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Avoid Bragging

With the exception of your friends and family, you should avoid sharing details about the amount that you received to the world. By planning ahead, you can make sure to keep a low profile and avoid becoming visible to creditors and others who might try to assert an interest in your money.

Avoid Going Alone

Managing a large amount of money is a big responsibility, which is why it is recommended that you enlist the assistance of professionals like a financial planner, an accountant, and an estate planning attorney.

Update Your Estate Planning Document

Receiving a large amount of money might seem like a wonderful stroke of luck, but the reality is that more money often brings with it a host of complications. Many people find themselves facing sobering tax ramifications. These people need the assistance of an experienced estate planning attorney who can help determine various strategies to protect their money now and after their passing. An estate planning attorney will also make certain that you properly update your existing estate planning documents, including your will, to reflect your newfound wealth.

Do Not be Careless

A large inheritance or lottery winning may be a great deal of money, but you still need to be responsible in handling it. Consider placing some of it in a high-interest earning savings account or a retirement account like a 401(k). Some people also decide to cautiously invest the money in the stock market. You may want to use some of it to pay off any debts that you have.

Speak with an Experienced Estate Planning Lawyer

The estate planning process can be complicated, but it is important that it be done properly to avoid making any costly mistakes. If you have questions about the process or how a recent inheritance will impact your estate plan, do not hesitate to contact Resnick Law today to schedule an initial free consultation.

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Estate planning is a particularly complicated area of law. Any mistakes that are made in a will or other document can end up creating significant errors in the administration of an estate. When these issues crop up, you will likely not be alive or aware that your estate planning documents contain errors and your wishes will not be carried out in full. For this reason, it is a wise idea to obtain the assistance of an experienced estate planning attorney who can make sure that your plans are properly created and executed.

Error 1: Incorrectly Naming Beneficiaries

Failure to name a beneficiary in estate planning documents or not reviewing estate plans and having an estate proceed to the wrong person can lead to substantial problems. If you fail to appoint a beneficiary, either your assets will pass to your estate or probate law will determine who receives them. With some types of estate planning accounts, failure to name a beneficiary can result in substantial tax complications.

Error 2: Failure to Plan for the Death of a Beneficiary

In addition to failing to name a beneficiary or naming the wrong one, some people fail to name an alternate beneficiary to receive an inheritance in case the first one dies before the administration of the estate. In most types of estate planning, it is a wise idea to both name a principal and an alternate in case an unexpected event occurs before the estate planning document is executed.

Error 3: Failure to Anticipate Complications With a Gift

Even if you have noble intentions for how a gift should be assigned, failure to anticipate the numerous complications that can arise can turn a simple but meaningful gesture into a fraught and complicated one. To make sure that your gifts are reasonable and likely to succeed, discuss your plans with an experienced estate planning lawyer.

Error 4: Not Taking Guardianship into Consideration

Never leave assets directly to a minor without first taking issues of guardianship into consideration. Nearly all minors are incapable of managing a large inheritance without adult guidance. Fortunately, there are estate planning tools that allow an inheritance to be held by someone else until the minor turns 18. There are also estate planning documents that allow a minor to receive an inheritance only on the condition that certain requirements are met.

Error 5: Failing to do Any Type of Estate Planning

Many people fail to perform any type of estate planning because they are uncomfortable with thinking about their death and do not want to consider what will happen when they are not around any longer. As a result, when these individuals die or become incapacitated, there are no estate planning documents to determine how things should be handled.

Speak with an Experienced Estate Planning Attorney

If you have questions about the estate planning process, you should not hesitate to speak with an experienced attorney. At Resnick Law, we have helped many people create and implement estate plans to achieve a variety of goals. Contact our law office today to schedule an initial free consultation.

There are a number of questions that arise when estate planning. Many people are uncertain about what effect various estate planning documents and accounts will have after their death, including their life insurance policies. The following will address the most common questions that we receive about life insurance and its effect on estate planning. Because many of these issues are particularly complex, it is often best to sit down with a seasoned estate planning attorney to discuss your unique situation.

What are the Different Types of Life Insurance?

As you begin to learn about life insurance, you discover that there are several types including second to die, term, and whole life. Each of these types of life insurance have advantages and disadvantages.

