Failure to create a proper estate plan can not only increase the cost of administering an estate, but also lead to unintended consequences, like paying more taxes.

The death of a loved one can be one of life’s most difficult events. People generally agree that a smooth transition of assets after a death is desirable. And yet many people fail to plan and turn what could be a smooth transition into a painful process. Failure to plan can not only increase the cost of administering an estate, but also lead to unintended consequences such as paying more taxes.

Laws enacted in 2017 doubled the amount one could gift during life or leave to heirs upon death. That amount was increased from $5 million to $10 million per person. After adjusting for inflation, that amount rose to $11.58 million per person in 2020. Coupled with “portability” - which enables a married couple to effectively double this amount - a married couple can now give away $23.16 million during life or upon their deaths without facing a federal gift or estate tax obligation.

This raises the question of whether creating tax-planning trusts have become a thing of the past. Not in Washington state.

Washington still has its own estate tax, which this year impacts estates over $2.193 million. Because the revenue from the Washington estate tax is earmarked for higher education, it is not likely to be repealed any time soon.

Many married couples mistakenly believe that they can double the Washington exemption like they can with the federal exemption. This is not true without tax planning. If all property were to pass to the surviving spouse outright, when that surviving spouse dies later, the surviving spouse only has his or her exemption amount. There is no “portability” of the Washington exemption amount like there is at the federal level. This can take many people by surprise.

The bottom line is that if the total value of a Washington resident's estate exceeds $2.193 million - including real estate, life insurance proceeds, retirement, bank and investment accounts – then they should consider tax planning to address the Washington estate tax. Income tax considerations should also be addressed.

It is possible to structure an estate plan to include assets in the federal estate of a surviving spouse and to receive a basis adjustment while keeping those same assets out of a surviving spouse’s estate for Washington purposes. Why is this important? Because it can save capital gains tax as well as Washington estate tax.

An additional planning technique is to give money away during one’s lifetime. Although Washington has an estate tax, it does not have a gift tax. Consider whether your Durable Power of Attorney for financial decisions includes a clause that would permit gifting and how much. A law passed in 2016 limits gifts to the annual exemption amount ($15,000 this year) unless otherwise specified. While in the past, gifts were often limited to the annual exemption amount, now that people can give away up to $11.58 million during their lifetime, they need not necessarily feel constrained by the $15,000 amount. Although gift tax returns must be filed for gifts above that amount, it only reduces what one has left to give and with the current $11.58 million gift and estate tax exemption amount, there is room to spare.

Although gifting assets during life can be an effective way to reduce one’s taxable estate, it’s important to determine which assets to give because of the impact on basis and capital gains tax. For example, if stock bought for $10 a share is given away when it is worth $110, the receiver would have $100 of built in capital gains that is subject to capital gains tax when the stock is sold. However, if the stock is inherited after the giver dies, there would be a step-up in basis to the date of death value, therefore avoiding the built-in capital gains. Engaging the assistance of a competent professional can help with the analysis of everyone’s particular situation.

Tax planning can be done in either a Will or a Revocable Living Trust, which puts all of one’s assets into a Trust. Estates in Washington can go through probate efficiently without court supervision. This surprises people who have moved to Washington from other states where Revocable Living Trusts are necessary to avoid a costly court-supervised probate administration. Nonetheless, there are some circumstances that lend themselves to a Revocable Living Trust plan. Difficult-to-transfer assets, out-of-state property, second marriages, and privacy concerns will weigh in favor of such a plan. But for those people without such concerns, a will-based plan can be more cost effective and simpler.

Whether you chose a Revocable Living Trust or a Will, planning for both Washington estate tax and capital gains tax can be a complex analysis, unique to your particular situation. If we can be of service to you, your family, friends, neighbors, or co-workers, give us a call at 253.858.5434 to set up an appointment today.

Proper estate planning can easily eliminate most trust and estate disputes and avoid needless litigation.

Many trust and estate disputes occur simply because someone failed to properly plan for their demise or incapacity. Often, proper estate planning can easily eliminate needless litigation.

Coordinating your beneficiary designations with your estate plan ensures that assets such as life insurance, retirement plans, bank accounts, and other financial assets pass to the intended recipient. Assets that pass by beneficiary designation are contracts between you and the retirement plan custodian or life insurance company and will pass directly to the named beneficiary, regardless of what your Will says.

One of the most frequent problems relates to accounts held in "joint tenancy with right of survivorship." Many people do not realize that listing a joint tenant with right of survivorship on their bank account means that person is now a joint owner of that account and when the original account owner dies, the person listed as joint tenant is presumed to be entitled to the balance of the account. For example, your carefully crafted estate plan that names a trust for the benefit of your spouse could be inadvertently thwarted if all of your assets are held in a bank account with your children from a prior marriage as joint tenants with right of survivorship. In that case, your assets would pass to your children and nothing would pass to the trust created for your spouse.

