Michigan Estate Planning Basics

May 20, 2009

Filed under: Elder Law,Estate Administration,Estate Planning,Health Care Directives,Holistic Estate Planning,Life Insurance,Living Trust,Living Will,Planning for Parents with Minor Children,Planning for Pets with Pet Trusts,Power of Attorney,Probate,Retirement Accounts,Will — Christopher J. Berry @ 8:56 pm

michigan-estate-lawyer.jpgIf have you ever dealt with a parent’s or loved one’s estate,  financial affairs or Michigan probate, you most likely know what a pain it is to administer their estate, clean up their affairs, and locate important documents and records.  I wanted to provide you some straightforward easily digestible advice on how make sure you don’t leave your loved ones in a lurch.

First and foremost, you must get organized.  You should begin creating a list of all your assets, liabilities, accounts, passwords.  Compile all of your records in one place and make sure they are safe and that your proposed personal representative, trustee, or whoever will handle you affairs when you pass, knows where to locate your documents.

The next step is to identify what your goals are with regard to when you become incapacitated or pass away.  Do you want to protect your assets in case you go into a Michigan nursing home?  Do you want to protect your children from poor financial choices with your inheritance?  Do you want to avoid the hassle, stress, cost of Michigan probate? Do you want to provide for your pets to be taken care of and not euthanized?  There are many difficult decisions to take into account.  We can provide you a list of some of the items to think about with regard to Michigan estate planning.  Just contact us using the contact form on this page.

Third, you need to select your team of advisors including your Michigan estate planning lawyer or Michigan elder law attorney.  Your attorney will assist you, along with your accountant and financial professional in matching the legal environment to your goals to create an individualized Michigan estate plan to meet your goals.  Through meeting with your Michigan estate planning professionals, you will have a Michigan estate plan that may include  living trusts, wills, general durable powers of attorney, health care powers of attorney, HIPAA authorizations and living wills.  Though Michigan statute does not recognize a living will.

Next, there should be a review of how your assets are titled.  For example, who is the beneficiary of your life insurance?  Should it be titled into the trusts or should the life insurance go outright to beneficiaries?  What about the IRA’s and 401k’s?  These are all questions and items that will be reviewed with your Michigan estate planning attorney and the rest of your estate planning team.

Next, it is important to speak with all of your family members about what decisions you made and how your Michigan estate plan will be implemented and how it will take effect.  If our clients are interested, we have a “family meeting” where we have our clients bring in any family members or children to answer any questions in a round table format so that all of the loved ones and beneficiaries are on the same page.

Last, you need to review your estate plan annually once completed.  There can be changes in your family situation, changes in Michigan or Federal law, or changes in the tax laws.  Any changes could have drastic effects on your estate plan.  We bring our clients in every year as a part of our Foundations program to ensure that their estate plan is just effective the day they signed there documents as it is the day the the documents take effect.

The key to Michigan estate planning is taking action.  You can’t wait until the day you need an estate plan to start thinking about estate planning.

-Christopher J. Berry, Esq.
Michigan Estate Planning Attorney

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How the Down Economy and Changes in Federal Estate Tax Effect your Estate Plan | Part 2

March 27, 2009

Filed under: Estate Planning,Federal Estate Tax,Holistic Estate Planning,Living Trust,Retirement Accounts — Christopher J. Berry @ 1:28 am

michigan-estate-lawyer.jpgYesterday at the Michigan Estate Planning Lawyer Blog I discussed two things to look for in your estate plan in this environment of a $3.5 million Federal Estate Tax Exemption and a down economy.  You can read that post here: Michigan Estate Planning Lawyer Blog.

Today we are going to cover three more items to consider in this estate planning legal environment

This down economy and economic crisis can increased the risk of bankruptcy, foreclosure, divorce, and law suits.  On top of this, your beneficiaries irresponsibility in financial management may also reveal it self since times are tight.  Now is a time to make sure that the spendthrift provisions in your revocable living trust (assuming you have a revocable living trust and want to protect your beneficiaries) are iron clad.

The next item to consider with the increase of the Federal Exemption is the need to rebalance trusts that try to minimize the effect of the Federal Estate Tax.  Typically a husband and wife will have a separate trust.  The goal being to stuff each trust up to the Federal Exemption amount, which this year is $3.5million.  Last year the exemption amount was only $2million, so there may be a need to rebalance the trusts.

One bright spot of the economic crisis is the opportunity for gifting.  Gifting is a way to reduce an estate value estate and gift tax free.   This year $13,000 can be passed gift tax free.  This is an increase of $1000 from last year.  Couple this increase with the 50% loss of value for many peoples portfolio and we now have a great opportunity to gift.

These are turbulent times for everyone.  You should sit down with your Michigan estate planning attorney to see how these changing times have effect your estate plan.

-Christopher J. Berry, Esq.
Oakland County Estate Planning Lawyer

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5 Things To Know About Naming Beneficiaries

March 20, 2009

Filed under: Estate Planning,Holistic Estate Planning,Retirement Accounts — Christopher J. Berry @ 1:41 am

One of the items we review with our clients are the beneficiaries on our clients financial accounts.  This is especially important for clients with Revocable Living Trusts.  If your beneficiaries are named incorrectly it can have drastic and costly effects on your Michigan estate plan.

