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CHARLES KLEINBROOK,
P.C.
Attorney and Counselor
at Law
29445 Beck Road, Suite
A205
Wixom, MI 48393
(248) 352-9569
FAX (248) 468-0306 Email: MrChip1234@aol.com
It is critical to review your estate
plan annually because laws and your situation often change. Most
recently in ’08, probate judges have been known to ignore certain
trust provisions when a beneficiary challenges the estate. I suggest
an immediate meeting if there is any dysfunction in the family!!
If your current advisor did not ask you these questions, let’s meet
to be sure your plan is not defective. If you remain with your current
advisor, BE SURE you go through this checklist together and have the
advisor INITIAL each item for your file. That way, your beneficiaries
cannot say you failed to be thorough. Questions suggesting a review
of your plan include:
1. Does every adult in your family have
a will, power of attorney and patient advocate agreement for health
care? Is a copy of the patient advocate agreement on file
with your doctor? DO YOU AND YOUR ADVISOR HAVE CURRENT COPIES OF PRIMARY
AND SECONDARY BENEFICIARY FORMS, [ideally tabbed at the end of your
estate planning book]?
2. Are all assets in the name
of your trust, or at a minimum, a payable on death account? Do you
have a recorded deed showing all your real estate in the name of your
trust? I suggest that you have a current informational title policy
in your file to guarantee just that. Do you know that holding assets
in joint ownership may subject survivors to unnecessary capital gains
tax, claims of creditors, and improper distribution? DO NOT deed
property into family members with “joint tenants with rights of survivorship”
unless you want them to have HUGE problems; an LLC is more often the
better choice. If you and/or your spouse rely only on a will to distribute
your property, your estate will be probated!
3. If you have a trust
and minor children, should the guardian and trustee be the same
person? Are special needs children or spend-thrift beneficiaries
properly addressed?
4. Should you change
the age or the manner in which a beneficiary receives a distribution
(installments, income only vs. lump sum) in order to protect the inheritance?
5. Do you want to
add or remove someone named in your documents (guardian, trustee,
beneficiary) due to relocation, death, remarriage, divorce, or birth?
Or, add a grandchildren’s trust in a tax free college account?
6. To avoid probate,
have you properly listed your assets and changed the beneficiary
[or in many cases an alternate beneficiary] of your insurance, annuities,
IRAs, and pension benefits to your revocable living trust? Recent
IRS changes on IRA beneficiary designations may affect your estate planning
strategy. Educational trust rules have also changed for children and
grandchildren. Should your spouse, trust or charity be the beneficiary
of your IRA?
7. Does the value of
your estate (face amount of life insurance, equity in home, IRA/qualified
plan, investments) exceed $2,000,000? If so, there may be a big tax
to your beneficiaries. Do you know how close your taxable
income is to the lower tax bracket? If not, let’s meet to lower your
tax bill!
8. Did you fund the
max this year to your IRA, Roth IRA, SEP IRA or College 529,
[at least $5,000 or more in certain plans up to 25% of income]?
If not, you missed out!
9. Have you recently
reviewed current tax strategies (gifts, education trust funding, family
partnership, charitable giving) to make sure that any estate tax (rates
to 55%) is minimized or eliminated? Have you shared with your spouse
all estate planning documents? This is critical. Have you performed
a life insurance audit every five years?
10. If you own
a business, do you have a buy-sell agreement? This protects you
and your family in the event you or your co-owner dies, is disabled
or retires. Have you created a corporation to protect your assets
and provide certain other key person benefits? Are the stock certificates
in the name of the trust? Placing certain assets in a separate entity
insulates you from liability. If you or your family have any interest
in a partnership or LLC, are the interests FORMALLY assigned to
the trust? If not, your beneficiaries and the other partners may end
up in protracted probate litigation.
11. If you are in
the 15% tax bracket, why not pay taxes on your IRA [and some of
your annuities] now at 15% and have your beneficiaries get the asset
tax free? Otherwise, your beneficiaries might pay taxes on your
IRA or annuities at a higher rate.
12. If you are in
the 15% tax bracket, have you considered selling some long term
assets with no tax!!! Otherwise, in future years you may have
to sell and pay 15% tax!
13. Will you be retiring
soon? If so, perhaps you might not want to take the joint and
survivor option, meet with me to discuss how to take the straight life
and give your spouse a larger benefit.
14. IF YOU OWN A UNIVERSAL
LIFE POLICY, WE NEED TO MEET! WILL YOU INHERIT AN IRA? DO YOU PLAN TO
REBALANCE A 401K WITH COMPANY STOCK? IF SO, STOP!!! CALL
MY OFFICE IMMEDIATELY AS YOU LOSE SIGNIFICANT TAX BENEFITS IF FORMS
ARE NOT FILLED OUT CORRECTLY.
It is important to schedule
an appointment to review your situation. It is better to see me a
day too early rather than a day too late! I can’t take your signature
off your documents, so let’s do the review soon!
There is no charge for the initial meeting.
CHARLES KLEINBROOK,
P.C. MIADVOCATE.COM
Please attach a copy of the most recent
tax return, deed/s on all real estate; A COPY OF ALL INVESTMENT, 401K,
AND LIFE INSURANCE STATEMENTS, and bring the corporate record books
of any business as well as a copy of your current will, trust and other
estate planning documents, if any. It is extremely important that
you review the legal descriptions on any quit claim deeds to the trust
and be sure to tell me about any property you sold on land contract,
even to relatives.
Charles Kleinbrook is an attorney and
is also a Registered Representative through Dominion Investor Services,
Inc. This is for informational purposes only and not a solicitation
to purchase any securities. Securities offered through Dominion Investor
Services, Inc.; Members FINRA and SIPC.
CHARLES
KLEINBROOK, P.C.
Attorney and Counselor at Law
29445 Beck Road, Suite A205
Wixom, MI 48393
(248) 352-9569 FAX (248) 468-0306
Email: MrChip1234@aol.com
"Helping
Some of Michigan's Wealthiest Families Protect and Grow
Their Estate Since 1990"
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