Do not undertake any estate
    planning without the advice of competent legal counsel.

    Contact Meier Law Firm to discuss how you can incorporate a SLAT into your estate planning.

    Reference: Forbes (August
    9, 2012) “Spousal Lifetime Access Trusts–Use Your
    Gift Tax Exemption Without Giving It All Away

    Gift Tax Exclusion Fundamentals

    You can give away as much as $13,000 during the year to anyone you
    want—and to as many people as you choose—without any tax considerations. These
    gifts can be to family members, friends or even complete strangers.

    Gifts are thought to be simple. But
    if you are serious about making savvy wealth transfers to loved ones, then the
    annual gift tax exclusion is an important tool.

    For some straight answers on
    gifts and gift taxes, The Wall Street
    recently examined the “Basics of the Gift-Tax Exclusion.”

    While the original article
    doesn’t offer exhaustive advice, it provides practical pointers you can use.
    After all, anything related to tax planning can have hidden complexities.

    Once you conquer the basics and
    have a long-range plan in play, a gifting program can be one of the most
    powerful, reliable, and comparatively simple wealth transfer strategies.

    Contact Meier Law Firm to discuss how you can implement gifting into your estate planning.

    Reference: The Wall
    Street Journal
    (August 4, 2012) “Basics of the Gift-Tax Exclusion.”

    Another Unsuccessful DIY Estate Plan Goes Awry

    Beastie Boy Adam “MCA” Yauch, who died on May 4 of cancer, left instructions
    that his music couldn’t be used in advertising. But this wording in his will,
    which he added by hand, may not even be valid. If his heirs try to honor it or
    enforce it, they could get stuck in months–or years–of legal tangles.

    It’s not always best to learn
    estate planning from celebrities. But their high visibility failures can
    be instructive. Consider the recent passing of Adam Yauch of Beastie Boys fame.

    Forbes recently analyzed Mr. Yauch's will in an article
    titled “Part Of Beastie Boy Adam Yauch's Will,
    Banning Use Of Music In Ads, May Not Be Valid
    .” It seems one of his
    last decisions and a last act of defiance was to make pen-and-ink revisions
    within a common legal provision. Unfortunately for Mr. Yauch, the language he
    chose and the addition itself did not work.

    So, what went wrong?

    The will already specified
    that Mr. Yauch’s image and name aren’t to be used for any advertising purposes,
    but then he penciled in “or any
    music or any artistic property created by me.” Unfortunately the music
    of the Beastie Boys doesn’t belong to Yauch in the same way his image does, it
    also belongs to the other Beastie Boys. Bottom line: Mr. Yauch injected a
    provision related to copyrights into a statement about publicity rights.

    For a complete analysis of that mistake, the
    original article is an interesting read. In the end, while you may be able to
    stain your deck without jeopardizing your estate, making DIY pen-and-ink
    changes should be left to professionals.

    Contact Meier Law Firm to discuss how we can help you plan your estate.

    ReferenceForbes (August 13, 2012) “Part Of Beastie Boy Adam Yauch's Will,
    Banning Use Of Music In Ads, May Not Be Valid

    Have You Protected Your “Virtual” Property?

    Estate planners say few, if any, of their clients consider digital
    assets in their wills—an oversight that can result in real-world losses to
    beneficiaries. And experts say the estate-planning industry itself has been
    slow to adopt standards for dealing with the sort of "property" that
    may exist only in cyberspace.

    The digital revolution has meant
    that we don’t live like we used to – most of us can’t live outside of a Wi-Fi
    hotspot, 4G network, or computer screen for longer than a couple hours. So how
    could we possibly plan for our estate today, as they used to before everything
    became virtual?

    Dealing with digital assets can
    be a tricky business, often in ways that aren’t readily apparent. Nevertheless,
    digital assets are both vital and newsworthy topics for estate planning. For
    example, consider an article by SmartMoney
    titled “Protecting You Virtual Estate” and
    the similar article by The Wall Street
    titled “With Estate Planning, Don’t Forget Virtual
    .” Both are worthy of your

    Digital assets can range from
    personal data held in social websites to intellectual property, or even domain
    names. Then again and more importantly, a growing majority of people do their
    banking, investing, and tax-paying online. Is this starting to hit closer to
    home now?

    Some aspects of our digital
    lives simply need real world planning, especially because few states have laws
    in place to account for the postmortem transfer of digital assets. Even if
    you’re not a tech guru with websites and special online projects, you wouldn’t
    want valuable information to be lost to your heirs.

    If you have a digital presence,
    then you must plan accordingly.

    Contact Meier Law Firm to learn how you can protect all of your assets, including your digital ones.


    (July 25, 2012), “Protecting You Virtual Estate

    Wall Street Journal
    (July 28, 2012) “With Estate Planning, Don’t Forget Virtual

    Medicare Premiums Expected to Hold Steady in 2013

    Medicare beneficiaries will pay the same premium for prescription drugs
    next year as they did this year, the U.S. Department of Health and Human
    Services said.

    Finally, a little good financial
    news for seniors – your 2013 Medicare premiums are projected to remain the

    That’s right, the Department of
    Health and Human Services issued its estimate not long ago, and Businessweek reported it in an article
    titled “Medicare Drug Plan Premiums to Stay at $30
    in Coming Year
    .” Indeed, according to the estimate and bids from
    private insurers, the premiums for Medicare drug plans are expected to hold
    steady at the $30 average where they stand today.

    While this is welcome news in
    trying times, we can only hope that the estimate stands the test of 2013 and
    the current political posturings. For that matter, keep Medicare in mind as we
    glide to the annual enrollment period that begins October 15.

    Reference: Businessweek
    (August 6, 2012) “Medicare Drug Plan Premiums to Stay at $30
    in Coming Year

    Estate Planning Questions to Make You Squirm

    To help implement your wishes, trusts and estate lawyers need to ask very tough questions. Some of them might make you squirm.

    Have you made (or updated) your estate plan? What questions about your estate planning (or lack thereof) are most likely to make you squirm?

    A recent article in Forbes tackled this question. The article, titled 12 Estate Planning Questions That Might Make You Squirm, offered 12 questions to ask yourself.

    Here they are:

    1. Who will raise your children if both parents die?
    2. What if you all die in a common disaster?
    3. Are there any other descendants you haven’t yet mentioned?
    4. Have you told me about all the important relationships in your life?
    5. Do you have any genetic material on ice?
    6. Are you transgender?
    7. Have you ever made large gifts to others?
    8. Who is going to take care of your pets?
    9. When do you want the plug pulled?
    10. What are your passwords, usernames and security questions?
    11. Did you enter into a prenuptial or postnuptial agreement or did you sign a community property agreement?
    12. Have you had any serious or chronic health issues?

    Admittedly, this is an interesting array of questions and not all of these questions may apply to you. But the point is to make a sober self-assessment of your current estate planning goals against the backdrop of the planning you have made (or would like to make). An experienced estate planning attorney can help you through this process, and perhaps even reveal some “blind spots” of which you were unaware.

    Contact Meier Law Firm to discuss your estate planning questions.

    Reference: Forbes (July 24, 2012) “12 Estate Planning Questions That Might Make You Squirm

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