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What happens when you die without a will · The Legal Exchange

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Speaker 1: This is the Legal Exchange with Todd Lutsky from the
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Speaker 1: law firm of Cushing and Dolan and Susan Powers of
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Speaker 1: the Armstrong Advisory Group. Each week, Todd and Susan will
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Speaker 1: discuss many topics including estate planning, how to avoid probate,
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Speaker 1: and protecting your money from a nursing home. If you
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Speaker 1: need assistance in any of these areas, or have a
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Speaker 1: question about another issue that may affect your future, call
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Speaker 1: eight six six eight four eight five six ninety nine
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Speaker 1: to make an appointment. That's eight sixty six eight four
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Speaker 1: eight five six ninety nine. Operators are standing by. Now
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Speaker 1: Here are your hosts, Tod Lutsky and Susan Powers.
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Speaker 2: Welcome into the Legal Exchange with Todd Lotsky. I'm Susan Powers,
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Speaker 2: of financial Advisor with the Armstrong Advisory Group and I'm
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Speaker 2: joined by Todd Lutsky, a partner with the law firm
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Speaker 2: of Cushing and Dolan with a master's in taxation. Welcome Todd,
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Speaker 2: how are you today?
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Speaker 3: I am never better? And Welcome to November.
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Speaker 2: Had to bring the party down, didn't she.
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Speaker 3: That's right, I do. We're going to bring it up
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Speaker 3: because we've got a couple of interesting cases. One basically
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Speaker 3: is a Mississippi appelle tax court case, and the best
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Speaker 3: way to describe it is to say, when are you
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Speaker 3: an air and when are you not an air? Right?
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Speaker 3: So this is a situation where someone died intest state
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Speaker 3: and husband and the husband and the sons all predeceased,
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Speaker 3: so there was only two illegitimate grandchildren that were kicking around,
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Speaker 3: and so are they in or are they out? So
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Speaker 3: stay tuned, folks, because planning, of course, is key to
1:41
Speaker 3: not making these mistakes. And where the heck was your
1:44
Speaker 3: head when the red flag went off where you lost
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Speaker 3: your whole family? It might be time to do some planning,
1:48
Speaker 3: I would, I would think. Anyways, we then head over
1:52
Speaker 3: to my old stomping grounds, Ohio, and we have an
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Speaker 3: appellate court case there that basically says, how do we
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Speaker 3: handle business assets? Do we want to get this business
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Speaker 3: succession to either family members kids? Do we need a
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Speaker 3: buy sell agreement? So important to deal with family? Do
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Speaker 3: we sell it? Do we do a promisory note? How
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Speaker 3: do we plan when we're dealing with business assets? We
2:21
Speaker 3: talk a lot about real estate. This is an important
2:24
Speaker 3: asset too well. Part of planning this month is really
2:28
Speaker 3: going to be great because it is actually another it's
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Speaker 3: a brand new guide. In it's true brand brand new guide.
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Speaker 3: We've decided to put together really underutilized trust called the
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Speaker 3: Simplicity of joint revocable trusts. Never mind the two trust approach.
2:49
Speaker 3: Never mind dividing assets between husband and wife's trust and
2:52
Speaker 3: trying to fund them complicated and balance the assets between
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Speaker 3: both sides. No one simple trust for moderate estates. By
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Speaker 3: the way, moderate estates are somewhere around fifteen million nowadays
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Speaker 3: with the exemption so high, So that's big. You put
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Speaker 3: it in this trust. It is and you can now.
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Speaker 3: And the other benefit is not only simplicity of funding
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Speaker 3: an operation, but it allows you to cram down twice
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Speaker 3: as many assets on the first death as you could
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Speaker 3: if you split them between two trusts. Allows you to
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Speaker 3: get a full step up in basis on the first
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Speaker 3: death and maybe a second double step up in basis
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Speaker 3: on the second death. Folks, please get the guide Understand
3:35
Speaker 3: how to use revocable joint trusts Brand New Guide for
3:40
Speaker 3: the month eight six six eight four eight five six
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Speaker 3: nine nine or Legal Exchange Show dot Com again eight
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Speaker 3: six six eight four eight five six nine nine or
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Speaker 3: Legal Exchange show dot com. Now let's head over to
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Speaker 3: uh Mississippi. What do we got going on here? When
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Speaker 3: are you an heir? Well, let's see, Francis died intestate
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Speaker 3: without a will yeap February twenty twenty two, husband and
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Speaker 3: two sons had already predeceased her. Then, however, her son
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Speaker 3: Laddell had died right but had two illegitimate kids, Angela
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Speaker 3: and Dexter.
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Speaker 2: So meaning he wasn't married to the mom, correct? Is
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Speaker 2: that your legal definition of that?
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Speaker 3: Correct? And therefore their grandkids. Well, Angela had been assisting
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Speaker 3: with Francis's with her medical care, her financial affairs. Angela
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Speaker 3: was even named as a beneficiary on the life insurance
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Speaker 3: policy and listed as a granddaughter.
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Speaker 2: Okay, so she had a relationship with.
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Speaker 3: Her seems good. February twenty twenty three, Jim Francis's nephew
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Speaker 3: appointed as administrator of the estate. Angela then files a
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Speaker 3: motion to intervene, claiming to be the granddaughter, while other
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Speaker 3: nieces and nephews also file emotion to determine airship. Makes sense.
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Speaker 3: While the court determined that Angela and Dexter were in
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Speaker 3: fact heirs and substituted them as administrator of the estate. Well,
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Speaker 3: as you might imagine, the nieces and nephews weren't thrilled
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Speaker 3: about this. So they filed a motion to amend and
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Speaker 3: alter this because they believed that there was an error
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Speaker 3: of law made. Why because the statute of limitations to
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Speaker 3: determine paternity has passed. So they denied. They got so
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Speaker 3: they got denied. Right, So because now the nieces and
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Speaker 3: nephews the court still said, no, they're heirs, and you're
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Speaker 3: denied this. Nieces and nephews, you waived that affirmative defense
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Speaker 3: long ago. Well, they didn't like that, so they appealed.
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Speaker 3: The appellate court reversed and as much as you don't
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Speaker 3: like it, remanded the case back to the to the appellates,
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Speaker 3: to the court, back to the district court. Why well,
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Speaker 3: the state laws of Mississippi allow illegitimate kids to inherit
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Speaker 3: under the intestacy laws from and through their natural father.
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Speaker 3: So these kids were the natural father of Laddell. Such
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Speaker 3: paternity actions does need to be filed within one year
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Speaker 3: of the death of the father. Here, she waited seventeen
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Speaker 3: years to file. Only after Francis died did she file.
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Speaker 3: Because Francis was the grandfather or grand right, So they
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Speaker 3: remanded the case. But sounds like they're probably going to lose,
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Speaker 3: but not entirely sure how that's going to play out.
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Speaker 3: But folks, that's not why I tell.
