Good evening everybody. Thank you so much for joining me tonight. Uh it’s just a hair after six o’clock so we will get started. I do want to be very respectful of your time. Uh tonight’s topic is estate planning basics. My name is Joe Gaspari. I am one of the financial consultants here on the Alliant Retirement and Investment Services team. Uh what I do here typically every two weeks I do a different presentation. tonight on estate planning. Uh recently the seven things you need to do before retirement, then uh social security, Medicare, all of these various financial topics that might be important to you. So uh tonight we’re going to talk a little bit about uh estate planning where it says estate planning basics. I do want to be uh to let you know this is the basics of this. This is not getting too indepth. Hopefully, this is going to make you think, do I need to speak to someone? And hopefully, I will be putting up a survey at the end of this presentation that you and I can continue this conversation one-on-one with you directly and just to kind of dig into maybe just your future a little bit. And if it’s estate planning that’s uh heavy on your heart, then we can certainly talk about that. Maybe the answer might be I think you need to speak to an attorney um and get some uh you know estate things going especially if it’s complicated if you have multiple properties and or just a complicated uh beneficiary situation. So there’s many different reasons why someone might want a trust or just a will the powers of attorney for health care and uh financial all of these important documents that we’re going to touch on today. So, uh, as we get going with that, I do want to let you know that we cannot record these presentations. That does come up pretty much, uh, uh, quite often, uh, almost every presentation. Someone might ask if we can get a recording of it. We are not able to record and neither are listeners. Um, so we had seen some um, I believe it was competition that uh, uh, other adviserss that were recording our presentations. So it’s something that we cannot do. Uh so these cannot be recorded for compliance reasons. We are not able to also not able to give out the deck or the slides on these as well uh for compliance purposes. So hopefully if you do want to dig in a little bit more, please say yes at the end of the presentation uh and then uh we can certainly uh talk about what’s important to you and to see what steps are going to be next. I do have some other presentations coming up uh which is the IRA planning different you know traditional Roth uh the different tax consequences uh moving forward into retirement of uh many of us that I’ll use the term 401k rich meaning that that’s where a lot of our savings is um that and those are things that if it’s traditional regular 401k it’s all taxable coming out so I do want to uh let you know there’s some other opportun unities and planning that can be in place so every dime is not taxed in retirement. Maybe come up with some strategies for you there. So hopefully we’ll see you on that one. That’s Wednesday the 29th at 2 p.m. Then I have the Medicare presentation August 11th. Another evening presentation. This is a pretty popular topic. Same with Social Security. uh but uh digging into Medicare A B maybe the Medicare C uh the advantage plan Medicare D which is prescription drug coverage all of these different things how much are you expected to pay for this in retirement and we’ll dig into Medicare coming up soon uh educational resources you do also have access to see what other webinars are going to be available uh for you to listen to our uh invest savvy podcast and our Aerys Aerys meaning Alliant Retirement and Investment Services. Uh that is uh our team that I work with. So Aerys website and blog is available as I go through the presentation on estate planning. If you do think of a question, just go ahead and type it in at any time. If you think of that, just type it in. They will hold until the end of the presentation, which is when I will take those. But you can utilize the Q&A box or the chat box. It doesn’t matter which one. Uh but I I’ll have them both up and ready to go to answer any questions that you might have at the end of the presentation. So, let’s dig into what is an estate plan. It’s a map. It’s a road map of here’s what you want. Here’s how to put it in place to make sure things pass without maybe going through probate. Um, we’re going to talk about that. But, uh, you know, if we can avoid probate, if we can make sure that your wishes, maybe it’s, uh, artwork, maybe it’s jewelry that you have. Document, document, document. This is what, uh, basically a will is going to do for you. Documenting who gets what. Um, maybe there’s minor children under your care. Who’s going to take care of these minor children? That would be things that are in a will. So, a map reflects the way you want your personal and financial affairs to be handled in case of incapacity or death. Incapacity mean what if you’re in the hospital? What if you’re in a coma? What if? What if? What if? All of these various things that could certainly happen. And if you’re not able to act uh maybe even paying your bills uh because you’re in the hospital, who’s going to be able to take care of those things for you? So, who needs an estate plan? Chances are you do. uh not just for the wealthy. Without an estate plan, you can’t control what happens to your property if you die or become incapacitated. It makes your wishes clear, helps avoid family