CA Estate Planning Blog

Thursday, August 28, 2014

Is a Trust Right for You?

A trust is an estate planning tool that holds assets to be distributed after you die.  Most people think that you must be wealthy to benefit from the use of a trust in an estate plan. This is not the case, as there are many different types of trusts.  Some estate planning attorneys recommend that anyone with an estate worth over $100,000 and satisfying one of the following conditions should consider using a trust.  The conditions are as follows:

• A good amount of your assets are in the form of real estate, art or business holdings.
• You want to control how your assets are distributed to your beneficiaries.
• It is important to you that you provide your spouse with financial support after your death and also that your other beneficiaries inherit after your spouse passes away.
• You are worried that you might be subject to significant estate taxes and you want to reduce the liability as much as possible.  
• Your goal is to provide for a disabled beneficiary but want that beneficiary to continue to be eligible for government benefits.

No estate planning situation is the same and there are many different types of trusts that can be used in a wide variety of situations.

• Credit-Shelter Trust
A credit-shelter trust allows you to stipulate to leave a certain amount of assets (under the estate tax exemption) to a trust upon your death.  By then leaving the remainder of your estate to your spouse you can reduce or even avoid estate taxes.

• Dynasty Trust
A dynasty trust is created for the benefit of your grandchildren by allowing assets under the generation-skipping tax exemption to be passed to them tax free.  Your children can also benefit from trust income during this time.

• Qualified Personal Residence Trust (QPRT)
The QPRT trust allows you to transfer your residence or vacation home into the trust but continue to control it for a certain number of years.  The IRS values the asset at less than its current value as it assumes that your beneficiaries will not possess it for a while.  As long as you outlive the trust the home will not be included in your estate upon your death.

Trusts are complex legal documents that can assist in the preservation of assets if drafted correctly.  It is imperative to consult with a qualified estate planning attorney if you are considering a trust.  If you think a trust might be right for you call OC Wills and Trust Attorneys at (949)347-5256 for a consultation today.

Thursday, August 14, 2014

How to Avoid a Conservatorship

Becoming incapacitated is a common fear among those considering putting together an estate plan.  Who will take care of your needs is an even more frightening question.  Many people incorrectly believe that their loved ones are entitled to take over care immediately.  Someone has to be legally appointed to care for a loved one in the event they become incapacitated.  Also, not just anyone is allowed to manage a person’s finances if he or she is unable to do so.  An individual has to be appointed to assist with financial management in the same way as they do for personal needs.  This person can either be selected by the court or can be chosen in advance using certain estate planning documents.  

A conservatorship is a legal proceeding in which a court chooses a person or organization to care for an incapacitated adult and/or manage their finances.  A conservator can be selected for one need and not the other or to fill both roles.California has different types of conservatorships including a general and limited conservatorship, as well as one for the purpose of caring for a mentally ill individual.  A conservator of the person tends to the personal needs of the incapacitated such as making living arrangements, arranging for meals and housekeeping.  A conservator of the estate is chosen to handle the incapacitated person’s finances.This person controls the income, assets and expenses of the person subject to the conservatorship.

Just like many other legal proceedings, conservatorships can be long, drawn out, expensive and emotionally trying. Luckily, all of this can be avoided by a small amount of pre-planning.  Health care directives can circumvent the need for a conservator of the person and a durable power of attorney can be used to avoid the need for a conservator of the estate.  Going to an estate planning attorney saves beneficiaries money that would otherwise go towards legal fees in the event that a conservatorship becomes necessary.  This also allows a person to maintain a certain amount of control over who cares for them in the event of incapacity.

If you are interested in discussing a durable power of attorney and a health care directive, or have any other estate planning or asset protection questions, call Brian Chew at (949)347-5256.

Thursday, July 31, 2014

Financial Advantages of a Revocable Living Trust

Revocable living trusts  are estate planning tools that have become very popular in recent years mostly because of the financial advantages they offer.  A trust is a vehicle in which property is held for the benefit of another person.  A living or inter vivos trust is one created during an individual’s lifetime as opposed to upon their death.  A trust is revocable when the grantor (creator of the trust) has the freedom to change the trust terms throughout their life.  Assets held by the trust are managed by an individual, known as the trustee, who is appointed by the grantor.

