California Family Trusts

What is a Revocable Living Trust?

2012-01-28T10:52:00.000-08:00

The essentials of a California Revocable Living Trust are covered in this video, including the benefits of trusts over wills in avoiding probate, which include cost savings, privacy, and avoiding time delays of the court system. The video is presented by CaliforniaFamilyTrusts.com and Orange County Estate Planning Attorney Dwight Edward Tompkins.

Family Trusts Avoid Probate

2012-01-20T16:04:00.000-08:00

Orange County Estate Planning Attorney Dwight Edward Tompkins explains the basics of Family Trusts and why you need one. Triggers that cause an estate to go into probate court are discussed. Details can be found at

Tompkins-Law.com

What is Estate Planning?

2012-01-16T13:44:00.000-08:00

Understanding that Estate Planning is more than just trusts and wills, but is a comprehensive process that may include financial, medical, business, and incapacity planning is basic to anyone interested in forming an estate plan. This video from CaliforniaFamilyTrusts.com and Orange County, California, Estate Planning Attorney, Dwight Edward Tompkins, is an essential introduction to Estate Planning.

Video: Estate Planning Basics

2012-01-06T07:49:00.000-08:00

Orange County Estate Planning Attorney, Dwight Edward Tompkins, explains family trusts and wills, and how they are used for estate planning in California. The advantages of family trusts are highlighted including probate avoidance, cost savings, privacy, and incapacity planning. Based in Orange County, Dwight Tompkins focuses on estate planning and family trusts.

DWIGHT EDWARD TOMPKINS,

ESTATE PLANNING ATTORNEY.

Tompkins-Law.com

Video: How Do I Become an Organ Donor?

2011-12-29T14:50:00.000-08:00

Presented by Orange County, California, Estate Planning Attorney, Dwight Edward Tompkins.

CaliforniaFamilyTrusts.com

Special Needs Trusts

2011-12-17T11:06:00.000-08:00

Presented by Orange County Estate Planning Attorney, Dwight Edward Tompkins.

CaliforniaFamilyTrusts.com

. This blog is intended is intended for informational purposes only and is not intended as a substitute for legal advice by a qualified attorney in your jurisdiction.

Video: My Mother Has Alzheimers, Is It Too Late For A Power of Attorney?

2011-12-10T10:05:00.000-08:00

Presented by

Orange County Estate Planning Attorney, Dwight Edward Tompkins.

714 385-0044.

CaliforniaFamilyTrusts.com

This blog is intended for informational and educational purposes only, and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

Video: Business Planning in California

2011-12-02T12:50:00.000-08:00

DWIGHT EDWARD TOMPKINS,

ESTATE PLANNING ATTORNEY.

Tompkins-Law.com

Video: Famous Estate Plan Follies: Marilyn Monroe

2011-11-25T10:36:00.000-08:00

Presented by Orange County Estate Planning Attorney, Dwight Edward Tompkins. This video demonstrates how the failure to plan results in unintended consequences.

Tompkins-Law.com

Video: Irrevocable Trusts

2011-11-18T12:12:00.000-08:00

Dwight Edward Tompkins,
Estate Planning Attorney.

California Family Trusts

Video: Famous Estate Plan Follies: Elvis Presley

2011-11-12T08:44:00.000-08:00

Presented by:

Dwight Edward Tompkins,

California Estate Planning Attorney.

Tompkins-Law.com

Video: Powers of Attorney

2011-11-05T08:49:00.000-07:00

Tompkins-Law.com

Video: Can I See My Credit Report?

2011-10-28T14:50:00.000-07:00

Tompkins-Law.com

Dwight Edward Tompkins

Estate Planning Attorney

This blog is intended for informational and educational purposes only and is not intended as a substitute for legal advice from a qualified attorney in your jurisdiction.

Video: Business Succession Planning in California

2011-10-01T13:45:00.000-07:00

The Best "Jobs Bill" May Really Be Trade Reform

2011-09-17T07:53:00.000-07:00

Food for thought:

"Foreign producers receive subsidies, tax abatements, free buildings, free energy. They do not pay taxes. They don't have to pay Social Security, workman's comp, disability or health care. They don't have to match a 401(k) contribution. They are able to avoid more than 100 years of of government regulations put on American businesses. OSHA does not exist in most developing nations. They use electricity that would never be allowed to be generated in the United States due to lack of pollution controls. The U.S. Environmental Protection Agency employs 17,000 workers. China's state environmental protection administration employs only 300."

R. McCormack, Manufacturing a Better Future for American (2009).

Economists Glenn Hubbard (Columbia U.) and Peter Navarro (U.C. Irvine) in their excellent book Seeds of Destruction make the case that the trade deficit is a major impediment to job creation in the United States.

According to Hubbard and Navarro's research, the trade deficit began in 1992, and beginning in 2000, it more than doubled in that decade of the 2000's.

Although one party touts government spending as the solution to jobs creation, and the other party wants to cut taxes, neither one has any plan to balance trade in the international economy.

Why is that?

DWIGHT EDWARD TOMPKINS
Estate Planning Attorney

California Family Trusts

This blog is intended as information only and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

Video: Prenuptial Agreements and Estate Planning

2011-09-03T12:14:00.000-07:00

Video: Understanding the Estate Tax

2011-08-10T15:31:00.000-07:00

Is The USA Hiding Bigotry Behind The First Amendment?

2011-07-27T15:07:00.000-07:00

Many of my clients and friends know that I took my undergraduate degree in Anthropology with an emphasis in Archaeology. In my reading and travels, I always pay attention to stories about antiquity and culture.

Recently I was in Scotland where I visited the world famous Roslyn Chapel. While there I learned that the Chapel had been defaced and the altar destroyed at the time when the majority of the country was turning away from Roman Catholicism to Presbyterianism, in an effort to erase the evidence that the chapel had been built as a Roman Catholic church.

Roslyn Chapel, Scotland:

While flying home from Scotland, I found an article in the July/August 2011 issue of Archaeology concerning the destruction of two massive statues of Buddha, 125 ft. and 180 ft. respectively in Afghanistan, blown up in 2001. They were intentionally destroyed by the Taliban government to remove the evidence of Buddhism that had stood since the first century A.D. at Bamiyan.

The now-empty niche at Bamiyan, Afghanistan:

In recent years, here in the United States, an assault on Christian symbols has been taking place, cleverly hidden behind a First Amendment argument. This argument supposes that a cross on hillside, that was erected over a 100 years ago by persons long deceased, will somehow create a state sponsored religion and thus violate the Establishment Clause of the First Amendment to the Constitution.

Often successful, these attacks result in the removal and destruction of these historical significant symbols from our culture.

The famous case of the cross on Mt. Helix in San Diego was brought by one person who was "offended" by a cross on a hill that had stood for decades, originally on private land, and then on government managed property.

Fortunately, the cross was preserved by a legal settlement that took it out of the government's care. I guess the idiot who brought the original case is still offended because it can be seen across the skyline to this day.

The Mt. Helix cross:

I believe that the law can be used to to impart justice, but it can also be the tool of zealots who have a bigoted agenda to carry out. We as a country, of course, don't think we are like the stupid bigots of 18th Century Scotland, or like those horrible Taliban extremists. But when we destroy our own cultural and historical icons, aren't we just like them?

Dwight Edward Tompkins
Attorney at Law

TOMPKINS-LAW.COM

This blog is intended for informational purposes only and is not intended as a substitute for legal advice from a qualified attorney in your jurisdiction.

DON'T END UP IN THE TWILIGHT ZONE OF INCAPACITY!

2011-06-18T08:25:00.000-07:00

Without a living trust and/or powers of attorney for management of finances and assets, you will end up in a "legal twilight zone" if you become incapacitated.

Even a Will cannot help you or your family if you are incapacitated, because a Will does not have any legal effect until you pass away.

A living trust and a power of attorney give authority to someone to act for you in case you are unable to act for yourself because you are incapacitated.

And, incapacity can last for years, essentially freezing your assets and finances. In those cases, the only alternative is for the family to file for conservatorship (i.e., a guardianship of an adult person) over you; an extremely expensive, time-wasting, privacy-invading, and emotionally draining court procedure.

In a recent case, my client's elderly parent became incapacitated due to advancing dementia. The parent had executed a living trust and powers of attorney, but had never given the family a copy. The family could not locate the parent's legal documents, but they knew the name of the attorney who had prepared them.

The attorney refused to give the family copies on the basis of attorney-client confidentiality, and since the parent was incapacitated, no permission could be given to the lawyer. The result was that the family was forced to go to probate court and file a petition for conservatorship.

Failure to intelligently PLAN in advance creates financial and management nightmares for your family; and puts you in a "twilight zone".

A comprehensive estate plan including a living trust, will, powers of attorney, and other planning documents put together by a qualified estate planning lawyer is the best solution to avoid the "twilight zone" in the future.

Dwight
Edward
Tompkins

Estate Planning
Attorney

Visit my website at:
CALIFORNIA FAMILY TRUSTS

This blog is intended for informational purposes only and is not intended and does not constitute legal advice; and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

NEW LIFETIME GIFTING RULES CAN REALLY HELP FAMILIES

2011-05-14T10:10:00.000-07:00

The new law signed by the President in December gives owners of family businesses probably the biggest tax beak to come along in many years.

That break is the lifetime gift exemption, now $5 Million, for the next two years (2011 & 2012); or $10 Million for a married couple.

While the estate tax amount has been increasing year to year, the lifetime gift exemption amount had stayed at $1 Million for more than 10 years.

If the current law "sunsets" on December 31, 2012 as it is scheduled to do, then the lifetime gift exclusion amount and the estate tax exemption will both decrease to $1 Million.

Even if you had previously used up your $1 Million lifetime gift tax exemption, now you can shift an additional $4 Million out of your estate to your family.

This two year window allows the owners of family businesses to transfer the stock in their closely held companies to the children or other family members and reduce the size of their estates, all tax free.

This strategy raises difficult questions for those now in charge as to how to maintain control and/or a stream of income from the company they currently work in and manage. How do they protect their interests and maintain their retirement while passing wealth down to the family?

Experienced estate planning lawyers can develop "salary continuation plans", "consulting agreements", and other legal mechanisms to protect the owner's financial stake in the family company.

Other difficult questions include how to treat other beneficiaries fairly when only one of the beneficiaries is going to eventually lead the business.

This may mean an amendment to the estate plan. The timing, nature and size of the gifts have to considered in the context of the overall estate plan.

Time may be of the essence in view of the fact that the $5 Million lifetime gift exclusion may disappear at the end of 2012, and go back to $1 Million.

Please contact me if this is a strategic area you are considering in your estate plan.

My website:

CALIFORNIA FAMILY TRUSTS

DWIGHT EDWARD TOMPKINS
Estate Planning Attorney

This blog is intended for informational purposes only and is not intended as a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

THE ESTATE TAX AND STUPID LAWYERS

2011-04-24T06:04:00.000-07:00

Last year, a lawyers group, Wealth Counsel, conducted a survey of estate planning lawyers from all over the US. I participated in the survey.

63% said they opposed repealing the estate tax. 32% said they supported taxing "beneficiaries who did not earn their wealth", and argued that not taxing the family inheritance "could create generations of individuals who stand idly by without being productive members of society". (A Look Inside The Estate Planning Industry: Key Findings From the 4th Annual Industry Trends Survey)

While there are some reasonable arguments in support of the estate tax, the arguments above are just plain stupid.

What they are saying is that they think your family shouldn't get your inheritance because your family didn't earn it.

Well.... the government didn't earn it either; so why should it go to the government?

Are they looking out for their clients?   It doesn't appear so.

In my experience, all of my clients, poor or wealthy, want to give their estate to their families.

If that natural and universal objective is repugnant to 2/3 of the estate planning attorneys out there (assuming the survey is accurate), how can they faithfully go about advising their clients on tax avoidance in estate planning?

I have no problem helping my clients protect their family through their estate plan.

Who gets to decide whether the family deserves the client's inheritance? It's not for me as the lawyer to decide that; that's the client's decision.

