LEGAL CLARITY: Adult Adoption

  • December 5, 2016

This article originally appeared in Incline Law Group’s Legal Clarity column, which is published monthly in the Sierra Sun North Lake Tahoe Bonanza.

Many people do not realize that there is a procedure available for the adoption of adults. There are several reasons that make adult adoption worth exploring.

Adult AdoptionIn the age we live, divorce is common and children are often raised by stepparents or other individuals who are not their natural parents, playing an important de facto parent role in a child’s life.

During the child’s minority (e.g. up to age 18), it is not possible to adopt a child without the consent of the child’s natural parent, or grounds to terminate the relationship between the child and its natural parent.

Nevertheless, the de facto parent may establish very close bonds with a child and desire to legally solidify the nature of their relationship, even if it is after the child has grown. Once the child turns 18, the adult adoption process is a wonderful opportunity to do this.

Adult adoptions provide a means to legally recognize the relationship and to secure inheritance and other rights for the child from the stepparent. Even if a stepchild has been raised in a stepparent’s home for their entire life, the adult stepchild would not be eligible to inherit by intestacy from a deceased stepparent.

The adult adoption is the perfect remedy for this type of circumstance. It is important to note that the adult adoption does not have any impact on the relationship between the child and his natural parent and does not preclude the child from inheriting from his natural parent through the laws of intestacy as well.

Adult adoptions can also assist in aiding a young person to legally immigrate to the United States. It bears mentioning that the best time to accomplish the adoption would be before the child reaches the age of 16. However, even if the child has already reached the age of majority, the adult adoption is another factor that may assist the person’s ability to achieve legal immigration.

The adult adoption procedure is very simple and does not involve much in terms of time or money. There is rarely a home study or investigation by a social worker required and there is only a small amount of court filings necessary.

Only one court appearance (which can even be waived under certain circumstances) is required by statute. It is always important to be vigilant in reviewing your estate plan to determine areas which need improvement. If you have been part of a blended family, adult adoption may provide a component, which may be currently lacking in your estate plan.

Most importantly, it has the effect of not only enhancing and legitimizing the bonds of a blended family, but also providing for much needed security to stepchildren after they have grown.

7 Tips to Ready Your Business for 2017

  • November 23, 2016

Hard to believe that another new year is just around the corner.  Whether you are thinking about end of year organization or New
7 tips to ready your business for 2017Year’s business resolutions, here are  seven tips for readying your business for 2017:

  • Charitable Giving: Business or personal, charitable giving is not only a tax deductible event it is always better to give than to receive. There are many local non-profits that could especially use your help this time of year. Consider funding a Thanksgiving meal for a family, donating a warm coat or even volunteering some hours.
  • Estate Planning: When is the last time you updated your estate plan? Do you need to accomplish any year end gifting? It is advisable to review you estate plan at least every 5 years and depending on your circumstances more often.
  • Tax Planning: This is the time to call your CPA and discuss any over or under payments for 2016, year-end purchases and retirement account contributions.
  • Business Registrations: Have you renewed all required registrations, licenses and filed all required tax returns?  Business registration renewals of all types should be calendared. If Incline Law Group, LLP serves as your registered agent, we will track your annual business registration and state business license renewal for you.
  • Insurance: As long as the Affordable Care Act (“Obamacare”) remains in place, there is an open enrollment period which runs November 1, 2016 through February 1, 2017. Your employee health insurance plan is now likely to have a year-end renewal date regardless of when you used to renew. Now is the time to renew or shop for new policies.
  • Leases: Commercial leases often run for longer periods of time and new leases or renewals can often take some time to complete. If your lease is expiring in 2017, now is the time to start planning for that.
  • Employment Policies: January 1 is a great time to put new policies in place for employees in place, especially ones that address newer issues like medical marijuana in the work place and privacy issues. You do want to be sure that your employment practices and policies are compliant with state and federal employment law.  Please be sure to consult with your attorney before putting new employment policies in place.
This article was originally published in the Sierra Sun/Tahoe Bonanza in Incline Law Group’s monthly opinion column, Legal Clarity.

