Yesterday, I talked with a woman from New Orleans about opening succession for her husband who died 5 years ago. She received some bad advice from a friend who told her not to worry about opening succession because it would be too much trouble. Now she has come to realize that she has limited access to a brokerage account shared by her and her husband, and she cannot redirect the investment of the money which is currently earning very little. In order to unfreeze this account, succession (a.k.a. probate) must be opened.In addition, she is also nervous about the nursing [...]

There is one misconception about tax law that I hear more than any other. Clients always tell me, “I heard if I give $14,000 to my kids each year, it will reduce the amount of taxes they have to pay when I die”. This statement is only true for families with large amounts of money. In fact, that statement only applies to .04% of families in the U.S. Under the current system, only estates over roughly $5.3 million for single people and $10.6 million for married couples will have to pay any estate taxes to the federal government. For Louisiana [...]

Clients are always looking to avoid the Louisiana probate process because it is often comes with a hefty price tag. When someone dies with assets titled in his or her name, the family must hire an attorney to prepare and file a complicated set of legal pleadings with the court in order to clear title to those assets into the names of the heirs. This court process is called probate or succession. The cost for probates in Louisiana is usually at a minimum about $5,000 because of the amount of legal work and court filing fees involved.Here in Louisiana, there [...]

This morning I met with a Metairie couple where each spouse was on their second marriage. The husband had 6 children from his prior marriage while the wife had 3. We created a Louisiana Revocable Living Trust for the family to avoid the potential for a messy probate where the kids on each side would fight it out for rights in each spouse’s estate.The couple wanted the husband's side of the family to get half of the trust and the wife’s side to get half of the trust. So instead of dividing the trust equally between all nine kids on [...]

Last week I met with a client in our Metairie office to make some changes to a Revocable Living Trust that she had established in 2001. The primary goal in establishing this Louisiana Living Trust was to avoid the court-supervised probate process (also know as succession) after each spouse’s death. As you’ve heard me say time and time again, avoiding probate can save your family thousands of dollars in probate expenses, months of delay, and a great deal of stress.My client and her late husband purchased this trust from a non-attorney financial advisor. When I met the client, we discovered [...]

Just yesterday, I encountered an issue that comes up time and time again when banks don’t understand the tax treatment of trusts where you retain income. A client in Mandeville who set up an irrevocable trust to protect assets from Nursing Home Poverty was getting pushback from their bank when trying to open a bank account in the name of their new trust. The bank was insistent that because the trust was an irrevocable trust it needed to use a separate EIN or Tax ID Number.The bank did not realize that whether the trust is irrevocable or not makes no [...]

If you own rental property here in Louisiana or you have friends with rental properties, you have probably heard that LLCs are a good way to protect you from lawsuits, but the question is why and how? I was talking with a former client from Metairie yesterday, and after setting up multiple LLCs for his multiple rental properties, he told me how few of his colleagues understand how Louisiana LLCs work to protect rental properties.The client told me that he sees so many people setting up just one LLC and lumping all of their rentals into a single LLC thinking [...]

Earlier in the week I met with a lady in Mandeville who posed the question, “If both my husband’s and my names are on all of our accounts, why do we need power of attorney for one another?” Well, the answer may surprise you.Louisiana Power of Attorney covers a whole lot more than the ability to perform banking and financial transactions for one another. If a loved one becomes incapacitated without a Power of Attorney in place, you will be unable to perform a number of vital functions for that loved one and will be forced to go through a [...]

Today I met with a couple from Destrehan whose biggest estate planning concern is to make everything as simple as possible for their family when each spouse passes away. Their primary assets are their home, a modest investment account worth about $150,000, and an partial interest in some rental properties in Jefferson Parish. In our discussion, we talked about the court supervised probate process that is required for all Louisiana residents that die with real estate and investments titled in their names, regardless of whether they have a Louisiana Will in place or not.As we discussed, two probates would be [...]

The other day I met with a lady from Raceland to help her set up a Louisiana Estate Plan that would protect her real estate, investments, and savings from being spent down on the cost of Long-Term Care. We are setting up a trust for the family that will hold ownership of the aforementioned assets, so that those assets won’t count against her eligibility to receive Medicaid to pay for long-term care should she need to enter a nursing home in the future. When Medicaid pays for long-term care, you are not forced to spend your own assets on the [...]