Being a lawyer is about jealously advocating for your client's legal rights, not about inserting your political views onto your client's motives.

Finally, many of my clients who have businesses commonly have the family working in the business itself. Mom and Dad have often retired, and its the kids and grandchildren who are running the business. Sometimes, making it more successful than their parents. Wouldn't they deserve to get the family business in the estate?

The bottom line is that estate planning attorneys should be advocates for their clients, not for the government, or others.   It is the clients goals and objectives that should be front and center in the representation of the client.

For more information about estate planning, including estate taxes, please visit my website at:

TOMPKINS-LAW.COM

Dwight Edward Tompkins
Estate Planning Attorney

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

10 PHONE CALLS TO MAKE AFTER THE DEATH OF A LOVED ONE

2011-04-20T08:31:00.000-07:00

When a family member passes away, there are several phone calls to make. In each case, follow-up calls, meetings, and paperwork will probably be required.

Also, the order of the calls may be different depending on the circumstances; however, the following list is a good general guide:

1. Funeral home
2. Family & friends
3. Veteran's office
4. The deceased's employer
5. Attorney
6. Social security office
7. Insurance company
8. Local newspaper
9. Credit card companies & utilities
10. Banks

For more information, please visit my website:
TOMPKINS-LAW.COM

Dwight Edward Tompkins
Estate Planning Attorney

This blog is intended for informational purposes only and is not intended as a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

WILL YOU BE PREPARED WHEN THE FAMILY "HOARDER" DIES? (Part 3)

2011-04-09T13:58:00.000-07:00

In concluding our 3 part series on hoarders, this final installment lists some of the dangers, both physical and emotional in combing through the family hoarder's home.

Some of these items involve proper removal and disposal:

Firearms
Ammunition, live and vintage
Pornography
Child Pornography
Drugs
Drug labs and materials
Hazardous materials such as paints, solvents, cleaners, etc.
Mercury
Carcinogens such Benzene, Toluene and Asbestos
Expired canned food

Exploded cans of soda

One CPA reported that he worked on an estate of a pathologist who had samples of his favorite diseased kidneys, gall bladders, and other body parts at his home as specimens in a collection.

Ventura County Environmental Health Officer, Greg Smith observed: "Hoarders have often become subjects of significant hazardous waste cleanups. A local Environmental Health or Fire Department can provide guidance for proper handling and disposal; in addition, State or Federal Superfund accounts may provide financial assistance."

Families have to be careful about the handling and reporting of illegal materials such as drugs and child pornography, as these materials are evidence of a crime.

Interestingly, one accountant stated that the family of one hoarder sold his porn collection on eBay in the adult section, and "made double [the] cleanup fee on stuff that the family originally just wanted to toss out".

These kinds of situations require not only the attorneys and accountants, but appraisers, environmental health, fire, police, and clean up specialists to be involved at different levels depending on the situation.

TOMPKINS-LAW.COM

Dwight Edward Tompkins
Estate Planning Attorney

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

YOGA TO THE WORLD: How Many Calories Do I Burn Practicing Yoga?

2011-04-01T20:51:00.000-07:00

YOGA TO THE WORLD: How Many Calories Do I Burn Practicing Yoga?: "'Is yoga a good workout?' I hear this question all the time. What I really think people are asking is “How many calories can I actually burn..."

HOW MUCH DOES ESTATE PLANNING COST?

2011-03-28T08:29:00.000-07:00

It really depends on your individual circumstances, particularly the complexity and size of your estate.

Most estate planning lawyers charge a flat fee, also known as a fixed fee, to prepare an estate plan, whether it is a basic will or a complex plan with a living trust with other necessary documents required to achieve your goals and objectives.

Fees vary from lawyer to lawyer. Unfortunately, some people look to non-lawyer sources for a "cheap trust", such as online websites, or so-called non-attorney "estate planners". These sources are prohibited by law from giving legal advice, so the documents they provide are only rudimentary boilerplate paperwork in which they fill in your name.

These non-lawyer sources charge hundreds of dollars for their services, and the savings are often small compared with the superior services that would be provided by a qualified estate planning attorney.

When contacting an estate planning attorney, ask them how many years of experience they have in estate planning. Ask what percentage of their practice is devoted to estate planning versus other areas of the law.

It is difficult for an attorney to quote a fee without carefully looking at all of the facts involved in the estate plan, however, they should be able to give you an idea of the range of fees.

Be sure to ask about future amendments and fees for those legal services.

Being informed is a key step in retaining an attorney; however, the most important element is hiring an experienced and qualified estate planning lawyer that not only can assist you in setting up the estate plan, but is there for you when you have questions or changes in the future.

Be sure to visit my website TOMPKINS-LAW.COM

Email me if you like to come in for an appointment detlaw@juno.com

Protect yourself and your family through affordable and personalized estate planning.

Dwight Edward Tompkins,
Estate Planning Attorney & Legal Blogger

This blog is intended for informational purposes only and is not intended as a substitute for legal advice from a qualified estate planning attorney in your jurisdiction. Reading this blog does not create an attorney client relationship between the reader and Attorney Dwight Edward Tompkins.

WILL YOU BE PREPARED WHEN THE FAMILY "HOARDER" DIES? (Part 2)

2011-03-06T17:50:00.000-08:00

In Part 2 of this series, we will look at a partial list of where money, important documents, and other valuables are hidden in the house.

Families who are pressed for time to rummage through all of the decedent family member's accumulated things, often become frustrated and begin to throw things away without taking a closer look.

Here is a partial list of places you should look:

Socks
Books
Shoes
Taped under dresser drawers
Aprons
Under the dining room table cloth
Under plant holders
Drapery hems
Toilet tanks
Bra Cups
Freezers
Under shoe liners
Cannisters
Back of cupboards
On top of basement ductwork
Taped to the back of art hanging on the wall
Empty cans in the pantry
Inside "trap doors" in the floor
Inside hollow bed posts
Jacket pockets
Inside the pages of old magazines
Fine jewelry mixed in with cheap costume jewelry

The list could go on and on. But the rule of the thumb is to be careful and smart. One story I heard concerned a man who had several new pairs of shoes in his closet. The family never knew the man to ever wear new shoes. So, guess where the money was hidden?

In our final Part 3, I will discuss some of the hazards of dealing with sifting through the property of the deceased family hoarder.

Dwight Edward Tompkins

Estate Planning Attorney

CALIFORNIA FAMILY TRUSTS

This blog is intended for informational purposes only and is not intended as substitute for legal advice from a qualified attorney in your jurisdiction.

WILL YOU BE PREPARED WHEN THE FAMILY "HOARDER" DIES? (Part 1)

2011-02-13T16:50:00.000-08:00

Do you have a "hoarder" in the family? Someone who collects everything and throws nothing away?

The task of going through everything is daunting. The temptation is to call 1-800-Got Junk and have them pick up everything.

Don't do it!! At least not just yet. Here's some stories by estate attorneys and others that will blow your mind.

New York City Appraiser Peter Curran tells of going through a house "stacked to the ceilings with stuff. Under the #@&%, however, was several important 18th Century antiques and a couple $Million worth of stock certificates".

Detroit CPA Sean Lane writes "I found with one client over $18,000 in various places...But the most distressing, is the loaded firearms that I found in places you would never think to look at twice....Expect the unexpected in any hoarding situation."

The best story related to me by another attorney is the story of Lavere Redfield who died in 1976 in Reno, Nevada. Hidden in his house in Reno were 407,596 silver dollars worth not less than about $27 each at today's silver prices.

On behalf of one client, I tracked down $36,000 in a brokerage account that no one knew about, by calling a phone number on a paper found by the family.

In another case, my client found $30,000 stuffed in socks in the sock drawer.

In Part 2 of this series, I will give you a partial list of hiding places known to attorneys, appraisers, and others where "hoarders" hide the goodies.

DWIGHT EDWARD TOMPKINS

Estate Planning Attorney

Please visit my website:

CALIFORNIAFAMILYTRUSTS.COM

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

VIDEO: LIVING TRUST FAILURES: COSTLY MISTAKES TO AVOID

2011-02-10T18:24:00.000-08:00

RISKS OF PORTABILITY UNDER THE NEW ESTATE TAX LAW

2011-01-29T13:29:00.000-08:00

Under the new Estate Tax law, surviving spouses have a "portability" right when their spouse passes away. The survivor can elect this "portability" in the 706 Estate Tax Return. The advantage of the portability is the use of the unused portion of the deceased spouse's exemption if they pass away in 2011 and 2012.

This could be helpful especially if the exemption amount is severely reduced in 2013; an event that is very possible.

There are risks, however, one of which is remarriage. For example, if Dick and Jane are married, and Jane passes away, but only $1M of her $5M exemption is used; then there is an unused portable credit of $4M.

Dick remarries Alice, who also predeceases him. If Alice leaves a $1M unused portable credit, then Dick only has the $1 million of unused portable credit of his second wife, not the $4 million from his first wife.

It is questionable as to how frequently this series of events would occur.

The use of portability requires the filing of a 706 Estate Tax return, something that many surviving spouses would not have had to bother with in prior years. But, the option will have to be considered for decedent's estates over the next couple of years.

DWIGHT EDWARD TOMPKINS
Estate Planning Attorney

TOMPKINS-LAW.COM

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

NEW ESTATE TAX LAW - WHAT IT MEANS TO YOU

2011-01-19T17:09:00.000-08:00

Last month, the President signed into law the "Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010.

The new law reinstates the estate tax, but sets the exemption amount at $5 Million, and sets the maximum tax rate at 35%.

If the law had not been enacted, the EGTRRA (Economic Growth and Tax Relief Reconciliation Act of 2001) would have expired on December 31, 2010; in 2011 the exemption amount would have been $1 Million with a cap of 55%.

The most interesting part of the new law is the "portability rule" which allows a surviving spouse to use the unused portion of their deceased spouse's credit.

For example, if the deceased spouse passes away in 2011 or 2012, and uses only $2 Million of their $5 Million exemption; the surviving spouse can file a 706 Estate Tax Return and elect portability of the unused portion of the credit; in this example, $3 Million, and add to his or her $5 Million credit.

Because of the danger of the law expiring on December 31, 2012, and reverting to the draconian $1 Million exemption amount; estate planning lawyers are likely to have surviving spouses' file the 706 and elect the portability to offset the chance of the higher estate tax on their future death.

The new law gives some breathing room to middle class estates, small businesses and family farms with illiquid assets.

What happens in 2013 beyond is anyone's guess. I suppose Washington can't think that far ahead.

But you should, and protect yourself and your loved ones.

DWIGHT EDWARD TOMPKINS
Estate Planning Attorney

TOMPKINS-LAW.COM

This blog is intended for informational purposes only, and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

Personal Service Is My Standard

2010-12-27T15:17:00.000-08:00

I have just completed my 20th year of practice in Estate Planning, Business Planning, and Estates: 19 years as a solo practitioner. Unlike larger firms, I personally work directly with my clients, which allows me to provide a more affordable, cost-effective approach to solving their planning needs. Through this approach I understand my client's unique circumstances, and design a plan to specifically address the client's objectives. After working with me, clients understand the process fully and are equipped to make the best decisions for themselves and their family.

In 2011, clients will see new opportunities with the change in the tax law for estates. For more information on Estate Planning, please visit my website at TOMPKINS-LAW.COM

Dwight Edward Tompkins
Estate Planning Attorney

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

MERRY CHRISTMAS

2010-12-18T09:36:00.000-08:00

MERRY CHRISTMAS

CALIFORNIA FAMILY TRUSTS

Dwight Edward Tompkins

Estate Planning Attorney

TOMPKINS-LAW.COM

VIDEO: PRESIDENT KENNEDY'S ECONOMIC AND TAX POLICY

2010-11-23T12:27:00.000-08:00

President Kennedy's policy of tax cuts to stimulate the economy. He argues that tax cuts will increase federal revenues. Interesting.

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is for informational purposes only and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

VIDEO: QUANTITATIVE EASING EXPLAINED

2010-11-22T11:08:00.000-08:00

A fun and educational video on economic and monetary issues. Enjoy.

