Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Friday, August 19, 2016

Proceeds Go to Named Beneficiaries Not Later Will Bequests

Life insurance1In Collister v. Feller, a Washington court of appeal concluded that a man who was named as his ex-wife’s beneficiary on her life insurance policy is not required to distribute proceeds to later beneficiaries named in her will. A testator can only direct the distribution of life insurance proceeds to be payable to the testator, estate, or personal representative. The ex-husband in this case was named as the personal representative, and the will was not eligible to direct proceeds.

See Julianne Tobin Wojay, Named Beneficiary Trumps Testator’s Later Bequest, Bloomberg, August 11, 2016.

Special thanks to Naomi Cahn (Harold H. Greene Professor of Law, George Washington University School of Law) for bringing this article to my attention.

August 19, 2016 in Estate Planning - Generally, Non-Probate Assets, Wills | Permalink | Comments (0)

Sunday, June 12, 2016

Life Insurance for Couples

Couples life insuranceWhen two people begin to build a life together, it is important to plan for the future and safeguard their assets as early as possible. Looking at the each partner’s goals can help advisors present appropriate options to meet their specific needs. If the couple is relying on both incomes, it is beneficial for each to retain a life insurance policy to rectify any loss. Additionally, couples with blended families need to create life insurance policies to cover all intended beneficiaries. Another useful strategy is an irrevocable life insurance trust, which are mainly used for wealthy couples that want to avoid taxes.

See Couples Insurance, Wealth Management, June 10, 2016.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

June 12, 2016 in Estate Planning - Generally, Estate Tax, Non-Probate Assets, Trusts | Permalink | Comments (0)

Friday, June 10, 2016

When to Update Life Insurance Beneficiaries

Life insurance beneficiariesGreat consideration goes into choosing who will be the beneficiary of a life insurance plan, but as life goes on, our initial intentions can change. This imposes the importance of continual review for your life insurance policy. When life changes occur, your life insurance beneficiaries should be reviewed to ensure they are still the best fit. Some common life changes that should key you into reviewing your policy are birth, adoption, change in marital status, and death. Group plans through employers also need to be reviewed as they are often forgotten about at these life stages. So, although it is important to review your beneficiaries at these times, it is good practice to consider about once a year.

See Brad Cummins, When to Update Your Life Insurance Beneficiaries, Investopedia, May 17, 2016.

June 10, 2016 in Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)

What to Consider After Establishing Your Estate Plan

Beneficiary designationsOftentimes, people think that they have completed their estate plan, but it is essential you take two last steps to ensure your assets are directed in the way you intended—examining your asset titles and beneficiary designations for life insurance and retirement funds. A study suggests that half of the assets passed in America pass by joint titling, beneficiary designations, and trusts. Joint titling and beneficiary designations will take precedence over wills for distributing assets. The Article further discusses the considerations for joint titling and beneficiary designations one must take into account when establishing their estate plan.

See Janet M. Colliton, Colliton: Retitling Assets Can Change the Estate Plan, Daily Local News, May 16, 2016.

June 10, 2016 in Estate Administration, Estate Planning - Generally, Non-Probate Assets, Trusts, Wills | Permalink | Comments (0)

Thursday, June 9, 2016

Executor of an Estate's Jobs

Making inventoryIt is the executor of an estate’s job to make an inventory for probate. With this job, the executor will be making sure all is in order before going in front of the judge, but it is important to review your state’s laws if there are specific requirements for probate inventory.

First, the executor must locate the assets, usually the most time-consuming part, and turn over the tally to the court. After locating the assets, the executor will need to categorize them, which allows the executor to term broad categories. During this process, the non-probate assets do not need to be accounted for because they pass outside of the estate. Next, the executor will need to value the assets at the fair market value. And finally, the executor has a duty to manage the assets prudently, setting them up for liability if their actions are negligent.

See Terry White, How To Make an Inventory for Court in a Probate Case, Houston Chronicles.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

June 9, 2016 in Estate Administration, Estate Planning - Generally, Non-Probate Assets, Wills | Permalink | Comments (0)

Wednesday, May 18, 2016

What Are The Alternatives To File And Suspend?

