Posted by catherine jacobs on Thu, Jun 24, 2010 @ 09:50 AM
Many of us don't have a will. What happens if you die without a will?
Here is how your estate will be divided:
If you die without a will (known as dying "intestate") in Michigan, your assets will be divided amongst your immediate family. If you have a spouse but no children or parents, your entire estate will go to your spouse.If you have a spouse and parents but no children, the first $150,000 plus three-fourths of the balance of your estate will go to your spouse. If you have a spouse and at least one child, the first $150,000 plus one-half of the balance of your estate will go to your spouse. The remainder will go to your children.
If you have children and no spouse, your entire estate will go to your children. If you have parents and no spouse or children, your entire estate will go to your parents. If your parents are no longer alive, your estate will go to your siblings.
You don't always have to have a Will. Alternatives to a Will
Wills eventually become public after your death, with the details of what you owned and how much it was worth available to anyone curious enough to read the court file. As a result, many people look for more private ways to transfer their assets.
In Michigan, alternatives to making a will include:
- Life insurance policies or trusts
- Gifting cash or other assets before your death
- "Transfer On Death" ("TOD") or "Payable On Death" ("POD") bank accounts
- Holding assets by joint tenancy with right of survivorship ("JTROS"), with the assets transferring automatically to the other joint tenant at the time of death
- Holding assets through a tenancy in common, with each tenant having a divided interest in the property which can be independently sold
- Retirement plans and Individual Retirement Accounts ("IRAs")
- "Revocable living trusts" (sometimes called "grantor trusts"), giving all your assets to a trustee for management before your death
Making a Will
In Michigan, you can make a valid will if you are at least 18 years old and of sound mind. The will must be in writing and signed by you and two witnesses.
A Michigan lawyer who does a lot of estate planning can explain the consequences of some of the most basic choices you must make, such as whether property you want to leave to your minor children should be put into a trust at your death. For that reason, it makes sense to consult with a Michigan estate planning lawyer and have him or her draft your will, so that you don't make costly mistakes or accidentally not accomplish what you intended.
Putting together your estate plan is generally a simple process. At Dykema Law Offices, we can advise you on the best estate planning package for your circumstances.
Contact us today: dykemalaw.com or 616-363-6611
Posted by catherine jacobs on Wed, Jun 16, 2010 @ 09:34 AM
Who Needs Estate Planning?
Regardless of whether your estate is large or small everyone can benefit from estate planning. It's important for all of us to designate someone to manage our assets and make health care and personal care decisions for us when we become unable to do so for ourselves.
If any of the questions below seem relevant to you, then an estate plan is important for you and your family to pursue.
- Who will receive your assets after your death?
- Who will pay your last debts?
- Who will make health care decisions for you if you are unable?
- Does your family know your feelings when it comes to life support?
- Would you like any of your assets donated to charity?
- Do you know how to preserve your assets for your beneficiaries and reduce or postpone the amount of estate tax which otherwise might be payable after your death?
When individuals fail to plan ahead, a judge appoints someone to handle your assets and personal care. Your assets will be distributed to your heirs according to a set of rules known as intestate succession. Under intestate succession your assets may not be given to your choice of heirs. An estate plan gives you control over who will inherit your assets after your death. If the court has trouble locating your heirs after a period of time, your estate will escheat (be given) to the State of Michigan.
CATHERINE JACOBS, AT DYKEMA LAW OFFICES, CAN ASSIST YOU WITH ALL OF YOUR ESTATE PLANNING NEEDS. CALL TODAY FOR A FREE CONSULTATION.
616-363-6611 OR EMAIL AT: chj.dykema@tds.net
Posted by catherine jacobs on Tue, May 11, 2010 @ 08:50 AM
The Reality
We all know the statistics: 50% of all marriages will end in divorce. Many of these divorces (75% of men and women who divorce under the age of 45) will lead to second marriages and create blended families. Divorce statistic show that divorced men and women with children tend to remarry more quickly than their counterpart without children.
Putting everything in perspective
Many estate plans overlook or fail to consider estate planning issues for blended families. Issues that are often overlooked are disinheriting your ex-spouse, protecting your own children, providing for your new spouse, and considering the children of your new spouse. Top these issues off with the concern of tax savings and you can the need for careful consideration.