Dwight Edward Tompkins

Attorney at Law

This blog is intended for informational purposes only and is not intended to be a substitute for legal advice from a qualified attorney in your jurisdiction.

VIDEO: ESTATE PLANNING: COMMUNITY VS SEPARATE PROPERTY

2010-11-19T12:23:00.000-08:00

DWIGHT EDWARD TOMPKINS

Attorney at Law

TOMPKINS-LAW.COM

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

WATCH OUT FOR THE JURY DUTY SCAM

2010-11-05T10:31:00.000-07:00

Your phone rings, you answer, and the caller identifies himself as an officer of the court.

You are told that a warrant has been issued for your arrest for failure to respond to a jury duty summons.

You tell the "jury duty coordinator" that you never received the notice.

The so-called court official asks you for your Social Security Number and date of birth, your address, and the proper spelling of your name, so he or she can verify the information and cancel the arrest warrant.

The jury duty scam is a simple variation of the identity-theft ploys used in recent years to steal personal information. This scam is particularly effective because the victim is caught off guard, and put into fear of being arrested by the authorities.

With this scam and others, protecting yourself is key:

NEVER GIVE OUT PERSONAL INFORMATION WHEN YOU RECEIVE AN UNSOLICITED PHONE CALL.

Ask for the name of the person calling, and then hang up!!!!

Call information or look up the court jury coordinator phone number on the internet. Call the court and check the so-called jury duty summons status.

Don't call the number given to you by the scam caller.

Be smart and protect yourself.

DWIGHT EDWARD TOMPKINS
Attorney at Law

TOMPKINS-LAW.COM

This blog is intended for informational purposes only and is not substitute for legal advice from a qualified attorney in your jurisdiction.

DID GLORIA ALLRED VIOLATE HER ETHICAL DUTIES?

2010-10-11T12:01:00.000-07:00

Forget the political and media implications of the Gloria Allred press conference with her client, Ms. Diaz Santillan recently held.

What is truly fascinating, at least to me as a lawyer, is the apparent ethical violations of Gloria Allred to her client.

Attorney Allred put her client on national television, making her a nationally known figure, both in name and in image.

She apparently prepared a written statement and instructed her client to read this statement on national television.

In the written statement read to millions of people, the client admitted to: (1) being an illegal alien; (2) commiting identity theft (using someone else's social security number); and possibly fraud (falsified work application).

Attorneys are to act in the best interests of their client. My question is very simple: How is it in the best interest of Ms. Diaz Santillan to have her admit publicly to having committed crimes?

Not only did she expose Ms. Diaz Santillan to possibly criminal investigation and prosecution, but she also made her unemployable! What employer will ever hire this poor woman? Again, how was this in the best interests of her client?

An attorney owes the client a duty of confidentiality, that is to keep secret any communications that the client confides to the attorney. An attorney is to act competently, and to avoid conflicts of interests between the client and themselves.

And an attorney must always act in their representation of a client in a manner that advances the best interests of the client.

Maybe I'm wrong, but serious ethical violations seem to have occurred in this case. How the client is and will be harmed will play out in the future.

And that's my opinion...

Dwight Edward Tompkins
Attorney at Law

This blog is intended for information purposes only, and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

WHY PRENUPTIAL AGREEMENTS ARE IMPORTANT IN ESTATE PLANNING

2010-09-17T13:35:00.000-07:00

A prenuptial agreement sets out the property rights between the partners to a pending marriage, i.e., what will be their community property (what they own together), and what will be their separate property (what one of them owns separate from their partner).

Because California is a community property state, a prenuptial agreement makes it clear what their legal rights are vis-a-vis the property, and if one of the partners in the marriage passes away, the rights of the survivor can be clearly determined.

A well-written prenuptial agreement lays a foundation for the preparation of a living trust or family trust: The trust can then set forth what the estate consists of, and how the specific assets are to be distributed on the death of one of the partners.

Using a prenuptial agreement in combination with an estate plan such as a living trust or family trust is commonly used in second or third marriages, where the couple each has children from a prior marriage who they wish to protect and benefit in their respective estate plans.

Also, first time marriages where one of the partners is a co-owner in a family business is another common situation where a prenuptial agreement can be helpful.

Prenuptial agreements are not for everyone, but in certain cases, combined with a well-crafted estate plan, it protects the various family relationships that are involved.

For more information please visit my website at:

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

HOW SHOULD I PROVIDE FOR MINOR CHILDREN?

2010-09-03T09:25:00.000-07:00

If you have minor children, you should have a will prepared and executed in which you nominate the guardians for the children in the event of your death.

Even if the size of your estate justifies the use of living trust (family trust), a will is essential for the nomination of guardians. (You may not nominate guardians in the living trust itself - only in a will.)

When choosing a guardian, you will want to nominate someone who is capable of raising minor children. For example, your 88 year old aunt, is probably not a good choice. You should also choose a guardian who has similar moral, ethical, and life style qualities as close to your own as possible. But remember, no one is exactly like you, so your choice of guardian will be the best choice, not the perfect choice.

You may also consider transferring assets to a custodian account under the California Uniform Transfers to Minors Act to be held for the child until he or she reaches age 18, 21 or 25.

Another option is to create a trust to be held, administered and distributed for the child's benefit until the child is even older. Trusts may be set up now when you are alive, or the will could require the creation of a testamentary trust to be set up by the court during the probate process.

The best approach is to talk to a qualified estate planning attorney and develop a comprehensive estate plan for not only the guardianship of the minor children, but also include the management and distribution of the assets, property, and money in the estate.

For more information please visit my website at:

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS
Estate Planning Attorney

This blog is intended for informational purposes only and is not intended as substitute for legal advice from a qualified attorney in your jurisdiction.

GRAND CANYON - NORTH RIM 2010

2010-08-25T09:07:00.000-07:00

HOW DO I PROTECT MYSELF IF I BECOME INCAPACITATED?

2010-08-04T11:43:00.000-07:00

An incapacitated person is deemed to lack legal ability to act; i.e., make legal decisions, sign documents, enter into agreements, etc.

There are 3 principal ways to protect yourself in the event of incapacity. The 3 protections are to execute (1) a living trust; (2) an Advance Health Care Directive with Power of Attorney for Health Care Decisions; and (3) a general and/or special durable power of attorney.

One of the benefits of a living trust is the nomination of a successor trustee who will manage the trust after your resignation, death, or incapacity. A trustee controls and manages a trust and its assets much like an agent with power of attorney. Both have a fiduciary responsibility to act on behalf of the trust's or power of attorney's creator. However, while a power of attorney expires upon the death of the principal (the one who created the power of attorney), a trust and its trustee continue postmortem in legal effectiveness.

An Advance Health Care Directive allows you to designate a trusted person to make medical decisions for you in the event that you become incapacitated. (Probate Code Sec. 4605, 4629, 4682). You can include detailed instructions regarding your future medical care, such as life-support treatment. The California Medical Association form is the one I recommend for use in this regard. It must be notarized or witnessed by two qualified individuals. A copy can then be given to the health care agent, alternate agent, your doctor, your health plan representatives, and family. And if you are admitted to the hospital, provide a copy to the hospital.

A durable power of attorney is a written legal document that gives another person the right and authority to act on your behalf. (Probate Code Sec. 4022) even if you are incapacitated. The power of attorney may be general, giving the agent broad powers, or it can be a special power of attorney giving the agent specific, narrow power. An example of a special power of attorney would be a form power of attorney for a specific bank that limits the agent's authority to specific accounts.

With all of the above decisions, appointing or nominating trustees or agents, be absolutely certain that the trustee or agent is both capable and trustworthy.

If you have any questions or would like more information about these or other estate planning subjects, please visit my website: TOMPKINS-LAW.COM

Dwight Edward Tompkins
Attorney at Law

This blog is intended for informational purposes only and is not intended as substitute for legal advice from a qualified attorney in your jurisdiction.

NO ESTATE TAX FOR STEINBRENNER'S $1.1 BILLION ESTATE?

2010-07-20T15:10:00.000-07:00

Yankee's owner, George Steinbrenner died on July 13, 2010 leaving his family an estimated $1.1 Billion Estate!

And, under the current 2010 tax law, his estate will pay NO ESTATE TAXES?

That's right! Congress and the President have not acted to change the tax code as many had expected. Now that we are into the 2nd half of the year, and with mid-term elections underway, it is very unlikely that the anticipated repeal of the 2010 estate tax law will happen.

While the Steinbrenner estate will not have to pay any estate taxes, the estate of the middle class American, who worked for wages for 45 years, who dies next year (2011) and leaves a house, a 401(k), insurance, and a small amount of money in a modest $1.5 million estate, will pay $275,000 in estate taxes.

The arbitrary and capricious nature of the death tax cannot be illustrated any better.

Despite the chaos caused by the tax law, it remains vitally important to have an estate plan.

The estate tax goes back into effect on January 1, 2011 with a $1 million exemption. The law is scheduled to "sunset" 12 months later. What Congress and the President will do is anybody's guess right now.

My video "When to Review and Amend Your Trust" explains how to know when it is time to amend your living trust. You can view the video by visiting my website at
TOMPKINS-LAW.COM
and click on the YouTube link on the homepage.

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

THE REALITIES OF OFFSHORE ASSET PROTECTION

2010-07-09T11:13:00.000-07:00

The days of moving money to an offshore account are gone --- The United States is the only industrialized nation that taxes its overseas citizens, subjecting them to double taxation: taxation in the US and in the country of residence.

The federal government has implemented tougher rules requiring expatriates to report foreign bank accounts exceeding $10,000, with stiff penalties for failure to comply.

Americans living abroad are often denied financial services because of the increasingly complex rules imposed on other countries by the US when dealing with expatriates.

The US Department of Justice (DOJ) is engaged in litigation against Swiss banks accused by the DOJ of helping wealthy Americans hide billions of dollars in Swiss bank accounts. To absolve itself of of criminal charges, UBS has agreed to pay $780 million in penalties and release the names of 250 clients the IRS suspects of evading taxes. Some much for bank-customer confidentiality.

In February, DOJ filed a civil lawsuit against UBS seeking the identities of 52,000 more Americans suspected of stashing a total of $15 billion at the bank. The next hearing on this case is set for August 3 to allow time for settlement.

DWIGHT EDWARD TOMPKINS
Attorney at Law

TOMPKINS-LAW.COM

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

DOING THE RIGHT THING

2010-06-21T15:31:00.000-07:00

As I head for trial starting next Monday in Los Angeles Superior Court defending a nonprofit corporation against claims made by former members, I am reminded of how important it is to "do the right thing".

Litigation always seems to me a gigantic waste of time, money and emotions.   And it makes me reflect on why I enjoy Estate Planning as the primary area of my legal practice.

Clients who carry out a well thought out Estate Plan are essentially doing the right thing. Estate planning is in reality an act of stewardship. Knowing that "you can't take it with you", motivates clients to consider their family and friends, and their assets, and then set in place a plan for the orderly transfer of those assets upon death.

Many clients after the execution of their Estate Plan will express relief and "peace of mind".   I believe they feel this way because they are "doing the right thing" for themselves and their family.

I think this is why I like the practice of Estate Planning.

TOMPKINS-LAW.COM

Dwight Edward Tompkins
Attorney at Law

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

ESTATE PLANNING BASICS

2010-06-16T11:14:00.000-07:00

VIDEO: ESTATE PLANNING BASICS: Everything you need to know about FAMILY TRUSTS and Estate Planning.

COSTA RICA -- PURA VIDA

2010-06-07T18:49:00.000-07:00

TOMPKINS-LAW.COM

THE GROWING PROBLEM OF ELDER ABUSE

2010-05-13T12:26:00.000-07:00

Elder Abuse is a growing problem due to the fact that Americans are living longer and the fact that many families are not prepared to handle their aging parent or family member.   This sometimes leads to abusive treatment of the aged by their own family members, caregivers, and others to whom the family entrusts their grandparent, parent, aunt, uncle, etc.

If you suspect that someone you know is being abused there are several anonymous and confidential ways to report this abuse. One option is to call the local Adult Protective Services (APS) agency, an agency found in California County Governments.

