avoid probate

Can You Avoid a Succession or Probate in Louisiana?

Once people find out what is involved in a Louisiana probate, from why it is necessary, to all of the steps that are involved, to the time that it takes to complete a probate in Louisiana, to the costs of the proceeding that are involved, many Louisiana residents ask, "Can I arrange my estate to avoid probate?"

There is an easy answer to the "Can I Avoid Probate?" question. The answer is "Yes." But the tricky part can be, "How?"

It can get really complicated if you do not know what you are dong. There are many different kinds of assets: bank accounts, investment accounts, retirement accounts,  mineral interests, real estate interests, there's usufruct and naked ownership, limited liability companies, partnerships, corporations, vehicles, boats, trailers, RVs. 

How probate in Louisiana gets avoided depends on which types of assets you own and how does the state enable you to arrange or title things so that your survivors don't have to go through the government or the courts to simply pass that along to a loved one.

So, probate can be avoided so long as you work with the right people and get it right the first time.  You may need to utilize different vehicles to avoid probate, whether that is beneficiary designations, titling assets a certain way, using trusts, or taking advantage of Office of Motor Vehicle rules.

It just takes a little know-how and some planning to put together an estate legal program that avoid the Succession or Probate in Louisiana. Remember, some people think, however, that by writing a Last Will and Testament, they are enabling their heirs to avoid probate. But this just isn't true. 

Four New Client Matters Yesterday - Your Concerns May Be Similar

From time to time I will provide a summary of the issues that I deal with on a certain day so that you can perhaps comment on them, or at least get a feel for what kind of issues we deal with so that you will know that perhaps you are not alone in the kinds of issues that are important to you and your family. Yesterday, I had four new client meetings. Without revealing any confidentialities, the following are four separate summaries of new client meetings that I had with new estate planning clients.

  1. Friend Needs Estate Planning Legal Work. The first discussion I had was with a friend who owns a successful business. He said he was working with some financial advisors from out of state. His goal was to set up an estate plan for he and his wife so that after they both passed away, their business and other assets would transition the right way to his kids. We discussed business ownership, estate tax, irrevocable life insurance trusts, and updating all of his estate planning legal documents which were prepared by another attorney more than 15 years ago when his kids were very young. We'll be meeting again in the coming days or weeks ahead to finalize an estate planning legal program for him.
  2. Couple Wants Each Child To Receive A Certain Piece of Property. My second meeting was with a couple who wanted to avoid probate and make matters simple for the kids. Even though the husband made most of the big financial decisions for the family, it was the wife who really wanted to have everything simple because she was worried that her husband might die first. The couple also had two pieces of real estate - their home and another piece of property. For specific reasons that they indicated, they wanted one piece to go to one child, and another piece to go to another child, and the rest of their estate to be divided equally among the two children. Assets we addressed included: avoiding probate, estate tax avoidance, avoiding capital gains tax on the sale of property, who to designate to handle matters when they die, income tax aspects of inheriting an IRA and a stock portfolio, the wife's need to rely on their CPA if the husband dies first.
  3. Surviving Spouse Wants To Simplify Complex Estate. We worked with a family that had in the past set up some complex trusts for their children and grandchildren. The surviving spouse now wanted to simplify the surviving spouse's estate, leave it to the children, and then ultimately let the children inherit it and figure out how they can provide for their children. Issues we addressed included: estate and gift tax avoidance; lifetime charitable giving; giving to charity at death; naming an executor of a Will; updating prior estate planning legal documents.
  4. Avoid Probate and Avoid Nursing Home Poverty. My final new client meeting of the day was with a couple that was very clear from the outset of the discussion. The husband had been through a nightmare probate in recent years and he was very clear that he wanted his family to avoid the two probates that they would otherwise have to go through after he and his wife died, and they did not want to lose assets due to their possible future nursing home expenses. Issues we addressed included: Medicaid Planning; IRAs and SEP-IRAs; avoiding probate; how to handle bank accounts and CDs; Irrevocable Trusts for Medicaid Planning; how to title boats and vehicles to avoid probate.