There are many benefits to the use of a revocable living trust in your estate plan.  Although you should always speak to a qualified attorney before creating a trust to ensure that it is drafted correctly, some of the advantages are as follows.

Revocable living trusts avoid probate.  Probate is the legal process by which a last will and testament is validated.  Assets held in a revocable living trust pass immediately to beneficiaries upon the grantors death.    By passing your assets via a revocable living trust instead of a will, you can avoid the costly and lengthy probate process.  In the case that you own property in more than one state and hand down your assets by will, ancillary probate will be necessary.  Ancillary probate is the process of validating a will in another state where property is owned.  This can be even more expensive and time consuming than the standard probate process.  Using a revocable living trust to distribute these out of state assets will also eliminate the need for ancillary probate, saving your heirs time and money.

This type of trust offers the grantor a large amount of control over their assets throughout their life.  By naming themselves as trustee, the grantor can manage the assets in the trust as long as they are competent, enabling them to make financial decisions that will grow their wealth over time.  

A revocable living trust also enables the grantor to appoint a co-trustee that will manage the trust assets in the event that the grantor trustee becomes incompetent.  If you have not designated someone to handle these affairs via a revocable living trust or another method, a conservatorship proceeding could be necessary.  These proceedings are also quite expensive and can be avoided by the use of a revocable living trust, preserving money for your heirs.

If you are interested in the financial advantages of a revocable living trust, call Brian Chew at (949)347-5256.

Thursday, July 17, 2014

Important Estate Planning Steps for Newlyweds

Are you newly married?  The honeymoon isn’t even over yet, but, one of the first things you should think about is estate planning.  People are getting married later in life and may have amassed a large amount of assets before entering into their first nuptials.  That is why it is important to understand how your marriage affects the way your estate will be handled and to create an estate plan with these considerations in mind.  Newlyweds can do certain things to create a comprehensive estate plan and should always start this process by discussing everything with their new spouse.

Update Beneficiaries on Accounts
One of the easiest ways to start the estate planning process is to change the beneficiaries on your financial accounts.  These accounts include banking, investment and retirement accounts.  You should also talk to your spouse about who you would want to inherit from your estate should something happen to both of you.

Last Will and Testaments
You should execute or update your will.  A will instructs how you would like your property distributed after you die.  In most cases, spouses name each other as beneficiaries to each other’s estates.  But, this might not be right for you.  You should consider other beneficiaries such as existing children, parents and other loved ones if you would like them to inherit from your estate.
Discuss it with your spouse and decide how you would like your assets distributed in the event of your death or if both of you die.  

Durable Power of Attorney
If you and your spouse want to be able to make personal and financial decisions on each other’s behalf in the event of incapacity, you should appoint each other in reciprocal durable powers of attorney.  You should also check with your account holders to determine if you will need additional paperwork for the appointments to apply to specific financial accounts.

Advanced Directives
You and your spouse should also be sure to discuss end of life issues.  You should each document your wishes in advanced directives and appoint each other as health care proxies if you decide that is the best course of action.

If you have a sizeable estate and/or own a lot of property, you should discuss with your attorney the best way to title your assets and the possibility of using a trust in your estate plan.  Whenever you have a major life event, i.e. marriage, children, divorce, death of a loved one, you should think about how this affects your estate plan. It is in your best interest to consult with an experienced attorney on these matters such as the Orange County, California attorney Brian Chew.  Call OC Wills and Trust Attorneys at (949)347-5256 for a consultation today.

Friday, June 27, 2014

Supreme Court rules that Inherited IRA's provide no asset protection in Bankruptcy

The Supreme Court has ruled in the case of Clark v. Rameker that inherited IRA's (i.e. and IRA/401k account that you receive from your parent's estate) do not have the same creditor protection as an employer funded 401k or a self funded IRA.  As a result, the funds held in an inherited IRA's can be attached by creditors in a bankruptcy proceeding.  

This ruling should result in an increase in the use of an IRA Beneficiary Trust as a vehicle in which the inherited IRA can reside for the lifetime of your heirs and while the funds are held within the trust, it is unavailable to your heir's creditors.  

