Would your personal representative be able to track down all your bank accounts and pay all your bills that are setup for web access? Could your family recover pictures and videos that you have stored with services such as Picasa or Flickr? Dan Rosenwald at the Washington Post ran interesting article on digital data and services that allow your heirs to take over your on-line accounts. Some of the sites mentioned were Legacy Locker, Bcelebrated.com, DataInherit, Entrustet, Parting Wishes, VitalLock, My Last Email and If I Die.

These sites serve a new need and the emphasis of the sites varies. All sites let you store your accounts and passwords. This is the critical item, but you must keep the information current to be of value to your executor. Similar information may already be stored with Password Keeper or Online Vault among others. The sites that focus on what to do in the event of your demise also allow you to store a letter to your family or some special wishes. Much of this information can be stored on paper. However, the sites assist you in gathering important information, storing it, and make updating the information easy. Some of the sites will assist your executor in taking down sites and closing out accounts. I think it is too early to tell which sites will be the survivors, but digital records are not going away. If you have valuable on-line records, you should consider one of these providers. In addition, have your attorney include a beneficiary for your digital assets in your will or trust.

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Premarital Agreements

by stevenberger on January 5, 2010

Grandma & Grandpa002

The November issue of Money Magazine published an article “Marrying Finances – For the Second Time.”  Karen Cheney points out tree instances “When a Prenup makes Sense:

  1. … have a family business.
  2. … have vastly more savings than your spouse.
  3. … have kids from a previous marriage.”

Premarital Agreements are enforceable contracts under Maryland Law.  However, the parties to a premarital in a fiduciary relationship requiring one of the two following elements to be enforceable:

  • The agreement must be fair to the weaker party at the time of execution; or
  • The agreement must be executed voluntarily and with fair financial disclosure.

In addition, the contract must contain all the necessary elements of a valid contract.  Three additional requirements necessary for a Premarital Agreement are:

  • Both parties must have legal capacity to contract and the assumption is that an adult is mentally competent.
  • There must be consideration for the contract.  However, marriage itself is a valuable enough benefit that no other consideration is necessary.
  • The contract must be executed voluntarily, without fraud or duress.

Fairness and disclosure are key elements to the premarital agreement.  As Estate Planners the most common situation we deal with is the second marriage where both parties want to ensure that their assets pass down to their children.  Proper planning is necessary to ensure that all the children are treated fairly.  Adult children often have a difficult adjustment to seeing Mom or Dad getting remarried.  If they feel they are being cheated out of their inheritance, the resentment of the new spouse can hinder the family relationship.  Our office can coordinate the Premarital Agreement with as Estate Plan that accounts for the assets both parties are bringing to the marriage.

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Inherited IRAs

December 26, 2009

I recommend using this format: John Smith IRA/ Deceased 1/1/2009/ FBO (for the benefit of) Mary Smith as beneficiary.
Make sure that the financial institutions gets the titling right not only on the statements it sends to you, but also on the internal records it uses for reports to the IRS, he says. Some large IRA [...]

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Planning for the Generations

August 14, 2009

I just returned from a four day symposium on issues of concern to Estate Planning attorneys. The question of what will happen with the estate tax in 2010 seems to be overshadowed by healthcare issues. However, everyone is in agreement that Congress will not let the Estate Tax lapse in 2010. A big concern right [...]

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Four Reasons You should have a By-Pass Trust

June 5, 2009

1. Tax Savings – A trust established by the first spouse to die effectively doubles the estate tax exemption. For 2009 the Federal exemption is $3.5 million and the state exemption is $1 million in Maryland.
2. Keep the money in the family – The first spouse to die leaves the money for the survivor to [...]

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Advance Directives

April 9, 2009

Last month I was asked to speak at a retirement conference on the need for everyone to have an Advance Directive. An Advance Directive is a combination of powers of attorney for medical decisions and a living will. The powers of attorney names an agent who will make decisions for your medical care in the [...]

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Beneficiary Designations

April 9, 2009

Beneficiary designation is critical to your estate plan especially when naming who gets the proceeds of your life insurance proceeds and your retirement plans. These funds are transferred directly to the people you name without going through probate. A spouse has the option of rolling over retirement monies into his or her IRA. Required distributions [...]

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Converting to a Roth IRA

March 12, 2009

In 2010 the income limitation for converting traditional IRA to a Roth IRA will be eliminated. Furthermore, one half of the conversion income can be reported in 2011 and the final one half of conversion income can be reported in 2012. Whether paying the tax for future tax free withdrawals depends on many factors, but [...]

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Charities

March 10, 2009

I am spending this week transporting the homeless in my community. This year we see an increased number of able bodied people left homeless because their jobs have been eliminated. I urge that everyone writing a will or revocable living trust consider a gift to a charity that helps those who have fallen on hard [...]

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By-Pass Trust

March 4, 2009

Many of you have seen your estate values cut in half or more while the Federal Estate tax minimum has gone from $2 million to $3.5 million. The feeling is that you do not need to do any estate planning. The problem is that you do not know what the law will be at the [...]

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