What to do with Your Ex-Spouse
First and foremost on most divorce couple's minds is: Will my ex-spouse inherit any of your money? Many divorced adults believe that they are protected as Michigan law automatically terminates an ex-spouses interest in your assets. Maybe, maybe not! What if your ex-spouse is designated in an employer provided life insurance policy? If you fail to act and change the beneficiary designation there is federal law which holds that the insurance policy should be administered according to federal law. Federal law would provide that the ex-spouse is the beneficiary, contrary to the state law.
Let's take it a step further
Without proper estate planning, in most cases, your ex-spouse (as surviving parent/guardian) would, likely, be appointed by the probate court to manage the inheritance you might leave to your minor children. So if you die without estate planning, before your ex-spouse, any inheritance you leave to your children will most likely be controlled by your ex-spouse.
One more painful step...
Assume that your children die before your ex-spouse. Who will inherit the assets your children received when you died? The answer is your child's next of kin--your ex-spouse.
Your New Spouse
Now you're remarried and have a new spouse. How does your new fit into the equation. Let's assume that you don't have a prenuptial agreement which provides for the separate maintenance of assets. Let's also assume that your new spouse is the beneficiary on your life insurance, bank accounts, etc. Now, assume that you predecease you new spouse. The result of this scenario is that your biological children could be forever disinherited. This goes on and on, for example, upon the death of your new spouse, most likely all the "blended assets" will be inherited by your step children, a replacement spouse, and subsequent children.
There is no right or wrong when it comes to estate planning. There is only "wrong" when you fail to plan. The new spouses must address planning so that they can carefully craft documents that will meet their estate planning needs as it relates to their newly created family dynamics.
YOU CAN PROTECT YOURSELF, YOUR NEW SPOUSE, AND ALL THE CHILDREN OF YOUR NEW FAMILY. YOU JUST NEED TO PLAN.
Call Dykema Law Offices to discuss your estate planning needs.
Posted by catherine jacobs on Wed, Apr 28, 2010 @ 02:03 PM
www.dykemalaw.com
Many people are receiving letters or postcards in the mail stating that you need to re-do your estate plan because of the newly enacted Michigan Trust Code.
The new MTC took effect April 1, 2010 in an effort to clarify the existing estate planning laws. The new MTC also was drafted to put all the trust law in one section of the Michigan Compiled Laws.
So, do you need a new estate plan?
If you already you have a revocable "living" trust, most likely you don't need to change your trust. It is only under unusual circumstances would a new trust amendment be required as a result of the MTC. Rest assured that the MTC was not enacted to render all previously drafted trusts useless or out-of-date. Nothing is further from the truth.
You will keep getting letters in the mail claiming that you need to have your trust changed because of the new MTC -- don't panic. Remember, however, that it is always a good practice to have your estate plan reviewed periodically. As your situation changes (guardian issues, death of fiduciaries, buying and selling of trust assets), you should made the corresponding changes to your trust.
We can evaluate your existing trust to determine if you need to amend your existing trust. If you're like most of us, you need to have a trust prepared or updated. Let us get it done today.
Dykema Law Offices -- Estate Planning Made Simple
Posted by catherine jacobs on Tue, Apr 13, 2010 @ 08:47 PM
Why do young parents need a Will?
In an Associated Press story reported online at http://sphere.com/, it become instantly clear why parents of young children should have a Will. The AP story reports on tragic car accident that instantly killed the parents, Karl Heiss and Marisa Bauducco-Heiss. Their 10-year-old daughter was left with with a catastrophic brain injury. Alden, the Heiss' 6-year-old son was injured, however, he fully recovered.
After the accident the Heiss' good friend, entrusted with their 7-sentence, 2 page holographic Will, brought it to the attention of the two sets of grandparents. The Will directed that Marisa's parents, who lived in the village of Ushuaia, near Terra del Feugo at the tip of South America, should have custody eleven months of the year. Karl's parents, of Malibu, California, would have the children one month of the year.
Disagreements about medical care were initially a problem. Language barriers made complicated matters even more. A custody battle ensued. The California judge upheld the terms of the holographic Will.
The story is worth reading. I strongly recommend reading this article, especially if you are a parent of a minor child. "After Crash, Kids Torn Between Nations."