Well , I’ll Get Around to it . . .

1. Well , I’ll Get Around to it . . .

2. WHO NEEDS AN ESTATE PLAN? EVERYONE!

3. PURPOSE OF PLANNING • Lifetime issues • Family issues • Wealth protection • Tax avoidance

4. WHAT DOES AN ESTATE PLAN INCLUDE? • Will • Statement of Disposition of Tangible Personal Property • Revocable Trust • Life Insurance/ Irrevocable Trust • Durable General Power of Attorney • Durable Health Care Power of Attorney • Organ Donation / Cremation and Funeral Instructions • Beneficiary Designations • Re-titling of Assets

5. WHERE THERE IS NO WILL • No named beneficiaries • No named guardian • No named personal representative • No testamentary trust

6. THE WILL • The will is the instrument that directs how your assets are to be distributed after your death. • Personal representatives • Q-tip trust • Family trust

7. GUARDIANS For people with minor children, this is the most important reason for establishing an estate plan.

8. REVOCABLE OR “LIVING TRUST” • Trust Agreement • Pour-Over Will

9. WILL VS. REVOCABLE TRUST • Tax planning • Organize now or later • Administration

10. BENEFICIARIES • THIS IS A BIG ISSUE • Children • Charities • Other family members

11. IF YOU HAVE A REVOCABLE TRUST . . . Is it funded?

12. GENERAL DURABLE POWER OF ATTORNEY • This document handles your financial matters. • Date of Document • When does it become effective

13. GENERAL DURABLE HEALTH CARE POWER OF ATTORNEY • You appoint someone to make health care decisions for you when you are unable • Includes the “living will” • Cremation/burial instruction

14. STATEMENT OF DISPOSITION OF TANGIBLE PERSONAL PROPERTY

15. BENEFICIARY DESIGNATIONS • Properly designating beneficiaries of Retirement Plans at death is an important part of the estate planning process • For many, this is the largest asset • Children as beneficiaries

16. LIFE INSURANCE • Liquidity – taxes, succession planning • Creating estates • Replace income • A lot of insurance • Not enough insurance

17. IRREVOCABLE TRUSTS for Life Insurance

18. TITLING OF ASSETS • TENANTS IN COMMON • JOINT TENANTS

19. BENEFICIARY DESIGNATIONS • IRAs • LIFE INSURANCE • 401(k)s

20. WHAT IS A PROBATE? The purpose of probate is to transfer assets and deal with the creditors of the decedent.

21. DIVORCE Ownership of real property by a husband and a wife as joint tenants changes to ownership as tenants in common if the couple is divorced. After a divorce if one marriage partner dies before changing the title to the property, the decedent’s interest in the property automatically passes to his or her heirs rather than to the former spouse.

22. DIVORCE (continued) • A divorce terminates the right of a former spouse to inherit under the will. • A divorce or dissolution of marriage revokes bequests and devises to a former spouse – but not the will itself. • A divorce revokes the appointment of the former spouse as an executor or trustee under the will. • Watch out for insurance beneficiaries!

23. MINOR CHILDREN • Appointment of a guardian • Establishment of a trust – minor children cannot inherit outright

24. DISABLED CHILD Supplemental Needs Trust

25. THE FIRST RULE IN ESTATE TAX PLANNING: Fully utilize the Unified Credit

26. UNIFIED CREDIT

27. ENTITY CHOICES…

28. LIMITING LIABILITY • Entity Choice • Liability insurance

29. ENTITIES THAT LIMIT LIABILITY • Corporations • Limited Liability Companies

30. LIABILITY INSURANCE Look at your umbrella Pays for the lawyer

31. FACTORS TO CONSIDER IN CHOOSING ENTITY TYPE • Tax considerations • Operational flexibility/compliance • Ease of liquidity • Future fundings

32. C CORPORATIONS annual compliance double taxation most familiarity

33. S CORP special election flow through limited to 75 shareholders/ US residents Tax liability even if no cash from corp.

34. LLCs Flow through fewer formalities/operational flexibility operating agreement managers transfer of appreciable assets to members

35. FOR MORE INFORMATION REGARDING PLANNING, CONTACT: Cristy J. Carbón-Gaul 505-899-5696 cristy@carbon-gaul.com