Friday, January 3, 2014

New Year's Resolutions: Estate Planning

Happy 2014!  Now that you've rung in the new year with a bang, it's time to get your to-do list of resolutions out and start acting on them! 2014 is a year of big changes in the legal world, so we here at OC Wills & Trust Attorneys encourage you to stay on top of these legal issues as they may affect your pocketbook. 


If you don’t have an estate plan in place, now is the time to put one in place.  If you already have a plan, now is the time to do an estate plan review.  As time passes, many things in your life change, and those changes can have a drastic impact on your estate plan wishes.  Not sure where to begin?  Take a look at the list below. 

Do you have any assets?
Do you have children?
Are you married?
Are you divorced?

During our free consultation appointment an OC Wills & Trust Attorney will gather information about you, your family, your assets and your wishes.  They will review your estate planning options, identify the estate planning documents that will best fit your needs and tell you how much it will cost to prepare the documents.


Educate yourself on the facts of the Affordable Care Act, and how it can affect you in this upcoming year. Beginning in 2014, most Americans who lack insurance will have to pay a penalty under Obamacare -- a penalty that's set to increase annually for some uninsured individuals.


The staff at OC Wills & Trust Attorneys wish you a New Year filled with peace, prosperity and happiness.

Tuesday, December 17, 2013

25 Important Documents to Keep Safe/Handy Before You Die

The Wall Street Journal has a great article on the 25 most important documents you need to have before you die. I highly recommend you reading the whole article as they make some great points. 


  • Will
  • Letter of Instruction
  • Trust Documents


  • List of all bank accounts
  • List of all usernames and passwords
  • List of safe deposit boxes


  • Housing, Land and Cemetery Deeds
  • Escrow mortgage accounts
  • Proof of Loans made and Debts Owed
  • Vehicle Titles
  • Stock Certificates, Savings Bonds and Brokerage Accounts
  • Partnership and Corporate Operating Agreements
  • Tax Returns


  • Personal and Family Medical History
  • Durable Health Care and Power of Attorney
  • Authorization to Release Health Care Information
  • Living Will
  • Do Not Resuscitate Order


  • Life Insurance Policies
  • Individual Retirement Accounts
  • 401(k) Accounts
  • Pension documents
  • Annuity contracts


  • Marriage license
  • Divorce papers

Tuesday, December 3, 2013

Holiday Estate Plan

What is the greatest gift you can give your family this Holiday Season?

Peace of mind.  Getting your Estate Plan in order is not always at the top of everyone’s to do list, but it should be.  With the proper legal documents in place, you can help ease the difficulties that your loved ones will face upon your incapacity or passing.  Your assets can be managed by someone you trust.  Your children can be cared for by someone you know will treat them well.   Your money will be available for your loved ones when they need it and will be easily accessible.  In short, you will provide security and stability for those you care about most when they are dealing with a great loss.

Here are some of the common issues and questions we encounter:

I don’t want to consider something bad happening to me.

You don’t think about getting into a car accident every day, but you buy auto insurance just in case.  Planning for issues that might arise doesn’t make bad things happen, it mitigates the damage when they do.   If your Estate Plan is complete then you don’t have to continue to focus on it and expend energy needlessly.  It becomes the equivalent of auto insurance and when life changes or new drivers are added you might have to review your policy and make adjustments but you will be protected in the meantime.     

Why do I need an Estate Plan?

Generally speaking, if you have assets in excess of $150,000 or have young children, you need an Estate Plan to avoid the Probate process.   In the absence of valid legal Estate Planning documents your loved ones will have to petition the Probate Court to determine what will happen to your assets or your children.  The Probate process can be difficult, overwhelming, costly and lengthy.  

What does an Estate Plan include?

Living Trust – a legal document that directs your successor Trustee to carry out your wishes with regard to your finances, your children, your health and your legal affairs.  The power of a Trust is that it allows your assets to pass directly to your beneficiaries without going through Probate.

Pour Over Will – allows a decedent’s nominal assets to be included in their Trust.

Healthcare Directive – allows you to appoint someone to decide about your medical treatment if you cannot decide for yourself and gives them parameters regarding your wishes.

