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San Mateo California Estate Planning Law Blog

Do you believe that a trustee is stealing assets from the trust?

Those with significant assets, large families or a desire for a specific legacy often put a lot of effort into creating an estate plan. Deciding how to divide assets and allocating them to the right people is an important step toward creating a legacy that people remember someone by.

Unfortunately, it is often a complicated process. The more assets an individual has to leave behind, the more likely their family members, loved ones and heirs are to squabble over the assets. Creating a trust is often a perfect solution for those with significant assets and complicated wishes. The trust creator can designate someone to serve as trustee to carry out their wishes and administer the trust.

Pets no longer considered property in divorces in California

The New Year is bringing some good news to California pet owners going through a divorce by giving them a legal leg to stand on when disputing the pet's ownership in court. Previously, pets had been treated like property in divorce cases, similar to vehicles, and orders had been given to sell pets and divvy up the proceeds between the divorcing couple. But as pet owners very well know, pets are not like property-they are more like children and divorce is stressful for them as well.

The new law will now change the way courts treat pets. Sponsored by a dog owner and state assembly member, the measure allows judges to create shared custody agreement by considering the care of the pet in question. Now judges can take who takes the pet for walks and feeds them into account when making decisions on whom the dog should live with.

Couples rushing to divorce before the end of the year

While couples usually wait until the end of holiday season in January to file for divorce, allowing families spend the festive season together, new laws have pushed couples to hurry to file for divorce before the end of 2018. California residents might be aware that the Tax Cuts and Jobs Act change the way payments between ex-partners are taxed.

According to experts, there has been a four-fold increase in their workloads, and courts are staying open longer to accommodate the traffic of couples trying to finalize their divorce so they can take advantage of the previous tax rules. Under the old law, alimony was taxed in such a way that the higher earning spouse, usually the one paying alimony, can deduct alimony from their income while the one receiving alimony, typically the lesser earning spouse, pays tax on that sum. Under the new law, the tax burden will fall on the person writing the check.

When can a trustee's actions lead to trust litigation?

Being named a trustee is an honor, but it also comes with many duties, both in the administration of the trust as well as a fiduciary duty towards the trust and trust beneficiaries. If a trustee in California fails to properly execute their duties, it could give rise to trust litigation. Therefore, it is important for beneficiaries to understand what a trustee's role is with regards to the trust, so they can recognize when the trust is being mishandled.

Trustees have numerous duties that they must fulfill on an ongoing basis. If applicable, they must invest trust assets. These investments should be made in a way that preserves trust assets and makes the trust a productive vehicle for the trust beneficiaries. Trustees must also distribute trust assets to the beneficiaries of the trust per the terms of the trust. Depending on the trust, a trustee might need to use his or her good judgement over when to distribute payments to a trust beneficiary. Trustees are responsible for preparing any necessary tax returns. Trustees must keep the trust beneficiaries up-to-date on the health of the trust, providing them with any necessary account statements and tax reports. If the trustees have questions about the trust, it is up to the trustee to resolve them.

Mediation may be an alternative to estate litigation for some

When it comes to a dispute regarding a loved one's estate plan, is estate litigation the inevitable result? Not necessarily. It is possible to address disputes regarding a loved one's estate plan through forms of alternative dispute resolution, including mediation. Mediation can be a way for families in California to put their differences aside and work together to come to a resolution that meets everyone's needs.

Mediation can be preferable to estate litigation, because it allows all parties, including the elder person whose estate is the subject of the dispute if he or she is still alive, to communicate their concerns and preferences. It is a way to preserve relationships and encourage healthy communication. Mediators may also connect parties to community resources that could help them.

Divorce is a great time to revisit your will and estate plan

At the end of your marriage, one of the last things you likely want to think about is the potential for your death. However, it is extremely important to review your estate plan during any major life change. If you don't, you could end up leaving people on your will as beneficiaries when you no longer welcome them in your life.

You may also have appointed guardians or a health care proxy. If that was your ex-spouse, for example, you may want to change the guardian or proxy to a sibling, parent or child.

What are some options regarding the family home and divorce?

Home is where the heart is, which is why it is often a major sticking point when it comes to property division in a divorce. Spouses in California may both want to keep the family home post-divorce, or perhaps neither wants it. What is important is that spouses understand all their legal options when it comes to dividing the marital home in a divorce, so they can make informed decisions that are in their best interests.

One option is to award the family home to the party that wants to keep it and award the other party marital assets of a similar combined value. However, the party who wants to keep the home should think carefully about whether they can afford to do so. After all, repairs will need to be made, the mortgage needs to be paid and insurance costs and taxes must also be considered. Since the person awarded the home will have to pay all these expenses on a single income, some people may find that they simply cannot afford to keep the family home.

Divorce, whether amicable or not, is a reality for many

No couple saying their wedding vows anticipates that their marriage might not last. After all, they are pledging to stay together, "'til death do us part." However, the reality is that many couples in San Mateo will find that as the years go by, their relationship is no longer tenable, and they are best-off getting a divorce.

Some divorces are amicable, with the couple being able to set their differences aside long enough to reach an agreement on their divorce legal issues. Mediation can be one way for some couples to settle their divorce out-of-court. But, the end of a marriage is not always an easy time, and sometimes, couples find they must turn to the court to make decisions on child custody, child support, spousal support and property division.

Even a comprehensive estate plan could be subject to litigation

A person in California can carefully execute a comprehensive estate plan, with the hopes of making it clear what their wishes are with regards to who will inherit what, as well as what end-of-life care they desire. Yet, no matter how detailed their estate plan is, once they pass on, there is always the potential for litigation. Grief aside, sometimes, an heir has a legitimate reason to contest a will or trust.

For example, they may believe the deceased was subject to fraud or undue influence when he or she executed the will or trust. This may be especially true if the person's mental or physical health was declining, making them dependent on the care of others who may have taken advantage of their vulnerability. It could be argued that the deceased lacked the testamentary capacity to create a will or trust. Even suspected forgery could be a reason to contest a will or trust.

What spousal support factors will California courts consider?

Unlike child support, there is no statutory formula for calculating spousal support. When a judge is issuing a final order for spousal support, under California Family Code, Section 4320, he or she may take the following factors into account.

One factor is the earning capacity of each spouse and whether it is enough to keep up the standard of living the couple enjoyed while married. When determining earning capacity, the judge will consider the marketable skills of the spouse seeking support and the applicable job market wherein the spouse can utilize these skills. The court will also take into account the time and cost it will take for a spouse seeking support to obtain these skills.

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The Cohen Law Offices, PC
1720 S. Amphlett Blvd.
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San Mateo, CA 94402

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