How Do I Make Charitable Giving Part of My Estate Plan?

xIs there a charity or a cause that really speaks to your heart? Do you want to make a difference in the world even after you are gone? If so, you may be wondering how to put your charitable giving desires into effect with your estate plan. This article will give you ideas of how to accomplish charitable giving and where to start. For more information on estate planning.

 

Make an outright bequest.

  • This is probably the easiest method for supporting causes you love through your estate plan. 
  • Typically, this method would involve identifying and exact amount to give to a specific charity and specifying that in your will. 

 

Donations in lieu of flowers when you die.

  • You can ask friends and family to leave a gift to a certain foundation in lieu of flowers when you die. 
  • This can be a good way to not only fund-raise for your favorite charity, but also to bring awareness and public support for the charity also. 

 

Name beneficiaries for non-probate assets. 

  • Assets that do not go through probate include assets held in trust, life insurance policy payouts, and retirement accounts and pensions  
  • You can name the beneficiary on these accounts as the charity or charities that you want to support. 
  • As a note of caution on this one, though, your loved ones may want to inherit these types of assets because tax benefits may be involved.

 

Can I remain anonymous in my charitable giving?

  • Prior to 2021, California had a law requiring nonprofits to file a list of their large donors with the state. The U.S. Supreme Court in a 2021 decision struck down California’s law, thus siding with donors who may have a desire to remain anonymous. Consult the Law Office of David Knecht

 

At the  Law Office of David Knecht, we have extensive experience with estate planning and can help you accomplish charitable giving or a plan that accomplishes the purposes you have in mind. We will perform a one-on-one evaluation to help you create an estate plan that is customized for your needs. Call us at 707-451-4502.

 

Imputation of Income for Child Support and Alimony in a California Divorce

A common issue in child support and alimony cases in a California divorce is imputation of income. This article will explain the concept of imputation of income and provide an overview of some of the basics in this area of divorce law. For a deep read on these issues, go to this article, “Kids, Custody and Alimony” from the Journal of Contemporary Legal Issues.

When does imputation of income typically become an issue?

  • In child support or alimony cases
  • When one spouse claims that the other refuses to work or is underemployed. 
  • The court has discretion to assign an income to that person consistent with their earning capacity, ability and income earning opportunities

Does imputation only apply to employment? 

  • No, the imputation can also relate to assets. 
  • The court can also look at income producing assets and impute a reasonable rate of return to historically non-income producing investment assets.
  • For example, if money is in the bank and not earning any interest, a family law judge does have discretion to assign a reasonable rate of return to that investment. 

Is the imputed income added to the actual income?

  • Typically the imputed income is not in addition to the actual income but in lieu of the actual income when it comes to employment.
  • However the judge does have discretion to add the imputed income from assets to imputed income from employment.  

Is there a case that can help me understand how imputation works in a divorce case?

  • An interesting case from the California Court of Appeals 2001, In Re Marriage of Cheriton,  involving imputation of income from employment and investments can be found here:  

Consult the Law Office of David Knecht

Cases that involve imputation of income from employment or assets can be complex. If you need help with child support, alimony or any other issue in a California divorce, please contact us at the  Law Office of David Knecht. We have extensive experience with estate planning and can create a customized and effective estate plan just for you. Call us at 707-451-4502.

Property and Debt Division in a California Divorce

In a California divorce, even if the parties agree, a judge has to approve the division of property and debts through an order. You don’t necessarily have to go to court because a judge could approve an agreement between you and your spouse. If the parties don’t agree, the judge can make a determination for you at a hearing or a trial. Information in this article will help you better understand https://selfhelp.courts.ca.gov/divorce/property-debtsproperty and debt division in a California divorce with information sourced from online resources provided atx. 

 

  • What is property? 

 

  • Property has a formal definition, but in general it is anything that you can own, buy or sell. This includes real estate, bank accounts, life insurance, retirement and more. 

 

 

  • What are the categories of property and debts?

 

  • Community property is generally what you own together during your marriage and the debts that you owe together during your marriage. 

 

  • Separate property is generally what you each owned individually before you were married or after you separated and any gifts or inheritance or any debts you incurred before or after your marriage. 

 

 

  • Why is the date of separation important for categorizing assets and debts?

 

  • The date of separation is important because generally, from that day forward, what you or your spouse earned or loans that you take out are no longer community property. 

 

 

  •  What are the rules for the date of separation?

 

  • The separation date is the day that one of you let the other one know (by actions or words) that they wanted to end the marriage, provided that after that day, your or their actions were consistent with wanting the marriage to be over. 

 

 

  •  How can I tell if something is community property?
  • Generally, community property is anything you earned while married, anything you bought while married and debt that you incurred while married. 