• Second to die life insurance is a type of life insurance that covers two lives and distributes the proceeds at the death of the second individual. While these policies often cost less because insurance companies are not required to pay out the proceeds to early, many times annual exclusion gifts are prohibited from being split among the couple.
• Term life insurance provides coverage at a fixed rate for a specified period of time, but after this period is over, coverage at the previous rate is no longer promised.
• Although whole life insurance remains effective for the duration of the insured individual’s life, premiums must be paid every year into the policy to make sure that it remains effective.

The exact life insurance benefit that will work best for you depends on a number of unique factors.

How do Life Insurance Policies Affect Estate Taxes?

Often, life insurance proceeds pass tax-free to the surviving spouses either directly if the spouse is named in the life insurance policy, through a tax-efficient trust, or through a Life Insurance Trust. If the beneficiary of a life insurance policy is not a spouse or if multiple beneficiaries are involved, the proceeds from a life insurance policy are taxable in accordance with the estate tax exemption amount.

What Role can Insurance Play in Business Succession Plans?

If you plan on transferring interest in your business before or after death, there is a possibility that not all of your children will be interested in gaining ownership of the business. In some situations, none of a family’s children want anything to do with the business. For this reason, the distribution of a business can present challenges when you want to equally divide your assets among your children. In these situations, a life insurance policy can be used to make sure that each child receives an equal amount.

Speak with an Experienced Estate Planning Attorney

If you are interested in estate planning, you should not hesitate to contact a knowledgeable attorney. At Resnick Law, we understand the numerous complex issues involved with estate planning and know what it takes to make sure that your wishes are fully achieved. Contact our law office today to schedule an initial free consultation.

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As time passes, many people find themselves taking care of their parents. This might include shuttling parents to medical appointments or helping them move into a smaller, more manageable living situation. Many people find themselves assuming responsibility for a wider range of tasks when it comes to caring for their parents. In these situations, many people assume legal guardianship of a parent, provided the parent reflected this decision in his or her estate plan and power of attorney documents. Unfortunately, there are some situations in which, even if you were granted the power of attorney, you still might need to petition for guardianship of a parent. This article will review some of the most common situations in which you might need to file a petition of guardianship over your parent.

Additional Medical Care is Required

There are some situations in which a person might need to petition guardianship to protect a parent’s health because the decisions in question are not authorized by the healthcare proxy. This might include situations in which a parent is unable to understand the differences between health care choices.

A Parent’s Decision-Making Capability is Reduced

A person might need to petition for limited guardianship of a parent if that parent is able to manage some areas of his or her life, but not others. For example, a court might grant guardianship over a parent when it comes to financial decisions, but not for health care decisions.

A Parent Must Go to a Nursing Home

If a parent has gotten to the point that he or she is no longer able to take care of him or herself without supervision, a child may need to consider admitting that parent to a nursing home. Sometimes, however, a parent may resist going to a nursing home. In these situations, you might need to petition for guardianship.

A Parent Refuses to Sign a Power of Attorney Document

Even after being diagnosed with the early signs of serious conditions like Alzheimer’s or Parkinson’s disease, some parents still refuse to sign estate planning documents granting a child power of attorney. Often in this situation, the child decides to let the parent continue making financial and health care decisions on his or her own until the parent is no longer aware of what he or she is doing. At this point, a skilled estate planning lawyer can help you file for guardianship over your parent.

Speak with an Experienced Michigan Guardianship Lawyer

Because petitioning for guardianship can be particularly costly and can also take a significant amount of time, it is often best to avoid guardianship decisions by making sure that a parent creates an estate plan that fully reflects his or her decisions. Speak with a knowledgeable estate planning lawyer today who can help you make these decisions. At Resnick Law, we have helped many parents create estate plans, and we are skilled at handling these situations even when unique obstacles arise. Contact our law office today to schedule an initial free case evaluation.

