What to do When
a Loved One Dies
Brett S. Lytle
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© 2013 McDowall Cotter
Robert D. Vale
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© 2013 McDowall Cotter
What is a Trust?
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Components
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Trustmaker; Trustor; Settlor
Trustees; Money Managers
Beneficiaries
Corpus; Our Stuff (assets)
 Your Trust
 Provides for your disability
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Provides for your loved ones
Contains your instructions
It’s private and confidential
Reflects your hopes, dreams and values
© 2013 McDowall Cotter
Life Cycle
Alive and well
 Alive and not so well
 Upon my death
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© 2013 McDowall Cotter
Alive and Well
 Trust is transparent
 Tax id number is your social security
number
 “You are the Trust”
 You can do anything you want with
your stuff (assets)
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© 2013 McDowall Cotter
Alive and Well
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SUMMARY
• TRUSTEE SELECTION – Have you nominated the Trustees
you want to have oversee your estate?
• BENEFICIARIES – Are you comfortable with the distribution
plan for your estate?
• Beneficiaries identified?
• Is distribution to beneficiaries in trust or outright?
• ORGANIZATION - funding; get the assets in the bucket and
make sure your estate plan is up to date
• RELATIONSHIPS – establish and maintain relationships with
your trusted advisors
• CONNECT THE DOTS - Make sure your Successor Trustees
are familiar with your other trusted advisors
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© 2013 McDowall Cotter
Alive and not so Well
 Disability planning
• When are you disabled?
• Who says you are disabled?
 Role of Successor Trustee
• How does the Successor Trustee take
control?
• Role of agent under Power of Attorney
• Role of agent under Advance Health Care
Directive
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© 2013 McDowall Cotter
Alive and not so Well
 Ensure quality care in a health
environment
 Carry out wishes and best interests of the
incapacitated trustmaker (you)
 Look for other guidelines in the Trust
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© 2013 McDowall Cotter
Alive and not so Well
 Locate important documents
 Determine medical and other coverages and
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apply for benefits
Consult with your Team of Advisors
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Tax Advisor
Financial Advisor
Beneficiaries
Trusted Advisors and Friends
Healthcare Advisors
Attorney
© 2013 McDowall Cotter
Alive and not so Well
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SUCCESSOR TRUSTEE WILL:
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Establish and use a recordkeeping system
Inventory assets
Account for income and expenses
Make insurance claims
Account and pay medical costs
See to Income Tax preparation
Be an advocate for the Trustmaker
© 2013 McDowall Cotter
Alive and not so Well
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SUMMARY (ORGANIZATION IS KEY)
• Proper funding
• Identify trusted advisors; confirm they are
ready to assist if and when the time
comes
• Good record-keeping = Good Successor
Trustee
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© 2013 McDowall Cotter
Left the Planet
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Immediate Steps after Death of
Trustmaker
• Complete funeral arrangements
• Locate important documents
• Do not immediately accept benefits!
• Successor Trustee must consult with
Trusted Team of Advisors
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© 2013 McDowall Cotter
Left the Planet
Administration of Trust after Death
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• Establish accounting system
• Pay final expenses and bills
• Pay taxes - Income and Estate
• Prepare final accounting
• Distribute Assets
• Personal property
• Outright
• In Lifetime Trusts
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© 2013 McDowall Cotter
Left the Planet
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Manage the Distribution of Assets
Use of Lifetime Trusts
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Creditor Protection
Predator Protection
Self Protection
Estate Tax Protection
 Types of Lifetime Trusts
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Common Trust
Special Needs Trust
General Needs Trust
Convenience Trust
© 2013 McDowall Cotter
Left the Planet
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SUMMARY
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Accurate accounting (proper record keeping)
Follow Trust terms (what if unclear?)
Comply with all State & Federal laws
Fair dealing with the beneficiaries; no self-dealing
Comply with tax requirements
Prudent investor: segregate, preserve and
prudently invest trust assets
• Distribute assets
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© 2013 McDowall Cotter
Left the Planet
Summary of Must Do’s
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Make sure you have engaged the trusted advisors
Notify beneficiaries and heirs, as required by law
Notify Dept. of Health Services, as required by law
Notify the County Assessor of death of property owner
© 2013 McDowall Cotter
Left the Planet
Summary of Must Do’s
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• Pay income taxes –
• Final tax return for deceased Trustmaker
• Tax returns for Trust Estate
• Pay estate tax, if due
• Keep and render a full and accurate record and
accounting of trusteeship
• Remember, as a Successor Trustee, you have a
fiduciary duty to the beneficiaries
• There is no higher duty recognized in law
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© 2013 McDowall Cotter
Successful Planning
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Necessary Basic Components of a
Successful Estate Plan
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Revocable Living Trust
Will
Advance Health Care Directive
Financial Power of Attorney
Your Team of Trusted Advisors
© 2013 McDowall Cotter
Thanks for Attending
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San Mateo, CA 94403
Tel: 650-572-7933
Fax: 650-572-0834
www.mcdlawyers.net
(650) 572-7933