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  • Wiils vs revocable trusts vs irrevocable trusts

    I'll be 60 in May and have never had a will. I need to change that. I have done reasonably well over the last 10 years or so, and currently have more assets and savings than I ever thought would be possible. I have a son and 3 grandchildren and would like them to get as much as possible of my estate (maybe "my stuff" would be a better term).

    I own a reasonably successful small business with no debt. I have a mortgage on a small strip center and my house with a pretty good equity. I have a good savings and other assets.

    What would be the best choice will-wise for someone in my situation?
    Phil

  • #2
    Methinks you should have a trust rather than a will. See if a friend or a friend of a friend can refer you to an estate planning attorney. The goal is to minimize estate taxes and avoid probate. Hope this helps!

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    • #3
      I don't know.

      Being of sound mind, I will have spent and enjoyed all my money.

      I'm certain my wife will survive me, so she gets to decide what to do with the instrument museum.
      'Never ascribe to malice that which can be adequately explained by incompetence.' --N. Bonaparte

      My friends call me Steve, won't you be my friend?
      The cast, in order of appearance:
      Kawai K5, Yamaha PSR-85, Thomas Trianon A-6820, Gulbransen 621-K, Conn 580 T-2, GEM WK1 ST
      Hammond H-112, Ser. #16518, from 8/16/1971
      Oh, and let's don't forget the Jaymar!

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      • #4
        You might look into a Beneficiary Deed for the real property. That avoided probate on my Mom's house. This probably varies with location.
        td

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        • #5
          Thanks guys!

          My CPA recomnded an attorney. I'll probably use him.

          The Beneficiary Deed sounds very interesting. I'll check into that.

          Other stuff came up and I still haven't done anything. Hopefully I can do something next week.

          I posted on this forum because many here are long in tooth. I figured many members had some experience with wills. Maybe not.
          Phil

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          • #6
            You really do need to seek the advice of competent people in YOUR state. There are major differences in successoral laws from one state to another.
            -----------------
            Johannus Opus 1100 (ca. 1990)

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            • #7
              Thanks, I didn't know that. I assumed it would be federal laws (IRS), but what you say makes sense.
              Phil

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              • #8
                Originally posted by ptsmith View Post
                Thanks, I didn't know that. I assumed it would be federal laws (IRS), but what you say makes sense.
                You have to meet the requirements of BOTH state and federal laws. Sometimes they are very different. Depending on the nature of the will and other instruments that you have drafted, your estate or the recipient will have to pay one or the other or both. That's why someone with both personal and business assets needs a good estate planning lawyer to suggest the best way to reduce overall tax hit for your estate and for your heirs.

                Some states and the federal govt. have exemptions from inheritance tax for assets passed on in a will. When my dad died (in North Carolina) about ten years ago, I think the maximum exemption was on the first $600,000.
                -----------------
                Johannus Opus 1100 (ca. 1990)

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                • #9
                  Thanks again! I was not aware of estate planning lawyers. I'll try to find someone that specializes in that field.

                  I looked into federal and state estate tax exemptions. it was a bit confusing, but it appears the limit is in the millions. If I'm understanding that right, my son won't have to pay anything. :o That hardly seems possible. I'll talk to the lawyer about it.
                  Phil

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                  • #10
                    MY parents passed away several years ago but before they did, they consulted an estate planning lawyer who drafted a Living Trust and a Spill-Over will for them. I was named the Executor of the trust. The trust made the disposition of their estate. including their home, quite straightforward. Sell the house, distribute funds to the heirs, and close the trust. The purpose of the Spill-Over will is to insure any acquisitions obtained after the trust documents are made revert back into the trust. As I recall, the cost to establish the trust was about $1500 and there were various lawyer costs during the administration of the trust. All in all, it proved to be a simple solution. No probate court, etc. Funds paid to heirs are taxable to them and IRS forms must be filed by the trust executor upon distribution of these funds.

                    This was in California but I can't say how it works in other states.
                    -----------------------------------------------------------------------------------------------------------
                    Keeping (too many) old organs alive.
                    Allen ADC 2110-T, Rodgers Trio 321B
                    Conn 651, 713
                    Hammond M-3 w/Leslie 120
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                    Mass-Rowe model 96 Carillon

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                    • #11
                      Thanks jep. More helpful info. Spill-Over is something I'll definitely want, as I don't plan on dying anytime soon (although you never know).

                      If my son is smart he'll keep my business (pawn shop) as it's very stable business to be in. Our customers are poor money managers. It doesn't matter if they're unemployed or have a great job, they still borrow money. So, my point is I'll need a will that's more geared towards that than liquidating everything.
                      Phil

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