The Importance of Cohabitation Agreements

If you've chosen to live together over marriage, you aren't alone. However, many myths still exist about the concept of "living together." The fact remains that, unless you define your partnership through a legal contract, the law may view you as strangers in the case of a breakup or death, which can be particularly difficult when you own a house or other real estate together.

By choosing to live together, couples are foregoing certain rights and protections provided for them in a marriage. Married couples accrue legal rights, including the right to receive a property settlement and/or support in the event of divorce; file joint tax returns; receive distributions from estates free of estate tax; receive survivor's benefits from retirement plans and Social Security; obtain "family" health insurance, dental insurance, and other employment benefits; and automatically share in their partner's property in the event they die without a Will. Unmarried couples, on the other hand, generally acquire similar rights by expressly securing their benefits in cohabitation agreements. A cohabitation agreement is a contract between cohabitants which typically establishes contractually for the parties the rights and obligations that married people obtain by custom, statute, and agreement.

If you, your family, friends, neighbors, or coworkers have questions about cohabitation agreements, give us a call at 253.858.5434 to see how we can be of service.

Educational Trusts

If you want to set aside money to pay for a loved one’s education, you could set up an educational trust. An educational trust specifies that trust funds are to be used for education (however you want "education" defined, whether it's college, vocational school, full-time, part-time, online, educational travel, etc.). In the trust document, you name a trustee and beneficiaries, and also state how trust money is to be used. When the trust becomes operational, the trustee controls the trust property–and pays for the beneficiary’s education--according to the terms of the trust.

If you would like to talk about setting up an educational trust for your kids, grandkids, nieces, nephews, or others, give us a call at 253.858.5434 to find out how we can be of service. We proudly serve clients throughout Washington and Idaho and are available to meet in person, by phone, or via Skype.

Revocable Living Trusts for Out-of-State Real Estate

If you own out-of-state real estate, like a vacation home or a rental or other investment property, you should create a Revocable Living Trust and transfer that property to the Trust. Otherwise, upon your death, there will have to be a probate in every state where you owned real estate. When the property is owned by your Revocable Living Trust, there is no need for these assets to go through probate anywhere.

If you, your family, friends, co-workers, or neighbors have questions about Revocable Living Trusts, give us a call at 253.858.5434 to set up an appointment. We proudly serve clients throughout Washington and Idaho and are available to meet with clients in person, by phone, or via Skype.

Seattle Meetings Next Week

Clients and Colleagues - I will be working in Seattle all day on Tuesday (Sept. 30th) and Thursday (Oct. 2nd) and still have a couple time slots available for meetings in the afternoons both days. If you would like one, give us a call at 253.858.5434 to set something up.

Advising Clients on Forming Nonprofit Organizations

We are experienced in the formation of nonprofit organizations and obtaining tax exempt status for these organizations from the IRS. We also help these clients secure exemption from state taxes.

The Internal Revenue Code provides for about 30 different categories of tax-exempt status. The most common is section 501(c)(3), the category which includes charities (including public supported charities and private foundations), churches, religious organizations, schools, and colleges. Most of the nonprofit organizations which are our clients fall into the 501(c)(3) category.

When we advise clients on forming new 501(c)(3) organizations, we provide advice as to the option of forming the organization as a trust or nonprofit corporation and explain governance options for nonprofit corporations. We also provide insight into governance options, such as whether to provide for voting members or to have a self-perpetuating board of directors. We prepare the articles of incorporation or trust in order to ensure that it will qualify under Treasury Regulations which govern federal tax exempt status. We prepare the bylaws, as well as the various "governance documents," such as a conflict of interest policy, records retention policy, and director (or trustee) indemnification policy.

After making sure the client understands these documents and approves them, we prepare the Form 1023 which is the application to the IRS for recognition of tax-exempt status as a 501(c)(3) organization. We respond to all IRS queries in regard to the application and governing documents, which is part of the review process conducted by the IRS. After securing tax-exempt status, we continue to assist the organization in compliance with federal and state laws, as well as in the development of fund raising plans.

If you plan to form a not-for-profit organization or serve as the manager of an NPO, you understand the importance of following the complex laws and regulations required to obtain and maintain tax-exempt status. If we can be of service to you or your organization, call or e-mail us to discuss your goals and concerns.

