Adding this for the DIY’ers out there:
Any estate under the $5.43 million exemption for a decedent is not required to file an Federal estate tax return (Form 706) BUT:
A filing is required in order for the deceased spouse’s $5.43 million exemption to transfer (portability) to the surviving spouse.
Unlike the rest of you folks, my DH and I are lacking end-of-life documents, therefore we are considering taking advantage of a recent offering by a professional group of which I am a member. An estate attorney has been selected to provide will preparation services which include a will, advanced health care directive and DPOA. Does $395 seem like a reasonable fee for a married couple to pay for these services? Is a 1/2 hour appointment long enough to provide a quality end product? Assuming we might need to make revisions to these documents in the future I have 2 concerns: 1) there is a good chance that this aged attorney will no longer be in practice at that time, and 2) this attorney does not have a “local” office (over 1 hour away). Would we benefit more from finding someone local? As an alternative, could we consider a DIY option?
Any advice or recommendations are welcome.
@SNLMom I think the fee is reasonable! You know it will be done correctly for your state. You may find out some things prior to appt to have you going in prepared and using the time well. Ask secretary or paralegal if there is some info for you to read, prepare beforehand, any helpful list.
@SnLMom, the fee is reasonable and the service a good start on your estate plan. Just be on the alert that the estate attorney doesn’t try to “upsell” you to a trust ($2000+) unless you feel that’s what you need and want. My employer has offered a number of financial service educational seminars/services sponsored by private firms and invariably they are using the opportunity to fish for clients for their more expensive services. In past years almost everyone was encouraged to draw up a trust. A trust is useful if you want to control how your heirs will inherit assets or if you have a special needs dependent. The will, advanced health care directive and DPOA are key components of a trust, so you could always use those later if you decide on a trust at some point.
I wouldn’t worry at all about the distance to the attorney. Our trust attorney is 3 hours away and I communicate with her mostly by email. Some attorneys will keep copies of your documents in their files, but you should keep the original in a safe place where others know where to find it. Changes to a trust or will are added as amendments or codicils. The edited or added sections are attached to the older document so there is no question about your intent to change the document. Most of the language in wills and trusts is fairly boilerplate and any attorney will be able to modify it at a later date. A good attorney, especially someone older who has ‘seen it all’ can answer lots of questions in a short time. For such an important undertaking I think it’s worth getting the professional advice
@SOSConcern – Great idea. I will definitely ask about prep materials.
@momsquad – Thanks for the the warning. I was wary about the possibility of an “upsell,” although I wasn’t sure how it might be presented. It’s reassuring that the documents can be amended by another attorney in the future.
that price is very reasonable. i worry that a half hour is not enough. The POA and health care directive are easy forms. My lawyer added codicils to the Trust, and changed how the Title of house written.
@SnLMom
Here are my thoughts on your questions:
(1) “Does $395 seem like a reasonable fee for a married couple to pay for these services? Is a 1/2 hour appointment long enough to provide a quality end product?”
$395 is reasonable but whether it is money well spent is a slightly different consideration. It is not a small sum of money and what you should be buying is expertise more than the forms themselves. As you know, many of those forms are available through DIY websites, particularly the non-property end-of-life documents. There is a link somewhere in this thread to MPOA and advanced directives.
Concentrate on whether the attorney’s expertise is satisfactory to you and the 1/2 hour consultation is sufficient for the special issues you need addressed. My guess is that he/she will offer a “standard” will that can be modified with the insertion of different language for various dispositions. The rest is legal boilerplate that mirror provisions of your state’s probate statutes.
Whether 1/2 hour is adequate: only if you are well-prepared and ask the right questions. As suggested, you should contact the attorney’s assistant / paralegal and ask for estate planning checklists that you can review and complete beforehand. Additionally, you should make a list of any special circumstances that you must address in your will / trust arrangement. If you have situations outside those that what a “vanilla” will generally addresses, you will incur additional fees because of attorney time.
(2) “Assuming we might need to make revisions to these documents in the future I have 2 concerns: 1) there is a good chance that this aged attorney will no longer be in practice at that time, and 2) this attorney does not have a “local” office (over 1 hour away). Would we benefit more from finding someone local?”
Locality is not a problem, generally, unless the attorney is in a different county. Probate courts typically have county jurisdiction and there may be some strange quirk that your county requires. Also, when the wills are probated, they are generally filed in the county probate court at which the deceased last lived. Attorney fees will include travel time.
Continuity of service may be a small concern, especially if your executor and heirs will need some hand holding. It is not necessary, but families often use the same attorney who drafted the will and trust to advise when they come into operation. Do you feel comfortable about how these situations will play out.
