How Long Does Probate Take?

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Probate is a dreaded process for many, full of uncertainty. Most people haven’t heard of probate prior to losing a loved one. It is a process that nearly every estate must pass through (with exceptions, of course). Many people find themselves wondering, how long does probate take? To answer this question, you need to understand how the process works. 

What is Probate and How Long Does Probate Take?

Probate is the legal process that validates the legality of a will. In this process, a judge determines the validity of a will and declares it legal or invalid. How long does probate take? This process can last from six months up to two years. However, some probate cases have been known to drag on for years. While most probate proceedings are not as time-consuming, cases with high-assets, missing financial information, or cases that do not have a will tend to be significantly lengthier. It is highly recommended to hire an attorney to assist you with expediting the process and protecting the decedent’s assets.

Typically when a will is included, the cases are on the shorter side, however, if the judge believes that part of the will is invalid, the process will be much more extensive.

What Happens During Probate?

The first step is to establish an estate representative to represent the beneficiaries during the court proceedings. An estate representative is typically the executor of the will if a will exists, or it can be another person that is close to the deceased person.

During the legal process, personal representatives of the probate court will collect all assets and pertaining information, and provide the court with a basic catalog of the assets and determined worth. 

Next, the beneficiaries of the inheritance are determined, based on either the will or their relationship to the deceased person. After the beneficiaries are determined, the representatives determine how and when the funds should be distributed. If there is a valid will, then this would be per the directions of the will and the reality of meeting logistical demands.

Finally, the beneficiaries examine the document describing the distribution of assets and determine if they approve the process, or raise any objections if need be. Once this step is complete, the court approves the estate distribution process and the assets pass probate.

Does My Estate Have to Pass Probate?

Some people chose to allow their loved ones to bypass the probate process by passing their inheritance through a revocable living trust instead of a last will. Revocable living trusts designate assets to a trustee, who is then responsible for distributing the assets to the beneficiaries. This allows the transference of assets without a lengthy process.. It is typically advisable to create a revocable living trust if you own real property and want to avoid the costly delay in the process. 

While revocable living trusts are the most common alternative, other strategies include asking a qualified lawyer to create joint ownership of property or gifts, or pay-on-death accounts and registrations.

Understanding How an Attorney Can Help You

If you are uncertain and need to know how long does probate take in regards to your case, it is highly recommended to discuss your options with a qualified probate attorney. Call our office today to set up a free 30-minute consultation with LPEP. Our reputable law firm in the Bay Area specializes in high-net-worth estate planning. Our large team represents some of the best talents in the San Jose and Santa Clara areas, providing you with the necessary resources to protect your assets and work through the process. Set up a free 30 minute consultation here. (Virtual options available)

What Is Probate?

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When a loved one passes away, you’re consumed with grief. The last thing you want to think about is how assets are divided up. Unfortunately, dealing with assets and the estate is necessary in the aftermath of one’s passing. If you’ve recently lost someone you care about, you may find yourself wondering “What is probate?” Learn what it is and how you can navigate this legal process. 

What Is Probate?

Probate is a legal process that occurs after someone passes away. In this process, a court determines how that person’s assets will be divided up. It also dictates how creditors will be paid. Having a valid will can make all the difference in how this process unfolds. You may have heard bad things about probate. This usually has to do with how time-consuming and lengthy the process is. The probate process is paid for out of the estate, so the longer a case goes on, the more depleted the estate will become. 

a lawyer in a blue button down explains what is probate as he signs documents

Testate vs. Intestate Wills

Testate means there is a valid will in place, while intestate means there was no will, or the will was proven to be invalid. If the will is valid, the court will use this to name an executor and follow some of the last wishes laid out in the will, if not all of them. When a person dies intestate, the assets will be distributed via California probate law on intestate succession. There will be a court-appointed representative in charge of distributing assets. Dying intestate can elongate the probate process, so setting up a final will and testament can greatly help your loved ones in the future. Regardless of whether your loved one died intestate or testate, some of the steps for probate are the same. 

