Estate planning with wills and trusts

Planning your estate is a very important step in ensuring that your assets and assets are distributed according to your last wishes. The associated laws are considered a set of laws created and designed to reduce ambiguities about the distribution of an individual&39;s wealth upon death, by passing laws that reduce uncertainty about the property, powers of attorney, wills, trusts, and living wills.

The process of planning your estate can be a difficult and serious experience. However, this process is something that you should follow with a good estate planning lawyer in order to devise a good plan to prepare you for the possibility of disability and death and that all your wishes are made of the right one. way. Feel free to use a good lawyer to help you build a trust fund, write a will, and otherwise administer the asset allocation according to your plan.

The two most common and effective wills to transfer personal or property interests to another person after death are Wills and Trusts. In case you do not know yourself, the will is a type of legal document that allows the management and distribution of an estate in the event of death. It is also a type of binding document that contains your claims and wishes that will then be recognized by law and executed by the designated executor. In addition, a trust is another legal document created and designed for another person, the trustee, to manage your assets in trust on your behalf. The trustee will not only ensure the proper management of your assets under the trust, but will also be responsible for the transfer of these assets to named benefactors of the trust. If you are interested in creating these documents, you should consult an estate planning lawyer to make sure that they were created and designed in accordance with your wishes and in accordance with the laws of your state.

When you die intestate, it means that you have not explained correctly and precisely what you want to happen to the assets you have left. This situation can make your death even more complex, difficult and stressful for your family and your heirs. It&39;s up to the state to decide the asset allocation and appoint a legal guardian for your children. If you do not want to die that way, make sure you have a good estate plan to put everything in perspective.

Wills and Wills – An Integral Part of Estate Planning

Performing a will is the best gift you can give to your loved ones. When people do not take the time to write their will, this creates extra grief for the family. Instead of having a say in the distribution of your assets, a judge will decide.

The last will is used to designate an estate administrator, designate the beneficiaries to receive the property and personal effects of each, express their preferences for burial and establish guardianship for minor children.

Overall, the last will is the package that binds the loose ends of your life. Without this, others will be responsible for managing your business. Dying in the intestate (without a will) creates a terrible burden for your loved ones. If you have died today, will anyone know what to do? If not, it&39;s time to create a will.

There are many options for establishing a last will. Several websites offer downloadable forms that can be completed and notarized. Office supply stores sell preformatted forms that only need to fill in the blanks.

Most credit unions, banks and investment dealers offer estate planning services to their clients. Estate planning can range from a simple will to the creation of revocable or irrevocable trusts. The fees range from less than $ 100 to several thousand. It all depends on the value of the estate and the services rendered.

When individuals own businesses, real estate and valuable assets, they should consider using trust protection. The will is placed in trust; keep the assets out of probate and exempt from inheritance tax.

Wills must undergo the probate process if they are not protected by a trust. This process involves the validation of the will, the confirmation by the court of the administrator of the estate, the payment of creditor debts, the inventory and valuation of the assets, the production of a final tax return and distribution of assets to heirs and beneficiaries.

Trusts are generally restricted to areas valued at more than $ 100,000. Smaller properties can use techniques to keep the assets out of probate. These include the establishment of beneficiaries in bank accounts, life insurance policies and investment accounts.

The average probate estate takes six to nine months to process. Complex domains can take years to install. It depends largely on the workload of the courts, the value of the estate, and how family members hear each other.

The probate process provides a platform where heirs can voice their grievances. If they feel aggrieved or disinherited, they can challenge the will. This act rarely accomplishes anything other than the bankruptcy of the estate by over-inflating the legal costs.

Estate planning experts recommend using a probate lawyer to manage estates in the event of family dysfunction. Family conflicts are less likely to occur when a professional lawyer or professional planner is involved.

Resale Vs. New property – 10 Things to think about

Buying a resale property differs from buying a newly constructed one, both in terms of legality as well as the buying process. The properties listed on resale are often priced higher than the original cost considering factors like new amenities, pricing trends in the vicinity, ease of commuting to the city, malls, schools and hospitals, overall civic amenities in the area, etc.

