Cleveland Attorney

Why Estate Planning?

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Why estate planning?

Whether you find yourself with millions in assets, or merely hundreds, proper estate planning is vital.  Common objections to estate planning are limited resources and a feeling of morbidity.  The term “estate planning” may seem pretentious, and you may believe that you do not have an estate.  In reality, your estate is made up of your assets—your home, vehicles, life insurance, retirement, bank accounts, etc.

In addition, estate planning does not have to be morbid.  Instead, it is an opportunity for you to plan for the lives of those you care about most and to ensure that they have what they need to be successful and happy. Regardless of your situation, taking the time to meet with an attorney and plan your estate allows you several benefits:

  1. Providing for your family
    No one wants to spend time and money in probate court, yet that is exactly where many people end up because of a lack of estate planning. Wills are essential to ensuring that your plans and wishes are followed without delays and court costs.  And if you have children under 18, both parents should have a will naming guardians for those children.  Otherwise, the court will decide where your children will live and who will make decisions about their care.
  1. Designating beneficiaries or creating a trust
    For many assets, such as life insurance policies or tax-deferred accounts, you can assign a beneficiary, allowing your money to go directly to your designee. However, other assets, such as a bank account or property, do not allow a beneficiary to be designated.  Your will can designate your wishes, but the will does have to go through the court.  If you want to avoid probate altogether, one way is to create a revocable trust.  This minimizes expenses and leaves more for your beneficiaries.
  1. Choosing executors
    Executors (for a will) or trustees (for a trust) administer the assets of the estate. This is an important role, and this person (or persons) should not be chosen lightly.
  1. Planning for your care
    Making decisions about living wills, durable health-care powers of attorney, and/or funeral arrangements are all possible through estate planning. These decisions will allow for your wishes to be carried out, and they will relieve your family from having to make those decisions in moments of high stress and emotion.
  1. Review your plan
    State laws are specific on different aspects of wills and estate plans. If you have moved to a new state since making a will, you will want to meet with a legal expert to review the will and revise it as necessary.  You may also need to update executors, edit beneficiaries, or change guardianship for your children.

These benefits are only a general summary of the importance of estate planning.  In your particular circumstance, you may benefit from other avenues of planning as well.  For more information, or to speak with a lawyer, contact Baron Law at 216.276.4282 or send us an email at dan@baronlawcleveland.com.

Divorce Estate Planning Steps

Things to Consider When Getting Divorced

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If you’re thinking about getting divorced, you are probably up against one of the most challenging times in your life.  Cleveland divorce attorney Dan Baron has the following to consider:

  1. Selecting an Attorney – Can you get divorced on your own? Sure.  But why go through it alone.  Moreover, the laws are constantly changing and trying to represent yourself in a divorce proceeding might mean the difference between living a happy life, or never seeing your children or home again.  I always tell my clients that although I can probably handle putting some electrical or plumbing into my home, its not worth the risk of flooding my home or burning it down from an electrical fire.  Thus, I hire a professional to do the job.
  2. Property – In Ohio, property through a divorce proceeding is divided up among the spouses.  Notwithstanding a prenuptial agreement, property that occurred ‘during the marriage’ is divided up.  This may include retirement accounts, bank accounts, real estate, cars, boats and more.  Thank with a Cleveland, Ohio divorce attorney to learn more
  3. Children – There are several things to consider with children.  First, the State of Ohio determines who pays child support, not your attorney.  Child support is calculated by entering information into Ohio’s child support worksheet.  The worksheet will delegate who and what is to be paid.

For more information, contact Dan Baron at Baron Law, LLC.  Baron Law is a Cleveland, Ohio divorce law firm representing individuals and businesses.  Contact Cleveland, Ohio divorce attorney Dan Baron today at 216-573-3723.

Baron Law LLC

Estate Planning – Trends Following the American Taxpayer Relief Act.

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Estate Planning – Trends Following the American Taxpayer Relief Act.

A recent survey concluded that sixty percent of Americans are afraid they will outlive their retirement.   Thus, there has been a moving trend that people are more concerned about wealth preservation compared to wealth transfer.  For example, a fifty year-old man in the top income quintile in 1980 could expect to live 31.7 more years.  A fifty year old man in the top income quintile in 2010 could expect to live 38.8 more years.  At $75,000 per-year of spending, increased longevity creates an additional $532,500 in cost. Thus, estate planning methods have changed and the American Taxpayer Relief Act has adopted new laws conforming to the wealth preservation vision.

Up until recently, many estate planning attorneys would urge clients to include a trust in their estate planning package.  A trust is a good means to avoid creditors and shield assets from other liabilities.  However, because of the recent changes in the American Taxpayer Relief Act (“ATRA”), trusts are most often not necessary – even for the wealthy.   Pre-ATRA, an estate planning attorney would set up a trust with an amount equal to the deceased’s remaining exemption.  This is often called a “bypass trust,” or B or credit shelter trust.  Assets would often not be included in the spouse’s estate.  The balance would go to the spouse outright or to marital deduction (A) trust, eliminating tax after the first spouse dies.  In the end, these assets (plus any appreciation) will be included in the spouse’s estate.

Post-ATRA no changes the landscape for estate planning by offering several wealth preservation concepts.  First, the concept of “portability” means that the surviving spouse can add to his or her own exemption whatever amount of exemption the deceased had not used during their lifetime.  Thus, a bypass trust is not needed to avoid wasting the exemption.  However, the Deceased Spousal Unused Exemption Amount (DSUUEA) is not indexed for inflation.  In addition, ATRA now permanently sets the estate, gift, and generation-skipping transfer (GST) tax exemptions at $5 million and indexes that amount for inflation.  Therefore, in 2016 a married couple could avoid the gift tax for any amount less than $10,900,000.00 ($5.4 million x 2 for married couples).

People are living longer and the ATRA has adjusted for that.  For more information, contact Cleveland, Ohio estate planning attorney Dan Baron.  Call Baron Law LLC today.  You will speak directly with an attorney who will help you with your estate planning and tax planning needs.  Baron Law LLC is a Cleveland, Ohio law firm located in Independence, Ohio.