“My husband and I are both in our 90’s, housebound, and trying to prepare for the hereafter.
We have always handled our own finances. Except for our house and car, our money is all in mutual funds, jointly as tenants, individually, and in separate IRA’s. We have wills and POA documents. Our beneficiaries are each other. We have no contingency beneficiaries.
The trouble we are facing is that our daughter, who is our executor, will need supervision from someone knowledgeable to oversee all of this when my husband and I die. An article I read said we need a “trusted advisor”.
We don’t have a network of friends and family to advise us. We do have an accountant for doing our taxes. One person I reached out to wanted to set up a living trust for us to avoid probate, but did not tell us other alternatives or who can help us prepare properly now and supervise the settling of our estates then.
Can you recommend someone or some firm that can help us?”
Thank you for your questions. I am hopeful we can provide you with the peace of mind that you seek.
First, we can most certainly assist you with identifying a trusted, experienced, estate planning attorney to guide your choices and draft your estate planning documents.
Second, do not be worried for your daughter’s ability to carry out her executor duties. The attorney who assists you in drafting your documents will also be available to guide your daughter when the time comes.
Third, please name contingent beneficiaries on every account that permits it. This will save your heirs time and frustration.
Last, please do not engage with anyone who wishes to sell you on a living trust until you’ve engaged with an attorney you trust. You are wise to wish to know the alternatives – pros and cons. In all likelihood, you do not need a living trust.
Thank you again for your questions and congratulations to you both for a long life and your sound thinking.
“My father has passed recently and we are in the process of resetting my mother’s finances (she’s 86 years old.)
My sister (the youngest of 5) had been written out of their will for the past 30 years but has returned to the family in the past 8 months. My mother would like to leave her something, but not an equal share, due to my parents spending “her portion” raising her two children (their grandchildren) and other expenses.
As far as I know my sister has never paid into taxes, has poor/no credit, and cannot handle money. My thought was to make her a beneficiary of an IRA account and not allow it to be touched until her age of 65. Can this be controlled from a beneficiary document as we roll over an IRA of my fathers?”
I am very sorry for your loss. And thank you for assisting your mother in the task at hand. This cannot be an easy time for her. I’m sure your help is greatly appreciated.
There’s (at least) one in every family. (By the way, if you think there’s no ‘one’ in your family – it’s likely you.) Your sister has been a challenge to your parents for (almost certainly) her entire life. But she is still your mother’s daughter and your mom wants to provide in some way.
Unfortunately, using the beneficiary document for an IRA will not protect your sister from herself. You should consult with the attorney assisting your mom with her will about drafting a trust for your sister. The trust could then accept the funds from the IRA and be used for your sister’s benefit as the trust document directs. Your mother’s wishes for how that should look will be translated by her attorney into the proper form to allow it to happen as she wishes.
This approach may cause some tax (income and estate) issues to be dealt with, and there may be an alternative approach to be explored. In either case, it is better to suffer a bit more in tax than see your sister (in her own senior years) end up penniless.
“My wife of 53 years passed away last November. I am 76 years of age. I have 2 children. Daughter is 52, son is 49. I just recently changed beneficiaries on my 2 brokerage accounts and an annuity. Also, my life insurance policy, long-term care policy, Roth IRA and regular IRA. I removed my wife’s name from our home’s deed and revised my Healthcare POA and Financial POA and will. It took a while to do all that. I appointed my son as executor.
My question involves my checking and savings accounts. I removed my wife’s name from the accounts and got new checks. I surrendered my safety deposit box because no one but me could access it and there wasn’t much in it anyway. How can I structure my checking and savings accounts (which total about $60,000) so that they will pass to my son and avoid probate?”
Our prayers go out to you with the loss of your wife. 53 years is an accomplishment of the first order. You and she were surely blessed.
You have done so many good things to get your estate ducks in line. I think you will be pleased at how simple the next steps will be.
The bank can assist you with creating a Transfer on Death (ToD) designation for your checking and savings accounts. Using this simple form and your signatures those funds will pass to your son and daughter in whatever proportions you choose without going through probate.
“IRS Called to Do Its Job!
A coalition of 11 CPA and tax professionals’ trade groups asked the Internal Revenue System to discontinue collections and other compliance actions until the service can address its backlog of tax filings and customer service issues.
Specifically, the coalition called on the IRS to “discontinue automated compliance actions until the IRS is prepared to devote the necessary resources for a proper and timely resolution of its challenges,” the group said in a letter sent to Lily Batchelder, assistant secretary for Tax Policy at the Treasury Department, and IRS Commissioner Charles Rettig.
The NTA found the IRS’s backlog of unprocessed returns has hit the 8.5 million mark.
Additionally, the IRS is only answering 9% of all calls and only 3% of calls regarding individual income tax returns, “which prevents taxpayers from resolving these straightforward issues,” the coalition said.”
So many of you are frustrated with the IRS. And if you think you’ve got it bad – think about all the professional tax preparers who have your frustrations times 1,000!
The IRS has simply chosen to ignore their responsibilities to the American taxpayers. While they refuse to even answer their phones their computers continue to generate automatic letters to taxpayers dunning them for interest and penalties that are undeserved. They have millions of last year’s returns to process and have no hope of getting you your refund in good order.
Join with 11 tax professional organizations in demanding that the IRS call off their dogs until they get their house in order!
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