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    Joshua and Laura Meier Newport Beach Trust and Estate Planning Attorneys Focused on Helping Families with Young Kids
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    Category Archives: Financial Assets

    Hollywood Legend Lauren Bacall Leaves Large Estate and Two Potentially Large Headaches for Heirs

    Legendary Hollywood actress Lauren Bacall died on August 12, 2014, leaving behind an estate estimated at $26.6 million and three children who face a couple of potentially serious problems that could have been avoided through effective estate planning. Home estate

    Bacall, who was married to Humphrey Bogart and Sam Robards, passed away in her New York City apartment, which at a $10 million valuation constitutes a sizeable part of her estate.  Bacall used a will as the governing document of her estate plan instead of a revocable living trust, so the division of her estate is public record.

    Her will was made public a mere 10 days following her death because her children plan to auction off her artwork this fall.  As a resident of New York, Bacall’s estate will be subject to both state and federal estate taxes.  A trust left to her by Bogart will also be subject to tax based on its valuation.

    Unfortunately, her estate only included $100,000 in liquid assets at the time of her death, so her heirs face a potentially serious liquidity problem when it comes to paying these taxes. This is probably the reason behind the rush to auction her artwork. Her family has only nine months from the date of her death to pay estate taxes.

    Although Bacall directed in her will that her apartment be sold, there is no guarantee that it could sell in time to pay the estate taxes. Life insurance is one of the most common ways to ensure there is sufficient liquidity to pay taxes and other expenses.

    Besides the financial assets, Bacall left her children the right to her likeness and other intellectual property associated with her illustrious career.  (She did request that her children not sell her personal effects, letters and memorabilia in her will.) This could be of significant value in future years, and the IRS could come after the heirs for taxes based on that value.

    There could also be issues that arise regarding the management of this intellectual property in the coming years, which could lead to litigation as it has in the cases of other Hollywood greats, like Michael Jackson. To help avoid this, the family could establish a trust or family entity to manage these assets and make decisions on how they will be used in the future.

    One of the main goals of our law practice is to help families like yours plan for the safe, successful transfer of wealth to the next generation. Call your Newport Beach Estate Planning Attorneys today to schedule a time for us to sit down and talk about an Achieve Your Dreams Planning Session, where we can identify the best strategies for you and your family to ensure your legacy of love and financial security.

    How to Protect Your Real Estate Assets

    If you own real estate, chances are you have purchased insurance to protect your assets against damage or loss.  But have you taken the necessary steps to protect your assets against lawsuits or probate?

    If you own rental properties, there is likely a nagging fear in the back of your mind about being sued by one of your tenants.  And if there isn’t, there probably should be.  It’s a major risk.Real estate

    And while it may be heartbreaking to think about, there is always a chance your death could trigger a family feud over your home, vacation home or other real estate investments.

    Two common estate planning tools for real estate asset protection are limited liability companies (LLCs) and trusts:


    If you have income-producing property, then an LLC probably makes sense for you, since it protects your personal assets from lawsuits or claims that result from your ownership of the real estate.  LLCs may also offer owners privacy since the property can be listed in a company name, not in your name directly.  However, you must be sure you maintain the LLC properly so the planned for protections remain intact.  It’s not too difficult though, especially with counsel.


    If you own vacation home property that you do not rent out on a regular basis, then a trust may be a better choice for you.  There are several options:  a Qualified Personal Residence Trust (QRPT) is an irrevocable trust (meaning it cannot be changed without the consent of the beneficiaries) that allows an owner to use the property for a fixed term, and then pass the property on to heirs.  This is a commonly used structure to reduce the size of your estate for estate tax purposes.

    A revocable trust (which can be changed without consent of the beneficiaries) is more flexible and, if you choose a dynasty trust, can last for multiple generations.  The major benefit of the revocable trust, besides control of what happens to the assets after the death of the grantors, is that it keeps your assets out of the hands of the Court after your death, and totally within the control of your family.

    You can also use a combination of LLCs and trusts to protect real estate assets if you have a combination of primary residence and rental properties.  We can help you decide on the best course of action for your individual circumstances.

    Call our office today at 949.718.0420
    to schedule a time for us to sit down and talk about an Achieve Your Dreams Planning Session, where we can identify the best strategies for you and your family to ensure your legacy of love and financial security.

    A Graduation Gift that Keeps on Giving

    If you want to give a high-school or college graduate a gift with a big financial impact, go beyond writing a check. Giving the gift of investing—with individual stocks, bonds or investment accounts and even some financial planning—will help a young adult get started on the long road to financial security.

    If you have a newly-minted graduate in your family, consider giving him or her a gift that will keep on giving.

    With the generous $5.12 million gift tax exemption, in addition to the $13,000 annual gift exclusion, 2012 is the year of gifting. Giving a substantial gift in life, rather than a bequest at death, not only means seeing the fruits of your decision, butalso perhaps being there to guide it to the best use.

    A recent article in The Wall Street Journal titled “Give a Graduate the Gift of Becoming an Investor,” discussed the gift of stock to a recent graduate.

    You might say there are gifts that provide the means and then there are gifts that provide the tools, or the know-how. If you are there to assist and teach, then a gift of stock may very well be a gift that accomplishes both objectives. The stock itself has value, especially if it has been your own, and it can lead to financial security. Furthermore, teaching the financial secrets behind choosing and maintaining your portfolio is an even greater tool and life lesson.

    Choosing the stock to give is another matter. You can work together to buy something and thereby make a direct gift, or you also could give a stock you’ve owned for some time and hope to pass on.

    This second route is altogether more rewarding since it kills two birds with one stone. In addition, this move may even help keep the tax-man at bay if you’ve determined the basis and are working with a “temporarily depreciated” stock (i.e., the kind that abound these days).

    For more ideas on the kinds of financial assets to give and the lessons to teach, I highly recommend the original article as a prelude to a fuller investigation.

    Contact Meier Law Firm to discuss gifting and other estate planning strategies that you can implement to help your loved ones.

    Reference: The Wall Street Journal (June 2, 2012) “Give a Graduate the Gift of Becoming an Investor

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