Atlanta Estate Planning Lawyer Blog

There are many tools that can be used to facilitate the transfer of assets in an estate plan. Holding property jointly (in two or more names) is one method that has advantages and disadvantages. Joint ownership of real estate, bank accounts, and other property is common because assets owned jointly with rights of survivorship do not become assets of the decedent’s estate. These assets do not pass through probate to be distributed but are transferred by operation of Georgia law and automatically pass outside of the decedent’s estate to the surviving owner(s). When joint owners are spouses, this set up can be ideal. Because there is no delay in the transfer of property under joint ownership, the surviving owner can immediately take control of the property. This is especially useful if access to the property is urgent, time-sensitive, or when financial issues need to be resolved immediately upon the death of the decedent joint owner.

Joint ownership does have its downsides and should be carefully considered before being implemented in any inter vivos circumstances or estate plan. For instance, one scenario where it can be unwise to set up property ownership jointly is when a parent and child are named as joint owners. Problems can arise if the parent has other children who are not included in the joint ownership of the property or the child involved in the joint ownership is financially unstable. With multiple siblings, even if the Georgia will specifies that the joint property should be divided evenly between all of the children, the joint ownership property is not part of the estate. Thus, the surviving owner is not obligated to split the property and distribute it per the Georgia will. This is because the joint property transfers to the surviving owner(s) by operation of law. Thus, the property never becomes part of the estate and therefore is not subject to the laws of intestacy or distribution per the terms of the Georgia will. Also, if the joint owner is a child with financial issues, the parent can lose the property if the child’s creditors endeavor to collect outstanding debts. The child’s joint ownership interest can also be threatened if the parent has financial issues, which cause the parent to declare bankruptcy. This can oftentimes be the case if the parent has significant medical expenses or other expenses associated with growing older and not having earned income.

A Georgia Estate Planning attorney can provide other alternatives to placing property in joint ownership. One good alternative is to draft an effective estate plan that specifies how the property will be divided under a number of possible scenarios. Without a crystal ball we cannot foresee which scenarios are most likely, but they can include illness, remarriage of a spouse, bankruptcy, etc. With such variability, it is prudent to draft a detailed estate plan that can factor in multiple circumstances. Such an estate plan is especially effective for larger estates or in situations where a dispute between heirs and/or beneficiaries may be inevitable. Estate planning under such scenarios often involves the use of revocable and irrevocable trusts and annual gifting. Implementing these types of estate planning vehicles can be complicated and it is necessary to have an experienced estate planning attorney assist you.

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Georgia last will and testament statues clearly outline the requirements for the creation and execution of a valid will. When these strict requirements are not met, the will is considered invalid and the testator’s estate becomes subject to the Georgia laws of intestacy, just as if no will had been created or executed. In our Atlanta probate law firm, our lawyers often represent clients with probate issues that could have been avoided if proper will drafting and will execution practice had been strictly followed. The consequences of failing to properly execute a will can be devastating for those surviving the testator. This situation can also constitute malpractice for the drafting and executing attorneys or law firm. When a will is deemed invalid because of failure to execute the will with the proper formalities, Georgia intestacy laws dictate how the estate assets are distributed. These types of cookie-cutter arrangements bypass the true intent of the deceased and may lead to conflict among the surviving heirs.

The following are some of the steps to keep in mind when executing a will in Georgia. The person executing the will, the testator, must be at least 14 years old. The will must be in writing, although the law does not specify a particular format, except that it cannot be handwritten. The will needs to be signed by the testator, who must be sufficiently competent (of sound mind and memory) at the time the will is executed, know the nature and extent of their assets, and that they are executing a will voluntarily and of their free will. In Georgia, another person can assist the testator in signing the will. This is legally sufficient when it is done in the presence of the testator and at the express direction of the testator. A minimum of two witnesses must also sign the will in the presence of the testator. The witnesses must view the signing of the will by the testator as defined by the “line of sight” rule. This means the witnesses must have an open and unobstructed line of sight to the testator’s signing of the will.

Should a witness also be beneficiary under the will, he or she must forfeit their inheritance under the will for their act as a witness to be valid, and as a result, the will to be valid. Thus, witnesses whom are beneficiaries to a will should not be a witness to the will. As a last resort, however, the testator may have three or more witnesses to their will. Under Georgia Code Section 53-4-23, a witness who is also a beneficiary may receive testamentary gift from the estate only when a minimum of two other witnesses sign the will. In this case, the other two witnesses cannot be beneficiaries. A useful and increasing necessary document to attach to the will is a self-proving affidavit. While it is not a requirement, this document proves that the will was properly executed and is genuine. It should be signed by the testator, the witnesses and certified by a notary public. Without a self-proving affidavit, one of the witnesses must be located at the time of the testator’s death and sign a legal document called “Interrogatories to Witness to Will. In this legal document, the witness attests to the validity of the will he or she witnessed. Further, the witness may be required to appear in court and give testimony under oath. With the self-proving notarized affidavit, this is not necessary and the will is likely admitted to probate without any delay.

