When parents battle over school districts

When parents battle over school districts

Child Custody, Divorce/Dissolution

Divorce and custody battles can be emotionally challenging for parents, and one crucial aspect to consider is determining the school district for the child. This decision has a significant impact on the child’s education and stability.

Let’s explore some practical steps and considerations to help parents navigate the process of determining the school district during custody disputes.

  • Understand Legal Framework: Familiarize yourself with the legal framework governing custody and education in your jurisdiction. Consult with a family law attorney who can provide guidance on relevant laws, regulations, and court precedents regarding school district determination.
  • Review Custody Agreements or Court Orders: Carefully review the existing custody agreements or court orders related to the child’s education. These documents may outline specific provisions regarding school district determination. Understanding the terms agreed upon or mandated by the court is crucial before initiating any changes.
  • Prioritize the Child’s Best Interest: Regardless of the custody battle, prioritize the child’s best interest. Courts typically make decisions based on factors such as proximity to the child’s current residence, quality of education, stability, and continuity. Consider these factors when evaluating different school districts.
  • Assess School Districts: Research and assess the school districts in question. Look into academic performance, extracurricular activities, special education programs, and other relevant aspects. Consider the child’s specific needs, such as language support, special education services, or specific extracurricular interests.
  • Communicate and Seek Mediation: Open communication with the other parent is essential. Try to reach a consensus regarding the school district, keeping the child’s best interest in mind. If direct communication fails, consider involving a mediator to facilitate discussions and find a mutually acceptable solution.
  • Obtain Expert Opinions: In complex custody battles, it might be beneficial to seek expert opinions. Educational consultants or child psychologists can provide valuable insights into the child’s educational and emotional well-being. Their professional input can help courts make informed decisions.
  • Gather Supporting Documentation: Collect relevant documentation to support your case. This may include school records, academic reports, extracurricular involvement, and any other evidence demonstrating the child’s current educational environment and potential for success in a particular school district.
  • Present Your Case in Court: If an agreement cannot be reached, prepare to present your case in court. Provide clear, concise, and well-organized arguments supported by evidence. Highlight the child’s best interest, emphasizing how the chosen school district will provide the necessary resources for their education and overall development.

Determining the school district for a child during custody battles can be a challenging process. By understanding the legal framework, prioritizing the child’s best interest, conducting thorough research, and engaging in open communication, parents can increase their chances of finding a resolution that benefits their child’s education and well-being. While the process may be emotionally taxing, keeping the child’s needs at the forefront will help guide parents toward a successful outcome.

When it comes down to it, the determining factor will be what is in the best interest of the child. That means giving the child the best education available.

It’s always wise to speak with a family law attorney that can help guide you through the process of determining school placements.

How Do Pour-Over Wills Work?

How Do Pour-Over Wills Work?

Probate & Estate, Wills

What is a Pour-Over Will?

A pour-over will is a last will and testament that transfers all of the deceased person’s property, upon death, into a revocable living trust. Simplifying; a pour-over will directs that all property that passes through the will be transferred (poured over) into the trust. The pour-over will serves as a safety net for the trust. The property that is transferred through a pour-over will must still be probated, but the process will be shortened and taxes minimized.

Visualize that a trust is a bucket and the grantor’s (the person who creates the trust) assets are held in that trust bucket. Any assets that are outside of the trust bucket when the grantor dies are subjected to probate. The pour-over will scoops up any assets that are outside of the trust bucket at the time of the grantor’s death, then pours them into the trust bucket.

Is a Pour-Over Will Private?

If someone values their privacy, nothing will be revealed throughout the probate procedure. The probate will just state that the assets were moved to a trust and that the trust’s provisions are still private. Additionally, it keeps the estate plan basic because once the assets are transferred into the trust, they will be subject to the same rules as the assets already held in the trust at the time of the grantor’s death. The grantor’s assets will be governed by a single document. Because of this, any estate plan that makes use of a revocable living trust must include the pour-over will.

Additionally, using a trust-based estate plan, parents can designate guardians for their minor children. If the parents do not name guardians for their minor children in the pour-over will, the court will decide who should be responsible for raising the children in the event that the parents pass away. Naturally, parents would prefer to appoint guardians for their children rather than leave this decision up to the court and run the danger of having their kids raised by someone they would disapprove of.