Making Gifts as an Estate Planning Strategy

Very few Americans need to worry about federal estate tax or the gift tax. For deaths in 2014, everyone has a lifetime estate tax exemption of $5.34 million, which means you can leave or give away up to $5.34 million without owing any federal tax. Married couples can together leave up to twice that amount free of federal estate tax. (Some states, like Washington, however, impose their own estate tax on smaller estates.)

If you think your estate might owe estate tax, one way to avoid or reduce the tax bill is to give away property during your life. And even if you aren't concerned about estate tax, gifts offer other benefits--you get to see the recipients enjoy your gifts.

In 2014, you can make an unlimited number of $14,000 gifts of cash or other property (like stocks, real estate, or interests in a family business), completely tax-free. To ensure these tax savings, you need to remember that no individual recipient can receive more than $14,000 in a calendar year. The $14,000 annual tax exemption rule (called the "annual exclusion") is pretty straightforward. For example, if you give $20,000 to someone, $14,000 of it is exempt from gift tax, but you must pay gift tax on the remaining $6,000. The exclusion amount is indexed for inflation, rising in $1,000 increments as the cost of living goes up. Couples can combine their annual exclusions, meaning that they can give away $28,000 worth of property tax-free, per year, per recipient.

If you want to learn more about the gift tax exclusion and other estate planning strategies, give us a call at 253.858.5434 to see how we can help.

Estate Planning for Unmarried Couples

Not everybody wants to get married. But just like spouses, people in long-term committed relationships want to make sure that when they die, their surviving partner is taken care of. When you die without a Will, the law gives your estate to your next-of-kin, which sometimes isn't necessarily what we want to have happen. A well-drafted Will gives your estate to the person you want to share it with and directs who is to be put in charge of administering your estate, which is especially important for unmarried partners. It's even more important for unmarried couples who own property together, like a house or a business. And a well-drafted Power of Attorney and Health Care Power of Attorney will appoint the person you want to take care of you in the event you are unable to take care of yourself, either because of age, illness, or injury, which again, is especially important for unmarried couples because they aren't necessarily afforded the same rights as spouses.

If you, your family, friends, neighbors, or co-workers have estate planning questions, give us a call at 253.858.5434 to set up an appointment. We proudly serve clients throughout Washington and Idaho and are available to meet in person, by phone, or via Skype.

Regular Estate Planning Reviews

Guess what we're spending the day doing? Every April 30th and October 31st, we review our estate planning files and send review letters to clients. We review these files so that we can alert clients as to changes in state and/or federal laws which could affect them and indicate a need to update their estate plans. We recommend that clients regularly examine their estate plans and suggest such review be made at least once every 3-4 years, and more often if major changes in family size, relationships, or assets should occur.

If you would like a copy of our checklist of changes or occurrences that might warrant a change in your estate plan or if you think your estate plan should be reviewed or changed in any way, call us at 253.858.5434 for an appointment so that we can meet to discuss your needs and revise your estate plan accordingly.

Including Your Pets in Your Estate Plan

Not all that long ago, an attorney would have given you a weird look if you had asked about creating a "pet trust" or otherwise including your pets in your estate plan. But now, if you don't bring it up, your lawyer is likely to. A good number of people who go to lawyers about Wills and Trusts want to make sure that if their animals outlive them, they will be taken care of.

It's a reasonable concern. Many animals end up being surrendered to shelters after their owners die, and many of them do not find new homes. Usually, family members want to ensure a better outcome for the animals, but simply may not be able to take care of them or find a suitable home. Especially if the pet is older or ill. And the wave of foreclosures in recent years has meant that many families formerly in their own homes are now in rentals, many of which don't allow animals.

Luckily, with some planning, you can provide for your pets, and make sure that they'll always have a home. Washington and Idaho both recognize trusts for pets, in which you can leave money to be used for the care of your pets. In addition to leaving your pets to a specific person, you can also put someone in charge of managing and spending the money in the trust, following a written set of instructions that you provide.

If you have questions about trusts for your pets, give us a call at 253.858.5434 to find out how we can help.

Estate planning is about protection.