This accidental disinheritance is often found when someone adds a child to their bank account. Joint tenancy with right of survivorship is the default account titling for many banks for accounts that are owned by two or more people. In fact, some institutions advise that to prevent the account from being frozen upon death, it is preferable to add a joint "owner," instead of just an authorized signor. In a situation where one child is helping to pay the bills, there may be a dispute over the intent of adding the child as a joint owner to the account. You should be clear, in writings or other asset statements, whether the addition of a child to the bank account was for convenience only, or if the intent was truly to make a gift to the child of the remainder of the account at death, to the exclusion of other children or beneficiaries.

Issues can also arise if you are married but have children from a prior relationship and you do not execute estate planning documents or you plan as if the family is not blended. If you die without an estate plan, the state laws control how property is distributed. Without a Will, if you leave behind a spouse and children from a prior relationship, the surviving spouse is entitled to all of the community property and one-half of your separate property, leaving your children with only half of your separate property.

Alternatively, relying on a plan in which the new spouse receives everything outright under the terms of the Will may significantly reduce or eliminate any inheritance received by your children from a prior marriage. The surviving spouse now owns all of the property and can change their Will at any time to exclude your children from their plan. Including relatively simple trust language in your Will allows you to provide for your spouse as well as for your own children.

In addition to proper estate planning, communication plays a vital role in avoiding estate disputes. Descendants may have unrealistic expectations about how much they will receive or be disappointed by not getting what they feel they are entitled to receive. If you are intent on disinheriting a child or other close friend or relative, let your intentions be known as to why you are not leaving them any assets. Thinking, “they know what they did,” will not stop an upset heir from initiating litigation to recover what they believe is their fair share of the estate. A simple explanation in your Will can answer a lot of questions. Such an explanation could be, “due to the numerous gifts I made to Joe during my lifetime, I leave nothing to Joe under my Will.” Or, a detailed letter that is signed and dated by you and kept with your Will adds certainty to the question of your intent after you have passed.

Planning ahead and being clear on your intentions will go a long way to keeping your estate out of an extended court fight once you are gone. If you have questions about these or other estate planning matters, give us a call at 253.858.5434 to set up an appointment today.

Phase 2 of Washington's Safe Reopening Plan and the Americans with Disabilities Act

The Washington State Emergency Management Division reports that some people are claiming that they will cite the Americans With Disabilities Act as a reason for them to walk into any business they choose without a mask. They’ve printed little home-made cards and are keeping them in their wallet or purse. The Governor’s mask mandate does have exemptions, including people with certain disabilities or health conditions. But a business or government agency is not forced to allow you inside. They can make reasonable accommodations for people with disabilities and health conditions. Examples include:

* Allowing a person to wear a scarf, loose face covering, or full-face shield instead of a face mask;
* Allowing customers to order online with curbside pick-up or no contact delivery in a timely manner;
* Allowing customers to order by phone with curb-side pick-up or no contact delivery in a timely manner;
* Allowing a person to wait in a car for an appointment and enter the building when called or texted; or
* Offering appointments by telephone or video conferences.

There are many fake ADA flyers and posts going around that were never issued by any governmental agency. For more on the myths and facts about cloth face coverings, visit the Washington State Department of Health's web site.

Using Social Media While Your Personal Injury Case is Ongoing. Just Don't Do It.

Sometimes social media can inadvertently come back to hurt you. This is especially true for injury victims who use social media. We advise our clients to exercise extreme caution when posting to social media while pursuing an injury case. If you say something on social media that works against your case, it can hurt your chances of recovery. You might say something that calls the facts of the case into doubt. You might say something that makes you look bad. You may end up saying something on social media that contradicts what you’re claiming in the case. For example, if you’re claiming that you have a broken arm, but you post on social media that you’re going bowling, the defense is going to challenge your injuries. When you have an injury claim, you must always be completely honest about your injuries and losses. Contradictory social media posts can completely ruin your case.

Check-ins on Facebook and other sites can show that you’re participating in activities that contradict the injuries you’re claiming. For example, if you’re claiming you have limited mobility, you shouldn’t check in at your yoga class. Location posts can count as evidence against you.

Social media posts can also inadvertently show the other side what you’re physically capable of doing after your injury. If you post a picture of your children on the ski hill, the other side might ask who took the picture. If the answer is you, they’ll have proof that you’re on a ski hill. What you post can call your case into question in ways you may not be able to predict.

Even the things that witnesses post on social media can hurt your case. They might contradict your claims about your injuries. They might post pictures of you at family events, giving your kids or nieces and nephews piggyback rides. They might make statements about how much money you want to get paid for your losses. These things can hurt your evidence in the case and paint you in a negative light.

At trial, the rules of evidence say that what a person says outside of court typically isn’t admissible at trial. Out of court statements are often categorized as inadmissible hearsay.
However, there’s a routine exception for the statements of a party. When you’re bringing an injury claim, your statements to others outside of court are admissible against you because you’re a party to the case. Your social media posts count as statements, and that’s why they’re admissible against you in court. Statements by family and friends on social media are also admissible if they contradict the same person’s statement in court.

