Please note: Due to the outbreak of the Coronavirus and COVID-19 and based on the mandate from California’s elected officials and state government, all seminars and events formally organized by The Teresa Rhyne Law Group are postponed until a later date. We apologize for any inconvenience.
May 23rd, 2021
The ease of legalease: What to know about legal terms
By Teresa J. Rhyne
All occupations have their own industry-speak, and lawyers may be among the biggest offenders.
In our defense, some of the language of the law is in fact Latin. But understanding the terminology is important when it comes to knowing what documents you need in place and what is necessary to accomplish your estate planning goals.
To read the full article, please click here.
April 17th, 2021
Who are the team players in your financial game?
By Teresa J. Rhyne
Which is your favorite team?
Whether you said Angels or Dodgers, Ducks or Kings, I hope your next thought was, “but I really love my team of financial and business advisers, too.”
Our uniforms aren’t as colorful, and we rarely serve hot dogs or peanuts, but if you’ve got a financial planner, an accountant and an attorney working collaboratively toward your goals, you’re ahead in the game. And you’ve got a team that’s rooting for you, which is a nice twist.
To read the full article, please click here.
April 12th, 2021
Column: Legal lessons from a pandemic
By Teresa J. Rhyne
I have been one of the lucky ones since the pandemic hit in March of last year. My loved ones are healthy, and my law practice is busier than ever. But I see the havoc Covid-19 has caused—I see it in my clients every day. I feel it myself sometimes, too.
It’s a sense of unease, of unknowing, and, perhaps most significantly, of a lack of control. It’s hard to plan for next week, let alone the future, when our environment, the advice from the experts, and indeed the outbreak itself, seems to change on a daily basis. There’s a vaccine now. Can we take a vacation? Can we see our loved ones? And if not now, when?
To read the full article, please click here.
March 21st, 2021
In marriage we trust: Why having an estate plan is a must
By Teresa J. Rhyne
I have frequently heard from couples who put off estate planning because they couldn’t agree on a plan. I usually say this is the same as not going to the doctor because you haven’t diagnosed yourself.
An estate planning attorney’s job is to guide you through the options available and the techniques that can be used to meet the goals you both have, even if those goals may seem to conflict. There are always options. Here are some …
To read the full article, please click here.
February 20th, 2021
Family money: Trusts, taxes and how to plan lifetime gifts
By Teresa J. Rhyne
Warren Buffett said that the perfect inheritance is enough money so that children feel they can do anything, but not so much that they could do nothing. This is pithy advice.
How much inheritance that amounts to, when to give it, and how, is the real crux of the matter for most families.
To read the full article, please click here.
January 15th, 2021
Prop. 19: What’s next for homeowners and their children?
By Teresa J. Rhyne
As discussed in previous columns, Proposition 19 has arrived like a Trojan horse. When the citizens of California let the Prop. 19 horse in, they believed they were voting to allow homeowners 55 and older, disabled, or victims of disasters, to transfer their property tax base value from one home to the next throughout California.
Many have been shocked to learn that in the belly of that wooden horse was a law preventing parents, in all but the narrowest of circumstances, from passing their real estate to their children free from property tax reassessment.
What can you do before Feb. 16, 2021, to keep the horse out of your living room?
Any decision you make requires an analysis of property, income and estate taxes. Unfortunately, there are no easy answers.
To read the full article, please click here.
January 11th, 2021
Teresa’s Prop. 19 Presentation before the Santa Monica NE Neighbors Association
Click here to play
January 8th, 2021
Prop. 19: How property transfers to children changes Feb. 16
By Teresa J. Rhyne
In mid-December, the state’s Board of Equalization issued both a letter to assessors and a chart of issues raised and options regarding Proposition 19.
In light of this guidance, my last column discussed the changes to a homeowner’s ability to transfer their property tax base value from one home to another brought about by the passage of Prop. 19. That was mostly good news, dampened only by the lack of clarity on some issues.
This column will further discuss the change in the property tax reassessment exclusion that applies to transfers of property between parents and children, effective Feb. 16, 2021.
To read the full article, please click here.
January 1st, 2021
Prop. 19: State offers guidance on new property tax transfer law
By Teresa J. Rhyne
The danger with ballot propositions is that they are sometimes poorly written and often misunderstood by the voters. Proposition 19 appears to be no exception to the rule.
I previously wrote about Prop. 19 in a column on Dec. 13. This column is a continuation and is the first of a three-part series.
To read the full article, please click here.
December 13th, 2020/January 2nd, 2021
California’s Prop 19 Gives and Takes
By Teresa J. Rhyne
California’s Proposition 19, billed as “The Property Tax Transfers, Exemptions, and Revenue for Wildfire Agencies and Counties Amendment,” passed with a 51.1 percent vote in favor in November. As a result, 2021 will see sweeping changes in property taxes assessed on personal residences and properties passed between parents and children. There’s good and bad news.