 

Consult the Law Office of David Knecht

Property and debt division is one of the most important aspects of a divorce for most people. The information in this article is very general, but an experienced family law attorney can help you make your case to get the property to which you are entitled and fight to prevent your being saddled with debt that isn’t yours. Please contact us at the  Law Office of David Knecht. We have extensive experience with divorce and family law issues and can answer your questions. Call us at 707-451-4502.

 

Inheritance, Estate Planning and Charitable Giving: 4 Strategies to Reduce Taxes Now

MarketWatch recently published a great opinion piece entitled “Inheritance, estate planning and charitable giving: 4 strategies to reduce taxes now.” This article summarizes the strategies share in the article, but the full text can be found at this link:  

 

  • Offsetting Capital Gains

 

  • Capital gains are profit you make from selling an asset that has appreciated since you first obtained it.
  • These gains are taxed.
  • If you hold the asset more than a year, they are taxed at a rate lower than ordinary income. 
  • Losses on your assets can help reduce tax liability. 
  • Take away:  Do not wait to look strategically at how to harvest tax losses to offset gains until the end of the year. Engage in proactive review of your stocks throughout the year to evaluate the best course of action and to see if there are ways to take advantage of market volatility during times of decline.

 

 

  • Evaluating Roth Conversions

 

  • A Roth IRA conversion changes when the taxes are due and Roth IRA conversions are becoming increasingly popular. 
  • With a tradition al 401(k) or traditional IRA, the taxes are paid on the back end when you withdraw the money. 
  • With a Roth IRA conversion, you owe taxes on the amount you convert up front, which is difficult, but then the converted amount is able to grow tax free and you do not pay taxes at the time of withdrawals. 
  • Example from the MarketWatch article:  A client had 1 million dollars in a traditional IRA. She converted it to a Roth IRA, which required her to pay $500,000 in taxes on the front end instead of paying taxes when she taxes a distribution or when her beneficiaries inherit the account. But now, the 1 million in the Roth can grow tax free, which is an asset she can lean on during retirement of pass on to heirs. (Noe, a Roth IRA must be open for five years and the individual must be at least 591/2 years old to take the money out tax free). 
  • Take away:  Evaluate what taxes you can afford to pay up front and determine whether a Roth Conversion makes sense for your goals for retirement or for your goals for your heirs. 

 

 

  • Maximizing Charitable Giving

 

  • There are many ways for clients to be charitable and use new tools for tax exemptions.
  • “DAF” – Donor Advised Funds are third-party funds that are created for the purposes of giving to charity.
  • “RMD”-Your required minimum distribution, “RMD”  is the minimum amount you must withdraw from your Traditional IRA each year. You can give this to charity and reap tax benefits. 
  • Take away:  Consider how charitable giving can accomplish your altruistic objectives while taking advantage of tax exemptions.  

 

 

  •  “Giving While Living” to Family and Friends

 

  • Giving while living is a popular estate planning tool.
  • You can give up to $16,000 to any other person, that money is not taxed, and the person who receives it gets the full amount of the gift
  • Take away:  Giving to family and friends while you are alive is a way to enjoy estate planning while you are around to see the joy that your gift brings to your loved one. 

Consult the Law Office of David Knecht

Connecting with professionals who understand tax saving tools, who can explain the options to you, and who can create the right plan for your needs and goals is essential for effective estate planning.  Property and debt division is one of the most important aspects of a divorce for most people. Please contact us at the  Law Office of David Knecht. We have extensive experience with estate planning and can create a customized and effective estate plan just for you. Call us at 707-451-4502.

If the Market is Down, is it the Right Time for a Roth Conversion?

A Roth conversion is a tool for transferring money from one investment tool into a Roth IRA. When the stock market is down, investors can consider whether the conversion makes sense for their tax planning, investment goals, and estate planning needs. This article is not intended to provide legal or financial advice, but will summarize information published online which may assist you in working with your legal or financial advising professional to create a plan that is right for you. 

 

  • What is a Roth conversion?

 

Why might a Roth conversion be appealing when my stock portfolio is down?

  • With a Roth conversion, the account owner has to pay income tax on the money they convert. 
  • If your stock is down, the amount calculated for income tax will be lower. 
  • For example, if you purchased stocks for $100,000, but now they are only worth $75,000, then a Roth conversion at that time would only involve income tax on the $75,000 amount. 

 

 Why might a Roth conversion be appealing for estate planning in California purposes?

  • The Roth IRA conversion is a strategy to pass IRA assets to non-spousal beneficiaries either directly or as continent beneficiaries upon the death of a surviving spouse. 
  • It is a way to prepay taxes for the beneficiaries. 
  • For more discussion about this strategy, consult these resources:

 

Where can I find information on the other pros and cons of a Roth conversion?