You might think that you can still use social media during your injury case if you’re really careful. You might assume that you can carefully filter your social media posts by reading everything you post with a critical eye. Unfortunately, it’s all too easy to say something that you don’t realize may be used against you. You never know how the other side is going to try to twist your words and your posts. Trying to monitor your social media use is too risky when your recovery is on the line.

Even if you make your Facebook page viewable by your friends only, there are things that the other side can do to see what you post. First, if they know any of your friends, they can ask your friends to give them the information voluntarily.
Second, they can take advantage of the rules of discovery. These rules can require you to produce records. The other side may demand that you provide copies of your social media records even when your account is set to private.

A social media squabble can complicate your case. You and your lawyer may have extra trips to court to hash out whether you have to produce social media records for the other side. On the one hand, courts have ruled that there’s no social media privilege. You can’t get out of producing relevant social media records by setting your status to friends only or private.
However, the key to social media discovery is showing relevancy. The discovery rules don’t allow parties to demand large amounts of records in the hopes that they’ll find something helpful for the case. That’s called a fishing expedition. These conflicting legal priorities can result in a court battle that makes your case more complicated and stressful.

So if f you’re bringing a personal injury claim, don’t post anything personal on social media. If you absolutely must use social media, limit your social media use to liking other people’s posts and sharing news articles.

You should see what’s out there about you by searching for your own name. Ask friends and family not to mention your case. Your best bet is to lay low on social media sites until your case is fully resolved.

If you have been injured in an auto collision and are pursuing an injury claim, it’s essential to contact a qualified lawyer. Your lawyer can help build, file, and present your case. Additionally, your lawyer will provide expert guidance at every stage of your case. This guidance is crucial to helping you gain an understanding of the things you should avoid to make your case as simple and successful as possible. That includes helping you make sure to avoid social media pitfalls during your case. Don’t let a simple mistake compromise your ability to recover the compensation you need to get back to your life.

If you, a friend, family member, neighbor, or co-worker has been injured in an auto collision, give us a call at 253.858.5434 to set up an appointment for a free initial consultation.

Advising Clients on Matters Related to Forming a New Business

We advise clients on all matters related to business formation, including taxation and related liabilities that may impact a business’s profit stream in the future. These factors are evaluated when we help clients form their businesses, franchise, or nonprofit companies. In Washington, the types of business entities can include:

* Sole proprietorships
* S corporations
* C-corporations
* Limited Liability Companies (LLCs)
* General Partnerships
* Limited Partnerships
* Limited Liability Partnerships
* Nonprofit Organizations
* Professional Service Corporations and Limited Liability Companies

At the outset of a new business, we assist clients in choosing the best business legal form for their needs, which usually includes addressing the following considerations:

* Type of business and employee considerations – will the business have employees, or is it primarily an investment vehicle?
* Tax considerations – will the pass-through tax considerations available for those seeking S Corp tax treatment be desired?
* Future financing and equity considerations – will the company want to issue equity later to raise additional capital or grant equity interests to management or employees?

These are only a few of the considerations that should be considered in order to determine what type of legal entity will be best. We advise clients of the matters that are most important to them so that they can make the choice for the best legal entity based upon their business. We then prepare and file all necessary corporate and legal documentation required.

As companies grow and circumstances change, a number of events can occur that may impact ongoing business operations (particularly in a closely-held company), such as:

* The need to raise additional capital
* The death or incapacitation of a key owner
* The desire of one owner to sell their equity interests
* An intractable deadlock on a key management issue.

In the business formation stage, we routinely advise new business owners on these and other significant events that could potentially occur. We help business owners address these matters, typically in shareholder, buy-sell, or other agreements. Such agreements can be critical, so that if one of these events occurs, a legally agreed-upon process can be implemented, rather than costly and disruptive litigation.

After the business is formed, we represent business owners and executives by advising them on management and governance of their companies. We work closely with clients from start to finish to ensure that they understand their rights and duties within the corporate structure and the legal basis for the type of entity used to form their companies. We provide continued support after formation to ensure best practices are adopted for entity governance.

Whether your business goals involve forming a new start up, merging with a larger company, or purchasing a competitor, we can provide you with the insight and guidance you need to ensure a smooth transaction. Give us a call at 253.858.5434 to find out how we can be of service.

Owning real estate in more than one state can require multiple probate proceedings in multiple states (called "ancillary probate"). We can help you avoid that.

What’s worse than having to go through formal probate proceeding after a loved one dies? Conducting two such court proceedings—in different states.

Two probates can be required if someone lived in one state but left real estate in another. If that’s the case, there may need to be a probate in each state. That’s because real estate is always governed by the law of the state in which it’s situated, not the law of the state where the owner lives.

Example: Julie is a resident of the great State of Washington; she lives here and owns a home and other assets here. She also owns a vacation home in Arizona, which she and her husband bought together years ago. Now that her husband has passed, the Arizona property belongs to Julie alone. At her death, there will probably need to be an Arizona probate proceeding before the property can be transferred to Julie’s daughter, who will inherit it.