However, there are several advantages of buying a resale property, such as…

  1. Immediate possession of the property
  2. Escaping the rent and EMIs simultaneously
  3. Getting to see the desired specifications completely
  4. No construction delays
  5. Time for planning your move-in
  6. Tax sops on home loan from the beginning 

In spite of the advantages at a higher price level, it is imperative to know what to expect and what you will get in a resale-apartment deal. 

There’s definitely a friend or acquaintance who has invested in a resale apartment in the past, and is evidently happy with the purchase. Ask how they went about the purchase. Also try to understand the general legal procedure. Apartment specific details may not be similar to your desire, but certain basics always match. 

  • Check for clarity in the ownership context

Although one feels it’s easy to hire a lawyer or an estate agent, it’s better to be well versed in certain areas for your own understanding. Check the title of the property, as its clearance is highly essential to avoid any sort of fraudulent selling. 

Check for all documents available with the purchase. Some of them are project commencement certificate, completion, occupancy and sale deed. Also check for the authenticity of the same with a lawyer or an agent of your choice.

  • Clearance of loans taken 

Check whether the property is completely free of past loans taken by the builder. Check with bank personnel to conduct this verification because they have the necessary network to do so. 

  • Eligibility to apply for a new loan

Considering that you need to fund your purchase through a loan, and this would be a resale property, cross check with your bank about the amount that you are eligible to receive as a loan. Verify that you have the all-important documents to process your loan application. Sometimes it is better to fund the property partly through a loan, even if you can afford the entire payment. Outsource the due diligence to bank authorities and stay rest assured about the safety of the investment. 

  • Conduct an evaluation of the property

It is important to get your desired property evaluated for its market value. This is required firstly to ensure that the finances are planned properly. Secondly, check whether the property prices are predicted to fall, which would discourage the banks from granting you a loan amount that you are eligible for. 

Make prerequisite arrangements to pay an initial lump sum amount as a down payment for the purchase. The banks usually give you close to 80% of the total price on the property as a loan. 

The ratio of loan amount received and the amount of down payment varies based on the relative age of the property. Older properties tend to be valued away from your advantage because banks try to safeguard their interest. Thus, the down payment for an older property would be a larger amount with respect to the loan you can avail.

  • Maintenance fees charged by the society

This is a monthly recurring expense after you occupy the purchased apartment. Ensure that your budget can accommodate it with the EMI that you would be scheduled to pay every month to the bank for some years as well. 

This should have appeared much higher in the list, but you can find out the reason for sale only after you build a rapport with the owner. Try finding out the reason behind the sale. Although it is not always necessary that you get authentic information, do ask to understand the intentions.

This is a blog post by Bharath Joshi who is the Marketing Executive for Unishire Signature in Bangalore.

Estate planning when mining rights are at stake

Life is hard, then the government intervenes and makes it more difficult. When you lose a loved one, grief counselors, clergy, and even funeral directors, are there to guide you and help you through this difficult time. Uncle Sam pays you estate taxes.

Careful estate planning can help ease some of the tax burden and paperwork. Some people choose to use a concept called "domain of life". In this case, the owner of a property may assign that property to another person and then continue to use the owners. rights until his death. At this point, the property automatically returns to the person who holds the act. The "tenant for life" or the original owner enjoys all the rights of an owner, including such rights on minerals, until the death. The only right he gives up is the right to sell the property.

The life estate is sometimes used to ensure that the designated heir acquires the property, to avoid any checks or to ensure that an ancestral home remains in the family (pass the property to the family). children, but allowing the surviving spouse to live there). Like any heavy action of legalese, it can be difficult to understand and conduct properly without the advice of a good lawyer.

However, if you are the lucky beneficiary of a real estate deed, you have additional options for getting help. You may have inherited a family property with rented mineral rights. This means that an oil or gas company shares a royalty percentage on any production drawn from the land. The former owner of the property (perhaps your favorite rich uncle now) has benefited from the royalties of these rights during his lifetime. Now you want to do it too.

Many royalty companies buy mining interests, but not the land itself. The process includes the simplification of all documents relating to your life domain, so that you can reap the benefits as quickly as possible and reduce taxes as much as possible. Thereafter, a royalty company converts royalty interests into cash quickly and efficiently, allowing you to mourn your uncle who has disappeared without worrying about Uncle Sam.