disputes. I’ve seen many many many uh times or cases of when someone passes away and maybe it’s just children, maybe it’s cousins, maybe it’s nieces and nephews that are beneficiaries, but family and money sometimes does not mix very well. Uh I’ve seen many cases of that. So, uh it’s certainly something please have things in writing. Uh proper estate planning can preserve assets and provide for loved ones. especially [clears throat] needed if your spouse is uncomfortable uh with financial matters. If you have minor children, who’s going to uh take care of or raise the children legally uh based on your wishes? uh your net if your net worth if you are in this range of over a $15 million net worth then we start to dig into estate taxes not state but estate taxes which is generally a flat 40% on stuff over 20 million or 15 million. So, as an example, 20 million, if someone has a $20 million estate and they pass away, the first 15 million is not subject to the estate tax, but anything above that, so 5 million would be uh subject to that 40% estate tax. If you own property in more than one state, you’ll definitely want to. There’s different state rules uh on especially if someone passes away on how things are passed. Uh financial privacy is a concern because probate is a public record. Uh so if it’s something that is important to you that you don’t want this to be public, then have an estate plan ready to go. And uh sorry for my voice here but uh sorry uh estate planning uh concepts. So planning for incapacity.
So healthcare, property management, planning for death, wills, probate, tax basics, lifetime gifting. We’re going to talk about gifting. How much you can give away while you’re alive legally. uh life insurance and trusts planning for incapacity. Incapacity can strike anyone at any time. Uh there’s been a case, it was a very famous case back in the ‘9s. Uh Terry Shybo, if that name rings a bell at all. I believe she was about 26 years old. Um she went into cardiac arrest and she was in a coma for a very long time. Uh so now her husband this is in the state of Florida her husband after a long period of time and doctors saying she’s not going to come out of this uh said let’s remove the feeding tube her parents got involved then again in the state of Florida and said no we are we should have a say so over the husband the parents should have a say so now we have courts involved where the husband says remove the feeding tube the parents said, “No, don’t do it.” And so then there was court case, court case, court case, and they finally sided with the husband and said, “You could remove it.” It was um eventually overturned and said, “Nope, side with the parents. Don’t do it.” It was about a I believe it was about a a 14-year process uh where this dragged on, dragged on, dragged on, and they ultimately said the Supreme Court got involved and said they could remove the feeding tube and she ended up passing away some days, you know, several days later. But, uh things that are not uh written now, we’re talking about a 26-year-old uh that who would have thought we need to do estate planning at 26 years old. But uh again, it could happen to anyone at any time. Failing to plan means the court would have to appoint a guardian, especially if there’s minor children. Uh lack of planning increases the burden for the guardian and your guardian’s decisions might not be what you want. So if it’s the court appoints someone that is not uh in favor of what your wishes are, they can do what they want to do because the court put them in charge of your estate. healthc care directives. Uh living will number one, having a will. A will is going to be put your instructions in writing. Here’s what I want to have [laughter] happen. So, and I’m going to talk about my parents in a little bit. Uh with my when my dad passed away in 2015, my mother was diagnosed with cancer weeks after my dad passed away. And uh then when she passed away about a year and 3 months after my father did um she updated some things, but she didn’t get to everything we found out. Uh but uh she did update her will. Um but the will opens up probate. So we’re going to talk about even if you have a will, you can still go through probate. So but it does put instructions in writing. So this is where you would put if you have jewelry, if you have artwork, if you have minor children, all your instructions, what you would like to have happen. Sometimes it’s even the emotional things that you could put in there um you know that uh of what your wishes are. Durable power uh power of attorney for healthcare. There are two documents for uh power of attorney. The first one this health care and the second one coming up is going to be for uh property or like accounts to have someone able to pay bills for you. They are separate documents but they are both important documents to have. The first one is the power of attorney for health care. Lets you designate someone to sign for you if you need a surgery to have the say so of um take the feeding tube out or don’t take the feeding tube out. Uh like the Terry Shyo case. So someone needs to be in charge of that and it needs to be in writing. [clears throat] Do not resuscitate. This is an example of actually my mother-in-law uh had a DNR. uh do not resuscitate where when uh she passed away, she uh you know cancer and you know all sorts of things going on with her body and she went into cardiac arrest and they did some measures but it was a do not resuscitate. They can only do so much according to the