Chicago Estate Planning Law Blog » 2008 » August

What to Have When You see The Chicago Probate Attorney

donthompson — Mon, 11 Aug 2008 15:47:48 +0000

Have as many of these things as possible:

1. The will, if any.

2. Death certificates.

3. Life insurance policies.

4. Names, addresses (including zip codes), phone numbers, Social Security numbers and ages of all heirs and all persons named in the will.

5. Be prepared to describe how the decedent was related to all persons involved, i.e., who was married to whom and what children did they have and who is alive and who is dead and when did they die.

6. Names, addresses (including zip codes), account numbers and amounts owed for all debts of the decedent and any pertinent documents.

7. A list of assets showing type, amount or value, who holds it, account number, and as much other information as possible along with any pertinent documents.

Contact Chicago Probate and Estate Planning Lawyer Don Thompson Today.

Jointly Owned Property

donthompson — Thu, 07 Aug 2008 20:26:23 +0000

If you own property with another person as joint tenants with right of survivorship,
that is, not as tenants in common, the property will pass directly to
the remaining joint tenant upon your death and will not be a part of
your probate estate. (It will, however, be a part of your taxable
estate.) Frequently, people (particularly in old age) will cause bank
accounts or securities to be placed in the name of the owner with one
or more children or trusted friends as joint tenants with right of
survivorship. This is sometimes done as a matter of convenience to give
the joint tenant continuing access to accounts to pay bills.

It
is important to realize that the ownership of property in this fashion
often leads to unexpected or unwanted results. Disputes, including
litigation, are common between the estate of the original owner and the
surviving joint tenant as to whether the survivor’s name was added as a
matter of convenience and/or management or whether a gift was intended.
The planning built into a well-drawn will may be partially or
completely thwarted by an inadvertently created joint tenancy that
passes property to a beneficiary by operation of law, rather than under
the terms of the will.

Many of these problems
are also applicable to institutional revocable trusts and "pay on
death" forms of ownership of bank, broker, and mutual fund accounts and
savings bonds. Effective planning requires knowledge of the
consequences of each property interest and technique.

For help with chicago estate planning contact Chicago estate planning expert Don Thompson.

What Happens if you Die Without a Will?

donthompson — Thu, 07 Aug 2008 20:23:14 +0000

If you die intestate (without a will), your state’s laws of descent and distribution will determine who receives your property by default. These laws vary from state to state, but typically the distribution would be to your spouse and children, or if none, to other family members. A state’s plan often reflects the legislature’s guess as to how most people would dispose of their estate and builds in protections for certain beneficiaries, particularly minor children. That plan may or may not reflect your actual wishes, and some of the built-in protections may not be necessary in a harmonious family setting. A will allows you to alter the state’s default plan to suit your personal preferences.
Source

Illinois Land Trusts

donthompson — Sun, 03 Aug 2008 19:22:41 +0000

An Illinois land trust is not a real trust. In a real trust a trustee takes title to assets and exercises all the rights of an owner over the assets. The trustee is responsible for managing and maintaining the assets. In a land trust this is not the case. The land trustee takes and holds title to land and does nothing else. The beneficiary or beneficiaries of the trust exercise all the other aspects of ownership.

The land trust is created by deeding land to the trustee. The deed is usually called a deed in trust. The former owner and the trustee enter into an agreement usually called a land trust agreement. The trustee is usually a bank with trust powers and the bank’s standard forms are used. The trustee charges a fee to set up the trust and also a yearly fee.

The Illinois type of land trust exists in only a few other states. Of course in Illinois and all other states land can be held in a regular trust where the trustee exercises the full rights of ownership. That type of trust usually is created with customized documents and as a result of individualized planning and is usually much more expensive.

The land trust in the past was used to conceal ownership. The land records show only the trustee as the owner. The trustee will not tell anyone who the real owner it. The identity of the real owner can be obtained through legal process after a suit is filed or, in some cases, by government agencies. However, the owner’s identify is much harder to find out when a land trust is used. Of course if someone who owns real estate transfers it to a land trust, the real estate records will reveal his or her prior ownership so it is best to take title in the land trust to begin with if you want to conceal your ownership. Also, the name and address on the tax bills are public information so a name and address that will not identify the owner should be selected.

The land trust can be used as a will substitute since the persons who will be the beneficial owners after the death of the original owner can be identified in the land trust agreement. As with a will, this can be amended from time to time.

