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Fidelity Viewpoints August 2023

Ben Franklin said that in this world nothing is certain but death and taxes. Well, one product sits at the intersection of both—life insurance. It may not help you cheat death, but it may help manage taxes.

There are certain estate planning steps we should all take, including the creation of a will and a health care directive. But if you have enough wealth that you expect your estate to be taxed—at either the state or the federal level—you may want to consider more advanced strategies, including an

Trusts & EstatesFebruary 21, 2023 (No. 1)

There are a number of tax changes that took effect at the beginning of the new year. Given these recent changes, as well as the lack of certainty regarding actions Congress may take this year and in the coming years, especially as it relates to the federal gift/estate and generation-skipping transfer (“GST”) tax exemptions, it is of upmost importance for individuals to begin working with their advisors to review their current estate plans and implement any necessary changes and strategies.

This alert will outline the

The most common reasons people set up a Living Trust are:

You avoid Probate: If all your property is in trust when you die (or become incompetent), then legally you don’t own anything in your name. This means, if you die, no probate (formal court administration of a decedent’s estate) is needed to pass your property on to your beneficiaries.
Or if you become incompetent, no conservatorship (formal court proceedings to administer an incompetent person’s assets) is needed to manage your property.In either case, the person that you name in your trust

A conservatorship is a court proceeding to appoint a manager for the financial affairs and/or the personal care of one who is either physically or mentally unable to handle either or both. The person who cannot care for him or herself is called the conservatee. A person or organization the judge chooses to do this is known as the conservator. A conservator can be a family member, friend or professional person.

A conservatorship ends when the conservatee dies, the conservatorship estate runs out of money, or the conservatee regains the ability to handle his or

This year, Governor Brown signed a law, which will significantly change Medi-Cal estate recovery laws beginning Jan. 1. The new law essentially limits estate recovery to the bare minimum required by federal law and will apply to Medi-Cal recipients who die after Jan. 1, 2017.

Federal law requires that states recover Medicaid (Medi-Cal in California) benefits paid to an individual for nursing home care. After a Medi-Cal recipient dies, recovery occurs against assets owned by the recipient at their death. An asset that is frequently used to pay back Medi-Cal is

A DUI conviction in California can result in a number of severe penalties including hefty fines and a mandatory jail sentence. If you are one of thousands of Californians who have a prior drinking conviction, the stakes can be even higher. A second DUI offense in California can result in much harsher punishment than a first offense under the state’s mandatory sentencing guidelines. If you have been convicted of a DUI within a 10-year period, you will be classified as a “repeat DUI offender.”

Severe Consequences

You can face several serious consequences

For years, married couples have used AB trusts to maximize the amount of assets they pass to their heirs free of estate tax.  When the estate tax exemption amount was only $2,000,000 per person several years ago, an AB trust arrangement was necessary just to pass $4,000,000 to heirs fee of estate tax.

With the estate tax exemption amount now over $11,400,000 per person and with surviving spouses allowed to use the “unused” portion of the tax exemption from the deceased spouse, is there any reason to use AB trusts if