instructions on there and she did pass away. directs uh that resuscitative uh measures be withheld or withdrawn planning for incapacity for property. Now having joint owners could be very uh important to have but there comes with a little bit I don’t even want to use the word risk but when I explain joint ownership means that someone has access to your property. So, if you are a, let’s say, a single person and you have adult children and you want to put one or all of your adult children as joint owners on your accounts just in case, maybe they’re trustworthy children and you want to just have them joint on your account. So, uh, if you need if you’re in the hospital that someone can act on your behalf, they have power to, you know, sign on checks and things like that. Uh, great. One of the big butts on that is what if something happened with one of those joint people. Let’s say maybe it was an accident or [clears throat] maybe it was their fault, maybe something they got sued for something. Your assets are now in play if there happens to be some type of court case and payment and your assets could be at risk on something like that. So that is certainly it’s a it’s kind of a stretch but it’s certainly something that could happen. Why someone would want joint ownership uh maybe adult children and why someone would not want uh joint ownership. Verbal power of attorney. This is also the document that someone can pay bills for you and have access to your accounts. They’re not joint owners. They can only do things on your behalf. If they ever got sued, it’s not their asset. So there’s no risk on that part, but someone can help you pay your bills and do financial things for you um on your behalf. So they can just sign your name, POA, power of attorney, and then that that person’s name. Living trusts. So we’re going to talk about trust. Maybe it’s a revocable trust or an irrevocable trust. Just so you know, most trusts that people do, most family trusts or living trusts or whatever type of trust are typically revocable, meaning you control it. You might be your own trustee of your own trust and but it is a separate entity that owns your property. It’s out of your um your personal ownership. It is owned by the trust, but you would control the trust. What happens if you die without an estate plan? Some property passes automatically to a joint owner or or designated beneficiary. So all of those accounts that if you have a 401k and you have beneficiaries named, you don’t need to have that in a will, you don’t need to have that in a trust, nothing like that. you have beneficiaries named and if you passed away uh death certificate and the beneficiary has an ID and they can open up an account and inherit those uh funds um or take control of a savings account or just move it to their own savings. So it does pass seamlessly if you name beneficiaries. Same thing if it is a joint owner and you passed away the joint owner already owns the account. All other property generally passes according to state estate and testasy laws. Probate what happens if you die without an estate intestasy. They vary from state to state. So probate rules are very different. My mother and fathers uh which I’m going to talk about here. Uh typical pattern of distribution divides uh property between uh the spouse and the children. So here’s an example of if you don’t have something in writing. Maybe you had an individual account. If you have a spouse and you have children, maybe your wishes were to say, “I’m going to just, yeah, it’s my wife’s. I’m just going to leave this, of course, to my wife first so she can move on.” And uh but some state um laws might be that if you passed away, if a husband passed away in this case, the wife gets half and the kids split the half. Maybe that wasn’t your wishes, but that could happen in certain states. So, here’s an example of even a spousal situation. You definitely want to make sure that you either have a spouse as a beneficiary or joint on that those accounts. Your actual wishes are irre irrelevant. Uh when we talk about um intestasy, it’s up to a judge and there could certainly be uh potential problems there. Wills and probate. So here’s where my mom and dad’s uh situation. Uh my father passed away in 2015. Uh my mother was happened to be diagnosed with cancer 5 weeks after my dad passed away. So 2015 still and she was going through her health issues and kind of settling my you know father’s estate. She was the beneficiary on his retirement account. So that was all smooth uh seamless on that and he was joint on accounts. She took his name off of some of the accounts that we saw and everything was pretty smooth we thought and she went to the attorney to update her will to take you know 50% of hers to her my my father her husband and uh so it was just I’m one of five kids so everything 20% to five kids is what she put in the will. Uh, so she ends up passing away a year later and now we’re going to settle her estate. So we’re at the down in Florida, all five of us are spouses. We do the funeral and now we’re starting to settle things. We see an attorney about her condo um that she owned and then some some accounts she had. We had statements. We had her her IRA account. And so we’re talking to the attorney and the attorney is going through the pile. Oh, there’s no beneficiaries on this one. Uh, we’ll talk about that. Oh, this one has beneficiaries. Go ahead and you can close these out. Anything with beneficiaries, we were able to take care of immediately. There were some accounts