tag:blogger.com,1999:blog-49939806248151075902024-03-13T21:26:19.418-07:00Matthew Mullhofer Attorney At Law | ProtectMyAssets.com | Matthew C MullhoferSince 1999, Matthew C. Mullhofer of ProtectMyAssets.com has been an attorney licensed by the State Bar of California and a member in good standing.
Matthew C Mullhofer has extensive experience in the area of estate planning and asset protection, which includes the formation of trusts, wills, family limited partnerships, limited liability companies, and domestic corporations.Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.comBlogger19125tag:blogger.com,1999:blog-4993980624815107590.post-45124424816798342362012-07-11T12:23:00.001-07:002012-07-11T12:23:44.394-07:00Converting from Corporate to a Limited Liability Company (LLC)<!--[if gte mso 9]><xml>
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A prospective client contacted Attorney Matthew C. Mullhofer
in regards to converting his corporation to a limited liability company (LLC);
he wanted to know what the benefits of converting were.<span style="mso-spacerun: yes;"> </span></div>
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Matthew C. Mullhofer explained that it wasn’t until recently
that California allowed a Corporation to convert to an LLC.<span style="mso-spacerun: yes;"> </span>The reason to convert a corporation into a
limited liability company (LLC), is to achieve better asset protection from
outside credits and have less ongoing documentation i.e. corporate minutes, but
not to be considered to have liquidated for income tax purposes.<span style="mso-spacerun: yes;"> </span>An important fact to know, Attorney Mullhofer
stated, is if a company owner wants to continue obtaining favorable tax
benefits as either a C Corporation or S Corporation a company owner will not be
subject to the gross receipt tax discussed below under the disadvantages of
utilizing an LLC.</div>
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Matthew C. Mullhofer explained that a major reason an LLC is
more appealing as a business entity is because you are not required under the Beverly-Killea
Limited Liability Company Act to have formal membership meetings compared to
corporations.<span style="mso-spacerun: yes;"> </span></div>
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Another reason why an LLC is more appealing under the Act in
comparison to the corporate laws under the State of California and other states
is the charging order protection.<span style="mso-spacerun: yes;"> </span>Under
a charging order, an outside creditor becomes only an assignee and will not be
able to vote your membership interest and dissolve the LLC compared to a
corporation and being able to vote your stock.</div>
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Attorney Mullhofer pointed out that after conversion an LLC
could still be taxed as a corporation by making certain of just a few
steps.<span style="mso-spacerun: yes;"> </span>First, by being certain that
before and after the conversion the equity interest remains the same.<span style="mso-spacerun: yes;"> </span>A reason why people would choose to want to
remain as corporations or be tax as one on formation is because family members
may prefer the certainty of corporate tax treatment for their closely held
business.<span style="mso-spacerun: yes;"> </span>However, an LLC taxed as a
corporation may deduct certain employee benefits.<span style="mso-spacerun: yes;"> </span></div>
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<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;">Call Matthew C.
Mullhofer today at (714) 827-9955 to discuss your business questions.</span></b></div>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-41740581120858389662012-05-01T14:43:00.000-07:002012-05-01T14:43:46.089-07:00How to save taxation on real estate sale<!--[if gte mso 9]><xml>
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A long time client of<span style="mso-spacerun: yes;">
</span>Matthew C. Mullhofer came in to the office today with a question in
regards to real estate taxation.<span style="mso-spacerun: yes;"> </span>He was
selling an apartment complex and was receiving a large amount of profit from
the sale.<span style="mso-spacerun: yes;"> </span>He had bought the apartment complex
in 1990 for $200,000.00 and a little over 20 years later, he was able to sell it
for $1,200,000.00.<span style="mso-spacerun: yes;"> </span>He was aware that he
was going to owe capital gains tax on his gain from this sale, and was
wondering if there was any way to prevent this.</div>
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<br /></div>
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Matthew C. Mullhofer advised his client that there was a way
to avoid the taxation and it was called a 1031 exchange, which prevented him
from owing capital gains tax.<span style="mso-spacerun: yes;"> </span>Mr.
Mullhofer explained that a 1031 exchange has been around since 1921.<span style="mso-spacerun: yes;"> </span>With a 1031 exchange, Matthew C. Mullhofer further
explained , his client could keep his entire profit from the sale growing and
working for him if he were to reinvest the money, and in doing so, he would
avoid taxation.<span style="mso-spacerun: yes;"> </span></div>
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<br /></div>
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Matthew C. Mullhofer gave a few brief guidelines one must
follow in order to have the 1031 exchange work (Mr. Mullhofer explained to meet
with an exchange expert before doing anything for a more detailed guidance):</div>
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<div class="MsoListParagraphCxSpFirst" style="text-indent: -0.25in;">
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;"> 1)<span style="font: 7.0pt "Times New Roman";"> </span></span></span>It is important to select an exchange
accommodator to receive the sales proceeds from the escrow company when the
property sells.<span style="mso-spacerun: yes;"> </span>If the client receives
the proceeds directly and not an intermediary, then the exchange will not
qualify in the transaction.<span style="mso-spacerun: yes;"> </span>That is why
it is important to complete this step before the closing date.</div>
<div class="MsoListParagraphCxSpMiddle" style="mso-list: l0 level1 lfo1; text-indent: -.25in;">
2)The client has 45 days to provide a list of
properties the client might buy as replacement (investment) properties to his
accommodator.</div>
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<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">3)<span style="font: 7.0pt "Times New Roman";">
</span></span></span>The client has 135 days (or 180 days from his
sale date) to close escrow on one, some, or all of the properties he sent to
his accommodater.<span style="mso-spacerun: yes;"> </span></div>
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<br /></div>
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Note: The deadlines listed are hard deadlines. They cannot
be moved or extended. It does not matter if the deadline is on a holiday; it is
still the date to have your obligations to be set up for.<span style="mso-spacerun: yes;"> </span></div>
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<br /></div>
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Matthew C. Mullhofer explained that all the equity and all
the debt the down-leg property had must be replaced when completing the up-leg
purchase.<span style="mso-spacerun: yes;"> </span>For example, if the client’s
$1,500,000.00 was $1,400,000.00 of equity and $100,000.00 of loan was repaid,
then the debt and equity numbers on his up-leg purchase(s) must be equal or
greater than these figures.<span style="mso-spacerun: yes;"> </span></div>
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<br /></div>
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Please feel free to contact Matthew Mullhofer Attorney at
(877) 246-2770, to discuss a 1031 exchange in more detail. </div>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-60978365967191520832012-01-11T09:50:00.001-08:002012-01-11T09:50:27.999-08:00Ways to Improve Your Credit Score<!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> <w:lidthemecomplexscript>X-NONE</w:LidThemeComplexScript> <w:compatibility> <w:breakwrappedtables/> <w:snaptogridincell/> <w:wraptextwithpunct/> <w:useasianbreakrules/> <w:dontgrowautofit/> <w:splitpgbreakandparamark/> 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mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} </style> <![endif]--><!--[if gte mso 9]><xml> <o:shapedefaults ext="edit" spidmax="1026"> </xml><![endif]--><!--[if gte mso 9]><xml> <o:shapelayout ext="edit"> <o:idmap ext="edit" data="1"> </o:shapelayout></xml><![endif]--> <p class="MsoNormal">A new client came into Matthew C. Mullhofer Attorney’s office with questions in regards to improving her credit score.<span style="mso-spacerun:yes"> </span>She divorced in 2004 and had to file for bankruptcy, and the case became final in 2005.<span style="mso-spacerun:yes"> </span>Her credit score was in the mid 600’s and she wanted advice as to how to improve her score.<span style="mso-spacerun:yes"> </span>She explained that currently she had no debt and she always pays her bills on time.</p> <p class="MsoNormal">Matthew C. Mullhofer Attorney advised this client to request a free copy of all three credit reports from annualcreditreport.com and review her credit score to make sure all entries were correct, including the bankruptcy.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal">Mr. Mullhofer let her know that according to the Fair Credit Reporting Act you can dispute inaccurate and incorrect information.<span style="mso-spacerun:yes"> </span>If the creditors do not respond to the disputed item within 30 days, it will be removed from the credit report.<span style="mso-spacerun:yes"> </span>This also includes public records that would have the bankruptcy listed.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal">Matthew C. Mullhofer Attorney let her know that she was on the right track, but she needed to have active revolving and installment credit being reported on her credit report in order to help her credit score.<span style="mso-spacerun:yes"> </span>He advised her not to obtain a huge amount of debt, and that she didntt need to keep balances on her credit cards in order to improve her credit score.<span style="mso-spacerun:yes"> </span>To pay her payments in full every month, and this should help her build her credit.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal">One last thing Mr. Mullhofer advised his client was to make sure to keep balances below 30 percent of the credit limit on any credit card.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal">Please feel free to contact Matthew Mullhofer Attorney at (877) 246-2770, to discuss any financial questions you may have.</p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-16933996156452351612012-01-09T15:59:00.000-08:002012-01-09T16:00:00.958-08:00Settling An Account For Less<!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> <w:lidthemecomplexscript>X-NONE</w:LidThemeComplexScript> <w:compatibility> <w:breakwrappedtables/> <w:snaptogridincell/> <w:wraptextwithpunct/> <w:useasianbreakrules/> <w:dontgrowautofit/> <w:splitpgbreakandparamark/> <w:dontvertaligncellwithsp/> <w:dontbreakconstrainedforcedtables/> <w:dontvertalignintxbx/> 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mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} </style> <![endif]--> <p class="MsoNormal">A client of Matthew C. Mullhofer Attorney came into his office the other day with a question in regards to settling a bill that he stopped making payments months ago.<span style="mso-spacerun:yes"> </span>He wanted to settle the account for less than what he owed and wanted to know the best way to handle this, and if there would be any way to prevent this from affecting his credit report negatively.</p> <p class="MsoNormal">Matthew C. Mullhofer advised him that whenever a person wants to try and settle an account for less than the amount owed, it is important to have the cash ready when you make the offer. Do not call the creditor and ask them what they will take.<span style="mso-spacerun:yes"> </span>If a person is not ready to act, don’t waste time.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal">When making the offer, it should be done at the end of the month since this is the time most creditors and collection agencies are trying to close their books for the month.<span style="mso-spacerun:yes"> </span>Mr. Mullhofer advised to have the cash ready and tell the creditor you can have the money them within 48 hours if they agree.</p> <p class="MsoNormal">The most important part that Matthew C. Mullhofer Attorney advised his client, is to get a letter from the creditor where they state the amount they have agreed to accept as payment in full with no additional charges once they have received your payment.<span style="mso-spacerun:yes"> </span>This letter should be signed, dated, and in your possession before you pay anything.<span style="mso-spacerun:yes"> </span>If they refuse to give you this letter, don’t pay.<span style="mso-spacerun:yes"> </span>Without this letter the creditors can later down the road state they never agreed to settle for a lesser amount.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal">When making payment, make sure to send it by certified mail or a means by which you can track the payment and make sure it arrived to its appropriate location.<span style="mso-spacerun:yes"> </span>Always make copies of your payment to them and keep it for your records for at least 5 years. </p> <p class="MsoNormal">Matthew C. Mullhofer Attorney advised his client to request they remove the entry from his credit report or at least report it as “paid” as part of the negotiation.<span style="mso-spacerun:yes"> </span><span style="mso-spacerun:yes"> </span>Request that the entry state “paid” and not “settled for less”.</p> <p class="MsoNormal">Please feel free to contact Matthew Mullhofer Attorney at (877) 246-2770, to discuss debt settlement or bankruptcy. </p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-42247806138321192642011-12-19T09:47:00.000-08:002011-12-19T09:51:17.852-08:00Planning Without Estate Tax Concerns<!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> 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mso-hansi-theme-font:minor-latin; mso-bidi-font-family:"Times New Roman"; mso-bidi-theme-font:minor-bidi;} </style> <![endif]--><!--[if gte mso 9]><xml> <o:shapedefaults ext="edit" spidmax="1026"> </xml><![endif]--><!--[if gte mso 9]><xml> <o:shapelayout ext="edit"> <o:idmap ext="edit" data="1"> </o:shapelayout></xml><![endif]--> <h2><span style="font-weight:normal;mso-bidi-font-weight:bold">A </span><span style="font-size:12.0pt;mso-bidi-font-size:18.0pt;font-weight:normal; mso-bidi-font-weight:bold">client of Matthew C. Mullhofer Attorney called him regarding the Estate Tax laws for the 2011-2012 years.<span style="mso-spacerun:yes"> </span>Mr. Mullhofer explained that the 2010 Tax Relief Act contained new tax arrangements for 2011 and 2012. These arrangements include a higher amount that can be transferred and a tax rate that is lowered which could take off the burden from many estates.</span></h2> <p class="MsoNormal">Matthew C. Mullhofer Attorney brought up to his client that in 2013 the estate tax is scheduled to become more aggressive which means that it could affect many families who are not considered wealthy.