Attorneys & Counselors at Law


1. I have a will. Why would I need a trust?                                                                       
Answer: When you die, your will must be probated. Probate is a formal public procedure of the Superior Court. Most probates take about two years. During this time, your estate will be frozen. Plus, anyone can pull your probate file and find out all about you. They can read your will and see what you own, what you owe, and to whom you have left your estate, since this is all part of the public record. Probate is expensive. Probate fees are paid to the attorney who does the probate. These fees are set by state law. In California these fees are a percentage of the GROSS amount of the estate, not the net. Trusts do not go through probate. You will learn a lot more about probate and how to avoid it at one of our free workshops.

2. Now that the exemption from the Federal Estate Tax (Death Tax) has been increased, why would I need a trust?
Answer: Please see the answer to #1 above. The Probate Fees are paid to an attorney. They are NOT A TAX. They are not paid to the government. The increased exemption from the Death Tax has nothing at all to do with Probate Fees!

3. In addition to avoiding Probate Fees, is there any way to reduce or avoid the Death Tax?
Yes. There are many ways to avoid or reduce the Death Tax. All of these are generally best accomplished through a trust.  For example, one simple way you can double the Death Tax exemption is through a special kind of trust available to those who are married. Unfortunately, many people have not taken advantage of this method which will end up costing them thousands, even millions, of dollars.

4. I have everything, my home, bank accounts, etc., in Joint Tenancy with my spouse. If I die my spouse will get everything, without probate. If she died, I will get everything, without probate. So what is the big thing with probate? It looks like we avoid it with Joint Tenancy right?
Answer: Wrong! If you die, your spouse will receive everything you own in Joint Tenancy with her without probate. If she dies, then the same will be true for you. The problem is that when the last of you die, there WILL be a probate. Joint Tenancy does not avoid probate; it just puts it off and puts you to sleep.

5. Given what you have told me about Joint Tenancy, why not just put our children’s names on our home, bank accounts, etc., as Joint Tenants, along with my wife and me?
If you add your children as joint tenants on an asset, you could find yourself in a real mess. You lose control of the asset because your child is now a joint owner of the asset.  If your child gets divorced, has creditor issues, or gets sued, you will find yourself in jeopardy of losing that asset.  Many well intentioned parents unnecessarily pay a big price and learn a painful lesson.  A living trust can facilitate a smooth transfer of your estate to your children upon your death avoiding the many pitfalls of joint tenancy. 

6. If my spouse and I put our children's’ names on our accounts as POD beneficiaries they will get those assets when both of us die. What is wrong with that?
Of course, things might work out right if you do that, but they might not. If your kids are under eighteen when both of you die, the money will be held for them in a court blocked account until they achieve their 18th birthday. Your kids getting money on their 18th birthday is very likely not a good thing. In our experience, they blow it!
Plus, what if one of your kids dies before you? Would you want the asset to go to your other kids, or to the children of the child that died? This kind of account is at best a gamble. If you leave your children assets in your trust you can have a Successor Trustee of your choice hold the assets for them until they reach an age of reason. This is usually NOT 18! During the time it is held, the Trustee can use the money for the kid’s support and education. The best way to handle this kind of matter is with a trust. If not, you are leaving a mess for your kids and taking a huge chance that things will work out.

7. I have heard that every time you take something out of your trust, or buy anything, you have to go to your attorney and have your trust changed. Why would I want to do that?
Some attorneys do set up trusts that require you to go to them each time you buy or sell anything, or write trusts that require constant updating. The Law Offices of South Orange County does not do that. We give our clients a Certificate of Trust that allows them to put things into and take things out of their trust themselves. We also give extensive instructions on how to do this.

8. I have heard that if I have a trust I lose control over my assets. Why would I want to do that?
This is not true. Some very rich people choose to have a bank, brokerage house, or a like entity be the Trustee (the person or company in charge of a trust). Most people do not choose to do this. As a matter of fact, you can be the Trustee of your own trust.. You will have all the power now as the Trustee. You will find out much more about this at our free workshop.

9. I have been married before. I have two children by that marriage. When I die, if I leave everything to my spouse I am afraid that my spouse might not leave anything for my kids. On the other hand, if I leave everything to my kids, my spouse will not have enough to take care of her in her old age. Is there any way I can take care of my current spouse and take care of my kids?
Answer: Yes. There are many ways you can set up your estate plan to take care of this. There are lots of different options and types of trusts to choose from. 

10. What if I have a trust, but things change and I want to change the trust?
This is not a problem. A Revocable Living Trust can be amended, or revoked. You can change it as often as you want. However, remember that putting new assets in your trust, or taking them out, is not an amendment to your trust, at least the way we do them. Usually, the reason people amend their trusts is because they want to change who is in charge of their assets after they die or who they want to leave their assets to.

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