Durable Power of Attorney – allows you to name an agent to act on your behalf and carry out your financial affairs.

How do I go about doing my Estate Plan?

Sometimes tasks seem more daunting than they really are because we don’t know what is involved in the process or where to begin.  Getting your Estate Plan in order is simple.  Consider the ages of your children, think about what you would want to happen to them if something happened to you tomorrow, or 10 years from now.  Determine who you would want to act in your stead, with regard to your finances and your healthcare.  Take stock of your assets: homes, cars, boats, IRA’s, 401k’s, Life Insurance, etc., and decide how you would want them divided.  Consider what quality of life you would want if something happened to you. 

How do I get started?

Contact our office, make an appointment for a consultation and give the gift of peace of mind to your family this Holiday Season.


Happy Holidays from all of us!

Wednesday, November 6, 2013

What Happens If You Forget to Put An Asset into Your Trust? A Pour-Over Will Can Help

What happens if I forget to put an asset into my Trust? This is a question that many of our clients ask during our meetings.


Legally, if an asset was not put into the trust by title or named to be in the trust, then it will go where no asset wants to go…to PROBATE. The probate court will take much longer to distribute this asset, and usually at a high expense. Sometimes, attorneys can file what is called a Heggstad Petition in which they claim that it was the Trustor’s INTENT to put this asset inside the Trust. The Court may or may not grant this request, depending on whether the Trust was correctly set up, if any of the assets were left out of the Trust and what documentation is available to prove that this was the Trustor’s intent. This, too, takes a more complicated route to get the asset where it needs to be. Therefore, our office provides a built in legal document that helps prevent this from happening.


In our living trust package, we provide not only a Living Trust, but a Pour-Over Will. What is a Pour-Over Will? A Pour-Over Will is basically a “catch-all” protective document that is intended to guarantee any assets which somehow were not included in the trust becomes assets of the trust upon the Trustor’s death.


The advantage of the pour over will is that it will take care of the assets that you don’t get around to transferring to the trust before your death. The disadvantages of the pour over wills is that that property will have to go through probate, and this force the living trust to go on longer after the death of the Trustors. However, most properties will not have to pass though the pour over will if you have a good estate plan and have transferred all the most valuable assets to the trust while you are alive and well. The pour over will should only catch all the leftover things that are of minor value and if the estate that is left outside the Trust is small enough, you may qualify for the Special Small Estate Probate Procedures. This procedure is simpler and less expensive than going through regular probate. 

If you have questions regarding this Pour Over will and our Living Trust Package, please don't hesitate to contact our office at 949-288-3598 or and we will be happy to assist you. 

Tuesday, October 8, 2013

Common Questions on Probate

Common Questions: What is Probate and What Goes Through Probate?

When a loved one passes away in California, his or her estate often goes through a court-managed process called probate or estate administration where the assets of the deceased are managed and distributed.  California probate is not particularly onerous, and many families can avoid probate altogether if their estate is small enough, but it does have one huge drawback: it’s extremely expensive.

The length of time and cost needed to complete the probate of an estate depends on the size and complexity of the estate and the local rules and schedule of the probate court. 

Every probate estate is unique, but most involve the following steps:

  • Filing of a petition with the proper probate court.
  • Notice to heirs under the Will or to statutory heirs (if no Will exists).
  • Petition to appoint Executor (in the case of a Will) or Administrator for the estate.
  • Inventory and appraisal of estate assets by Executor/Administrator.
  • Payment of estate debt to rightful creditors.
  • Sale of estate assets. 
  • Payment of estate taxes, if applicable.
  • Final distribution of assets to heirs.

 If your loved-one owned his or her assets through a well drafted and properly funded living trust, it is likely that no court-managed administration is necessary, though the successor trustee needs to administer the distribution of the deceased's assets. 

Does probate administer all property of the deceased?

One of the most common questions about probate is what property is exempt from probate, and what property must go through probate.  Probate is primarily a process through which title is transferred from the name of the deceased to the names of the beneficiaries. 