that did not have beneficiaries. And same with her condo. So, her condo at the time was valued at about 220,000. And the two accounts or two or three accounts that totaled about 80,000 did not have beneficiaries named. So, we had a $300,000 estate. It doesn’t didn’t count the IRA or anything else that had beneficiaries. The estate for probate purposes are just the things that are still in play, uh, which is the condo and the 80,000 accounts. So, 300,000 estate goes into probate. Now, this is in the state of Florida. And now we’re at the mercy of just waiting. Uh now this is when when people say you know is a you know shouldn’t take too long. I mean it’s pretty smooth. Everything was in the will which she did update but it’s a six sevenmon period in Florida somewhere in that range. And uh what if someone comes forward? A will can be contested. Uh which means if someone says hey she said she was going to leave me some of that you know I I get some. Now, there’s got to be documentation and proof things like that, but it can it certainly delay or add extra costs and things like that. It certainly could. So, uh we ended up going through and it was 6 7 months later we finally uh the judge says, “Yep, everything’s fine. 20% for the 80,000.” Put the condo in the kids’ names, which we ended up selling uh the condo. So, that was all it was all fine after a while, but boy, what a waiting game. And [clears throat] the biggest part of that is the attorney costs us between $9 and $10,000 for that 6 to 7 months. So probate attorney, it’s not a cheap process. So this is one of those when people say if I talk to an attorney, if I have to open up a trust, if I do, it might cost a couple of thousand, but it’s not going to be 9 or 10,000 that it could cost your beneficiaries after the fact. So in the will in our case when you see in the middle one here names an executive u uh my sister as an example was the executive of the estate and the attorney actually looked at all five of us in this room. He’s like just so you know all five of you if you call me I can’t talk to you. I can only talk to the executive. So we all met periodically and so we ended up finally settling the estate um and getting those counts. What a waiting game and what an expensive waiting game that was. Wills and probate the process. Most wills must be probated. And just so you know the term when the do when the doctor when the attorney uh had said u that you know he has this will. It’s updated. We’re going through statements and things. He said the first thing I’m going to do um you know whatever the next day or within the next couple of days is I take this to the court and file it. Now it gets filed. That’s when probate begins. So in just having the will is not enough just to say everything goes to who you say. The will opens up probate. Uh so wills filed uh with the probate court. Executive collects assets. So we had to continue to pay the association. We had to pay the property taxes. We had to pay insurance on the home still and all the different things. We still had to pay all the bills and we had to make sure those funds were available. Typically process lasts several months to a year, which was pretty typical for our case. Again, I’m just going to throw a reminder that if you do have some questions, type away in the chat box or the Q&A, and I will get to those at the end of the presentation. Uh probate uh pros and cons. Uh time and cost could uh typically modest. Uh depends on uh what your attorney fees and things like that are um for uh for probate. Court supervision protects against creditors. If there are, you know, if there was credit card debt or anything or mortgage, thankfully my, you know, the condo was paid off. My mother did not have credit card debt. In fact, I think she bought something for about $200 around before she passed away that we had to pay $200 to the credit card. Uh, but if there are is debt, it is protected until probate ends. uh can be timeconuming for complex estates uh title transfer delays. There’s could be a lot of fees which we had paid and ancillary probate which means if there is let’s say properties in another state you’re not just dealing with probate in the state that you’re in like we were in the state of Florida that’s where my mother lived but let’s say she still owned a property here in Illinois she didn’t but just in case she did there could be ancillary probate in Illinois then so it’s where things could be especially if they’re not in a trust or something like that. Uh it is public record like I said. So um you’re you know it’s so that privacy if it is important get your estate plan wills and probate avoiding probate. Can it be avoided? Absolutely. Yes. Uh this is where we’re going to you know having beneficiaries named is there a trust needed? Uh all those different things. So, joint ownership, uh, complete beneficiary designations on IRA, 401ks, any other retirement plans, life insurance. Make sure you have your beneficiaries up to date on that. Uh, use a trust if you think you might need a trust, and we’re going to talk about that toward the end of the presentation. We’re going to dig a little bit more on that. But, uh, uh, creating a trust is certainly something to consider. uh could be it’s a little more cost than wills uh and wills and power of attorney documents. But there is also and I’m going to share a screen toward the end of this some online do-it-yourself sources for some of these. If you think you’re savvy that you can do this on your own, there are some