Pour-Over Wills and Probate

A pour-over will provides benefits over a standard probate procedure even though it does not prevent probate. One of the benefits is that the grantor’s payouts are kept confidential. The only thing that will be revealed throughout the probate procedure is that the assets ought to be transferred to the trust. Since the trust is not a matter of public record, none of its provisions will be made available to the public. The only thing the court needs to ensure is that the assets have been transferred into the trust, not that all of the beneficiaries have received notice or distributions. Thus, the probate is kept brief and minimal.

Here’s an example:

Imagine establishing a trust as part of an estate plan, but the grantor forgets to add an investment account or newly purchased property to the trust’s holdings before passing away.

There is now a significant asset that is not covered by the trust agreement and, in the absence of a pour-over will, would be distributed by the court as if the decedent had passed away intestate, which means that he or she had no estate plan in place.

In this situation, the investment account’s money could end up flowing to people who they never intended to benefit. With a pour-over, the probate judge is instructed to pour the asset into the trust, where it will be managed and dispersed in accordance with the trust document. It will preserve the grantor’s wishes.

If you have any questions about pour-over wills, trusts, probate, or estate planning contact attorney Chuck Bendig for a consultation.

 

Older Couples Selling Their Homes Can Get Major Tax Breaks

Older Couples Selling Their Homes Can Get Major Tax Breaks

Probate & Estate

Susan recently lost her husband, Carl, and is now a widow. They shared ownership of their home with the right of survivorship. In simpler terms, this means that upon the death of Carl (co-owner), the surviving co-owner (Susan) automatically acquires full possession of the highly appreciated home.

Susan is unsure if she should sell it now and move to where her son lives, wait a few years to sell or stay put, in which case the house would eventually pass to her heirs.

She is curious about the tax consequences of her options. She must first understand the tax breaks available to individuals who sell their primary residences.

Exclusions

The law permits “exclusions” that let sellers avoid paying income taxes on the majority of their profits when they sell their primary residences. The profit exclusions are up to $500K for couples who file jointly, and as much as $250K for individuals. All sellers are liable for gains that exceed $500,000 or $250,00, respectively.

Susan chooses to sell her home.

Can she exclude $500K or $250K? The solution depends on the sale date and whether she marries again. Although no longer married, Susan is still eligible for the $500K as long as she sells within two years of Carl’s passing. If she sells after the two-year window, she is only eligible for $250K.

Susan remarries.

If her new spouse, George, lives in her home as his primary residence for at least two years out of the five years prior to the sale date, the exclusion will revert to $500K again.

Typically, the seller must have owned the home for those two years. George doesn’t fit those criteria. His name doesn’t have to appear on the title.

Additionally, according to the IRS, Susan and George don’t have to be wed for the entire two years prior to the sale date, but they do need to be married, even if their wedding takes place just one day before the transaction.

Susan’s taxable gain might be less than she anticipates even if she doesn’t get remarried and doesn’t sell her home within two years of Carl’s death. It is likely that Susan owes taxes on the gain because her long-term capital gain on the sale of her home exceeds the exclusion limit.

Tax rates for long-term capital gains.

The tax rate is usually 15% for most sales, rising to 20% for many high-income sellers. When combined with the Medicare surtax of up to 3.8% on certain types of income, such as earnings from home sales, it can reach a maximum of 23.8% for people in the top income tax bracket of 37%.

  • State income taxes may also be owed.

Tax Cuts and Jobs Act

State and local income and property tax write-offs were limited by the tax cuts and jobs act to $10,000. Another issue is that if Susan is subject to the alternative minimum tax, she loses any write-offs for state income taxes.

Step-up in basis

The government offers condolence gifts for bereaved people who sell inherited homes, securities, and other assets that have increased in value. According to tax terminology, the basis (the starting point for measuring loss or gain) of inherited assets “steps up” from their initial basis (typically the cost at the time of purchase), to their value on the date of death.

When Susan sells her home after Carl dies, she will gain from a step-up in basis. What if she never sells it? Upon Susan’s death, there’s a second step-up in basis that benefits her living heirs.

Only Carl has a partial interest in the first advancement. His adjusted basis is raised to the value of that half-interest at the time of his death, which is normally equal to half the original purchase price and half the cost of any later house modifications. If the couple had resided in a state with common property, the step-up would apply to the entire basis.

When Susan dies, there is a step-up in her adjustment which was previously increased by the step-up for Carl’s half interest, to the value of the entire house when she dies. When the heir sells it, they are liable for capital gains taxes only on the post-inheritance appreciation.