If the older person is a resident in a licensed long-term care facility, you can contact the long-term care Ombudsman. To find the local Ombudsman, call 1-800-231-4024).

Another option is to report the suspected abuse to the California Attorney General's Bureau of Medi-Cal Fraud and Elder Abuse Hotline at 1-800-722-0432; or contact your local district attorney's office.

An excellent publication is available for free from the California Attorney General's office at http://ag.ca.gov/  which provides further information.

Many people ask "Am I required to report suspected elder abuse?".   And the answer is yes, if you are responsible for the care of elderly person, whether you are paid or not.

Those who abuse the elderly are not always family members. They can be caregivers, a "new friend", a neighbor, or someone else with private access to the elderly person.

Common examples of elder abuse include (1) having the elderly person sign documents giving the abuser powers over or beneficial interests in the property of the older person; (2) stealing jewelry and personal property of the elderly person; (3) tricking the elderly person into home repairs or services that they don't really need; (4) slapping, hitting, and pushing the elderly person; (5) yelling, taunting, and verbally demeaning the senior; (6) stealing cash or emptying out bank accounts after the abuser has been added to the account; and (7) refusing to provide adequate food and hygiene, or mismanagement of medications.

Families need to constantly monitor the care and environment of their older family member.   The family's estate planning attorney can help with financial and incapacity plans to help safeguard the older person's assets and provide legal management of their assets and health care. The family physician should be consulted often for help in medications, and treatment; as well as determining the best residence for the older person.

A cooperative, family "team" approach with advice from the family lawyer and doctor will greatly reduce the opportunity for abuse of the elderly family member.

Additional estate planning resources are available for free at:

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

THE CONTINUING ESTATE TAX SAGA

2010-05-03T09:03:00.000-07:00

We still don't know where Congress and/or the President will go with the Estate Tax.

On February 2, Treasury Secretary Timothy Geithner and Senate Finance Committee Chairman Max Baucus (D-Mont.) said they support extending the 2009 estate tax rates to 2010.

This would mean a reinstatement of the estate tax, and that the exemption amount would be $3.5 million.

More telling, is that they stated that the tax would be retroactive to January 1, 2010.

Those who have been following this saga have always thought that any change in the law would be made retroactive to the first of the year.   Thus, my caution not to settle any decedent's estate this year on the belief that there is no estate tax on the estates of persons dying in 2010.

The inability to plan in this environment hurts the families of decedent's who are attempting to comply with the law while dealing with the death of their loved one.

"The Hill" reported in March that Senate Majority Leader Harry Reid (D-Nev.) and Minority Whip Jon Kyl (R-Ariz.) are working on "a fix", but so far their effort has failed to produce a consensus.

Fear of the November elections, and Congress' myopic view of legislation, may mean that nothing is done.

This would mean more problems in 2011 when the estate tax jumps back to 2001 levels that tax estates over $1 million, with a tax rate that tops out at 55%.

As "The Hill" reported: "This outcome makes lawmakers vulnerable to accusations of raising taxes....at a time of economic uncertainty."

I guess we'll just wait and see what they come up with next.

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS
ATTORNEY AT LAW

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

THE TRAGEDY OF A "BOTCHED TRUST"

2010-04-17T11:09:00.000-07:00

I am often asked to review and amend living trusts or family trusts that have been not been originally prepared by me.

Tragically, some of these turn out to be a "botched trust". A "botched trust" is a trust that will ultimately fail when the creator or creators of the trust pass away. In other words, a "botched trust" is a worthless piece of paper.

The most common example is the "unfunded trust". The person or couple has paid for a trust to be prepared, and they have signed it, but the all-important steps to fund the trust have not taken place.   There is no probate avoidance, because the assets have not been titled in the name of the trust. The trust is unfunded.

An example of the worst type of "botched trust" was recently sent to me by a friend of mine. His elderly mother, who lived up North, had paid someone to prepare her living trust. Not only was it unfunded, it had never even been signed.

This "unexecuted trust" had been prepared, placed in a fancy notebook, and given to the elderly woman who put it away thinking she had a trust. Inside the notebook my friend and I discovered the original trust document with "sign here" stickers on the execution pages. This lady in fact had no trust, just papers she had paid someone for, because the person who sold her the trust had not even bothered to oversee her signing of the documents.   And, of course, it was unfunded.

In every case where I come across unfunded trusts or unexecuted trusts, the trust was sold to the client by a non-lawyer.   These individuals who peddle these botched trusts often use the title "Estate Planner".

It is important to know there is a big difference between an "Estate Planner" and an Estate Planning Attorney!   Only an attorney can lawfully provide legal advice. An attorney has to comply with certain standards of competence that a non-lawyer does not.

An attorney should never use the title Estate Planner, instead the title of attorney or lawyer should be clearly used.

The bottom line: Know who you are dealing with --- If they are a lawyer, they will say so. If they are Estate Planner, know that you are not receiving competent legal advice, and you may be paying for a "botched trust".

Please visit my website for more information about Living Trusts, Family Trusts, and Estate Planning:

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational purposes only, and is not intended as substitute for legal advice from a qualified attorney in your jurisdiction.

THE IMPORTANCE OF FUNDING A LIVING TRUST

2010-04-07T08:02:00.000-07:00

Funding a living trust or family trust is a critical step in achieving the goals of the trust estate plan.

Failure to properly fund a trust will result in an overall failure of the trust itself to carry out its objective of avoiding probate, saving the family money and time, and making succession to the assets easy.

As a rule of thumb; real estate, tangible personal property, non-retirement bank-savings-credit union-brokerage accounts, stock and bond certificates, and book entry investments MUST GO INTO THE TRUST.

Retirement accounts, life insurance policies, small checking accounts, automobiles, and annuities do not go into the trust.

Unfortunately, after the trust is formed and initially funded, many clients forget about keeping the trust funded.

They will buy new real estate and fail to have it titled in the name of their trust. They will open new accounts, again failing to put the account ownership in the trust's name.

The unintended result will occur when the client dies, and the family is required to probate the real estate and/or accounts, inspite of the fact that they have a perfectly good trust set up.

If you have a living trust or family trust, you should review it every year and look carefully at funding. A good time to do this is at tax time because you are already getting out files and papers for review for preparation of taxes.

An annual review of your trust's funding is a critical step in keeping your trust active and effective.

Dwight Edward Tompkins
Attorney at Law

TOMPKINS-LAW.COM

This blog is intended for informational purposes only and is not intended as a substitute for legal advice from a qualified attorney in your jurisdiction.

Please visit my website for more information and resources on estate planning, living trusts, family trusts, wills, powers of attorney, trust funding, and other legal matters concerning estate planning and administration.

FAMILY TRUSTS AVOID PROBATE

2010-03-31T13:46:00.000-07:00

Check out Dwight' video:
"FAMILY TRUSTS AVOID PROBATE"
click on the link below to watch:
FAMILY TRUSTS YOU TUBE CHANNEL

Dwight Edward Tompkins
Attorney at Law

http://www.tompkins-law.com/

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

PET TRUSTS IN CALIFORNIA

2010-03-17T09:32:00.000-07:00

In 2008, California adopted a revised pet trust statute, which is found in California Probate Code Section 15212.

This law allows for you to include in your estate plan a provision that upon your death, a certain sum of money will be held by a trustee (that you appoint) in trust for benefit of your pet. A caregiver is also nominated to take care of the pet. The trustee and the caregiver may be the same person, or 2 different persons.

The nominated caregiver takes physical possession of the pet when you die, and the trustee provides funds to the caregiver as needed for the costs of the pet's food, veterinary care, and supplies.

A pet trust is a lawful trust, but is considered noncharitable; and "animal" is broadly defined in the law to include any domestic or pet animal.

The pet trust ends when the animal dies, and any funds left over are distributed to "remainder beneficiaries".

There are some requirements for accounting for large trusts, or if the trust document requires accountings, or if a court so orders an accounting.

If you interested in learning more about this topic or any other estate planning topics, please contact me:

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for information purposes only and is not intended as a substitute for legal advice from a qualified attorney in your jurisdiction.

Reprinted from original blog post on August 19, 2009; Dwight Edward Tompkins, Attorney at Law

CLIENT CONFIDENTIALITY: HOW DOES THAT WORK?

2010-03-11T10:18:00.000-08:00

As an attorney, I owe my clients a duty of confidentiality concerning infor-mation that they communicate to me.

In a court setting this duty is enforced under the Evidence Code through the Attorney-Client privilege.

One of the most common challenges for an estate planning attorney like myself is when I receive a call or email from one of the adult children of my client who is asking for information about their parent's estate plan or finances.

Unless the client has waived the privilege, that is, the client has specificly OKed me to speak with a particular family member or party, I have to refuse to speak to the adult child.

A client can waive the confidentiality a number of ways. One of the most common ways is when the client brings a family member with them to meet with me and they express to me their desire that the family member sit in and hear all of the discussion, and that it is OK for me to speak with that family member in the future.

A more formal method is to sign a "Release of Information" statement which goes into their file in my office. This allows me the ability to review the file to determine that the person calling me on the phone or emailing me is entitled to receive information about the client's estate plan, finances, and decisions.

It can often be very helpful for clients to allow the adult children to communicate with me and vica-versa, however, I need to be directed to so, otherwise the duty of confidentiality prevents me from speaking with the child.

When I am unsure, I will call the client and ask if I can return the call or send an email response.

It is a simple matter of letting your estate planning attorney know of your desires.

If you are interested in this subject, or other information concerning estate planning, please visit my website at:

TOMPKINS-LAW.COM

DWIGHT EDWARD TOMPKINS

Attorney at Law

This blog is intended for informational purposes only and is not substitute for legal advice from a qualified attorney in your jurisdiction.

WHY IS AN LLC THE BEST WAY TO HOLD TITLE TO RENTAL PROPERTY?

2010-03-02T16:29:00.000-08:00

An LLC is the best way to hold title to investment (rental) property for two reasons:

First, a California Limited Liability Company (LLC) offers its owner-members the same limited liability protection as a corporation. Cal. Corp. Code Sec. 17101(a).

Even if you have insurance, a judgment may exceed the insurance coverage, and if the property is your individual name, the judgment creditor/claimaint will be able to attach your personal assets (including other properties, your home, bank accounts, stocks, etc.) to satisfy the judgment. If the owner of the property is the LLC, the judgment creditor may only attach the assets of the LLC, not the other assets of the member-owner of the LLC not owned by the LLC.

If you own multiple investment properties, it may be adviseable to have a separate LLC own each of the separate properties. In the event of a judgment against one LLC, the judgment creditor can only go after the assets of the defendant LLC, and not the other LLC's.

Second, there are several tax advantages for holding title to the rental property as an LLC. Like a sole proprietorship or partnership, a California LLC enjoys pass-through taxation. This means that owners (known as "members") report their share of the income or losses on their individual returns.

A single-owner LLC offers the benefit of being automatically classified as a sole proprietorship, meaning that the owner reports the LLC's income or losses on his or her own personal return.

While it is true that an S-Corporation can do both of the above, S-Corps have a negative tax treatment when the the shareholders (owners) of the S-Corp want to transfer the asset to other entity, or sell the property in exchange for a another property to be held by the S-Corp because the sale or transfer would immediately trigger the capital gains tax on the fair market value of the asset minus its basis. Also, any losses that may have been realized by the sale are limited to the shareholder's basis in the S-Corp.

Moreover, the S-Corporation cannot take advantage of the 1031 Exchange tax treatment. The same transfer or trade by an LLC can result in a tax-free transaction if done properly.

While both corporations and LLCs must pay the $800 annual franchise tax, most California real estate LLCs holding a single property can avoid the gross receipts tax if the LLC's gross receipts are below the statutory minimum.

The above discussion involves only rental/investment properties. Never put your personal residence in an LLC because of the loss of the federal capital gains tax exclusion on the sale of personal residence.

DWIGHT EDWARD TOMPKINS
Attorney at Law

http://www.tompkins-law.com/

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified attorney in your jurisdiction. Nothing in this blog should be considered tax advice.