AgingThe popular file and suspend filing strategy for Social Security has been done away with by the Bipartisan Budget Act of 2015.  “The file and suspend option expired after Friday, April 29, 2016, and those who elect to delay receiving their retirement benefits will also no longer be able to request a lump-sum payment of delayed benefits if they elect to stop deferring their benefits.”  This article discusses some of the alternative claiming strategies that are still available for senior citizen couples wishing to begin or delay collecting Social Security benefits.  One strategy that still exists which this article discusses is the restricted application, but this will be phased out eight years from now and is only available to those who were at least 62 years old by the end of 2015. 

See Mark P. Cussen, Alternative Strategies to File and Suspend, Investopedia, May 18, 2016.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

May 18, 2016 in Elder Law, Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)

Tuesday, May 3, 2016

Harvard Law Professor Robert Sitkoff Gives Lecture On Estate Planning

Business_expenseHarvard Law Professor Robert Sitkoff made his contribution to the Last Lecture series with his March 29 lecture titled ‘Hope for the best; plan for the worst.’  This article provides a video of the lecture delivered by Mr. Sitkoff, who is an expert in trusts and estates.  “The Last Lecture Series, which is organized by the Class Marshals, asks popular HLS professors to give lectures addressing the graduating class.”  The main goal of the lecture was to discuss private law and to distinguish it from public law.  He discusses ways that the private law practice can be improved and how lawyers need to address their client’s concerns.  Another thing that he discusses is how law schools can work to improve the legal education that is provided to students to help get them more prepared for private practice.

See Raishay Lin, A trust and estates lawyer’s ‘last lecture’: ‘Hope for the best; plan for the worst’, Harvard Law Today, April 27, 2016.

May 3, 2016 in Estate Planning - Generally, Estate Tax, Income Tax, Non-Probate Assets, Trusts, Wills | Permalink | Comments (0)

Monday, May 2, 2016

Scenarios To Consider Before Making Social Security Decisions

Knowing social securityThis article provides important information that people need to know about Social Security.  People need to be aware of the fact that the full retirement age is changing, and this article offers a chart that shows the ages which the changes will effect.  The age that a person claims matters for how much benefits they will receive from Social Security, and the maximum age a person should start claiming is 70 or older.  The benefits that a person receives are based on 35 years of working.  It is also important for people to be aware of widow and survivor benefits.  Married couples should coordinate their Social Security planning with each other.  Being informed about Social Security techniques and when to claim can save people a lot of money.

See Casey Fleser, What You Don’t Know About Social Security Could Cost You, The Motley Fool, May 2, 2016.  

May 2, 2016 in Elder Law, Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)

What To Know About Cashing In A Life Insurance Policy

Life insuranceDuring difficult financial times people may need to have immediate access to a source of cash.  This article discusses the issues with cashing in a life insurance policy to meet immediate income needs.  “Cash-value life insurance, such as whole life and universal life, builds reserves through excess premiums plus earnings.”  There is a cash-accumulation account within the policy that holds these deposits.  “Learn the differences between these two types of insurance in Permanent Life Policies: Whole Vs. Universal.”  This article describes some of the consequences that can occur with cash-value withdrawals from a life insurance policy.  It also describes how most of the cash-value insurance policies permit people to borrow money from the issuer by using their cash-accumulated account as collateral.  People can also surrender (cancel) their policies in certain circumstances.  Finally, this article describes the life settlement concept. 

See David Rando, Cashing in Your Life Insurance Policy, Investopedia, May 1, 2016.

May 2, 2016 in Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)

Friday, April 29, 2016

Are All The Good Social Security Strategies Gone?

Social security mythsCongress has recently made many changes to Social Security.  This article wonders if there are any good Social Security strategies left that people can still use.  The file and suspend technique was done away with at the end of this month of April.  Another loophole being done away with is the “deemed filing” loophole which “allowed married couples to claim just a spousal benefit at their full retirement age, while allowing their own benefit to grow and accumulate delayed retirement credits until age 70.”  This article discusses some alternative Social Security strategies that married couples might be able to use.  “One strategy that could work well for married couples is to have the lower earner apply for benefits on time, while the higher-earning spouse waits and lets their own retirement benefit grow.”  There are also more policy changes that will likely be made in the future as congress attempts to fix Social Security funding issues. 

See Matthew Frankel, Did Congress Kill All the Good Social Security Strategies?, My San Antonio, April 29, 2016.

April 29, 2016 in Elder Law, Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)