outlets for that. Uh making lifetime gifts, you can start to give away money uh throughout uh your living years so you don’t have to wait until you pass away to give it. Uh, some people want to see their family enjoy it while they’re still here. Transfer taxes include federal gift tax. So, if you start to give money away, it could be taxed. There’s an exclusion for how much you can give without it being taxed. Estate tax is basically imposed on transfers made upon your death. So, gift tax is while you’re still alive. Giving money away, if you give too much away, it could be taxed. The estate tax is when you pass away is there could be an additional estate tax. Then there’s also an additional if you are separate uh for if you skip generations giving uh you know when you pass away [sighs] uh which is grandchildren, great grandchildren.
So the federal gift tax, lifetime transfer. So gift tax applies to transfers made during your life. You can give up to $19,000 a year uh individually to anyone or as many people as you would like. If you have five children and you want to gift each of them 19,000, you certainly can. If your five children are all married and have spouses, you can gift your son or daughter-in-law 19,000. So, you can give each family 38,000. And you could do that to every you can give to your grandchildren. You can give to anyone $19,000 a year without it being taxed. All of this totals up that you can give away up to $15 million whether still alive in combination of living and at death without it being taxed. Uh the 15 million exclusion is the largest. So it’s been it crept up over the years. There’s been years, many years where it was lower. Uh and uh of course uh now at 15 million, this is the highest it’s ever been. So the federal estate tax uh applies on transfers made at death. Generally does not apply to transfers made to spouse or a charity. So you can give to your spouse even if you have a healthy estate like this without it being taxed. 15 million uh excluded from all transfers, gifts and estates combined in 2026. All any portion or excuse me any portion of exclusion from uh used for gifts will be unavailable to the estate.
New feature important for married couples. It is portable. So if your estate it could be let’s say 15 million without go being uh through the estate tax but if your spouse has let’s say $15 million you can pass away you can gift $15 million to your spouse and then your spouse can gift 30 million. So your 15 million can kind of move forward to the spouse and when the spouse passes away up to 30 million can go um without being uh taxed on the estate tax. So this is the generation skipping tax where there’s an additional 15 million for this that if you gift directly to uh grandchildren or greatg grandandchildren skipping a generation. So here’s where the taxes are for the estate tax and it’s a flat 40%. Uh so it was 2024 13.6 13.9 now it’s at 15 million. Uh and it is so again if it is a $20 million estate and someone passes away the first 15 million is not taxed but the 5 million after that could be taxed at [clears throat] five uh at 40%. So this is how do we avoid things like that? You start to give away early if you can. Lifetime gifting allows you can do 19,000 uh to as many or as people as you would like. Uh it removes future appreciation of property from your taxable estate and no step up in basis. Here’s what that means. No step up in basis. So I’m going to use a step up example first. though, if someone owns a stock, let’s say they have a brokerage account and they have a stock and I’ve seen something like this. So, I’ll use like an old oil stock as an example. Someone bought an oil stock, you know, 50 years ago and they still have this stock. They bought it for, let’s say, $30,000 and it’s worth $200,000 now. And it’s just grown over the years. Now, there has been no tax on that gain until it’s actually sold. If that living person sold the stock, they would pay capital gains from the 30 up to the 200,000. So there would be hefty capital gains paid on that. Now, if that person passes away and someone inherits that stock, it steps up to the 200,000. Let’s say on day of death, that value was 200,000. If the beneficiary of that sold it immediately for 200,000, there’s no taxes paid, no uh capital gains because there is a step up on that. If you start to gift while you’re still alive, if you have to liquidate any assets, stocks or anything like that to gift, it could be a taxable event to you. Just so you know, there’s no step up on that. Uh step uh that’s only upon death. Lifetime gifting transfer uh transfers excluded from the gift tax. Uh so 19,000 if you are married, you and a spouse can each give 19,000. So a couple could gift each person 38,000. If you are contributing to a 529 college savings plan uh for someone, you can give 95,000 or 190,000 if you are married filing joint uh tax-free. So, you can gift directly to a college savings plan. There’s no gift tax if you pay someone’s tuition, but you have to pay the education uh the college or whatever it is. You have to pay it directly. You can’t gift it to someone to pay tuition. You have to directly pay the uh tuition. And there’s uh so you can do that without it being taxed. And same thing for medical care. If you are paying someone’s medical bills, if you are able to, as long as it is not taxed, if you pay the medical provider directly, again, you cannot gift it to someone to pay the bills. You have to pay the bills directly for them. Trusts. So, let’s dig into trusts