(3) There is much you can do yourself before the drafting. Many of those items are addressed throughout this thread. In fact, the housekeeping aspect of estate planning is the part that rests most on the testator. Depending on the nature of your assets, there is much you can / should do to get your estate in order so that the will addresses the assets that do not descend according to some other measure.
Other considerations:
(1) you should clarify the attorney / paralegal’s hourly billing rate
(2) what you will receive for the $395. If you will be charged for any questions or revision of the documents (before signing), then you need to know
@SnLMom
Here are three different checklists found on the web to help organize your information:
http://estate.findlaw.com/planning-an-estate/estate-planning-checklist.html
http://www.schwab.com/public/file/P-3590475/Final_Estate_Planning_Worksheet___3.24.pdf
@AttorneyMother
Wow … so grateful for the detailed reply. I have printed the 3 checklists you linked and added them to my agenda for the weekend. This attorney is located a few counties away, so we’ll have to give that some thought before proceeding.
@SnLMom
You are welcome.
If it helps, you might consider photocopying the “title” page of your accounts and assets so that your attorney can assess the type of joint ownership you and your H have. Jointly-owned assets pass to the surviving owner, and it’s very important that all TOD/POD and beneficiary designations are revisited and properly redone soon after the death of one co-owner.
Don’t forget your automobile titles.
@AttorneyMother, I just read through most of your thread.
In a community property state, if a brokerage account is in the husband’s name and and he dies, and there is no TOD, don’t the assets flow to the wife anyway?
If you have TOD accounts, why do you need a living trust to prevent probate?
I have a living trust. I am wondering why I have one. 
My wife and I am going to see our attorney soon. We want to change a few things slightly.
These is my understanding, but I’m not a marital attorney and I do not live in CA:
– in a CP state, each spouse is deemed to own 1/2 of assets accumulated during the marriage
– titling of accounts is not determinative of the status of assets as CP or separate property for a number of reasons, chiefly because the H may be keeping the account separate from commingling, there may be a prenuptial agreement, etc. ← but this only decides whether the account gets thrown in the CP “pot” in a dispute about its nature as CP
About the brokerage account:
– if the brokerage account = CP → the wife already owns 1/2 of the account ← she does not have to inherit that 1/2
– when H dies, W gets her 1/2 interest but without anything else in place like a TOD, then H’s 1/2 interest would go into his estate to be distributed either in accordance with his will or the intestacy laws
If you want to avoid having descent of the brokerage account go through probate, then you should consider having a TOD in place and name your W the primary beneficiary, with others as secondary beneficiaries, as desired:
– once a valid TOD is in place: it is typically a simple matter of having your executor or beneficiary furnish a death certificate, your beneficiary fill out a new account application (or whatever), and the securities will be transferred in kind to a new account with the beneficiary’s SS#
– in a CP state, the W gets the step-up basis for the all the holdings of the brokerage account
– ^^ I’m fairly sure about this result, but I don’t have time to dig up the citations right now. I posted something about it in the Retirement thread.
The revocable living trust:
– some people want to the RLT to hold title to their assets so that (ostensibly), the trustee of the RLT can manage their financial affairs if they become disabled
– the assets held within the RLT are not subject to probate in that they will not pass through the decedent’s estate because those assets are no longer owned by the decedent at the time of death
@dstark, but here is a caveat: simplicity is not always the solution. The TOD works well if the beneficiary is who you want to own the assets outright, simply and cleanly. If there are concerns because or about, among other things:
(1) the beneficiary is not able to manage the account
(2) the beneficiary’s creditors or spouse
(3) keeping the assets out of the beneficiary’s estate – for inheritance issues or estate taxes
Then there are very good reasons for a trust. In those cases, a family RLT may not be the way because those are not irrevocable trusts until the death of all the grantors.
If you have complex issues, you need an estate plan that addresses everything.
@AttorneyMother, ok. Hmmmm. I have to think about a few things. Thanks.
I’m bookmarking this thread.
@dstark , here’s a rudimentary Fidelity outline of estate planning in the context of financial accounts:
https://www.fidelity.com/viewpoints/personal-finance/estate-plan-pitfalls
Schwab:
Putting this here also:
Publication 551 addresses the Step-up Basis for community property:
http://www.irs.gov/publications/p551/ar02.html
The statutory provision that addresses the required 1-year holding period for the community property to receive the step-up basis is:
@AttorneyMother, that Schwab link is great. Thanks.
It’s a little annoying. I guess I am going to have to change a few things for the third or fourth time. I guess that’s par for the course.
@dstark , if you re-title assets, make sure you confirm with your attorney that you are doing it correctly. Especially check into Community Property with Right of Survivorship. Each state has its quirks. Look here:
http://www.titleadvantage.com/mdocs/Right_of_Survivorship.pdf
@AttorneyMother, That’s a very interesting link. Very informative. Thanks.