Find a Real Estate Lawyer

A real estate lawyer can be a person needed to work with if you find yourself in trouble with your real estate manipulations. Most of these lawyers will be able to provide you with services related to the sale and purchase of homes, commercial properties and land.

In addition, they can help settle the estate, tax liens and other disputes about your property or other property. You should seek legal advice with respect to any settlement you are attempting to make.

When hiring a real estate attorney you should take the time to learn as much as you can about them.

Here are some things you need to know before moving forward with one.

  • Determine the ability of the lawyer to provide specific expertise in the field for which you need it. If you need help with estate planning, the right real estate lawyer will specialize in this area. This allows them to be fully informed of the latest laws and amendments.
  • Do you like them? Yes, you can love lawyers and you should be able to trust the one you work with. Although you may not know them, you should be comfortable speaking with them and making the decisions that they help you make. Trust your instincts on this one!
  • Their costs play a role. There is no doubt that the cost of a lawyer should be taken into account. Look at their background in cases like yours, available in most countries, and find the best lawyer based on their costs compared to their experience.

There is no doubt that having the right real estate lawyer for the job will be a necessary consideration for you. When it comes to spending the time needed to hire one, consider it a time well invested. Without this consideration, you may end up with someone who can not provide you with the knowledge and skills you need to possess.

Administration of an area of ​​probate or trust – Sale of real estate of the deceased

As a trustee of the deceased&39;s trust or as a personal representative or executor of the probate estate of the deceased, you may be required to sell the real estate of the deceased. In doing so, you will face legal problems and requirements as well as practical problems. I will address both in this article.

If the deceased or their trust owned real estate at the time of death, you, as a personal representative or trustee, have an obligation first to protect and preserve the property. If a person resides on the property, you must determine if that person has the right to be there. Otherwise, you have the obligation to act in the best interests of the beneficiaries. This may mean taking legal action for expulsion or using another legal means to take possession of the property. You are also responsible for ensuring that the property is properly insured. The death of the deceased must be reported to the insurance company or its agent, as the vacancy of the property may affect the terms of coverage. Once these issues are resolved, you can focus on the disposition of the property. The process of selling a property differs depending on whether the property is held in trust or as part of a probate estate, but many of the fundamentals will be the same for both.

Disposition of the property.

The manner in which you will manage this assignment of real property is determined by the terms and provisions of the will or trust you administer. A variety of these types of provisions are contained in wills and trusts. Here are some of the most common examples:

1. Sell the property and distribute the product.

From time to time, the deceased will order the trustee / personal representative / executor ("administrator") to sell the property and distribute the proceeds among certain beneficiaries. In this situation, the administrator would have authority and would be responsible for the sale of the property. This includes preparing the property for sale, marketing the property (with or without a real estate broker), negotiating the contract and closing the transaction.

Upon completion of the sale, the Administrator will distribute the net proceeds to the beneficiaries (after deducting marketing and sales expenses, including closing costs, taxes and other fees) in accordance with the terms of the will or the trust.

2. Transfer the property directly to one or more beneficiaries.

The first step is to determine the title of the property. I have represented trustees who believe that a parcel of real estate bore the title of the trust that he administered. When we searched for the title, we discovered that the deceased had never transferred ownership of the property of his own name to that of the trust. As a result, the property was part of the estate of probate of the deceased.

Sell ​​the property of a deceased.

The sale of probate property or other property of a deceased poses its own problems. In many cases, the success of a sale depends on the timely closing. It is important that the personal representative has the power to sell the property as soon as possible. If the will contains power of sale, the personal representative is authorized to sell the property as soon as it is designated by the court. If the deceased dies intestate or executes a will without power of sale, a personal representative may sell a real estate only with the authorization or confirmation of the court. No marketable security will pass until the sale is authorized or confirmed by the court. In any case, the proceeds of the sale may be distributed to the beneficiaries only after full payment of all debts of the deceased.

The contract.

The most important document in any real estate transaction is the contract of sale and purchase. This is the plan of the transaction. All items that you have negotiated with the buyer must be included in the contract. For this reason, it is extremely important that the contract be written in such a way as to clearly express the full intent of the buyer and seller. If a point you have negotiated is excluded from the contract, it is likely that you will not be able to enforce it.

