Even if you already have an estate plan, it's still important to review it periodically to ensure that your wishes are accurately reflected. By reviewing your estate plan every 1-3 years, you can make sure that you and your family's needs are appropriately met. 

Updating Your Estate Planning Documents

If some time has passed since you created your estate plan, you may want to consider reviewing it (either with or without an estate planning lawyer) to see if there's anything you want to update.

If circumstances have changed since you initially created your estate plan, then you may need to hire an estate planning lawyer to help you make updates. Here are some common situations that prompt people to update their estate planning documents:

1. The death or birth of family members.
2. A substantial increase or decrease in wealth.
3. Changes in the law.

Partial Amendment or Restatement? 

If the changes to your Revocable Living Trust or Will are minor, you may only need a partial amendment or codicil, respectively.

However, if the changes are substantial, it's often best for the lawyer to "restate" or re-write the entirety of your trust or Will. This is often because your existing trust may contain provisions that depend on one another and making too many changes may detrimentally affect how your trust operates.

Indeed, with the rise of word processing and document assembly programs, restating documents can often be much cheaper than trying to hobble together changes to an existing document.

In simple situations, estate planning documents rarely need a complete overhaul. However, it's still a good idea to review your estate planning documents periodically, and at the very least, when there are major events such as the birth or death of a family member. In fact, you might consider setting a date every year where you review your financial situation, as well as your estate planning documents to ensure that both are performing properly.

Be Prepared

Kudos to you if you've already established an estate plan. You're among the small minority of responsible adults! You (and more importantly, your family) are likely in a much better position than other people you know. Interestingly, after a client finishes signing their estate planning documents, they often sigh and tell me how relieved they are. When I ask how it feels to be done, they reply, "I honestly can't believe I waited so long. I feel a sense of relief about concerns that I didn't even know I had!"

Los Angeles (and the rest of the country) is filled with entrepreneurs and business owners. If you're young, you've probably never thought about this, but what happens to your business if you pass away or lose the capacity to work? This is where business succession planning comes into place.

Business Entities?

If you run a business, it is probably worth creating some sort of business entity for the purpose of operating it. For example, if you have (or are growing!) a real estate empire, it may be worth utilizing one or more LLCs to hold those interests. In addition to potential liability protection, the government documents for the business entity, whether it is an LLC, corporation, or some other form of business entity, can provide details about how profits are to be split (if you have more than 1 partner), as well as provide a plan for who will manage the business in the event a partner passes away or is not able to actively participate in the business.

Intersection With Estate Planning

As part of the estate planning process, the estate planning lawyer may discuss:

1. Forming a business entity to hold your business(es) and drafting the appropriate LLC Operating Agreement, Partnership Agreement, Corporate Bylaws or Shareholders' Agreement.
2. Assigning your interest in the business entity to your revocable living trust.
3. Assigning all or a portion of your interest in the business to others, including family or other associates.

Planning for your business can help to ensure that your family and other business partners are able to maximize the value of the business and that the business remains productive long after you pass away. It can also be a good tool to teach younger generations how the business works and instill in them values that may be of importance to you.

You may not know that California is considered a "Community Property" state. In Community Property states, assets owned by married couples or registered domestic partners are considered either "community" assets or "separate" assets. Whether an asset is community or separate property has a significant impact on how those particular items are distributed.

(Simple) Definition

Community property, in general, includes assets that you earn through your labor (such as a salary) after your are married. If you own property that is considered community property, then the income from that property would also be considered community property. Community property is considered owned 1/2 by each spouse or registered domestic partner.

Separate property, in general, is assets that you owned prior to marriage, or assets gifted or inherited directly by you at any time, and would include the income generated from separate property that you own.

If couples want to be sure that their assets can be properly characterized at a future time, it is critical to keep community and separate property separate.

Transmu-what? (Transmutation)

Married couples or those in registered domestic partnerships can agree to "transmute" their property. That means, they can:

1. Convert community property into the separate property of either of them.
2. Convert separate property of either of them into the separate property of the other of them.
3. Convert separate property of either of them into the community property of both of them.

There may be a number of reasons for why a couple might want to do this, as it can affect the way assets are distributed at the time of death, and can help the couple achieve certain tax minimization goals.

It's important to note that registered domestic partners are not considered "married" under federal law. Therefore, the federal tax benefits available to registered domestic partners are limited.

If a couple meets with an estate planning lawyer, this is certainly going to be a part of the conversation, so be prepared.

When most people think of estate planning, they think of money, investments, real estate, and other items of value. One thought that is overlooked are the important medical decisions that may need to be made if you became incapacitated. For this reason, just about every estate plan also includes a document called the Advance Health Care Directive.

Features Of An Advance Health Care Directive

The Advance Health Care Directive allows you to tell your medical providers your wishes with respect to life-sustaining treatment if you have a terminal illness, if you're in a coma, or the risks of treatment would exceed the expected upsides of that treatment. You may also specify the parameters of any relief from pain that you want or organ donation. Perhaps one of the most important things the Advance Health Care Directive does is allows you to name one or more individuals (also known as an "health care agent") to make decisions for your regarding your health care.

Powers of A Health Care Agent

In general, the health care agent has the following powers:

1. He or she has the right to receive your medical information
2. He or she has priority over others in making health care decisions for you
3. He or she has the power to deal with your remains after you pass away (except to the extent that you specify in the Advance Health Care Directive)

California has conveniently created a statutory form of Advance Health Care Directive. You can find it for free in the California Probate Code Section 4701, so there's no reason not to have one!