</p> <p class="MsoNormal"> Mr. Mullhofer went on to explain that for estates left behind in 2011 and 2012, assets exceeding a $5 million will be taxed at 35%(this has been the lowest tax rate in 70 years!). Married couples may be able to pool their exemptions to shield up to $10 million from federal estate taxes with the proper planning.<span style="mso-spacerun:yes"> </span>This means that 99% of the country may not be obligated to pay estate tax.<span style="mso-spacerun:yes"> </span>Planning is a key component when it comes to protecting assets and shifting income to heirs.<span style="mso-spacerun:yes"> </span>In today’s depreciated real estate market, $5 or $10 million is a lot of money.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal"> In order to transfer $5 or $10 million to their children, trustees have to establish the typical family trust that provides for the first 3.5 or 5 million to be transferred into their children’s trust, explained Mr. Mullhofer.<span style="mso-spacerun:yes"> </span>He recommended that the trust give the surviving spouse the ability to dictate how the distributions to their children will be if there is a change in circumstances after the death of the first spouse.<span style="mso-spacerun:yes"> </span>Unfortunately, this type of planning is not provided for in some family trust documents that Mr. Mullhofer has reviewed.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal"> Mr. Mullhofer’s client also wanted to know how to preserve and protect assets. Matthew C. Mullhofer Attorney explained that using a limited partnership or limited liability company would be one way to do that, especially wherever real estate is a major asset.<span style="mso-spacerun:yes"> </span>There are also different types of trusts to consider and choose from.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal"> Call Matthew C. Mullhofer Attorney today to discuss your Estate Tax concerns at (714) 827-9955.</p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-14493535812238000832011-12-14T14:37:00.000-08:002011-12-14T14:38:40.845-08:00Preserving the Family Business<!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> <w:lidthemecomplexscript>X-NONE</w:LidThemeComplexScript> <w:compatibility> <w:breakwrappedtables/> <w:snaptogridincell/> <w:wraptextwithpunct/> <w:useasianbreakrules/> <w:dontgrowautofit/> 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Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman","serif";} </style> <![endif]--> <p class="MsoNormal" style="line-height:200%">Matthew C. Mullhofer Attorney, was contacted by a new client that wanted some information on how to safely plan their family business to ensure its survival from one generation to the next.<span style="mso-spacerun:yes"> </span>Mr. Mullhofer, explained that statistically, family businesses have only a 20% chance of being successfully transferred from one generation to the next. Matthew C. Mullhofer Attorney, <span style="mso-spacerun:yes"> </span>explained that the failure to properly plan is what causes businesses to fail when getting transferred from one generation to the next.</p> <p class="MsoNormal" style="line-height:200%"><span style="mso-tab-count:1"> </span>Mr. Mullhofer let the clients know that until the end of 2012 a couple will be able to transfer up to $10 million estate tax free to their family, but in the beginning of 2013 the amount may be reduced to $7 million.<span style="mso-spacerun:yes"> </span>This means that approximately 98-99% of family businesses will not have to worry about death taxes, and a family business will not fail because of death taxes, so it is safe to say that properly planning is what a business needs in order for it to prosper from one generation to the next.</p> <p class="MsoNormal" style="line-height:200%"><span style="mso-tab-count:1"> </span>Matthew C. Mullhofer Attorne, gave them a list of a few basic questions that a business owner today must think about in order to properly deal with the major family asset.<span style="mso-spacerun:yes"> </span>Some of the basic questions that Mr. Mullhofer suggested are:</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>Who will be taking over the family business if owner wants it to continue to the next generation? Is it going to be a family member or some key employee?</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>Do the owner’s children want to continue the family business or not? If children are involved are they all involved or just one or two?<span style="mso-spacerun:yes"> </span>If so, how will the value of the business be shared after your death, if all of your children are to be treated equally?</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>If the business owner is married, how will the surviving spouse be able to have sufficient cash flow for the balance of his or her life?<span style="mso-spacerun:yes"> </span>Where will that cash flow come from?<span style="mso-spacerun:yes"> </span>If your business does not pay dividends now, will it after your death to your spouse?</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>Do you have assets that can be segregated from the business that can produce income without having to run the business if it is sold? For example, do you or the business own the real property where the business is located? If so, you should think about a long term lease for the survivor, if the new owner does not want to operate the business at the same location.<span style="mso-spacerun:yes"> </span>This way the survivors lease interest has to be dealt with if the business has to be sold.</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>Is there a key contract or license agreement that can be placed into a separate limited partnership or limited liability company for asset protection purposes from outside creditors?</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>Do you want to provide for your children only or for your grandchildren also?<span style="mso-spacerun:yes"> </span>If so, do you want your children to have an incoming with invasion of principal during their lifetime of the family assets in order to assure that there will be no estate tax owed on your childrens death?<span style="mso-spacerun:yes"> </span>This is call dynasty or generation skipping planning.</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;line-height:200%; mso-list:l0 level1 lfo1;tab-stops:list .5in"><span style="font-family:Wingdings;mso-fareast-font-family:Wingdings;mso-bidi-font-family: Wingdings"><span style="mso-list:Ignore">¨<span style="font:7.0pt "Times New Roman""> </span></span></span>If there is going to be a trustee for the surviving spouse from your portion of the family wealth that you own, who will be the trustee? Will it be the surviving spouse, your child or some third part? Can any of them run the family business or manage the family wealth if the business is sold?</p> <p class="MsoNormal" style="line-height:200%"> </p> <p class="MsoNormal" style="margin-left:.25in;line-height:200%">These questions are just a few out of many that Matthew C. Mullhofer Attorney, asks when developing a plan to preserve the family business. Devoting time to plan is a major component in preserving all the hard work that has gone into the business.<span style="mso-spacerun:yes"> </span></p> <p class="MsoNormal" style="margin-left:.25in;line-height:200%">Make an appointment with Matthew C. Mullhofer at (714) 827-9955 today so he can help you preserve your family business.</p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-40000935907119020142011-12-05T15:12:00.001-08:002011-12-05T15:12:59.110-08:00The New California Short Sale Law<!--[if gte mso 9]><xml> <o:officedocumentsettings> <o:relyonvml/> <o:allowpng/> </o:OfficeDocumentSettings> </xml><![endif]--><!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> <w:lidthemecomplexscript>X-NONE</w:LidThemeComplexScript> 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priority="73" semihidden="false" unhidewhenused="false" name="Colorful Grid Accent 6"> <w:lsdexception locked="false" priority="19" semihidden="false" unhidewhenused="false" qformat="true" name="Subtle Emphasis"> <w:lsdexception locked="false" priority="21" semihidden="false" unhidewhenused="false" qformat="true" name="Intense Emphasis"> <w:lsdexception locked="false" priority="31" semihidden="false" unhidewhenused="false" qformat="true" name="Subtle Reference"> <w:lsdexception locked="false" priority="32" semihidden="false" unhidewhenused="false" qformat="true" name="Intense Reference"> <w:lsdexception locked="false" priority="33" semihidden="false" unhidewhenused="false" qformat="true" name="Book Title"> <w:lsdexception locked="false" priority="37" name="Bibliography"> <w:lsdexception locked="false" priority="39" qformat="true" name="TOC Heading"> </w:LatentStyles> </xml><![endif]--><!--[if gte mso 10]> <style> /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} </style> <![endif]--> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">One of Matthew C. Mullhofer Attorney clients came into his office with a Real Estate question.<span style="mso-spacerun:yes"> </span>She wanted to know the details surrounding the New California Short Sale Law.<span style="mso-spacerun:yes"> </span>Mr. Mullhofer knew that the law was made to protect many homeowners, but there are many loopholes that a homeowner needs to be aware of.</span></p> <p class="MsoNormal" style="margin-bottom:0in;margin-bottom:.0001pt;line-height: normal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif""> </span><span style="font-size:12.0pt;font-family:"Times New Roman","serif"">The California Legislature recently passed Senate Bill 931 which added Section 580(e) to the California Code of Civil Procedure effective January 1, 2011.<span style="mso-spacerun:yes"> </span>This new section is great news for most short sale sellers.<span style="mso-spacerun:yes"> </span>It means that when a seller of a one-to-four unit residential property (occupied residential property that is the borrower's primary residence) with only a first deed of trust sells the property as a short sale the lender cannot come after them for the unpaid balance.<span style="mso-spacerun:yes"> </span></span><span style="font-size:12.0pt;font-family:"Times New Roman","serif";mso-fareast-font-family: "Times New Roman"">This law states that by approving the short sale, the lender is okay with the seller not paying the unpaid balance. </span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif""> There are some exceptions to this law, and they are: it does not apply to loans secured by other types of properties nor does it apply to second or other junior liens against the property.<span style="mso-spacerun:yes"> </span>The new law also does not apply if the borrower is a corporation or a political subdivision of the state.</span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">Two possible big exceptions are: if the borrower commits fraud and the second exception is if the borrower commits waste. In both of these situations the law will not limit the lenders ability to seek damages.</span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">A type of fraud that may have occurred which would remove the protection that this law offers might be: giving false information at the time the loan was being obtained in order to be approved for the short sale for example, misrepresenting hardship or concealment of additional offers. This would be sufficient enough to open the door to liability for the unpaid balance.</span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">Waste is a legal approach in which a party acts in a manner which takes away from the value of the property. For example, removing appliances or stripping electrical fixtures from the property.<span style="mso-spacerun:yes"> </span>This could take away the protections this new law gives.</span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">Even though there are some pros and cons to this law, Matthew C. Mullhofer Attorney explained that this new law is able to provide great protection. </span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">Call Matthew Mullhofer Attorney at (714) 827-9955 to have your Real Estate questions answered today!</span></p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-32747215469407598042011-11-29T15:37:00.000-08:002011-11-29T15:45:08.389-08:00Avoiding 'Alter Ego' Status<!--[if gte mso 9]><xml> <o:officedocumentsettings> <o:relyonvml/> <o:allowpng/> </o:OfficeDocumentSettings> </xml><![endif]--><!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> 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name="Bibliography"> <w:lsdexception locked="false" priority="39" qformat="true" name="TOC Heading"> </w:LatentStyles> </xml><![endif]--><!--[if gte mso 10]> <style> /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} </style> <![endif]--> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">A business owner was referred to Matthew C. Mullhofer by his long time client. The gentleman wanted to know how to eliminate various business risks by forming different entities in order to control the risk beyond insurance coverage. <span style="mso-spacerun:yes"> </span>Creditors like to defeat this type of corporate planning by using a legal theory called “alter ego” which means that they can reach all assets that are controlled by a business owner, in order to satisfy their judgments, so he wanted to know how to avoid this and keep all the entities separate. </span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">Matthew C. Mullhofer explained that the Federal and State Courts have provided a way to avoid having the activities of one entity merged into a sister entity by means of the “alter ego” theory.<span style="mso-spacerun:yes"> </span>If a creditor failed to prove the “alter ego” they would not have jurisdiction over the sister entity that has the deep pocket even when they may have personal jurisdiction over the other entity. </span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">In order for a Corporation of LLC to refrain from being considered the alter ego of another entity, Matthew C. Mullhofer explained, it must maintain these corporate formalities:</span></p> <p class="MsoListParagraphCxSpFirst" style="text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="font-size:12.0pt;line-height:115%;font-family:Symbol;mso-fareast-font-family: Symbol;mso-bidi-font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman""> </span></span></span><span style="font-size:12.0pt;line-height:115%; font-family:"Times New Roman","serif"">It must maintain separate books and accounting records;</span></p> <p class="MsoListParagraphCxSpMiddle" style="text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="font-size:12.0pt;line-height:115%;font-family:Symbol;mso-fareast-font-family: Symbol;mso-bidi-font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman""> </span></span></span><span style="font-size:12.0pt;line-height:115%; font-family:"Times New Roman","serif"">Maintain separate bank accounts;</span></p> <p class="MsoListParagraphCxSpMiddle" style="text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="font-size:12.0pt;line-height:115%;font-family:Symbol;mso-fareast-font-family: Symbol;mso-bidi-font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman""> </span></span></span><span style="font-size:12.0pt;line-height:115%; font-family:"Times New Roman","serif"">File separate tax returns;</span></p> <p class="MsoListParagraphCxSpMiddle" style="text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="font-size:12.0pt;line-height:115%;font-family:Symbol;mso-fareast-font-family: Symbol;mso-bidi-font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman""> </span></span></span><span style="font-size:12.0pt;line-height:115%; font-family:"Times New Roman","serif"">It must be sufficiently capitalized when it enters into business;</span></p> <p class="MsoListParagraphCxSpLast" style="text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="font-size:12.0pt;line-height:115%;font-family:Symbol;mso-fareast-font-family: Symbol;mso-bidi-font-family:Symbol"><span style="mso-list:Ignore">·<span style="font:7.0pt "Times New Roman""> </span></span></span><span style="font-size:12.0pt;line-height:115%; font-family:"Times New Roman","serif"">Loans or other capital transactions between entities should work together at an arm’s length transaction</span></p> <p class="MsoNormal"><span style="font-size:12.0pt;line-height:115%;font-family: "Times New Roman","serif"">Matthew C. Mullhofer helped his new client set up his businesses in a legal procedure. This in turn helped the client successfully maintain his business entities by following proper corporate formalities. </span></p> <p class="MsoNormal"><b style="mso-bidi-font-weight:normal"><span style="font-size:12.0pt;line-height:115%;font-family:"Times New Roman","serif"">Call Matthew C. Mullhofer today at (714) 827-9955 to discuss your business ownership questions.