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Speaker 2: You Francis had done her planning.
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Speaker 3: That's really where we're at, right, Not only Francis has
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Speaker 3: done their planning. But you're right, how would these these
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Speaker 3: grandchildren you know, want to be filing an action when
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Speaker 3: Grandma is still alive. It wouldn't have made sense, right,
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Speaker 3: But but they had to because their father had died already.
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Speaker 3: Remember Ladell was there father?
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Speaker 2: What would ever inspire you to do that kind of
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Speaker 2: paternity testing and file that I know seventeen years ago
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Speaker 2: when he's dead now?
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Speaker 3: Unfortunately not knowing is not an excuse, right, So how
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Speaker 3: does this work? What's the lesson here? The lesson here,
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Speaker 3: as you said, Susan, is obviously take matters into your
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Speaker 3: own hands, right, do some planning for goodness sake? So
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Speaker 3: the intestacy statute here says if you die without a will,
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Speaker 3: then you look at the state statute to see who's
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Speaker 3: next in line? And why is that important in this case? Right?
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Speaker 3: So generally, when you die you look to see a
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Speaker 3: spouse and kids are usually next in line. Mm hm,
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Speaker 3: well here the spouse and the kids predeceased Francis Okay,
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Speaker 3: so next you would look to grandkids. Ah, therefore Angela
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Speaker 3: and Dexter would be in right because they would take
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Speaker 3: before we get to nieces and nephews. See how this
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Speaker 3: plinko ball works. So after that, if there's no grandkids,
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Speaker 3: they look to siblings. If there's no siblings, then probably
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Speaker 3: down and again I'm sorry guessing. Finally, and so again
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Speaker 3: I'm kind of guessing on the exact statute of Mississippi.
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Speaker 3: Understand it's subject to state by state law, but but
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Speaker 3: I kind of give you an idea of how it works.
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Speaker 3: I have a funny feeling that I'm that a grandchild
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Speaker 3: would be way before a niece or nephew. Yes, in
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Speaker 3: almost any state, and.
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Speaker 2: She may have just assumed that they'd be good.
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Speaker 3: Yeah. Oh, so now we understand why the litigation was
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Speaker 3: going on, because in this case, if it does go
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Speaker 3: back and they in fact missed their deadline to file
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Speaker 3: and determine airship, well then the nieces and nephews are
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Speaker 3: going to luck out here and they're going to take
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Speaker 3: over the grandkids. So that's an issue. But planning, as
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Speaker 3: you said, Susan, is the way to go. And remember
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Speaker 3: when you're planning, if you have kids and spouses, you
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Speaker 3: should always have it set up where you define You know,
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Speaker 3: if you have kids from second marriages, that you define
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Speaker 3: them right. If they're illegitimate kids or step kids, you
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Speaker 3: need to define them as issue. Simply say that these
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Speaker 3: people who might be step kids might be illegitimate. I
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Speaker 3: want them specifically included as children issue descendants. All you
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Speaker 3: have to do is define them in your document and
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Speaker 3: then they'll be included. So again it comes down to
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Speaker 3: drafting and planning, and then you don't have a problem
10:02
Speaker 3: like this. Planning. Now, I'm hoping you're all going to
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Speaker 2: You've been listening to Todd Lutski, a partner with the
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Speaker 2: law firm of Cushing and Dolan. I'm Susan Powers, a
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Speaker 2: financial advisor with the Armstrong Advisory Group. We've got much
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Speaker 2: with Todd Lutsky.
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Speaker 2: Welcome back into the Legal Exchange with Todd Latsky. I'm
13:54
Speaker 2: Susan Powers, a financial advisor with the Armstrong Advisory Group,
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Speaker 2: and I'm joined by Todd Lotski, a part with the
14:00
Speaker 2: law firm of Cushing and Dolan with a master's in taxation.
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Speaker 2: Where we headed now, Todd, how about Ohio? Okay, a
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Speaker 2: huge stopping grounds.
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Speaker 3: Head over to Ohio and we're going to take a
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Speaker 3: look at how you handle business assets. Not an easy
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Speaker 3: thing to do so. In July of twenty seventeen, Ned
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Speaker 3: transferred ownership of several businesses to his daughter Heather and
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Speaker 3: her husband Tom. They executed a promisory note. It wasn't
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Speaker 3: a gift for seven million dollars two percent interest, monthly
14:35
Speaker 3: payments twenty nine thousand dollars over twenty five years. Okay, well,
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Speaker 3: unfortunately a year later Ned married Verda. That never works out,
14:47
Speaker 3: well sod. Ned married Verda a year later and a
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Speaker 3: new will was drawn up that left almost everything to Verda.
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Speaker 3: Not surprised, I mean, you're married, but again, probably a
14:59
Speaker 3: trust planning might be better. But let's keep going. We
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Speaker 3: can't add to the fact state Ned's will identified specifically
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Speaker 3: identified the promissory note as a primary asset of the estate.
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Speaker 2: Okay, okay, well.
15:16
Speaker 3: January twenty twenty two, Ned died. Verda files the will,
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Speaker 3: and of course Tom challenges its validity. The estate files
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Speaker 3: a complaint that Tom and Heather stopped making payments on
15:31
Speaker 3: the promissory note. Shocker. Heather and Tom said, well, it
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Speaker 3: was always intended for the promissory note to stop at
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Speaker 3: his death. By the way, you can draft him that way,
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Speaker 3: it's not illegal. And they sued for unjustin Richmond to
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Speaker 3: verta Then there was a lot of jurisdictional arguments and
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Speaker 3: the case got remanded to correct jurisdiction, to figure out
15:55
Speaker 3: this whole thing out.
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Speaker 2: So we don't have an answer, Ah, Lutsky, have you
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Speaker 2: learned nothing? Well, I feel like you can't do two
16:05
Speaker 2: stories at once.
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Speaker 3: This case is just too important to leave alone. So
16:08
Speaker 3: how it ultimately plays out, I'm going to give you
16:11
Speaker 3: some lessons on how to You're going to.
16:13
Speaker 2: Learn some lessons if you give us no answer. Again.
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Speaker 3: So they didn't actually determine this, although in my head
16:19
Speaker 3: it seems like they went out of their way to
16:21
Speaker 3: determine that it was a promisory note, was part of
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Speaker 3: the estate, and if the note didn't specifically say it
16:26
Speaker 3: terminates at death, I have a funny feeling it's going
16:30
Speaker 3: to be a liability or an asset of the estate.
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Speaker 2: Because if that's your intention, it would be in the note, right,
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Speaker 2: wouldn't it be in the legal document.
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Speaker 3: They're called self canceling installment notes. They're called skins in
16:42
Speaker 3: the estate planning world, okay, and they can be drafted
16:46
Speaker 3: that way. In order to do a skin, you usually
16:49
Speaker 3: charge a higher interest rate for the benefit of it
16:53
Speaker 3: expiring at your death. I'm looking at this two percent
16:56
Speaker 3: thing and thinking that that's probably not a higher interest rate.