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When the time comes to create a legally binding estate plan, you will be required to name a personal representative to oversee your estate. The person named is usually referred to as an executor, and he or she must handle the daunting task of managing your estate while ensuring that your heirs receive their inheritances in a timely manner. Typically, the process of probate in the state of Michigan is straightforward and easy to navigate if you leave your beneficiaries a detailed will. Unfortunately, if your will or executor is challenged, things can quickly become complicated. Knowing these four reasons

Poor Communication

The role of an executor is time consuming, stressful, and requires impeccable communication skills. Throughout the process of managing the estate, your executor will work with your creditors, deal with the Internal Revenue Service, and work with the probate court. He or she will also need to communicate regularly with your beneficiaries to let them know what is happening with the estate. If your beneficiaries do not feel as if they are receiving updates on a consistent basis, they may grow dissatisfied with your executor and demand that he or she be replaced.

Disputes Over the Will

It is not uncommon for beneficiaries who are not satisfied with the way assets are distributed to challenge an entire will. Depending on the circumstances, the challenge over the will may include asking the probate court to take over administration of the estate or request that another person be appointment in the role. The request may have nothing to do with a problem with the executor themselves, the person disputing the estate plan may believe that the entire legal document is invalid, including the appointment of an executor. This process could extend the probate process by several months or years, potentially costing the estate money in the form of administration fees and other expenses.

Financial Issues

Executors often handle large amounts of money along with valuable assets, making trust one of the primary factors involved in deciding who should manage your estate. Though most executors are honest, it is possible that the executor may intentionally steal funds from your estate, leading to a call for his or her removal. In other situations, the beneficiaries of the estate may not agree with the estate management fees your executor is receiving, leading to a disagreement that could end up being resolved in court.

Contact an Experienced Attorney

Deciding who should manage your estate is not easy, and it is a decision that should be made with the assistance of a qualified trust and probate attorney. The legal team at Resnick Law understands how crucial making the right choice is, and we work with you to ensure the person you choose has the legal help necessary when the time comes to manage your estate. Our team guides your chosen executor through the process of probate administration. Contact our office today to schedule an initial consultation so that we can begin providing you the legal representation you require.

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An estate plan that is not regularly updated can result in one or more of the beneficiaries under a passing away before the testator. In that situation, any property bequeathed to the beneficiary is at risk of being distributed in a manner that is not in line with the testator’s wishes. Bequeathed gifts that fail due to the beneficiary predeceasing the testator are known as lapsed gifts.

In some cases, the testator may have put a plan in place to handle situations created by lapsed gifts; usually by naming an alternate beneficiary in the will. If there is an alternate beneficiary named in the will, the property is passed on to that person without any change in the process. Michigan law also provides another approach to handling lapsed gifts through its anti-lapse statute.

Michigan’s anti-lapse statute allows a deceased beneficiary’s children to inherit property that was intended to be left to a beneficiary and instead became a lapsed gift. In order to inherit under the anti-lapse statute, the children must be grandchildren of the testator or otherwise descendants of the testator. In other situations, if there is no alternative beneficiary, the property is passed on to the residual beneficiary named in the will – the beneficiary who receives the remainder of the estate.

If there is an alternate beneficiary or group of beneficiaries named in the will to inherit in case of a lapsed gift, the language used by the testator to outline how lapsed gifts are to be passed on can make a huge difference. For example, if the testator makes a gift to a class of beneficiaries, it can limit any distribution to that class alone, and prohibit the property from being shared among the children of the class members if they are deceased when the testator dies. This is another reason why it is advisable to use an experienced attorney when drafting a will.

For example, a woman writes a will and includes a provision that all her property should go to her husband, and if he dies before her, the property should be shared among her two sons in equal share. This provision creates a situation in which if one of the sons and the husband die before the woman, and the woman makes no changes to her will, the surviving son would inherit everything. The children of the deceased son would not inherit under the anti-lapse statute. However, if the woman’s will names the sons individually, instead of using the term “my sons,” a court is likely to distribute the property that was originally intended for the husband between one son, and the children of the other deceased son, if any exist.

Contact an Experienced Estate Planning Attorney

Revising your will is very important in order to ensure that your wishes as to the distribution of your estate are followed after you pass away. If you want to make changes to a prior will, write a new will, or discuss other estate planning options, contact Resnick Law, P.C., to consult the experienced estate planning attorneys in Bloomfield Hills and Detroit, Michigan.

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People are often advised to write wills as part of their estate planning. Wills are important because they allow a person writing the will the opportunity to decide who gets property from his or her estate. Using a will in conjunction with other estate planning tools can help avoid probate and ensure that family and friends are well taken care of after your death. When a person fails to plan by using a will or another estate planning tool, the distribution of assets defaults to state law.

