The Purpose of Planning ` Obstacles: Probate &Taxes ` Basic Estate Planning 101 ` Complex Estate Planning 101 ` Asset

Protection Planning 101
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-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

«to manage assets during life; ` «to manage responsibilities and assets during incapacity; and ` «to properly care for and distribute estate upon death.
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-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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Probate
«a court-supervised process to transfer assets from a deceased individual to a beneficiary. Extremely expensive. Extremely complicated / lengthy.

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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Case Studies:

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Conservatorship / Guardianship Hearings (Probate Court)
Without an estate plan, a court will determine if you are incapacitated, and if so, who is to care for you and your children.

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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Case Study:

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Taxes
Estate Taxes
x «approximately 50% tax on net worth upon death.

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

Capital Gains Taxes
x «tax on profit upon sale of property.

Income Taxes
x «easily reduced through advanced planning opportunities.

Keep The Goals, and The Obstacles in Mind ` Estate Planning Options
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-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

«do nothing at all. «create a Will. «own property jointly with another. «create a living trust / comprehensive estate planning package.

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Doing Nothing at All
No tax planning opportunities; No protection upon incapacity; No asset protection after death; No decision on how to distribute estate; and Full probate (with associated fees and delays).

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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Create a Will
Same results as if doing nothing at all, EXCEPT you can choose how estate is distributed. That is all.

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Jointly Owning Property
No tax planning opportunities; No protection upon incapacity; No asset protection after death; and Increased liability; BUT No probate (which is good).

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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Living Trust / Comprehensive Estate Plan
Protection upon incapacity; Asset protection capabilities (limited); Ability to appoint individuals to act as agents upon incapacity and death; Complete authority to plan distribution. No probate. (SOLVES ALL OF THE ISSUES RELATING TO ESTATE PLANNING)

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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How a Comprehensive Plan Operates
«Living Trust is at the core;
x Separate entity to hold assets that survives your incapacity and death, upon which designated successors take over, and our bound to specified terms and conditions;

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

«Powers of Attorney / Advance Healthcare Directives;
x Documents to appoint agents to act on your behalf.

«Pourover Will
x Document which appoints guardians for your children (among other things).

«Ancillary Documents (Supportive and Extra Protection).

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Specific Situations
«special needs beneficiaries; «business interests; and «investment properties, etc.

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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The Estate Tax
«50% tax on one¶s net worth upon death.
x $1,000,000 exclusion

«many vehicles exist which can structure assets in a manner which allows them to not meet the definition of ³net worth.´

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What Does Asset Protection Do?
The effect is to essentially make it difficult for creditors to come after the client. Most plans take jurisdiction out of state or country, making it expensive for creditors. EXCEPTION: Creating an LLC or Corp. is almost always a sure bet (in limited circumstances).

-Purpose of Planning -Probate and Taxes -Basic Estate Planning 101 -Complex Planning 101 -Asset Protection 101

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Fraudulent Transfer Rule
«cannot engage in asset protection for the sole purpose of defrauding creditors. «can do it ahead of time to protect yourself.

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