Monthly Archives: August 2011

Beneficiary Designations: Do you know where your money is going?

When you die, most of your property will be passed to your heirs according to your will or other estate planning documents (assuming you have contacted us first!).  However, if you happen to have a bank account, brokerage account, retirement account, annuity, 529 account or life insurance policy, which, let’s face it, nearly everyone does, these assets will be passed according to the beneficiary designation on file with the administrator of that account.  All too often, a beneficiary designation is a piece of paper filled out when an account is set up and is then quickly forgotten by the account owner.  This article by Bill Bischoff of Smartmoney.com examines how not reviewing beneficiary designations on a regular basis can lead to unintended, disastrous (and costly) results.

The moral of the story is that you should review your beneficiary designations at least once a year or whenever a significant life event (a birth, death, marriage or divorce are the most common) occurs.  Checking your beneficiary designations usually takes a few minutes and is an easy way to ensure that your estate planning goals are met.

For more information about beneficiary designations or to schedule an appointment with one of our estate planning attorneys to review your estate plan, please contact our firm at (608) 837-7386.

Disclaimer:  Please note that reading and/or commenting on this blog post does not create an attorney-client relationship with Eustice, Laffey, Sebranek & Auby, S.C. absent an express agreement between the firm and the client.  Contacting Eustice, Laffey, Sebranek & Auby, S.C. or any of its attorneys or employees via this website or via email does not create an attorney-client relationship.

We would be pleased to communicate with you by email. However, please note that if you communicate with us-through this website, via email, or otherwise-in connection with a matter for which we do not already represent you, your communication may not be treated as privileged or confidential and may be disclosed to other persons..

Why Don’t Young Adults Estate Plan?

As a young lawyer, one of my main goals is to get out in the community and meet as many people as possible.  Given that I am 28 years old, my networking efforts typically involve people my own age.  After discovering that I am a lawyer in Sun Prairie and practice estate planning, the conversation almost always goes like this (NYP = Noncommittal Young Person):

NYP:     Estate planning…yeah, I looked at having a will and some other documents drafted a while back.  I really meant to get it done, but I never quite got there.  I really should.

Me:      Why didn’t you have them done?

NYP:     I don’t know, I was going to get it done but I got sidetracked / I didn’t really know the attorney / the form was really long / I forgot to call the attorney back / I was really busy with other things at the time / I didn’t want to think about it / I didn’t know who should take care of my kids, dog, etc. / I am not married or don’t have any kids / I was told that I didn’t need to do it and that the state would take care of me.

In my experience, most young people do not see the pressing need for executing estate planning documents.  They view estate planning as something their parents and grandparents should be worried about, not them.  They also don’t think they need to execute any documents unless they are married or have children.

These views are all false.  Everyone over the age of 18 should have a Will, Financial (Durable) Power of Attorney and Health Care Power of Attorney document in place.  End of story.  My reasoning for this is quite simply that accidents happen, even to us young people!  According to recent CDC data (the most recent available, as far as I could find, was for 2007) the single leading cause of death for individuals aged 25-45 was accidents (24%).  I will grant you that it is statistically unlikely that a young person will be affected by an accident.  However, if such an accident occurs and you have not executed these documents, then you are ceding your decision-making authority regarding your health treatment, finances, etc. to other people (judges, state-appointed social workers, etc.).  Nothing against these fine individuals, they are very good at what they do and they work very hard, but when you consider that the state procedures are already over-burdened, and are costly, stressful and time-consuming to families, all at a time when that family is already scrambling to get back on its feet, I hope it isn’t hard to see why being proactive and executing estate planning documents (and, thus, avoiding the majority of this hassle) is good advice.

Moral of the story: Accidents happen.  Even to young people.  You owe it to yourself and to your family to be proactive and get these documents in place.  If you would like to discuss your estate planning needs, please call (608) 837-7386 and one of our estate planning attorneys would be happy to assist you.

Disclaimer:  Please note that reading and/or commenting on this blog post does not create an attorney-client relationship with Eustice, Laffey, Sebranek & Auby, S.C. absent an express agreement between the firm and the client.  Contacting Eustice, Laffey, Sebranek & Auby, S.C. or any of its attorneys or employees via this website or via email does not create an attorney-client relationship.

We would be pleased to communicate with you by email. However, please note that if you communicate with us-through this website, via email, or otherwise-in connection with a matter for which we do not already represent you, your communication may not be treated as privileged or confidential and may be disclosed to other persons..

Digital Assets – A New Frontier in Estate Planning

In their first year, every law student takes a class called Property in which these eager future lawyers learn, among other things, how real property (a/k/a real estate) can be passed on to future generations.  In later estate planning classes, law students come to learn the laws pertaining to “personal property” (a/k/a nearly everything else).  Personal property is further divided into tangible and intangible personal property.

