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California Guardianship Law: Transferring Assets to a Non-Resident Guardian

  
  
  
  
  

describe the imageCalifornia guardianship law can be confusing and complex, and guardianship issues that involve a non-resident guardian can be even more complicated. If you have nominated a guardian who does not live in the United States, you should know that many aspects of the legal process are different, including how the non-resident guardian of the estate receives assets.

In California, the non-resident guardian must submit a petition to transfer assets to another country. In addition, the foreign jurisdiction (that is, the home country of the non-resident) must be made aware of the impending asset transfer.

Why do these rules exist? For the safety of the child. The State of California wants to ensure that the child’s welfare is not in jeopardy overseas, that the foreign jurisdiction is monitoring the child and guardian, and that the assets transferred across the border will in fact benefit the child.

Here are a few more things that you should know about transferring assets to a non-resident guardian:

  • Your petition should outline to the California courts that the guardian receiving the assets can be held accountable by the foreign jurisdiction.
  • You should understand that some assets, such as real property in California, may remain in state and could require a California-based guardian.
  • Your attorney will need to speak with legal counsel in the foreign jurisdiction so that he or she fully understands the correct procedure for informing the foreign jurisdiction of the asset transfer.
  • The California court is most interested in knowing that the minor’s rights and welfare will be protected by the foreign jurisdiction. Any information about the non-resident guardian and the guardianship process in the foreign jurisdiction may help assure the courts that the asset transfer is in the child’s best interests.

Keep in mind that there could be more than one guardian involved in your case: a guardian of the person, a guardian of the estate, or even a panel of guardians. There also may be a trustee. Understanding everyone’s role in caring for the child is vital to ensuring that the child is cared for, comfortable, and loved.

If you are nominating a non-resident guardian for your children, you may wish to consult with an experienced Palo Alto estate planning attorney. Call the Law Office of Janet Brewer today to arrange a private, confidential consultation: (650) 325-8276.

photo credit: Clarkston SCAMP via photopin cc

All the best,
Janet Brewer


Choosing a Foreign Guardian in California? Three Vital Clauses for Your Will

  
  
  
  
  

small 3531044626In our last blog post, we discussed the five clauses that every parent should include in their will to ensure that their children are raised safely and correctly – and by the friend or family member of your choice. In this post, we will discuss three more clauses that you should include if you are planning to nominate a foreigner as your permanent guardian.

 

  • Give your temporary guardian the power to file a petition for permanent guardianship for the your foreign guardian choice.  One of the issues that makes choosing a foreign guardian more complex is simply the problem of distance. After a sudden accident, it will take time for your permanent guardian to arrive in the United States and even more time for them to navigate the legal system. By giving your temporary guardian the power to file a petition for them, you can expedite and simplify the process.
  • Give the guardian nominee the right to petition for appointment in the guardian’s county. Again, this clause will simplify and expedite the process of your children being place with the guardian of your choice.
  • Give visitation rights to the foreign guardian nominee. Under California law, unless otherwise stated, the temporary guardian has complete discretion regarding visitation. Therefore, this clause ensures that your nominee for permanent guardian will be able to see and spend time with your children during the legal process leading to guardianship.

In addition to these clauses, you should also make certain that your temporary guardian nominee and your permanent guardian nominee know each other and understand what will happen in the event that you can no longer care for your children. If they have been introduced, are comfortable with each other, and understand your wishes, the chance that your children can seamlessly transition into their care increases.

Are you planning to nominate a foreign, non-resident guardian in your will? Choose a California attorney who has extensive experience in and knowledge about this area of law. To draft your will, or simply to learn more about guardianship in California, call The Law Office of Janet Brewer today: (650) 325-8276.

photo credit: James Jordan via photopin cc

All the best,
Janet Brewer


5 Guardianship Clauses You Need in Your California Will

  
  
  
  
  

small  4775276527Writing a will is one of the most important things that you can do for your children: you are ensuring that they will be taken care of after you are gone – both financially and emotionally. However, the time and effort that you put into your will won’t matter if you don’t write your will properly and with the assistance of an experienced attorney. Although a will is a binding legal document, it can prove powerless if it isn’t drawn up correctly or if you don’t take some of California’s guardianship laws into consideration during its creation.