16:59
Speaker 3: I mean, you really got to pay a higher interest
17:01
Speaker 3: rate in order for the benefit of the skin to
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Speaker 3: forgiveness at death. So so you know, I know I'm
17:09
Speaker 3: not giving you an answer. I know I'm only speculating,
17:11
Speaker 3: but it seems to me like this is probably going
17:13
Speaker 3: to have to continue to be paid, you know, over time.
17:16
Speaker 3: I don't think it'll be due and full er any which.
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Speaker 2: It sounds like it's what should happen.
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Speaker 3: Yeah, probably probably, And folks, you know, things happen the
17:23
Speaker 3: way they're supposed to when you plan. And that's what
17:27
Speaker 3: this is all about. This month, it's a brand new
17:29
Speaker 3: guide called the Simplicity of Joint revocable Trusts. So many
17:34
Speaker 3: people just don't use them. I'm giving a seminar later
17:37
Speaker 3: on this week coming week about these trusts. It's just
17:42
Speaker 3: so underutilized that I want everybody to know about them.
17:46
Speaker 3: Why are they simple? I don't have to divide assets
17:48
Speaker 3: between two trusts. I don't have to balance things between
17:51
Speaker 3: husband and wife. I can just throw all our joint
17:53
Speaker 3: assets together right into one trust. Easy operation operates during life,
17:58
Speaker 3: easily to step up in basis on death. On everything
18:02
Speaker 3: in the trust, not half. You can cram down more
18:06
Speaker 3: than half of the assets. By splitting them you only
18:09
Speaker 3: get half cram down the full amount on the first death.
18:12
Speaker 3: And if it's done right, you can actually get a
18:14
Speaker 3: step up in basis a second step up in basis
18:18
Speaker 3: on the surviving spouse's estate. So lots of things that
18:23
Speaker 3: can be done with these joint trusts, and of course
18:26
Speaker 3: provide for your family and divorce proof and everything else.
18:29
Speaker 3: So folks, really, if you never done planning, get the
18:33
Speaker 3: guide The Simplicity of Joint Revocable Trust Brand New eight
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Speaker 3: Legal Exchange Show dot com again eight six six eight
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Speaker 3: four eight five six nine nine or Legal Exchange Show
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Speaker 3: dot Com. Well what can we learn here? While there's
18:54
Speaker 3: many ways to leave a business to family members and
18:57
Speaker 3: many things to think about, I'm gonna try to touch
18:59
Speaker 3: on a one. Sometimes one child has actually been working
19:04
Speaker 3: in the business right, put all their sweat equity into
19:08
Speaker 3: the business. And a lot of families might say, you
19:12
Speaker 3: know what, this this child has really earned it. So
19:16
Speaker 3: if they've earned it, just when you die, leave those
19:20
Speaker 3: at leave the shares of the stock in that business
19:24
Speaker 3: to that to that child. You say, well, won't that
19:28
Speaker 3: make it unequal treatment for the other kids, it might,
19:32
Speaker 3: but if this child actually earned it, worked their whole
19:35
Speaker 3: career there worked that this was made part of it,
19:38
Speaker 3: they built it, well, then they earned it, So you
19:41
Speaker 3: can't really say that that that was a gift at
19:45
Speaker 3: death to them because they should have probably got it anywhere.
19:49
Speaker 2: So if that's your primary asset, and you want to
19:52
Speaker 2: treat your kids equally, but couldn't you like leave the
19:56
Speaker 2: business to all of them, but like give that child
19:59
Speaker 2: that was in one extra share, like fifty or something
20:04
Speaker 2: like that, we're going to go.
20:05
Speaker 3: It's kind of leading me down the path of the
20:07
Speaker 3: next idea. So number two would be, well, maybe we
20:10
Speaker 3: gift non voting shares to one child over time, but
20:14
Speaker 3: keep control. Remember I'm still all about my client keeping
20:18
Speaker 3: control of the business. So we'll get to your idea.
20:21
Speaker 3: But this is on that idea, Susan, where Okay, I
20:25
Speaker 3: might start giving away some shares to that child who's
20:28
Speaker 3: in the business right now, makes the child feel like
20:32
Speaker 3: they can't control it, they can't decide to sell it,
20:35
Speaker 3: they can't run it. But if the parent who's my client,
20:38
Speaker 3: who I want to stay in charge of the business,
20:40
Speaker 3: keeps voting shares well, and it gets sold, at least
20:45
Speaker 3: the kid who has the non voting shares will get
20:47
Speaker 3: a piece of the proceeds. Maybe I gifted fifty percent
20:50
Speaker 3: of the non voting shares, fine, their partner. My voting
20:54
Speaker 3: shares might only be ten percent of the entire company,
20:57
Speaker 3: and that's fine. You could do a nine to one
20:59
Speaker 3: non voting start dividend. I keep ten percent of the
21:01
Speaker 3: voting and I slowly give away ninety percent of the
21:04
Speaker 3: non voting. Again, there's tax ramifications with that, there's carryover
21:08
Speaker 3: basis issues, but you know what it does provide a
21:12
Speaker 3: way of getting the business to the next generation. Well,
21:17
Speaker 3: you could have the voting shares, so this is more
21:19
Speaker 3: your point. When you die, you can have the voting
21:22
Speaker 3: shares actually go to the child who runs the business,
21:26
Speaker 3: and all the ninety percent of the non voting shares
21:29
Speaker 3: be treated equally to all the kids. That way, the
21:33
Speaker 3: kid who's running the business can still run the business.
21:36
Speaker 3: But if you sell the business, some of the money
21:38
Speaker 3: will go to the other kid.
21:39
Speaker 2: Take orders from your siblings if he'd been renting the show.
21:42
Speaker 3: You might even want to put assets in there to
21:44
Speaker 3: try to equalize things. To say, Okay, I'm going to
21:46
Speaker 3: let the non voting shares go to my kids equally,
21:48
Speaker 3: but I'm going to give my one child who's getting
21:50
Speaker 3: the voting shares the right to buy out the interest
21:54
Speaker 3: of the ones who don't. And now I can do
21:57
Speaker 3: it at date of death value. I don't have to
22:01
Speaker 3: buy out my non voting shares I got those, but
22:03
Speaker 3: I'll buy out theirs and then I could run the
22:08
Speaker 3: business and generate a much higher value for the business
22:10
Speaker 3: on my own sweat equity. So that's okay, so many
22:14
Speaker 3: different ways, folks. And then of course, if you got
22:17
Speaker 3: it between two owners, owner one and owner two that
22:20
Speaker 3: are maybe brothers, are not related, Yeah, what a nightmare.
22:22
Speaker 2: If you don't do any planning with that situation.
22:24
Speaker 3: Yeah, then you think about buy sell agreements, right, that
22:27
Speaker 3: can trigger when you die, if you retire, if you
22:29
Speaker 3: become disabled, you got to buy out the other one.