1. Notification

The executor named in the will or appointed by the court is responsible for notifying all creditors and heirs of the probate proceedings. California probate law allows creditors up to one year to place a claim against the estate for repayment. After that window has expired, they may not file a claim in most cases. All heirs, including the ones not mentioned in the will need to be notified of the proceedings. Any heir that sees fit has the right to contest the will. Waiting for all heirs to come forwards and for creditors to come forward is one of the lengthier steps to probate. 

2. Debts & Taxes

The executor is in charge of paying off debts and taxes using the assets and estate. The executor must file both personal and estate tax returns if the estate is over a certain income. This adds time to the probate process as it generally takes the IRS 3-4 months to process estate tax returns. Any claims of debt against the estate made in the one year period after notification will need to be paid off using the estate. When an executor is named, they are responsible for the estate and its financial management. If you are the executor of an estate and need help with probate proceedings, contact our San Jose lawyer, Michael Lonich. He is an expert in estate planning and probate. 

3. Assets & Division

After debts and taxes have been taken care of, and if no heirs have decided to contest the will, asset division can begin. With the help of a judge, assets will be passed on how the will lays out or how the court dictates. If an heir does decide to contest the will, probate cannot begin until these proceedings are completed. The contesting of a will can take years to resolve, which is a drain on the estate and extends the probate proceedings indefinitely. 
What is probate and what steps must an estate go through for assets to be distributed? If you are an executor or an heir in a probate case and have questions about the next steps, contact our legal offices at Lonich Patton Ehrlich Policastri. We offer free 30 minute consultations – both virtually and in person. You can set your consultation up here.

Three Things to Know About Creating a Living Trust

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First, one of the biggest advantages of creating a living trust is avoiding probate court.  Administering a will or trust through probate court takes time and money.  A living trust is a great estate planning vehicle because it can keep the entire administration process court-free.  When the settlor of the trust passes away, the terms of the trust dictate how the estate should be administered. In turn, probate court is avoided.

Second, make sure that the successor trustee is someone who is capable of administering the trust.  Often times, the oldest child is chosen to be the successor trustee.  However, the oldest child is not always the right choice.  A successful administration requires a trustee who is organized, diligent, and capable of administering the trust.  It is also beneficial to have someone with an understanding of accounting.  If your oldest child does not have any of these characteristics, consider appointing another child, relative, or friend.  If no one you know is capable of administering the estate, you may have to hire a third party. There are a number of trust companies and banks that administer trusts.  The biggest concern about hiring a third party is the administration fees, which can be substantial.  If your estate can handle the fees, a third party may be the right choice for you.  Lastly, a trust will never fail for lack of a trustee.  If the elected trustee refuses, another one will be appointed.

Finally, creating a trust avoids California’s intestacy laws.  A state’s intestacy laws provide the default estate plan for those who die without a will.  In California, the beneficiary of a decedent’s estate depends on whether the property was community property or separate property.  Assuming that decedent was married and had community property, the surviving spouse’s intestate share is the decedent’s one-half share of the community property.  On the other hand, if the decedent’s property was separate property, the intestate share of the surviving spouse depends on how many children the decedent had, if any.  While it is important to know a state’s intestacy laws, they should be avoided at all cost.  Thus, creating a trust is a way to avoid intestate succession and have your estate administered the way you want it.

If you are interested in creating a living trust or have any questions regarding your current estate plan, please contact the experienced estate planning attorneys at Lonich Patton Erlich Policastri for further information.  The attorneys at Lonich Patton Erlich Policastri have decades of experience handling complex estate planning matters, and we are happy to offer you a free consultation.  Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

Sources:

California Probate Codes § 6400-6414.

How to protect your assets, even if you didn’t win the billion dollar powerball

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After the historical $1.5 billion jackpot was finally won, it is time for many of us to consider how to protect our assets during our lifetime and after. Although winning the lottery may not be something we will experience, many of us do have valuable assets that we would like to protect when we are gone.  Therefore, this year it might be time to give your estate plan a review.