There are certain types of assets are what is called “non-probate assets” do NOT go through probate.  These include:

  • Property in which you own title as “joint tenants with right of survivorship”.  Such property passes to the co-owners by operation of law and do not go through probate.
  • Retirement accounts such as IRA and 401(k) accounts where there are designated beneficiaries.
  • Life insurance policies.
  • Bank accounts with “pay on death” (POD) designations or “in trust for” designations.
  • Property owned by a living trust.  Legal title to such property passes to successor trustees without having to go through probate.


How much does probate cost?  How long does it take?

Common expenses of an estate include executor fees, attorney fees, accounting fees, court fees, appraisal costs, and surety bonds.  These typically add up to 2% to 7% of the total estate value. Most estates are settled though probate in about 9 to 18 months, assuming there is no litigation involved. California is one of the few states that allow lawyers to charge a statutory fee, which is an amount that is a percentage of the value of assets that go through probate.  The current rates for California Statutory Probate fees are:

  • 4% of the first $100,000 of the gross value of the probate estate
  • 3% of the next $100,000
  • 2% of the next $800,000
  • 1% of the next $9 million
  • .5% of the next $15 million

In addition,  the cost and duration of probate can vary substantially depending on a number of factors such as the value and complexity of the estate, the existence of a Will and the location of real property owned by the estate.  Will contests or disputes with alleged creditors over the debts of the estate can also add significant cost and delay. 

Bear in mind that simply having a will does not necessarily circumvent the probate in California.  While a will is helpful in determining how your estate is to be distributed, it is still a mandated court process in which the courts will determine its validity and pay any outstanding debts from the estate before any of the remaining assets can be distributed to the beneficiaries. Contact your California estate planning attorney if you have more questions on how to avoid probate. 

Wednesday, October 2, 2013

Divorce and Estate Planning

There are a variety of factors to consider when you get divorced. Although the number of items to take care of can feel overwhelming, some are more important than others. Consider this, if something were to happen to you today the person who would most likely make health care decisions for you is the same person that you are divorcing. Frightening thought. In order to avoid this reality, it is crucial to revisit your Estate Plan when you file for divorce.

Your Estate Plan refers to what you want to have happen to your person, your assets and your children when you cannot make those decisions for yourself, or when you are no longer here. These decisions will be carried out through the Trustee of your Living Trust; the Executor of your Will; the Agent of your Health Care Directive and the Agent of your Power of Attorney. For married couples the most common designation of Trustee, Executor and Agent is their spouse.

While the law is smart enough to automatically revoke the appointment of your spouse as your Power of Attorney, Health Care Agent, Trustee and Executor upon divorce, the filing for separation does not have the same effect. That is why it is critical to revoke any previous determinations and memorialize any of your new wishes as soon as you file for divorce.

Here are some of the questions to think about:


  • Do you have children?
  • Who will your things automatically go to if you don’t take care of your Estate?
  • Who do you want your things to go to?


  • What assets do you have now?
  • What assets will you have when your divorce is final?
  • How difficult will it be for your loved ones to access your assets?


  • What will your custody agreement look like?
  • Will your ex-spouse automatically receive custody of your kids if you are gone or incapacitated?
  • Who will take care of your children if both you and your ex-spouse are gone?
  • Will the guardian for your children be able to financially support your children?


  • Who can you count on to make decisions about your health?
  • Will that person know what your wishes are?


  • Who can you trust with your assets?
  • Will that person know what your wishes are?


These are just some of the questions you will want to ask yourself when you divorce, but like many situations it’s just the tip of the iceberg. You should consult an experienced attorney that can help walk you through these issues.

Archived Posts


© 2020 OC Wills and Trust Attorneys | Disclaimer
15615 Alton Parkway, Suite 450, Irvine, CA 92618
| Phone: 949.347.5256
26050 Acero, Mission Viejo, CA 92691
| Phone: 949.347.5256
17011 Beach Blvd, #900, Huntington Beach, CA 92647
| Phone: 949.347.5256
2522 Chambers Road, Suite 100, Tustin, CA 92780
| Phone: 949.347.5256

Overview | | Practice Areas | Resources | FAQs | About Us

FacebookTwitterLinked-In CompanyYouTube

Attorney Web Design by
Amicus Creative