To make certain that you wishes are executed correctly in the event of your death, be sure that your California will includes these five clauses:

  • Name a temporary guardian and an alternate temporary guardian. The temporary guardian is an important consideration especially for those who have chosen permanent guardians who live far away. Without a temporary guardian, your children may spend their first days without their parents with strangers instead of friends and family.
  • Name a permanent guardian and alternate guardian. Including an alternate guardian or two will ensure that even if something happens to your primary choice, your children will still probably be placed with someone that you are comfortable with. Also be aware that you can name separate guardians for the estate (the guardian who will care for your children’s financial issues) and the person (the guardian who will physically care for your children)
  • Explain why you have chosen your guardians. In California, the court system has the last word on who gets guardianship of your children, not you. The more information you include about why you have made this choice for your kids, the more likely the court will understand and comply with your wishes.
  • Explain why you haven’t chosen an obvious choice. If you fear that the court may choose someone other than your nomination, include a clause that explains why you don’t want that particular person to raise your child. This is not a place to be mean or vindictive, but simply to explain why a certain choice is not in the best interests of your child.
  • Outline any special instructions or important values. When you choose a guardian, you are taking a leap of faith that they will raise your children in an acceptable manner. But while you can’t watch over their every move, you can leave them with some general wishes or guidelines, especially regarding your family’s culture, religion, values, or ethics.

A California estate planner can assist you in writing all five of these clauses – along with the rest of your will. To get your questions answered about guardianship and estate law, or to request a private consultation, call the Law Office of Janet Brewer today: (650) 325-8276.

photo credit: .jocelyn. via photopin cc

All the best,
Janet Brewer


Qualified Domestic Trust (QDOT) Frequently Asked Questions

  
  
  
  
  

small  5299199423When an international couple comes into our office to plan their estate, they often have a lot of questions about qualified domestic trusts (QDOTs) – especially if they own a significant amount of property or assets. Below, we’ve shared the answers to the most common questions we answer during estate planning consultations in which one member of a couple is a non-U.S. citizen.

What is a QDOT?

A Qualified domestic trust is a very specific type of trust that may be created in the instance that a U. S. citizen would like to protect his or her assets from estate and gift taxes for a spouse, in the event of his or her death.

Who benefits from creating a QDOT?

QDOTs are ideal for international couples that have more than $5 million in assets. You do not need to create a QDOT if you and your spouse are both American citizens or if you and your non-U.S. citizen spouse do not have enough assets to be affected by federal estate taxes.

Do QDOTs have any rules or regulations?

Yes. QDOTs have a number of rules designed to keep large sums of money and property from someone who is not a citizen – at least before that money and property is taxed. For example, a QDOT must have at least one trustee that is a United States citizen, a domestic bank, or a domestic trust company. If the QDOT is worth more than $2 million, it must have a domestic bank for a trustee. In addition, the trustee must approve all principal distributions.

Can a spouse receive principal distributions from his or her QDOT?

Unfortunately, unlike many other marital trusts, a spouse cannot receive a principal distribution from the trust without having the money subjected to federal estate taxes. However, a spouse can receive interest distributions without having the money taxed (besides regular income taxes). One rare exception is if the spouse is undergoing a hardship and needs funds for a financial or medical emergency.

Can’t I just transfer money to my spouse before my death?

Unfortunately, because your spouse is not a United States citizen, any transfers over a certain amount is subject to a gift tax. If your spouse was a citizen, he or she could accept an unlimited amount of assets before your death.

Can we avoid creating a QDOT and still avoid the estate tax?

One alternative to creating a QDOT is to have the non-U.S. citizen spouse become a citizen. If this is possible, if you have the time to do so, and if your spouse wishes to become a citizen, this solution could well be preferable to the QDOT solution: when you are both citizens, you will receive an unlimited marital deduction: you will be able to transfer any amount of property and any assets between spouses, during your lifetime or in the event of a death, without being subject to gift taxes or estate taxes.

I still have questions about QDOT – what do I do?

To get all of your questions answered, and to ask questions about your personal situation, call The Law Office of Janet Brewer and request a consultation today: (650) 325-8276. We are dedicated to helping international couples plan their estates and plan their future.

photo credit: photosteve101 via photopin cc

All the best,
Janet Brewer


Recognizing the Signs of Special Needs Financial Abuse

  
  
  
  
  

describe the imageThis month we have been discussing financial planning for your special needs child as well as how to protect your child from financial abuse and financial issues after you can no longer care for him or her. One of the best ways that you can prevent the financial abuse of your special needs loved one is to make certain that both you and the people who care for your child recognize the signs of financial abuse.

