Americans Unprepared For Biggest Wealth Transfer In History, According to RBC Report

A recent report suggests that Americans are unprepared for the biggest wealth transfer in U.S. history. According to Royal Bank of Canada (RBC) Wealth Management, Americans are “woefully” unprepared to transfer trillions of dollars from the older generation to their heirs, something that will happen in the near future.  Continue reading Americans Unprepared For Biggest Wealth Transfer In History, According to RBC Report

Can I Put My Home in a Trust?

The short and simple answer is yes. Any property you own and have legal title to can be transferred into trust. That includes real property. Even real property that is subject to a mortgage can be placed into a trust. Most people, after all, don’t own their houses free and clear of a mortgage when putting their homes into trust. But transferring real property into the trust does not change your obligation to continue to pay the mortgage–if you don’t pay, they can still take back the house. In fact, if you’re thinking of putting your home into trust you should consider contacting your lender first. You might trigger a due on sale clause if one is included in your mortgage contract. The lender can call the entire mortgage due all at once because you technically no longer own the home. Further, if after placing your home into trust you decide to refinance your home the lender may require that you take your home out of trust before getting the new loan and putting it back into trust after getting the new loan.

Advantages of Putting a Home into Trust

Homestead Exemption Issues 

If your line of work leaves you vulnerable to lawsuits you may want to consider your state’s homestead exemption laws. These laws put your house – or at least a portion of its value – out of reach of judgments or, in a worst-case scenario, your bankruptcy estate. When it comes to trusts, homestead laws can vary significantly from state to state. In some states, your property is only protected if you personally hold title. If you transfer ownership of your house to an irrevocable trust, however, this shouldn’t be a consideration. This type of trust also shields assets from creditors, so you’d just be exchanging one form of protection for another.

Avoidance of Probate Issues 

Most living trusts are structured to avoid probate and its costs. While some states have streamlined their probate process, many still require cost, time and attendance at multiple hearings. Most homeowners wishing to avoid probate and transfer title to their home to their heirs quickly find avoiding probate through a trust to be a strong advantage.

Consider the Deed Used to Transfer the Home into Trust 

The deed you use to transfer your property to your trust can present another issue. Real property can be transferred by two main instruments: a warranty deed or a quitclaim deed. A warranty deed guarantees a future buyer that there are no hidden liens or claims against your property, and that you – or your trust – actually own it. Thus, you have something to sell. A quitclaim deed, on the other hand, makes no such representations. It simply transfers any ownership interest you might have without guaranteeing that you have an interest or that it’s not encumbered by liens. A future buyer would be wary of this type of deed if your trustee finds that he must sell the house after your death. Depending on the type of deed you use to make the transfer to your trust, you could create a big estate issue in the process of settling your estate at your death.

For more information about how we can help with your estate planning needs please contact our office today!

Are You Guilty of Micromanaging Your Aging Parent?

Elizabeth O’Brien, Retirement Reporter for, calls them “Tiger Children.” They are individuals with aging parents who try to micromanage their aging parents in making important decisions such as elder care and estate planning. As a lawyer with a practice focused on estate planning, “Tiger Children” remind me of an all too common estate planning issue: undue influence. Undue influence is defined as influence by which a person is induced to act otherwise than by their own free will or without adequate attention to the consequences.

According to Cornell University Law School, in order prove undue influence, a party must show that one party to a transaction or contract is a person with weaknesses which make him likely to be affected by such persuasion, and that the party exercising the persuasion is someone in a special relationship with the victim that makes the victim especially susceptible to such persuasion. For example, Albert is a 95 year old widower with dementia. His primary caretaker is his much younger girlfriend, Barbara. Everyday Barbara presses her aging boyfriend to write a will leaving his entire estate to her and to disinherit his children, Charles and Danielle. When Albert shows resistance, Barbara threatens to cease taking care of Albert. Feeling vulnerable and pressured by Barbara’s demands, Albert gives in to Barbara’s wishes and decides to write a will leaving his entire estate to Barbara and disinherits Charles and Danielle. At Albert’s death, Barbara tries to have Albert’s will probated. Charles and Danielle, however, may be able to challenge the will as invalid due to undue influence on Albert by Barbara.