FAILING TO FACE FAMILY REALITIES (Mistake #4)

2010-02-17T12:30:00.000-08:00

[Excerpt From Dwight's E-Book: "The Seven Most Common Mistakes Made in Estate Planning"]

Only you know your family. Be realistic and honest with your estate planning attorney when you meet with him or her.

Most families have problems, and it is important to understand that communicating the facts to your lawyer is essential.

The 2 big decisions made by clients in forming a will or a trust is the selection of a personal representative, and who will be the beneficiaries and what will they get.

In living trusts, the personal representative is called the "Successor Trustee". It is not by mistake that trusts are called trusts.

In a trust, the person named to the Successor Trustee will manage the trust and settle the trust without court supervision in private.

The trustee you name has to be trustworthy. It is a mistake to name the oldest son as the trustee just because he is the oldest son, especially if he has been in jail for theft-related crimes or has a bankruptcy on his record, or is known to have money problems.

Clients are often afraid to offend someone or violate traditions, or worse, they turn a blind eye to the drinking and drug problems of one of their adult children.

Many families face the same difficulties. However, you want your estate to be handled honestly and efficiently.

Truthfully evaluate your family and pick the best trustee. If there are no suitable family members as trustee, talk to your attorney about it, as there are alternatives.

Trustees not only have to be honest but capable. All of us have family members who are extremely honest, but are not good managers. You want to select a trustee who is honest and can handle your affairs when you pass away.

An experienced estate planning attorney will be of great help to you in evaluating your estate plan options.

To download the complete E-Book, visit my website at: TOMPKINS-LAW.COM

Dwight Edward Tompkins, Attorney at Law

This blog is intended for information purposes only, and is not intended as a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

THE LAW IS AN ASS. DID DWIGHT JUST SAY THAT?

2010-02-10T07:06:00.001-08:00

"THE LAW IS AN ASS" is the famous statement by the Charles Dickens character, Mr. Bumble.

A ridiculous set of tax rules are now in play that apply to people DYING IN 2010 ONLY.

That's right, these new tax rules only apply to people who die this year.

Among them is the one-year repeal of the "step up in basis" rule concerning a decedent's estate.

In simple terms, the "step up in basis" rule prior to 2010 allowed the "basis" in an asset of a deceased person to "step up" from the fair market value at the time it was acquired to the fair market value at the time of death.

For example, if grandfather had acquired stock in the company he worked for back in the 70's for $2 per share, his "basis" would be $2 per share. If the stock was worth $100 per share today, and he sold it, his capital gain would be $98 per share. If he was in the top tax bracket, that would be result in a capital gains tax of $14.70 for each share sold.

If grandpa died in 2009 (under the old rules), and left the stock to you, your tax basis would have been the value of the shares at the date of death. If the stock was worth $100 per share at the date of death, and you turned around and sold it for $100, there would be no capital gains tax.

If grandpa dies in 2010, you inherit grandpa's cost basis along with the stock, and you would be subject to the capital gains tax of $14.70 per share.

But, if grandpa hangs in there and doesn't die until 2011, the "step up in basis" rule goes back into effect and the stock would then have a $100 tax basis per share.

Of course, this assumes the government will not come up with some other silly rule before 2011.

To be fair, there is a partial replacement for the repealed basis step-up: Executors will be able to increase the the basis of estate property up to a maximum of $1.3 million for a single decedent or $3 million in the case of property passing to surviving spouse.

This sounds great, but consider this example.

A widow in 1970 uses life insurance proceeds to purchase income rental apartments for $100,000. She manages these apartments as her sole income while she raises her four children.

She dies in 2010, and the apartments are now worth FMV $2 million. Her four adult children don't want to manage the apartments and they sell the property for $2 million. They will have to pay capital gains tax on the $700,000 over the $1.3 million maximum allowable step up.

If she had died in 2009, they would have paid no tax.

The above examples and discussion have been simplified for purposes of discussion. There are other factors which affect cost basis, and could lessen the impact of the capital gains tax in some cases.

What is frustrating to estate planning attorneys and clients is how arbitrary the application of the law is, especially in this case, when the rules only apply to decedent's dying in 2010.

Maybe Mr. Bumble was right.

http://www.tompkins-law.com/

DWIGHT EDWARD TOMPKINS

Attorney at Law

This blog is intended for informational purposes only and is not intended as a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

WHAT IS THE DIFFERENCE BETWEEN A LIVING TRUST & A TESTAMENTARY TRUST?

2010-02-01T15:18:00.000-08:00

Simply put, a Living Trust is a trust created by you while you are still living.

A Testamentary Trust is created by the court after you have died.

Living Trusts are sometimes referred to in Latin as an Inter Vivos Trust. Living Trusts avoid Probate because they are created and funded when the client is still alive. When the client dies, he or she theoretically do not own their assets because they are owned by their Living Trust.

Testamentary Trusts do not avoid Probate because they are created by the court during the Probate proceedings by enforcing the client's instructions in the client's Will.

The Living Trust is more commonly used by my clients because of the Probate avoidance feature.

Testamentary Trusts are usually employed when the client anticipates a Will Contest or other family problems, and desires that the court enforce the creation of the trust and the appointment of the trustees.

The decision to use a Living Trust vs. a Testamentary Trust should involve legal advice from a qualified Estate Planning Attorney.

If you have any questions, regarding this or other Estate Planning subjects, please visit my website at: http://www.tompkins-law.com

DWIGHT EDWARD TOMPKINS

Attorney at Law

This blog is intended for informational purposes only and should not be considered a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

CAN CONGRESS AMEND THE ESTATE TAX REPEAL RETROACTIVELY?

2010-01-22T08:16:00.000-08:00

The answer is YES. Congress in 1987 amended a deduction allowed in the 1986 estate tax law, which caused a deduction against the estate tax taken by an estate executor to be disallowed after he had already taken it.

The U.S. Supreme Court in the case, United States v. Carlton, 512 U.S. 26 (1994), ruled that the 1987 amendment's retroactive application to Carlton's 1986 transactions did not violate his due process rights in the U.S. Constitution.

For decedent's passing away in 2010, the repeal of the estate tax (which is just for 2010) sounds great. But, most observers, including myself, think that Congress will amend the law taking away the repeal and replacing it with an estate tax with some kind of deduction. What that will entail is anyone's guess.

Trustees and executors of estates for persons who pass away this year should carefully consider the size and nature of the estate, consult with their C.P.A. and see their Estate Planning Attorney. It may be advisable in some cases to only make a partial distribution, and to hold back a reserve of funds against a possible estate tax caused by a retroactive amendment.

The strategy taken may also include filing a 706 Estate Tax Return and claim zero tax. But, no one should rely on this as "bullet proof" against Congress deciding to take away the Estate Tax Repeal.

Please visit my website at: http://www.tompkins-law.com

DWIGHT EDWARD TOMPKINS

Attorney at law

This blog is intended for informational purposes only and is not intended to be a substitute for legal advice from an qualifed Estate Planning Attorney in your jurisdiction.

2010 ESTATE TAX CHANGES - WATCH OUT!

2010-01-12T07:21:00.000-08:00

Well, get ready. The 2010 changes in the Estate Tax have thrown confusion into the whole Estate Planning process.

Should this confusion stop anyone from executing an Estate Plan? The answer is NO. Estate planning is still a crucial act that will help your family and give you peace of mind.

Here are the changes. First, the Estate Tax is repealed for 2010. Theoretically, this means for anyone dying in 2010, their estate will pay no estate tax no matter how large their estate may be.

Sounds great doesn't it? Estate planning attorneys and other financial experts expect that Congress and the President sometime within 2010 will reinstate the Estate Tax, and here's the kicker -- they will probably make it retroactive back to January 1.

Trustees, attorneys, and others administering an estate for a person dying in 2010 are well advised to hold back some funds against possible estate taxes that may be retroactively imposed.

Second, along with the repeal of the Estate Tax, in 2010 there is an elimination of the "Step-Up" in Basis Rule as to assets in a decedent's estate. Prior to 2010 all property owned by a decedent received a basis increase to its value on the decedent's date of death. So, a surviving spouse or the family could sell an asset such as real estate or stock just following the death of the decedent and pay little or no capital gains tax because the basis was "stepped up" to the value at date of death.

Now in 2010, Capital Gains Tax will be incurred when the property is sold; the gain being calculated as the difference between the decedent's basis (when the property was originally purchased by the decedent) and when the property was sold after the decedent passed away. This is because there is no "Step-Up" in Basis in 2010.

The so-called "repeal" of the Estate Tax in 2010 is really a shift of the tax to the Capital Gains Tax. This is a shame because the Estate Tax has traditionally only landed on the wealthy, where the loss of the step-up in basis will cause the Capital Gains Tax to land on everyone.

Even if Congress reinstates the Estate Tax, I am not confident that they will do the right thing and reinstate the "Step Up" in Basis Rule for Capital Gains.

Under the present code, the Estate Tax and the "Step-Up" in Basis Rule are reinstated in 2011. Don't you wish they'd make up their mind? I'll cover the 2011 expected changes in a future blog.

In the meantime, I'll be watching.... Visit my website at http://www.tompkins-law.com

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational purposes only and is not intended as a substitute for legal advice by a qualified estate planning attorney in your jurisdiction.

Do You Need Long-Term Care Insurance?

2010-01-06T10:51:00.000-08:00

Clients often ask about long-term care insurance; and the answer is that it depends on your situation. Your health, your financial resources, and likely arrangements for future care (e.g., family, etc.) must be considered.

It may become necessary for each of us to be faced with the need for daily help with things such as bathing, dressing, and preparing meals. Some people need long-term, 24-hour assistance.

This kind of care is expensive and can be a financial strain on the family. Medicare does not cover long-term care; instead, Medicare only covers nursing facility and home health care if it is skilled care, medically necessary, and only for a limited period of time.

Long-term insurance covers the costs of the custodial care that Medicare doesn't cover. This can include home health care, adult day care, nursing home care, the cost of assisted living facility expenses, and respite care.

Before investing in a long-term care policy or contract, consider your circumstances carefully. You may discuss this with your estate planning attorney or another excellent resource is to contact the California Health Insurance Counseling and Advocacy Program (HICAP). To contact a HICAP counselor call 1-800-434-0222.

If you have any questions regarding this or other Estate Planning topics, please visit my website at: http://www.%20tompkins-law.com/.

DWIGHT EDWARD TOMPKINS, Attorney at Law

This blog is intended for informational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

HAPPY NEW YEAR

2009-12-29T09:35:00.000-08:00

WISHING ALL OF YOU A HAPPY NEW YEAR FOR 2010.

2009 was a great year for me with the creation of my new blogs, "Trusts and Estates" and "Fideicomisos y Testamentos", and my new YouTube channel "Family Trusts and Estates".....

DWIGHT EDWARD TOMPKINS, Attorney at Law

Merry Christmas

2009-12-21T12:07:00.000-08:00

MERRY CHRISTMAS TO ALL MY CLIENTS AND FRIENDS......

DWIGHT

http://tompkins-law.com

WHY USE AN ATTORNEY VS. AN ONLINE SITE TO CREATE AN ESTATE PLAN

2009-12-16T13:39:00.000-08:00

The main reason to work with an qualified estate planning attorney to create an estate plan rather than go online and download a form is ADVICE & RELATIONSHIP.

Online websites which sell living trusts offer NO advice on the development of a comprehensive estate plan. In fact, all of the websites selling legal documents state clearly that the use of the site does not include legal advice, and if you need legal advice, you need to talk to a lawyer.

There is so much more to an estate plan than taking a boiler-plate document and filling in the blanks. And good luck when you have a question later on, or you need to amend your estate plan.

Which leads me to the second part of the answer above: relationship! Having a relationship with a good estate planning attorney gives you a live person to call when you have questions, and when life circumstances change, and you need to amend the trust and estate plan, online sites just fail in that regard.

Most people who use online legal websites are just trying to avoid paying attorney's fees. But, those sites are really not very cost effective compared to the average fees charged to create an estate plan.