Tangible personal property (cars, household furnishings, etc.) may be passed on to specific beneficiaries through an individual’s will and incorporated property list (as described in Wis. Stat. § 853.32(2)).  Intangible personal property (stocks, bonds, bank accounts, 401(k)s, etc.) is generally passed on, depending on the specific type, via a will, payable on death designation or beneficiary designation.

Until recently, these categories and mechanisms were sufficient to describe and guide lawyers in handling and disbursing of all of the property owned by an individual.  However, as described in this Wisconsin Lawyer article, a new category of quasi-property – so-called “Digital Assets” – has emerged and doesn’t quite fit into the current estate planning structure.

The article generally defines Digital Assets as “(1) any online account; and (2) any file stored on a person’s computer or on a server.”  Common digital assets include the following:

  • Email accounts;
  • Facebook accounts;
  • Digital photos (stored on an individual’s computer or with an online service like Picasa);
  • Websites, blogs or domain names;
  • Online sellers accounts (i.e., eBay or Amazon.com);
  • Paypal.com;
  • Online trading accounts;
  • Paid online subscriptions; and
  • Important computer files stored on an individual’s computer (i.e., bank account statements, tax records, etc.).

Under this definition almost everyone, whether they realize it or not, owns digital assets.  Obviously, similar to personal property, some Digital Assets will have monetary value (i.e., Paypal accounts and online trading accounts) and others will simply have sentimental value (i.e., digital photo albums and facebook accounts).  In either case, you will want these assets to end up in the hands of your desired beneficiary.  Attorneys at Eustice, Laffey, Sebranek & Auby, S.C. have teamed up with the fine folks at Entrustet.com and are prepared to assist you with your digital estate planning needs.

For more information about Digital Assets or to schedule an appointment with one of our estate planning attorneys, please contact our firm at (608) 837-7386.

Disclaimer:  Please note that reading and/or commenting on this blog post does not create an attorney-client relationship with Eustice, Laffey, Sebranek & Auby, S.C. absent an express agreement between the firm and the client.  Contacting Eustice, Laffey, Sebranek & Auby, S.C. or any of its attorneys or employees via this website or via email does not create an attorney-client relationship.

We would be pleased to communicate with you by email. However, please note that if you communicate with us-through this website, via email, or otherwise-in connection with a matter for which we do not already represent you, your communication may not be treated as privileged or confidential and may be disclosed to other persons..

Attorney Kevin M. Henry Joins the Firm!

Eustice, Laffey, Sebranek & Auby, S.C. is pleased to announce that Attorney Kevin M. Henry, a 2011 University of Wisconsin Law School graduate, has joined the firm!  Mr. Henry is a graduate of St. John’s University in Collegeville, Minnesota where he was a linebacker for the football team and active in the student government.  After receiving his college degree in 2005, Mr. Henry taught 2nd grade on a Navajo Indian reservation for three years as a Teach for America corps member.

Attorney Henry will be concentrating his practice in the areas of creditors’ rights, real estate, business law, estate planning, civil litigation, and contracts..

State of the Estate Tax

Many clients are concerned about the possible taxation of their estate upon death.   Estate planning methods are available to clients seeking to avoid/minimize estate taxes, but the shifting legislative landscape makes planning a challenge.   Let’s review recent developments regarding the federal estate tax, and examine current estate tax law.

In 2001, Congress passed estate tax legislation that resulted in an increasing exemption amount over time.  For example, the exemption increased in increments from $675,000 in 2001 to $3.5 million in 2009.  The exemption (often referred to as the “applicable exclusion amount”) is the amount of wealth (including life insurance proceeds, retirement benefits, etc.) that an individual can pass free of federal estate tax to his/her loved ones.  The 2001 legislation provided that 2010 would be a year without a federal estate tax, absent further Congressional action.

On December 17, 2010, the President signed legislation that set the estate tax exemption at $5 million for 2010 through 2012.  (For 2010, an estate can opt out of the new law, but must then limit its ability to adjust cost basis.)  Moreover, the exemption is now transferable (“portable”) between spouses, effectively providing married couples with $10 million of federal estate tax exemption*.  If Congress fails to revisit this issue prior to the end of 2012, the estate tax exemption will drop to $1 million on January 1, 2013.

Given the volatility of federal estate tax law, you should stay apprised of any changes to the law that might cause you to re-examine your estate plan.

Disclaimer:  Please note that reading and/or commenting on this blog post does not create an attorney-client relationship with Eustice, Laffey, Sebranek & Auby, S.C. absent an express agreement between the firm and the client.  Contacting Eustice, Laffey, Sebranek & Auby, S.C. or any of its attorneys or employees via this website or via email does not create an attorney-client relationship.

We would be pleased to communicate with you by email. However, please note that if you communicate with us-through this website, via email, or otherwise-in connection with a matter for which we do not already represent you, your communication may not be treated as privileged or confidential and may be disclosed to other persons.

* For purposes of this summary, it is assumed that the spouses are U.S. citizens..