If philanthropy is an important part of your life, then you should consider making it an important part of your estate plan as well. Your estate plan allows you to provide for your family and loved ones in the event of your death. That same plan can allow you to provide for the causes that are important to you long after your death as well. Only a lengthy consultation with your estate planning attorney can determine how best to incorporate your charities into your estate plan; however, there are some universal key points about charitable giving that are important to understand.

You may choose to provide a direct gift through your Last Will and Testament to the charity of your choice; however, a trust frequently offers probate and tax advantages that a direct bequest does not as well as more flexibility than a direct gift.

A charitable trust can be either a living trust or a testamentary trust.

If you establish a living trust, and distributions are to be made while you are still alive, then the trust will typically need to be an irrevocable trust.

The most common charitable trusts fall into one of two main categories — lead and remainder trusts

A Charitable lead trust provides income to a trust for a specific period of time and then gives the remainder to non-charitable beneficiaries, such as family members.

A charitable remainder trust provides income to non-charitable beneficiaries, such as family members, for a specific period of time, or life, and then gives the remainder to a charity.

A portion of the value of assets used to fund the trust may qualify as a current deduction for income tax purposes.

The amount that passes to a charity may qualify for an estate tax deduction upon your death, decreasing estate tax exposure.

You may be able to avoid paying capital gains taxes on assets that are used to fund a charitable trust.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

The world suffered the loss of singer, actress and producer Whitney Houston at the age of 48 last month when she was found dead of unknown caused in her Beverly Hills hotel room. While fans responded by rushing to buy her work, her family braced itself for the possibility of a battle over control of Houston’s estate. Some of the fear of an impending battle over control of Houston’s fortune were quelled this week when it was revealed that Houston left behind a trust naming 18 year old daughter Bobbi Kristina as beneficiary.

Bobbi Kristina is the child of Houston and her former husband, singer Bobby Brown, and is Houston’s only child. Bobbi was expected to inherit most, if not all, of Houston’s estate. Leaving a fortune to any 18 year old is generally not a good idea; however, it was of particular concern in this case as rumors are that Bobbi Kristina suffers from some of the same drug and alcohol problems that plagued her mother for the last half of her life. Adding to that, Houston and Brown had a tumultuous relationship that ended in divorce in 2007. Houston’s family was reportedly concerned that Brown would attempt to gain control over Houston’s fortune by seeking conservatorship over their daughter.

With the news that Houston left behind a trust, concerns over who will control her fortune can be largely put to rest. Houston did, indeed, leave her entire estate to Bobbi Kristina; however, by creating a trust, Houston was able to appoint someone she trusted as the trustee who will manage the trust assets until Bobbi Kristina is older and better able to handle them herself.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

Nebraska has recently introduced legislation that may be the first of its kind in the country aimed at allowing the executor of an estate access to social media accounts of a decedent. If passed, the legislation will give the executor of an estate the right to access and control accounts for sites such as Facebook or Twitter, as well as e-mail accounts and micro-blogs, that were held by the decedent.

At the present time, what happens to a social media account when a person dies is largely up to the policy of the site administrators. Facebook, for example, creates a memorial tribute on the account holder’s page when notified by family members of the death of the account holder. According to the Facebook policy, “friends” of the deceased may continue to post comments on the decedent’s wall, but no one can log-on to the account, post status updates, or make any other changes to the account. If the Nebraska legislation passes, the executor of the decedent’s estate will be allowed to do so in the future. The same concept applies to other social media, e-mail and micro-blog accounts.

The proposed legislation highlights how the concept of “assets” has drastically changed in lieu of the increased reliance on digital media and communication. As technology changes, changes are required to keep up. Most of us would not have even considered the need to include plans for e-mail accounts or social media accounts in our estate plan ten years ago; however, as the proposed legislation points out, we may all wish to do so now.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

With the death of singer and actress Whitney Houston last week, sales of anything related to the performer immediately began to soar. Unfortunately, as is often the case when a substantial estate is involved, signs of trouble surrounding Houston’s fortune began shortly after her death as well.

