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The Extraordinary Life and Ordinary Will of David Bowie

David Bowie turns out to be a unique individual with an ordinary $100 million will.

While there was speculation that musician David Bowie's estate plan would have been unusual with strange requests, it turns out the $100 million will is rather ordinary and does not include a breakdown of assets.

He directed that his wife should receive half of the estate, including his New York apartment. A total of 25 percent of the estate was left to his minor daughter through a trust. The remaining 25 percent is to go to his son from a previous marriage. Bowie also included small bequests to a couple of friends.

The New York Times reported on the will in "David Bowie's Will Splits Estate Said to Be Worth $100 Million."

The only unusual aspect of Bowie's will is how he would like his remains treated. In the 1980s, he vacationed with Iggy Pop in Bali. He fell in love with it and asked that, if possible, his remains be transported there to be cremated and disposed of according to Bali's Buddhist rites. If it is not possible to have his body cremated there, he at least wanted his ashes spread there.

It appears that the will of this unique individual is not only ordinary but unlikely to be challenged.

Reference: New York Times (Jan. 29, 2016) "David Bowie's Will Splits Estate Said to Be Worth $100 Million."

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There are Options to Traditional Funeral

Some people are turning to the older option of funeral services at home rather than the funeral home.

Before the Civil War most people were buried at home after services held by their families but public mourning with morticians preparing the remains has become the tradition.

The New York Times reports that many Americans are now looking to go the older route and have funeral services conducted in their own homes by family members in "Start-Ups Take Rites From the Funeral Home to the Family Home." One of the big benefits for many people is that home funerals are much less expensive than using a funeral home. Other people prefer the intimacy of services conducted in the home.

It is a good idea to think about how you would like your funeral to be conducted at the same time you are creating an estate plan.

Whether you would prefer a home funeral or a funeral home, you can make your preferences known in your will or in another document. As long as your preferences are reasonable and legal, then they can be followed.

Reference: New York Times (Jan. 30, 2016) "Start-Ups Take Rites From the Funeral Home to the Family Home."

For more information on how to create your own estate plan, please visit our website.

Nursing Home Arbitration Clauses Can Be Difficult

Mandatory arbitration clauses are being worked more and more into nursing home contracts and those clauses aren't aimed at helping the patient.

According to the fine print, any dispute between the consumer and the company are handled under contract by arbitration if the company has its say. Nursing homes and other elder care facilities are increasingly inserting similar arbitration clauses into their contracts.

Companies are quick to note that arbitration is normally faster and cheaper than going to court. However, consumer advocates and elder law attorneys point out that these clauses do not necessarily benefit consumers. In reality, arbitration can make it more difficult for consumers to prevail and remedies that might be available in court are sometimes not available in arbitration.

The Wills, Trusts & Estates Prof Blog reports that a court in Arizona recently refused to enforce the arbitration clause in one nursing home's contract in "Arizona Court Overturns Home Arbitration Agreement."

In this case, the man who signed the contract on behalf of his mother did not have any legal authority to bind her to arbitration. He was not her power of attorney.

Going further, the court also signaled that such a ruling could apply more broadly. According to the court, the arbitration clause could be seen as an unenforceable contract of adhesion.

As the article notes, in many states consumers have a legal right to strike out the arbitration clauses before signing the contracts.

Before you sign any contract about nursing home care it would be beneficial to consult with an elder law attorney.

Reference: Wills, Trusts & Estates Prof Blog (Feb. 2, 2016) "Arizona Court Overturns Home Arbitration Agreement."

Please visit our website for more information on estate planning.

Children Can Be Blocked from Your Estate

It can be a tough decision but you can prevent your children from receiving any part of your estate.

As a teenager a man had a relationship that resulted in a daughter but he did not find out until the daughter wrote to him with the news that her mother had identified him as the father while the mother was on her death bed.

This story appeared in an article entitled "Can my 40-year-old long-lost daughter get my estate?", recently featured in Market Watch with a question from a reader.

The man paid for DNA testing which confirmed that she was his only child.

Unfortunately, the father and daughter ultimately did not get along and ceased communication. The man lives with a partner who wishes to give him her house when she passes. However, this partner is reluctant to do so. It seems she does not want the daughter to inherit the house when the father passes away.

The man wonders how he can ensure that the daughter will not inherit the house.

The answer to the reader's question is very short and simple. He can have a will or living trust prepared to specifically exclude the daughter and any of her children.

Nevertheless, the article does not elaborate regarding why this needs to be done.

