Turning a Blind Eye NowWill Blindside You Later Essential To-Dos
Howwould you feel if you accidentally gave your former spouse $30,000?
It actually happened. A client of mine reached out to informme his stepmother had passed away, but his stepmother and father had nothing in terms of estate planning. His father was quite ill, and it didn’t look like he was going to recover. After meeting with his father and preparing a living trust with all the supporting documents, my client watched his father sign the documents in his hospital room just two weeks before his father passed away. The good news is that we avoided probate on real estate and bank accounts. However, when my client went through his father’s papers, he discovered a life insurance policy dating back 30 years. But the policy beneficiary was listed as the father’s former wife of 20 years. She was still alive but living in a nursing home in Wyoming supported by state aid. So accordingly, the $30,000 benefit went to the state to reimburse them for providing care to this woman —most likely not what his father would have wanted. The moral of the story is clear: Check your beneficiaries! Double-checking your beneficiaries isn’t the only thing that should be on your to-do list. Taking five minutes to review some of those business or estate to-dos will save you and your family a lot of hassle in the future. Not doing this can obviously lead to some very disappointing results. For my living trust clients, the beginning of the year is an excellent time to review your documents. You may need to change your successor trustee or the named agents under your power of attorney. You may also need to update the beneficiary of your estate, which you can find in Article 6F of your living trust agreement. If you have bought any real estate that’s not in the name of the living trust, you will
If you have shareholders or a board of directors, then you are required to meet once a year and record the minutes of the session. If nothing significant has changed with the company, then a simple resolution needs to be added to the minute book. However, if you have acquired considerable debt, made management changes, and/or bought or sold assets, then you need to hold a session and record the minutes. I charge $300 to host the meeting and record the minutes. But if you have any questions or concerns, let’s talk over the phone to discuss your options. Don’t let 2020 get away from you. Take a few minutes to review all of your documents. Make sure they’re doing what they’re designed to do. If you find you need to update or make changes, call the office and set up an appointment. If you like the service I provide and have friends needing the same assistance, I always appreciate referrals. Happy Valentine’s Day and enjoy the beautiful Coachella Valley weather! Remember, you could always be living in aWisconsin winter like I used to until I discovered this place!
need to prepare a deed transferring the property to the trust and place the deed with your trust. If you have refinanced your property, it was likely taken out of your living trust but not put back in after the new deed of trust was recorded. If you don’t correct this now for minimal expense, it will cost about $3,500 to correct this problemwhen you die. All of your deeds and records can be found in the back of your trust documents book in a plastic sleeve. Have you retitled your bank accounts? Did you open any bank accounts not in the name of your living trust? If your financial accounts are not all in the name of the living trust, then you need to rectify that as soon as possible. I also can’t stress enough the importance of reviewing the death beneficiaries of your life insurance policies, your annuities, and your retirement plans. Small-business owners who have corporations or LLCs need to file a statement of information with California’s secretary of state. This is required once a year, and it’s easy to do online. If no significant changes have been made to your company, then check a box off on the government website, and you’re done!
-Robert L. Firth
FirthLaw.com | 1
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