When you look at one of the most popular legal websites, by the time you pay the base fee, the additional fees, and then you have to take the documents to a Notary Public (in California, 5 documents X 2 people X $10 = an additional $100), you may have saved $200-$300 dollars.

I spend on average 1-2 hours with clients on the initial consultation, and an additonal 1-2 hours during the signing in which I explain the documents in detail.

You may save $200 by going online, but you don't get 2-4 hours of face-to-face advice and counseling from a qualified lawyer.

And good luck if you make a mistake online, push the wrong key, and end up with a document that doesn't work.

Remember that a computer program will not answer your calls when you have a future problem or you need to make changes to your estate plan.

More information about trusts and estates can be found on my website:

http://www.tompkins-law.com/

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational purposes only and does not constitute legal advice from a qualified estate planning attorney in your jurisdiction.

WHY THE 1ST OF YEAR IS A GOOD TIME TO CREATE YOUR ESTATE PLAN

2009-12-05T13:57:00.000-08:00

WHY THE 1ST OF THE YEAR IS A GOOD TIME TO CREATE YOUR ESTATE PLAN

One of the key parts to the creation of an estate plan is pulling together an asset list. In January, most people will receive "end of the year" statements, which are critical for preparing tax returns for the year.

These end of the year statements can easily be put into a folder and taken to the initial meeting with the estate planning attorney. The attorney at a glance can see the (1) the title ownership of the accounts, (2) the character of the account [i.e., retirement, investment, etc.], and the value of the account.

The value of the account is important for the attorney to determine the relative size of the estate when considering whether the estate will likely be subject to any federal estate tax impacts.

The 1st of the new year is a good time to meet with the estate planning attorney as a matter of finally following through with all those "New Year's Resolutions" that this is the year we set up our trust.

So don't wait another year, make 2010 the year to set up your family trust estate plan and enjoy the peace of mind of knowing your family is protected, and that your planning is complete.

For more information on family trusts, estate planning, wills, powers of attorney, retirement and other topics please visit my website:

http://www.tompkins-law.com

If you reside anywhere in California, and in particular, the quad-county area [Los Angeles, Orange, Riverside, San Bernardino], my office is freeway close, and I would enjoy the opportunity to help you protect your family with a Family Trust.

DWIGHT EDWARD TOMPKINS, Attorney at Law

This blog is intended for information purposes only and is not intended as a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

Reverse Mortgage Basics

2009-11-25T10:12:00.000-08:00

REVERSE MORTGAGE BASICS

A "Reverse Mortgage" allows an older homeowner (62 years of age or older) to use the equity in their home to obtain cash resources when other resources have dwindled or are insufficient, but the home equity has grown.

All of the borrowers must be on title, however, most lenders will accept a living trust (family trust) as the title owner. This arrangement will leave the living trust estate plan undisturbed, an important factor in financing of real estate owned by a living trust (family trust).

A Reverse Mortgage works very much like a line of credit, and because it is a loan, the payments to the borrower(s) are not considered taxable income.

Social Security and Medicare eligibility are not affected by a Reverse Mortgage; and in general, neither are SSI or Medi-Cal, so long as the bank balance is not more than $2,000 for a single person.

The loan is non-recourse, which means that the borrower is not liable for a negative loan balance should the equity of the home go down.

There are no monthly payments on the loan usually, and the repayment of the loan is deferred as long as the borrower(s) live(s) in the home. Also, the loan can be repaid anytime without a prepayment penalty.

If the borrower becomes incapacitated and is out of the home for more than a year, payments cease, and the lender can require payoff.

This is only basic information about Reverse Mortgages. Before entering into a Reverse Mortgage arrangement, it is always advisable to talk to your C.P.A. about taxes and other financial consequences, and also with your Estate Planning Attorney to ensure that your legal objectives remain unaffected by the transaction.

Please visit my website for information on Family Trusts and Estate Planning for more useful information about this and other subjects:

http://www.tompkins-law.com/

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for information and educational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

ROTH IRA CONVERSIONS IN 2010

2009-11-20T10:04:00.000-08:00

ROTH I.R.A. CONVERSIONS IN 2010

Roth IRAs historically have been off limits to high income taxpayers. Converting a "Traditional IRA to a "Roth IRA" has been prohibited at income levels above $100,000 through the end of 2009.

Beginning January 1, 2010, all taxpayers, regardless of income, will now have the option of converting their "Traditional IRA" to a "Roth IRA". Thus, financial advisors are expecting a rush in early 2010 by high-income clients converting to Roth IRAs.

The advantage of the Roth IRA is that there are no mandatory annual distributions after age 70 1/2, so savings can be left to grow tax free to heirs. As an estate planning attorney concerned with assisting clients in preserving wealth for their family, the Roth IRA works well with the overall estate plan of many clients.

The new Roth IRA opportunity in 2010 may be especially helpful to people who have rolled over 401(k)s and other plans into IRAs when they changed jobs or retired.

The decision to convert depends on several factors, and working with a capable financial advisor is very important.

Equally important for all qualified retirement plans is to make sure that you have named beneficiaries, both primary and secondary.

When meeting with clients to create a Family Trust, one of the important things I look at is the designation of beneficiaries on retirement accounts, life insurance, and annuities.

Often clients have failed to name beneficiaries on these accounts, or the beneficiary designations are not up to date.

Because retirement, life insurance, and annuities pass to the beneficiaries outside of Probate, having up to date and complete designations of beneficiaries is extremely important.

If you have any questions on this topic or any other topic in Estate Planning, please visit my website at

http://www.tompkins-law.com

DWIGHT EDWARD TOMPKINS

Attorney at Law

This blog is intended for informational and educational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

"Family Trusts" You Tube Channel Has Important Videos

2009-11-04T08:08:00.000-08:00

THE FAMILY TRUSTS YOU TUBE CHANNEL HAS 7 GREAT ESTATE PLANNING VIDEOS

Seven videos are now available on You Tube covering the following important topics:

ESTATE PLANNING BASICS

FAMILY TRUSTS AVOID PROBATE

ESTATE PLANNING: PROBATE AND FAMILY TRUSTS

ESTATE PLANNING: COMMUNITY VS. SEPARATE PROPERTY

WHEN TO REVIEW AND AMEND YOUR TRUST

ESTATE PLANNING: THE PROBLEMS WITH JOINT TENANCY

ESTATE PLANNING: DOING NOTHING, THE BIG MISTAKE

All of the videos are presented by me, some taken from my last seminar in September. Please check them out.

http://www.youtube.com/user/FamilyTrusts

DWIGHT EDWARD TOMPKINS, Attorney at Law

This blog is intended for information purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

When To Review and Amend Your Trust

2009-10-23T16:05:00.000-07:00

WHEN TO REVIEW AND AMEND YOUR TRUST

My new video on youtube explains when to review and amend your trust. You can view the video by clicking: http://www.youtube.com/user/FamilyTrusts

Other videos on Estate Planning subjects are also available on the Family Trusts and Estates channel......

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for informational and educational purposes only and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

Bank "Trust" Accounts

2009-10-12T09:52:00.000-07:00

BANK "TRUST" ACCOUNTS:

Banks have a type of "trust" account which many people use to pass the account to a beneficiary when the account holder passes away.

The technical term for this type of account is a "Totten Trust". It is not a true trust in the legal sense of the word "Trust", because it does not set up a separate entity with a trustee in charge of the Trust.

A better description and more accurate term is to call these accounts "Pay on Death Accounts". This is because the account is designed to "pay" a named beneficiary "on death" of the account owner.

The account is an asset of the account holder and can be used as the account holder pleases until they die. Upon death, it goes to the person named.

It avoids probate, so it is not subject to either the account holder's will or their intestate estate.

The words "pay on death", "in trust for", and "a trust for" are often abbreviated in the account title; for example:

John Smith P.O.D. Mary Smith

John Smith I.T.F. Mary Smith

John Smith A.T.F. Mary Smith

The Totten Trust is a helpful tool in estate planning, but in most cases, should not be used as the exclusive estate plan device for several reasons:

* Many assets may not be owned in this manner.

* It also does not provide alternatives, such as what happens if the beneficiary dies before the account holder.

* It does not provide for estate tax avoidance or minimization of the potential estate tax.

* In a community property state such as California, if the account is a community property asset, and the beneficiary is not the surviving spouse, the distribution may be subject to challenge by the surviving spouse.

There are other potential problems with the use of a Totten Trust, and therefore, it is always best to consult with a qualified estate planning attorney before using a Totten Trust, especially as the primary estate planning tool.

If you have other questions about this subject please visit my website at:

http://www.tompkins-law.com

or email me at:

detlaw@juno.com

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for infomational and educational purposes only, and is not a substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

What is an Estate?

2009-10-06T15:15:00.000-07:00

WHAT IS AN ESTATE? AND WHAT IS INCLUDED IN MY ESTATE?

Your estate is simply ALL OF YOUR ASSETS. Your assets include assets which are held in your name alone, or jointly with other persons, such as your spouse.

The assets of the estate may include bank accounts, real estate, stocks and bonds, furniture, cars, jewelry, and other personal property of value (art work, collections, china, crystal, etc.).

Assets of the estate may also include life insurance proceeds (if you are the owner of the policy as well as the insured), retirement accounts, and payments that are due to you personally.

The value of the estate is equal to the "fair market value" of the different kinds of assets, after you have deducted your debts.

Because of the federal estate tax that is levied on estates which exceed a certain amount, the determination of the fair market value of the estate is very important.

Value of the estate is also necessary to determine so that the trustee, executor, or other personal representative can make the distributions required by the estate plan, if any.

For example, even a simple distribution plan such as equal shares or divisions to the children must be based on what is the value of the total estate so that equal shares can be calculated.

Good estate planning requires that an inventory and valuation of the assets take place as part of the planning process, even if it is an informal inventory and valuation.

Working with a qualified estate planning attorney is critical to this kind of planning so that the intent of the client is carried out.

If you have any questions about this or other estate planning matters, please visit my website at: http://www.tompkins-law.com

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended for educational and informational purposes only and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

NEW YOUTUBE CHANNEL

2009-09-24T18:09:00.000-07:00

My new YouTube Channel is now up and running, with 2 videos covering Family Trusts and Estates.

Please take a look and send me your comments:

http://www.youtube.com/user/FamilyTrusts

Thanks, Dwight

SPECIAL NEEDS TRUSTS

2009-09-10T10:55:00.000-07:00

SPECIAL NEEDS TRUSTS

Parents who have a disabled child or child who is severely incapacitated, are faced with the problem of how to provide for that child financially after the parents have passed away.

Because the child (whether a minor or an adult) may have qualified for various kinds of governmental benefits and assistance, the parents must be careful not to disqualify the child due to an inheritance. Many government programs require the child-recipient to have resources and income below a certain level to qualify.

A solution to this problem is to create a "Special Needs Trust" for the child. Through a special needs trust, the parents can provide a financial benefit to the child to supplement the disabled child's government benefits without interfering with the government aid.

Some key elements of a special needs trust is that the disabled child may not be the trustee or have any control or direction over the assets of the trust; and that the trust must be irrevocable.

A qualified estate planning attorney can be helpful because of the complexity of navigating in the field of the various public benefits and the rules concerning them.

Trust clauses can be designed to preserve trust benefits even if the law or the beneficiary's condition change during the term of the trust. "Backstop" provisions can be written to preserve trust assets if the eligibility rules change for the child during the trust term.

If you are interested in "Special Needs Trust" and need more information, contact a qualified estate planning attorney in your area; or contact me directly:

http://www.tompkins-law.com/

DWIGHT EDWARD TOMPKINS
Attorney at Law

This blog is intended as information only and not as a substitute for legal advice by a qualified attorney in your jurisdiction.

Why Use An Attorney To Set Up A Family Trust?

2009-08-28T10:36:00.000-07:00

Why Use An Attorney To Set Up a Family Trust?

The Answer is quite simple: FOR EXPERT LEGAL ADVICE.

"Fill in the blank" trust forms have always been available from the stationery store. Financial planners and other non-lawyers have also been out selling trusts to the elderly for many years. Now the latest rage is legalzoom and other on-line sites sell trusts.

