Saturday, March 27, 2010

On-line Registration for Organ Donation in Wisconsin

Wisconsin residents have a new way to consent to organ donation -- on-line registration. Sign up consists of entering your name and drivers license number. Channel300's web site states:

Offering online registration instead of just when receiving a driver's license is expected to increase the number of donors. Already more than half of Wisconsin's population has signed up to donate organs.

The new web site,, will be promoted next week by First Lady, Jessica Doyle.

Monday, March 22, 2010

Do You Need A Living Trust?

A few weeks ago I came across a full page ad in our local paper promoting a seminar on living trusts. Reading it, I started shaking my head in disagreement. Many of my clients and seminar attendees think that a trust is what they need. When I probe and ask why, they can't really give a good answer, it is "just something I've heard". Why have they heard this -- the skeptic in me says "because living trusts are lucrative for the people who draft them". In my practice, very few clients need a living revocable trust.

The ad criticizes wills because
  • attorneys are needed, well attorneys are needed in the creation an often the administration of trusts;
  • expensive probate fees. In Wisconsin, the probate fee is .02 percent, or $2 for every $1,000 in probate assets. Often times the probate fee is less than the cost of creating and funding a trust;
  • totally public and court controlled. In some cases, this is advantageous. When a trust is involved, there is no court oversight to ensure that beneficiaries receive the proper distribution -- what if the named trustee opts to not send a check to the non-profit listed -- I've heard of this happening.
Living Trusts do have there place. Here are a few situations when I feel a client should consider a living trust:
  • a desire to keep finances private; ideal for blended families or business owners;
  • when property is owned in multiple states AND no other non-probate options are available, such as Transfer on Death Deeds; and
  • when there is a desire for an asset to be held in trust, managed by a trustee, for a long-term basis (i.e. 5 years or more).
Remember, living revocable trusts will not minimize your estate taxes or preserve assets if you need long-term care.

Transforming a probate asset into a non-probate asset can be achieved by multiple instruments, most of which are less expensive than a living revocable trust. Be certain to consider all of your options -- and ask for a cost benefit analysis to ensure that you are in fact saving money if that is your primary goal.

Monday, March 15, 2010

Scattering of Ashes

My father, upon is death, was part of a new American trend....opting for cremation over burial.

Before about 1980, just 4% of families were choosing cremation over burial. Now, 39% select cremation, and in the next 15 years, the percentage is expected to approach 60%, according to the Cremation Association of North America. The increase is being driven in part by cremation's cheaper cost, and in part by the fact that fewer extended families are rooted in one specific place anymore—which means they don't live close enough to visit a loved one's
My father did not opt for "wild cat scattering" a term used to describe the scattering of ashes in nature / society, instead, his rest in a plot in a family cemetery. However, routinely clients inquire about the ability to scatter a loved ones ashes. Here is a nice article, summarizing the concept and offering creative inspiration.

Transfer on Death Deeds and Avoiding Probate

For whatever reason, many clients wish to minimize or avoid probate. In the past a living revocable trust was utilized to accomplish this goal. However, this dated, and often expensive device can be replaced if the bulk of an estate is held in a home. Several years ago Wisconsin adopted the Transfer of Death Deed. And I recently came across a wonderfully concise description:

A TOD Deed allows the owner of real property to execute a deed that names a beneficiary who will succeed to ownership at the owner's death. Because the TOD Deed creates no rights in the beneficiary until the owner dies, the owner can change his or her mind during life, and the beneficiary's creditors cannot attach the beneficiary's interest in the property during the owner's life. The recordation of the TOD Deed also does not create a completed gift for gift tax purposes because no transfer of ownership takes place until the owner dies.

From, Death Without Probate: TOD Deeds--The Latest Tool in the Toolbox, Prob. & Prop., March-April 2010, at 13.
One limitation of the TOD Deed -- it cannot be used with a class of people, i.e. "I leave my property to my children". Instead, actual names must be listed. Practically, this works best when only one person stands to inherit. Which leads to a second limitation, there is no room for contingency planning. While not perfect, it is a simple, and cost-effect alternative to the living revocable trust.

As always, it is best to consult with a lawyer specializing in estate planning and probate before acting.

Friday, March 5, 2010

Tax Time, Probates, and Personal Representatives

It's that time of year again, tax season. This year I am lending a hand to my mother, who is still grieving from my father's death last fall. Having a daughter who is also and estate planning attorney has been a great source of comfort for her. And a learning opportunity for me. And today I received an important reminder about death and taxes.

Going through her tax forms, I came across a 1099-INT for a bank and account that we did not know my father had an account with. Since his estate was completely non-probate, no probate was open. That is nice, because now we don't have to make any changes to an inventory. Lesson learned -- personal representatives should carefully review all 1099's coming in the name of the decedent. They just may uncover an asset that you did not find initially.

Wednesday, March 3, 2010

Interest Grows in Green Burials

Here is a quick USA Today article on green burials, which are growing in popularity.

A growing number of funeral directors are looking to add green services, says James Olson, spokesman for the National Funeral Directors Association. The Green Burial Council lists nearly 300 funeral homes that provide eco-friendly options, up from a dozen at the beginning of 2008, Sehee says.

Using a Disclaimer to Fund Spousal Trust

Routinely I have used a disclaimer to fund spousal trusts, and here is a great NY Times article on that very topic. Saying 'no thanks' to an Inheritance" does a very nice job of explaining the state of the estate tax and how a disclaimer trust works as well as its obstacles.