An important tool in estate planning to consider is the living trust (also called a revocable living trust). In its simplest form, a living trust is a written agreement which sets forth what happens to your assets in the event of your death.  One of the greatest advantages of a living trust is that it protects your estate from the probate process, which can be time consuming and expensive. And while a living trust is primarily used as a convenient and efficient way to distribute your assets upon death, you still maintain control over all your assets during your lifetime. Therefore you can alter, add or revoke the living trust at any time for any reason.

In many situations, a trust is the best way to achieve your goals. With a trust you can:

  • Avoid probate
  • Provide for your care should you no longer be able to handle your own affairs
  • Provide for children from a previous marriage
  • Hold money for minors and ensure they cannot spend it all the minute they come of age
  • Protect assets from creditors and former spouses
  • Benefit family and charity through one mean

Probate, on the other hand, is the process the court utilizes to manage the affairs of a decedent’s estate. In contrast to a living trust, the probate process, in most metropolitan areas in California, can take about 6- 18 months. This delay creates additional expenses that can consume 3% to 6% or more of the gross value of the probate estate.

At Lonich Patton Erlich Policastri, our estate planning attorneys don’t believe in offering services that are “one size fits all.” We understand that each family has particular needs and concerns, and we can customize our estate planning services to meet these specific needs and ensure that your long term wishes are carried out. If you are interested in nonprobate transfers or have any questions regarding your current estate plan, please contact the experienced estate planning attorneys at Lonich Patton Erlich Policastri for further information. The attorneys at Lonich Patton Erlich Policastri have decades of experience handling complex estate planning matters, including nonprobate transfers, and we are happy to offer you a free consultation. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

Source:

http://www.forbes.com/sites/deborahljacobs/2012/01/04/make-a-new-years-resolution-to-give-your-estate-plan-a-checkup-2/#2715e4857a0b7be8584f7cf0

Question: What happens to your Facebook account when you die?

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Answer: Now, you can designate someone to control your Facebook account with the legacy contact option.

As estate planners, we see people each day who think about what happens to their personal effects when they pass away. We write wills in order to designate who should receive a client’s material possession upon their death and answer questions like; where do my assets go? Who will maintain control of my estate when I pass away? But more and more of us are starting to consider what happens to our digital possessions such as our Facebook accounts when we die. Facebook has responded by creating what they call a “Legacy Contact.”

Up till now, when Facebook learned that someone died, they would offer only a basic memorialized account that other people could view but couldn’t manage. It would be frozen, angering heirs who wanted to edit the deceased’s online presence. When Alison Atkins died in 2012 after a battle with a colon disease, her sister and parents wanted access to her digital assets. Slowly, these accounts began shutting down in order to protect Alison’s privacy, per the websites’’ terms of service. Later that year when her Facebook account disappeared, her family felt like they were losing another part of Alison.

However, starting this Thursday, you can assign a legacy contact who can have more room to manage an account when the user dies.

Your legacy contact will have limited control

There are limits, however, to what a legacy contact can do. A legacy contact can:

  • Write a pinned post for your profile (ex: to share a final message on your behalf or provide information about a memorial service)
  • Respond to new friend requests (ex: old friends or family members who weren’t yet on Facebook )
  • Update your profile picture and cover photo
  • Download a copy of what you’ve shared on Facebook (this is an additional option that you can add/decline)

There are several things your legacy contact cannot do, and you should be aware of them. A legacy contact cannot:

  • Remove or change past posts, photos and other things you’ve shared on your Timeline (regardless of how embarrassing they might be)
  • Read messages you’ve sent to other friends
  • Remove any of your friends

Choosing your legacy contact

Once you have decided who your legacy contact will be, selecting them is easy. A concern that is coming is what if you select your spouse but you both travel frequently together? What if you both die? At this point in time, you can only select one person with no back up.

Estate planning has always been a complex field and the digital era is adding new complexity to this process. Facebook and other tech companies are starting to realize this, prompting changes to their terms of service. In 2013, Google began allowing people to assign beneficiaries of their Google accounts as well.

Whether you are concerned with devising a plan for either a family estate or that of a business, it is important to get good advice. The attorneys at Lonich Patton Erlich Policastri have decades of experience handling complex estate planning matters including business succession plans, wills, and living trusts. If you are interested in developing an estate plan or reviewing your current estate plan, contact the experienced estate planning attorneys at Lonich Patton Erlich Policastri for further information as we are happy to offer you a free consultation.

Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

How will proposed tax reform affect your estate plan?

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On January 20th, 2015, President Obama stood before a joint session of Congress and delivered the annual State of the Union address. Some of the topics discussed were the current State of the Union, College Savings Plan reform, his legislative agenda as well as several White House proposed tax reforms for the upcoming fiscal year.

While many of his new policies will affect all Americans in some way, several of his proposed tax increases will particularly affect upper-income persons and financial corporations. One in particular is a proposed change to the tax on appreciated estate property, otherwise referred to as the “trust-fund loophole.”

Taxation on Appreciated Estate Property

The term Capital Gain stands for the profit realized on the sale of a non-inventory asset that was purchased at a cost amount that was lower than the amount realized on the sale.  In the United States, individuals and corporations pay U.S. federal income tax on the net total of all their capital gains just as they do on other sorts of income. “Long term” capital gains are generally taxed at a preferential rate in comparison to ordinary income.

Currently, the law states that property which has appreciated in value that is owned by an estate is generally not subject to tax at death. Under this tax scheme, children and other heirs typically receive and sell property with little or no capital gains tax since most property receives an increase in basis to fair market value. For example, a parent who dies can pass along a valuable asset to their child or heir with no capital gains tax being due. When the child or heir eventually sells the asset, the current law limits the eventual tax bill by figuring the taxable gain only since the parent’s death. While this is a feature commonly known as a stepped-up basis the administration refers to this as the “trust fund loophole” and is looking to change it.

The White House proposal is to tax this appreciated estate property. The proposal states that the tax will be at 28% if the difference between the cost of the property and the fair market value at death exceeds $100,000 per person. There would be a separate exclusion for a personal residence of $250,000 per person. The proposal would not include clothes, furniture and most other personal items.

In arguing its case for revising this aspect of the tax code, the White House claims that all of the gain on valuable property or assets that occur prior to the death of a parent unfairly escapes tax. The White House claims it is in good company. Critics of the current tax code say that it is outdated. They claim that while the current policy reduces disputes over prices paid for assets long ago, they acknowledge that revision to the tax code would unlock capital by removing an incentive for holding valuable assets for generations.

Many experts, such as USC tax expert Edward Kleinbard, agree. Mr. Kleinbard notes that the capital gains tax is our only truly voluntary tax. Taxpayers can defer it for a considerable amount of time simply by withholding on the sale of their taxable assets. He argues that if you’re rich enough to hang onto your stocks and bonds, or can utilize financial strategies to enable you to exploit their value without selling them, you can defer paying capital gains tax your entire life.

Whether the White House prevails in passing this legislation remains to be seen. It seems clear, however, that negotiations on tax policy will continue in attempts by the current administration to eliminate tax loop-holes. Eliminating the lock-in effect, where holders of appreciated assets avoid selling because of the taxes imposed on the sale, could have a major impact on estate planning strategies and should prompt concerned individuals to look more closely at their estate plans, which should be revised periodically to ensure the best treatment of ones assets.

These are issues that make estate planning a complex field. Whether you are concerned with devising a plan for either a family estate or that of a business, it is important to get good advice. The attorneys at Lonich Patton Erlich Policastri have decades of experience handling complex estate planning matters including business succession plans, wills, and living trusts. If you are interested in developing an estate plan or reviewing your current estate plan, contact the experienced estate planning attorneys at Lonich Patton Erlich Policastri for further information as we are happy to offer you a free consultation.

Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

 

Estate Planning Lessons from Robin Williams

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As many of us mourn the loss of this great comedic genius, new information is still coming forward about Robin Williams. According to ABC News, with more than half of his movies portraying Williams as the leading man, his movies grossed over $6 billion throughout his career. While he was paid $165,000 per episode for his one season of The Crazy Ones, it is unclear whether he returned to television because of alleged “bills he had to pay” following his two divorces.

Robin Williams is survived by his third wife, Susan Schneider, who was married to him for 3 years, and his three adult children from his prior two marriages whose ages range from 22 to 31. The question for them now is what was the state of his financial affairs when he passed away?

