Transfer on Death Instrument or Living Trust – Which One Should You Use?

Wheaton wills and trusts lawyersHistorically, estate planning has been overlooked by the non-wealthy. Times are changing, however. Retirees and even younger adults are starting to recognize the benefits of an effective estate plan – especially when there is a smaller estate. You see, probate can quickly eat away at the value of a moderate estate, which may lead to significant losses for beneficiaries. In situations where the only transferable item is real estate, the loss may even prevent the procurement of the asset.

Thankfully, there are some preventative strategies that you can use, including Transfer on Death Instruments (TODI) and living trusts. How do you decide which is most appropriate for your situation? The following explores these two solutions and explains where to find assistance with your Illinois estate planning needs.

Living Trusts

Revocable trusts (otherwise known as living trusts) are legal documents that authorize a trustee (beneficiary) to hold and manage the grantor’s assets before death. This authorization can be extremely beneficial for those suffering from a degenerative brain disease, or someone that is at risk for incapacitation. However, it can be used by anyone to avoid probate upon their death. It should also be noted that grantors still own their funds until death, and they can alter or revoke a living trust at any time (provided they are of sound mind).

Unfortunately, there are some limitations and concerns with living trusts. They must be funded, so they can be expensive to set up. It should also be noted that a single mistake – even a minor one – can invalidate the trust and cause the estate to go to probate. Living trusts do not replace a will either, and there may be confusion about what should go in a will and what should be designated to the trust.

Transfer on Death Instrument

A TODI deals only with the transfer of real estate, so it is not a comprehensive estate plan. However, they are less complex (and often less expensive) than a living trust, and they can still be altered or revoked (with a few exclusions). Still, there are some limitations and exclusions that one must be aware of before setting up a Transfer on Death Instrument. For example, a TODI can only be signed by someone of sound mind who is not under duress. A TODI must also comply with all deed requirements, and it must be registered in the county or counties where the property is located.

Contact Our DuPage County Estate Planning Lawyers

Because each situation is unique, it is crucial that estate planners seek experienced legal assistance before moving forward. The skilled DuPage County estate planning lawyers at Stock, Carlson, Oldfield & McGrath, LLC can help. Knowledgeable and dedicated to protecting your best interests and the interests of your heirs, we will examine your situation and then strive to develop a creative solution that works for you. Schedule a personalized consultation to learn more. Call 630-665-2500 today.

Sources:

http://www.bankrate.com/finance/estate-planning/living-revocable-trust-facts-1.aspx

http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=3382&ChapterID=60

Encouraging and Protecting Diversity in the Workplace

Illinois business law attorneysDiversity in the workplace can offer varying perspectives, improve the company’s image, and may even result in capital gains. However, many businesses struggle to achieve true diversity and those that do often struggle to protect it. Do things differently, avoid litigation, and ultimately improve your company’s chances of success with help from the following.

Why Diversity is So Important

At first glance, diversity may not seem like the most important aspect of running a business. Instead, most owners focus their attention on things like recruiting experts in their field, reducing overhead costs, and creating a platform from which they can market – and yet these aspects of running a business often come naturally for those that support diversity. As an example, a business that strives to maintain ethnic diversity in the workplace may have a better understanding of cultural differences that may impact their sales and marketing strategies.

Encouraging Diversity in the Workplace

Diversity in the workplace is rarely accidental. Instead, it is done with intention. A business owner must consider what other groups of people can bring to the table. They must be willing to look at the cold, hard facts. They must look beyond the resume, and they cannot be swayed by charisma. Experience may become less about the jobs that a prospective employee has worked, and may become more about the potential. For example, you might consider hiring the white, male applicant with years of experience, but do not discount the homemaker that has spent the last ten years caring for her children.

Though the latter may need more training to ensure she is up to speed, she might also be better at multitasking than your male applicant. She may also have knowledge and experience that is difficult to communicate on a resume. Perhaps she has used accounting software and spreadsheets to maintain her household budgets and has some ideas on how your company could better utilize them. In short, before you hire anyone, be willing to ask probing questions, and always look at the whole picture – not just what is on the resume.

Protecting Diversity in the Workplace

Once you have achieved diversity in the workplace – or are well on your way – it is crucial that you know how to protect it. Workplace harassment, discrimination, resistance to change, and other challenges may arise along the way. Some of these issues could lead to a loss of valuable employees. Others may result in litigation. To decrease your risk of experiencing such consequences within your company, consider implementing the following:

  • Anti-discrimination policies;
  • Anti-harassment policies;
  • Equal pay for all same-skill/same-job employees;
  • An open-door policy for reporting harassment and discrimination;
  • Policies that clearly and concisely convey the consequences of workplace harassment;
  • Managerial training on workplace harassment; and
  • Swift and attentive handling of all harassment complaints.

Contact Our DuPage County Business Law Attorneys

If your company is striving for diversity in the workplace and you need assistance with developing policies, employment contracts, and other anti-harassment procedures, contact Stock, Carlson, Oldfield & McGrath, LLC for assistance. Our DuPage County business law attorneys can work with you to determine your goals, assist you in creating legally binding contracts and policies, and examine any situation involving potential litigation to ensure you have the support you need. Schedule your consultation by calling 630-665-2500 today.

Sources:

http://www.businessinsider.com/why-cbs-made-the-wrong-call-with-hawaii-five-0-contracts-2017-7

http://www.multiculturaladvantage.com/recruit/diversity/diversity-in-the-workplace-benefits-challenges-solutions.asp

Selling Your Rental Property? Beware of Capital Gain Taxes

DuPage County real estate lawyersRental property can increase your bottom line, bulk your investment portfolio, and even fund your retirement. Unfortunately, it can also come back to haunt you. Capital tax gains, which are charged by the Internal Revenue Service (IRS), are applied to any asset that you sell for a profit. Learn how to mitigate against this issue with help from the following information.

Offset Gains with Expenditures

If you have an investment portfolio, you can attempt to offset some of the gain from your rental home with expenditures in other investment areas. Alternatively, you may have expenses related to the home itself, which may also be used to cut your tax load. The strategy, known as tax loss harvesting, should be used only under the advisement of a professional.

Use Section 1031 of the Tax Code

Investors who are simply searching for a new property or investment, and not a cash payout, may lower their tax load under Section 1031 of the IRS Tax Code. It does have to include a like-kind investment, but that does not mean you are required to swap out a house for a house. Instead, you can sell a house and trade it out for a condominium or a store. Just make sure the property is not going to be used as your own because that does not count under the exchange rule.

Turn Your Investment into a Home

Selling an investment property and a home you live in are treated as two completely different tax events by the IRS, which is why some investors turn their rental into a primary residence before they sell. Just keep in mind that you must own the home at least five years and live in it as a primary residence for at least two years before you can claim it as your own. Also, because there are some provisions on the deductions you can take, it is encouraged that you speak with a real estate lawyer before making the final decision to live in your rental.

Contact Our DuPage County Real Estate Lawyers

Whether you are planning on buying, selling, or renting a property, contact Stock, Carlson, Oldfield & McGrath, LLC. Dedicated and experienced, our DuPage County real estate lawyers protect your interests and investments. In every situation, we pursue the most favorable outcome. Schedule a personalized consultation to learn more about how we can help with your next real estate transaction. Call 630-665-2500 today.

Source:

http://www.investopedia.com/articles/personal-finance/121415/how-prevent-tax-hit-when-selling-rental-property.asp?lgl=myfinance-layout-no-ads