What If My Relative Died Without a Will? (Intestate Succession)

  • May 3, 2016

If a person dies without a will or a trust, their real and personal property passes through a process known as intestate succession. Intestate succession provides a distribution to the living heirs of the decedent pursuant to the statute in the state where the decedent was a resident when s/he passed away. If the descendant left real property in another state, the intestate succession laws of that state will govern the disposition of that property.

When someone dies without a will, the estate will still have to go through a legal process. This will require filing the proper pleadings with the court in the appropriate jurisdiction. Instead of appointing an executor of the will, the court will appoint an administrator of the estate. Similar to an executor, an administrator has a fiduciary duty to act in the best interest of the estate.

The process for intestate succession follows almost exactly the same process as a probate. Depending on the estimated value of the estate, there may need to be a notice to creditors, an inventory and appraisement of value, as well as many other formalities to process the estate so that it can be properly distributed to the rightful heirs.

If you need assistance gaining legal clarity for an intestate succession, please feel free to call the attorneys at Incline Law Group.

Does a Will Cover Assets in Two States?

  • May 3, 2016

As an attorney, people often ask me what to do if a relative who had a Last Will and Testament passes away, but leaves property in more than one state.

Based on our geographic area in Lake Tahoe, it is very common for our clients and their relatives to have property in both California and Nevada. In cases such as these,California and Nevada State Line in Lake Tahoe there will usually need to be two separate probates completed. The first probate is done in the state where the decedent resided at the time of death. In this initial probate, all of the real property in that state, as well as all personal property located in any state will be probated. If there is real property in another state, a second “ancillary” probate is processed. Ancillary probates are similar to an ordinary probate but they do have some intricacies. Many times, there is only one piece of real property in another state. Depending on the value of that real property, this may allow for a shorter, more expedited ancillary probate than would otherwise be available.

Many prefer to substantially complete the probate in the home state before starting the ancillary probates. However, ancillary probates may be done concurrently with the home state probate in order to expedite the distribution of the entire estate of the decedent. As with an ordinary probate, ancillary probates are required to transfer title to any real property in any state that is not the home state of the decedent.

The attorneys at Incline Law Group are licensed in both Nevada and California and can assist with a home state or ancillary probate.

What is Probate and Why Do You Need It?

  • May 3, 2016

Probate is the legal process whereby a will is “proved” in a court and accepted as a valid public document that is the true last testament of the deceased.  The probate process varies by state and by the size of the estate of the deceased person.  In both California and Nevada, there are specific laws and defined processes for the appointment of an executor of the will and the distribution of assets to heirs.  The executor is the person who handles the affairs of the estate throughout the probate process and who ultimately distributes the property according to the terms of the will.

An attorney is not required in a probate proceeding.  However, an attorney can certainly be beneficial to an executor, especially in more complex probates. It is important that certain steps be taken in a particular order to comply with the various probate statutes. An attorney can help navigate this process which may save the estate money. Since the executor of an estate is considered a fiduciary, the executor may become liable to the beneficiaries if s/he attempts to probate the will of his/her own and ends up doing so improperly or spending extra money on steps that did not need to be taken.

The attorneys at Incline Law Group are available to assist you with probate proceedings for estates of all sizes.

Avoiding Probate in Nevada and California with a Heggstad Petition

  • April 19, 2016

The use of revocable inter vivos trusts, also known as living trusts have gained in popularity. A wide range of estate, tax and wealth planning objectives can be achieved by the use of living trusts. A primary objective of the living trust is the avoidance of probate.

Problems can arise, however, when a trust is created but assets are not transferred into the trust, whether inadvertently or because of an ineffective transfer document. When real estate assets are inadvertently not transferred to the trustee of the trust, it may still be possible to avoid a lengthy and expensive probate.

Heggstad PetitionUnder California law, a trust can be created by a written declaration by the owner that the real property in question is held subject to a trust, and no separate transfer by deed is required to fund the real property into the trust. (Estate of Heggstad (1993) 16 Cal. App. 4th 945.) This ruling provides an opportunity to have a court declare real property to be subject to a trust through the filing of a petition that has become known as a “Heggstad petition”. A successful Heggstad petition can allow the parties to avoid a more lengthy and costly probate proceeding.