This also allows the land trust property to be removed from probate. If the land trust agreement says who gets it, no will or statute of descent and distribution is needed. The property no longer exists in the decedent’s estate since his or her interest ended on death.

A regular trust can serve as a will substitute and keep the property in it out of probate too. So is a land trust a substitute for a regular trust? No. In a regular trust the trustee has active management duties. This feature is absent in the land trust. The land trust also requires that someone have the power of direction over the trustee. This includes the right to revoke or amend the trust.

While the beneficiary of a regular trust could have the unrestricted right to revoke or amend it, trusts are hardly ever set up this way. You might just as well give the assets to the beneficiary outright and leave it to him or her to hire a manager.

Of course the beneficiary of a land trust could be a regular trust. However, in that case you would not use the land trust at all. It would just be added complication, unless you wanted to conceal the ownership of the regular trust.

Joint tenancies and certain other devices can be used as will substitutes also and they result in avoiding probate. The advantage the land trust has over those devices is that you do not have to give the takers after death a present interest. A joint tenant has a present interest and must consent to any sale or mortgage of the property. In a land trust the beneficial owner can designate people to take on his or her death and can retain the right to change or revoke the designation and can retain sole control over the property during his or her life.

Land trusts convert the beneficial owner’s interest from real estate to personal property. The land trustee holds legal title to the real estate. One consequence of this is that the beneficial owners have no right to partition. Partition is the right of co-owners to have real estate divided or sold and the proceeds divided by court order.

Contact Donald M. Thompson for help with your Illinois land trust.

Chicago’s Premier Probate and Estate Planning Attorney

donthompson — Sun, 03 Aug 2008 19:17:13 +0000

Don Thompson is Chicago’s top Estate Planning and Probate Lawyer. He has years and years of expierience and does not over charge for his services.

Visit willandtrustschicago.com to view his broad range of knowledge and all he can do for you.

Contact Donal at donthompsonlaw@sbcglobal.net or call 312-782-0844. Alternatively you can send a fax to 312-201-1436.

Recent Cases

donthompson — Sun, 03 Aug 2008 10:27:27 +0000

In re Estate of Howell, 373 Ill.App.3d 342, 310 Ill.Dec. 868, 867 N.E.2d 559 (5th Dist, 2007). A will contest filed within the statutory time limit, but in the wrong division of the court – chancery instead of probate- is timely filed.

The Northern Trust Company v. Knox, et al, 373 Ill.App.3d 479, 311 Ill.Dec.727, 869 N.E.2d 401 (1st Dist., 2007). When interpreting the language of a trust the word "heirs" does not always mean persons appointed by law to inherit in case of intestacy – persons determined as of the date of death. The class of heirs is determined by the testator’s intention and the class can be determined at some time other than the named decedent’s death. For instance, the heirs of a life beneficiary of a trust can be determined as of the termination of the trust rather than at the date of the beneficiary’s death.

Allton v. Hintzsche, 373 Ill.App.3d 708, 312 Ill.Dec.371, 870 N.E.2d 436 (3rd Dist., 2007). Where a marital settlement agreement requires a parent to name his or her child as beneficiary of a life insurance policy and the parent fails to do so, a construstive trust may be imposed on the life insurance proceeds to protect the child’s interest. However, this only applies to existing policies. It does not apply where the agreement is to obtain a policy.

Estate of Lambrecht, 375 Ill.App.3d 865, 314 Ill.Dec.260, 874 N.E.2d 170 (1st Dist., 2007). The Appellate Court will defer to the judgment of the trial court regarding property valuation unless the trial court decision was against the manifest weight of the evidence. In cases involving the appraisal of property, appraisers have wide discretion with respect to the methods and procedures they folllow in determing value.

In re Estate of Phelan, 375 Ill.App.3d 875, 314 Ill.Dec.275, 874 N.E.2d 185 (1st Dist., 2007). A document will be incorporated into a will where: (1) the will itself refers to the document as being in existence at the time of execution of the will and in such a way as to reasonable identify it and make it a part thereof; (2) the ducument is in existence at the time of execution of the will; and (3) the document corresponds to the descrition in the will and is shown to be the instrumjent referred to therein. The document can be in existence even though it is not signed In Phelan a will made a gift to a trust created by a separate document. The trust was signed after the will. The court upheld the gift because the trust docunment was in existence at the time the will was signed.