Preserving the Step Up in Basis at Death of Second Spouse

    The income tax concept of “basis” figures prominently in estate planning. On the sale (or final disposition) of an asset, the seller’s basis is used to calculate whether the seller has a gain or loss for income taxes.     A capital gains tax occurs when an asset is sold or more than its […]

posted on: January 26, 2015

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Affordable Care Act & Expanded Medi-Cal

  Under the Affordable Care Act (“ACA”), low income persons under age sixty-five (65) may enroll in the expanded Medi-Cal in order to meet the federal requirement that everyone have health care insurance. At age 65, Medi-care covers doctor visits, hospital visits, and some prescription drugs.  Medi-Cal, however, remains relevant for long term residential custodial […]

posted on: January 26, 2015

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Using Irrevocable Trusts in Needs Based Benefit Planning.

           Medi-Cal and VA “needs based” benefits planning confronts both front end eligibility issues and back-end estate recovery issues.  Medi-Cal and VA benefit rules differ.  Planning for both together, when relevant, requires satisfying two different sets of rules.  Such planning often involves transfers of real and personal property by the person […]

posted on: January 26, 2015

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The Right to Make Personal Care decisions.

              Under California law every person is presumed to be competent to make his or her own personal care decisions unless otherwise determined incompetent by a court.  Nonetheless capacity decisions are made all the time by others that affect one’s rights. Seniors may be especially concerned about others taking away their decision making […]

posted on: January 26, 2015

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Good News For Trusts that Manage Real Estate.

              In the recent Frank Aragona Trust case, 142 T.C. No. 9 (2014), the US Tax Court reached a taxpayer favorable decision, one that benefits trusts that materially participate in real estate business activities.  For years, the IRS has steadfastly refused to allow trusts to deduct net operating losses related to real estate […]

posted on: January 26, 2015

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Financial Elder Abuse and Undue Influence

              On January 1, 2014, California amended its statutory definition of “Undue Influence” in section 15610.70 of the Welfare and Institutions Code.  This new definition of “Undue Influence” applies both to “financial elder abuse” that affects the victim while alive and also to undue influence that affect the victim’s “testamentary dispositions” after death. […]

posted on: January 26, 2015

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Estate Planning & Digital Assets

    In the digital, virtual, online world we live in, account passwords both protect and frustrate our access to valuable intangible assets.  As more of our valuables consist of intangible digital assets and accounts stored online, the troublesome issue of access these intangible assets is one of ever growing importance.  Let us consider what […]

posted on: January 26, 2015

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Good Faith Between Spouses

    In California married persons owe each other, “a duty of the highest good faith and fair dealing” (section 721 of California’s Family Code).  This duty of “good faith and fair dealing” is likened to a trustee’s duty to a beneficiary.  How does that lofty duty apply to the conduct of married persons?   […]

posted on: January 26, 2015

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An Important New Year’s Resolution

         We all make New Year’s resolutions.  The start of the New Year is a natural time to reflect about all that is important to us and our plans for the future.  One area worth reflection is whether your affairs are in order as we come into 2014.  Let us consider some […]

posted on: January 26, 2015

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Beneficiaries with Addictions

                Should a beneficiary with an addiction to drugs, alcohol and/or gambling receive an outright inheritance?  In most cases the answer is clearly, “no”.  Doing so would likely enable the self destructive addiction.  Instead, holding the inheritance in further trust, managed by a responsible trustee, may prove more beneficial.    For discussion purposes, let’s […]

posted on: January 26, 2015

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