Morris Hall PLLC - Your Estate Matters
Your Estate Matters
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Your Estate Matters VOLUME 9 ISSUE 3  


The Most Common Mistake After Losing a Loved One
FDIC Rule Changes Increase Account Protection

Do You Qualify? Many States Tightening Medicaid Restrictions

Battle of the Exes-Estate Planning and Multiple Marriages


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The Most Common Mistake
After Losing a Loved One

Losing a spouse or loved one can be confusing and emotionally wrenching. Strong emotions can cloud one’s thinking. Actions taken at this time can cause additional confusion or problems when propelled by these emotions.

All too often, surviving spouses or children act quickly, retitling assets such as homes or IRA accounts into their names, thinking that this will enable easy access to the assets, or that it will protect the assets from the probate process or the IRS. Quite the contrary. Rather, the most important thing to do upon the unfortunate circumstance of the passing of a loved one is to contact our office. Our attorneys can discuss the best course of action to take with regard to assets, and how best to carry out the wishes of the deceased. In the meantime, do not use, touch, retitle, or change the terms of any assets until this consultation has taken place. There can be serious tax implications for these actions. Well-meaning but ill-advised actions can have unexpected negative consequences.

While it may seem logical to change the title on major assets into your name or the name of another person, there are many situations where this is not advisable. Often one may wish to disclaim assets if doing so will provide tax or other advantages. In addition, retitling assets can rob you of flexibility at a time when you need it most.

This does not mean that all financial avenues are closed. Individually owned or joint assets can still be used to pay for living expenses and other immediate needs. Take care, however, as there are many unscrupulous advisers who may appear with get-rich-quick schemes designed to prey upon the emotional fears that accompany the loss of a loved one. Often they apply tremendous pressure to retitle or transfer assets immediately.

Sometimes the best course of action is no action. Take some time to grieve, then set up a complimentary consultation with our office to review and consider the best plan for you and your family. This will allow you to make the necessary financial moves, rather than rushing into actions that can cause more harm than good.

True Story: How Not to Disclaim an Inheritance

After Mrs. Leona Engelman's death, her descendants wished to avoid estate taxes by having her estate disclaim a trust left to her by her late husband. However, qualified disclaimers can only be carried out if the person wishing to disclaim an asset has not exercised any control over the asset. While she was alive, Mrs. Engelman made several charitable donations from the assets of the trust. After her death, the IRS won a ruling holding that the donations showed she exercised control over the trust, making it part of her estate.

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