These on-line sites like legalzoom are simply a computerized version of the "fill in the blank" forms you could always buy at the stationery store.

It is unfortunate that trusts are treated like a commodity by some people, like a can of beans on a shelf at the super market.

A family trust is a legal document that carries out certain objectives for the client. There is wide range of types of trusts and various ways in which trusts can be put together, and coordinated with other legal mechanisms. There is no one trust that fits everyone because everyone's situation is unique.

When a trust is viewed like a can of beans, then the client starts looking for the cheapest can of beans or one with a savings coupon this week.

The client instead should look at finding a good attorney that the client can develop a relationship with; an attorney who knows the client's situation, the client's needs, and the client's objectives. The family trust is a product of the relationship with the attorney, not just a product by itself.

At the heart of the relationship is the ADVICE. Advice is what separates out the estate planning lawyer from legalzoom and the like.

Sure, legalzoom is cheaper. But, after the clients pay for the extras on legalzoom (in addition to the advertised price), and receives the documents by mail, the clients have to take them to a notary to sign them. For a married couple, they will probably have 5 documents which will need notarizing. At $10 per signature, the statutory rate for a notary in California. The client will end up paying another $100.

A trust estate plan through legalzoom will end up costing hundreds of dollars, and in the end, for an average client, they will have saved about $200-$300 over an attorney prepared estate plan.

I spend anywhere from 2-4 hours in the initial consultation and the signing meeting with clients. I listen to their needs, and discuss all of the options available to them. They can call me anytime during the process and ask follow up questions or change their mind about decisions prior to the signing of the documents. And there are no additional charges or costs for those calls.

After the signing of the documents and the establishment of the estate plan, clients are free to call me about questions or concerns, and most of those calls are not billed by me. My relationship with my clients continue for years as we stay in contact with each other to ensure that the estate plan is kept up to date.

I often say that I don't charge clients for a phone call to answer a question, but if you send me to the law library for a research project on an obscure topic, I will probably have to bill them for it.

The value of the extra $200-$300 of fees is in the close relationship that you obtain with your lawyer, and the time and advice provided to you for your solutions.

If you would like to talk about an estate plan, one that is affordable and customized to your needs and objectives, please contact me.

I practice family trust law in the quad-county area of Orange, Los Angeles, Riverside, and San Bernardino Counties.

DWIGHT EDWARD TOMPKINS
Attorney at Law

http://www.tompkins-law.com/

http://www.fideicomisos-testamentos.com/

PET TRUSTS

2009-08-19T13:20:00.000-07:00

PET TRUSTS IN CALIFORNIA

In 2008, California adopted a revised pet trust statute, which is found in California Probate Code Section 15212.

This law allows for you to include in your estate plan the provision that upon your death, a certain sum of money will be a held by trustee (that you appoint) in trust for benefit of your pet. A caregiver is also nominated to take care of the pet. The trustee and the caregiver may be the same person, or 2 different persons.

The nominated caregiver takes physical possession of the pet when you die, and the trustee provides funds to the caregiver as needed for the costs of the pet's food, veterinary care, and supplies.

A pet trust is a lawful trust, but is considered noncharitable; and "animal" is broadly defined in the law to include any domestic or pet animal.

The pet trust ends when the animal dies, and any funds left over are distributed to "remainder beneficiaries".

There are some requirements for accounting for large trusts, or if the trust document requires accountings, or if a court so orders an accounting.

If you are interested in learning more about this topic or any other estate planning topics, please contact me.

DWIGHT EDWARD TOMPKINS
Attorney at Law

http://www.tompkins-law.com/

This blog is not intended as substitute for legal advice from a qualified estate planning attorney in your jurisdiction.

Do I Need Amend The Trust When Assets Change?

2009-08-10T16:21:00.001-07:00

DO I NEED TO AMEND MY TRUST WHEN MY ASSETS CHANGE?

This is a very common question by clients, and the answer is very simple:

NO!

A trust is designed to hold your assets in title to avoid probate on your death. During the course of your lifetime, the assets you own may change. You will sell property and buy other property. You will close bank accounts and open other accounts.

None of these actions affect the terms of the trust, so an amendment is not required. What is required is for you to make sure those assets are titled in the name of the trust. If you have any questions, ask your estate planning attorney or contact me for guidance.

A similar question is asked about the schedule of assets that is usually found in the last pages of the trust declaration or trust agreement. This schedule is often referred to as Exhibit "A" or by some other name.

Exhibit "A" is only a listing of what is intended to be in the trust at the time the trust instrument is executed. Merely listing the assets on the schedule doesn't effect a transfer to the trust, it merely states an intention.

So, since it is not a material part of the trust, the trust is not required to be amended simply because the assets on the schedule have changed.

Trust amendments are required when material terms of the trust have changed. For example, changing the successor trustees or changing the beneficiaries.

Dwight Edward Tompkins, Attorney at Law

http://www.tompkins-law.com

This blog is intended for informational and educational purposes only, and is not a substitute for legal advice from a qualified attorney in your jurisdiction.

CHICAGO TITLE COMPANY - CHARLES ARMIJO

2009-08-04T16:33:00.000-07:00

CHICAGO TITLE COMPANY- CHARLES ARMIJO

As an estate planning attorney, I rely from time to time on the services of a solid title company to assist me in obtaining title information for my clients.

Recently, I switched to using the services of CHICAGO TITLE COMPANY, Orange County, and my contact has been CHARLES ARMIJO, Assistant VP. (Charles is pictured above).

Charles and his assistant, Adela Garcia, have given me first rate service and response when I have called upon them.

I highly recommend that you request Chicago Title Company for any and all real estate transactions, and that you refer to Charles Armijo.

You can contact Charles Armijo as follows:

Charles Armijo, Assistant Vice President

Chicago Title, Orange County

16969 Von Karmen, Ste. 150

Irvine, CA 92606

714 865-0003

CharlesArmijo@aol.com

Adela Garcia

949 263-6843

adela.garcia@ctt.com

If you are interested in Trusts, Wills, and Estate Planning, and you wish to obtain more information, please visit my website at: http://www.tompkins-law.com/

This blog is for information and educational purposes only, and is not intended as a substitute for legal advice from a qualified attorney in your jurisdiction.

Dwight Edward Tompkins, Attorney at Law

Anaheim Corporate Plaza

2390 East Orangewood Ave., Ste. 595

Anaheim, CA 92806

714 385-0044

detlaw@juno.com

http://www.tompkins-law.com/

IRREVOCABLE LIFE INSURANCE TRUSTS

2009-07-30T12:04:00.000-07:00

IRREVOCABLE LIFE INSURANCE TRUSTS & WHEN TO USE THEM:

The Federal Government through the tax code levies an "Estate Tax" on estates which exceed a certain amount, known as the "exemption amount" or the "unified credit".

In 2009, the exemption amount is $3.5 Million, however, there is a likelihood of a tax code change in the near future. No one really knows when that will occur and what it may be, however, I believe the exemption amount will be cut back.

One of the techniques to deal with payment of the estate tax is the use of a Irrevocable Life Insurance Trust".

Because the U.S. tax code does not tax life insurance proceeds as income, the proceeds of the life insurance policy can be used to pay the estate tax.

To keep the life insurance proceeds from also be counted as part of the estate (and therefore driving up the value of the estate), the decedent must not hold any "incidents of ownership", i.e., the decedent cannot be the owner of the policy.

A trust can be the owner of the policy, but it must be IRREVOCABLE because the IRS considers the ability of the grantor to revoke or amend the trust as an incident of ownership.

Thus, an Irrevocable Life Insurance Trust" can be established to own the life insurance policy, keep the proceeds out of the estate, and provide liquidity for payment of estate taxes separate from the estate itself.

An Irrevocable Life Insurance Trust" is best used in circumstances where the size of the estate will exceed the exemption amount, and the estate does not consist of enough liquidity to cover the estate tax, which must be paid within six (6) months of death.

The use of an Irrevocable Life Insurance Trust is not for everyone, and you should seek counsel from an experienced and qualified estate planning attorney, and also a qualified Certified Public Accountant before forming any irrevocable trust arrangement.

DWIGHT EDWARD TOMPKINS, Attorney at Law

http://www.tompkins-law.com

The information contained in this blog is for information purposes only and does not consistute legal advice or a substitute for legal advice provided by a qualified attorney in your jurisdiction.

Trusts: Revocable or Irrevocable?

2009-07-20T22:12:00.000-07:00

Trusts: Revocable or Irrevocable?

Clients usually know the difference between a revocable trust and an irrevocable trust. But, they often ask why one would be chosen over the other.

In Estate Planning, a revocable trust is more common because the trust's creator retains the ultimate power over the trust and its assets.

Among them, revocability also means that the trust is amendable. Amendments allow the trust's creator to make changes, adapt to changes in family, finances, and objectives.

Revocable trusts also have certain tax advantages, not only with income tax (a separate fiduciary tax return is not required) but also with property taxes (transfer to a revocable trust for the creator's benefit avoids reassessment under Prop 13 in California).

But, it is the flexibility and power to the creator that makes revocability desireable.

There are special circumstances where irrevocable trusts are desireable. They are often formed in tandem with a revocable trust. Irrevocable life insurance trusts and "special needs trusts" are common examples.

The choice of which kind of trust to utilize is important legal decision that should be made with the advice of counsel.

DWIGHT EDWARD TOMPKINS, ATTORNEY AT LAW

Check out my website at: http://www.tompkins-law.com/ My free, downloadable e-book, "The Seven Most Common Mistakes Made in Estate Planning" is available.

The information in this blog is for information purposes only and does not constitute legal advice. You should consult a qualified attorney in your jurisdiction for legal advice in this or any other legal matter.

Cal. State Bar No. 149756

SEMINAR FOR 7/18/09 CANCELLED

2009-07-16T09:05:00.000-07:00

The Seminar scheduled for Sat., July 18, 2009 in Cerritos has been cancelled. The initial response was so receptive, that the scheduled room would have been too small.

I am working to schedule a larger room for a date in the near future.

Thank you.

Dwight Edward Tompkins, Attorney at Law

http://www.tompkins-law.com

ESTATE PLANNING SEMINAR - JULY 18, 2009

2009-07-13T07:59:00.000-07:00

PLEASE JOIN ME FOR AN ESTATE PLANNING SEMINAR, THIS SATURDAY, JULY 18, 2009, 9:00 A.M.

WHERE: CERRITOS LIBRARY, 18025 BLOOMFIELD AVENUE, CERRITOS, CA 90703

HIGH TECH TRAINING LAB, LEVEL 3

FREE PARKING

http://www.tompkins-law.com

This post is for information purposes only, and does not constitute legal advice from a qualified attorney licensed to practice law in your jurisdiction.

Backpacking Grand Canyon 2005

2009-06-21T11:28:00.001-07:00

In April 2005, I backpacked the Grand Canyon for the first time. I was accompanied by my friend, Gary Leister, and my son, Jason Tompkins.

We hiked the South Rim routes, descending the South Kaibab Trail on Day 1 of our 2 day backpacking trip. As we descended the 4,740 ft. elevation loss from the trailhead to the bottom of the Grand Canyon we encountered snow, then hail, and finally rain.

The top photo of me was taken during the hail storm with O'Neil Butte in the background. In the bottom photo, I am standing at the "TipOff", just below the Tonto Platform. You can see the Colorado River on the left side of the photo.

We camped the night at the Bright Angel Campground, and slept the night in an all-night downpour.

On Day 2, we hiked back out of the Canyon on the longer, but less steep Bright Angel Trail under sunny skies.

Two years later (May 2007), I backpacked the Rim-to-Rim trip (23.9 miles) across the Canyon with my son, Jason Tompkins, and my daughter, Kristin McClintic, and 3 others.

Grand Canyon to many hikers is the holy grail of backpacking. Hiking the Canyon twice has been one of the most rewarding experiences for me as a hiker.

I am hoping to tackle the Hermit Trail in a couple of years.