Several provisions in the Nevada Revised Statutes (NRS) dating back to 1999 authorize a Heggstad-like petition in Nevada. The most recent addition to the NRS in this regard was enacted by the 2015 Nevada Legislature in Senate Bill 484, Section 64. The new amendment of NRS 164.015 confers additional explicit authority upon the Nevada District Courts in cases involving non-testamentary trusts to hear and act upon “petitions for a ruling that property not formally titled in the name of a trust or its trustee constitutes trust property…”

For more information on California or Nevada probate, and the possibility of avoiding probate, the attorneys at Incline Law Group, LLP may be able to assist.

New Probate Laws in Effect as of October 1, 2015

  • October 1, 2015

The Nevada Legislature has enacted new laws to streamline the probate process for small estates beginning October 1, 2015. These new probate laws will allow executors and administrators of qualifying estates to expedite the probate process and cut down on costs to the estate. probate (1)

Previously, NRS 146.080 allowed a claimant to avoid probate if the estate did not include real property and the value of the estate was less than twenty thousand dollars ($20,000.00) by preparing an affidavit in lieu of filing a petition with the probate court. AB 130 amended NRS 146.080 to increase the affidavit limit to twenty five thousand dollars ($25,000.00) for all claimants except the surviving spouse. If the claimant is the surviving spouse, the affidavit limit increased to one hundred thousand dollars ($100,000.00). Additionally, motor vehicles no longer have to be included in the calculation of the size of the estate. This new law will help decrease the costs of administering an estate for those Nevadans that qualify because they will no longer be required file a petition with the court saving attorney’s fees and costs.

The Nevada Legislature also amended NRS 145.040 by increasing the limit for Summary Administration from $200,000 to $300,000. Summary Administration allows for shorter notice periods to creditors and an expedited probate process. Now that expedited process will be available for those estates under $300,000.

These are just some of the changes to probate and estate law made by the Nevada Legislature that went into effect on October 1, 2015. If you have questions or are confused about any of the new probate laws, do not hesitate to contact Incline Law Group to help provide you with legal clarity.

IS YOUR INHERITED IRA PROTECTED FROM CREDITORS?

  • July 20, 2014

By John C. Rogers, Attorney, Incline Law Group

This question is important to those who receive an IRA as a beneficiary, but more important to those who plan to pass an IRA to children or other beneficiaries. The latter have the opportunity to plan so that the inherited IRA includes protection from creditors.

In a recent landmark decision, the U.S. Supreme Court held that an inherited IRA does not qualify for the “retirement funds” exemption under the bankruptcy code Clark v. Rameker, 573 U.S. ___ (2014).

In that case, IRA beneficiaries filed for Chapter 7 bankruptcy protection and claimed about $300,000 in an inherited individual IRA as exempt “retirement funds.” (See 11 U. S. C. Sec. 522(b)(3)(C).)

The court decided that funds in an inherited IRA were not “retirement funds” intended to be protected by the exemption.

The court pointed to three legal characteristics of inherited IRAs that clearly distinguished them from protected “retirement funds.” (1) Inherited IRAs can never be increased by contributions from the inheriting holder. (2) Holders of an inherited IRA must withdraw funds from the account no matter how far they are away from retirement. And finally, (3) the holder may withdraw the entire balance of the account at any time, for any purpose, without penalty.

The policies that allow original IRA holders to exempt “retirement funds” from the reach or creditors help assure that IRA funds will be available to fund necessities during retirement years. Because of the distinguishing characteristics described above, an inherited IRA operates in opposition to those policies.

If you are the holder of an IRA and you anticipate naming children or others as beneficiaries, and if you want to provide creditor protection for those beneficiaries, there are a number of mechanisms that may achieve this goal.

If you already hold an inherited IRA, you may want to consult with an attorney regarding the pros and cons of liquidating that IRA and investing in other protected assets.