Once considered unstoppable in her professional career, Houston’s personal life seemed plagued with troubles from the time her professional career began to skyrocket. Houston’s tumultuous relationship with singer Bobby Brown finally ended in divorce in 2007; however, that may not be the end of the battle between Houston and Brown. The couple had only one child — 18 year old Bobbi Kristina — who stands to inherit most, if not all, of Houston’s estate.  While Bobbi Kristina is old enough to inherit from Houston’s estate directly, we may see a battle over who will be appointed as Bobbi’s conservator, and have control over her inheritance.

Reports are that Houston’s family was reluctant to invite Brown to the funeral based on fears that he would make an attempt to get close to Bobbi Kristina as a way to eventually control any inheritance left to her by her mother. It is believed that Houston did leave behind a Last Will and Testament; however, that alone may not be sufficient in the absence of a trust to determine who will ultimately control the assets left to Bobbi Kristina.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

When people start looking for information about making their own will, they are often bombarded by internet offers that claim you can make your own will cheaply, easily and quickly. While some of these offers are legitimate, they are no substitute for the expertise and experience of a qualified attorney.  Though an online will may be legally valid, that doesn’t mean it is the best document suited to your needs and your particular situation.

All states have very specific laws that govern what has to be included in your last will and testament for it to be legally valid. Most of these laws are quite simple and only require you to meet a few basic hurdles, such as being of age, mentally competent and having your will witnessed by two adults. However, there are many other factors that go into creating a will that, even though not required by law, will ensure that you are able to pass on as much property to your heirs as possible.

When considering an online legal document company or will provider, it’s important to note that these companies may not be reliable or completely up-to-date with changes in the law. Also, online document preparers cannot give you legal advice about what decisions to make when creating your will or whether doing so is in your best interests. You may, for example, be much better off by first creating a trust to which you can transfer ownership of all of your property.

Online will preparation services or will creation software may seem like it is a great idea because it offers a cheap and easy solution, but it will never be able to take the place of a skilled attorney who can carefully evaluate your estate planning situation. Even if you do choose to go with an online option, always have an attorney review the document. You may be surprised at what you missed.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

Powers of attorney are legal documents you can create to give other people the ability to make legally binding decisions on your behalf. There are a wide variety of powers of attorney available for you to use, differing by the powers granted, the time when the powers take effect and how long the powers last. Power of attorney laws differ significantly between states, so it’s always best to talk to a lawyer if you want to create, grant or receive any power of attorney.

Powers of attorney can take effect immediately or at a later time. A power of attorney that takes place at some later time is known as a springing power. These powers only take effect if a specific condition takes place. For example, you can create a springing power of attorney that takes effect only if you become hospitalized or one that takes effect on a specific date.

Powers of attorney also differ based on when they terminate. A power of attorney typically ends when the principal, the person granting the power, becomes unable to make decisions. This is known as losing capacity. A principal who, for example, is injured in an accident and becomes comatose automatically revokes all powers of attorney. However, if the principal granted a durable power of attorney, those powers do not terminate when the principal loses capacity.

It is up to the principal to determine what kind of powers to grant with a power of attorney. Often, however, principals choose to grant one of two kinds of powers: financial and healthcare. A financial power of attorney allows the person receiving the power, known as an agent, to make financial decisions on the principal’s behalf, while a healthcare power of attorney allows the agent to make medical decisions.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

To those who have no experience with estate planning, some of the terms used can make the process seem like it’s written in a foreign language. Though unfamiliar, most of these terms are not difficult to understand. However, some terms are interchangeable and may have slightly different meanings depending on how they are used or the state in which you live. Talk to an attorney if you have specific questions about the any estate planning terminology.

Estate: If you take everything you own and lump it all together, this is your estate. Some people confuse the term estate to mean a large home or property. While this version of the word is sometimes used to describe such properties, in estate planning circles the term is more generally used to refer to all a person’s property.

Testator:  The term  “testator” is often used to refer to both males and females who create a Last Will and Testament , much in the same way “actor” is used to refer to both male and female performers.

Holographic Will: A holographic will has nothing to do with a hologram or an image. It is a kind of will in which the testator creates the will entirely in his own handwriting. Unlike other wills, testators do not have to have a holographic will witnessed by others in order for it to be legal.