While it appears from public record that Williams left real estate with equity of around $25 million behind, it is unclear what else he left for his heirs. What is clear, however, is that Williams appeared to have several estate planning documents which will be invaluable to his family. These include two different trusts. The first is the “Domus Dulcis Domus Holding Trust” (Latin for “home sweet home”). TMZ also reported that someone had leaked a copy of a different trust, which Williams created in 2009. This would have been while Williams was in the middle of his divorce from his second wife, Marsha Garces.

This trust reportedly named his three children as beneficiaries, splitting their trust funds into three equal distributions for each of them, set to pay out when they reach ages 21, 25, and 30. While the Domus Dulcis Domus Holding Trust appears to have been done to minimize estate taxes, this second trust accomplishes the goals of safeguarding privacy for Williams and his family since trusts avoid probate, keeping his affairs private (as long as they are not leaked to the media).

If you would like to learn more about trusts or avoiding probate in general, call Lonich Patton Erlich Policastri to schedule a free half-hour consultation. Our attorneys are passionate about estate planning and have decades of experience handling complex estate planning matters, including wills and living trusts. If you are interested in developing an estate plan or reviewing your current estate plan, contact the experienced estate planning attorneys at Lonich Patton Erlich Policastri for further information.

Tax and Estate Planning for Same-Sex Couples

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Earlier this week, the U.S. Court of Appeals for the 4th Circuit struck down Virginia’s same-sex marriage ban, saying that withholding the fundamental right to marry from same-sex couples is a form of segregation that the Constitution cannot tolerate.

In June 2013, the Supreme Court of the United States in United States v. Windsor, held that the federal government must recognize same-sex marriages and that it is up to state Legislatures to define marriage within state boundaries. Since then, numerous law-suits challenging the constitutionality of state DOMAs on equal protection and due process grounds have prevailed in various federal and state courts. Currently, 19 states, including California, plus the District of Columbia recognize same-sex marriage (recognition states), while 40 states prohibit it (non-recognition states).

The prevailing prediction is that a Supreme Court guarantee of a right to marriage is on its way. American support for same-sex marriage is at a new high of 55 percent, and California support is at 61 percent and increasing, if the trends continue. It is important for all couples to create an estate plan. Additionally, it is important for same-sex couples to be aware of the potentially complicated issues that arise when they move across state lines.

Same-Sex Couples Living in California

Same-sex married couples now living in California enjoy the same benefits and burdens under state and federal law as married opposite-sex couples. Before Windsor and IRS Revenue Ruling 2013-17 (which extended federal tax benefits to married same-sex couples, regardless of their state of residency), many married opposite-sex couples likely took this preferential treatment for granted.

Some of these benefits include:

  • Property transferred between spouses incident to a divorce is not subject to income or gift tax;
  • Spousal support (alimony) payments are tax deductible to the paying spouse;
  • Child support payments are not subject to income tax;
  • Spouses receive a community interest in 401(k) accounts and other retirement plans; and
  • Spouses receive all community property and anywhere from one-third to all of the deceased spouse’s separate property for intestate (when a person dies without a will or other non-probate instrument) inheritance purposes.

All couples should be aware of their legal rights at marriage, divorce, and death. It is important for both same-sex couples and opposite-sex couples to consider pre-marital agreements, estate plans, and any tax consequences that arise from marriage or divorce.

The Marital Status of Migrating Same-Sex Couples

When a same-sex couple moves out of California, their marital status will depend on the other state’s law with regards to various issues including, state tax filing status, intestate succession, guardianship and conservatorship appointments, and adoption and artificial reproductive technologies. In other words, a non-recognition state may not recognize the otherwise valid same-sex marriage.

If and when the Supreme Court guarantees a right to marriage, moving across state lines will no longer be an issue for same-sex couples. However, in the interim, it is important to be aware of the possible legal consequences.