Probate in a second (or third) state is called “ancillary probate,” and for the Personal Representative of the deceased person’s estate (and the heirs and beneficiaries), it means more bother and expense. The PR will probably need to find a lawyer in the other state to handle the probate.

Probate is begun first in the deceased person’s state of residence. (This is sometimes called the “domiciliary probate” because it takes place where the deceased person had their permanent home.) Then a second probate case (the ancillary probate) is opened where the out-of-state real estate is located. Once a Will has been accepted by the probate court in the state of residence, generally it will be accepted by another state without further proof. It’s called a “foreign Will.”

If you want to spare your family the expense and headache of an ancillary probate proceeding after your death, make avoiding probate for out-of-state real estate a priority. You’ll probably have several options, depending on state law. They may include:

* Owning the property with someone else in joint tenancy, tenancy by the entirety, or community property with right of survivorship.
* Putting the property in a revocable living trust.
* Recording a transfer-on-death deed for the property.

If you own real estate in more than one state and have questions about avoiding the need for an ancillary probate, give us a call at 253.858.5434 to set up an appointment today.

While estate planning is important for married couples, it is arguably even more necessary for couples that live together without getting married.

While estate planning is important for married couples, it is arguably even more necessary for couples that live together without getting married. Without an estate plan, unmarried couples won’t be able to make end-of-life decisions or inherit from each other.

Estate planning serves two main functions: determining who can make decisions for you if you become incapacitated and who gets your assets when you die. There are laws in place to protect spouses in couples that have failed to plan by governing the distribution of property in the event of death. If you do not have a Will, property will pass to your spouse and children, or to parents if you die without a spouse or children.

But there are no laws in place to protect unmarried partners. Without a solid estate plan, your partner may be shut out of the decision making and the inheritance. The following are the essential estate planning steps that can help unmarried couples:

JOINT OWNERSHIP. One way to make sure property passes to an unmarried partner is to own the property jointly, with right of survivorship. If one joint tenant dies, his or her interest immediately ceases to exist and the remaining joint tenants own the entire property. This is also a good way to avoid probate.

BENEFICIARY DESINGATIONS. Make sure to review the beneficiary designations on bank accounts, retirement funds, and life insurance to make sure your partner is named as the beneficiary (if that is what you want). Your partner will not have access to any of those accounts without a specific beneficiary designation.

DURABLE POWER OF ATTORNEY. This document appoints one or more people to act for you on financial and legal matters in the event of your incapacity. Without it, if you become disabled or even unable to manage your affairs for a period of time, your finances could become disordered and your bills not paid, and this would place a greater burden on your partner. Your partner might have to go to court to seek the appointment of a guardian, which takes time and money, all of which can be avoided through a simple document.

HEALTH CARE POWER OF ATTORNEY. A health care power of attorney appoints an agent to make health care decisions for you when you can't do so for yourself, whether permanently or temporarily. Again, without this document in place, your partner might be shut out by other family members or forced to go to court to be appointed guardian. If it is important for all of your family members to be able to communicate with health care providers, a broad HIPAA release--named for the Health Insurance Portability and Accountability Act (HIPAA) of 1996--will permit medical personnel to share information with anyone and everyone you name, not limiting this function to your health care agent.

WILL. Your Will says who will get your property after your death. If you have minor children, your Will permits you to name their guardians in the event of your death. Second, it allows you to pick your Personal Representative to take care of everything having to do with your estate, including distributing your possessions, paying your final bills, filing your final tax return, and closing out your accounts. It's best that you choose who serves in this role.

REVOCABLE LIVING TRUST. A Revocable Living Trust can be especially important for unmarried couples. It permits the person you name to manage your financial affairs for you as well as to avoid probate. You can name one or more people to serve as co-trustee with you so that you can work together on your finances. This allows them to seamlessly take over in the event of your incapacity.

We can help you create the estate plan that is right for you and your partner. Give us call at 253.858.5434 to set up an appointment today.

What are UIM and PIP coverages on your auto insurance policy, and why are they important to have?

Even though the law says that every driver should carry at least some auto insurance, in reality, there are thousands of drivers on our roads who are not insured at all. In addition, thousands more only carry the bare minimum insurance. What this means to you is, if you are injured in an auto collision, you may have to use your own insurance to pay your medical bills, lost wages, lost ability to work, and other damages. But what type of insurance should you carry to give yourself the protection you need?

Due to the many uninsured and underinsured drivers out there, virtually every lawyer will recommend that you carry a significant amount of uninsured motorist or underinsured motorist (UIM) protection insurance. By purchasing these policies—which often only cost a few dollars a month—you will have an insurance policy to pursue compensation for your injuries if a driver with no insurance (or little insurance) hits you.

Although it is not mandatory in Washington, we also strongly recommend that you purchase personal injury protection insurance. Personal injury protection, or PIP, insurance covers your medical expenses and lost wages, up to the policy limits, no matter who is at fault in the collision. Therefore, if you are injured in a car crash, your own PIP insurance would be the first policy to pay toward your medical bills.