</span></b></p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-18132773039565685302011-11-22T13:47:00.000-08:002011-11-22T13:50:08.871-08:00Does the deed to the property you purchased accurately describe the property?<!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> <w:lidthemecomplexscript>X-NONE</w:LidThemeComplexScript> <w:compatibility> <w:breakwrappedtables/> <w:snaptogridincell/> <w:wraptextwithpunct/> 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<w:lsdexception locked="false" priority="65" semihidden="false" unhidewhenused="false" name="Medium List 1 Accent 6"> <w:lsdexception locked="false" priority="66" semihidden="false" unhidewhenused="false" name="Medium List 2 Accent 6"> <w:lsdexception locked="false" priority="67" semihidden="false" unhidewhenused="false" name="Medium Grid 1 Accent 6"> <w:lsdexception locked="false" priority="68" semihidden="false" unhidewhenused="false" name="Medium Grid 2 Accent 6"> <w:lsdexception locked="false" priority="69" semihidden="false" unhidewhenused="false" name="Medium Grid 3 Accent 6"> <w:lsdexception locked="false" priority="70" semihidden="false" unhidewhenused="false" name="Dark List Accent 6"> <w:lsdexception locked="false" priority="71" semihidden="false" unhidewhenused="false" name="Colorful Shading Accent 6"> <w:lsdexception locked="false" priority="72" semihidden="false" unhidewhenused="false" name="Colorful List Accent 6"> <w:lsdexception locked="false" priority="73" semihidden="false" unhidewhenused="false" name="Colorful Grid Accent 6"> <w:lsdexception locked="false" priority="19" semihidden="false" unhidewhenused="false" qformat="true" name="Subtle Emphasis"> <w:lsdexception locked="false" priority="21" semihidden="false" unhidewhenused="false" qformat="true" name="Intense Emphasis"> <w:lsdexception locked="false" priority="31" semihidden="false" unhidewhenused="false" qformat="true" name="Subtle Reference"> <w:lsdexception locked="false" priority="32" semihidden="false" unhidewhenused="false" qformat="true" name="Intense Reference"> <w:lsdexception locked="false" priority="33" semihidden="false" unhidewhenused="false" qformat="true" name="Book Title"> <w:lsdexception locked="false" priority="37" name="Bibliography"> <w:lsdexception locked="false" priority="39" qformat="true" name="TOC Heading"> </w:LatentStyles> </xml><![endif]--><!--[if gte mso 10]> <style> /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman","serif";} </style> <![endif]--> <p class="MsoNormal">This morning, Matthew C. Mullhofer’s long time client came into the office with a question regarding a recent purchase he was making. For insurance purposes he wanted to know how to find out if the deed to the home he was purchasing accurately described the property. Usually when a buyer purchases a home they rely on the property’s address to describe the real estate property they are purchasing, and when escrow is closing the buyer usually does not double check the legal description of their home in the deed to verify that it correctly describes the property they are purchasing which could cause problems down the line.</p> <p class="MsoNormal"> Matthew C. Mullhofer explained to his client that deeds will contain two or three lines of a legal description of the property if it is located in a subdivision, and the street address is often included in it as well.<span style="mso-spacerun:yes"> </span>If the property is not located in a subdivision, the legal description will be a “metes and bounds” legal description which usually consists of half a page or several pages containing the property’s terminal points and angles. So how does a buyer verify that the description matches the property? </p> <p class="MsoNormal"> Matthew C. Mullhofer advised that when going over the Preliminary Title Report which states the exact legal description of the property you are purchasing, the following should be observed:</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;mso-list:l0 level1 lfo1"> <span style="mso-list:Ignore">1)<span style="font:7.0pt "Times New Roman""> </span></span>If the property you are purchasing is part of a subdivision, it will appear to have straight lines and form a box type area. The legal description is usually relatively easy to read and verify once you confirm a starting point on the property.<span style="mso-spacerun:yes"> </span>However, before escrow closes it should be verified that the legal description on the title policy is the same as described in the Preliminary Report.</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="mso-list:Ignore">2)<span style="font:7.0pt "Times New Roman""> </span></span>If the property’s legal description is a metes and bounds legal description, the dimension of the meters and bounds should be sketched out by the title company as part of the Preliminary Report and escrow instructions should state the property being insured is illustrated by the drawing.</p> <p class="MsoNormal" style="margin-left:.5in;text-indent:-.25in;mso-list:l0 level1 lfo1"><span style="mso-list:Ignore">3)<span style="font:7.0pt "Times New Roman""> </span></span>The real issue is, if it is a metes and bounds description the title company will generally require a survey in order to insure the description of the property.<span style="mso-spacerun:yes"> </span>In this case, a surveyor should stake out the borders of the property, and provide the title insurance company with a certified copy of the survey of the property.<span style="mso-spacerun:yes"> </span>The survey will set forth the legal description.<span style="mso-spacerun:yes"> </span>There might be an additional fee to have the title company insure the legal description provided by the surveyor. </p> <p class="MsoNormal">Since 1999 The Law Office of Matthew C. Mullhofer has been helping clients with their real estate needs.<span style="mso-spacerun:yes"> </span>Please feel free to contact Mr. Mullhofer at (714) 827-9955 to discuss your real estate questions.</p> <!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> <w:lidthemecomplexscript>X-NONE</w:LidThemeComplexScript> <w:compatibility> <w:breakwrappedtables/> <w:snaptogridincell/> <w:wraptextwithpunct/> <w:useasianbreakrules/> <w:dontgrowautofit/> <w:splitpgbreakandparamark/> <w:dontvertaligncellwithsp/> <w:dontbreakconstrainedforcedtables/> <w:dontvertalignintxbx/> <w:word11kerningpairs/> 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mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman","serif";} </style> <![endif]-->Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-20830225398487093922011-11-14T14:50:00.000-08:002011-11-14T14:55:27.947-08:00Transferring Assets in a Safe Manner<!--[if gte mso 9]><xml> <o:officedocumentsettings> <o:relyonvml/> <o:allowpng/> </o:OfficeDocumentSettings> </xml><![endif]--><!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:trackmoves/> <w:trackformatting/> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:donotpromoteqf/> <w:lidthemeother>EN-US</w:LidThemeOther> <w:lidthemeasian>X-NONE</w:LidThemeAsian> 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Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} </style> <![endif]--><!--[if gte mso 9]><xml> <o:shapedefaults ext="edit" spidmax="1026"> </xml><![endif]--><!--[if gte mso 9]><xml> <o:shapelayout ext="edit"> <o:idmap ext="edit" data="1"> </o:shapelayout></xml><![endif]--> <p class="MsoNormal" style="font-family:times new roman;"><span style=" line-height: 115%;font-size:12pt;" >We all want the assets we have worked so hard to accumulate to be taken care of when we pass, especially if we want to pass these assets to a special trust. We would like to know that we did everything we could to make sure everything was in order and our trustees would have no problem in obtaining these assets that we were passing along to them, and this is the exact question Matthew Mullhofer’s long time client came into his office with.<span style="mso-spacerun:yes"> </span>What technique can an individual have regarding transferring assets to their heirs in a safe manner? A common question that people want to know is how to safely plan for a Personal Residence Trust, which is an important question because family residence is a major asset, so it is not surprising that safely transferring it to a special trust is important. <span style="mso-spacerun:yes"> </span>Congress has enacted a legislation that has approved a type of planning that will benefit all parties involved when doing a Personal Residence Trust.</span></p> <p class="MsoNormal" style="margin-bottom: 0.0001pt; line-height: normal; font-family:times new roman;"><span style="font-size:12pt;">A qualified personal residence trust can easily be approved if there has been a proper evaluation of the residence and if the parents transfer 50% interest in the residence which is allowed by IRS codification.<span style="mso-spacerun:yes"> </span>This is helpful when parents want to keep their separate interest in the residence.<span style="mso-spacerun:yes"> </span>The IRS limits this planning to two residences so parent(s) can transfer a second home or vacation home under this planning as well. This type of arrangement is usually done between parent and child, so there is not an increase in property taxes at the end of the fixed term. </span></p><span style="font-family:times new roman;"> </span> <p class="MsoNormal" style="margin-bottom: 0.0001pt; line-height: normal; font-family:times new roman;"><span style="font-size:12pt;"> A qualified personal residence trust (“QPRT”) is a trust that can be used to transfer your residence to your children at a extremely reduced gift tax cost and with no estate tax, and also allows you to continue to live in the residence for as long as you like is known as. You do not have to transfer your entire interest in the family residence. The Law Office of Matthe Mullhofer can help you with this. This is how it works:</span></p> <p class="MsoNormal" style="margin-bottom: 0.0001pt; line-height: normal; font-family:times new roman;"><span style="font-size:12pt;"> </span><b style="mso-bidi-font-weight: normal"><span style="font-size:12pt;">Trust for Fixed Term</span></b><span style="font-size:12pt;">: While you are still living, you can give your asset(residence) to a trustee, which can be yourself(California state law permits this).<span style="mso-spacerun:yes"> </span>The trustee must grant the right for you to live in the residence rent-free for a fixed number of years that is stated in the trust instrument, which would most likely be the number of years that you are likely to survive. During this term, you will pay mortgage expense, real estate taxes, insurance, and payments regarding maintenance and repairs(you can deduct mortgage interest and real estate taxes on your income tax return).<span style="mso-spacerun:yes"> </span>When the term is over, the asset stays in the trust for them or is given to your children.</span> </p><span style="font-family:times new roman;"> </span> <p class="MsoNormal" style="margin-bottom: 0.0001pt; line-height: normal;font-family:times new roman;"><b><span style="font-size:12pt;"><span style="mso-spacerun:yes"> </span>Maintenance after Fixed Term: </span></b><span style="font-size:12pt;">After the fixed term ends, you can keep using the residence in one of two ways. First, instead of immediately dispersing the residence to your children, the residence can be kept in trust for your spouse's lifetime(this is assuming that the residence is available to you). Or, there is another option of creating a lease with your children which will allow you to live in the residence for as long as you wish. However, keep in mind that if you create a lease you must pay market value rent to your children after the fixed term ends so the residence is not being charged estate tax on your death.</span></p><p class="MsoNormal" style="margin-bottom: 0.0001pt; line-height: normal; font-family:times new roman;"><span style="font-size:12pt;">If you are still living when the fixed term of the QPRT is over, your estate tax will not include the value of the residence. If you don't live through the fixed term, the estate tax will be affected as if you hadn't created the trust in the first place.<br /></span></p> <span style="font-family:times new roman;"> </span><p class="MsoNormal" style="margin-bottom:0in;margin-bottom:.0001pt;line-height: normal;mso-layout-grid-align:none;text-autospace:none"><span style=" ;font-family:times new roman;font-size:12pt;" >The rules regarding a QPRT can be complex.<span style="mso-spacerun:yes"> </span>If you are contemplating setting up a QPRT, feel free to contact Matthew Mullhofer to discuss this matter.</span><span style=" Times New Roman","serif"font-family:";font-size:12.0pt;" ></span></p>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-14878924345003872052010-07-28T11:14:00.000-07:002010-07-28T14:43:40.081-07:00How Long is Long Enough: Key Tips to Storing Income Tax RecordsWe all want to be safe, and nobody likes taking chances with the IRS. So how long should we save documents like income tax records and other relating materials? One of Matthew Mullhofer's clients wondered the same thing as he made his way in to the office for his 3 o'clock appointment.<br /><br />He wanted to be prepared for anything, while at the same time, feared his files would start to overflow with the number of papers he was stuffing in to them. Matthew Mullhofer sat him down, and promptly started explaining...<br /><br />At minimum, federal income-tax returns should be saved 3 years from the date the return was originally due; once again, this is at MINIMUM. To be SAFE, it is advised to save federal returns for at least 6 or 7 years. The reason for this being if you failed to report income that you should have reported and if its more than 25% of the gross income shown on your return, then "the period of limitations does not run out until six years after you filed the return," so says the IRS.<br /><br />However, These same rules DO NOT apply if you file a return that is "false or fraudulent." In this case, the IRS can take action generally at any time.