Money magazine recently had an article on the 5 Things to Know about Naming Beneficiaries.  Their list included:

  1. Your will has no jurisdiction
  2. You can-and should- name a runner-up.
  3. Retirement accounts have quirky inheritance rules.
  4. Naming a minor is a quick ticket to Michigan probate.
  5. Changing a beneficiary is easier than changing the filter in your coffee pot.

If you have any questions on the article or what any of the items mean, contact us to review your beneficiary designations.

-Christopher J. Berry, Esq.
Bloomfield Hills Estate Planning Lawyer

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Penalties Waived for Mandatory Withdrawals in 2009

January 9, 2009

Filed under: Elder Law,Estate Planning,Retirement Accounts — Christopher J. Berry @ 7:00 pm

Typically upon reach the age of 70 1/2 you would  have to begin taking out your minimum required distributions out of your retirement accounts.  By retirement accounts I mean IRAs, 401(ks), and 403(b) accounts, all deferred taxation qualified accounts.

However, with the recently passed Worker, Retiree and Employer act of 2008, there is a one-year moratorium on the penalties so that retirees and older Americans will not be forced to take their withdrawals from these savings plans that have incurred dramatic losses with the state of the economy.

Continue reading “Penalties Waived for Mandatory Withdrawals in 2009″ »

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IRAs & FDIC Insurance

December 12, 2008

Filed under: Retirement Accounts — Christopher J. Berry @ 7:27 pm

There is quite a bit of misinformation out there regarding FDIC Insurance.  Unfortunately, some of this is coming from the bank staff themselves. This was a discussion topic amongst a national listserve of estate planning lawyers that I am a member of.

To clear up some misunderstandings, IRA’s are covered by FDIC insurance if the account is held at an FDIC insured institution.

Continue reading “IRAs & FDIC Insurance” »

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Murderer Cut Out of IRA Distributions

March 2, 2010

Filed under: Retirement Accounts — Christopher J. Berry @ 3:45 pm

In a recent PLR ruling from the IRS (PLR 201008049), the IRS ruled that the stepdaughter of a murder victim would not be penalized for failing to make minimum required distributions from the murder victim’s IRA during the criminal and estate proceedings. You can read more at Wealth Strategies Journal

Bloomfield Hills Estate Planning Attorney Prioritizes Details in Estate Planning

September 29, 2009

Filed under: Estate Planning,Life Insurance,Living Trust,Probate,Retirement Accounts,Will — Christopher J. Berry @ 8:36 pm

With the baby boomers aging, the largest amount of wealth in history is passing from one generation to the next. Unfortunately, people are procrastinating on their estate planning until it’s too late.

Over at the greenbaypressgazette.com, they have an interesting article that discusses how to prioritize the details in estate planning which you can read here:  “Guest column: Tim Cisler Prioritize details in estate planning.”

From the point of view of a Michigan estate planning attorney, there are a couple key points that I would like to reinforce from the article.

First, don’t underestimate the value of your assets.  Sure the economy is down, that said, your estate could include your residence, your retirement accounts, your savings, and possibly your life insurance.  Add all those pieces up and you may be surprised at the value.  Regardless of the size, you most likely would want to protect those assets from needless expenses, for example the expense of opening a Michigan probate.

The next key point is to keep your beneficiaries designations updated on your assets, including life insurance, retirement accounts, deeds to property.  Just because it made sense at one point to name a family member the beneficiary of the IRA, doesn’t mean now or in the future it would make more sense to name the living trust the beneficiary.

Lastly, know the difference between a probate estate and a trust.  People think that just because they have a Michigan Will, they will avoid the Michigan probate system.  Not true, a Michigan Last Will and Testament is your ticket to the Michigan probate system.  If you want to avoid a Michigan Probate, then a living trust would be a better option.

Christopher J. Berry, Esq., A Bloomfield Hills Wills and Living Trust Attorney, is a Partner with The Law Offices of Witzke Berry PLLC, which practices in the areas of Bloomfield Hills  Estate Planning, Bloomfield Hills Medicaid Planning, and Bloomfield Hills Probate Litigation, serving Metro-Detroit and Oakland County, Macomb County, and Wayne County.  We can be reached at 248-971-1700.

Michigan Estate Planning | What You Need to Know

June 3, 2009

Filed under: Estate Planning,Health Care Directives,Living Trust,Power of Attorney,Retirement Accounts,Will — Christopher J. Berry @ 8:46 pm

Michigan Estate planning often does not get the attention it deserves.  It is more exciting to talk about saving for your kids education, purchasing a second home, or deciding how to retire.  Unfortunately, ignoring what happens to your affairs when you pass away will not prevent the day from happening, regardless of the size of your estate.

The New York times had an interesting article on the matter, which you can read here.

Two important issues include:

  • Last Will and Testament.  Everyone should have a Last Will and Testament.  Your Will is a document that names guardians for dependent, minor children and can provide instructions to the probate court on how to distribute your assets.
  • Advanced Medical Directives.  Anyone over the age 18 in Michigan NEEDS to have prepare a patient advocate designation to appoint someone to make medical decisions if they are incapacitated.  Think of the Terri Schiavo case down in Florida if you need any reminder of what can happen if you don’t do this planning.

On top of these documents, other things to think about in estate planning are Trusts, Financial Powers of Attorney, and HIPAA Authorizations.  Also, don’t forget to look at how all of your assets are titled.

There is quite a bit that goes into preparing a comprehensive Michigan estate plan.  The sooner you start the process the better of you and your loved ones will be if something were to happen.

-Christopher J. Berry, Esq.
Bloomfield Hills Trust and Estate Planning Laywer


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