The Lawyers of St. George » Utah

Spending Your Kids’ Inheritance – Part II

Russ Mitchell — Wed, 06 Jan 2010 18:13:21 +0000

This is the second of a three-part article designed to summarize various mechanisms by which you may pass property to your children or others to be used as an outline of possible options to discuss with your attorney or accountant and is not an exhaustive list. Please refer to my earlier posting, “Spending Your Kids’ Inheritance, Parts I,” for further introductory information.

POD (Payable on Death) Bank Accounts

You may wish to designate specific beneficiaries to receive funds in your bank accounts upon your death. This becomes a contractual relationship between you and the bank or financial institution that does not require court intervention (probate) or any other act by anyone in order for the beneficiaries to obtain the funds left in the accounts. Depending on the manner and amounts of deposited funds, this method may also have unexpected tax consequences. Although this does not carry with it the risks of joint tenancy (see earlier post), the funds in the account may become unavailable should you become incapacitated.

Life Insurance

You may choose to name beneficiaries on life insurance policies in certain proportion or on different policies in order to give specific benefits of certain amounts based on the amount of the policy in force. This is a contractual arrangement between you and the insurance company and does not require any court intervention (probate) in order for the life insurance benefit proceeds to be paid by the insurance company to the beneficiaries. Typically, an insurance company will make a payout to the beneficiaries within two to three months of your death once it receives notice. In some circumstances, a life insurance policy can provide the means for your beneficiaries to have adequate funds to meet certain estate tax obligations. One important point to consider in your planning is whether the beneficiaries named on life insurance are consistent with beneficiary designations you have made elsewhere. Inconsistencies on life insurance beneficiary forms may create confusion for your heirs as to what you intended to happen at death.

Will

A will is a document used to convey assets from one generation to another or to other people or charities. The will can give specific directions as to how bank accounts or other financial accounts, real property, or personal property are distributed after your death. In order for the will to be enforceable, it must be processed through a court in a procedure called probate. One of the key purposes of probate is having a person designated as the personal representative (aka executor) for your estate. The personal representative then has authority to act on behalf of the estate according to the provisions of the will to sign documents that otherwise would require your signature. The personal representative can then interact with financial institutions to transfer funds and assets as directed under the will. A probate procedure can have costs and expenses of a few thousand dollars to tens of thousands of dollars, depending on how the beneficiaries are getting along and how many assets are involved. All estate information, including the identity of beneficiaries, is part of the public filings in the probate proceedings in court. This includes identifying the total assets, their values, and to whom they were distributed under the terms of the will. Some people prefer privacy regarding their estate and seek to avoid probate where possible.

This article is not intended to be legal advice. Receipt of this information does not create an attorney-client relationship.

IRS CIRCULAR 230 DISCLOSURE: In order to comply with requirements imposed by the Internal Revenue Service, we inform you that any U.S. tax advice contained in, omitted from, or implied by this communication (including any attachments) is not intended to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.

Want Security? Think St. George, Utah

Marianne Sorensen — Wed, 02 Dec 2009 15:33:07 +0000

The Farmers Insurance Group of Companies has released its third annual ranking of top 20 “Most Secure U.S. Places to Live.” Based on factors such as crime statistics, unemployment rates, risk of environmental hazarads, terrorism threats, natural disasters and extreme weather conditions, the rankings put St. George, Utah as number one among the top 20 safest communities to live in the small town category.

St. George topped all small cities with populations of 150,000 or fewer in the survey. The city has 110,515 residents who enjoy a mild climate, clean air and low annual precipitation. It also has the lowest crime rates of all the 379 communities surveyed. St. George stands first in employment rate among the 138 small towns in the Farmers study.

Click this link for more from the Sacramento Bee:

http://sacramento10.cityspur.com/2009/11/24/where-are-the-safest-places-to-live-in-the-united-states/

Utah Exports to China Increase

admin — Wed, 21 Oct 2009 15:04:08 +0000

According to data provided by the World Trade Center, Utah in 2008 exported over $550 million of goods and services to the People’s Republic of China. This outbound trade to China is growing and will become much more profitable for Utah companies due to the emerging Chinese middle (consumer) class. Attached is a graph showing the tremendous growth over the past eight years in exports from Utah to the PRC - from a mere $33 million in 2000 to where it is today. This is an unprecedented trend. If the rate of growth continues, China will soon eclipse Canada and Mexico as our main foreign export partner.

To view chart, click here:

http://www.sglawblog.com/wp-content/uploads/2009/10/4432_0012.pdf

Utah’s Newest Export

Tim Anderson — Fri, 29 May 2009 00:16:56 +0000

Utah’s merchandise exports in 2007 were $7.8 billion. By the end of the 2008-2009 fiscal year that ends June 30, the number may exceed $14.0 billion. Key exports include electronics, computers, aircraft components and other commodities such as custom food items and heritage craft products. There are over 2500 companies involved in exporting, 85% of which are small or medium-sized enterprises with fewer than 500 employees. It is estimated that as many as 250,000 jobs in Utah are sustained by international exports. Approximately one out of every five manufacturing jobs in the state is an export industry job.

As Governor Jon Huntsman steps on to the world stage as the new U.S. Ambassador to China, he becomes Utah’s newest export. Given his ability to drive commerce to the State of Utah, even if it is done in his spare time, the State will richly benefit from his presence in China. He will likely inspire many new small businesses in Utah to move on to the world stage as well and become part of this emerging sector of opportunity.

Utah – Happiest State in the US?

Marianne Sorensen — Thu, 12 Mar 2009 23:43:07 +0000

MSN.com (content provided by Forbes.com) reports that in a recent survey by Gallup, Utah earned the highest marks for being a happy place to live, being rated on factors such as residents enjoying their jobs, deep optimism about future prospects and staying healthy. Hawaii ranked second, followed by Wyoming, Colorado and Minnesota. West Virginia ranked last, and manufacturing-reliant states like Michigan and Ohio also landed in the bottom 10.

The article states that one major factor for Utah’s strong performance might be its unemployment rate: When last reported in January, it was 4.6 percent, compared to a national rate of 7.6 percent.

What do you think makes Utah such a happy place?

To read the full article, go to http://health.msn.com/health-topics/articlepage.aspx?cp-documentid=100234481>1=31036