Real estate transactions in most states are subject to the Fraud Status, which means that all agreements for the sale of real estate must be in writing. The writing does not have to be a formal contract. There are many cases where letters, notes, memos and other writings have formed a binding contract. However, to fully understand your intent and that of the seller, it is best to define the contract in a single well-prepared contract.

609 E. Palm in Burbank just sold

I helped my buyer, Ed, find this fabulous condo in Burbank and it closed just yesterday.  Ed was recently widowed, and moved all the way from Maryland to live closer to his daughter and her family. This unit is truly special as it not only has 2 beds and 2 baths, but the kitchen and baths have been redone, there’s a loft office/bonus space, and best of all, a big private roof-top deck.  Ed now has a place to entertain his grandson and he is looking forward to putting down roots in Burbank.  Congrats, Ed!

Family Limited Partnership (FLP) for Estate Planning and Heritage Protection – Beneficial or Risky?

If you have assets of $ 1,000,000 (or even less in certain circumstances) to contribute, while keeping other assets sufficient to support you for life, you may want to consider starting and operating a family limited partnership. between members of your company. family.

Yes, an FLP is only for high net worth individuals who have significant assets and can afford to pay thousands of attorney fees to install it, to cover the expert&39;s expert fees as well as the costs of exploiting the bankroll in order to maintain it properly.

This can be as simple as if the husband and wife were giving an FLP with an asset of $ 1,000,000 or less, that it&39;s real estate property such as rental property (but not the principal residence ), money, values, business interests, etc.

As sponsors of a FLP, the spouses may hold a 10% partnership interest and a 90% limited liability interest.

The spouses, as general partners retaining an interest in a limited partnership, may then transfer limited partnership units representing the remaining 90% of the limited partnership to their children.

I. Advantages of an FLP:

A. Control of transferred assets:

The FLP Operating Agreement governs the administration, management, investment and distribution of income and assets in the event of termination. This may also limit the transfer of partnership or interest units to third parties.

The general parents partners would have control of the management and investment on the assets of the partnership, excluding children limited partners.

More importantly, it is the general partners who decide when and to what extent the partnership revenue can be distributed to the partners. They may also prohibit the transfer of partnership units or interests outside the family.

The General Partners may also form an irrevocable trust to which their interests in the Partnership would be transferred and administered by an independent trustee, or form an entity as a general partner managed by an independent trustee.

B. Present value of gifts to children:

Parents are allowed to make tax-free gifts to children or grandchildren, valued at $ 12,000 (or $ 24,000 in donations divided by both parents) each year.

These annual donations can take the form of limited partnership units in a FLP, taking advantage of the $ 12,000 annual gift exclusion to reduce death duties.

In the context of a FLP, parents can additionally take advantage of the rules of assessment of inheritance and inheritance rights applicable to minority interests, resulting in a lack of control as well as a lack market quality (non-liquidity) to reduce transfer taxes.

An evaluation expert can determine a 20% discount on the value of a partnership unit given as a gift, due to a lack of control, as well as another 20% discount due to of a lack or marketability. Such discounts can not normally be awarded in the form of a gift of similar value, intended for children.

The estate values ​​of parent-owned partnership units can also be reduced by the above-mentioned discounts, resulting in lower inheritance taxes.

C. Tax benefits:

An FLP, as a partnership, is a reporting mechanism whereby deductions and income from partnerships are directly charged to partners, whether they are general or limited, and taxed at their own rates. 39, individual taxation.

Thus, an FLP allows the proportionate share of the participation company&39;s income to be moved from the relatively higher parental tax rate to the lower tax rates of the children with limited income.

In addition, a FLP may make income distributions to the sponsoring partners – children to help them pay the income taxes attributed to the FLP.

D. Benefits related to asset protection:

Another advantage of an FLP is the protection of the assets of general partners and limited partners vis-à-vis their creditors, seeking to execute judgments on the underlying assets of the company. But the lack of commercial purpose of an FLP can cause the court to pierce its veil and make it an alter-ego of the general partners.

In fact, general partners and limited partners own only shares or interests (personal property) in a partnership or partnership (personal property) in a FLP. They do not directly own the property (real or personal) of the FLP.

The interests of the limited partnerships may be offered to minor children through an irrevocable trust for children, which would provide additional protection of the assets vis-à-vis the creditors of the principal partner&39;s donor and children.