Accordingly, a more complete explanation would have noted what happens when a single person passes away without a will. In such circumstances, the laws of intestate succession apply. Consequently, the estate passes to any living children.

So, if you do not want a child to inherit your estate, you need a will or a living trust. However, that is not all that must be done.

The law assumes that if a child is not mentioned in a will, it was an oversight. The judge can reconstruct the will to include the child. For that reason the child must be mentioned in the will and specifically disinherited.

A meeting with an estate planning attorney can help you accomplish your goals.

Reference: Market Watch (Feb. 5, 2016) "Can my 40-year-old long-lost daughter get my estate?"

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It is Possible to Go out of State for an Executor

Your first choice of an executor may not reside in your state of residence but they can be appointed to the position. However, it is important to know the potential problems.

Your first choice as the executor of your estate may not live close by or even within your state of residence – but, if you are comfortable with them, they are someone you trust and someone with strong financial knowledge and experience it is still possible to designate that person as your executor. It is important, however, to realize there can be problems.

This subject was considered in a recent NWI Times article entitled "Pros and cons of an out-of-state executor."

The two biggest drawbacks are availability and time.

Executors are often required to make personal appearances at court hearings. It can be burdensome and expensive for an out-of-state executor to make the travel arrangements. Logistically, paper correspondence may also take longer.

According to the article, some states have additional requirements when the executor is a non-resident. For example, the state of Indiana requires out-of-state executors to post a bond and appoint someone who is a state resident as a registered agent for service of process. Other states have similar requirements.

On the plus side, appointing an out-of-state executor allows you to designate the best person for the job. Many of the negatives of doing so can be mitigated if the executor hires a local estate attorney to assist with the administration.

Consider contacting an estate planning attorney to guide you in the selection of filling the important position of executor.

Reference: NWI Times (Feb. 7, 2016) "Pros and cons of an out-of-state executor."

Please visit our website for more information on estate planning.

Use the Tax Season to Look at Your Estate Plans

Your estate plan should be reviewed occasionally and linking it to the annual tax season could be beneficial.

The tax season is a time for gathering all of your key financial information and is an excellent time to take a look at your estate plan. While doing your taxes you will be gathering much of the same documentation needed to review an estate plan. In addition, the documentation will be fresh in your mind.

Accounting Web recently offered some tips about estate planning during the tax season in "Estate Planning Reminders for This Tax Season."

The advice includes:

• Review or Get a Will – Spend a little time to review your will and make sure everything is up to date. If you do not already have a will, visit with an estate planning attorney about getting one.
• Prepare a Letter of Instruction – Make a list of your assets, where they are located, and how they should be handled in your estate.
• Review Beneficiaries – Since you should have the asset documentation available as part of your tax preparation, make sure all beneficiary designations are up to date.
• Consider a Trust – Again since you already have the documentation handy, tax time is a good time to have a trust drawn up and to transfer assets into the trust.

The person who prepares your taxes and your estate planning attorney could work together. Consider it as tax time comes around.

Reference: Accounting Web (Feb. 8, 2016) "Estate Planning Reminders for This Tax Season."

For more information on how to plan your estate or better: attend a free seminar, please visit our website. 

States Evaluate Importance of Estate Taxes

Since wealthy elderly residents have been known to relocate to states with more favorable estate tax laws, a clear trend has developed with more and more states reducing or eliminating estate taxes.

A dilemma has been presented to state governments facing revenue declines. They can raise tax revenue by taxing the estates of the wealthy but they then risk their own residents relocating to more lenient states before they pass away.

When such citizens move away that means these state governments with estate taxes do not receive income or capital gains taxes from those wealthy people. In the end, such states must determine which taxes are more important to them and their budgets.

Kiplinger's Personal Finance reports in "More States Giving Heirs a Break on Estate Taxes" that the majority of states have chosen to keep their citizens rather than impose an estate tax.

So, how many states still have an estate tax? At present, this number includes only 14 states and the District of Columbia. Tennessee is the latest state to do away with its estate tax and six other states have increased their estate tax exemptions recently.

Although it might be tempting to say this trend is clear evidence that estate tax revenue is not as important as other revenue, there probably is not enough definitive evidence to make that claim. The political controversy surrounding the estate tax might play some role in this trend amongst the states.

It will be worth watching if the states still imposing the tax continue to face pressure to repeal it to keep the wealthy from fleeing to other states in their retirement years.

An estate planning attorney could be helpful in guiding you through these important issues.