To read the full article, please click here.
November 15th, 2020
Is it time to switch IRA to QCD to save at tax time?
By Teresa J. Rhyne
As we’ve discussed this month, COVID-19 and the accompanying shutdowns have significantly impacted charities’ bottom lines. At the same time, the Secure Act, enacted in late 2019 ostensibly to make saving for retirement more attainable, dealt a blow to many persons with large retirement accounts who intended to pass those benefits down to their children as a reliable tax-favored income source.
The Secure Act did away with the rules that allowed most beneficiaries of inherited IRAs to “stretch” out the required distributions over their lifetime. Instead, inherited IRAs must be distributed, and thus income taxes paid by the beneficiary, over a maximum 10-year period. The beneficiary quickly loses the benefit of income accruing tax-free. This is true for all beneficiaries except a spouse, a disabled beneficiary, a minor child, or a beneficiary less than 10 years younger than the original IRA owner. Thus, IRAs, once a tax-favored asset, are now a tax-challenged asset for some.
What’s the solution? Qualified charitable distributions may solve the problem for these individuals and the charities they support.
To read the full article, please click here.
October 18th, 2020
Legal lessons from a pandemic: What you can plan for
By Teresa J. Rhyne
I have been one of the lucky ones since the pandemic hit in March of this year. My loved ones are healthy, and my law practice is busier than ever. But I see the havoc COVID-19 has caused—I see it in my clients every day. I feel it myself sometimes, too.
It’s a sense of unease, of unknowing, and, perhaps most significantly, of a lack of control. It’s hard to plan for next week, let alone the future, when our environment, the advice from the experts, and indeed the outbreak itself, seems to change on a daily basis. Can we take a vacation? Does it make sense to have a family gathering for the holidays? And if not now, when?
To read the full article, please click here.
September 13th, 2020
Aging family members: Mental competency and the courts
By Teresa J. Rhyne
Losing mental competency is something everyone worries about as they age. It’s also something most children worry about on behalf of their parents.
Cognitive impairment can have a significant impact on one’s life and the lives of family members. So, it’s essential to plan for the possibility and assure appropriate documents are in place. But it’s also important to know when a power of attorney or change in trustee may be activated as a result of a person’s diminished mental capacity and what that does and doesn’t mean.
The process isn’t as straightforward as many think.
To read the full article, please click here.
August 16th, 2020
Won or inherited lots of money? Beware the pitfalls and losing it fast
By Teresa J. Rhyne
We all dream about winning the lottery or getting some unexpected prize or inheritance that suddenly changes our life. But are you prepared for such a happening?
And if you have children or other heirs that you will be leaving an inheritance to, are they ready? Receiving an inheritance can be like winning the lottery. In both cases, without careful planning, the windfall may not change lives for the better.
To read the full article, please click here.
July 19th, 2020
Planning ahead for incapacity helps you and family
By Teresa J. Rhyne
One in four American adults live with a disability, according to the Center for Disease Control. One in 10 adults over the age of 65 has Alzheimer’s or dementia, according to the Alzheimer’s Association.
With numbers like that, we should all be planning for the possibility of our incapacity to handle our day-to-day lives.
To read the full article, please click here.
June 20th, 2020
Pandemic’s silver lining: Updating your paperwork as a divorce looms
By Teresa J. Rhyne
For the past three months, since the pandemic began, my office has been busier than usual with calls from past clients wanting to update their estate planning documents or new clients needing to get their estate planning done for the first time.
Whether this was a result of people having more time on their hands, or the pandemic bringing our mortality front of mind, I don’t know. I do know it’s one of the silver linings to this pandemic.
Estate planning documents are not static documents — it’s not a “one and done” transaction. Wills, trusts, powers of attorney and health care directives are dynamic. They should change as often as your life does. One of the most important times one should review and revise (or implement) estate planning documents is in the event of a divorce.
Let’s take a look at what should be revised and when in the context of a divorce.
To read the full article, please click here.
May 23rd, 2020
Low interest rates present opportunities for your estate trusts
By Teresa J. Rhyne
Last week we discussed some opportunities and incentives presented by The Coronavirus Aid, Relief and Economic Security Act (CARES) passed by Congress in late March 2020. This week we’ll focus on some opportunities presented by the historically low-interest rates that now exist.
To read the full article, please click here.
May 17th, 2020
New limits on IRAs lead to other opportunities, incentives
By Teresa J. Rhyne
As discussed in last week’s column, the Secure Act passed in December 2019 made some changes to IRAs that were not beneficial to those people hoping to pass their IRAs down to their heirs in a tax-efficient manner.