Here are some of the most common red flags:

  • Your loved one is not receiving the care that he needs, or seems to be receiving less care than he should be able to afford.
  • Your loved one’s bills are not being paid, despite the fact that there should be money set aside specifically for these bills.
  • Your loved one is intentionally isolated from friends and family.
  • Some or all of your loved one’s valuable possessions have gone missing.
  • Your loved one’s financial statements show purchases that don’t make sense, such as ATM withdrawals far away from his location, or a gym membership your loved one couldn’t possibly use.
  • Your loved one cannot explain recent purchases, financial decisions, or changes to his will.
  • Your loved one has a sudden change of demeanor that cannot be explained.
  • A friend or relative takes a sudden interest in your loved one and/or their finances.
  • A friend or relative is using your loved one’s possessions or property without permission.
  • Someone offers your loved one lifelong care in exchange for property or other assets.
  • Bank statements and other financial information appear to stop arriving in the mail.

What should you do if you believe that someone with special needs is a victim of financial abuse? Document your concerns and talk to the appropriate authorities. You may also wish to alert family members that you trust about the situation.

One of the best ways to protect against special needs financial abuse is to create a great plan for your special needs child in the event of your death. Speak to a California estate planning attorney today to find out more about how you can plan for the future and protect your loved ones. Call The Law Office of Janet Brewer today: (650) 325-8276.

photo credit: Offutt Air Force Base via photopin cc

All the best,
Janet Brewer


International Estate Planning Decisions: Create a QDOT or Get Citizenship?

  
  
  
  
  

describe the imageIf you are married to a non-U.S. Citizen, estate planning in California is going to be more complex for you than it is for other couples, especially if you have a significant amount of property and assets. However, you do have two major options when it comes to preserving your wealth and making sure your spouse is well-supported even after your death: you can either create a Qualified Domestic Trust (QDOT) or have your spouse take the necessary steps to become a citizen of the United States. There are pros and cons to both choices. Let’s take a closer look.

The Benefits and Drawbacks to Creating a Qualified Domestic Trust

A QDOT is a trust that defers the federal estate tax after one spouse dies and ensure that even a non-U.S. citizen can inherit your assets following your death. This method is a good solution for couples who would be heavily penalized by the estate tax as well as couples in which one spouse does not wish to become a United States citizen for personal reasons (or cannot become a citizen for some reason). This method is also ideal because, while attaining citizenship can take years, a QDOT can be set up in much less time.

However, there are some drawbacks to a QDOT. First and foremost, your inheritance won’t be readily available to your spouse upon your death. Although your spouse can benefit from the trust, for example, by collecting interest accrued by the trust, your spouse does not have direct access to the funds. In addition, any interest earned by the trust is subject to income tax. Any funds taken directly from the trust are subject to estate taxes.

The Benefits and Drawbacks to Gaining United States Citizenship  

The second way that international couples can avoid estate taxes when one spouse dies is simply by having the non-U.S. citizen gain citizenship. When both spouses are United States citizens, they benefit from unlimited marital deduction: a rule that states that you can transfer an unlimited amount of assets and wealth to your spouse upon your death without facing an estate tax or gift tax. Taking advantage of unlimited marital deduction means not having to follow the strict rules associated with QDOTs. It also means that your spouse can freely access your assets after your death.

On the other hand, seeking out United States citizenship might not be an ideal solution for all international couples. First, the citizenship process can take years and involves a considerable amount of time and effort. Secondly, some people may not wish to become citizens, especially if they are from countries that do not allow dual citizenship. Thirdly, some non-citizens may not be able to become citizens for one reason or another.

Palo Alto estate planning for international couples

The Law Office of Janet Brewer is available to help you with your international estate planning, from making sure that your assets are protected from estate taxes when possible, to ensuring that your non-citizen spouse is cared for after your passing. To learn more about our legal services, or to request a consultation, call us today: (650) 325-8276.

photo credit: sarah sosiak via photopin cc

All the best,
Janet Brewer


Special Needs Trusts: Countable & Non-Countable Resources

  
  
  
  
  

small  7563304484One of the reasons you may fund a special needs trust for your child is so that they can have your financial support while also receiving needed government benefits, including Medicaid, Medi-Cal, and Supplemental Security Income (SSI). But in order for your child to receive means-tested government benefits, the money in your child’s special needs trust may only be used for certain needs, services, and items.