One possible drawback to these insurance requirements is that most people only buy the minimum of PIP, usually $10,000, and that amount does not go very far when I comes to medical bills. Often your emergency room bills alone will total more than $10,000. So once your PIP insurance is gone, what is the next step? If the collision was the other driver’s fault, then the at-fault driver’s insurance (what lawyers call "3rd party insurance") likely would be the next policy in line to compensate you for your injuries. However, if the at-fault driver is not insured, you are out of luck unless you carry UIM insurance.

With UIM insurance, claims that exceed your own PIP and the at-fault driver’s insurance will be covered up to the limits of your UIM policy. Often, UIM policies are one of the only coverages available for personal injury lawyers when they make a claim for their clients.

If you have questions about the insurance policies that may be available in your case—including PIP and UIM coverage—please contact us at 253.858.5434 for a free initial consultation.

Estates under $11.58 million ($23.16 million for married couples) are not subject to estate tax. So is charitable planning still important?

Estates that are under $11.58 million ($23.16 million for married couples) are not subject to the federal estate tax. So is charitable planning still important? The desire to help worthwhile causes remains the overriding motivation for making charitable bequests or funding lifetime gifts. Charitable gifts may still save taxes where donors leave charities items of income in respect of a decedent (IRD) (especially retirement accounts) or own property in states that levy inheritance taxes. Whether or not taxes are a concern, we always ask clients if they wish to include gifts to charity in their estate plans. Charitable remainder trusts and gift annuities can assist both charities and family members. Clients who can't itemize may find that lifetime remainder trusts or gift annuities allow them to exceed the standard deduction while retaining payments for life from their gifts. Many donors find satisfaction in continuing their support for their favorite charities.

If you have questions about including charitable giving as part of your estate plan, please give us a call at 253.858.5434 to set up an appointment. We represent clients throughout Washington and Idaho.

Estate planning for blended families can get complicated. We can help.

Estate planning for blended families can get complicated. Let's say Client A and Client B are getting married. A has two kids from a prior relationship and B has one kid from a prior relationship. They plan to have kids together. A receives child support from a former spouse. A’s mother also lives with them and helps care for the children. B’s only child works in B’s business and both A and B hope their joint children will one day join the family business as well. A and B have a lot to discuss...

The first thing we would tell A and B about their estate plans is “don’t try to plan for the next 20 years right now.” Trying to plan for too many “what ifs” can cause analysis paralysis. The best practice is to get a plan in place that addresses the “what ifs” of the next three to five years. That’s particularly true for A and B—newlyweds with a newly blended family. That’s why Trusts are living documents—they need to be reviewed and adjusted over time as families, circumstances, and laws change. As long as you are alive and competent, you can amend your Trust. And if you don’t, well, you’ve put the right plan in place at the right time.

Currently, there are minor children involved. Were A to die, A may want or need to plan for the support and care of the children rather than B, who is likely self-sufficient and not dependent on A’s support at this early stage in their relationship. Later, when A’s children are grown and gone, A is more likely to want or need to provide for B.

B currently has to think about B’s business. In the event of B’s death, B may want to see B’s child carry on the business. If A needs an income stream from B’s estate however, an outright transfer of the business might not work. B’s options would include keeping the business owned by a Trust with income paid to A, but with B’s child still running the business and getting a salary. Or, perhaps B can obtain life insurance that would pay A and allow the business to be transferred to B's child.

Life insurance or some other income stream (retirement plans, annuities, etc.) of B are useful here. If A is significantly younger than B, or close in age to B’s child, and B plans to provide for A first, then B’s child, there could be tension. A plan that has a child “waiting around for step-parent to die” can be an invitation to discord (take a look at the step-parent vs. children disputes of celebrities like Casey Kasem, Robin Williams, and Glen Campbell).

If B has a stream of income that can be directed to either B’s child or A with the remaining assets going to the other of them, that can reduce tension. This may give the best hope for a continuing relationship between a child and a step-parent.
In the event of A’s death or incapacity, does the surviving biological parent (e.g. A’s ex spouse) have custody of the minor children? If so, A may not be able to plan for B’s involvement with the children, but perhaps leaving money in Trust with B as the Trustee will at least assure some contact and oversight. If not, A will need to carefully consider whether A’s mother or B should be named guardian of the children.

At a minimum, A will want to get powers of attorney and health care directives for minors that allow for A’s mother and B to take care of the children in an emergency, including making health care decisions for the children if A is not able to.

In the unlikely event A and B should die together, who gets what and when requires careful analysis.

A’s children are younger than B’s one child, and if they have additional children in the future, the age gap will be greater. A and B can consider a “pot trust” that holds all assets in one big pot for the benefit of all children until the youngest child reaches a certain age or graduates from college. The Trustee makes distribution for “health, education, support, and maintenance” of all the children, but is not required to do so equally. This gives the youngest child the same advantages as the older children for whom college, a car, perhaps a wedding, was already paid for prior to their parents’ passing.

When the youngest child reaches the stated age, the trust can be divided into shares for the children and distributed outright or over time when each child hits a certain age. The size of those shares is another area for discussion.

