I generally begin my articles for our Family Blog Web Site with a definition of the topic or subject that I am addressing, and this month’s article will not deviate from that practice. Finance is defined by Webster’s New World Dictionary as being “the science of managing money”. And, Financial Planner is defined by Wikipedia as “a practicing professional who helps people deal with various personal financial issues through proper planning, which includes but is not limited to these major areas: cash flow management, education planning, estate planning, investment planning, risk management and insurance planning, tax planning, estate planning and business succession planning (for business owners). The work engaged in by this professional is commonly known as personal financial planning. In carrying out the planning function, he or she is guided by the financial planning process to create a financial plan – a detailed strategy tailored to a client’s specific situation, for meeting a client’s specific goals.”… View Full Article → “The Importance of Financial Planners for Clients Facing Divorce or Dissolution”
Marital Consequences of the Repeal of Federal Estate Tax
To the surprise of everyone in the estate planning community, Congress failed to address a critical estate and generation-skipping tax matter before the end of 2009, resulting in the repeal of the federal estate tax. However, this repeal is for 2010 only. In 2011, the exclusion for federal estate tax reverts back to $1,000,000. How is this possible, and what effect does it have on couples’ estate plans, particularly second marriages?
Since 2001, the federal estate tax has been gradually phasing out, with an increasing exclusion from federal estate tax each year. In 2009, the exclusion increased to $3,500,000. In 2010 however, the federal estate tax disappears, only to return in 2011 with only a $1,000,000 exclusion. To further complicate things, although the federal estate tax disappears in 2010, the unlimited step-up in basis for inherited assets also disappears; and a decedent’s estate is permitted to increase the basis of assets by only up to a total of $1.3 million with an additional $3 million if there is a surviving spouse. … View Full Article → “Marital Consequences of the Repeal of Federal Estate Tax”
The Untimely and Unexpected Death of Chris Henry…Questions About the Consequences for His Survivors
Fans of football in general, but more particularly fans of the West Virginia University Mountaineers and the Cincinnati Bengals, mourn the untimely loss of Chris Henry on December 17, 2009. He was just twenty-six (26) years of age. Henry had a stellar career as a wide receiver at West Virginia University and was drafted by the Cincinnati Bengals in the third (3rd) round of the 2005 draft. He had some notable off-the-field problems and at least five (5) legal-related incidents but was seemingly back on track with both his football career and life when he sustained an injury to his forearm in mid-season of 2009. During the Cincinnati-Baltimore game, Chris sustained a fracture to his left forearm and was thereafter placed on the “injured reserve” list.
On the evening of Wednesday, December 16, 2009, there was an incident described as a “domestic dispute” involving Henry and his fiancé, Loleini Tonga.… View Full Article → “The Untimely and Unexpected Death of Chris Henry…Questions About the Consequences for His Survivors”
Simple Year End Tax Tips
As the end of the year approaches, the following simple tax tips can keep taxes as low as possible.
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- Charitable gifting. Charitable donations may be used as deductions against your taxable income. However, all charitable donations must be supported with written receipts unless under $250 in which case a bank record is sufficient. Also, donations of services or your time are not tax deductible.
- Gifting in general. Each individual may gift up to $13,000 per year to an unlimited number of individuals without filing a gift tax return. Any gifts over $13,000 per year reduce the lifetime gift tax exclusion of $1,000,000. Once the lifetime exclusion is exhausted, gift taxes must be paid.
- Pay property taxes early. Real estate taxes are deductible. For taxes due early next year, if you pay them this year, you can use them as a deduction.
- Sell poor performing securities. Losses can be offset against gains reducing any capital gains.
Estate Planning For The Modern Family – Use Of The QTIP Trust For Second Marriages
As we all know, the typical family from the 1950’s television shows such as “Leave it to Beaver” have become a rarity over the years. A couple celebrating their golden wedding anniversary is not so commonplace. Today, approximately fifty percent of all marriages end in divorce. In the traditional family, estates usually involve wills and the use of “joint and survivorship” ownership between husband and wife or “beneficiary designations” to ensure that upon the death of a spouse everything would pass to the surviving spouse. However, in today’s modern family, there may be a second or even third spouse and children from prior marriages. How does an individual take care of his or her current spouse yet protect his/her children from a prior marriage?
The problem with leaving everything outright to one’s spouse in such a family is that the spouse may presumably leave everything to a new spouse or to their own children upon their death, leaving the children from one’s prior marriage with nothing. … View Full Article → “Estate Planning For The Modern Family – Use Of The QTIP Trust For Second Marriages”
Why One Should Not Postpone Post-Divorce Estate Planning
Attorney Joseph E. Balmer is head of the estate planning and probate department at Holzfaster, Cecil, McKnight & Mues and is one of only 17 attorneys in the Dayton, Ohio area to be certified specialist in estate planning and probate administration.
Many individuals first think about estate planning when they get married. They realize that, at a minimum, they should have a will, general power of attorney and power of attorney for health care. They may later amend these documents due to life changes or changes in their financial position. However, one might be surprised to know that a recent survey by PNC Wealth Management disclosed that 30% of adults with financial assets of $500,000 or more did not have a will! A recent Harris Interactive survey of the general population found that 58% of all adults had no will. One might be even more surprised that if he or she had a will and became divorced, he or she may be no better off than if he or she had no will.… View Full Article → “Why One Should Not Postpone Post-Divorce Estate Planning”
New Strategies To Protecting Assets From Medicaid Through Long Term Health Care Insurance
While not directly on the topic of family law per se, Attorney Joe Balmer, head of the estate planning and probate department at Holzfaster, Cecil, McKnight & Mues, has written an important article on Medicaid planning that warrants reading.
Thanks to Ohio’s Long-term Care Partnership Program, which became effective in September of 2007, it is now possible to protect more of one’s assets from Medicaid spend down through the use of certain long-term health insurance policies. However, certain criteria must be followed and it is important to purchase any such policy from an experienced long-term health care insurance professional.
Long-term health care services include help with activities of daily living, home health care, respite care, hospice care, adult day care, nursing home care and assisted living facility care. Neither Medicare nor most traditional health care insurance plans cover most costs of long-term care. Statistics show that the current life expectancy of a 65 year old is 18 additional years and in 2005, 5 percent of all people 65 years or older resided in a nursing home. … View Full Article → “New Strategies To Protecting Assets From Medicaid Through Long Term Health Care Insurance”