Estate Planning attorney Baton Rouge

Handling a Louisiana Succession When Surviving Wife is Bequeathed Usufruct

I was working with a family over the last few years. The surviving wife called me after he husband died about two years ago. She wanted to get his "estate settled." She said he had a Last Will and Testament leaving her everything.

Ownership or Usufruct?

When she came in and showed me the Will, I realized that he had not left her "ownership" of everything, rather, he left her "usufruct", a form of ownership recognized only in Louisiana.
The husband left two daughters, and I told the surviving wife that we would have to get her two step-daughters involved in the Succession since they were the "naked owners" and needed to be part of the settling of her husband's estate.

Well, two years later after the daughters and their husbands prolonged court proceedings because they demanded accountings of all of bank accounts, CDs, investment accounts, IRAs, annuities, and Savings Bonds, the relationships are now strained and the surviving wife is now saying, "How can I make sure that MY CHILDREN don't have to go through all of this when I die?"

Easier Access When Wife Passes Away

So, we're setting things up now so that when she dies, her children will immediately inherit from her, and her husband's children will immediately get what they are entitled to from their father's Louisiana Succession. Certain things will be held in trust so there will be easy and immediate access to heirs when she dies, without having to go through the complexities, delays, and costs of probate.

If you live in Louisiana, whether in Baton Rouge or New Orleans or Monroe or Lake Charles or Shreveport, and you want to make your estate settlement easy, give us a call at 866-491-3884, and we'll start a discussion about how easy it is to get all of this straight.

How To Avoid Income Tax on IRA Distributions After You Die

Let's face it. many people HATE paying tax. And many people hate paying income tax when distributions are made from their IRA.

I was working with a gentleman from Covington, Louisiana today on his estate plan. He owned property in St. Tammany Parish and in Tangipahoa Parish. He had never been married and he never had children.

He wanted to leave some things and some money to a family member of his, but he liked the idea of setting up some scholarship funds. So, after quite a bit of discussion, he decided to name his college as the beneficiary of part of his IRA when he died. But he did not want the funds from his IRA to go into the general funds of the college. So, we are restricting the IRA so that it can only be used in a certain curriculum of the university. Now, he knows that students in his prior field will benefit from scholarships that he establishes.

He also knows that none of his IRA will go the federal government or the State of Louisiana (or any other state for that matter). By naming his college as the beneficiary of his IRA, even if the money can be used for certain restricted purposes, the distributions after his death to the college will go income-tax free.

If you are leaving some assets to individuals when you die, and other assets to charities or educational institutions, you may want to consider leaving all or part of your IRA to the charities. Charities don't pay income tax when they are the beneficiary of an IRA. Leave your non-IRA assets to individuals - there will be no income tax consequence to those individuals.

If you live in Louisiana and you want to set up an estate legal program that makes sure that you leave assets where you intent them to go, and it is all set up in a tax-efficient or tax avoidance manner, give us a call at 866-491-3884 to talk to one of our estate planning attorneys.