Does B’s child get half and A’s children split the other half? If A and B have a child together does that child get a portion of each half? The short-term answer is likely to be much different than the answer 20 years from now.

The decisions to be made will necessarily take into consideration whether there is a large disparity between the assets of A and B, and there are many formulas and approaches to deciding what’s “fair.”

We would say to A and B what we often say to clients: This may be the first time you’ve had to design your estate plan, but your lawyer has done hundreds if not thousands of plans. No matter how complicated you may think your family is, it’s our job to help you figure out what works best for your family, to provide some options for you, and get it all documented.
Then A and B can concentrate on the fun parts of their upcoming Brady Bunch life together. And we’d also say congratulations and best wishes! And we’ll see you again in three to five years.

If you have estate planning questions, give us call at 253.858.5434. We represent clients throughout Washington and Idaho and are available to meet in person, by phone, or via video conference.

Let's face it - death and money make people emotional. We can help resolve family disputes that arise during the estate distribution process.

Let's face it, death and money make people emotional. Old family feuds can get worse after the death of a loved one and family tensions can reach boiling point during the estate distribution process. All of this can lead to litigation. We understand that, in certain cases, litigation is the only method of resolution and we will not hesitate to advocate strongly on your behalf in court.

For many reasons probate, trust, and estate litigation can be complex. We will advise you by providing counsel on pre-litigation strategies, analyze potential risk, and documentation review. We then apply creative problem solving to secure a favorable resolution for you.

Probate, trust, and estate litigation includes disputes regarding:

* Contested Wills
* Improper disbursement of estates
* Issues regarding the personal representative, executor, or trustee of estates
* Trust litigation
* Claims against fiduciaries

We are also strong proponents of alternative dispute resolution (ADR) and legal solutions that include mediation. Whenever possible, we encourage our clients to amicably and respectfully resolve their disputes. The provisions in Washington’s Trust and Estate Dispute Resolution Act (TEDRA) allow for resolution of disputes regarding trusts and estates through out-of-court processes such as mediation, arbitration, and agreement. We have experience representing heirs as well as defending estates under TEDRA actions.

In every case we handle, we underline the importance of practical planning in order to reach a solution for your case. Proper estate planning is key to avoiding any unpleasant family feuds regarding estate distribution. Call us today at 253.858.5434 to see how we can help.

Why Estate Planning is Important for Young Families with Children

Young people with children are usually in the beginning stages of their careers, and might not have an estate large enough to be affected by the estate tax upon their deaths. In 2020, an estate must be larger than $2.193 million to incur any Washington State inheritance tax, and larger than $11.58 million dollars to incur any federal estate tax. Nevertheless, there are many non-tax reasons for people with young children to develop an estate plan. An estate plan generally refers to a Will, a Power of Attorney, and a Directive to Physicians.

A Will is a critical document which designates how you would like to distribute your estate assets after your death. Married couples, in most cases, leave their estates to each other upon the first spouse’s death, expecting that the surviving spouse will use the inherited assets to care and provide for the children. When both parents have passed and leave minor children, the distribution of estate assets becomes more complex. The following issues should be considered by parents when making their Wills:

* Who will care for minor children in the event both parents die? Naming a guardian in the Will provides the best evidence of who the parents would like to make decisions for their children. When deciding on a guardian, parents should take into account the proximity of the guardian’s residence to the children’s current home, the lifestyle and religious beliefs of the guardians, and the financial situation of the guardian. Parents should name the same guardians in their Wills so as to avoid any confusion in the event both parents die simultaneously. Guardianship of minor children is a major responsibility, and parents should be sure to ask their preferred guardian if they would be willing to care for the children in the event of a tragedy.

* How will the estate assets be transferred to the child? If the parents have no estate plan in place, upon the death of both parents, the child would inherit their share of the parents' estate, and it would be held in a guardianship account. The child would have access to the monies by requesting distributions from the guardian, who would need court approval to spend principal from the guardianship estate. Additionally, once the child turned 18, all assets would be distributed directly to the child regardless of the child’s ability to manage the money. If parents engage in estate planning, they may create a Trust to hold assets passing to a minor child. The parents, via their Will, create a Trust and name a Trustee to manage, invest, and distribute the assets to the child according to the terms of the Trust. The Trust may allow distributions for the child’s health, education, maintenance, and support throughout their life. The trust terminates at some point, and does not automatically end upon the child’s obtaining the age of majority. For example, the Trust can end when the child turns 30. Alternatively, the Trustee may distribute principal in increments based on the age of the child. For instance, the child would be entitled to 1/3 of Trust principal at age 25, another 1/3 at age 30, and the rest at age 35. The Trustee need not be a corporate Trustee, and in the event of a smaller estate, it would make better financial sense to name an individual as Trustee (who may be the same person as the guardian). The individual Trustee could then hire an investment advisor to handle the investment of Trust assets.

