Posts by EllisKirkk:
Probate: Quick Ways to Protect Inheritance Property
September 20th, 2011Probate is a necessary requirement used to validate decedents’ last will and testament and distribute inheritance property to named beneficiaries. Probated estates are managed by an estate executor who is responsible for taking inventory of assets, obtaining property appraisals, paying outstanding debts, and distributing inheritance assets.
Probate usually requires three to six months to complete. If family disputes arise or heirs contest the Will, the probate process can last for years and bankrupt the estate with legal fees and court costs. Heirs who contest decedent wills are responsible for their legal fees. If a probate judge rules in favor of the plaintiff, the estate is responsible for reimbursement of legal expenses.
Inheritance asset protection strategies can be implemented to avoid probate. One of the most common strategies is to establish a trust. Property and assets transferred to trusts are not considered part of the estate and thereby avoid probate. Assets held in a trust are also exempt from inheritance taxes.
Trusts are overseen by an appointed Trustee. Individuals can designate their self as Trustee and designate a second Trustee to administer the estate in the event of their death. Legal title to property is transferred to the Trustee and held in the trust.
Trusts are typically reserved for estates valued over $100,000. However, strategies are available to protect assets for smaller estates. These include establishing transfer on death (TOD) and payable on death (POD) beneficiaries, as well as gifting.
TOD beneficiaries can be established for retirement, 401k, and financial investment accounts. Proceeds can be divided amongst multiple beneficiaries or transferred to one individual. For example, if you have three children and one sibling, you could arrange for each to receive 25-percent of the funds, or you could give 30-percent to each child and 10-percent to your sibling. With TOD, you control how much each beneficiary will receive. Beneficiaries do not have access to accounts until they have provided proof of entitlement.
Transfer-on-death can also be used to transfer titled property such as real estate and automobiles. Not all states allow TOD assignments for motor vehicles. If your state does not permit TOD, you can apply for a joint title and add the recipients’ name. Upon death, the beneficiary must take the title and death certificate to the Department of Motor Vehicles and transfer the vehicle into their name.
Some people gift their property while they are still alive to avoid probate. This strategy is often used by individuals who have been diagnosed with terminal illness. The elderly also prefer gifting inheritance property to loved ones; particularly when they move into an assisted living facility or nursing home.
Gifted property reduces the size and value of the estate and lowers probate costs. Gifting also ensures your loved ones will receive the inheritance you want them to have. Estate planning experts claim 80-percent of beneficiaries never receive a dime of inheritance when estates are probated. The IRS permits gifting of $12,000 per year to individuals and $20,000 per year to married couples. When gifting higher amounts, recipients must submit a federal gift tax return.
Probate is a time-consuming and costly task that can be avoided by engaging in estate planning. It is not difficult and only requires a few hours of time. Taking time to establish a plan now will save your loved ones time and money and reduce their stress during a difficult time.
Simon Volkov is an investor and probate liquidator who offers solutions to heirs needing cash for inheritance property held in probate. If you are an estate executor or beneficiary who needs to sell probate assets, visit www.SimonVolkov.com to arrange a complimentary consultation.
Probated: Tips For Keeping Inheritance Property Out of Probate Court
September 20th, 2011Probated refers to decedent estates held in probate court. Unless a person establishes a trust, everything they own must be transferred to probate court until their last will is validated and outstanding debts paid.
Probated estates are managed by an administrator named within the decedent’s Will. If the person died without a Will (intestate), a judge will appoint someone to handle estate affairs. Estate executors are usually a family member or close personal friend. In some cases, a probate attorney or estate planner will be appointed.
The probate process can take several months to complete. During this time, the probate personal representative must submit creditor letters and pay outstanding debts. If real estate is involved, the property usually transfers to the surviving spouse; if one exists.
Probate real estate can create financial burdens for the estate. If the decedent held a home mortgage loan the estate must continue making payments throughout the duration of probate. Property taxes and homeowners insurance must remain current. General maintenance, lawn care and repairs need to be addressed.
If the estate cannot afford to pay real estate related expenses, the probate executor can elect to sell the property. Estate administrators must have authorization to sell inheritance property and court confirmation is required in some states. If more than one heir is entitled to the real estate, each must agree to the sale unless ordered through the probate court.
Several techniques exist to keep estates from entering into probate. These range from establishing payable on death and transfer on death beneficiaries to establishing irrevocable trusts.
Payable on death beneficiaries can be assigned to bank accounts. All that is required is to fill out a form through banking institutions. Account holders can designate as many beneficiaries as they desire and can state what percentage of the money each beneficiary will receive.
Transfer on death beneficiaries can be assigned to financial portfolios, individual retirement accounts (IRA), 401k plans and life insurance policies. The process is the same as payable on death and requires providing names, addresses and social security numbers of named beneficiaries.
In most states, the probate executor will need to submit date of death value statements to the county tax assessor’s office. Each financial institution will provide date of death values. Tax assessor forms can be downloaded from state or county websites. Once the tax assessor signs off on the forms, inheritance proceeds can be distributed.