When a person dies without a will, he or she dies intestate and any property that would have passed by will is divided per the state’s intestate succession laws. Any property that is not in the deceased’s name at the time of death is not subject to intestate succession. Therefore, if the deceased was able to create a trust and transfer property to the trust before his or her death, the trust property would not be subject to intestate transfer. Property such as insurance proceeds and retirement accounts are transferred to designated beneficiaries.

Under Michigan law, when a person dies intestate, his or her property is first required to be distributed to a spouse if the deceased did not have any children. If the deceased did not have any children but was married, the entire estate is inherited by the spouse. If the deceased is survived by both the spouse and children, the estate is divided between the spouse and the children. However, in this case, the spouse first gets a set dollar amount from the estate; the amount is calculated based on the increases in cost of living.

Children who are born to the deceased and a person who is not his or her spouse are also able to inherit from the deceased. The marriage status of the parents does not affect the children’s ability to inherit.

If the deceased has a spouse and no descendants, the spouse gets a large share of the estate and the rest of the estate is transferred to the decedent’s parents. If the deceased did not have a spouse or children, his or her property is distributed to the parents and siblings. Half siblings are also eligible to inherit from their half siblings.

If these close relatives are not alive, the property is passed on to the next available group of relatives, for example, grandchildren and cousins. While the state may eventually get the deceased’s property, it is only if there is no relative, even a remote one, who can inherit it. A qualifying relative can inherit from the deceased even if the relative does not live in Michigan or even in the United States, and whether or not the relative is a United States citizen.

Let Us Help You Plan

A will is an important part of an estate plan and can be used with other documents to ensure that a person’s wishes for the distribution of his or her estate are carried out. If you want to make changes to a prior will, write a new will, or discuss other estate planning options, contact Resnick Law, P.C., to consult the experienced estate planning attorneys in Bloomfield Hills and Detroit, Michigan.

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A person wishing to gift certain items or real estate to his or her closest family members and friends does not have to wait until death to make these gifts through a will or trust. It is possible to make these gifts as inter vivos gifts. However, this does not eliminate the possibility of legal challenges to the gifts later on after the death of the person giving the gift.

Inter vivos gifts are simply gifts that are made during the lifetime of a person, as opposed to a testamentary gift that is made by will or trust when a person dies. The choice to make an inter vivos gift is up to the particular person making the gift, preferably after consultation with an experienced estate attorney as to the possible consequences of making the gift in this manner.

Generally, gifts are valid if the person making the gift intends to transfer title for free; there is an actual or constructive delivery of the gift, unless it is already in the receiver’s possession; and the person receiving the gift accepts it. Once an inter vivos gift is made, it is unconditional and irrevocable, and the person making the gift loses the ability to take it back. The gift has to be fully made during the lifetime of the person making the gift in order for it to be a valid inter vivos gift.

This means that once the gift is made, the person making the gift no longer has access to that property, and even if he has a major disagreement with the beneficiary of the gift, he can no longer take back the gift in retaliation. Inter vivos gifts should not be made of property that a person may need or rely on for future needs.

Even gifts that are made inter vivos can be challenged after a person’s death. In some cases, a potential heir may try to sue to invalidate an inter vivos gift while the person who gave the gift is still alive. The challenges are often similar to those made to the validity of a will, and usually involve allegations that the person making the gift lacked the capacity to make the gift, or the person was under undue influence when he or she made the gift.

If a person chooses to make an inter vivos gift, it is important that he or she documents the intent in making the gift if it is meant to serve as the receiver’s inheritance. For instance, if a parent who has two children makes substantial inter vivos gift to one child, intending that to serve as his or her inheritance, the parent should document this intention that the gift serve as that child’s inheritance to avoid challenges when that child later receives no testamentary gifts.

Contact an Experienced Estate Planning Attorney

If you are considering making an inter vivos gift, you should consult an experienced estate planning attorneys in Bloomfield Hills and Detroit, Michigan, for more information on how this may affect your overall estate plan. To get started and to discuss your overall estate planning needs, contact Resnick Law, P.C. for a consultation.