Reference: Kiplinger's Personal Finance (February 2016) "More States Giving Heirs a Break on Estate Taxes"

Please visit our website for more information on estate tax or to register for a free living trust seminar.

Number of Elderly Facing Poverty May Increase

Current trends may force an increase in the number of elderly people living in poverty in the U.S., reversing recent success stories.

Healthcare prolonged the average lifespan in the first decades of the 20th Century but there was also a considerable increase in elderly people living in poverty. Policies put into effect in the developing world reversed the trend. In the United States private pension plans, Social Security and convincing people to save for retirement have combined to make elderly poverty relatively rare.

That could change in the near future as the New York Times reports in "An Aging Society Changes the Story on Poverty for Retirees."

There are pressures on all three tools that helped lower elderly poverty.

Fewer and fewer people have private pension plans through their employers. People are not saving as much as they will need for retirement. Perhaps most importantly, an aging population creates stress on Social Security, which relies on current taxes on younger workers to make payments to the elderly. Fewer young workers per every hundred elderly people means there is less money in the system to meet obligations.

It would be a good idea to understand what these changes might mean for your own retirement and estate plans. If you want to leave money to your heirs, you need enough not only for your own retirement years, but also enough to leave in an estate.

An estate planning attorney could give you some insight into this issue.

Reference: New York Times (Dec. 22, 2015) in "An Aging Society Changes the Story on Poverty for Retirees."

Please visit our website for more information on estate planning.

Some Pets Left Behind Are Very Wealthy

Some people may have made their beloved pets extremely wealthy when it came to taking care of them in their estates by leaving them millions.

It has become common in recent years for pets to be included in an estate plan as people focus on distributing their wealth to care for pets as well as human relatives. While generally only sufficient money has been left to care for pets in a modest lifestyle, some have inherited large amounts of money.

Recently, Time published a list of some of these wealthy pets in "The 10 Richest Pets of All Time."

The list includes:

• Gunther III - A German countess left her dog her entire $80 million estate. The trustees of the estate have grown the fortune to $375 million that now belongs to Gunther's child, Gunther IV.
• Toby Rimes - This poodle inherited $40 million when its owner passed away in 1931. However, Toby died a few months later and the estate was divided between various charities.
• Tommaso - This Italian cat was a stray adopted by an elderly woman who left it her $13 million estate.
• Gigoo - A British publisher left his beloved chicken Gigoo a fortune worth approximately $15 million.
• Trouble - Leona Helmsley left her dog Trouble $11 million – although the inheritance was later reduced to a mere $2 million by a judge.

Of course, you do not need to leave a pet anywhere near the above amounts to make sure they are taken care of after you pass away.

An estate planning attorney can guide you in caring for your pets as well as your relatives.

Reference: Time (Oct. 5, 2015) "The 10 Richest Pets of All Time."

Please visit our website for more information on estate planning and pet trusts.                     

Trump's Actions Involving Father's Estate Spark Media Attention

Family disagreements can sometimes rise into public view as seen in Donald Trump’s campaign for president.

Given presidential candidate Donald Trump’s temperament for blunt, off-the-cuff comments, it should come as no surprise that a challenge to his father's will caused Trump to act out of anger and he is now answering questions about it.

Trump's older brother was not interested in the family real estate business. He instead became a pilot until alcoholism forced him out of the sky. He died from the disease in 1991.

When Trump's father passed away in 1999, Fred Trump III, Donald's nephew from his brother, spoke at the funeral. That night Fred III's child was born with cerebral palsy. Donald Trump pledged that the Trump family would take care of the child's medical needs.

However, when his father's will was read it was discovered that his brother's family was cut out of the will.

Donald Trump had helped create the will.

His nephew's family claimed Donald and his other siblings had unduly influenced their father who suffered from dementia. They challenged the will. This angered Trump and he cut off support for the child with cerebral palsy.

The Daily Mail has more on this story in "Donald Trump admits cutting off medical treatment for his nephew's sick baby after will dispute with alcoholic brother's family."

Undoubtedly this story will be used for political reasons as long as Donald Trump remains a presidential candidate.

There is, nevertheless, a non-political lesson in all of this.

When families feud over estates, the feuds have a way of affecting others, like the medical treatment of a sick child.

Contacting an estate planning attorney could possibly help avoid such issues.

Reference: Daily Mail (Jan. 3, 2016) "Donald Trump admits cutting off medical treatment for his nephew's sick baby after will dispute with alcoholic brother's family."

Please visit our website to learn more about handling estates with special needs or to register for a free living trust seminar.