Establishing trusts usually requires the assistance of a professional estate planner. There are many types of trusts and each can be customized to suit individual needs. The two most common trusts include living trusts and irrevocable life insurance trusts.
Assets placed inside a living trust can include automobiles, real estate, art work, collectibles, jewelry and other valuable items. Estate assets are owned by the trust; not the decedent. Trust assets avoid the probate process and are automatically transferred to named beneficiaries upon the decedent’s death.
Irrevocable life insurance trusts include a contract used to administer the policy on behalf of named beneficiaries. The Will is placed inside the trust and inheritance assets are exempt from probate. Life insurance proceeds are exempt from inheritance taxes.
Death is never easy to deal with. Having to deal with probate after losing a loved one is a tragedy. One of the best gifts you can give loved ones is to take steps now to keep inheritance property out of probate.
Simon Volkov is a real estate investor and probate liquidator who offers solutions to estate administrators of probated estates. His comprehensive article library provides valuable information and resources about probate, inheritance, and estate planning. Learn more by visiting www.SimonVolkov.com.
Should You Hire an Adoption Consultant?
January 21st, 2009Times have changed in the world of adoption. Years ago couples went to their local adoption agency, filled out the paperwork and waited for their newborn. Today’s adoptions are far more involved, expensive, and difficult to negotiate. The whole process can be a scary and daunting proposition. That’s why many couples now turn to an adoption consultant for help and guidance.
Never heard of one? You’re likely familiar with a wedding planner who coordinates all the details involved in putting together a wedding. In a similar way, an adoption consultant serves as an advocate for adoptive parents. Consultants help the pre-adoptive parents navigate the maze, create a profile, and connect with the best agencies and attorneys for them. With a consultant, your adoption will most likely go quicker and be safer. Chances are you’ll also save money, have less stress, and probably sleep better at night
Just starting to consider adoption? This may be the best time to get involved with a consultant. The first step in approaching an adoption is a thorough and honest look at what’s involved and an assessment of whether adoption is a good decision for your family. Before you start the process, you need to know what you’re getting into, and have realistic expectations.
If you decide adoption is right for your family, there are a lot of decisions you need to make. Would you prefer a domestic or international adoption? Will it be an open adoption, closed, or somewhere in between? Do you want a newborn, or would you consider adopting an older child? There are pros and cons to each type of adoption and while some families are very comfortable with a fully open adoption or an older child, others prefer raising a newborn with less of a connection with the birth family.
Once you’ve narrowed the type of adoption you want, the journey truly begins. An adoption consultant can help you get started and work with you to put together a customized plan to help you through the process. You’ll learn about procedures, home studies, legal issues and the various levels of openness. A consultant can help you prepare for your interaction with birth parents and various adoption professionals and will work with you to put together a prospective parent profile. A great profile can make all the difference in how fast you’re selected by a birth mother.
Many couples pursue adoption after years of grueling infertility treatments that can leave them feeling frustrated and powerless. Those same feelings are often carried over into the adoption journey. Adoption is a whole new area that can seem overwhelming and even more uncontrollable than infertility treatments. A good adoption consultant can help prospective parents exert significant control over the domestic adoption process, especially the amount of time the entire process takes.
Throughout the journey, a consultant will be looking out for your best interests. Unfortunately, some couples are so desperate for a child they’re seduced by less-than reputable people or are pressured into accepting a situation that’s not right for their family. An adoption consultant will be supportive and will remind you that you’re not looking for any birth mother, you’re looking for the right birth mother. She and your future child are out there and a consultant can help you find each other.
Nicole Witt is Executive Director of The Adoption Consultancy, an unbiased resource serving pre-adoptive families. For more adoption information and resources go to http://www.AdoptANewLife.com or email info@theadoptionconsultancy.com
The Biggest Myths About Adoption
January 21st, 2009Most of what we know of adoption we get from the media or from our past. We see Angelina Jolie and Madonna adopting kids from around the globe. We remember adopted kids from our childhood neighborhood. But neither is a true picture of adoption today.
There are many myths and mistruths out there concerning adoption, and domestic adoption in particular. Families considering adoption need to know the facts in order to make an informed choice.
Myth #1 – Most Birth Mothers are Teenagers
When you think of adoption, do you picture the pregnant high school girl in the movie Juno? In reality, most birth mothers who choose adoption for their child are between 19 and 30 years old. Many are already single mothers who understand the realities and sacrifices involved in raising a child and choose adoption to give their child a better life. Adoption is a mature and loving choice and many birth mothers want an active role in their adoption plan.
Myth #2 – There are No Healthy Babies to Adopt in the U.S.
Tens of thousands of healthy newborn babies are adopted each year in the U.S – that’s as many, if not more, than the number of international adoptions. The myth that the only infants available for adoption in the U.S. are drug-exposed is simply false. Most women considering adoption for their child are not using drugs and are receiving prenatal care. In fact, babies placed for adoption are just as healthy as all other babies born in the U.S.