The trustee in charge of distributing funds to your child from his or her trust should clearly understand which resources count when the government calculates who is eligible for benefits. Specifically, to qualify for SSI benefits, your child must not have more than $2,000 in countable resources.

Countable resources include:

  • Cash.
  • Money in bank checking or savings accounts.
  • Personal property.
  • Vehicles other than your primary vehicle.
  • Stocks.
  • United States savings bonds.
  • Life insurance.
  • Land.
  • Property other than your primary residence.
  • Retirement accounts.
  • Investment accounts.
  • Deemed resources – a portion of the resources held by certain family members, such as a parent or spouse.

Non-countable resources include:

  • Your primary residence and the land it is on.
  • Household goods, such as furniture.
  • Personal effects, such as wedding rings.
  • Burial plots and burial funds (up to $1,500 each) for immediate family.
  • Life insurance policies with a combined value less than $1,500.
  • One vehicle, used for transportation.
  • Assets used to achieve self-support.
  • Educational funds, such as scholarships or grants, though they must be used within nine months of receiving them.

Understanding the difference between countable and non-countable resources makes your child’s trustee most able to help and provide for your child – and to make certain they are getting the care and support they need. To learn more about countable resources, as well as the SSI program, visit the United States Social Security website.

If you wish to set up a special needs trust for your child, or if you simply have questions for a California attorney about estate planning with a special needs child, contact The Law Office of Janet Brewer today: (650) 325-8276. 

photo credit: Offutt Air Force Base via photopin cc

All the best,
Janet Brewer


One Big Issue That Can Endanger Your Child’s Special Needs Trust

  
  
  
  
  

describe the imageOne of the major reasons to create and fund a special needs trust for your disabled child is so that your child can still receive means-tested government benefits, including Supplemental Security Income (SSI), Medicaid, and Medi-Cal. Because money kept in a special needs trust is not considered available to your child, it is not used to calculate your child’s eligibility for these government benefits, which help your special needs loved one to live comfortable and receive adequate medical care.

However, it is vital to understand that any money that your child receives, before or after your death, could prevent your child from receiving the government benefits listed above. While you might understand this, your friends and relatives may not. Years after you set up your special needs trust, a gift from your children’s grandparents or another loved one could undo your careful plan to financially support your child throughout his life.

The following assets could endanger your special needs child’s government benefits if they are paid directly to the child:

  • A monetary gift.
  • A gift of property.
  • An inheritance.
  • An IRA, 401K or other retirement benefits.
  • Life insurance.
  • Joint accounts.
  • Divorce settlement.
  • Child support payments.
  • Lawsuit settlement.

What can you do to make sure that your child’s government benefits are safe, even after you are gone? First and foremost, you can take action by letting all of your relatives, friends, and loved ones know that while financial gifts to your child are extremely generous and welcomed, they cannot be gifted directly to your child.

If your child has already received a financial gift, you will need to convert the assets into exempt or non-countable assets by transferring them to a first-party self-settled government-approved special needs trust. If you are not present to make certain this transfer happened, it is imperative that your child has a caregiver or trustee that understand what needs to happen and why.

Protecting the health and happiness of your special needs child after you are gone is of the utmost importance. Make sure that you have the correct trust in place – and a contingency plan in case the unexpected happens. To learn more about preparing your estate and planning for the future with a special needs child, contact The Law Office of Janet Brewer today: (650) 325-8276.

photo credit: Clarkston SCAMP via photopin cc

All the best,
Janet Brewer


Special Needs Trusts: Writing a Letter of Intent

  
  
  
  
  

describe the imageA special needs trust is vital if you are the parent or caretaker of a child (or adult child) with mental or physical disabilities. A trust can make certain that your child is cared for properly, that they have enough financial support to live a comfortable life, and that they can have financial security without the threat of losing their government benefits, such as Medicare or Supplemental Security Income (SSI).

However, while the trust itself is important, the optional Letter of Intent that often accompanies the trust can be just as important to the future health and wellbeing of your child.

