Situation: Representing 55 year old husband. Second marriage 5 years. Wife has decided not to participate in planning, “will do at another time”. Husband has two adult children, ages 21 and 24. The 21 year old has special needs and will require a Special Needs Trust. Wife has one 16 year old child.
Assets: $500,000 FMV home with $200,000 mortgage that is owned jointly with survivor rights with wife. The couple has agreed to own the home as tenants in common (each share to go to their respective children but each retains the right to live at the property during their lifetime). Maine cottage co-owned with siblings (inherited from parents). Coordinate with Maine Attorney to put husband’s ¼ interest from the Maine home into a Realty Trust, leaving his interest to his 24 year old and his 21 year old’s Special Needs Trust. Husband has a $100,000 life insurance policy. Confirm husband’s wishes that he wants 100% of the policy to go to his wife and if she predeceases him, then 50% of the policy will go to his 24 year old child and 50% will go to his 21 year old child’s Special Needs Trust. All other combined assets add up to less than one million dollars, confirming that no estate tax planning is wanted and/or needed at this time.
Legal:
- Last Will and Testament: P.R. (Personal Representative a/k/a “executor”) is client’s younger brother. The backup is client’s sister.
- Power of Attorney: Client’s wife as the primary and his brother as the backup.
- Health Care Proxy: Same as Power of Attorney
- HIPAA Medical Release Form: Same as Power of Attorney
- Deed: Property to husband and wife as Tenants in Common.
- Deed: Husband’s ½ interest to Realty Trust with Family Trust as the beneficiary.
- Family Trust: 50% of assets to 24 year old child and 50% to 21 year old child’s Special Needs Trust. Client’s brother as Trustee, and his sister as Successor Trustee.
- Special Needs Trust: Client’s brother as Trustee, 24 year old child as Successor Trustee.