Click here to check out Elizabeth O’Brien’s article, “Don’t be the ‘Tiger Child’ at your family gathering,” to learn how you can avoid the mistake of micromanaging and pressuring your aging parents.



2016 Estate Tax Rates

Here’s a great article by Matthew Frankell with The Motley Fool, called 2016 Estate Tax Rates. According to, an estate tax is a tax that is levied on an heir’s inherited portion of an estate if the value of the estate exceeds an exclusion limit set by law. Click here for the article.

In this article Frankell details the current estate tax brackets, along with the rates for each tax bracket set by federal law. (Note however, certain states impose an additional estate tax.) While the numbers may seem daunting at first, the article goes on to describe how the lifetime exemption amount (an amount you leave to your heirs that will not be taxed) allows many estates to avoid federal estate taxation at all.

For Alabama residents, this is great information to know as well because Alabama does not impose a separate state estate or inheritance tax. It collects the maximum credit allowed on the federal estate tax return.

For more information on how you can reduce and even avoid estate taxes, contact our office at (205) 578-1597.

5 Legal Documents You Should Have

All too often we find ourselves in situations where we need immediate access and use of certain legal documents. No matter who you are, it is important that you take the necessary steps to acquire these documents. After you get these documents put them in a safe place and retrieve them when needed. Below are 5 legal documents that every individual should have before the need for them comes:

I. Will

Let’s face it, no one wants to think about dying. As a result, most individuals die without a will. Writing a will, however, does not have to be a daunting experience. In fact, everyone needs a will to make sure your assets are distributed correctly. If you are a parent of a young child, you will need to appoint a guardian to take care of your kids. Dying without a will could lead to extensive bickering and fighting among your family over the distribution of your estate. Do your loved ones a favor and invest in having a will written by an estate planning attorney. Click here to learn more about having your will written by our office.

II. Power of Attorney

A power of attorney is a legal document giving another individual (referred to as your attorney in fact) the authority to act and make certain decisions on your behalf. If you ever become debilitated or otherwise incapacitated, the attorney in fact will make decisions for you. If you are out of town or out of the country, you can also authorize your attorney in fact to make decisions for you and manage your affairs in your absence. Click here to learn more about having your power of attorney written by our office.

III. Advanced Medical Directive

In addition to having a power of attorney written to handle business affairs and other miscellaneous matters, an advanced medical directive is very important to have as soon as possible. An advanced medical directive is a legal document that states your wishes in regards to your health care. An advanced medical directive addresses issues such as life support and whether to resuscitate you if you are unresponsive. Remember the Terri Schiavo case? The seven-year legal battle between in-laws could have been avoided with an advanced medical directive. Click here to learn more about advanced medical directives and living wills.

IV. Life Insurance

Again, no one wants to think about death, so most people don’t take the time to invest in life insurance. Life insurance, however, is imperative to have in order to make sure all of your debts and memorial services are taken care of. Neglecting to do so will leave your family with the responsibility of handling these costs.

V. Living Trust

A trust is an arrangement created by you under which one person, called a trustee, holds legal title to property for another person, called a beneficiary. You can be the trustee of your own living trust, keeping full control over all property held in trust. Just like a will, a living trust spells out exactly what your desires are with regard to your assets, your dependents, and your heirs. The difference between the two, however, is that a will becomes effective when you die and is probated, but a living trust does not have to go through the costly time-consuming probate process. If you have a trust, it is important to make sure that trust is properly funded and that all of your personal property is transferred to your trust. Click here to learn how our office can assist you in creating a trust.

You never know when you’ll need either of these documents, so give us a call today and let us help you plan for the unexpected.