<br /><br />When it comes to records showing how much you paid for stocks, bonds, mutual funds, real estate and other types of property that you bought and still own, it would be considered wise to hold on to these for very long periods of time. also to check if your state tax department has any special record keeping rules. Some states require you to hang on to old documents for longer than you would imagine, these are all based on IRS rules.<br /><br /><div>Matthew Mullhofer had one final piece of advise pertaining to the client's w-2 form (showing wages and other compensations). The client was advised to keep copy "C" until he began receiving social security benefits. This is in order to protect benefits in case there is a question about work records or earnings in a particular year. </div><div><br /></div><div><span class="Apple-style-span" style="font-family: Arial; font-size: 13px; line-height: 16px; "><b>Attorney Matthew C. Mullhofer can be reached toll free at </b><span class="yshortcuts" id="lw_1280353228_0" style="line-height: 1.2em; outline-style: none; outline-width: initial; outline-color: initial; border-bottom-style: dotted; border-bottom-width: 2px; border-bottom-color: rgb(54, 99, 136); cursor: pointer; background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: transparent; background-position: initial initial; background-repeat: initial initial; "><b>(877) 246-2770</b></span></span><br /><br /><br /><br /><br /><br /><br /></div>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-28322834077109907192009-06-27T16:24:00.000-07:002009-06-27T16:26:31.093-07:00Matthew C MullhoferHere is the video of a PowerPoint presentation Matthew C Mullhofer recently gave at a local conference.<br /><br /><object width="445" height="364"><param name="movie" value="http://www.youtube.com/v/qt6hHFrRIVU&hl=en&fs=1&rel=0&border=1"></param><param name="allowFullScreen" value="true"></param><param name="allowscriptaccess" value="always"></param><embed src="http://www.youtube.com/v/qt6hHFrRIVU&hl=en&fs=1&rel=0&border=1" type="application/x-shockwave-flash" allowscriptaccess="always" allowfullscreen="true" width="445" height="364"></embed></object>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-88102801568232435212009-03-25T11:29:00.000-07:002009-03-27T11:29:59.075-07:00Matthew Mullhofer: Attorney At Law Protects Your Assets<div style="text-align: left;"><a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="mailto:mcmlaw@protectmyassets.com"><img style="margin: 0pt 0pt 10px 10px; float: right; cursor: pointer; width: 129px; height: 162px;" src="http://www.protectmyassets.com/assets/matt_photo.jpg" alt="" border="0" /></a>Protecting your assets during a time of crisis is something everyone seeks to do. People work hard during their lifetime to make their lives comfortable. One bad legal judgment can change the way you and your family live if you are unprepared. Attorney at law <a style="font-style: italic; font-weight: bold;" href="http://www.protectmyassets.com/">Matthew C. Mullhofer</a> knows all about this topic as he focuses on helping families and people of business protect their assets so that they can not be seized in times of legal troubles involving both the government and in the instance of a lawsuit.<br /></div><br /><a href="http://www.protectmyassets.com/"><span style="font-weight: bold; font-style: italic;">Matthew Mullhofer</span></a> emphasizes the need to take precautionary measures when it comes to your assets. Once a judgment has been passed on you it's to late to transfer or protect your assets in any way. The time to do this is beforehand so that should the unthinkable happen your assets can not be seized.<br /><br />Matthew helps clients with needs pertaining to the following:<br /><ul><li>Frivolous Lawsuits</li><li>Trusts</li><li>Family Limited Partnerships<br /></li><li>Limited Liability Companies</li><li>Domestic Corporations</li><li>Estate Planning</li><li>Corporate acquisition, licensing, and registration of trademarks.</li></ul>There are numerous other services <a style="font-weight: bold; font-style: italic;" href="http://www.protectmyassets.com/">Matthew Mullhofer</a> offers his clients, all of which are designed to protect what you've worked so hard to earn or have a legal right to. To view a complete list of <a style="font-style: italic; font-weight: bold;" href="http://www.protectmyassets.com/about.html">Matthew Mullhofer's</a> services please visit his website. You may also <a href="mailto:mcmlaw@protectmyassets.com"><span style="font-weight: bold; font-style: italic;">contact Matthew</span></a> for assistance with any questions you might have.Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-78788628330657587592009-03-12T20:51:00.000-07:002009-03-20T09:52:00.438-07:00Beware of Offers to Reassess Home to Lower Property TaxesA Client recently walked into the Law Offices of Matthew Mullhofer asking for his opinion on a company advertising to reassess his home to lower his property tax.<br /><br /><br /><br />The company wanted $250.00 to file the application with the county assessor's office. Matthew Mullhofer weighed in on the issue because he had just gone through a similar situation with his property in Orange County.<br /><br /><br /><br />After researching the procedures for reassessment, Matthew Mullhofer indicated that the advertisement was over priced and that the company was offering to do something that the client could do for himself for free.<br /><br /><br /><br />These letters or advertisements come from companies called government property tax reassessment, county property tax reassessment, and gov. tax reassessment. These companies seem to be sending out their notices to everyone.<br /><br /><br /><br />The client asked Matthew Mullhofer, do these companies actually offer some value to the homeowner? When property values are down by double digits, in most areas, it does make sense to petition the county to lower your property taxes. The government says they routinely reappraise peoples homes whether they are asked to or not. However, the value that the government may reassess your property at maybe different from what fare market value is based on sales.<br /><br /><br /><br />That makes one wonder, what incentive does the county assessors have in lowering homeowners property taxes when the local governments are strapped financially. Matthew Mullhofer had researched the issue and found that the government did have a conflict of interest in promising to reduce property taxes but also begging for state and federal tax increases. The result was to search for experienced companies that would file and process the paper work for a reasonable fee.<br /><br /><br /><br />What was a reasonable fee, the client asked? No more than $50.00 said Matthew Mullhofer. A company that Matthew Mullhofer used personally called <a href="http://californiaproptaxappeal.com/">http://californiaproptaxappeal.com/</a> that he located on the internet, was willing to file the necessary paper work, including current sales comps in the area where the homeowner's house is located , charged $50.00 for the service.<br /><br /><br /><br />It is true that you can do this on your own but it seems the work involved would be worth the $50.00 spent.<br /><br /><br /><br />If you have questions regarding home values and tax reassessment, please feel free to contact the Law Offices of Matthew Mullhofer at (714) 827-9955.Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-46315407792638332962009-03-10T15:52:00.000-07:002009-03-11T22:18:17.837-07:00Costly Mistakes of Incorporating Your Company OnlineA client walked into the Law Offices of Matthew Mullhofer explaining why he decided not to use an online service to incorporate his new business.<br /><br />He explained to Matthew Mullhofer that he did not feel comfortable handing out vital information such as social security numbers, credit card accounts, and asset information to an unknown entity.<br /><br />Matthew Mullhofer agreed with the client's realistic fears of identity fraud and theft. Unlike online companies, attorneys are licensed by the state bar and are held accountable for their actions.<br /><br />In addition to the identity fraud issue, Matthew Mullhofer pointed out that there are many tax and legal consequences that must be addressed when setting up a new corporation such as what type of entity fits best for ones business. The choices are many: C-corp versus S-corp, limited liability companies versus corporations, and limited partnership versus general partnership. The online companies do not offer advice regarding these decisions.<br /><br />There are also tax considerations such as choosing a calendar year end over a fiscal year end. What are the proper business expenses and deductions? How does one go about making an initial stock offerings and how to provide proper capitalization for the company?<br /><br />Matthew Mullhofer also pointed out that if you do not follow the appropriate state and federal corporate formalities you may be in jeopardy in losing your limited liability status as a corporate officer/director.<br /><br />Incorporating your business is a legal process and should be left to the legal professionals.<br /><br />We all have different training and skill sets. You would not take your car to be fixed by anyone other than a car mechanic. As attorneys and tax professionals, we specialize in forming a corporate entity that can legally exist for many years to come.<br /><br />For more information on incorporating please visit Matthew Mullhofer's website at www.protectmyassets.comMatthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-39728295609469042452009-02-25T11:03:00.000-08:002009-02-26T16:58:49.834-08:00Organize Your Affairs Before Its Too LateTwo years ago, a client walked into the Law Office of <a href="http://www.protectmyassets.com/about.html">Matthew C. Mullhofer,</a> holding a probate court document concerning his deceased mother's estate. The client was confused. A week before his mother passed, she executed a deed to her house in the son's name and asked him to sell the house after her death and split the proceeds with his seven brothers and sisters.<br /><br />The son agreed to do this for her, and thought this would take care of her estate plan. Unfortunately, she did not have a last will or trust.<br /><br />The Probate court document was filed by a brother of the client. The brother felt that he should have been the one that would be in charge of selling the home and distributing the cash proceeds to the brothers and sisters.<br /><br />Needless to say, the case has been tied up in the Probate court for the last two and a half years. During that time the value of the home dropped by more than $250,000. All of the family members were affected by the case. Half chose one brother's side and the other half chose the other brother's side. They no longer speak to one another.<br /><br />We at the Law office of Matthew C. Mullhofer, work with clients to avoid this type of dispute before it can occur. A simple revocable trust for the mother would have listed instructions in writing as to how and when the house would be sold. It would have helped the family avoid this conflict and preserved the estate asset from being tied up in a long court battle. The trust would have allowed the house to be sold quickly after the mother's death and a much higher gain from the sale would have been available to the heirs.<br /><br />Above all, the family would have avoided having to choose sides and would have retained their close relationship.<br /><br />If you have a parent or a loved one that needs help planning their estate and getting their affairs in order, have them call Matthew C. Mullhofer at (714) 827-9955. You can also visit his website at www.protectmyassets.com<br /><br />Matthew C. MullhoferMatthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-8633539106492692822009-02-13T14:57:00.000-08:002009-02-19T17:12:50.716-08:00The Seven Costly Mistakes Of Using An Online Internet Service To Write Your Will Or Trust<span style="font-family: verdana;">So the time has come for you to start thinking about writing your will and/or </span><a style="font-family: verdana;" href="http://protectmyassets.com/reference/livingtrusts.html">living trust</a><span style="font-family: verdana;">, which is a very important step to take in ones life. In deciding whether to use the internet to write your trust, will or estate plan, the old adage holds true: “A man who represents himself in court, has a fool for a client.”</span>
<br />
<br /><span style="font-family: verdana;">Many people ask me, “Why do I need a living trust”. That is a very good question, because the answer is not always the same for every client. If you own Real Estate in California or any other state, it is important to hold title to that property in a trust. The main reason is that when you die, your intended heirs cannot transfer, sell, or refinance that property until they obtain a Court order allowing them to do so.</span>
<br />
<br /><span style="font-family: verdana;">This process is what we call "</span><a style="font-family: verdana;" href="http://protectmyassets.com/reference/probatevstrusts.html">Probate</a><span style="font-family: verdana;">". The probate process allows heirs to have the real estate and other personal property (ie: bank accounts, mutual funds, and CD’s) to be transferred to their name. The downside to probate is that it takes about 18 months to be final and the costs are extreme.</span>
<br />
<br />
<br /><span style="font-family: verdana;">For example, the cost to probate an estate worth $500,000 would be close to $20,000. This would include attorney’s fees, court filing fees, the posting of a bond and appraiser fees.</span>
<br />
<br /><span style="font-family: verdana;">The cost of a living trust properly prepared and funded by an attorney for a $500,000 estate would cost about $1500.</span><span style="font-weight: bold; font-family: verdana;">
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<br />1. THE COST OF THE IMPROPERLY PREPARED TRUST.</span>
<br /><span style="font-family: verdana;">Many people are the do-it-yourself type. This is a nice approach if you have unlimited time and do not care if you have made the proper decisions in changing title to every asset that you have worked so hard to achieve. If your re-titling project goes awry, your heirs may be required to go to court to persuade a judge of what you really intended to happen after you have died. The internet services do not provide the service of re-titling your assets into your trust.</span>
<br />
<br /><span style="font-family: verdana;">A trust must have your assets funded or transferred to the trust for it to work properly. Assets have legal title, such as your home, money market accounts or stocks and bonds. The title to your assets must be changed over to your trust.</span>
<br />
<br /><span style="font-family: verdana;">When you transfer title to the assets, you must have legal documentation properly filed and or recorded with the proper agency. If you miss something, or fail to record a deed, that asset will not pass to your heirs through the trust and will be subject to the probate process. For example, the cost to probate a asset worth $250,000 would be close to $12,000. This would include attorney’s fees, court filing fees, the posting of a bond and appraiser fees.</span>
<br />