The opportunity to stretch distributions from an IRA over a beneficiary’s lifetime (and therefore accrue tax-free income inside the trust for a longer period) was effectively done away with for all but spouses.
Then along came COVID-19 and the never-before-seen hit to the economy.
But things aren’t all bad. The Cares Act, passed by Congress in late March 2020, presents some tax planning incentives and opportunities, ranging from the simple to the more complex with greater benefits.
To read the full article, please click here.
April 13th, 2020
What you need to know about legal documents amid coronavirus pandemic
By Teresa J. Rhyne
Given the state of the world, and perhaps with some free time on your hands, your thoughts may have turned to getting your affairs in order. The current pandemic emphasizes just how important that is.
But what does that mean in these emergency times, and how can you get these documents in place currently?
To read the full article, please click here.
February 2nd, 2020
Yes, you must go there: Think about the unthinkable, plan for the worst
By Teresa J. Rhyne
Every January, my law office sees an increase in appointments from clients who have made a New Year’s resolution to finally get their financial affairs in order, including their estate plan. And that’s a good thing since everyone needs a plan for the “what ifs” and we never know when we’ll need the plan in place.
As I write this, news has broken of the tragic death of Kobe Bryant, his young daughter, and seven others. The retired NBA star was only 41 years old.
Have you resolved to get your estate planning done at last or perhaps updated? Good for you. Here’s what you’ll need to do, and, just as importantly, what you don’t need to do.
To read the full article, please click here.
December 28th, 2019
Nonprofit boards and your personal liability
By Teresa J. Rhyne
In our last two columns you’ve read about some of the responsibilities of a director on a nonprofit’s board. You may now be thinking, “But why? I’m a volunteer!”
And so enters the lawyer to tell you why in two words: personal liability.
When is a board member liable?
While a board member is a volunteer and afforded substantial protection by law, when duties to the organization are violated (whether through acts or omissions), when certain taxes aren’t paid (notably, payroll taxes), or when a board member engages in self-dealing transactions with the organization or allows others to do so, personal liability may arise.
What are their legal duties?
A nonprofit board member, sometimes called a “trustee,” is a fiduciary — a person who must act for the benefit of another. In this case, a board member is charged with acting for the benefit of the public. It is a serious duty, and a breach of the duties can result in both personal liability and the loss of the entity’s tax exemption.
So what are those duties? In general, a board member owes the duties of care and loyalty.
To read the full article, please click here.
November 23rd, 2019
Beware the federal “Grinch” during the season of giving
By Teresa J. Rhyne
It’s officially the holiday shopping season. But be wary. Your Grinch neighbor, the IRS, is sitting high on the mountain, waiting to pounce. When money or items of value change hands, the IRS often wants a share, and believe it or not, it includes gift-giving.
The basic rules
A recipient of a gift does not pay income taxes on the gift. But the donor may pay gift or estate taxes. These taxes work together but are two different taxes, separate and apart from income taxes. A gift tax applies to gifts made during your lifetime, paid by the donor and not the recipient.
Estate tax applies to transfers at your death, paid by the decedent’s estate, not the recipient. There is one tax exemption for both these taxes. Currently, the exemption is $11.4 million, so you can give that amount away during your life or at your death, or some combination thereof, without gift or estate taxes.
Additionally, anyone can give another person a gift of up to $15,000 a year. That means spouses can together gift $30,000 per year. After that, the gift is subject to gift tax and you’ll need to use part of your exemption.
To read the full article, please click here.
October 12th, 2019
Heirs of omission: Who’s in, and not in, a will
By Teresa J. Rhyne
These past few weeks we’ve been discussing “omissions” (you can decide whether these are errors or sins). As an estate planning attorney, I instantly think of “omitted heirs.” And you may think, “huh?”
An omitted heir is a person who would have inherited by law but was not mentioned in a will or trust. A related concept is “pre-termitted heir”– someone who was born to, adopted by, or married to the deceased after the date of the will. Both situations have legal consequences, which may or may not have been intended.
Occasionally, I meet with a client who intends to disinherit a child. We always state that clearly and upfront in the will with a statement such as “I have intentionally not provided for my child Badly Behaving Bob and for all purposes hereunder he is to be treated as having predeceased me,” and sometimes we add “leaving no issue” if the client also wishes to disinherit any of Bob’s children (and let’s face it, if the behavior was bad enough those grandchildren could be sprinkled across the globe). This can make clients uncomfortable. But there is a reason for it.
To read the full article, please click here.
September 7th, 2019
The most common mistakes made in estate planning
By Teresa J. Rhyne
“Mistakes were made” is practically the family motto in my household. But when mistakes are made in estate planning the results can be, well, if not deadly, certainly detrimental to loved ones.
The most common mistakes
The most common mistake in estate planning is not planning at all.