The Letter of Intent is a document that can be made available to your trustees, your family members, your heirs, and your child’s caretakers. It can be changed and updated over time. Very simply, it outlines all information about your child that you believe is important to their health and happiness – information that your child may not be able to communicate easily himself.

Here is a sample of information that is commonly listed in a Letter of Intent:

  • Your child’s biographical information. Include your child’s general history, his personality, his family members, and any other important background information.
  • Your child’s medical history. Include the names of your child’s medical professionals, past surgeries, diagnoses, medications, and allergies.
  • Your child’s educational history. Include where your child has been educated and what kind of learning environment works best for him.
  • Your child’s financial needs/expenses. Include a list of regular expenses, including medication, food, shelter, and clothing. Note any and all special needs.
  • Your child’s skills and abilities. Include what your child is capable of, what he excels in, and what he needs assistance with.
  • Your child’s friends. Include a list of friends, community members, and family members that are a part of your child’s life. Don’t forget neighbors, school friends, and adults that might be important to your child.
  • Your child’s likes and dislikes. Many special needs kids have specific likes and dislike – for example, a child with autism may require certain types of comfortable clothes or follow a specific diet. Remember that no piece of information is too small.
  • Your family’s religious and cultural traditions. Include regular religious or cultural activities, family philosophies, and religious or cultural contacts and resources.
  • How to work with your child successfully. What might upset your child, and how is your child best disciplined? You know your child best and any information like this could help your child’s future caregivers greatly.
  • The goals and wishes you have for your child. Are you working toward your adult child living on his own, having a part-time job, or finishing high school? Make sure your goals are known by sharing them in this letter.

While the special needs trust itself will make certain that your child has financial support after you are gone, the attached letter of intent can ensure that your child’s caretakers and trustees know and understand your child, as well as your wishes for your child. A California estate planning attorney can help you draft a letter of intent and make sure that it contains everything it needs to help you child have a long, happy, and healthy life.

To learn more about special needs trusts, letters of intent, or estate planning with a special needs child in California, contact The Law Office of Janet Brewer today: (650) 325-8276.

photo credit: Clarkston SCAMP via photopin cc

All the best,
Janet Brewer


4 Considerations When Estate Planning With a Special Needs Child

  
  
  
  
  
small  4861626975

When we think about children with special needs, we often think of how they might need extra medical care, a different approach to their education, or simply a little more assistance as they navigate their life. However, it is also important to remember that special needs children (as well as many special needs adults) require special considerations when it comes to estate planning, trusts, and long-term care.

If you are just beginning to think about how you will care for and protect your special needs child after your death, here are five questions to consider as you make a plan: 

  1. How much financial support will your child need in order to receive sufficient care over his or her lifetime? How much support are you giving your child now, and how could that amount change over time, as your child grows into an adult and ultimately into a senior citizen? Will your child be able to support himself or receive government benefits? Will his medical issues or disabilities change or worsen over time? How much financial support will you be able to give?
  2. How will you protect your child’s government benefits? If your child receives Supplemental Security Income (SSI), Medicare, or Med-Cal, it is vital that the money you leave to them will not prevent them from receiving the benefits that they need. Often this means leaving your money to a third-party trust.
  3. How will you treat your other children equally in your will and trusts? While it is extremely important that your special needs child has his or her needs met after you are no longer able to be there, it is also important that your other children are treated fairly. This may be as simple as sitting down your family and explaining how you calculated the financial needs of your special needs child as well as how you plan to distribute your other assets fairly.
  4. How can you ensure that your child’s funds are properly managed and distributed after your death? Caring for your special needs child after you pass is not nearly as simple as leaving them a lump sum of money and a piece of property. Not only will you likely need to create a special needs trust, you will also need to choose a trustee that you know cares about and will care for your child. A shocking number of trustees have taken advantage of their responsibilities in the past, but there are steps you can take to prevent these issues.

A California estate planning attorney can help you answer all four of these questions – and make certain that you take all of the necessary steps to protect and care for all of your children even after your death. To learn more about special needs trusts, or to schedule a meeting with an experienced special needs trust lawyer, call The Law Office of Janet Brewer today: (650) 325-8276.

photo credit: Clarkston SCAMP via photopin cc

All the best,
Janet Brewer


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