22:32
Speaker 3: And it's easy that way, at least if you have
22:35
Speaker 3: life insurance on one one gets the money. So owner
22:38
Speaker 3: one dies, Owner two gets the money from the life
22:41
Speaker 3: insurance tax free because it's life insurance. And then the
22:44
Speaker 3: buy sell agreement says you've got to buy out owner
22:48
Speaker 3: one who died, Owner two buys out. Owner one gets
22:52
Speaker 3: the stock, the family gets the money, so the family's
22:55
Speaker 3: taken care of Owner two can continue to run the
22:57
Speaker 3: business and there's no capital gain because there was a
23:00
Speaker 3: step up and basis on the stock when the owner
23:03
Speaker 3: one died. Right, So these buysell agreements should certainly be
23:06
Speaker 3: explored for all of you who are doing this without
23:09
Speaker 3: family members. Just two independent partners look into the buy
23:14
Speaker 3: sell agreements. Very important to have those ducks in a
23:18
Speaker 3: row with a business. Folks, planning in general is important.
23:23
Speaker 3: This brand new guide dealing with the simplicity of joint
23:26
Speaker 3: revocable trusts can be so much more powerful and easier
23:31
Speaker 3: than splitting assets between two trusts eight six six eight
23:35
Speaker 3: four eight five six ninety nine.
23:37
Speaker 2: You've been listening to Todd Lutsky, a partner with the
23:40
Speaker 2: law firm of Cushing and Dolan. I'm Susan Powers, a
23:43
Speaker 2: financial advisor with the Armstrong Advisory Group. Tod will be
23:47
Speaker 2: answering your listener questions next when we return to the
23:50
Speaker 2: legal exchange with Todd Lutsky.
23:53
Speaker 1: The state planning isn't just about taxes, It's about peace
23:56
Speaker 1: of mind that Cushing and Dolan we believe your plan
23:59
Speaker 1: should protend your family, not complicate your life. A joint
24:02
Speaker 1: revocable trust can help you do both. It lets you
24:05
Speaker 1: avoid probate, which means no court delays, no public filings,
24:08
Speaker 1: and no stress for your loved ones. Your estate stays
24:11
Speaker 1: private and your family stays in control. Our new guide,
24:15
Speaker 1: The Simplicity of Joint Revocable Trusts also explains how a
24:18
Speaker 1: trust can protect your children's inheritance from creditors, divorce, or
24:21
Speaker 1: bad financial decisions down the road. This guide makes it
24:24
Speaker 1: easy to understand why a joint trust may be the
24:27
Speaker 1: smart move for your family's future. Call eight six six
24:30
Speaker 1: eight four eight five six ninety nine right now and
24:32
Speaker 1: ask for your free copy of the Simplicity of Joint
24:34
Speaker 1: Revocable Trusts. That's eight six six eight four eight five
24:37
Speaker 1: six ninety nine, or requested online from our website Legal
24:41
Speaker 1: exchange show dot com. The proceeding was paid for in
24:43
Speaker 1: The views expressed are solely those of Cushing and Dolan.
24:45
Speaker 1: Cushing and Dolan and or Armstrong Advisory may contact you
24:48
Speaker 1: offering legal or investment services. Cushing and Dolan in Armstrong
24:51
Speaker 1: Advisory do not endorse each other. In are not.
24:53
Speaker 4: Affiliated hi This is Chuck Zada from the Armstrong Advisory Group.
24:56
Speaker 4: Your home is about more than where you live. It's
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25:01
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25:06
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25:15
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Speaker 4: long term financial plan. Call us right now at eight
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Speaker 4: hundred three nine three for zero zero one. That's eight
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Speaker 4: the guide at Armstrong Advisory dot com.
25:41
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
25:43
Speaker 1: registered investment advisor. Nothing in the ad or any Armstrong
25:46
Speaker 1: guide a specific financial, legal or tax advice. Consult your
25:48
Speaker 1: own financial tax into state planning advisors before making any
25:51
Speaker 1: investment decisions. Armstrong make contact you to offer investment advisory services.
25:55
Speaker 5: Mark Vonner is the CEO of Veterans Development Corporation. Maith
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26:55
Speaker 1: You're listening to the legal exchange, and it's time for
26:59
Speaker 1: Ask Tom, the segment where Todd will answer your questions
27:02
Speaker 1: about anything and everything that's included in the estate planning process.
27:06
Speaker 1: Once again, here's Todd Lutsky and Susan Powers.
27:10
Speaker 2: Welcome back, Todd. We have a few questions from listeners.
27:14
Speaker 2: First question comes from Maureen and Attleborough Mass and Maureen writes,
27:18
Speaker 2: my husband and I have separate revocable trusts, and we
27:21
Speaker 2: kept meaning to revise how we're leaving our assets to
27:24
Speaker 2: include our grandchildren and give a bit more to my
27:27
Speaker 2: daughter who's been helping with our care. He recently passed away.
27:32
Speaker 2: Is there anything that I can do now to change
27:34
Speaker 2: how his assets are left? This is a mutual.
27:37
Speaker 3: Client, by the way, so he being the husband.
27:40
Speaker 2: Husband died, Maureene is the surviving spouse. They never revised anything.
27:45
Speaker 2: This is the first marriage. Okay, so this is a
27:47
Speaker 2: mutual client, so I know a little bit about their situation. Okay,
27:50
Speaker 2: this is your trust, your trust trust plural. Yeah, they
27:54
Speaker 2: were older, right, you know, so many years.
27:57
Speaker 1: Ago, right right, right?
27:58
Speaker 3: And to trust are not inappropriate there, They're certainly appropriated.
28:02
Speaker 3: It's just that I just love this idea of the
28:04
Speaker 3: joint revocable trust.
28:05
Speaker 2: Yeah, before we were able to do that.
28:08
Speaker 3: So you know, the unfortunate part is one one did pass,
28:13
Speaker 3: so so I can't. I was going to I was thinking,
28:15
Speaker 3: as you were reading this, that maybe we'll switch these
28:17
Speaker 3: people into a joint trust or modify their their trust
28:21
Speaker 3: to accommodate you know, their situation. But now what we
28:24
Speaker 3: have is we have the husband trust, which is now irrevocable,
28:30
Speaker 3: right because as soon as the husband died or the
28:33
Speaker 3: donor of the trust dies, whoever that is, the donor
28:38
Speaker 3: was the only one who could revoke that trust, okay,
28:43
Speaker 3: and so since that donor has died, that trust becomes irrevocable. However,
28:50
Speaker 3: I always tell the spouse, who as soon as I
28:52
Speaker 3: say that, you see the shock right appear in their face.