Some folks mistakenly believe that only the wealthy need wills or trusts. That choice can backfire quickly. In California, if you die without a will or a trust, the state steps in to determine your heirs. The state knows nothing about you and has to assume certain facts — which may not work for you at all.
For example, if you’re married, you might assume your spouse would inherit everything. But that is not the case if you have separate property (including anything you inherited) and one or more children. Community property all goes to a spouse, but separate property gets divided between a spouse and children — even very young children.
Not having a health care directive or power of attorney can force your loved ones into a court proceeding to take care of you in the event of incapacity, and can also result in a person you would never have chosen becoming your conservator.
Choosing not to plan is a choice to leave it up to the state of California to sort out your affairs. That choice is sure to backfire.
To read the full article, please click here.
August 3rd, 2019
An estate planning lawyer’s approach to blended families
By Teresa J. Rhyne
This is part three in a series of five articles discussing the following case hypothetical from the various professional perspectives:
A and B are getting married. A has two kids from a previous marriage. B has one child from a prior marriage. They plan to have children together. A receives child support from a former spouse. A’s mother also lives with them and helps care for the children. B’s only child works in B’s business and both A and B hope their joint child(ren) will one day join the business as well. A and B have a lot to discuss!
The first thing I would tell A and B about their estate planning is “don’t try to plan for the next 20 years right now.” Trying to plan for too many “what ifs” can cause analysis paralysis. The best practice is to get a plan in place that addresses the “what ifs” of the next three to five years. That’s particularly true for A and B — newlyweds with a newly blended family. That’s why trusts are living documents — they need to be reviewed and adjusted over time as families, circumstances and laws change.
As long as you remain competent and alive, you can amend your trust. And if you don’t, well, you’ve put the right plan in place at the right time.
To read the full article, please click here.
June 22nd, 2019
Family secrets: Which to keep and others to share
By Teresa J. Rhyne
Family secrets, every family has them. But should your estate plan be one of those secrets?
In my law practice, I am often asked by parents if they should provide a copy of their estate planning documents to their adult child(ren), or at least discuss the plan with them. And the typical lawyer answer I give is “it depends.” And it does.
It depends on the ages of those folks; whether you’re likely to make significant changes in the future; if there is anything unusual in your plan; whether anyone is being disinherited or inheriting less than what they might expect; and your relationship with the heirs and beneficiaries in general.
There are, however, some general rules.
To read the full article, please click here.
May 18th, 2019
Trusts, wills and the family pet: When your family’s not like everybody else’s
By Teresa J. Rhyne
After more than 30 years practicing law, most of those in estate planning, I can tell you there is no such thing as a “traditional” family.
Every family is unique, and every family has its issues. But California’s legislature had to base their Probate Code on something, so they chose the fiction of a traditional family. Built into the Probate Code is a presumption of mom, dad, and children from that same mom and dad. Oh, and they all get along.
That means if you don’t plan for your very specific family, you or your loved ones may be in for some terrible surprises. Without your own wishes set out in a will or a trust, California steps in and directs the distribution of your estate and who can speak on your behalf in the event of your incapacity.
Let’s look at how that pencils out…
To read the full article, please click here.
April 12th, 2019
Your lawyer is unreal: How to spot the scammers
By Teresa J. Rhyne
Shakespeare once wrote, “First, let’s kill all the lawyers.” And you can insert any of hundreds of lawyer jokes here. (Here’s one: What do you throw to a drowning lawyer? A: His partners.) So why would anybody want to pretend to be a lawyer? It happens, all too frequently, in many guises.
Here are a few to watch out for…
To read the full article, please click here.
March 9th, 2019
While you spring forward, look backward at your estate plan; it likely needs an update
By Teresa J. Rhyne
Your clocks are springing forward, but it’s time for you to look backward. If you are part of the 40 percent of Americans who’ve completed estate planning, congratulations. But you’ve got more work to do.
Estate planning is not a “set it and forget it” task. It’s an ongoing process. Your family changes, circumstances change, and the laws change.
Lately, we’ve seen some big changes in the laws affecting estate plans as well. I’ve also seen many unintended consequences when administering outdated trusts under the new laws.
To read the full article, please click here.
February 9th, 2019
Fees? Online referrals? Here are some tips to find the right lawyer
By Teresa J. Rhyne
Lawyers don’t know everything.
Wait, what? Sure, we pretend to at family dinners, but that’s different.
The truth is in modern times no one lawyer can know every area of law. Think about it — the tax code alone is a gaztrillion pages long (that’s a legal term). How could we know and understand that along with the California Family Law code, which is a modzillion pages (legalese again, sorry)? That’s why we specialize in one, maybe two or three related areas of law. And that’s why you should be careful and methodical in choosing your attorney.
To read the full article, please click here.