For example, under Florida law, the definition of “heir” does not include same-sex spouses for intestate inheritance purposes. This means that a same-sex couple that was married in California, but permanently living in Florida, will not inherit from each other under the Florida intestate system. Some courts in non-recognition states are willing to recognize same-sex marriage in certain contexts through the doctrine of comity, which is where a court gives deference to another state’s laws. However, most surviving spouses want to avoid litigation because it can be a headache, requiring time, money, and mental energy.

In some cases, it might be worthwhile for same-sex spouses to opt out of the intestate system with non-probate instruments, such as estate plans. A same-sex couple’s estate plan needs to be drafted with precision, specifically naming beneficiaries, rather than using general terms such as “spouse.” This becomes especially important if a same-sex couple moves to a non-recognition state, where the court may not interpret a same-sex spouse to qualify as a spouse or heir. If any other blood related heirs of the deceased spouse were to contest the non-probate instrument, they could end up inheriting property that would have gone to the same-sex spouse in California or another recognition state.

If you are a same-sex couple and are considering marriage, or need to create or update an estate plan, please contact our California Certified Family Law Specialists. Our attorneys have decades of experience handling complex family law and estate planning matters and offer a free consultation.

Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may include legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

Estate Tax Portability: A Valuable Asset You May Not Know You Had

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Have you heard about the “portability provision?” Believe it or not, your estate (or your spouse’s estate, if you were to pass first) could benefit tremendously if the executor of your estate elects this provision. In short, the portability election allows the transfer of any unused estate tax exclusion amount of the first spouse to die (commonly referred to as the “deceased spouse’s unused exemption” or “DSUE”) to the surviving spouse, who can then utilize the remaining amount to benefit his or her gift or estate tax purposes. Essentially, this provision operates as a safety net for couples with joint assets exceeding the exemption amount for the estate of the first spouse to die because the surviving spouse can reduce his or her estate or gift tax liability. Depending on the size of the estate, electing this provision can mean saving a significant amount on estate taxes.

Although this portability provision technically expired after 2012, Congress passed the American Tax Relief Act of 2012 (“ATRA”), which made the “portability” of the applicable exclusion amount between spouses permanent. This favorable estate tax rule should be incorporated into estate plans because as previously mentioned, the potential impact of the portability provision can be quite substantial.

For example, suppose the following: A husband and wife each own $2 million individually and $3 million jointly with rights of survivorship, bringing their estate to a total of $7 million in assets. Suppose their wills instruct that all assets pass first to the surviving spouse and then to the couple’s children. If the husband dies in 2014, his $2 million in assets is covered by the unlimited marital deduction. His $5.34 million exemption remains unused (his DSUE). When the wife dies, her estate can use that leftover DSUE amount, in addition to the exemption for the year in which she dies, to shelter the remaining $7 million of assets from tax. ATRA has permanently set the top estate tax rate at 40 percent. As such, if the wife died later in 2014, $1.66 million in assets would have been subject to estate tax without the portability provision. Therefore, the family saves $664,000 in federal estate tax (40% of $1.66 million).

Not only is the portability provision an excellent tool to use for estate and gift planning considerations, the provision can also be used as a negotiation tool during marital agreement negotiations. The portability provision can be viewed as a highly valuable asset that attorneys and their clients should consider when drafting marital agreements. However, there are also certain limitations to be aware of. For example, the executor of a deceased spouse’s estate must elect portability for the provision to take effect, and the election must be made on an estate tax return filed within nine months of death.*

If you or your loved ones are in the planning stages of creating an estate plan, take the necessary steps to ensure that you and your family members are maximizing the benefits available to you by an experienced, knowledgeable estate planning attorney guide you through the process. Estate planning laws are constantly evolving and having a trusted estate planning attorney by your side can prove to be invaluable. The attorneys at Lonich Patton Erlich Policastri have decades of experience handling complex estate planning matters, including wills and living trusts, and we are happy to offer you a free consultation.

Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

Sources: http://www.bizactions.com/n.cfm/page/e120/key/259853661G1005J3585631N0P0P2268T2/;http://www.forbes.com/sites/lewissaret/2014/02/25/estate-tax-portability-and-marital-agreements-a-new-consideration/

Elder Abuse: Protect Your Loved Ones From Financial Exploitation

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Financial exploitation of the elderly is a growing – and mostly silent – epidemic in our country. In fact, one study estimates the amount lost by exploited seniors to be nearly $5 billion every year. One prime example occurred in 2007, when renowned New York society queen and philanthropist Brooke Astor left behind a coveted estate of nearly $200 million dollars. Though her will appeared to be adequately in place, the three codicils that followed turned out to be anything but.