The bottom line

A sale by her heirs greatly reduces or even eliminates those taxes, in comparison to Susan’s sale of the home, whose value has increased significantly. Susan, as well as those in comparable situations, should consult with a tax and estate planning attorney to be sure they’re choosing the right course of action for their long-term future goals.

 

How a Trust for Minors Works

How a Trust for Minors Works

Probate & Estate, Wills

Listen to article - 2:33 seconds

A trust for minors is typically established as a strategy to protect assets and distribute property to children without allowing them immediate access to their inheritance. Typically, minor trusts come with instructions that specify when the funds, estate, or other assets may be released to the minor. Trusts for minors are a great approach to guarantee your children’s long-term security and financial future after your passing.

Establishing a trust for a minor serves a number of purposes:

  • Proactively plans for the distribution of finances.
  • Sets up a timeline as to when the beneficiaries will receive the funds.
  • Defines how the funds should be allocated.
  • Addresses the plan of action should the minor pass away.

You can also choose between a living trust and a will. Each brings unique capabilities. Let’s discuss some of the options you’ll have.

1. Any property left to a minor can be managed by an adult trustee, either of your choosing or court-appointed, who will administer the funds on the minor’s behalf. You can determine the age at which the trust funds become available to the minor for use. For instance, you may feel that a young person lacks the maturity to make good financial decisions. Simply specify the age, and the authority remains with a trustee until the young person reaches the appropriate age.

2. You can set up the trust fund to disperse the money in installments rather than having a flat payment. This can be done as a safeguard to make sure that all of the money isn’t spent right away and it may have tax benefits.

3. You can also restrict the funds to housing, educational, and medical costs. You can choose to include a secondary beneficiary; maybe a grandchild, or to exclude a person’s access to the inheritance completely.

4. Maybe the recipient has a mental or health condition that prohibits the ability to administer the funds on their own, or maybe you’re caring for a minor who has special needs and will require medical care throughout life. In these cases, you can choose to assign a permanent trustee.

As you can see, a Minor Trust offers tremendous flexibility and the structure will impact the lives of the people that you leave behind, and your legacy.

If you need help creating a Minor Trust or want to discuss your options, contact Ohio attorney Chuck Bendig.

How To Divide Possessions Among Heirs

How To Divide Possessions Among Heirs

Probate & Estate, Wills

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The death of a family member brings the family together to share their grief, but then things can get ugly. For example, the daughter of the deceased may announce that her mom promised her the car, but her brother may contest that the car was promised to him. A fight can potentially lead to a split family.

The purpose of a well-crafted estate plan is to give clarity to your wishes so that splitting your assets doesn’t split your family

First, list the most important or valuable items. Your will can get long if you try to list every possession, so create a written statement naming who gets what.

Next, ask your family who values which items the most. From a legal standpoint, it doesn’t have to be witnessed, but if you expect it to be challenged, have it witnessed, dated, and keep that statement with your Will. Make things easy for your executor and your heirs, by taping a note to an item such as furniture or artwork with the name of its new owner.

You may want to direct in your will that some items be sold. It may make sense to sell items of great value and distribute the proceeds. You can, for example, direct a valuable painting to be auctioned off and the proceeds split equally.

Another option is to give everything away while you are alive. The more you distribute now, the less stuff that needs to be dealt with after your death.

When you give gifts, make sure everyone knows about them so that the person receiving the gift is not accused of stealing after your death.

You can make a “deed of gift” for tangible personal property retaining the right to keep things in your home as long as you live. For tax reasons, it may be better not to gift highly appreciated property, like your home or investments, during your life because the new owner will lose the step-up basis.

Get appraisals. Knowing what things are worth may guide your decisions. You can stipulate that the assets be sold and the proceeds divided evenly. If an heir wants the asset, they can choose to buy out the others.

Use a lottery. Some prefer to keep it simple. Your will or trust can authorize your executor or trustee to put names or numbers in a hat and have beneficiaries draw for the order to choose items.

Children support their parents in unequal ways, so disagreements may surface, causing serious tension. If one of your children provides most of your care, make sure your will is extremely clear to avoid strife.

Remember that after your death, you won’t be around to talk your family through any disagreements.

Proper estate planning can remove the stressors, tax burden, and decision-making from your heirs while they are grieving your loss. This should be the time to reconcile and forgive.

We are ready to help you find the best solution for you and your family. Call Chuck Bendig.