a little bit. So versatile estate planning tool can protect against incapacity, avoid probate, minimizes taxes, professional management of assets, provide safeguards for minor children, elderly parents, can protect assets from future creditors, and control over property. Here’s what a trust is. A trust is basically it’s a separate entity. Uh it’s almost like if you had a business and you had a business, you know, uh savings or checking account for the business. Those are away from personally if you had a corporation. Uh if I was Joe and I had Joe’s garage because I’m a mechanic. Um and I have Joe’s personal accounts and I have Joe’s garage uh you know uh accounts separate from myself. I don’t own that. The business owns it, but I control the business. Same thing with a trust. You’re creating a separate entity to own assets. you’re creating this trust and the biggest thing is let’s say for example you create a trust you put the home in the trust and if you pass away you’re going to name what’s called a successor trustee to take over that’s sometimes why they call it a living trust if people die the trust can keep on going someone else just controls it does not go through probate uh this is a a big way how do we things that don’t have a beneficiary maybe when you bought your home there probably was not a beneficiary form. Some states, there’s I think about 11 or 12 states that you can do beneficiary forms. Go to your county, check with your state or county to see if you can do a beneficiary form for your house um to avoid maybe creating a trust or something like that, but that is certainly a possibility. So creating a trust basically takes the assets out of your personal estate and you’re creating this separate entity to own the assets. Uh so parties to a trust there’s a grtor. A grtor is the per is the person who creates this entity creates the trust. Um and you’re going to have a trustee that’s the person who controls it. Now many times the same person is the grtor and the trustee or grtors and co-rustees. So if a husband and wife create a family trust uh and they have assets in there, they put the house in there, they were probably the grtors that created it and they are probably the co-rustees controlling it. So they can be the same person. And then you would name beneficiaries in the trust. So, if you have all of these and if you have some complicated things, some examples of some of those are if you have a special needs person that is in your care. Uh here’s an example of someone that I’ve uh spoken to in the past. I was working with them and they said, “Yeah, we have this trust. We have a special needs person. It’s not our child, but it’s a relative and lives in our home and we actually have it in the trust.” the home was in the trust and it said if we passed away and the special needs person is still alive, the trustee cannot sell this home. This special needs person will always have a home. So those are some of those things that you can put in a trust that are not normally in a will or in your wishes. Another example is uh I’ve had someone said I have three three children. Two of them are very responsible and one is not responsible at all. And if this not responsible child inherits what we have, a third of what we have, it’s going to be gone in, you know, very quickly. So we have it in the trust that the trustee will distribute this p this child assets at a certain age and then when they get to a certain other age, they get more and then another age they get more and it’s spread out. The good is that you can control that from the grave. The bad is this trust has to keep on going and someone has to manage that and there could be fees, cost, expenses and things like that. But some of these things are you are certainly able to do. Uh trusts that are revokable or irrevocable uh comes into play. A revocable is your typical trust like I was just saying is you can change the beneficiaries. You can do whatever you need to do. When you have a an irrevocable trust, you do not control. This is what someone might do if they have extreme wealth and they need to distance themsel from these assets that would be subject to the 40% estate tax. That’s why someone might have an irrevocable trust. it takes it completely out of their estate and it would not be subject to the 40%. So there’s certainly ways talk to your attorney if you are in that uh uh situation you would definitely want to create that type of an estate plan. Life insurance can provide an instant estate. What that means is that even if you have no assets, if you don’t own a home, you don’t have assets, but you have a life insurance policy that you want to leave to someone that is create that’s part of your estate even though you have no other assets. So, a life insurance col uh policy can [clears throat] it can provide an instant estate uh can provide uh needed estate liquidity. Sometimes some people will say, you know, we can pay for the funeral based on life insurance proceeds to come very soon. Uh life insurance proceeds are included in the estate tax. So if you have a million dollar life insurance policy and you have 15 million other dollars that would have not been taxed because that’s at that cap, that million could be taxed at 40%. even life insurance is part of that 15 million estate. Key issue is ownership of the policy. Here’s where we’ll talk a little bit about irrevocable trusts. And this is going to be wrapping up fairly soon here. So again, I’ll just remind if you do have some questions, I will take