Estate planning is about protection. Proper estate planning will protect your heirs, give directions for how your assets should be handled, and minimize the financial impact of your passing. Estate planning can protect your property from creditors. Our firm offers skilled estate planning services. We’ll help you set up an estate plan that protects your assets and family.

If we can be of service to you, your friends, family, co-workers, or neighbors, give us a call at  253.858.5434 to set up an appointment. We proudly serve clients throughout Washington and Idaho and available to meet in person, by phone, or via Skype.

We assist small to medium-sized businesses with their general legal needs.

In addition to assisting small and medium-sized businesses with formation and startup, we assist businesses with their general legal needs, including strategy for business development and marketing, intellectual property, daily business operations, employment matters, negotiations of contracts with third parties, minutes of board and shareholder meetings, purchases and sales of stock and assets, conflict resolution, and confidentiality and non-compete agreements.

We also draft, review, analyze, and negotiate on behalf of business clients various types of contracts, including: shareholder agreements; LLC operating agreements; partnership agreements; purchase and sale of business documents; buy-sell agreements; asset purchase agreements; non-disclosure, confidentiality and non-compete agreements; license agreements; stock purchase agreements; third party contracts; employment agreements; distributorship agreements; reseller agreements; and subcontractor and independent contractor agreements.

If you're a small business owner and need help with your contract or other legal matters, give us a call at 253.858.5434. We proudly serve clients throughout Washington and Idaho and are available to meet in person, by phone, or via Skype.

Valentine's Day Estate Planning "Sweetheart Package"

Valentine's Day is coming up! Hearts and candy and everything! Therefore, we're offering a "Sweetheart Package" from now until February 14th - if you and your spouse call to set up an appointment by the 14th, we'll give you a 50% discount on your legal fees for a complete estate plan (usually includes Wills, Powers of Attorney, Living Wills, and a Community Property Agreement). Give us a call at 253.858.5434 to make an appointment!

Estate Planning and Organ Donation

Estate planning usually includes the preparation of Wills, Powers of Attorney, and Living Wills. The estate planning meeting should also include a discussion about the possibility of organ and tissue donation. It's an attorney's job to get his clients to think about issues they may not otherwise address, whether the issue is who will be guardian of a minor or special needs child, who will inherit particular property, what charitable gifts the client wants to make, who will handle the client's affairs if the client becomes incapacitated, what medical care the client wants if he or she is terminally ill or in a coma, or what will be done with the client's organs and tissues after the client has died. The lawyer can, by conversations with clients and their families, provide input about all of these important areas.

However, organ and tissue donation is rarely raised. It is important that the attorney and client discuss these things. Many people die each year or go through painful and expensive medical procedures while waiting for organ donations. If more lawyers raised these issues with their clients, more people might become organ and tissue donors. By raising the issue of organ and tissue donation with clients during the estate planning process and helping clients understand their rights regarding provisions for such donations, attorneys can have a large impact on society by helping clients' effectuate their wishes to donate, and helping those in need of organs and tissue.

If you have questions about how you can include your wishes regarding organ donation as part of your estate plan, give us a call at 253.858.5434 to see how we can help.

Estate planning is a platform for making important choices about the future.

Estate planning is a platform for making important choices about the future. With the help of a skilled attorney, you can take steps that will protect your assets, express your wishes concerning health issues, and make important arrangements that will make things easier for your family when you die. When prepared wisely and thoroughly, a comprehensive estate plan will allow you to make critical decisions about where your property will go, take care of family members and make gifts to causes you care about, avoid unnecessary tax liabilities, prevent disputes between your loved ones, and designate who will care for you if you become incapacitated.

If you, your family, friends, co-workers, or neighbors have questions about their estate planning needs, give us a call at 253.858.5434. We proudly serve clients throughout Washington and Idaho and are available to meet in person, by phone, or via Skype.

Retiring Baby Boomers & their Small Businesses

Baby boomers are getting to be retirement age. This means that a large number of small business owners are looking to retire and either sell their business or pass it on to their children. If you or someone you know is looking to buy, sell, or otherwise transfer their interests in a small business, give us a call at 253.858.5434 to find out how we can help with what can often be a complex transaction.