<br /><span style="font-family: verdana;">An asset that is left out of the trust will have to pass through probate. This will cost money and take time to finalize the probate process. In addition, the asset (ie: stock account) will be frozen during this process. So if you have a stock that you would like to sell because it is selling at a high price, you cannot sell until the probate is final. Again, this may take 18 months, and during that time, the stock market may change and the price of your stock could fall.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">2. THE TIME INVOLVED IN PREPARING A TRUST CAN BE UNLIMITED.</span>
<br /><span style="font-family: verdana;">Estate planning attorneys usually need about four to eight hours to properly prepare, execute and fund a living trust. The time needed by an individual that has not had the training to prepare a trust could be more than twenty hours. And there is no guarantee that the self-written trust was properly completed. It is no different than you driving down the road and the “check engine” light goes off and you pull off onto the side of the road. You know that you can try to diagnose the problem on your own or you can take the car to a well trained mechanic that will charge you a fee to fix the problem with your car. You may be able to discover and fix the problem on your own, but how long will it take? Will you do it right the first time. If you don’t do it right, who will you hurt by your mistakes?</span>
<br />
<br /><span style="font-family: verdana;">If you miss something in putting the trust together, you are only adding more time onto the project, because the trust will most likely be thrown into the probate court. Time is something we do not have an unlimited amount of.</span>
<br />
<br /><span style="font-family: verdana;">In my practice, I often am faced with having to probate a trust for a family that was prepared by a non-attorney or internet service. In probate court, judges do not like trusts that were not prepared by attorneys. I have had the opportunity to see how probate judges view trusts prepared by non-attorney’s and look for defects that will allow the trust to be invalidated.</span>
<br />
<br /><span style="font-family: verdana;">Again, if the trust is invalidated, the assets are subject to the probate process and more time is added to the botched estate plan.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">3. THE TAX IMPLICATIONS OF IMPROPER ESTATE PLANNING.</span>
<br /><span style="font-family: verdana;">The internet services do not look at your net worth or entire estate to spot potential tax traps that could eat up your hard earned assets. A benefit of hiring an estate planning attorney to prepare your estate plan, they will advise you on what to do if your estate is subject to federal estate taxes.</span>
<br />
<br /><span style="font-family: verdana;">As of 2007, an estate worth over 2 million dollars will be taxed under the federal estate tax at rates of up to 49%. This means that, those assets that you have been taxed on during your lifetime, will be taxed again after you have died.</span>
<br />
<br /><span style="font-family: verdana;">If you make the right choices with trusts, gifting and insurance, you can eliminate and/or minimize these exorbitant taxes. I can assure you that an online service will not provide this valuable information to you.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">4. THE PROPER SUCCESSORS CAN MAKE OR BREAK YOUR PLAN.</span>
<br /><span style="font-family: verdana;">When you go online to do estate planning, you are filling out a series of standard questions. One question is, “who do you want to be in charge of the distribution of the assets after you have died?” There is no discussion as to why you choose that particular person.</span>
<br />
<br /><span style="font-family: verdana;">As an attorney, I take a very active role in helping my clients decide on who is the right person or persons to act as the successor trustee. Is this person ethical? Does this person have a business or financial background? Do they have outstanding debts or creditors suing them? Do they cave into the pressure of others? Are they reliable? These are all very important questions to consider when choosing your successor.</span>
<br />
<br /><span style="font-family: verdana;">I was once hired to sue a successor trustee for the beneficiaries, because he was diverting monies from the trust to pay for his gambling losses. This lawsuit cost the beneficiaries tens of thousands of dollars because the wrong person was appointed as the trustee and the trust was written by a non-attorney.</span>
<br />
<br /><span style="font-family: verdana;">In my practice, I receive many calls each month from a disgruntled beneficiary that wants to sue the successor trustee for </span><a style="font-family: verdana;" href="http://en.wikipedia.org/wiki/Embezzlement">embezzlement</a><span style="font-family: verdana;"> of trust assets. An internet service does not spend the time counseling the client on the pitfalls of choosing the wrong successor trustee.</span>
<br />
<br /><span style="font-family: verdana;">Another important question and decision is how should assets be distributed to an eighteen year old beneficiary. A typical eighteen year old lacks the ability to invest assets and manage an estate. A properly drafted trust can avoid the assets being squandered by a young inexperienced beneficiary. By using an attorney and not the internet, you can rest assured that your hard earned assets will not be lost at the craps table in Las Vegas.</span>
<br />
<br /><span style="font-family: verdana;">Another issue that is typically missed on an internet trust application is what to do if a beneficiary is disabled or becomes disabled. Persons with disabilities can qualify for aid from the government if they have a limited amount of assets. If your beneficiary is disabled and then has an asset transferred to him or her via a trust, then that disabled person may no longer qualify for the state aid.</span>
<br />
<br /><span style="font-family: verdana;">In our client interview, there is always a discussion about the age, maturity, and mental capacity of your intended beneficiaries. I also should mention about looking out for the opportunistic gold digger {daughter-in-law/daughter-in-law}. These people are always discussed in our consultation. I have never seen an internet application that inquires as to whether you trust your son-in-law.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">5. THE DUTIES AND LIABILITIES OF A TRUSTEE.</span>
<br /><span style="font-family: verdana;">By accepting the role of a trustee, that particular person is taking on responsibilities and potential liability if that trustee/successor trustee fails to follow state laws, the terms of the trust or does not pay creditors. The trustee can be sued in a court of law for failing to prepare the proper accounting documents on behalf of the trust.</span>
<br />
<br /><span style="font-family: verdana;">Non-attorneys and online services do not have court experience and do not have the insight on how to counsel clients on how to avoid these pitfalls.</span>
<br />
<br /><span style="font-family: verdana;">In my practice, I have the ability to share with clients the mistakes that I have seen made by others that were unrepresented and the consequences that were doled out due to those mistakes. For example, states provide statutes that define the duties and responsibilities of a trustee, if the trustee fails to act or acts negligently, the trust beneficiaries can sue the trustee for negligence.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">6. WHO IS ACCOUNTABLE IF MISTAKES ARE MADE?</span>
<br /><span style="font-family: verdana;">When you use a website to write a trust and things do not turn out properly, you have little recourse in correcting the mistakes. You do not have a warranty. Even if the website offers a money back guarantee, a refund of $300 will not get you very far in the probate court.</span>
<br />
<br /><span style="font-family: verdana;">Attorneys are required to maintain good standing with the state bar and attend continuing legal education seminars on the recent changes in the law. Attorneys also typically carry malpractice insurance. I always let my clients know that I carry malpractice insurance and that they are covered if a mistake were made. In the planning stages of your estate plan and trust preparation it makes no sense to be penny wise and pound foolish.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">7. ARE THERE ANY OTHER DOCUMENTS THAT NEED TO BE PREPARED?</span>
<br /><span style="font-family: verdana;">The living trust is usually not the only document that is needed to complete your estate plan. Every family has different needs and an in depth discussion is necessary to spot all of the legal issues. It is important to add durable powers of attorney for asset management, advance health care directives, pour-over wills, irrevocable life insurance trusts, and special needs trusts are other documents to be considered. To make this decision, the client needs full disclosure as to why these documents may be necessary.</span>
<br />
<br /><span style="font-family: verdana;">I also treat a client engagement as an opportunity to help educate that person on each of these documents and how they work and the importance of each tool. If I am not properly passing on my knowledge to my client, I am not doing my job. I enjoy helping people. That is why I became an attorney. It takes time to explain the importance of these estate planning tools. It is not fair to the client if they do not have a chance to explore all of their options.</span>
<br />
<br /><span style="font-family: verdana;">I have used these internet sites before, I have even owned my own internet site. The goal of owning an internet site is to be able to sell products or services without having to develop a working relationship with the customer. It is all about generating income without having to answer questions. In the area of estate planning, if your questions are not answered you are headed for failure.</span>
<br />
<br /><span style="font-weight: bold; font-family: verdana;">IDENTITY THEFT AND FRAUD</span>
<br /><span style="font-family: verdana;">One last parting thought is regarding the problems with </span><a style="font-family: verdana;" href="http://en.wikipedia.org/wiki/Identity_theft">identity theft</a><span style="font-family: verdana;"> and fraud. When you set up a trust, you must disclose information about you, and your assets. In today’s world of crimes being committed on the internet,</span><a style="font-family: verdana;" href="http://protectmyassets.com/reference/12steps.html"> it does not make sense to disclose your sensitive information to a company that you know nothing about</a><span style="font-family: verdana;">. You do not know who the owner is and you never get to meet their staff. Would you give your birth date, social security number and the whereabouts of your assets to a perfect stranger? When using the internet to set up your trust, you will be required to disclose private information to people that you do not know. This in of itself is a scary proposition.</span>
<br />
<br /><span style="font-family: verdana;">I hope this information was helpful and encourages you protect yourself and those who are, or will be a part of your will or living trust. For information, please visit </span><a style="font-family: verdana;" href="http://www.protectmyassets.com/">www.protectmyassets.com</a><span style="font-family: verdana;">.</span>
<br /><meta equiv="Content-Type" content="text/html; charset=utf-8"><meta name="ProgId" content="Word.Document"><meta name="Generator" content="Microsoft Word 11"><meta name="Originator" content="Microsoft Word 11"><link style="font-family: arial;" rel="File-List" href="file:///C:%5CDOCUME%7E1%5CKSPANG%7E1%5CLOCALS%7E1%5CTemp%5Cmsohtml1%5C01%5Cclip_filelist.xml"><!--[if gte mso 9]><xml> <w:worddocument> <w:view>Normal</w:View> <w:zoom>0</w:Zoom> <w:punctuationkerning/> <w:validateagainstschemas/> <w:saveifxmlinvalid>false</w:SaveIfXMLInvalid> <w:ignoremixedcontent>false</w:IgnoreMixedContent> <w:alwaysshowplaceholdertext>false</w:AlwaysShowPlaceholderText> <w:compatibility> <w:breakwrappedtables/> <w:snaptogridincell/> <w:wraptextwithpunct/> <w:useasianbreakrules/> <w:dontgrowautofit/> </w:Compatibility> <w:browserlevel>MicrosoftInternetExplorer4</w:BrowserLevel> </w:WordDocument> </xml><![endif]--><!--[if gte mso 9]><xml> <w:latentstyles deflockedstate="false" latentstylecount="156"> </w:LatentStyles> </xml><![endif]--><style> <!-- /* Style Definitions */ p.MsoNormal, li.MsoNormal, div.MsoNormal {mso-style-parent:""; margin:0in; margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:12.0pt; font-family:"Times New Roman"; mso-fareast-font-family:"Times New Roman";} @page Section1 {size:8.5in 11.0in; margin:1.0in 1.25in 1.0in 1.25in; mso-header-margin:.5in; mso-footer-margin:.5in; mso-paper-source:0;} div.Secti1. THE COST OF THE IMPROPERLY PREPARED TRUST. Many people are the do-it-yourself type. This is a nice approach if you have unlimited time and do not care if you have made the proper decisions in changing title to every asset that you have worked so hard to achieve. If your re-titling project goes awry, your heirs may be required to go to court to persuade a judge of what you really intended to happen after you have died. The internet services do not provide the service of re-titling your assets into your trust. A trust must have your assets funded or transferred to the trust for it to work properly. Assets have legal title, such as your home, money market accounts or stocks and bonds. The title to your assets must be changed over to your trust. When you transfer title to the assets, you must have legal documentation properly filed and or recorded with the proper agency. If you miss something, or fail to record a deed, that asset will not pass to your heirs through the trust and will be subject to the probate process. For example, the cost to probate a asset worth $250,000 would be close to $12,000. This would include attorney’s fees, court filing fees, the posting of a bond and appraiser fees. An asset that is left out of the trust will have to pass through probate. This will cost money and take time to finalize the probate process. In addition, the asset (ie: stock account) will be frozen during this process. So if you have a stock that you would like to sell because it is selling at a high price, you cannot sell until the probate is final. Again, this may take 18 months, and during that time, the stock market may change and the price of your stock could fall. 2. THE TIME INVOLVED IN PREPARING A TRUST CAN BE UNLIMITED. Estate planning attorneys usually need about four to eight hours to properly prepare, execute and fund a living trust. The time needed by an individual that has not had the training to prepare a trust could be more than twenty hours. And there is no guarantee that the self-written trust was properly completed. It is no different than you driving down the road and the “check engine” light goes off and you pull off onto the side of the road. You know that you can try to diagnose the problem on your own or you can take the car to a well trained mechanic that will charge you a fee to fix the problem with your car. You may be able to discover and fix the problem on your own, but how long will it take? Will you do it right the first time. If you don’t do it right, who will you hurt by your mistakes? If you miss something in putting the trust together, you are only adding more time onto the project, because the trust will most likely be thrown into the probate court. Time is something we do