Under Astor’s will, her only son, Marshall, stood to take tens of millions of dollars – with the condition that remaining funds after his death be given to charity. Marshall, however, had other plans, and the country watched as the truth behind Ms. Astor’s will began to unravel: Marshall, along with his lawyer, had convinced the elderly Astor – while she was suffering from dementia – to sign a series of codicils allowing him to leave much of her fortune to whomever he wanted. Rumor has it that Marshall wanted to share his mother’s fortune with his much-younger wife – whom Astor reportedly detested.

Fast forward to 2009 after 6 months of trial and many millions of dollars later, Marshall (then 85-years-old) and his attorney were convicted of 14 counts out of 16 for financially exploiting Astor. But after 8 weeks in jail, Marshall was out – the parole board found his age, ailing health, and hundreds of support letters from some of New York’s most influential people compelling and released him. With these turn of events, Marshall’s financial exploitation of his mother (to the tune of tens of millions of dollars) essentially went unpunished.

The highly-publicized financial exploitation of Ms. Astor is only one of the millions of cases of financial elder abuse that goes on quietly behind closed doors each year. When a family member manipulates a person with dementia, it is undue influence. California Civil Code § 1575 explains that undue influence comprises of:

  • The use, by one in whom a confidence is reposed by another, or who holds a real or apparent authority over him, of such confidence or authority for the purpose of obtaining an unfair advantage over him;
  • The taking of an unfair advantage of another’s weakness of mind; or
  • The taking of a grossly oppressive and unfair advantage of another’s necessities or distress.

Financial abuse of an elder or dependent adult can occur through various ways – undue influence is only one of them.* Sadly, many greedy individuals will find their elderly family members to be easy targets for financial gain, particularly when the elderly individual’s mind is stricken with a degenerative disease like Alzheimer’s or dementia. The undercover coercion and undue influence to change an estate plan can be hard to notice because these manipulative acts are generally covert and completed with no witnesses around. Even if the coercion is discovered in time, proving it in court can often be an uphill battle.

If you or your loved ones are in the planning stages of creating an estate plan, take the necessary steps to ensure that you and your family members are protected by having an experienced, knowledgeable estate planning attorney guide you through the process. If you suspect undue influence, consult an experienced estate planning attorney for an objective assessment to ensure the decedent’s assets are distributed as they intended. Estate planning laws are constantly evolving and having a trusted estate planning attorney by your side can prove to be invaluable. The attorneys at Lonich Patton Erlich Policastri have decades of experience handling complex estate planning matters, including wills and living trusts, and we are happy to offer you a free consultation.

Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results.  While this post may detail general legal issues, it is not legal advice.  Use of this site does not create an attorney-client relationship.

* California Welfare and Institutions Code §15610.30(a).

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LONICH PATTON EHRLICH POLICASTRI

1871 The Alameda, Suite 400, San Jose, CA 95126
Phone: (408) 553-0801 | Fax: (408) 553-0807 | Email: contact@lpeplaw.com

Located in San Jose, Lonich Patton Ehrlich Policastri handles matters for clients in northern California, specifically San Jose and Silicon Valley. Our services are available to anyone within the following counties: Santa Clara, San Mateo, Contra Costa, Santa Cruz, Monterey, and San Benito. For a full listing of areas where we practice, please click here.

DISCLAIMER

This web site is intended for informational purposes only and is not legal advice. Nothing in the site is to be considered as either creating an attorney-client relationship between the reader and Lonich Patton Ehrlich Policastri or as rendering of legal advice for any specific matter. Readers are responsible for obtaining such advice from their own legal counsel. No client or other reader should act or refrain from acting on the basis of any information contained in Lonich Patton Ehrlich Policastri Web site without seeking appropriate legal or other professional advice on the particular facts and circumstances at issue.

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