Parents of a child with special needs should create a Special Needs Trust to hold assets for the child with special needs. This kind of Trust is typically funded with inheritance monies of the child with special needs, and does not have a payback to the state for medical assistance provided to the child and may not make any distributions that would disqualify the child from received any governmental benefits.

* Who will administer the estate in the event both parents die? The surviving spouse is typically named as Personal Representative, and a successor PR should also be named in the event the spouse is unavailable. A PR must be over the age of 18, and is responsible for gathering the assets of the estate, liquidating and selling any assets, and distributing the assets to the heirs under the Will. Each spouse may name their own successor PR to administer their estate.

To complete the estate plan, parents execute a Power of Attorney and a Directive to Physicians. A power of attorney allows an individual (the "principal") to appoint an agent to act on their behalf for medical and financial matters. The agent is typically the principal’s spouse, and a successor agent may also be named in the document. A Power of Attorney can take effect immediately, giving the agent the authority to act on the spouse’s behalf even if the spouse is able to speak for themselves, and it also applies in the event the principal is unable to speak for themselves. By contrast, a “springing” Power of Attorney only takes effect upon the principal’s incapacity.

A Directive to Physicians sets forth a person’s last wishes in regard to end-of-life situations. This document differs from a medical POA in that the Directive only governs a situation where the declarant is incompetent, and a doctor has certified that the declarant is in a state of permanent unconsciousness or has an end-stage medical condition.

Parents with young children should consider drafting an estate plan to ensure that their estates are administered according to their wishes, and that their children will be cared for financially and be placed with an appropriate guardian. If you have estate planning questions or if we can be of service to you, your family, friends, neighbors, or co-workers, give us a call at 253.858.5434. We represent clients throughout Washington and Idaho.

Will the COVID-19 pandemic affect my personal injury claim?

The coronavirus crisis has devastated our economy in just weeks and closed many courts, prompting many of those injured in auto collisions to ask, "Will COVID-19 affect my personal injury claim?" Although the global pandemic has affected law firms like every other sector of our society, the outbreak will not fundamentally impact your personal injury claim. We are still open for business and accepting new clients, while still following social distancing rules.

WHY YOU SHOULD SEEK LEGAL COUNSEL DURING THE COVID-19 CRISIS. You should not delay your injury claim because of COVID-19. Although your claim may take longer to process than before the outbreak, the law's deadlines on when to file a lawsuit remain in place. You could lose your right to take legal action and recover compensation if you wait. During tough financial times, some people avoid hiring a lawyer. This can be a serious mistake. We expect the insurance companies to fight your claims harder than before the coronavirus outbreak. They are more likely to lowball your claims. At times like this, hiring a lawyer can be more important than ever. Unlike with other legal matters, we represent personal injury clients on a contingent fee basis, meaning we don’t ask for a retainer upfront. We only get paid if we settle your case or a win a jury verdict for you down the line.

We understand the fear as cases of COVID-19 continue to rise. Fortunately, many aspects of the personal injury process can continue online or on the phone and we will continue to work diligently to process your case and to get you the result you deserve.

KEY QUESTIONS ON WHETHER CORONAVIRUS WILL AFFECT YOUR CLAIM.

(1) Will the insurance company settle my claim during this crisis?

Yes. However, you should be aware that the insurance company will be looking at its bottom line. Some insurers try to lowball claimants who don’t fight for their rights. We believe the insurers may become even tougher to deal with. They may drag their offers down further and seek to settle auto collision claims as quickly as possible before you can obtain legal representation.

(2) Am I allowed to file an injury claim during a stay-at-home order?

Yes, the insurance companies are still open for business and should process your claim in their normal manner.

(3) Will coronavirus slow my settlement payment?

The settlement process could be delayed slightly because the insurance companies are operating with fewer people in their offices. They have many people working from home, and this creates some issues with delays. However, the insurance company should still work on your claim.

(4) Will my lawyer continue to work on my case?

We will continue to work on demands, issue letters, and research your case as before the outbreak.

WHY INSURANCE COMPANIES MAY BE HARDER TO DEAL WITH DURING THIS PANDEMIC. Insurance companies make their money off the stock market and other investments. When the economy is in freefall, these sources of money are hit hard. In times like these with the stock market down so dramatically and the economy reeling, they begin to take a very hard line on where they spend their cash. They no longer have the cushion of their investments and quickly being to lose money. This leaves few options for the insurers. They can raise insurance rates, or they can reduce what they pay toward their existing and future claims. This means the insurance companies batten down the hatches as they struggle to maintain profitability. We can expect insurance companies to become much more aggressive in their attempts to settle out at the lowest dollar possible and as quickly as they can. They want to make sure the injured party settles before having a conversation with a lawyer. It is in times like these when having effective counsel is so important. The insurance company is expecting you to settle quickly and at the low amount they determine.

The good news is that the insurance companies don’t dictate the terms. A lawyer can challenge a low insurance company offer. We can file a lawsuit and take your case to trial if necessary. You should not have to settle for less. Although the insurance company may be offering less, your medical bills won’t be any lower than they were before the coronavirus crisis.