not have an unlimited amount of. In my practice, I often am faced with having to probate a trust for a family that was prepared by a non-attorney or internet service. In probate court, judges do not like trusts that were not prepared by attorneys. I have had the opportunity to see how probate judges view trusts prepared by non-attorney’s and look for defects that will allow the trust to be invalidated. Again, if the trust is invalidated, the assets are subject to the probate process and more time is added to the botched estate plan. 3. THE TAX IMPLICATIONS OF IMPROPER ESTATE PLANNING. The internet services do not look at your net worth or entire estate to spot potential tax traps that could eat up your hard earned assets. A benefit of hiring an estate planning attorney to prepare your estate plan, they will advise you on what to do if your estate is subject to federal estate taxes. As of 2007, an estate worth over 2 million dollars will be taxed under the federal estate tax at rates of up to 49%. This means that, those assets that you have been taxed on during your lifetime, will be taxed again after you have died. If you make the right choices with trusts, gifting and insurance, you can eliminate and/or minimize these exorbitant taxes. I can assure you that an online service will not provide this valuable information to you. 4. THE PROPER SUCCESSORS CAN MAKE OR BREAK YOUR PLAN. When you go online to do estate planning, you are filling out a series of standard questions. One question is, “who do you want to be in charge of the distribution of the assets after you have died?” There is no discussion as to why you choose that particular person. As an attorney, I take a very active role in helping my clients decide on who is the right person or persons to act as the successor trustee. Is this person ethical? Does this person have a business or financial background? Do they have outstanding debts or creditors suing them? Do they cave into the pressure of others? Are they reliable? These are all very important questions to consider when choosing your successor. I was once hired to sue a successor trustee for the beneficiaries, because he was diverting monies from the trust to pay for his gambling losses. This lawsuit cost the beneficiaries tens of thousands of dollars because the wrong person was appointed as the trustee and the trust was written by a non-attorney. In my practice, I receive many calls each month from a disgruntled beneficiary that wants to sue the successor trustee for embezzlement of trust assets. An internet service does not spend the time counseling the client on the pitfalls of choosing the wrong successor trustee. Another important question and decision is how should assets be distributed to an eighteen year old beneficiary. A typical eighteen year old lacks the ability to invest assets and manage an estate. A properly drafted trust can avoid the assets being squandered by a young inexperienced beneficiary. By using an attorney and not the internet, you can rest assured that your hard earned assets will not be lost at the craps table in Las Vegas. Another issue that is typically missed on an internet trust application is what to do if a beneficiary is disabled or becomes disabled. Persons with disabilities can qualify for aid from the government if they have a limited amount of assets. If your beneficiary is disabled and then has an asset transferred to him or her via a trust, then that disabled person may no longer qualify for the state aid. In our client interview, there is always a discussion about the age, maturity, and mental capacity of your intended beneficiaries. I also should mention about looking out for the opportunistic gold digger {daughter-in-law/daughter-in-law}. These people are always discussed in our consultation. I have never seen an internet application that inquires as to whether you trust your son-in-law. 5. THE DUTIES AND LIABILITIES OF A TRUSTEE. By accepting the role of a trustee, that particular person is taking on responsibilities and potential liability if that trustee/successor trustee fails to follow state laws, the terms of the trust or does not pay creditors. The trustee can be sued in a court of law for failing to prepare the proper accounting documents on behalf of the trust. Non-attorneys and online services do not have court experience and do not have the insight on how to counsel clients on how to avoid these pitfalls. In my practice, I have the ability to share with clients the mistakes that I have seen made by others that were unrepresented and the consequences that were doled out due to those mistakes. For example, states provide statutes that define the duties and responsibilities of a trustee, if the trustee fails to act or acts negligently, the trust beneficiaries can sue the trustee for negligence. 6. WHO IS ACCOUNTABLE IF MISTAKES ARE MADE? When you use a website to write a trust and things do not turn out properly, you have little recourse in correcting the mistakes. You do not have a warranty. Even if the website offers a money back guarantee, a refund of $300 will not get you very far in the probate court. Attorneys are required to maintain good standing with the state bar and attend continuing legal education seminars on the recent changes in the law. Attorneys also typically carry malpractice insurance. I always let my clients know that I carry malpractice insurance and that they are covered if a mistake were made. In the planning stages of your estate plan and trust preparation it makes no sense to be penny wise and pound foolish. 7. ARE THERE ANY OTHER DOCUMENTS THAT NEED TO BE PREPARED? The living trust is usually not the only document that is needed to complete your estate plan. Every family has different needs and an in depth discussion is necessary to spot all of the legal issues. It is important to add durable powers of attorney for asset management, advance health care directives, pour-over wills, irrevocable life insurance trusts, and special needs trusts are other documents to be considered. To make this decision, the client needs full disclosure as to why these documents may be necessary. I also treat a client engagement as an opportunity to help educate that person on each of these documents and how they work and the importance of each tool. If I am not properly passing on my knowledge to my client, I am not doing my job. I enjoy helping people. That is why I became an attorney. It takes time to explain the importance of these estate planning tools. It is not fair to the client if they do not have a chance to explore all of their options. I have used these internet sites before, I have even owned my own internet site. The goal of owning an internet site is to be able to sell products or services without having to develop a working relationship with the customer. It is all about generating income without having to answer questions. In the area of estate planning, if your questions are not answered you are headed for failure. IDENTITY THEFT AND FRAUD One last parting thought is regarding the problems with identity theft and fraud. When you set up a trust, you must disclose information about you, and your assets. In today’s world of crimes being committed on the internet, it does not make sense to disclose your sensitive information to a company that you know nothing about. You do not know who the owner is and you never get to meet their staff. Would you give your birth date, social security number and the whereabouts of your assets to a perfect stranger? When using the internet to set up your trust, you will be required to disclose private information to people that you do not know. This in of itself is a scary proposition. I hope this information was helpful and encourages you protect yourself and those who are, or will be a part of your will or living trust. For information, please visit www.protectmyassets.com. 1. THE COST OF THE IMPROPERLY PREPARED TRUST. Many people are the do-it-yourself type. This is a nice approach if you have unlimited time and do not care if you have made the proper decisions in changing title to every asset that you have worked so hard to achieve. If your re-titling project goes awry, your heirs may be required to go to court to persuade a judge of what you really intended to happen after you have died. The internet services do not provide the service of re-titling your assets into your trust. A trust must have your assets funded or transferred to the trust for it to work properly. Assets have legal title, such as your home, money market accounts or stocks and bonds. The title to your assets must be changed over to your trust. When you transfer title to the assets, you must have legal documentation properly filed and or recorded with the proper agency. If you miss something, or fail to record a deed, that asset will not pass to your heirs through the trust and will be subject to the probate process. For example, the cost to probate a asset worth $250,000 would be close to $12,000. This would include attorney’s fees, court filing fees, the posting of a bond and appraiser fees. An asset that is left out of the trust will have to pass through probate. This will cost money and take time to finalize the probate process. In addition, the asset (ie: stock account) will be frozen during this process. So if you have a stock that you would like to sell because it is selling at a high price, you cannot sell until the probate is final. Again, this may take 18 months, and during that time, the stock market may change and the price of your stock could fall. 2. THE TIME INVOLVED IN PREPARING A TRUST CAN BE UNLIMITED. Estate planning attorneys usually need about four to eight hours to properly prepare, execute and fund a living trust. The time needed by an individual that has not had the training to prepare a trust could be more than twenty hours. And there is no guarantee that the self-written trust was properly completed. It is no different than you driving down the road and the “check engine” light goes off and you pull off onto the side of the road. You know that you can try to diagnose the problem on your own or you can take the car to a well trained mechanic that will charge you a fee to fix the problem with your car. You may be able to discover and fix the problem on your own, but how long will it take? Will you do it right the first time. If you don’t do it right, who will you hurt by your mistakes? If you miss something in putting the trust together, you are only adding more time onto the project, because the trust will most likely be thrown into the probate court. Time is something we do not have an unlimited amount of. In my practice, I often am faced with having to probate a trust for a family that was prepared by a non-attorney or internet service. In probate court, judges do not like trusts that were not prepared by attorneys. I have had the opportunity to see how probate judges view trusts prepared by non-attorney’s and look for defects that will allow the trust to be invalidated. Again, if the trust is invalidated, the assets are subject to the probate process and more time is added to the botched estate plan. 3. THE TAX IMPLICATIONS OF IMPROPER ESTATE PLANNING. The internet services do not look at your net worth or entire estate to spot potential tax traps that could eat up your hard earned assets. A benefit of hiring an estate planning attorney to prepare your estate plan, they will advise you on what to do if your estate is subject to federal estate taxes. As of 2007, an estate worth over 2 million dollars will be taxed under the federal estate tax at rates of up to 49%. This means that, those assets that you have been taxed on during your lifetime, will be taxed again after you have died. If you make the right choices with trusts, gifting and insurance, you can eliminate and/or minimize these exorbitant taxes. I can assure you that an online service will not provide this valuable information to you. 4. THE PROPER SUCCESSORS CAN MAKE OR BREAK YOUR PLAN. When you go online to do estate planning, you are filling out a series of standard questions. One question is, “who do you want to be in charge of the distribution of the assets after you have died?” There is no discussion as to why you choose that particular person. As an attorney, I take a very active role in helping my clients decide on who is the right person or persons to act as the successor trustee. Is this person ethical? Does this person have a business or financial background? Do they have outstanding debts or creditors suing them? Do they cave into the pressure of others? Are they reliable? These are all very important questions to consider when choosing your successor. I was once hired to sue a successor trustee for the beneficiaries, because he was diverting monies from the trust to pay for his gambling losses. This lawsuit cost the beneficiaries tens of thousands of dollars because the wrong person was appointed as the trustee and the trust was written by a non-attorney. In my practice, I receive many calls each month from a disgruntled beneficiary that wants to sue the successor trustee for embezzlement of trust assets. An internet service does not spend the time counseling the client on the pitfalls of choosing the wrong successor trustee. Another important question and decision is how should assets be distributed to an eighteen year old beneficiary. A typical eighteen year old lacks the ability to invest assets and manage an estate. A properly drafted trust can avoid the assets being squandered by a young inexperienced beneficiary. By using an attorney and not the internet, you can rest assured that your hard earned assets will not be lost at the craps table in Las Vegas. Another issue that is typically missed on an internet trust application is what to do if a beneficiary is disabled or becomes disabled. Persons with disabilities can qualify for aid from the government if they have a limited amount of assets. If your beneficiary is disabled and then has an asset transferred to him or her via a trust, then that disabled person may no longer qualify for the state aid. In our client interview, there is always a discussion about the age, maturity, and mental capacity of your intended beneficiaries. I also should mention about looking out for the opportunistic gold digger {daughter-in-law/daughter-in-law}. These people are always discussed in our consultation. I have never seen an internet application that inquires as to whether you trust your son-in-law. 5. THE DUTIES AND LIABILITIES OF A TRUSTEE. By accepting the role of a trustee, that particular person is taking on responsibilities and potential liability if that trustee/successor trustee fails to follow state laws, the terms of the trust or does not pay creditors. The trustee can be sued in a court of law for failing to prepare the proper accounting documents on behalf of the trust. Non-attorneys and online services do not have court experience and do not have the insight on how to counsel clients on how to avoid these pitfalls. In my practice, I have the ability to share with clients the mistakes that I have seen made by others that were unrepresented and the consequences that were doled out due to those mistakes. For example, states provide statutes that define the duties and responsibilities of a trustee, if the trustee fails to act or acts negligently, the trust beneficiaries can sue the trustee for negligence. 