Tag Archives: estate planning

Dear Liza,
 My husband and I are both in our mid-60s and both retired. We want to put a living trust together.  My husband has two daughters (and two grandchildren) from his previous marriage.  I have no children of my own, but have a sister and nieces and nephews.  My husband feels that his daughters should receive two-thirds of our estate, and my family (nieces and nephews) should divide the remaining one-third.  In your opinion, do you think this is fair?  I feel that I have contributed as much as he has over the years and that it should be a 50/50 split.  I hope you are able to give your opinion.  I can, and I will: I’m on your side, if you feel that you’ve each contributed equally to the property you’ve accumulated together during your marriage.  If you lived in a community property state, that’s how you’d have to divide your assets: 50/50.    But it’s not easy to discuss equity with a spouse, and he may feel that his children ‘deserve’ more somehow than your nieces and siblings.  Still, it’s worth working it out together so that your estate plan reflects your wishes, rather than state default rules, which will kick in if you die without a plan at all.   Maybe if you work with a compassionate and wise attorney (honestly, there are some….) he or she can help you two to articulate your views and come to a fair resolution.

Hi Liza,
I am about to create my Will and Living Trust.  My son has two sons and his wife is pregnant with twin girls.  I would like to know if I can name the twins in my Will/Trust now although they are not due to be born until December? I’ve written Wills that name children soon-to-be born. You could say that you want to benefit all of your son’s children, including the twins girls due in December. Or you could just say all of the children of your son that are alive at your death (which, unless you die before December would certainly include the new twins). Good luck!

Dear Liza: What is a reasonable amount to pay for a lawyer to do a living trust? Here’s my rule of thumb: you should probably start by assuming that the whole process will take about 10 hours of an attorney’s time. This should include a face-to-face initial meeting to thoroughly discuss your goals, your family situation, and your finanicial assets.  The lawyer should then draft your documents, you should review them, and there should be some back-and-forth over the drafts. Some lawyers do this in a second meeting, some do it by phone or by email. Ultimately, though, you should finalize the language and get back together to sign the documents. Included in my estimate, by the way, is that the attorney will also be preparing a Will, a Durable Power of Attorney for finance, a Health Care Directive, and assist you in transferring your real property into the trust. If you are single, you can reduce the estimate to 8 hours. Since lawyer’s rates vary a lot around the country, just take my ten hours and translate that into the going rate where you live: in Northern California, where I practice, you can spend between $3000 and $5000, but in other parts of the country in could be much less.

Of course, that’s my estimate for something rather straight forward. If you need to do any planning for a child with special needs, or for parents, or have a second marriage, or have complicated assets, it can take longer.

Dear Liza, My Wife and I own two pieces of real-property that we purchased long ago, in Los Angeles.  Because of Prop. 13, our property taxes are quite low. If we pass these properties to our children via a living trust, will they have to pay more property taxes? NO! I love being able to give you a simple, happy answer. But, you are in luck. By placing these properties into a living trust, you will be able to pass them to your children without a costly probate proceeding AND because you are passing properties from a parent to a child, they will inherit your property tax rate in both properties! The transfer of real property from parents to children is currently an exception to Property 13 reassessment. Your children will have to file a form requesting that this exception be applied to the properties within three years of the transfer, but unless the law changes in CA, they won’t be reassessed. For those of my readers who do not live in California, I apologize, this is a completely state-specific blog post. California passed Prop. 13 in the 1970″s, limiting the amount of property tax that’s assessed on real property until there’s a new owner, at that point, the property tax is applied to the then-current value of the property. However, parent-to-child is one of a few exceptions to this rule.