You may have heard the term “Totten Trust” and wondered what, exactly, it means. While it sounds complicated, “Totten Trust” is simply another term for a payable on death (POD) bank account. It’s one option for passing on property outside of the probate process. How it Works When you establish a Totten Trust or POD account, you’ll designate one or more beneficiaries for the account. When you pass away, the funds in the account will become the property of whomever you’ve designated … [Read more...] about The Totten Trust
Part of making a comprehensive, effective estate plan is figuring out how best to pay for long-term care, should the need arise, while preserving your savings and other assets for your loved ones. Medicaid is a common option for covering the expense of long-term care, but for many people, qualifying for Medicaid takes some careful planning. So, what exactly is Medicaid? Medicaid is a need-based government health insurance program. It’s federally-established, but it’s administered on the … [Read more...] about What is Medicaid?
One of the ways that a will can be successfully challenged is to prove that the person making the will (the “testator”) was under “undue influence” at the time the will was made. This essentially means proving that someone injected himself or herself into the testator’s life, and had so much power over the testator, that the testator’s will reflects not the desires of the testator, but the desires of the person controlling him or her. In order to win on a claim of undue influence, the person … [Read more...] about Definition: Undue Influence
If you’re the parent of a child with special needs, and your child receives government benefits because of his or her disability, then simply leaving an inheritance to your child through your will is not enough to take care of him or her. In fact, planning your estate in this way might do more harm than good. Why? Because, as you know, your child is only allowed to have very limited assets. So, even if you leave him or her a small inheritance, say, $5,000, your child can lose essential … [Read more...] about Have a Child With Special Needs? You Need More Than a Will
One of the benefits of choosing a revocable living trust over a will is that, in many cases, when the trust maker passes away, his or her trust can be settled quicker and more efficiently than a will can be probated. So, exactly how long does it take to settle a trust? The answer is, “it depends”. There are a lot of factors that, taken together, determine how long it will take for your successor trustee to transfer the property in your trust to the appropriate beneficiaries. Here are a few … [Read more...] about How Long Does it Take to Settle a Revocable Living Trust?
A holographic will is one that’s handwritten. Some states recognize holographic wills as valid, and some states don’t. And among the states that accept holographic wills, there are a variety of requirements. In Texas, a holographic will is considered valid as long as it’s entirely in the handwriting of the person making the will, and it’s signed by him or her. Of course, the person making the will also has to have the necessary intent, plus the legal capacity to make a will. Sound like a … [Read more...] about What is a Holographic Will?
Did you know that you’re allowed to work while collecting Social Security retirement benefits? Whether or not your paycheck affects the amount of your Social Security depends on your age. When it comes to determining whether your benefits are affected, the government takes a three-tiered approach: Before You Reach Full Retirement Age. If you haven’t yet reached full retirement age (the range is from 65 to 67, depending on your year of birth), then earning too much money will result in a … [Read more...] about Social Security: Can You Work While Collecting Retirement Benefits?
With so much focus on the estate tax, the federal gift tax is often an overlooked topic of conversation. Here’s how it works: Annual Exclusion You’re allowed to make gifts of up to $13,000 per year, per recipient who is not your spouse. If you’re married and your spouse is a U.S. citizen, then there’s no limit to the value of gifts you can give him or her. (If you spouse is not a U.S. citizen, then you’re somewhat more limited.) Each grantor has the right to give gifts, tax-free, up to … [Read more...] about What is the Gift Tax?
The IRS recently announced the contribution limits for those funding an Individual Retirement Account during 2011 – and they’re the same as the 2010 limits. So, whether you have a regular IRA or a Roth, you’re allowed to contribute $5,000 to the account next year. If you’re 50 or older, you can take advantage of the “catch up” provision, and put an extra $1,000 in your IRA. What about Income Limits? If you’re considering a Roth IRA, you may be wondering whether the income limits will change … [Read more...] about What are the 2011 IRA Contribution Limits?
When it comes to storing your estate planning documents, you need a spot that’s secure and easily accessible. Your documents need to be protected from theft, fire, and floods and they need to be in a location where you can get to them – and where your executor or trustee can get to them, if necessary. At first blush, it might seem like a safe deposit box is the perfect place to store your documents. After all, it’s behind lock and key with all the security your bank can provide, and it’s … [Read more...] about Keeping Your Estate Planning Documents in a Safe Deposit Box? Proceed With Caution