 

 

 

 

Consult the Law Office of David Knecht

At the  Law Office of David Knecht,, we have extensive experience with estate planning and can help you understand and evaluate the various tools for effectuating your wishes and efficiently preparing for the transfer of your estate. We will perform a one-on-one evaluation to help you create an estate plan that is customized for your needs. Call us at 707-451-4502.

 

Avoiding Living Trust Mills: A Warning from the Office of the Attorney General for California

The State of California Department of Justice provides information to consumers on estate planning scams on its website:  https://oag.ca.gov/consumers/general/living_trust_mills

This article will summarize the information published by the Attorney General on this website about how to identify and avoid estate planning fraud. Although in depth information will be provided below, one good way to avoid fraud is to only do business with reputable estate planning service providers. At the Law Office of David Knecht, all attorneys are licensed by the State Bar of California. We have extensive experience with estate planning and you can trust us to provide honest and accurate information. Contact us at 707-451-4502.

 

  •  What is a living trust?
  • A living trust is an estate planning tool that allows you to control your money and property during life and then have it distributed to your desired recipients (people or organization), when you pass away. 

 

 

 

  • Why do you need to be careful in choosing someone to help you create a living trust?

 

  • Estate planning involves important legal, financial and personal decision-making. If estate planning documents are not properly created and executed, the consequences may be that your wishes are not properly followed or there may be tax or other unintended consequences.

 

 

  • What should you look for in filtering through choices of estate planning professionals?

 

  • Confirm whether the person who claims to be licensed actually is licensed.
  • Obtain identification from the professional you are working with to confirm that they are who they profess to be. 
  • Be wary of any professional who is pushing selling you one single product rather than helping you consider a variety of options. 
  • Watch for scare tactics to try to motivate you to jump into something without a lot of time and thought. 
  • Look for someone who is trying to sell annuities as well as trusts. Seniors can find themselves trapped in an annuity that doesn’t pay out until a far future date. 
  • Know your cancelation rights. For more information on cancelation rights for sales that occur in your home, go to https://www.dca.ca.gov/publications/legal_guides/k_9.shtml

 

 

  •  What are some signs of a living trust mill?

 

  • Scammers working for “living trust mills” may try to sell you an unnecessary living trust oryou’re your financial information to sell you products that are inferior to your current investments. 
  • Scammers often target seniors with “free” seminars at assisted living facilities, churches, vacation resorts and any other places where seniors gather. 
  • Be wary of “one size fits all” approaches to estate planning. Not every person needs a living trust, and if the professional you are working with is not taking time to find our your particular assets and needs, then that is a red flag. 

Consult the Law Office of David Knecht

At the  Law Office of David Knecht,, we understand the importance of creating an environment of trust and confidence. We will perform a one-on-one evaluation to help you create an estate plan that is customized for your needs. Call us at 707-451-4502.

 

Can I Sue My Ex for Defamation?

If you follow Hollywood news, you’ve probably heard a lot about the legal battle between Jonny Depp and Amber Heard. He is suing her for 50 million dollars for defamation for a 2018 op-ed piece in the Washington Post that alleged she was a “public figure representing domestic abuse.” She has counterclaimed for 100 million dollars, alleging that Depp and his former lawyer conspired to defame her by calling her allegations a hoax.  https://www.foxnews.com/entertainment/johnny-depp-may-lose-defamation-case-amber-heard-flops-stand-legal-experts-say

This article will provide an overview of defamation and California law to help explain how and when an ex can be sued for defamation. 

 

  •  What is defamation? 

 

  • Defamation is a broad term for statements that malign someone’s reputation. 
    • A statement made verbally is slander.  
    • A statement made in writing is libel.

 

  • What are the elements?

 

  • The statement must be false. A truthful statement, even if harmful, is not defamation. 
  • The statement must be presented as fact, not opinion, and be misleading intentionally, recklessly or negligently. 
  • It must be published, which means that someone besides you heard or read it. 
  • It must have actually hurt the reputation of the victim. 
  • It must have brought harm to the victim, such as a lost job or lost opportunity. 

 

  • Can statements made during my divorce trial or divorce settlement negotiations be defamation?

 

  • No, statements made during settlement negotiations would be made to your ex and their attorney, so they would almost never rise to the level of defamation. 
  • No, statements made during trial would not be defamatory because your purpose in going to trial is to tell the judge your side of the story. 

 

  •  Where can I find the laws relating to California defamation, i.e. libel and slander?

 

  • This is the link to the statute for slander: 

 

https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=46.&lawCode=CIV

 

Consult the Law Office of David Knecht

If you have questions about defamation and divorce or any family law question, please contact us at the  Law Office of David Knecht. We have extensive experience with divorce and family law issues and can answer your questions. Call us at 707-451-4502.