these at the end. And we’re we’re getting there here soon. Uh life insurance and an irrevocable life insurance trust. Uh basically if you are in the situation where you have extreme wealth and you need to get fund money out of your estate or even have life insurance outside of your estate, you would have an irrevocable uh trust. In this case, a life insurance trust. So you are the insured. You have this irrevocable trust that’s going to hold this insurance policy and your family is your beneficiary. So you create the irrevocable trust and you name someone else as a trustee. You cannot be your own trustee on an irrevocable trust. Someone else has to manage that. Uh and you’re naming the beneficiaries as well. So trustee purchases uh the life insurance policy and it which is owned by the trust. So the trustee that you named uh purchases this policy, you can make cash gifts to the trustee to the trust to pay the premiums for that and beneficiaries technically can withdraw cash gifts. Uh so some of that cash value in that type of a policy might be available. Um but uh the whole purpose is uh trustee uses the cash to pay the premiums for the life insurance. And this again, this irrevocable life insurance trust is outside of your $15 million estate. So this is how some people can avoid paying the 40% is creating entities or trusts outside of your estate. So at death, the insurance company um pays the irrevocable trust which pays the beneficiaries uh and are not subject to the estate tax because again it’s outside of your estate. Proceeds distributed according to the terms of the trust and the beneficiaries receive the full proceeds fee free uh from estate tax and even income tax. So in conclusion, have you implemented a plan for incapacity uh health and property? Do you have a valid will? Are transfer taxes a planning concern for you? Does your overall estate plan reflect your current wishes and circumstances? So here is a there here’s an outside source. Um, now this is not something that we, you know, we’re not I’m not referring, but this is just an example of it’s a website you can go Trust and Will. You can even type in trust and will and you’ll find this website where it’s kind of a do-it-yourself. If you are savvy and you want to at least check this out to see, can I create my own, there’s templates and things and there’s some online sources. It’s not free. you will pay in the I’ll call it the hundreds of dollars instead of the potential thousands of dollars where if you create a will, trust, powers of attorney. Um so it’s a much less cost but there are there are certainly some online sources. Um I had a spec uh an attorney that I used when I lived in Roselle, Illinois. I’m in a suburb of Illinois and at our previous house, we had an attorney who has since retired, but I do have some other attorneys local in this area that I can certainly refer if you would like to speak to an attorney about some of these things about opening up a will, trust, powers of attorney, all of these important documents. But again, this is just a source where you can look and see if this is something that you want to do on your own or you could certainly uh you know, you and I could speak and as I go through the questions here in just a moment, you have a you see a QR code on the screen there if you would like to set up a one-on-one conversation with me just to say, “All right, I just want to see what I should be doing. Can we just look at my stuff and see if do I need a will? Do I need a trust? Do I need the powers of attorney?” and you know those types of things. You and I can have this one-on-one conversation. Uh you can put your camera up to the QR code. You click on the yellow thing that comes up there and you’ll have access to my calendar. You can schedule a time right now if you wanted to or I’m going to put up the survey here in just a moment. It says set an appointment with Joe if you want to say yes. we can you and I will set up a time to speak and whether that’s a phone call or Zoom or if you’re local here uh where I my office is over by O’Hare airport we could even meet face to face. So I’m going to put up the survey here right now. So the survey is there hopefully you see that on your screen and you can just click on that to hopefully respond to that and then I will go through the questions here. So, uh, the first one is, can you recommend an attorney, uh, that can help with the trust and wills? Yes, I certainly can. I have your information here. Uh, I hope you’re one of the yeses on there that we can certainly talk about it and see if, uh, um, you know, what attorney I could certainly recommend for you. Uh, can you have two executives in a will or a trust? You can. Uh, so let’s say a trust. Um, you are what is called the trustee. If you are married, you could be co-rustees. Let’s say you have two children and you want to have one of them control the estate. You can have a successor trustee, one child. Or you could have successor trustees 50/50. They both have to control it. Co-rustees. So co-successor trustees. Same thing with executives. Yes, you can certainly do that. uh for our family when we had five kids when my mom passed away uh one executive sometimes uh I’ll be see especially if you have multiple people and you have two let’s say two of if you have three children and you name two of them as an executive uh that could uh cause a couple of uh issues there but you certainly can uh so if a single person has property how do I ensure that my property gets passed to my heirs