28:54
Speaker 3: I tell them, doesn't mean that it's not flexible, and
28:59
Speaker 3: the these kinds of irrevocable trust would put the surviving
29:03
Speaker 3: spouse as trusteek. So now it's irrevocable, but surviving spouse,
29:07
Speaker 3: you're in charge of the trust, and you're going to
29:09
Speaker 3: see as we go through it that you're really in
29:12
Speaker 3: control of all those assets, and not just control. You
29:16
Speaker 3: can enjoy them, you can use them. Okay, But the
29:21
Speaker 3: irrevocability creates the buckets of the marital share and the
29:25
Speaker 3: remainder share to help us shelter assets for estate tax purposes.
29:30
Speaker 3: They also will receive the step up in basis. So
29:33
Speaker 3: we're good. So we don't want to mess up the
29:36
Speaker 3: estate tax savings now that one died. In fact, we
29:40
Speaker 3: want to capitalize on it. So we're going to fund
29:43
Speaker 3: the buckets. We're going to read the trust, and I'm
29:44
Speaker 3: going to tell her that it is irrevocable. But you're
29:47
Speaker 3: in charge now. I know I said a lot and
29:49
Speaker 3: I haven't answered your question. So the question now is
29:53
Speaker 3: can she change his trust to tink with who gets
30:01
Speaker 3: it when she dies? And the way she wants to
30:06
Speaker 3: do it is to include grandchildren, Am I right? Yes? Uh,
30:11
Speaker 3: and give them a bit more than they were doing before.
30:15
Speaker 2: They want to include the grandchildren who were not specifically
30:18
Speaker 2: included before they were.
30:20
Speaker 3: They want it said equally to the kids before.
30:23
Speaker 2: Yeah, and now they want to They wanted to carve
30:25
Speaker 2: out and do like ten or twenty percent to grandkids
30:29
Speaker 2: and then to the kids. But she also wants to
30:31
Speaker 2: give a little extra to one.
30:33
Speaker 3: Of her daughters. So let's assume for the moment that
30:36
Speaker 3: it did say equally to the kids if living otherwise
30:39
Speaker 3: to their.
30:39
Speaker 2: Kids, and that's what it says currently be sure he died,
30:42
Speaker 2: So that's fine.
30:43
Speaker 3: So now the idea is, we just want to give
30:45
Speaker 3: a little more to one to one daughter, one daughter,
30:48
Speaker 3: and a little more to the grandchildren, and.
30:50
Speaker 2: To specifically carve out and say the grandkids get this.
30:54
Speaker 3: And then oh, so we're not going to make the grandkids.
30:57
Speaker 3: Wait exactly, I see, give a little bit the.
31:00
Speaker 2: Gus a little bit better than the kids.
31:01
Speaker 3: Yeah, big, so hard there. Yeah, no, I totally get it.
31:06
Speaker 3: And so well I don't yet because I don't have
31:08
Speaker 3: any but we'll get there. So yes, the answer is, yes,
31:15
Speaker 3: you can do it, uh in our trusts, uh, especially
31:18
Speaker 3: on first marriages. It's it's pretty certain that it would
31:21
Speaker 3: have something called a limited power of appointment, which is
31:24
Speaker 3: the ability to change a deceased spouse's trust even though
31:29
Speaker 3: it's irrevocable as to who gets it when they die,
31:32
Speaker 3: but limited to children of all generations, so she can
31:37
Speaker 3: tinker with percentages and amounts to grandkids, daughters kids.
31:42
Speaker 2: So she can't add her new boyfriend in.
31:44
Speaker 3: No, no, that wouldn't be allowed. One. Yeah, that would
31:47
Speaker 3: be like cousin Vinnie. Nobody can't can't do it, So yeah,
31:51
Speaker 3: great flexibility and you can still change folks. That's kind
31:55
Speaker 3: of how two trusts work. But the guide this month
31:57
Speaker 3: brand New is about how to give away the joint
32:01
Speaker 3: revocable how to use a joint revocable trust for a
32:05
Speaker 3: married couple, rather than two trusts. So if you've never
32:07
Speaker 3: done your planning and you're saying I've always been too complicated,
32:10
Speaker 3: this makes it so much easier. No dividing between assets,
32:15
Speaker 3: no balancing, put everything into one trust easy, you both
32:19
Speaker 3: serve as trustee. The real benefits is when one dies,
32:24
Speaker 3: you shelter more assets than you could if you split
32:28
Speaker 3: them between two, and you get a full step up
32:31
Speaker 3: in basis on the first death. And you can actually
32:35
Speaker 3: get a second step up in basis with some additional
32:38
Speaker 3: steps that you take on the second death if the
32:41
Speaker 3: estate plan allows for it. So folks, learn how to
32:45
Speaker 3: get learn how to do your planning eight six six
32:48
Speaker 3: eight four eight five six nine nine or Legal Exchange
32:51
Speaker 3: Show dot Com again eight six six eight four eight
32:55
Speaker 3: five six nine nine or Legal Exchange Show dot Com
32:59
Speaker 3: Brand New Guide.
33:01
Speaker 2: Our last question comes from Mara and Chelsea mass and
33:03
Speaker 2: Mora rites, Is there any way to minimize my estate taxes?
33:08
Speaker 2: I am single and I am worth around four million.
33:11
Speaker 2: I know that I'm under their federal amount, but I'm
33:13
Speaker 2: concerned about Massachusetts estate taxes? Is there anything I can
33:17
Speaker 2: do here?
33:18
Speaker 1: So?
33:18
Speaker 3: I guess we should first figure out what the tax is.
33:22
Speaker 3: You know, what are we dealing with? Right? You know?
33:24
Speaker 3: So four minus two it's two million. You know, the
33:29
Speaker 3: tax on two million is going to be every bit
33:31
Speaker 3: of two hundred thousand, two hundred. So yeah, I'm thinking
33:35
Speaker 3: right around two hundred thousand is probably the tax liability,
33:38
Speaker 3: give or take if she does nothing. If she does nothing,
33:42
Speaker 3: So we first got to say, is that important enough
33:44
Speaker 3: to do planning? Well, it's not short money change, Yeah,
33:48
Speaker 3: not short money, that's for sure. Well okay, what about
33:53
Speaker 3: uh gifting? Well, I suppose we could make gifts, but
33:58
Speaker 3: we really would need to add this as to whether
34:02
Speaker 3: or not it makes sense. I say that because from
34:05
Speaker 3: a gifting perspective, we're going to get no benefit from
34:10
Speaker 3: the federal estate tax side, right.
34:14
Speaker 2: Which is typically the bigger liability, right, right.
34:18
Speaker 3: So we have a thirteen point nine million dollar exemption currently.
