What Are the Phases of Trust Administration?

Establishing a living trust can be a smart estate planning strategy for people who want to allow their beneficiaries to avoid the time and expense of probate. However, it's important to closely follow the trust administration process so that each phase is completed correctly. An experienced attorney can help guide clients through the process outlined below.

Inventory and Valuation of Assets 

The initial step of estate planning involves creating a complete catalog of all assets, including those that will be held in the trust and those that are in the estate but separate from the trust. Each asset must be accurately valued for tax purposes and labeled to establish ownership. Certain items may require an appraisal by a specialist. After valuation, assets must be retitled to reflect ownership by the trust, not the individual.

Asset Allocation

Living trusts can have an A/B or A/B/C setup, which allows a surviving spouse to serve as the beneficiary while helping them avoid the cost of estate taxes, Medicaid spend-down of assets, and creditors. When he or she is deceased, the trust will pass to the couple's children or other established beneficiaries.

Upon the individual's death, the named trustee is responsible for gathering the estate's assets and paying any outstanding bills or death taxes. He or she will then distribute the assets according to the instructions created when the trust was established.

Tax Obligations

The trust administrator must register with the IRS for a separate tax ID number for the trust by filing Form SS-4. When the decedent dies, it may be necessary to submit Form 706 (Federal Estate Tax Return) to establish a value for the assets held by the trust. The person's spouse is exempt from estate taxes up to the threshold set by the IRS, which is $11.4 million per individual as of 2019. Trust assets exceeding this value will be taxed at 40 percent. If the estate is taxable based on this cap, Form 706 must be filed within nine months of the decedent's death.

Depending on the specifics of the situation, other tax forms may be required. These often include Form 1041 for income tax payments, Form 5495 for discharging personal liability, Form 56 for establishing a fiduciary relationship, and Form 4810 for requesting a prompt assessment.

Because estate planning is such a complex process, the guidance of an experienced attorney can help ensure that your wishes are fulfilled and your beneficiaries are taken care of. If you live in Victorville or another part of the Inland Empire, contact Medeiros & Associates Lawyers at 760-241-1234 to schedule a consultation.

What Are Considered Non-economic Damages in California?

When a plaintiff files a claim or lawsuit to acquire compensation, two main types of damages are considered: economic and non-economic. Economic damages are those that can be assessed with concrete financial documentation, including hospital bills, property damage receipts, loss of income records, and more. Non-economic damages are subjective in value and tend to involve damage to a plaintiff's quality of life. Here are a few examples of non-economic damages.

Pain and Suffering 

Personal injuries often cause suffering, both physical and emotional, long after hospital bills have been paid. For example, a back injury can cause pain and limited movement for years or decades, and the emotional trauma of an accident can affect a person's long-term emotional health and well-being. Any lasting physical or mental effects of an accident may be considered non-economic damages in California.

Disfigurement

Non-economic damages also include when an injured party is left physically disfigured from scarring, burning, or facial damage. In addition to causing physical distress, the impact of such disfigurement can have lifelong effects on the injured person's emotional health. These cases are usually the result of serious car accidents, dog attacks, and other severe circumstances.

Loss of Consortium

Loss of consortium describes non-economic damages that affect a person's relationships. Accidents and injuries can place enormous amounts of stress on marriages, relationships, and family structures, so it is not uncommon for there to be negative effects down the road. Loss of consortium damages can include divorce, the loss of love or emotional support, and the disruption of normal sexual function.

Because of the subjective nature of non-economic damages, make sure you have an experienced attorney on your side. The staff at Medeiros & Associates Lawyers has helped clients in the High Desert manage a variety of legal issues for decades. Schedule a free consultation for your case today by contacting us online or calling 760-241-1234.

The Importance of Having a Mediator During a Divorce Procedure

Divorce can be an emotionally taxing process, and it's easy for emotions to get in the way of making serious decisions. In order to stay level-headed, many divorcing parties opt for mediation, which can offer many benefits to the process.

What Is Mediation?

Because of the emotional nature of divorce, many find it difficult to stay rational and fair during the proceedings. A mediator acts as an expert who steps in as a neutral party that meets with the couple to resolve any issues that arise during the divorce. While the mediator won't make any of the decisions themselves, they facilitate decision making and offer an objective point of view on any outstanding issues between the couple. This process is popular in different types of family law to preserve relationships.

Benefits of Mediation 

Divorce can be a surprisingly expensive process, so one main advantage of mediation is that it is much less expensive than a court trial or a series of hearings. Because the process stays out of the courtrooms, it remains confidential, and no public record is taken of what happens during the sessions. This also means that both parties can agree on what's fair themselves without impersonal legal principles taking the reins. Some even find this can improve communication between the couple, leading to better problem-solving down the road, which can be particularly helpful when children are involved.