 

Top 5 Reasons for Divorce According to Research

If you are considering divorce in California, you may be curious as to how your marriage stacks up with your peers and whether your reasons for getting divorced are similar to others in the same situation. This article will summarize some of the research in the area of why people get divorced. 

 

  •  Money 

 

 

 

  • Struggles with money can manifest themselves in many ways:
  • Challenges with debt
  • One spouse feeling like they contribute more financially to the other
  • Control over decision-making with the money
  • Communication about money

 

 

 

  • Lack of sympathy, respect or trust

 

 

 

 

  • No sex, bad sex or lack of sexual compatibility 

 

  • According to one study, an estimated 15% of couples have not had sex in the last year. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5889124/

 

  •  Growing apart, falling out love

 

 

  •  Cheating

 

Consult the Law Office of David Knecht

If you are considering divorce. please contact us at the  Law Office of David Knecht. We have extensive experience with divorce and family law issues and can answer your questions. Call us at 707-451-4502.

 

Estate Planning Lessons from One Woman’s Journey with her Mother’s Cancer

A recent article published on Kiplinger.com was authored by an estate planning attorney whose own mother received a terminal cancer diagnosis. It was a poignant perspective from a woman who was a veteran in the estate planning field, only to have to call on that knowledge for her own family member.  

This article will summarize the takeaways from the unique perspective of an estate planner who had to plan for her own family member.  

 

How has the Schiavo case influenced estate planning?

  • Terri Schiavo was a woman who suffered a massive heart attack in 1990 and was left in a permanent vegetative state. Her husband and parents had a complicated and bitter legal battle over whether she would have wanted to be maintained in that vegetative state. 
  • This case was a horror story of what can happen in the absence of a clear advance medical directive. 
  • The number one lesson from this case is that the battle between the husband and the parents was preventable, had Schiavo properly prepared by making her wishes known and documented. 
  • Here you can see more details about the Schiavo case.  

 

Why might estate planning be particularly important for those of a particular faith?

  • In the Schiavo case, the role of faith played prominently in the push and pull of the end of life debate. 
  • Similarly, the author’s mother was part of a faith-based community and therefore had very strong beliefs about what her end-of-life care should look like and how her body should be treated in the final moments. 
  • The takehome lesson here is that family members can benefit from directives as to what the person wanted, what customs to follow, and what preferences to adhere to.   
  • The author’s experience with her mother helped her realize that the stress and emotion of a tough diagnosis are draining, so it can be particularly challenging to start on estate planning when someone’s health is in the declining stages.
  • It’s much easier to plan ahead during times of health.

CONTACT THE LAW OFFICE OF DAVID KNECHT TO GET STARTED ON ESTATE PLANNING

If you need help getting started on estate planning, or if you are looking to update or expand on work already completed, contact the  Law Office of David Knecht. We have extensive experience with estate planning in California. Contact us at 707-451-4502 for more information.  

 

Child Custody FAQ’s from the California Court

There are some questions that come up so often related to child custody that the California Courts have actually established an FAQ page with the answers to these common issues. This article will highlight some of the questions and answers that are often asked, but the entire FAQ page can be accessed here:  

 

Does joint legal custody mean that we have to agree on everything?

  • Joint legal custody means that both parents share the right and responsibility to make decisions relating to the health, education and welfare of the child. 
  • As per the Court FAQ’s, since both parents each have the right to make decisions, they can make them alone. However, both parents should communicate and cooperate with each other in making decisions. 

 

If we have joint physical custody, do parents have to spend exactly 50% of the time with each parent?

  • There are several physical custody options: 1) joint, where the children live with both parents, 2) primary, where the children live with one parent most of the time and visit the other parent, and 3) sole, where the children live with only one parent and rarely visit the other parent. 
  • Joint physical custody does not necessarily mean that the children must spend exactly half of their time with each parent because splitting the time with mathematical exactness can be challenging. 

Will I pay less child support if I have the children more often?

 

  • The amount of time that the children are spending with you is a factor in calculating child support. 
  • In general , the more time you have with your children, the less child support you will have to pay under the theory that you are spending more money to support the child when they are with you. HOWEVER, the child support formula is not based only on time, but also other factors, such as the other parent’s income. 

CONTACT THE LAW OFFICE OF DAVID KNECHT FOR HELP WITH A CALIFORNIA DIVORCE

Do you have questions about child custody or child support in California, or do you need help with other issues in a California divorce?  Contact the  Law Office of David Knecht. We have extensive experience with family law in California including divorce, child custody, modifications and more. Contact us at 707-451-4502 for more information.