34:22
Speaker 3: If I make a gift of a million dollars to
34:26
Speaker 3: bring me down to three million, I save nothing at
34:31
Speaker 3: the federal level. In other words, there's a forty percent
34:34
Speaker 3: tax hit at the federal level, but I'm under that,
34:38
Speaker 3: so I don't need to make any gifts to save
34:40
Speaker 3: the forty yep. If I make a gift now of
34:44
Speaker 3: a million dollars, but there's a lot of gain built
34:48
Speaker 3: into the assets that I'm giving away. It's not cash
34:51
Speaker 3: cash that might be a little different story. But if
34:53
Speaker 3: it's just a stock portfolio that has got five hundred
34:58
Speaker 3: thousand dollars of gain built in it, well, I guess
35:04
Speaker 3: I save a little bit on the mass side, maybe
35:06
Speaker 3: ten percent, because I've saved ten percent on a million
35:10
Speaker 3: dollars if it works exactly that way. But I've trapped
35:16
Speaker 3: almost thirty percent capital gains tax rates on the five
35:23
Speaker 3: hundred thousand, So that's one hundred and fifty thousand dollars
35:27
Speaker 3: of tax that I'm trapping. I don't know if I
35:33
Speaker 3: like that, don't I don't think. In other words, I'm
35:35
Speaker 3: I'm trapping something at twenty eight point eight percent to
35:39
Speaker 3: save ten by giving it away in mass, so I'm
35:43
Speaker 3: not overly thrilled with that idea. And again the other
35:49
Speaker 3: reason is that the ten percent that you're saving is
35:51
Speaker 3: actually taxd date of nine months after the date of death.
35:55
Speaker 3: You got to pay hard stop the capital gains tax
35:59
Speaker 3: that I'm trapping. The only benefit there is I could
36:01
Speaker 3: shelter it later with capital losses. You have to think
36:05
Speaker 3: these things through. This is not an easy an easy
36:07
Speaker 3: way answer cash she has cash would be okay, especially
36:11
Speaker 3: with the new Massachusetts of state tax laws that now
36:15
Speaker 3: eliminated that cliff rule. Remember the paying tax on everything
36:18
Speaker 3: when you're over, so that cliff rull has been eliminated.
36:21
Speaker 3: So giving away, you know, five hundred thousand in cash
36:25
Speaker 3: might be an acceptable approach. But folks just call and
36:28
Speaker 3: get the new guide and learn how to do your
36:30
Speaker 3: planning right. Simplicity of joint revocable trusts eight six six
36:36
Speaker 3: eight four eight five six nine nine or Legal Exchange
36:39
Speaker 3: Show dot com.
36:41
Speaker 2: If you have a question you would like to ask Todd,
36:43
Speaker 2: visit his website Legal Exchange Show dot com and click
36:46
Speaker 2: on the ask Tod tab. Maybe I'll be able to
36:49
Speaker 2: read your question on the air, and hopefully his answer
36:51
Speaker 2: will stop you from becoming one of his next real
36:54
Speaker 2: life stories. You've been listening to Todd Lutsky, a partner
36:57
Speaker 2: with the law firm of Cushing and Dolan. I'm Susan Powers,
37:01
Speaker 2: a financial advisor with the Armstrong Advisory Group. We'll be
37:04
Speaker 2: back with more after this quick break on the legal
37:07
Speaker 2: exchange with Todd Lutsky.
37:09
Speaker 1: The state planning isn't just about taxes, It's about peace
37:12
Speaker 1: of mind. At Cushing and Dolan, we believe your plan
37:15
Speaker 1: should protect your family, not complicate your life. A joint
37:18
Speaker 1: revocable trust can help you do both. It lets you
37:21
Speaker 1: avoid probate, which means no court delays, no public filings,
37:25
Speaker 1: and no stress for your loved ones. Your state stays
37:28
Speaker 1: private and your family stays in control. Our new guide,
37:31
Speaker 1: The Simplicity of Joint Revocable Trusts, also explains how a
37:34
Speaker 1: trust can protect your children's inheritance from creditors, divorce, or
37:37
Speaker 1: bad financial decisions down the road. This guide makes it
37:40
Speaker 1: easy to understand why a joint trust may be the
37:43
Speaker 1: smart move for your family's future. Call eight six six
37:46
Speaker 1: eight four, eight five six nine nine right now and
37:48
Speaker 1: ask for your free copy of the Simplicity of Joint
37:51
Speaker 1: Revocable Trusts. That's eight six six eight four eight five
37:54
Speaker 1: six ninety nine, or requested online from our website Legal
37:57
Speaker 1: exchange show dot com. The proceeding was paid for. The
38:00
Speaker 1: use expressed are solely those of Cushing and Dolan. Cushing
38:02
Speaker 1: and Dolan in or Armstrong Advisory may contact you offering
38:05
Speaker 1: legal or investment services. Cushing and Dolan in Armstrong Advisory
38:07
Speaker 1: do not endorse each other. In are not affiliated HI.
38:10
Speaker 4: This is Chuck Zada from the Armstrong Advisory Group. Your
38:13
Speaker 4: home is more than just a place to live. It's
38:15
Speaker 4: part of your story In retirement. Real estate can play
38:18
Speaker 4: a powerful role in how you manage your wealth and
38:20
Speaker 4: plan for the next generation. Passing property to family members
38:23
Speaker 4: isn't always easy. One child might want to keep the
38:25
Speaker 4: home while another prefers to sell it. Maintenance costs, taxes,
38:28
Speaker 4: and distance to healthcare services are all important factors that
38:31
Speaker 4: need to be considered, which is why having a clear
38:33
Speaker 4: plan can help prevent family stress while keeping your wishes
38:36
Speaker 4: front and center. Our new guide Owning real Estate and
38:39
Speaker 4: Retirement is designed to help you fit your property into
38:41
Speaker 4: a long term strategy that supports your life today and
38:44
Speaker 4: preserves what matters most for your future. Get your free
38:47
Speaker 4: copy right now by calling eight hundred three nine three
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Speaker 4: four zero zero one. That's eight hundred three nine three
38:54
Speaker 4: four zero zero one a request the guide at Armstrong
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Speaker 4: Advisory dot com.
38:57
Speaker 1: The proceeding was paid for by Armstrong Advisory Group, registered
39:00
Speaker 1: investment advisor. Nothing in the ad or in any Armstrong
39:02
Speaker 1: guide is specific financial, legal, or tax advice. Consult your
39:04
Speaker 1: own financial tax into state planning advisors before making any
39:07
Speaker 1: investment decisions. Armstrong may contact you to offer investment advisory services.