Intestacy: If a person dies without a will, that person is said to have died intestate. Intestacy is the condition of an estate that is not covered by a will. To resolve who receives the estate property, each state has intestacy laws that apply in this situation.

Executor: When you create a will, you typically nominate a person who will actually redistribute property after you die. This person is known as an executor, if male, and an executrix, if female. Some states may use executor as a gender-neutral term, though the position may also be referred to as an estate administrator or personal representative.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

What a lot of people don’t realize about the new tax relief bill is that it is going to sunset or expire at the end of 2012. If this takes place without any new legislation being enacted, the estate tax exclusion is going to be reduced down to just $1 million, and the rate of the tax will return to the 2001 level of which could be as high as 55%. So, unless you’re certain that you are going to be passing away before the end of 2012 your estate is vulnerable if it is worth more than $1 million.

There are a number of ways to reduce the taxable value of your estate, and the optimal course of action is going to vary depending on the exact anatomy of your assets and the nature of your wishes. However, one approach that will work for everyone at least in part is to give tax-free gifts while you are still alive. The estate and gift tax are unified, so any portion of the $5 million exclusion that you use giving gifts will be deducted from your available estate tax exclusion. But, there are some additional gift tax exemptions that can be used that do not impact the unified lifetime exclusion.

Each person may give annual gifts totaling as much as $13,000 to an unlimited number of recipients free of the gift tax. In addition, you can pay the medical bills and tuition  for loved ones and free of gift taxation.

If you utilize these gift tax exemptions creatively and consistently you can reduce the taxable value of your estate while passing along funds in a tax-free manner to those who would otherwise be inheriting them after you pass away.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

Many people believe that estate planning is not something that you have to concern yourself with until you reach the latter stages of your life. While it is true that the average life expectancy in the United States at this time is just over 78 years, this does not mean that you should wait until you reach the age of 75 to start planning your estate. There are no guarantees and each day we hear about people who pass away in accidents unexpectedly, and when you don’t plan ahead it is your family members who will pay the price.

The reality is that you should have an estate plan in place as soon as you become a responsible adult in your own right, and when you get married it becomes even more important. Most married people develop a lifestyle based on two incomes, and if one of these was to suddenly disappear it could severely impact the surviving spouse. Many people will have  life insurance to protect the other spouse in this event.  In addition, in the event of incapacity advance health care directives are a wise choice.

We would all like to think that our marriages will last forever when we are walking down the aisle, but the reality is that divorce is all too common these days. It is important to remember that estate planning is an ongoing process and your estate plan is going to have to be revisited when your life changes.  Divorce is one of these events, and you will inevitably have to make some adjustments to your estate plan should your marriage come to an end. Statistics vary, but it is safe to say that somewhere between 40% and 50% of marriages end in divorce.

Additionally, should you get remarried, you will once again have to revise your estate plan to reflect your new situation.

It is a good idea to develop a working relationship with an estate planning attorney that you feel comfortable with and recognize the fact that you will have to review and revise your estate plan on an ongoing basis as the years pass.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

We have all heard of the term “legalese” and there are indeed a lot of arcane terms that are used in the legal profession.  This is true in the specialty of estate planning as well. Though there are some that can be confusing not because they are lengthy but because they  include words that perhaps have meanings different than those same words in our daily life.

For example, many Estate Plans include both a Living Trust and a Living Will. And many Estate PLans use a Last Will to state your wishes for distribution of assets upon death.  Since the Last Will is a vehicle of asset transfer, there are those who assume that the Living Will is also used to transfer assets but the transfer must somehow take place while you are still alive.

This is understandable logic but in fact the Living Will does not transfer assets. It is used to state your medical preferences, usually centering around the issue of whether or not you would want to be kept alive though the use of artificial life support systems if you were in a terminal condition.

A Living Trust used is used to manage your assets while you are alive and  transfer assets upon your death. You fund the trust and name yourself (or you and your spouse) as both the trustees (managers) and beneficiaries so you have total control of the assets while you are alive. But you also name a successor trustee who will administer the trust in the event of your incapacitation and provide distributions to your beneficiaries in accordance with your wishes after you pass away .

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.