Myth #3 – The Adoption Process Takes Many Years
With domestic adoption, the timeframe is unpredictable because it depends on when you’re chosen by a prospective birth mother. Depending on the quality of the profile you create and how open you are to different situations, many domestic adoptions can be completed in only a few months.
Myth #4 – The Birth Mother Can Show Up and Ask for the Baby Back
If an adoption is done legally, through reputable attorneys and agencies, the adoptive parents have full parental rights as soon as the adoption is finalized. Before finalization, some states have a revocation period during which the birth mother can revoke her consent but adoptive families can assess the risks on a case-by-case basis before entering into an agreement. Other states don’t have any revocation period at all. Despite the publicity surrounding a few high-profile cases, post-adoption revocations are extremely rare.
Myth #5 – Closed Adoptions are Better (or Vice Versa)
Adoption isn’t a one-size-fits all arrangement. Some families do great with open adoption, while closed adoption is better for others. There are options available and varying levels of openness so each family can choose what type of adoption is best for them.
Myth #6 — Adopted Children are Emotionally Unstable or Have Behavior Issues
Research shows that adopted children are as well adjusted as their non-adopted peers. Some studies even indicate that adopted children are better adjusted due to the fact that adoptive parents tend to be mature and financially stable. As with all children, some are very talented or brilliant and some are less capable and have more factors pre-disposing them to potential difficulties. Most adopted people fall within the normal range.
Myth #7 – All Adoptions are Expensive
The cost of adoption varies greatly. Domestic adoptions can cost less than $10,000 and as much as $40,000. As an adoption consultant, most of the adoptions I see are of healthy, Caucasian newborns and the costs usually range from $25,000 to $35,000. Adopting an older child can be significantly less expensive and there are foster adoption programs in many states that can involve little, if any money. Starting in 2009, the government will offer new adoptive parents a tax credit of up to $12,150 that can help to significantly defray the costs.
These are just a few of the pervasive myths that often cloud the decision-making process for pre-adoptive families. There are many factors that go into a couple’s decisions regarding adoption. Fortunately, there are many resources and much support available to prospective adoptive parents to gain information and prepare them for the challenges and joys adoption can bring to their lives.
Nicole Witt is Executive Director of The Adoption Consultancy, an unbiased resource serving pre-adoptive families. For more adoption information and resources go to http://www.AdoptANewLife.com or email info@theadoptionconsultancy.com
Adoption- It’s Not What it Used to Be: What You Don’t Know About Adoption Today
December 1st, 2008There was a time, and not too long ago, when adoption was the only real option for couples that wanted a child but couldn’t conceive. Back then, the process was cloaked in secrecy and many adopted children went through much of their lives unaware of how they came into the family. Birth mothers relinquished their babies in the hospital knowing they were severing ties to the child forever. No one talked about it and many adoptive parents and birth mothers went to their graves with the secret. Luckily, adoption has changed dramatically over the years.
Infertile couples have more options to create a family than ever before. Intent on having their own biological children, many couples turn to medical interventions or surrogate mothers, and don’t seriously consider adoption until they’ve exhausted other options. Lingering perceptions, misinformation, and a general lack of understanding of adoption today can leave prospective parents wary of the process.
It used to be that couples wanting to adopt went to an agency, put their names on a list, went through an approval process and then were notified when a baby became available. The agencies matched babies with parents and the birth mother had no say, nor did she know where her baby was going.
Today, parents create a profile of themselves and birth mothers can choose parents for their children. While it’s empowering for a birth mother, it’s also made adoption more competitive, with couples vying for babies and trying to create the most compelling profile in order to be selected from the pool of prospective parents.
All adoptions used to be closed, meaning the records were sealed, even to the participants. Today’s adoptions are more open, with information shared between birth and adoptive parents. Experts have found semi-open adoptions are healthier for the child and allow access to important genetic medical history. While some couples and birth parents do opt for a fully open adoption, it remains a bit controversial. Proponents argue a child can’t have too many people loving him or her while detractors believe it can be too confusing.
Adoptions have always been expensive, but today they can be even more so. After spending thousands upon thousands of dollars on medical treatments, many couples come to the adoption process already cash strapped. When all is said and done, a typical adoption can cost about $30K, with some costing even more. However, many people are unaware that they may be eligible for an $11K tax credit when they adopt, which can significantly offset the cost.
Even the Internet has changed how parents adopt. The Web can be a useful research tool, but it’s also a dangerous place full of predators. While the Internet makes it easier to find good adoption resources and information from outside one’s local area, it’s also a haven for scammers looking to prey on vulnerable couples who are desperate for a baby.
Because of all the changes, costs and dangers, many of today’s prospective parents turn to adoption consultants for guidance. These experts can explain the differences between domestic and international adoptions and help couples put together a profile that’s more likely to get noticed by a birth mother. Consultants work for a fee, but in the long run their knowledge and contacts can save adoptive parents money and heartache. These experienced adoption professionals serve as advocates for prospective parents and can help them through a very stressful and emotional time.
Nicole Witt is Executive Director of The Adoption Consultancy, an unbiased resource serving pre-adoptive families. For more adoption information and resources go to http://www.AdoptANewLife.com