Thanks for reading. Dwight

http://www.tompkins-law.com

SELECTING A SUCCESSOR TRUSTEE

2009-06-11T19:17:00.001-07:00

The Selection of a Successor Trustee is perhaps the most important decision in the creation of a Living Trust.

It is not by mistake that Living Trusts are called "TRUSTS", because the Successor Trustee manages your Trust Estate and distributes your estate without court supervision. Thus, the person you select to be your Successor Trustee must be above everything else, TRUSTWORTHY.

Another important quality is the ability to act as Trustee and carry out your directions. Does your Successor Trustee have the ability to handle money, open and close bank accounts, review bills and pay them, hire a realtor to sell real estate, keep an accounting of your Estate, deal with lawyers, accountants, financial advisors, insurance companies, etc.?

Ideally, your Successor Trustee should be someone who is younger than you and therefore likely to survive you. This is more important as you get older. When you are 35 years old, your 40 year old brother would be a good nominee as the Successor Trustee. However, when you are 75 years old, having your 80 year old brother may not be such a good choice.

Finally, is the Successor Trustee living close to you and your Estate? Of course, trustworthiness and ability are the most important factors, but it is easier for a Successor Trustee to handle your affairs if he or she is local. But, with emails, faxes, wire transfers, overnight delivery, and so forth, someone can act as Successor Trustee from a great distance in today's world.

Always ask the questions, do I trust my Successor Trustee to carry out my wishes? And is my Successor Trustee capable to handle financial and legal matters?

DWIGHT EDWARD TOMPKINS, ATTORNEY AT LAW

http://www.tompkins-law.com

Please visit my website, and thanks for reading my blog.

This blog is for informational purposes only and does not constitute legal advice. The information contained herein is not a substitute for legal advice from a qualified attorney in your jurisdiction.

Retirement Accounts, Life Insurance & Annuities Part 2

2009-06-03T22:00:00.000-07:00

The Role of Retirement Accounts, Life Insurance and Annuities in Estate Planning - Part 2

In my last post I set out the general rule in estate planning that all of the assets should be titled in the name of the trust.

I also set out the 3 general exceptions to that rule: Retirement Accounts, Life Insurance and Annuities.

We saw that the reason for the exceptions is that these 3 kinds of assets have beneficiaries designated to receive the assets upon the death of the owner and/or the insured.

In the last post, I discussed retirement accounts.

Now, I will briefly talk about life insurance and annuities.

Life insurance and annuities are closely related to each other. Annuities for the most part are provided by life insurance companies.

An easy definition for an annuity is that it is a hybrid of a life insurance policy and an investment. Although that it is pretty general, it will do for our discussion.

The center-piece of life insurance is the naming of beneficiaries as it is the purpose of life insurance to "benefit" loved ones if the insured passes away.

Therefore, for estate planning purposes, the ownership of the policy is not as important as the naming of beneficiaries.

There are certain situations where ownership is an important factor, but as a general rule the beneficiary designation is the key in life insurance.

If you have a life insurance policy on your life or an annuity, it is wise to periodically review the designations of primary and secondary beneficiaries to see if they are up to date.

DWIGHT EDWARD TOMPKINS, ATTORNEY AT LAW

WEBSITE: http://www.tompkins-law.com/

This blog is intended for information purposes only, and does not constitute legal advice or a substitute for legal advise by a qualified attorney in your jurisdiction.

Copyright 2009 Dwight Edward Tompkins All Rights Reserved

RETIREMENT ACCOUNTS, LIFE INSURANCE & ANNUITIES - Part 1

2009-05-28T12:04:00.000-07:00

THE ROLE OF RETIREMENT ACCOUNTS, LIFE INSURANCE, AND ANNUITIES IN THE ESTATE PLANNING PROCESS:

The general rule in estate planning when setting up a living trust is to title all of the assets in the name of the trust. The reason for this is to avoid going into probate.

There are 3 EXCEPTIONS to this rule:

1. Retirement accounts;

2. Life Insurance; and

3. Annuities.

All of the above automatically avoid probate because they allow for the designation of death beneficiaries on those accounts; and the payment of the death benefit occurs as a matter of contract.

Therefore, estate planning attorneys, such as myself, are not concerned about ownership of these accounts as much as we are with the question: Who gets the money when the client passes away.?

Retirement Accounts:

There are two (2) kinds of retirement accounts, qualified plans and other types of retirement.

Qualified plans include IRA, Roth IRA, SEP-IRA, Keough, 401(k), 403(b), and other accounts which qualify under the Internal Revenue Code. All qualified plans allow the account owner (the employee) to name or designate primary beneficiaries and secondary or contingent beneficiaries.

When I work with clients in establishing an estate plan, one of the important assets to look at is the retirement accounts of the clients, and if they are a qualified plan, review the beneficiary designations. Frequently clients set up retirement accounts but did not follow through with naming a beneficiary or beneficiaries. Or circumstances have changed since they first named the beneficiaries and changes are now in order.

Looking at the beneficiary designations on qualified retirement plans and making sure they are up to date is extremely important in estate planning.

The other kind of retirement account is one that I would generally characterize as the traditional "pension". Pensions often terminate when either the employee/retiree passes away, or they only provide benefits to the surviving spouse. But, when both the employee and spouse are deceased, there is no further succession right to the pension by the family.

In the next blog, I will discuss the life insurance and annuity roles in estate planning.

DWIGHT EDWARD TOMPKINS, Attorney at Law

http://www.tompkins-law.com/

This blog is intended for information purposes only, and does not constitute legal advice. Readers should consult with a qualified attorney in their jurisdiction.

Copyright 2009 Dwight Edward Tompkins All Rights Reserved

BACKPACKING THE HIGH SIERRAS

2009-05-21T13:44:00.001-07:00

HIKING CONVICT CANYON IN THE SIERRA NEVADA MTNS.

MAY 2009

http://www.tompkins-law.com/

ADVANCE HEALTH CARE DIRECTIVES (CALIFORNIA)

2009-05-12T15:14:00.000-07:00

Starting in 2000, California (where I practice law) adopted the "ADVANCE HEALTH CARE DIRECTIVE" as the legally recognized health care planning document.

Many states have similar documents, the most common is the "Living Will" (don't confuse this with the Living Trust).

The Advance Health Care Directive in use in California is more flexible than the traditional living will in that it allows an individual to not only give various health care instructions in advance, it also allows for the individual to appoint someone to make medical decisions for them if necessary.

Thus, it also replaced the Durable Power of Attorney for Health Care (DPAHC). However, if you already have executed a DPAHC and it has not expired, it will still be valid and recognized in California.

The Advance Health Care Directive is very easy to complete, and the best form for it is produced by the California Medical Association.

Every adult residing in California should execute an Advance Health Care Directive.

It is often included in the overall Estate Planning of Trusts and Wills.

If you have any questions concerning the Advance Health Care Directive, please contact me.

I practice law in Orange County, California.

DWIGHT EDWARD TOMPKINS, ATTORNEY AT LAW

http://www.tompkins-law.com/

Nothing in this blog is intended to be legal advice or substitute for legal advice. This blog is for information purposes only. Mr. Tompkins is licensed to practice law in California. The laws of your state, country or jurisdiction may vary.

WHAT IS ESTATE PLANNING?

2009-05-06T11:01:00.000-07:00

WHAT IS ESTATE PLANNING?

ESTATE PLANNING IS THE WAY A PERSON PLANS THE DISPOSITION OF THEIR PROPERTY AND ASSETS WHEN THEY DIE.

Estate Planning helps people eliminate uncertainities of what will happen to their assets and property by the establishment of a written, and legally enforceable, plan.

Some of the goals that the average person seeks to accomplish in an Estate Plan are:

1. Avoidance of probate (i.e., going to court to settle the estate);

2. Maximizing the value of the estate by reducing taxes and other expenses;

3. Nomination of guardians for minor children;

4. Designation of specific beneficiaries, and the percentage of the estate they will receive;

5. Exclusion of certain family members from being a beneficiary; and

6. Naming a trusted family member or friend to adminster the estate.

There are other goals, but these are the most typical.

Estate Plans prepared by a qualified and experienced attorney include Trusts and/or Wills, Powers of Attorney (both for Health Care and Asset Management), Advance Directives (Living Wills), and other documents which work in coordination with the overall Estate Plan.

I practice law in Orange County, California; and Estate Planning is a primary focus of my practice.

DWIGHT EDWARD TOMPKINS, Attorney at Law

http://www.tompkins-law.com

Keeping Your Real Estate in the Trust

2009-04-25T09:41:00.000-07:00

If you have a trust, one of the important events to keep in mind is the purchase of new real estate or the re-financing of real estate.

Whenever these two events occur, the real estate title will often not be in the name of the trust. The result of the real estate properties not being in the trust is that if you die, the real estate will have to go through probate, which will frustrate the whole purpose of having a trust, and will cost your estate thousands of dollars in court costs and other fees.

Because real estate is often the "crown jewel", that is, the most valuable asset in the trust, it is usually the main asset which you do not want to have to go through probate.

Lenders prefer that the individual owners are on title to the real estate, and because the lenders more or less control the escrow, the deeds to the real estate will usually not be in the name of the owner's trust.

So, the Rule of Thumb is that if you have a trust and; you either buy new property or you re-finance existing real estate, contact you Estate Planning lawyer and have him or her check to make sure the title to that property is in the name of your living trust.

Or you can contact me at http://www.tompkins-law.com if you have any questions.

Remember it is not enough to create a living trust, you must always make sure that your valuable assets, like real estate, are in the name of that trust in order to avoid probate and to ensure a smooth transfer of your trust estate to your beneficiaries.

Dwight Edward Tompkins, Attorney at Law

http://tompkins-law.com/

TRUST BASICS

2009-04-14T13:21:00.000-07:00

TRUST BASICS

Although there are many kinds of trusts, the most common trust used in Estate Planning is the Revocable Living Trust, also referred to as the Living Trust, the Inter Vivos Trust, and the Revocable Inter Vivos Trust.

The Revocable Living Trust which for simplicity, I will refer to as a Trust, basically does the same thing as a Will but with many added benefits.

The main benefit is that unlike a Will which must be probated in court, a Trust avoids probate when it is properly created and funded.

A Trust is a legal entity, similar to a corporation, and as such it can own property. When a person puts all of their assets and property into the Trust (the trust is "funded"), and that person passes away, the Trust survives them. Therefore, because the Trust is the owner of the assets and property, no probate is needed.

A Successor Trustee named in the trust declaration or trust agreement settles the affairs of the decedent and distributes the remaining assets and property to the beneficiaries without a probate.

The avoidance of probate saves the estate thousands of dollars and a Trust usually allows for a faster and more private settlement of one's estate than the traditional Will.

I practice law in California, and I focus on Estate Planning, Trusts and Wills, as a major part of my law practice.

DWIGHT EDWARD TOMPKINS, Attorney at Law

http://www.tompkins-law.com/

My blog, Trusts and Estates, is for educational and informational purposes only, and it does not constitute legal advice. I practice law in California and my comments on this blog are applicable only to California. The laws of other jurisdictions may vary. You should always consult with a qualified attorney for legal advice in your jurisdiction.

California Bar No. 149756

WELCOME TO DWIGHT EDWARD TOMPKINS' BLOG

2009-04-09T18:21:00.000-07:00

WELCOME!!!

This is my first blog on blogger.com; and as an Estate Planning attorney, I will be writing about Estate Planning, Trusts, and Wills each week.

My task will be to present important topics in the law of Estate Planning, especially Living Trusts, in a straight forward, no-nonsense approach.

In the many Estate Planning Seminars that I have given over the past few years, I have discovered that people are very interested in providing for their family, protecting their assets, nominating guardians for their minor children, and planning for possible incapacity in the future.

My philosophy in the practice of law is present legal solutions in an easy to understand manner, and to provide my clients with accessibility to the benefits of the law.

Occasionally, I will write about other topics close to my heart, like backpacking and hiking.

I practice law in Orange County, California.

Thanks for reading my blog.

Dwight

DWIGHT EDWARD TOMPKINS, ATTORNEY AT LAW

http://www.tompkins-law.com/