39:10
Speaker 1: The US Virgin Islands isn't just a postcard. It's alive
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40:11
Speaker 6: This is Michael Valila, adjudent of the Disabled American Veterans
40:14
Speaker 6: Department of Massachusetts. We focus on the people returning from service,
40:18
Speaker 6: not their specific illness or injury. Our number one goal
40:21
Speaker 6: is to make sure our veterans have the necessary services
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40:41
Speaker 1: Your tune to the legal Exchange with Todd Lutsky. If
40:44
Speaker 1: you were a loved one needs a nursing homestay, call
40:47
Speaker 1: Todd right now at eight six six eight four eight
40:49
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40:51
Speaker 1: assets are protected. That's eight six six eight for eight
40:54
Speaker 1: five six nine nine or visit him online at Legal
40:57
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41:00
Speaker 2: Welcome back into the Legal Exchange with Todd Lutsky. I'm
41:03
Speaker 2: Susan Powers, a financial advisor with the Armstrong Advisory Group,
41:07
Speaker 2: and I'm joined, of course by Todd Lutsky, a partner
41:09
Speaker 2: with a law firm of Cushing and Dolan with a
41:12
Speaker 2: master's in taxation. So you have this brand new, never
41:16
Speaker 2: before offered hot the Press's guide all about using joint
41:22
Speaker 2: revocable trusts. When we talk about the irrevocable trusts, kind
41:28
Speaker 2: of an older population that's considered that would consider that
41:32
Speaker 2: to protect against nursing home and so forth. When we
41:34
Speaker 2: talk about the revocable trust, do you have to be
41:38
Speaker 2: a certain age to consider using a revocable trust? Is
41:43
Speaker 2: age a factor in that at all?
41:46
Speaker 3: It's it's not a factor. Well, it's not a factor
41:51
Speaker 3: in whether you would use it, other than if I'm
41:54
Speaker 3: thinking about nursing home planning. So now, lord, you could
41:57
Speaker 3: be really young, you could be really old, and you
42:00
Speaker 3: can still use a joint revocable trust. The only reason
42:06
Speaker 3: age would come into play again. Any age, Yes, for
42:09
Speaker 3: the joint revocable trust, as long as you're not thinking
42:13
Speaker 3: about nursing home planning as an option. Okay, if you are,
42:17
Speaker 3: then certainly the older you are, you would not use
42:22
Speaker 3: the joint revocable trust, not because it's a joint trust,
42:26
Speaker 3: but because it's revocable, right, you would want to irrevocable. Yeah,
42:30
Speaker 3: So I think that real answer to your question is
42:32
Speaker 3: age doesn't.
42:33
Speaker 2: Matter, okay at all? All Right, So if I have
42:37
Speaker 2: let's say, you know, feely just start now or marry
42:41
Speaker 2: couple just starting out at what point from a I
42:45
Speaker 2: guess from an asset or a net worth perspective, would
42:48
Speaker 2: it make sense for them to start to do trust planning?
42:53
Speaker 3: So I think the net worth let's go with the
42:57
Speaker 3: top side, right, you know. I think when you get
42:59
Speaker 3: close to you know, the federal exemptions or dollar amounts
43:04
Speaker 3: you know, which is going to be fifteen million. So
43:06
Speaker 3: that's a pretty high number, you know, fifteen million or less,
43:10
Speaker 3: you easily can do joint revocable trusts. Does it mean
43:16
Speaker 3: you can't do it if you're worth thirty million, No,
43:18
Speaker 3: you could still do it. I think that the difference
43:22
Speaker 3: is when you get to a point where you might
43:24
Speaker 3: be exceeding the federal exemption as a married couple, you
43:27
Speaker 3: want to think about the division because you get fractional
43:30
Speaker 3: shared discounts by owning, you know, half a property in
43:33
Speaker 3: one trust and half a property in another trust. You
43:36
Speaker 3: can actually say I died and my property is worth
43:38
Speaker 3: a million, but since I only own fifty percent of it,
43:41
Speaker 3: nobody wants to buy half a property, so it's only
43:44
Speaker 3: worth and you take a discount when value it, so
43:47
Speaker 3: you can get some benefit to discounting. But again for
43:50
Speaker 3: smaller estates, let's go.
43:52
Speaker 2: Way down the estate problem at all. So let's say
43:54
Speaker 2: you've got that younger couple they're working starting out, I mean,
44:00
Speaker 2: when what's the trigger event that they should be thinking
44:03
Speaker 2: about doing trust playing.
44:04
Speaker 3: In fact, I just met a couple the other day
44:06
Speaker 3: and and they were like forty but they had you
44:10
Speaker 3: know three No, they actually had four kids. They're one
44:14
Speaker 3: of these people who tried for the boy ended up
44:15
Speaker 3: getting twin girls. So that was interesting. They said they
44:18
Speaker 3: way undersold the odds. Yeah and so so yeah, so
44:24
Speaker 3: they're doing they're doing planning, and for them it's it's
44:28
Speaker 3: a you know, they're nowhere near these federal exemption amounts,
44:32
Speaker 3: and so instead we're doing a joint revocable trust for them,
44:37
Speaker 3: again simplicity for them, they fund it very easily. It's
44:40
Speaker 3: they're the trustees. I don't have to worry about which
44:42
Speaker 3: account is growing higher or faster than another account. And
44:47
Speaker 3: we did it not just because it's simple and because
44:50
Speaker 3: it's a joint revocable trust, but for them. We did
44:52
Speaker 3: it because at minor kids. Okay, right again, is it
44:57
Speaker 3: going to help right now for estate taxes? Not overly,
45:01
Speaker 3: and they're not you know, won't matter for federal they're
45:03
Speaker 3: not anywhere near that. It could help for mass a
45:06
Speaker 3: little bit, but it's more about, hey, if we both die,
45:10
Speaker 3: these kids can't own it. It can't own anything, Okay,
45:14
Speaker 3: So I don't want some guardian owning my stuff. I'm
45:18
Speaker 3: gonna instead, you know, have a trust own it, and
45:23
Speaker 3: that way the trust can take care of it, folks,
45:28
Speaker 3: joint simplicity of joint revocable trust. It is a brand
45:32
Speaker 3: new guide. I'm doing seminars on it right now, and
45:35
Speaker 3: it's so many people just they don't seem to understand
45:39
Speaker 3: the benefits of it, and they seem to be underutilized.
45:42
Speaker 3: So I thought I'd do a whole guide on it
45:44
Speaker 3: for you. Simple, easy to fund ability, to shelter more
45:49
Speaker 3: assets on the first death. Operationally, it's easy. You get
45:53
Speaker 3: a full step up in basis on the first death,
45:55
Speaker 3: and maybe a double step up in basis. Learn what
45:58
Speaker 3: all that stuff means. I'm sort of just throwing words
46:01
Speaker 3: at you, right, but you've got to get the guide
46:03
Speaker 3: to understand the power of what that means. There's examples
46:07
Speaker 3: in here. I run the numbers for the estate tax
46:09
Speaker 3: savings on how it works, how portability works, everything, the
46:14
Speaker 3: simplicity of joint trust folks brand new eight sixty six
46:18
Speaker 3: eight four eight five six nine nine or Legal Exchange
46:22
Speaker 3: show dot com again eight six six eight four eight
46:26
Speaker 3: five six nine nine or Legal Exchange Show dot com.
46:30
Speaker 2: So a lot of people can be intimidated when you
46:33
Speaker 2: start to talk about a state planning. It feels like
46:36
Speaker 2: it's something that's really complicated or something that they can
46:39
Speaker 2: wait to do. So can you explain how one of
46:42
Speaker 2: these joint revocable trusts can actually make things simpler for
46:45
Speaker 2: couples and keep things easy for their family when they pass.