6. WHO IS ACCOUNTABLE IF MISTAKES ARE MADE? When you use a website to write a trust and things do not turn out properly, you have little recourse in correcting the mistakes. You do not have a warranty. Even if the website offers a money back guarantee, a refund of $300 will not get you very far in the probate court. Attorneys are required to maintain good standing with the state bar and attend continuing legal education seminars on the recent changes in the law. Attorneys also typically carry malpractice insurance. I always let my clients know that I carry malpractice insurance and that they are covered if a mistake were made. In the planning stages of your estate plan and trust preparation it makes no sense to be penny wise and pound foolish. 7. ARE THERE ANY OTHER DOCUMENTS THAT NEED TO BE PREPARED? The living trust is usually not the only document that is needed to complete your estate plan. Every family has different needs and an in depth discussion is necessary to spot all of the legal issues. It is important to add durable powers of attorney for asset management, advance health care directives, pour-over wills, irrevocable life insurance trusts, and special needs trusts are other documents to be considered. To make this decision, the client needs full disclosure as to why these documents may be necessary. I also treat a client engagement as an opportunity to help educate that person on each of these documents and how they work and the importance of each tool. If I am not properly passing on my knowledge to my client, I am not doing my job. I enjoy helping people. That is why I became an attorney. It takes time to explain the importance of these estate planning tools. It is not fair to the client if they do not have a chance to explore all of their options. I have used these internet sites before, I have even owned my own internet site. The goal of owning an internet site is to be able to sell products or services without having to develop a working relationship with the customer. It is all about generating income without having to answer questions. In the area of estate planning, if your questions are not answered you are headed for failure. IDENTITY THEFT AND FRAUD One last parting thought is regarding the problems with identity theft and fraud. When you set up a trust, you must disclose information about you, and your assets. In today’s world of crimes being committed on the internet, it does not make sense to disclose your sensitive information to a company that you know nothing about. You do not know who the owner is and you never get to meet their staff. Would you give your birth date, social security number and the whereabouts of your assets to a perfect stranger? When using the internet to set up your trust, you will be required to disclose private information to people that you do not know. This in of itself is a scary proposition. I hope this information was helpful and encourages you protect yourself and those who are, or will be a part of your will or living trust. For information, please visit www.protectmyassets.com. 1. THE COST OF THE IMPROPERLY PREPARED TRUST. Many people are the do-it-yourself type. This is a nice approach if you have unlimited time and do not care if you have made the proper decisions in changing title to every asset that you have worked so hard to achieve. If your re-titling project goes awry, your heirs may be required to go to court to persuade a judge of what you really intended to happen after you have died. The internet services do not provide the service of re-titling your assets into your trust. A trust must have your assets funded or transferred to the trust for it to work properly. Assets have legal title, such as your home, money market accounts or stocks and bonds. The title to your assets must be changed over to your trust. When you transfer title to the assets, you must have legal documentation properly filed and or recorded with the proper agency. If you miss something, or fail to record a deed, that asset will not pass to your heirs through the trust and will be subject to the probate process. For example, the cost to probate a asset worth $250,000 would be close to $12,000. This would include attorney’s fees, court filing fees, the posting of a bond and appraiser fees. An asset that is left out of the trust will have to pass through probate. This will cost money and take time to finalize the probate process. In addition, the asset (ie: stock account) will be frozen during this process. So if you have a stock that you would like to sell because it is selling at a high price, you cannot sell until the probate is final. Again, this may take 18 months, and during that time, the stock market may change and the price of your stock could fall. 2. THE TIME INVOLVED IN PREPARING A TRUST CAN BE UNLIMITED. Estate planning attorneys usually need about four to eight hours to properly prepare, execute and fund a living trust. The time needed by an individual that has not had the training to prepare a trust could be more than twenty hours. And there is no guarantee that the self-written trust was properly completed. It is no different than you driving down the road and the “check engine” light goes off and you pull off onto the side of the road. You know that you can try to diagnose the problem on your own or you can take the car to a well trained mechanic that will charge you a fee to fix the problem with your car. You may be able to discover and fix the problem on your own, but how long will it take? Will you do it right the first time. If you don’t do it right, who will you hurt by your mistakes? If you miss something in putting the trust together, you are only adding more time onto the project, because the trust will most likely be thrown into the probate court. Time is something we do not have an unlimited amount of. In my practice, I often am faced with having to probate a trust for a family that was prepared by a non-attorney or internet service. In probate court, judges do not like trusts that were not prepared by attorneys. I have had the opportunity to see how probate judges view trusts prepared by non-attorney’s and look for defects that will allow the trust to be invalidated. Again, if the trust is invalidated, the assets are subject to the probate process and more time is added to the botched estate plan. 3. THE TAX IMPLICATIONS OF IMPROPER ESTATE PLANNING. The internet services do not look at your net worth or entire estate to spot potential tax traps that could eat up your hard earned assets. A benefit of hiring an estate planning attorney to prepare your estate plan, they will advise you on what to do if your estate is subject to federal estate taxes. As of 2007, an estate worth over 2 million dollars will be taxed under the federal estate tax at rates of up to 49%. This means that, those assets that you have been taxed on during your lifetime, will be taxed again after you have died. If you make the right choices with trusts, gifting and insurance, you can eliminate and/or minimize these exorbitant taxes. I can assure you that an online service will not provide this valuable information to you. 4. THE PROPER SUCCESSORS CAN MAKE OR BREAK YOUR PLAN. When you go online to do estate planning, you are filling out a series of standard questions. One question is, “who do you want to be in charge of the distribution of the assets after you have died?” There is no discussion as to why you choose that particular person. As an attorney, I take a very active role in helping my clients decide on who is the right person or persons to act as the successor trustee. Is this person ethical? Does this person have a business or financial background? Do they have outstanding debts or creditors suing them? Do they cave into the pressure of others? Are they reliable? These are all very important questions to consider when choosing your successor. I was once hired to sue a successor trustee for the beneficiaries, because he was diverting monies from the trust to pay for his gambling losses. This lawsuit cost the beneficiaries tens of thousands of dollars because the wrong person was appointed as the trustee and the trust was written by a non-attorney. In my practice, I receive many calls each month from a disgruntled beneficiary that wants to sue the successor trustee for embezzlement of trust assets. An internet service does not spend the time counseling the client on the pitfalls of choosing the wrong successor trustee. Another important question and decision is how should assets be distributed to an eighteen year old beneficiary. A typical eighteen year old lacks the ability to invest assets and manage an estate. A properly drafted trust can avoid the assets being squandered by a young inexperienced beneficiary. By using an attorney and not the internet, you can rest assured that your hard earned assets will not be lost at the craps table in Las Vegas. Another issue that is typically missed on an internet trust application is what to do if a beneficiary is disabled or becomes disabled. Persons with disabilities can qualify for aid from the government if they have a limited amount of assets. If your beneficiary is disabled and then has an asset transferred to him or her via a trust, then that disabled person may no longer qualify for the state aid. In our client interview, there is always a discussion about the age, maturity, and mental capacity of your intended beneficiaries. I also should mention about looking out for the opportunistic gold digger {daughter-in-law/daughter-in-law}. These people are always discussed in our consultation. I have never seen an internet application that inquires as to whether you trust your son-in-law. 5. THE DUTIES AND LIABILITIES OF A TRUSTEE. By accepting the role of a trustee, that particular person is taking on responsibilities and potential liability if that trustee/successor trustee fails to follow state laws, the terms of the trust or does not pay creditors. The trustee can be sued in a court of law for failing to prepare the proper accounting documents on behalf of the trust. Non-attorneys and online services do not have court experience and do not have the insight on how to counsel clients on how to avoid these pitfalls. In my practice, I have the ability to share with clients the mistakes that I have seen made by others that were unrepresented and the consequences that were doled out due to those mistakes. For example, states provide statutes that define the duties and responsibilities of a trustee, if the trustee fails to act or acts negligently, the trust beneficiaries can sue the trustee for negligence. 6. WHO IS ACCOUNTABLE IF MISTAKES ARE MADE? When you use a website to write a trust and things do not turn out properly, you have little recourse in correcting the mistakes. You do not have a warranty. Even if the website offers a money back guarantee, a refund of $300 will not get you very far in the probate court. Attorneys are required to maintain good standing with the state bar and attend continuing legal education seminars on the recent changes in the law. Attorneys also typically carry malpractice insurance. I always let my clients know that I carry malpractice insurance and that they are covered if a mistake were made. In the planning stages of your estate plan and trust preparation it makes no sense to be penny wise and pound foolish. 7. ARE THERE ANY OTHER DOCUMENTS THAT NEED TO BE PREPARED? The living trust is usually not the only document that is needed to complete your estate plan. Every family has different needs and an in depth discussion is necessary to spot all of the legal issues. It is important to add durable powers of attorney for asset management, advance health care directives, pour-over wills, irrevocable life insurance trusts, and special needs trusts are other documents to be considered. To make this decision, the client needs full disclosure as to why these documents may be necessary. I also treat a client engagement as an opportunity to help educate that person on each of these documents and how they work and the importance of each tool. If I am not properly passing on my knowledge to my client, I am not doing my job. I enjoy helping people. That is why I became an attorney. It takes time to explain the importance of these estate planning tools. It is not fair to the client if they do not have a chance to explore all of their options. I have used these internet sites before, I have even owned my own internet site. The goal of owning an internet site is to be able to sell products or services without having to develop a working relationship with the customer. It is all about generating income without having to answer questions. In the area of estate planning, if your questions are not answered you are headed for failure. IDENTITY THEFT AND FRAUD One last parting thought is regarding the problems with identity theft and fraud. When you set up a trust, you must disclose information about you, and your assets. In today’s world of crimes being committed on the internet, it does not make sense to disclose your sensitive information to a company that you know nothing about. You do not know who the owner is and you never get to meet their staff. Would you give your birth date, social security number and the whereabouts of your assets to a perfect stranger? When using the internet to set up your trust, you will be required to disclose private information to people that you do not know. This in of itself is a scary proposition. I hope this information was helpful and encourages you protect yourself and those who are, or will be a part of your will or living trust. For information, please visit www.protectmyassets.com. 1. THE COST OF THE IMPROPERLY PREPARED TRUST. Many people are the do-it-yourself type. This is a nice approach if you have unlimited time and do not care if you have made the proper decisions in changing title to every asset that you have worked so hard to achieve. If your re-titling project goes awry, your heirs may be required to go to court to persuade a judge of what you really intended to happen after you have died. The internet services do not provide the service of re-titling your assets into your trust. A trust must have your assets funded or transferred to the trust for it to work properly. Assets have legal title, such as your home, money market accounts or stocks and bonds. The title to your assets must be changed over to your trust. When you transfer title to the assets, you must have legal documentation properly filed and or recorded with the proper agency. If you miss something, or fail to record a deed, that asset will not pass to your heirs through the trust and will be subject to the probate process. For example, the cost to probate a asset worth $250,000 would be close to $12,000. This would include attorney’s fees, court filing fees, the posting of a bond and appraiser fees. An asset that is left out of the trust will have to pass through probate. This will cost money and take time to finalize the probate process. In addition, the asset (ie: stock account) will be frozen during this process. So if you have a stock that you would like to sell because it is selling at a high price, you cannot sell until the probate is final. Again, this may take 18 months, and during that time, the stock market may change and the price of your stock could fall. 2. THE TIME INVOLVED IN PREPARING A TRUST CAN BE UNLIMITED. Estate planning attorneys usually need about four to eight hours to properly prepare, execute and fund a living trust. The time needed by an individual that has not had the training to prepare a trust could be more than twenty hours. And there is no guarantee that the self-written trust was properly completed. It is no different than you driving down the