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There is now tax relief for Georgia homeowners and an upper hand advantage for the Georgia Tax Attorneys and Georgia Real Estate Attorneys who represent and assist them. In a news brief issued by the IRS for the benefit of those with troubled loans, the government now says that if your mortgage debt is partly or entirely forgiven during 2007, 2008 or 2009 you may be able to claim special tax relief by filling out Form 982 and attaching it to your federal income tax return for that year. Usually, forgiveness of debt results in taxable income. However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude from tax up to $2 million of debt forgiven on your primary residence. The limit is $1 million for a married person filing a separate return.

Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, may qualify for this relief. The debt must have been used to buy, build, or substantially improve your principal residence and must have been secured by that residence. Debt used to refinance qualifying debt is also eligible for the exclusion, but only up to the amount of the old mortgage principal, just before the refinancing.

Debt forgiven on second homes, rental property, business property, credit cards, or car loans does not qualify for the new tax-relief provision. In some cases, however, other kinds of tax relief, based on insolvency, for example, may be available. The Adams Law Offices is conveniently located in the heart of Buckhead in Atlanta, Georgia, near the intersection of Piedmont and Roswell Roads. We would welcome the opportunity to be of assistance to you regarding any type of tax related matter concerning debt relief or other type loan restructuring or loan workout matters. Please call us at (404) 467-8611 or 1-877-412-3267, to discuss your options, or send us a message through our confidential Web Site form.

Living trusts have become popular in Georgia in the last several years as an estate planning alternative to conventional wills. They are frequently touted as a way to avoid the Georgia probate courts, which are sometimes criticized as expensive and slow to resolve estates. While I believe the probate process doesn't have to be those things, I am also happy to set up living trusts when they make sense for my clients.

Unlike a will, a living trust isn't a legal document in which you simply write down your wishes. A trust is a legal structure like a corporation or a partnership. After you create it, you can transfer your assets -- your home, bank accounts and other property -- into the trust and then specify who is to receive them after you die. This legal trick allows you to take all of your assets out of your own name while keeping them under your control. Because probate only applies to property held in your own name, you can avoid a probate case in this way.

People who set up living trusts generally name themselves as the sole trustee in charge of the trust, or name their spouses as co-trustees, although they can name any adult. Trustees have the legal right to manage and control the trust's assets, so it's important to name trustworthy people. You can also name a person or institution as a successor trustee to manage the trust if you are incapacitated.

Continue reading "ESTATE PLANNING IN GEORGIA WITH A LIVING TRUST, WILL, POWERS OF ATTORNEY OR BOTH – WHICH OPTION IS BEST FOR YOU?" »

Lifetime gifts in contemplation of death, or so-called “deathbed gifts” are usually made by a surviving parent to a child. The parent and/or the child think the gift is a good idea, probably to facilitate a transfer of legal title and/or to avoid probate. Sometimes a deathbed transfer might be made because the parent does not have a will, and thinks the lifetime gift is a good way to take the place of a will.

First, probate is not that much trouble, at least in Georgia. Also, a deathbed will is just as easy to prepare as a deed, for example. But the real problem for the beneficiary relates to the tax basis of the property.

For lifetime gifts, the grantor’s tax basis (generally the original cost of the property) becomes the tax basis of the grantee/beneficiary. For property received by a beneficiary thru the probate process (a so-called “testamentary gift”), the beneficiary’s tax basis is the fair market value of the property at the time of the decedent’s death.

For example: Assume a parent purchased a lake home years ago for $25,000. Now the lake property is worth $175,000. The parent makes a lifetime gift of the lake home to a child. The child’s tax basis is $25,000 (the original cost of the property). Upon a sale of the property for $175,000, the child’s tax gain is $150,000.

Instead assume the child received the lake home after the parent’s death thru the deceased parent’s will. The child then sells the property for $175,000. The child’s tax gain is zero, because the child’s tax basis is $175,000 (the fair market value at the time of the parent’s death). Assuming the above example, the difference between a lifetime gift and a testamentary gift could be a tax difference of as much as $60,000! So beware. A lifetime gift can result in a lot of needless tax.