THE EFFECT OF THE STATUTE OF LIMITATIONS ON YOUR INJURY CLAIM. Every State has a strict statute of limitations for personal injury claims. In Washington, someone who suffers an injury has three years to file a lawsuit for injuries suffered in an auto collision; in Idaho, that deadline is two years. If you miss the deadline, you lose the right to sue forever. When a lawsuit is filed and the litigation process starts, the court determines a trial date.

Three years seems like a long time but it goes quickly. Your lawyer often must make extensive inquiries to build a case. Don’t leave it until the 11th hour to contact a lawyer. Court closures due to COVID-19 will cause delays in a system that will likely be overburdened when the courts reopen. Contact a lawyer now to talk about your options.

These are unprecedented times. Although millions of Americans are staying at home, don’t let your injury claim suffer. We are open for business and we can talk about your case on the phone or video conference. We expect insurance companies to become more ruthless over the next few months. They are likely to employ more tricks to stop you claiming or to persuade you to accept a low offer. Give us a call at 253.858.5434 for advice.

Get advice from your trusted advisors, like lawyers, accountants, financial planners, and bankers, as you prepare to reopen your small business.

The COVID-19 shutdown has caused financial distress for many small businesses. Some may need to liquidate, several might be candidates for restructuring, and others may open their doors without skipping too many beats. If you suspect your business may need financial assistance when things start returning to normal, you should seek the advice of trusted advisors, such as accountants, lawyers, financial planners, or bankers soon. However, before meeting with a professional you should identify key employees and gather the information necessary to put your business in a position to successfully navigate the times ahead. Taking these steps now should make your journey shorter and less expensive.

First, identify key employees who have access to and otherwise fundamentally understand your business’s financial data and funds flow. These are the people who will be essential in gathering and assembling information that your advisors will need.

Second, identify your trusted professionals. If you don’t have a lawyer, accountant, or financial advisor, set up a few interviews. If you have established relationships with such advisors, then reach out now to schedule appointments for consultations. Understanding your options, both legally and financially, sooner rather than later will be crucial.

Third, prepare for meeting with your advisors.

ASSETS AND INCOME. You should have the company’s balance sheet and income statement for the most recent fiscal year and the current year to date. Recent tax returns and financial projections may also be helpful. If no recent balance sheet is available, then compile a list of real, personal, and intellectual property assets owned by the entity, and include the identity of co-owners of those assets. For personal property, categories might include “equipment,” “furniture,” “fixtures,” etc., and should incorporate total estimated liquidation sale value for each category. For any item with an estimated liquidation sale value of more than $600, the items should be listed separately. Recent appraisals, accounts receivable, and work-in-progress listings, machine and equipment listings or depreciation schedules, and inventory figures should also be provided.

LIABILITIES AND LIENS. You will also need a list of all creditors for the company, including banks and other lenders, franchisees, land contract vendors, landlords, taxing authorities, and vendors, with addresses and amounts owed. An accounts payable ledger may be the best place to start in preparing this list. The list should contain each person or company to whom the entity owes money, even if it is jointly obligated to the creditor with someone else. If any creditor has commenced legal or collection action, gather any papers received related to that action. Copies of communications from taxing authorities, especially tax lien documents, will also be critical.

It will be important to provide copies of all documents which evidence debts owed and the security which may be held to secure such debts, including notes, security agreements, mortgages and land contracts, as well as personal guarantees (along with any related security agreements or mortgages) which may have been given to any creditor for debts owed. Gather office or business premises leases, equipment leases, franchise agreements, supply contracts, purchase orders, license agreements, and other critical contracts. You should also be prepared to give your advisors permission to complete a search of state records to confirm the status of any liens against the company’s assets.

RECENT TRANSFERS AND PAYMENTS. You should compile a list of any creditors which have been paid more than $6,000 by the company within the last 90 days, together with the total amounts paid to these creditors during this period, as well as a list of any transfers totaling more than $6,000 made by the company to or on behalf of any officer, board member, shareholder, member or owner (or their family members) within the last two years. Bank statements and internal check registers for the last six months will also be helpful.

OWNERS AND INSIDERS. Ownership information for the business entity, including owner names, addresses, and percentage of ownership, will also be relevant, as well as copies of any insider or owner loan documents. You should also be prepared to identify all directors and officers. And of course, if there are any other facts or documents you feel are relevant to the company’s current financial condition, get that ready to present with everything else.

If you are experiencing liquidity issues, pressure from lenders, or other financial strain, and would like to explore what kinds of legal options may be available to assist your business in recovering from the damage COVID-19 shutdowns may have caused, we can provide guidance. Please contact us at 253.858.5434 if you would like to schedule an appointment.

Does your small business need legal advice in developing workplace health and safety policies to comply with Phase 2 of the State's reopening plan?

If your small business is a "professional service provider" as defined in Washington's "Safe Start" reopening plan and you need legal advice in developing workplace policies and practices to comply with the State Dept. of Labor & Industries' and the Dept. of Health's regulations for reopening in Phase 2, give us a call at 253.858.5434 to see how we can help!