A. Court&39;s decision that the assets transferred to a PAF are included in the parent&39;s gross estate:

An FLP would not work as discussed above, if a court decided that it was not created, implemented, and functioned properly, that is, there was an implicit agreement that the parents- General Partners would retain the full enjoyment and economic benefit of the FLP assets. .

The Internal Revenue Service (IRS) seeks to show no reduction in the valuation of gifts, as well as to include in the gross assets of the parent company the donor transferred to an FLP, in accordance with the Internal Revenue Code § 2036 (a), which only authorizes sales exemption fide.

Indeed, an FLP is vulnerable if it does not have a legitimate business purpose, does not have commercial assets as assets, or a non-tax purpose. Avoiding donations or reducing inheritance taxes and income taxes can be considered as insufficient justification for its existence.

B. Lack of Core Cost Increases for the Partnership Assets upon the Death of the General Partner:

If a low-cost asset is transferred to a FLP, the owner-parent renounces the potential increase in the base upon the parent&39;s death. If an asset has been fully amortized and / or highly valued, an FLP may not be at all advantageous, or even risky, because of its inability to use the initial cost base of the asset.

In fact, transfers of assets to an FLP give rise to transfer taxes that could have been avoided, as well as the impossibility of transmitting the inheritance to assets with a full cost price.

III. Conclusion:

A Family Owned Partnership (FLP) presents complex issues and pitfalls for gift appraisals, the inclusion of assets transferred into the donor&39;s estate, the tax burden and the application of the criteria for the sale of good faith at fair market value.

As an estate planning and asset protection vehicle, a FLP is designed for high net worth individuals who are not weak minded and are willing to spend on their own organization, funding, implementation, active management and exploitation.

(The author, Roman P. Mosqueda, has practiced partnership law and family law for more than 15 years in California.

This article is intended for informational purposes only and does not constitute legal advice. If the reader has specific problems regarding the family limited partnership, it is advisable to consult a competent lawyer and an accountant.)

Do not forget your real estate business plan

The creation and implementation of a solid business plan as a real estate professional are essential to your future success. In an industry with a large number of unsuccessful agents who give up, having this roadmap is an important success factor. Most people confuse a goal with a plan or they list a few goals on a sheet and place it in the top drawer of their desk, never to see them again.

If the goal is the means to achieve, all agents and brokers must take into account three main elements for the implementation of a strategic plan. This will help you achieve this commission / income goal and track your progress along the way. And make no mistake: creating a business plan will create success. This must be well thought out and you must be diligent in the execution of the plan.

• Achievable goals – One way to prepare yourself for failure is to set yourself an unattainable goal. If the goal is not realistic, not achieving it is a reminder of failure and not of success. Looking to the future to achieve a goal with annual progress is a better method. A good understanding of the real estate sector and the average or higher level of income currently obtained by active real estate professionals is an excellent starting point.

• Accountability – To execute a well-thought-out business plan, accountability is necessary because it must include measurable results and management of activities. It also allows you to focus on activities that perform well and produce results over those that are not productive.

• Update – Periodically review your plan and adjust it based on the results. No plan should be carved in stone because a business plan is a roadmap for the future and can not be predicted with certainty. Compare your results to the plan and be flexible to make adjustments. Do not forget that your results are due to your efforts, but sometimes to external factors beyond your control.

New real estate professionals may need to work with other agents or their real estate broker to obtain information to estimate realistic activities. There is no substitute for a quality experience and you will have most professionals happy to help you. Local market conditions, average house prices, etc. affect your business plan. Visualize your success and it will be done with an excellent business plan.

You may be paying too much in closing costs for your real estate.

San Fernando Valley Real Estate: You may be paying too much in closing costs for your real estate.

You may be paying too much in closing costs for your real estate.

Recently, a client of mine closed a purchase money loan with a big lender, who shall remain nameless but whose initials are Quicken. (oops) Although the client paid the going rate for interest that any other lender would charge, the fees the lender tacked on were way high — 2% origination fee, processing, underwriting, etc. And then both the title and escrow company loaded on what we call garbage fees. These, too, were higher than what’s competitive in the market. If you are buying or selling a home, please ask your Realtor to review the lender estimates and the final estimates before you automatically pay them — you could save a $1000 or more out-of-pocket closing costs.