road and the “check engine” light goes off and you pull off onto the side of the road. You know that you can try to diagnose the problem on your own or you can take the car to a well trained mechanic that will charge you a fee to fix the problem with your car. You may be able to discover and fix the problem on your own, but how long will it take? Will you do it right the first time. If you don’t do it right, who will you hurt by your mistakes? If you miss something in putting the trust together, you are only adding more time onto the project, because the trust will most likely be thrown into the probate court. Time is something we do not have an unlimited amount of. In my practice, I often am faced with having to probate a trust for a family that was prepared by a non-attorney or internet service. In probate court, judges do not like trusts that were not prepared by attorneys. I have had the opportunity to see how probate judges view trusts prepared by non-attorney’s and look for defects that will allow the trust to be invalidated. Again, if the trust is invalidated, the assets are subject to the probate process and more time is added to the botched estate plan. 3. THE TAX IMPLICATIONS OF IMPROPER ESTATE PLANNING. The internet services do not look at your net worth or entire estate to spot potential tax traps that could eat up your hard earned assets. A benefit of hiring an estate planning attorney to prepare your estate plan, they will advise you on what to do if your estate is subject to federal estate taxes. As of 2007, an estate worth over 2 million dollars will be taxed under the federal estate tax at rates of up to 49%. This means that, those assets that you have been taxed on during your lifetime, will be taxed again after you have died. If you make the right choices with trusts, gifting and insurance, you can eliminate and/or minimize these exorbitant taxes. I can assure you that an online service will not provide this valuable information to you. 4. THE PROPER SUCCESSORS CAN MAKE OR BREAK YOUR PLAN. When you go online to do estate planning, you are filling out a series of standard questions. One question is, “who do you want to be in charge of the distribution of the assets after you have died?” There is no discussion as to why you choose that particular person. As an attorney, I take a very active role in helping my clients decide on who is the right person or persons to act as the successor trustee. Is this person ethical? Does this person have a business or financial background? Do they have outstanding debts or creditors suing them? Do they cave into the pressure of others? Are they reliable? These are all very important questions to consider when choosing your successor. I was once hired to sue a successor trustee for the beneficiaries, because he was diverting monies from the trust to pay for his gambling losses. This lawsuit cost the beneficiaries tens of thousands of dollars because the wrong person was appointed as the trustee and the trust was written by a non-attorney. In my practice, I receive many calls each month from a disgruntled beneficiary that wants to sue the successor trustee for embezzlement of trust assets. An internet service does not spend the time counseling the client on the pitfalls of choosing the wrong successor trustee. Another important question and decision is how should assets be distributed to an eighteen year old beneficiary. A typical eighteen year old lacks the ability to invest assets and manage an estate. A properly drafted trust can avoid the assets being squandered by a young inexperienced beneficiary. By using an attorney and not the internet, you can rest assured that your hard earned assets will not be lost at the craps table in Las Vegas. Another issue that is typically missed on an internet trust application is what to do if a beneficiary is disabled or becomes disabled. Persons with disabilities can qualify for aid from the government if they have a limited amount of assets. If your beneficiary is disabled and then has an asset transferred to him or her via a trust, then that disabled person may no longer qualify for the state aid. In our client interview, there is always a discussion about the age, maturity, and mental capacity of your intended beneficiaries. I also should mention about looking out for the opportunistic gold digger {daughter-in-law/daughter-in-law}. These people are always discussed in our consultation. I have never seen an internet application that inquires as to whether you trust your son-in-law. 5. THE DUTIES AND LIABILITIES OF A TRUSTEE. By accepting the role of a trustee, that particular person is taking on responsibilities and potential liability if that trustee/successor trustee fails to follow state laws, the terms of the trust or does not pay creditors. The trustee can be sued in a court of law for failing to prepare the proper accounting documents on behalf of the trust. Non-attorneys and online services do not have court experience and do not have the insight on how to counsel clients on how to avoid these pitfalls. In my practice, I have the ability to share with clients the mistakes that I have seen made by others that were unrepresented and the consequences that were doled out due to those mistakes. For example, states provide statutes that define the duties and responsibilities of a trustee, if the trustee fails to act or acts negligently, the trust beneficiaries can sue the trustee for negligence. 6. WHO IS ACCOUNTABLE IF MISTAKES ARE MADE? When you use a website to write a trust and things do not turn out properly, you have little recourse in correcting the mistakes. You do not have a warranty. Even if the website offers a money back guarantee, a refund of $300 will not get you very far in the probate court. Attorneys are required to maintain good standing with the state bar and attend continuing legal education seminars on the recent changes in the law. Attorneys also typically carry malpractice insurance. I always let my clients know that I carry malpractice insurance and that they are covered if a mistake were made. In the planning stages of your estate plan and trust preparation it makes no sense to be penny wise and pound foolish. 7. ARE THERE ANY OTHER DOCUMENTS THAT NEED TO BE PREPARED? The living trust is usually not the only document that is needed to complete your estate plan. Every family has different needs and an in depth discussion is necessary to spot all of the legal issues. It is important to add durable powers of attorney for asset management, advance health care directives, pour-over wills, irrevocable life insurance trusts, and special needs trusts are other documents to be considered. To make this decision, the client needs full disclosure as to why these documents may be necessary. I also treat a client engagement as an opportunity to help educate that person on each of these documents and how they work and the importance of each tool. If I am not properly passing on my knowledge to my client, I am not doing my job. I enjoy helping people. That is why I became an attorney. It takes time to explain the importance of these estate planning tools. It is not fair to the client if they do not have a chance to explore all of their options. I have used these internet sites before, I have even owned my own internet site. The goal of owning an internet site is to be able to sell products or services without having to develop a working relationship with the customer. It is all about generating income without having to answer questions. In the area of estate planning, if your questions are not answered you are headed for failure. IDENTITY THEFT AND FRAUD One last parting thought is regarding the problems with identity theft and fraud. When you set up a trust, you must disclose information about you, and your assets. In today’s world of crimes being committed on the internet, it does not make sense to disclose your sensitive information to a company that you know nothing about. You do not know who the owner is and you never get to meet their staff. Would you give your birth date, social security number and the whereabouts of your assets to a perfect stranger? When using the internet to set up your trust, you will be required to disclose private information to people that you do not know. This in of itself is a scary proposition. I hope this information was helpful and encourages you protect yourself and those who are, or will be a part of your will or living trust. For information, please visit www.protectmyassets.com. </style><p style="font-family: arial;"></p> Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-33100455131052963132009-02-13T11:42:00.000-08:002009-02-13T14:45:52.955-08:00Top 10 Reasons Business Owners Must Have A Relationship With An AttorneyDo you live in California? Do you own a business? Are you thinking of owning a business? Well here are <a href="http://protectmyassets.com/">protectmyassets.com's</a> Top 10 reasons building a relationship with an attorney are vital as a business owner!<br /><ol><li>They are operating their business without properly drafted written agreements containing safeguard to maximize their protection in the event of a dispute.<br /><br /></li><li>They remain unaware of the myriad of governmental regulations they are responsible for complying with and the consequences for failure to do so.<br /><br /></li><li>They do not realize that by <a href="http://en.wikipedia.org/wiki/Incorporation_%28business%29">incorporating</a> their business they eliminate personal liability exposure in the event of a lawsuit and gain tremendous tax advantages.<br /><br /></li><li>They are unaware of the vast number of employment laws they immediately become subject to upon hiring even one part-time employee.<br /><br /></li><li>They have no contractual agreements in force (e.g. <a href="http://en.wikipedia.org/wiki/Mediation">mediation</a> and <a href="http://en.wikipedia.org/wiki/Arbitration">arbitration</a>) to avoid drawn out litigation with its costly attorneys fees and potential for large jury verdicts.<br /><br /></li><li>No provisions are in place to address situations where a partner wants to leave the business or be bought out.<br /><br /></li><li>They may have misclassified workers as independent contractors instead of employees which can result in exorbitant penalties and interest.<br /><br /></li><li>No efforts have been made to prevent the theft or misappropriation of their company’s intellectual property (ideas, trademarks, trade secrets, copyrights, etc.)<br /><br /></li><li>They are unaware of the hidden pitfalls included in their office space leases that could, if they arise, substantially increase their cost or lead them into bankruptcy.<br /><br /></li><li>They lack a costs effective plan to collect their stale accounts receivables causing them to lose their hard-earned money.<br /></li></ol><br />Our Firm’s hands on involvement in the business decisions of our clients allows for the early identification and minimization of potential problems. Through implementing our legal and tax strategies, our clients have saved hundreds of thousands of dollars in costly decisions and litigation. Please feel free to contact us at our Orange County Attorneys office to schedule a private meeting.<br /><br /><div style="text-align: center;"><span style="font-weight: bold;"><span style="font-size:130%;"><span style="font-style: italic;">Contact Information</span></span><br />Phone: 877-246-2770</span><br /><span style="font-weight: bold;">Email: </span><a style="font-weight: bold;" href="mailto:info@protectmyassets.com">info@protectmyassets.com</a><br /><span style="font-weight: bold;">Web: </span><a style="font-weight: bold;" href="http://protectmyassets.com/">www.protectmyassets.com</a><br /></div><br />We hope this information was helpful! If you found this blog helpful, we encourage you to pass this on to friends, family and associates. Thank you!Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0tag:blogger.com,1999:blog-4993980624815107590.post-91648184711246841672009-02-13T10:40:00.000-08:002009-02-19T17:25:29.524-08:00Meet Matthew Mullhofer, Attorney At LawSince 1999, <a href="http://www.protectmyassests.com">Matthew C. Mullhofer of Protect My Assets</a> has been an attorney licensed by the State Bar of California and a member in good standing.<br /><br />He has extensive experience in the area of <a href="http://en.wikipedia.org/wiki/Estate_planning">estate planning</a> and <a href="http://en.wikipedia.org/wiki/Asset_protection">asset protectio</a>n, which includes the formation of trusts, wills, family limited partnerships, limited liability companies, and domestic corporations.<br /><br />Additionally, Mr. Mullhofer has formed numerous corporations, trusts, and private family limited partnerships. Mr. Mullhofer has been a featured speaker at many estate planning and asset protection seminars.<br /><br /><br />Matthew Mullhofer has extensive experience in business and <a href="http://en.wikipedia.org/wiki/Corporate_law">corporate law</a>, <a href="http://en.wikipedia.org/wiki/Civil_litigation">civil litigation</a>, <a href="http://en.wikipedia.org/wiki/Probate">probate</a>, and <a href="http://en.wikipedia.org/wiki/Real_estate_law">real estate law</a>. Matthew Mullhofer has negotiated many commercial and residential real estate leases and transactions. He has drafted and negotiated numerous business contacts and sale agreements for business owners. In the area of Intellectual Property, Mr. Mullhofer has acquired extensive experience representing corporations in the acquisition, licensing, and registration of their trademarks and copyrights.<br /><br /><br />Mr. Mullhofer has also experienced success in representation of taxpayers regarding collection efforts by the Internal Revenue Service, Franchise Tax Board, and State Board of Equalization. He also handles Chapter 7 Bankruptcy cases with an emphasis in discharging taxes in bankruptcy.<br /><br /><span style="font-weight: bold;">Courts</span><br />Mr. Mullhofer is admitted to practice before the <a href="http://www.courtinfo.ca.gov/courts/supreme/">Supreme Court of California</a>, the <a href="http://www.uscourts.gov/districtcourts.html">United States District Court</a>, and the <a href="http://www.uscourts.gov/districtcourts.html">United States Tax Court</a>.<br /><br /><span style="font-weight: bold;">Education</span><br />Mr. Mullhofer received a Juris Doctor Degree from Western State University, College of Law, emphasizing in estate planning and taxation. Mr. Mullhofer received a Bachelor of Arts Degree in Political Science and English minor from California State University at Chico.<br /><br /><br /><span style="font-weight: bold;">Professional Affiliations</span><br /><span style="letter-spacing: -0.15pt; font-size: 100%;"></span><a href="http://www.abanet.org/">American Bar Association</a><br /><span style="letter-spacing: -0.15pt; font-size: 100%;"></span><a href="http://www.calbar.ca.gov/state/calbar/calbar_home.jsp">The State Bar of California</a><br /><span style="letter-spacing: -0.15pt; font-size: 100%;"></span><a href="http://www.ocbar.org/">Orange County Bar Association</a><br /><span style="letter-spacing: -0.15pt; font-size: 100%;"></span><a href="http://www.longbeachbar.org/">Long Beach Barristers</a><br /><span style="letter-spacing: -0.15pt; font-size: 100%;"></span><a href="http://members.calbar.ca.gov/search/cert_detail.aspx?PID=2941&SpecCode=">South Orange County Bar Association</a>Matthew C Mullhofer (Matt Mullhofer Attorney)http://www.blogger.com/profile/14555810089559427062noreply@blogger.com0