will and trust is certainly at least beneficiaries. That’s where I always start is name beneficiaries on your accounts and that’s your savings checking, life insurance, uh IRA, 401k, anything that you can has an account number, you can add beneficiaries. Do that first. Then it’s the other things. What if the car uh you might have a car that could be an estate issue if if it’s just in your name and uh who’s going to get the car you know someone might there might be people fighting over that will maybe you can even put the car in the trust you could put your home in the trust and your wishes are carried out by the successor trustee. So, if you are a single person and you have some property, number one, name beneficiaries on the accounts, things with account numbers. If you’re uh if you know, if I could see what state you’re in, if we do have a conversation, we could see if there’s that beneficiary form for your home. Um, and then anything else would be wills and trusts, especially if you have jewelry, artwork, anything that’s hanging on the wall or wherever it might be, your wishes need to be documented. That would be in the will. Uh, can you recommend an entire already did that one? Is there a way to avoid the 40% tax on money from the sale of the deceased person’s property that goes into the trust at the time of sale. So, if we’re talking of of an estate, the 40% is only above 15 million. Um, if things are not in place, uh, there’s I I used to do a presentation and it talked about James Gandalfini, if you remember James Gandalfini from The Sopranos and other things. He had a sudden heart attack and passed away in his 50s and he had I think they estimated it was about a $70 million estate that he had no estate plan. Uh, so you got to do it while so after someone passes away, if it’s an estate over 15 million, it’s going to be subject to the estate tax. You need to take care of it before someone passes away to the irrevocable life insurance trust or speak to an attorney on getting assets outside of your estate to get under that 15 million to not be subject to the estate tax. So, if if someone has over 15 million and they’ve already passed away, it’s kind of too late. Uh could we see the replay possibly? Unfortunately, I did say at the beginning uh I am not able to uh get the uh recording of this or I’m not able to give the deck out or the slides out um you know for compliance purposes. Uh let’s see, there’s some more here. Uh, will you be able to get the copy of the slides? Unfortunately, no. Are you able to recommend an attorney or lawyer in Texas? I do not have one, but I can certainly help maybe help you find something of a trusted. Maybe I can even check with clients. I have some clients in Texas um in the Dallas um to see if they maybe have an attorney or something. So I always have some sources to go through but I don’t have I just in the Chicago area here where I can certainly recommend someone uh if I have my home uh as an asset of my revocable trust does the value of the capital gains uh purposes reset the day? Yes. Even if it’s in a trust there is a stepped up cost basis on your home even if it’s in a trust. Uh so yes you are protected on that. Yes. Uh even uh hello. Even if the life insurance policy has a beneficiary, it has to be included in the trust. Not necessarily. As if it’s owned by you personally and you have beneficiaries named, it does not need to be in the trust. You can have the trust own it, but you don’t have to do that. You can just have it owned by you. And as long as you name beneficiary, now it’s outside of the trust. If you have different beneficiaries in the trust, I’ve seen this too, that someone might have their children as beneficiaries in their trust, but they have another nephew or niece that’s near and dear to them, and they have this separate account that they have that nephew or niece as the separate beneficiary. It’s outside of the trust. The trust has nothing to do with that account. And so, that account would definitely just go to that individual person. So that’s one of those things. Maybe this life insurance you don’t want in the trust because you want a separate beneficiary. So your life insurance does not need to be in the trust. Uh can a person be a trustee and also be listed as a beneficiary? Yes. Uh I’ll say a successor trustee maybe not necessarily the trustee because if I have my own assets and I’m the trustee of my own trust, I’m not going to be my own beneficiary. But if I name one of my kids as the successor bene uh trustee. So my one of my kids is the successor trustee. I pass away the successor trustee. My daughter let’s say controls the trust but she can also be a beneficiary. She uses the trusted person that I put in there to control to do that. So, um I would say successor trustee can also be the beneficiary, but most likely the trustee is whose assets they are. However, there’s maybe someone else created a trust on my behalf. Um and maybe they’re a beneficiary. So, it’s possible, but there could be a conflict of interest on there. I would say if you have a complicated issue like that, speak to an attorney about that if there’s some certain examples of that. Let’s see if anything else came through. We are I think that is all of the questions that I have. I’ll just wait a minute and see if anything else came through. I think that is it. Thank you all so much for your time and attention tonight. I hope uh you and I are going to have a one-on-one conversation here soon. Thank you. Have a great rest of the evening.