I also took a call from a potential Probate client, but I told them that I was not the attorney for them. The woman's attorney/friend referred her to me. Her mother had died but the daughter did not have a good relationship with her two step-siblings. The mother owned a home but died with a Will or with any estate planning legal documents in place. Since this was likely to be an adversarial matter between the parties that would likely last for years in the court system, and since these matters never work out well, I told them that I would respectfully decline their offer to have me represent them in the potentially hotly contested matter. I wish them well. 

What If I Already Have a Trust?

I was speaking with one of my partners recently (our firm has estate planning lawyers in 10 states), and he had been approached by a number of different people who already had trusts as part of an estate planning program that had been set up for them years earlier, and they were inquiring about the necessity of updating their estate plans and programs.

We talked about how recent law changes can affect trusts and estate plans that were prepared just a few years ago, and we talked about - of course - how families often have a change in circumstances which can sometimes require that old estate plans be thrown out the window.

The following are several of the "I already have a trust" situations I've seen in recent weeks:

The "Pre-Portability" Trust. Trusts drafted and implemented about three or more years ago required complicated estate tax planning provisions which made things complicated when the first spouse dies. These trusts required that all or a portion of the revocable trust become irrevocable upon the first death - all of this was required to keep the assets of the first spouse to die from being lumped into the estate of the surviving spouse. With new portability provisions in our federal estate tax - made permanent in January, 2013, it is often no longer necessary to have all of these complications in the legal documents. Married couples are now permitted to exempt $10.9 million of assets from estate tax - even without the creation of multiple trusts upon the death of the first spouse. Bottom line - if you have a revocable trust that was customized for you prior to 2013, it may be necessary to restate your trust - in order to make things easier for your family when you die.

The "I Hoped My Old Trust Protected Me From Nursing Home" Trust. We see many people who set up revocable living trusts 5, 10, 15 years ago. The primary purpose of establishing the trust was to avoid probate. Perhaps they set up their trust when they were 55 years old. Now the couple is 70 years old and they are worried that nursing home expenses may deplete their estate. They always tell me that years ago when they set up their trust, they did not address the potential for nursing home poverty. Because their concerns now have changed, it is likely necessary to ditch the old trust in favor of a new trust that would not only avoid probate, but would protect the home, property, and life savings from nursing home depletion. Bottom Line - a common theme these days - you may not be crazy about starting over with your estate planning, but it beats the heck out of the alternative of losing everything you've worked for because you were too stubborn to visit with an estate planning lawyer more than once during your lifetime.

The "I moved here from another state" trust. We see folks all the time that have moved to one state after creating trusts and other estate planning documents in another state. If you create estate planning documents in one state - and then move permanently to another state - you should have your estate plan reviewed and re-done in that other state. While your previous documents may still be valid, complications can occur if you die and you have a Last Will (also called "Pour-Over Will") from another state. It's more complicated to probate an out of state Will. Also, if you moved into another state and purchased a residence, you better make sure that your new residence is titled in the name of your trust. Many folks who move to another state neglect to title their new residence in the name of their trust - requiring a probate (or two probates for the married couple).

The "I want to make some changes" trust. I met with a couple recently. When they created their original trust, their children were minors, and the couple designated their parents as having all of the positions of authority. Now the children are grown, the parents are frail, and major changes are necessary. Rather than keep the existing trust and make a ton of amendments to an old trust, it's cleaner to "Restate" the old trust and create a brand new "Restated" trust.

Due to constant law changes, changes to family situations, and changing trends, estate planning can never be a "one-shot deal." You can't just "set it and forget it". Would you abstain from going to the doctor because you "already did that once several years back"? Would you bypass the dentist because you "did that already 15 years ago"? Only go to the car mechanic once because you see no need to "pay him twice"?

These days you need a long-standing trusting relationship with an estate planning attorney that can guide you and your family through the estate planning landscape as you and your family mature, and as lawmakers annually (at least) tinker or make wholesale changes to our legal, tax, and financial world.