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When a person creates a trust to distribute his or her assets upon his death, that person may sometimes name someone and grant him or her power of appointment. Power of appointment in the context of an estate trust refers to a power granted to a person to distribute the trust assets as he or she pleases. Granting a person power of appointment can be a good way to ensure that a trust beneficiary has flexibility to transfer trust assets to his or her heirs upon death. In some situations, however, it can defeat the intent of the original grantor.

Generally, when trusts are created, the grantor leaves specific people as beneficiaries under the trust. However, a grantor may want a particular person to have the power to make appropriate changes to the trust to name new beneficiaries. A beneficiary, a trustee of the trust, or another person not otherwise connected to the trust may be granted the power of appointment. A person who holds power of appointment can make significant changes to a trust after the grantor’s death, and depending on the nature of the power of appointment, may be able to grant him or herself the trust assets.  

Powers of appointment can be used to exclude people that the grantor would have wanted to receive part of the assets. For example, if one child holds power of appointment, he or she can exercise it to exclude siblings from receiving the trust assets. Similarly, the grantor’s spouse can exercise powers of appointment to exclude the grantor’s children from a previous marriage in favor of her own children. In this way, powers of appointment can be used to defeat a grantor’s true intent if the grantor would have preferred to leave assets to the excluded group.

A grantor may limit the power of appointment to help protect trust assets from creditors. Under a limited power of appointment, the person who is granted the power is allowed to transfer the assets to a wide range of people, but is restricted from making transfers to creditors.

A person who holds a power of appointment can exercise it during his or her lifetime or at death by including appropriate terms in a will. If there are specific instructions in the trust document on how the power should be exercised, then these instructions must be followed in order to make the exercise valid. It is also important that the person actually exercises the power of appointment because an intent to do so is not sufficient. If the power of appointment is not exercised, the assets are distributed as per the terms of the trust or state law, whichever is applicable.

Contact an Experienced Estate Attorney

It is important to ensure that you understand the implications of making certain elections in your estate planning documents. You should speak to an estate planning attorney before granting anyone power of appointment in order to ensure you understand how that will affect your beneficiaries. If you are looking for legal assistance in setting up a trust or otherwise planning your estate, you should contact Resnick Law, P.C., to speak to the experienced estate planning attorneys in Bloomfield Hills and Detroit, Michigan.

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One way in which financial elder abuse can happen is when an elderly person can no longer take care of his or her finances and is perceived as an easy target to be exploited. In these situations, someone may need to take over the elderly person’s affairs. This may be done through seeking conservatorship over the person’s estate.

The initial concern for conservatorship is whether the person whose property is to be placed under conservatorship is legally incapacitated. To start the process, a qualifying person files a petition for conservatorship with a court. The petitioner has to prove that the person to be protected through conservatorship is not competent and cannot take care of him or herself. The court may also appoint a guardian ad litem to help the court decide whether conservatorship is the best option. Once conservatorship is approved, the person to be protected under the conservatorship is referred to as a protected individual.

When a petition for conservatorship is filed, other interested people have to be notified of the petition in order to enable them to file any objections they may have to the petitioner being appointed as a conservator. The person who is the subject of the petition can also contest the conservatorship. Petitioners usually have a connection to the person they seek to protect; for example, an adult child may file a petition for conservatorship over a parent. If there are multiple adult children that all qualify to serve as conservators, the court chooses the child the court finds to be the most qualified or capable to take on the responsibility. Generally, the court can appoint any competent person over the age of 18 years old to be a conservator, which includes professional conservators.

Once appointed, a conservator is responsible for managing the protected person’s property and ensuring that it is not wasted or dissipated. The decisions the conservator makes regarding the management of the property can be reviewed by a court, and if the conservator has misused funds, the court can order the conservator to pay the money back. A conservator is entitled to reasonable compensation, however, and this may sometimes be taken from the property the conservator is managing.

Contact Us for Legal Assistance

If you are concerned about a family member who is elderly and at risk for financial exploitation, you should explore the possibility of petitioning for conservatorship. This can be a difficult decision to make, and it is best to have an experienced attorney walk you through the process of filing a petition and help you understand the responsibility you will be taking on. For more information on conservatorship in Michigan, contact us at Resnick Law, P.C., in Bloomfield Hills and Detroit, Michigan, to schedule a consultation.

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