Oftentimes, there are many factors involved making the best decisions about making lifetime gifts or setting up an estate plan which minimizes or diminishes any unwanted or unforeseen tax consequences. Needless to say, it is well worth the savings and peace of mind to find out before it’s too late.

Continue reading "LIFETIME GIFTS MAY NOT BE YOUR BEST OPTION FOR SAVING ON YOUR ESTATE TAXES" »

In my Atlanta estate law firm, our lawyers have a general rule in estate planning in Georgia is that every person should make a will. Unfortunately, it seems that the majority of the general public does not feel the same way and most people die without leaving a will expressing their last wishes. Many people think they don’t have anything to leave; but, more often than not, they are wrong. Some people think that you have to have children or be wealthy, suffering from a terminal disease, or elderly before it is time to make a will. There are even people who are afraid to sign a will and believe that it signifies a final act and others think that wills are written in stone and cannot be changed so they hold off making a will because they can’t decide how they would like to distribute their estate. It is a much better idea to have something in place and a will can be changed at any time. The execution of an individual’s will is a very emotional moment for some; but, if you keep in mind that it is a tool available to you to ensure that your assets are distributed in accordance with your wishes, then perhaps you can see it as a tool to ensure peace of mind.

Even if you do not have any assets, you should have a will in place in the event of your death; after all, none of us know the exact circumstances that will occur to cause our death. You might win the lottery and die from the excitement. In that event you may go from owning nothing to being very wealthy and leaving a large estate. Should you die in an accident, your estate can be greatly increased by the proceeds of a wrongful death law suit.

Your will is also a vehicle by which you can name the persons or financial institutions you wish to act as the guardians of your minor children and conservators of their estates. You can determine the terms of any trusts that may be established for their benefit.

Continue reading "ESTATE PLANNING IN ATLANTA, GEORGIA -- AM I A CANDIDATE TO MAKE A WILL?" »

In my practice as an estate attorney in Atlanta, Georgia, I am often asked about the benefits of having a will. A will is a tool used to distribute an individual’s assets after that person has deceased. As with everything in life, you need a different tool for different jobs. Therefore, if you have made a will and it has been sometime since it has been up-dated or reviewed by an estate planning attorney; perhaps it is time for you to have a lawyer review your plan.

As time passes, state and federal laws change and usually our situation in life changes along with it and we accumulate more assets than what we started with. Too many people make a will and then put it in their safety deposit box and forget about it.

A will can be changed at any time. If the change is minor, it can be done with a document called a codicil, which is an amendment to the will and is usually kept with the original will once it is signed. If the changes are significant, then a new will should be prepared and it will void any previous will dated before it.

Your will should be reviewed on a regular basis every few years to make sure that the estate plan that was utilized in making the will is still the correct plan for you. At The Adams Law Offices, LLC your estate plan will be reviewed by our experts to ensure that the distribution of your assets upon your death will go smoothly with as little expense as possible.

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As an experienced Georgia estate attorney, it is my duty to be up front about the driving force behind this article, which is your death. While nobody likes to think about their own passing, there is nothing more definite than the fact that this will occur. Some people are have heard the old saying that there are two things sure in life: “Death and Taxes” – After many years of practicing law, I have heard about many people who have altogether avoided taxes and been an integral part of assisting many clients in legally minimizing and/or diminishing significant taxes they would have paid without proper estate planning or having consulted our Firm.

Having said this, to date, I have yet to see anyone steer clear of death.

The fact of the matter is, it will happen to you, it’s just a matter of when and how. So, in knowing this, it is essential that you prepare for this inevitable moment; and, the sooner the better. Let’s discuss why.

First, there are many common misperceptions which surround estate planning. The fact is, whether your “rich”, “poor” or somewhere in the middle of these commonly referred to social terms for wealth, we all have some level of need for estate planning and the sooner you engage in estate planning, the more benefits you stand to gain. These range from potential tax benefits you are entitled to and may not be aware of to the peace of mind that your affairs are in order should you become incapacitated, disabled or your inevitable death should occur. Please also be aware that your estate planning is an ongoing process and once your estate plan is in place, it can be altered to keep up with your circumstances, should they change. The Adams Law Offices, LLC, with its client’s permission, memorializes all its client’s estate plans in an easily updateable, editable digital, electronic and physical form.

Continue reading "YOUR INEVITABLE DEATH AND YOUR ESTATE PLAN -- WHY YOU NEED AN ESTATE PLANNING LAWYER!" »