Choosing a Mediator 

In order to ensure the mediator chosen is neutral, both divorcing parties must agree upon who will serve as a mediator. Mediators are often attorneys, and it's vital to find an individual who has experience mediating divorces. While mediation fees are normally less expensive than divorce proceedings, fees can vary, so it's important to do research and conduct a few interviews before deciding who will be best. Mediators can be recommended through divorce attorneys, and most courts provide a list of available mediators as well.

Ending Mediation 

After the mediation process is completed, the couples will agree upon a negotiated settlement, which will be drawn up by the mediator. At this point, it's a good idea for each individual's attorney to review the agreed upon settlement before it is signed. Then the settlement is submitted to court where it will be entered as part of the official divorce decree.

Many couples decide to turn to mediation instead of going through the lengthy process of court divorce proceedings. If you'd like more information about mediation or divorce proceedings, contact Medeiros & Associates Lawyers online today or call us at 760-241-1234.

Four Child Custody Facts Divorcing Parents Need to Know

During a divorce, child custody is often one of the most contentious areas of dispute. However, understanding their rights and obligations can help ex-spouses remain civil and ensure that the well-being of the entire family is protected. Here are four points to remember about child custody during the dissolution of a marriage. The guidance of an attorney who is experienced in family law can also ease this challenging situation.

1. Co-parenting is good for children. 

Research shows that children of divorce whose parents share a cooperative relationship feel secure, benefit from consistency between two households, have a healthy example of relationships and problem-solving, and are healthier mentally and emotionally than children whose divorced parents are in frequent conflict with one another.

2. Joint legal custody is not the same as joint physical custody.

Parents seeking joint custody should understand the different types promoted by the court system. Joint legal custody means that important decisions about the child's education, medical care, and welfare are shared equally between the parents. Joint physical custody, on the other hand, refers to equal parenting time. Parents can have joint legal custody without also having joint physical custody, and parents who want both are often required to collaborate on a parenting plan that will be approved by the court.

3. It's not always necessary to go to court.

Parents who are able to come to an agreement about child custody, often with the assistance of a joint attorney or separate attorneys, do not need to submit to a judge's decision about custody. If additional help with negotiation is needed, many families are able to take advantage of mediation. This structured process helps ex-spouses reach an agreement with the facilitation of a trained mediator.

4. Decisions are made based on the child's best interest.

For those who are unable to reach an agreement, the family court judge will make a decision about child custody. He or she uses a metric known as the "best interest of the child," which takes the following parental factors into account:

- Living situation

- Existing relationship with the child

- Willingness to support the child's relationship with the other parent

- Age of child or children involved

- Preferences of the child, especially those who are older

- Stability

The court will also consider existing evidence of abuse or neglect.

Even in a volatile divorce, it's essential for ex-spouses to separate emotions from behavior when it comes to child custody. Keep these four guidelines in mind to help navigate the rough waters of divorce, and contact Medeiros & Associates Lawyers for guidance throughout the process.

3 Tips for Dealing with Debt Collectors

When financial trouble makes it difficult to manage debts, debt collectors may begin calling. Handling this situation wisely will help prevent it from getting more severe.

1) Investigate 

The first action to take after receiving a call or a written notice is to investigate the claim. One should request a credit report to ensure that the debt is accurate.

2) Resolve Inaccuracies

If the debt seems to be incorrect or is a result of identity theft, one should send a letter to the debt collecting agency explaining the inaccuracy and stating that the debt will not be paid. This letter should be sent via certified mail within 30 days of receipt of the initial notice. Letters and documented proof of the error should also be sent to credit bureaus, requesting removal of the debt from current reports.

3) Negotiate Wisely

If a debt is accurate, ignoring the notice is never wise. Instead, one should respond quickly to the notice. Negotiating repayment terms is often possible, especially when responding in a timely fashion. After negotiating a repayment schedule, get the schedule in writing and follow through.

Although debt collection agencies can use intimidating techniques, those in debt should strive to remain composed and respond cooperatively.

What Is the Purpose of an Advance Health Directive?

An advance health directive is a legal document that spells out a person's health care preferences in the event that he or she is no longer able to express these wishes.

Contents of an Advance Directive 

In an advance directive, the individual outlines the procedures he or she does and does not want to undergo at the end of his or her life. This can include wishes about resuscitation, diagnostic procedures, surgical procedures, organ donation, and pain management. The advance directive typically also notes whether the person wants to receive hospice and other types of care in a hospital, at home, or in another setting. The document also indicates the person who has been chosen to carry out thes wishes if the individual is unable to do so.

Preparing an Advance Directive

The first step is to discuss one's end-of-life wishes with close family members and healthcare providers, including the person who will be responsible for ensuring that the advance directive is followed. Once a person has made his or her decisions, an experienced attorney can help prepare the necessary advance directive forms.

While everyone has the right to determine his or her health care, it's important to make sure that key people are aware that an advance directive exists. A signed and completed copy should be kept in an easily accessible location and given to responsible family members and health care providers.