46:51
Speaker 3: Yeah, So I think when we if we're trying to
46:54
Speaker 3: compare maybe the revocable trust's husbandwife version two to one.
47:00
Speaker 3: I think that's kind of what you're asking me here.
47:04
Speaker 3: And and so the simplicity of it is a lot
47:07
Speaker 3: of times clients will say, you know, Todd, how do
47:11
Speaker 3: I fund the trust? We talk about it all the time.
47:14
Speaker 2: What do we put in her trust? What do we
47:16
Speaker 2: put in his trust?
47:17
Speaker 3: Funding is so important. And actually I've had clients who
47:21
Speaker 3: have come in with existing trusts and I say, you know,
47:24
Speaker 3: we need to you know, we need to update your
47:26
Speaker 3: documents in there so we're okay with starting over. They
47:29
Speaker 3: go and they look at me and they say, but
47:31
Speaker 3: am I going to have to retitle everything again? Because
47:35
Speaker 3: I really didn't like doing right right and they know
47:38
Speaker 3: about it right that I don't want to retitle. And again,
47:40
Speaker 3: for a lot of these people that if we're if
47:41
Speaker 3: we're doing that, just so you know, so you're not
47:43
Speaker 3: upset if you hear this, you know, if we're going
47:45
Speaker 3: to Oftentimes I'll tell them, if we're going to stay
47:48
Speaker 3: with the two trust approach, let's say that's what they have, Yeah,
47:51
Speaker 3: I would say, you know, we will amend and restate
47:56
Speaker 3: in its entirety, keeping only the name. Every other word
48:01
Speaker 3: in the document goes.
48:02
Speaker 2: Away, so it's the name and then the tax id
48:06
Speaker 2: number of their socials.
48:07
Speaker 3: The social doesn't change and changes. So then I tell them, No,
48:10
Speaker 3: you don't have to refund the trust at all, because
48:13
Speaker 3: we're not going to terminate the trust. We're just going
48:16
Speaker 3: to keep the name. Okay, brand new guts, sixty pages
48:20
Speaker 3: of new god new guts. If they come in with
48:23
Speaker 3: a joint trust that somehow needs to be updated, we
48:26
Speaker 3: could keep the name, same thing, so you don't have
48:28
Speaker 3: to refund. But you're asking me about simplicity, and that's
48:31
Speaker 3: exactly what we're talking about. Oh geez, Todd, I funded
48:34
Speaker 3: the trust with these ab I got a husband trust,
48:37
Speaker 3: a wife trust, and I'm worried now because this trust
48:39
Speaker 3: has got assets that are growing really fast, and the
48:42
Speaker 3: assets and this trust aren't growing as fast. Do I
48:44
Speaker 3: have to rebalance? No, I don't have to do any
48:48
Speaker 3: of that. With a joint trust. Put everything in jointly
48:53
Speaker 3: trans You don't have to divide the house. Remember the house.
48:56
Speaker 3: You would have to prepare a deed half into one trust.
48:58
Speaker 3: I have to just take one deed both contributed to
49:02
Speaker 3: the trust. Vacation home jointly contributed to the trust investment
49:08
Speaker 3: accounts boom, right in, don't care which account grows more
49:12
Speaker 3: or less. Very simple, Ye, both trustees. Now there's some
49:16
Speaker 3: some similarities, right, So for how we provide for the
49:21
Speaker 3: children the divorce, proof to credit or protection, that happens
49:24
Speaker 3: the same in both trusts. The state taxes is also similar.
49:29
Speaker 3: But there's a little difference here because I think with
49:31
Speaker 3: a joint trust you actually have the ability to shelter
49:35
Speaker 3: more assets than you would if you had two trusts.
49:40
Speaker 3: Let's say, for example, you had a five million dollar
49:43
Speaker 3: estate and three million was non IRA assets and two
49:50
Speaker 3: million was IRA assets. Well, if I have to take
49:53
Speaker 3: a three because I can't remember, I can't do anything
49:55
Speaker 3: with the IRA assets now, so I take the three
49:58
Speaker 3: million dollars and divide it between a husband and wife trust.
50:01
Speaker 3: On the first death, I can only shelter how much
50:04
Speaker 3: one point five million?
50:06
Speaker 1: Right?
50:06
Speaker 3: Oh, but the Massachusetts a state tax exemption is two million. Yeah,
50:10
Speaker 3: you wasted five hundred thousand dollars. Why because I got
50:13
Speaker 3: a large IRA. Right with a joint trust, you don't
50:16
Speaker 3: have that problem with a joint trust. Boom, you shelter
50:20
Speaker 3: the whole you know, your whole two million, because you've
50:21
Speaker 3: got three million in one trust, all included on the
50:24
Speaker 3: first death. Folks learn how and what the benefits are
50:29
Speaker 3: of this Simplicity of joint Revocable Trusts. Brand new guide
50:34
Speaker 3: never before issued eight six six eight four eight five
50:38
Speaker 3: six ninety nine or Legal Exchange show dot com and
50:42
Speaker 3: download it right there.
50:44
Speaker 2: Todd Lutsky from the law firm of Cushing and Dolan,
50:47
Speaker 2: thank you so much.
50:48
Speaker 3: Thank you, Susan, always a pleasure.
50:49
Speaker 2: I'm Susan Power as a financial advisor with the Armstrong
50:52
Speaker 2: Advisory Group. We thank you for joining us today and
50:55
Speaker 2: we'll be back again next week on the Legal Exchange
50:58
Speaker 2: with Todd Lutsky.
51:00
Speaker 1: The state planning isn't just about taxes, It's about peace
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Speaker 1: of mind. At Cushing and Dolan, we believe your plan
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Speaker 1: should protect your family, not complicate your life. A joint
51:09
Speaker 1: revocable trust can help you do both. It lets you
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Speaker 1: avoid probate, which means no court delays, no public filings,
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Speaker 1: private and your family stays in control. Our new guide,
51:21
Speaker 1: The Simplicity of Joint Revocable Trusts, also explains how a
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Speaker 1: Revocable Trusts. That's eight sixty six eight four eight five
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Speaker 1: six ninety nine, or requested online from our website legal
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Speaker 1: exchange show dot com. The proceeding was paid for in
51:50
Speaker 1: The views expressed are solely those of Cushing and Dolan.
51:52
Speaker 1: Cushing and Dolan and or Armstrong Advisory may contact you
51:54
Speaker 1: offering legal investment services. Cushing and Dolan in Armstrong Advisory
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Speaker 1: do not endorse each other in or not affiliated HI.
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Speaker 1: The proceeding was paid for by Armstrong Advisory Group, a
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Speaker 1: registered investment advisor. Nothing in the ad or any Armstrong
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Speaker 1: guide a specific financial, legal, or tax advice. Consult your
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