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Recent Blog Posts
Illinois Tax Exemption Increases in 2013
According to a report at Mondaq.com, there have been several changes that have been made this year to Illinois legislation when it comes to matters of estate planning. These changes, if not followed can find Illinois residents paying out more than they need to in taxes. These changes were implemented January 1, 2013.
There a a few key changes that make the amounts at the state and federal level differ. The Illinois estate and generation skipping tax exemption amount is now $4 million while the federal amount is $5.25 million. The federal estate tax exemption has been adjusted to deal with inflation and has increased over $200,000 since 2011. The Illinois tax exemption has not been adjusted to deal with inflation at all.
The estate tax rate has been capped both on the state and federal levels. The maximum with the state is 16% while the federal maximum is 40%. These are only a few of the changes. Some of these changes will affect some people and not others, so consult with your DuPage County estate planning lawyer if you have questions about how it will affect you.
Events Now Helping You Celebrate Divorce
For a long time, there has been a stigma surrounding divorce that can make it difficult for individuals to share their feelings. A new trend is helping individuals come to terms with their divorces and celebrate the movement forward as a ceremony. A recent upsurge of divorce celebrations and ceremonies is gaining ground across the country, allowing many going through divorce to seek closure and bring light to how divorce can change a person's life.
The extent of these divorce celebrations and ceremonies runs the gamut from events just like a bachelor party to a completely formal sit-down dinner. As the owner of Crucible Life Resources in Toledo, Ohio, Bill Roman says he has seen it all. The main focus of these divorce celebrations tends to be around an emotional release regarding the final approval of the divorce decree. Many times, the people in attendance for divorce celebration are often the same people who attended the wedding. Former bride and groom celebrate with gifts, humorous cakes, and funny events to mark this new stage in their life.
Protecting Your Identity Even After Death
The Internet puts knowledge at the tips of your fingers. But unfortunately it also allows thieves to gain access to Social Security numbers and other private information. But in recent years, this practice does not only target the living, but the deceased have become the preferred victims.
The thieves gain access to this information from obituary notices and other files online. Some reports confirmed that for as little as ten dollars, anyone can buy the Social Security number of a departed person. With that info, they can apply for loans, collect tax refunds, open up credit cards, and other things which require a Social Security number. Current research suggests that each year 2.5 million deceased individuals have their identities stolen.
There are tips to protect your family as part of your estate plan, which can be provided to the executor of your will. The first step is to limit the information which is included on the obituary. Without date of birth, middle name, address, or other information, it will considerably harder to steal the deceased's financial information.
John Cleese Auctioning off Memorabilia to Help Pay Alimony
British actor and comedian John Cleese is arranging to sell films props and signed photos that he has collected through the years, including a helmet that Cleese wore during two "Monty Python" films and two photo of himself alongside other Monty actors, both of which have been signed.
According to an article in the Christian Post, Cleese, 73, is auctioning off the memorabilia in order to help pay his $1 million per year alimony to his third wife, American psychotherapist Alyce Faye Lichtenberger, whom he divorced in 2008 after 16 years of marriage. As part of the multi-million divorce settlement, Cleese was ordered to pay his ex-wife $13 million in cash, as well as sign over an apartment in New York and a house in London to her. He also must pay the $1 million in alimony until 2016.
Cleese launched a stand-up comedy tour in 2009 called the Alimony Tour to help raise money. He moved to Monaco, in an effort to avoid paying a huge tax bill on his divorce payments. Cleese also sold his California beach house. The items for sale are being auctioned off on the Original Memorabilia Company website. This is the same site where Cleese sold his 1987 Bentley Eight. As part of the deal he agreed to have lunch with whoever bought it and give a handwritten story of some of the car's most famous passengers, including Jamie Lee Curtis and Kevin Kline, his co-stars from the film A Fish Called Wanda.
Estate Sales
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With Same-Sex Marriage Comes Same-Sex Divorce
It was like Valentine's flowers for same-sex couples in Illinois when earlier this year the Democratic-led Senate passed legislation "for the first time that would allow same-sex marriage in Illinois," according to the Chicago Tribune. The Tribune speculated that Gov. Pat Quinn would in fact sign the bill into law if it ever reaches his desk, but according to the Huffington Post, the bill has yet to pass in the state House, where the battle is expected to be much tougher. In mid-May, reports the Huffington Post, "phones in key districts have been ringing with "robocalls" both backing and opposing marriage equality in the Prairie State." Chicago Bears player Brendon Aynabadejo is heard in one of the automated calls, saying that, "it's time to take those steps once again in Illinois. We need to let the world know that Illinois accepts all people regardless of who they love," reports the Huffington Post.
Estate Planning and the American Taxpayer Relief Act
The new tax code and law has many people thinking that only the very wealthy need to worry about estate planning and estate taxes, according to The New York Times. The federal tax on estates, according to the Times, is now $5.25 million, or $10.5 million for a couple, which seems far out of the range of most people's assets. And yet the American Taxpayer Relief Act, passed in January of this year, has effects far greater than just to change the federal tax rate of estates. "Many people may not want to think about how the changes… could affect them," according to the Times. "But if they don't, they may be shocked come next year's tax season. Or worse, they may end up making financial plans based on a cursory understanding of what the changes mean for them and regret it later."
Because of this, it's important to review the changes to the federal tax code under the American Taxpayer Relief Act and figure out just how they affect you. It's true that the exemption was raised—a fact that caused quite a bit of political rancor. Yet according to the Times, "the tax rate fell from 2001 until 2010, when the estate tax disappeared for most of that year. When the tax returned in 2011 and 2012, the exemption was set at a historically generous $5 million indexed for inflation and a 35 percent rate above that."
How Much is Your House Worth in Your Divorce?
One of the most valuable assets that couples tend to own is their primary home. No matter how you plan to divide the marital residence in the divorce, you will need to know its value. In today's housing market, which reportedly is starting to recover, it may be unclear whether your home is worth what you paid for it or if you are "underwater" on your mortgage. A recent Huffington Post article detailed the ways that a home can be valued during a divorce.
One of the most common ways to determine your home's value is to have a formal appraisal done. A licensed appraiser can probably give you the most reliable figures about the value of your home. The downside of an appraisal is that it may cost several hundred dollars. However, getting a true picture of your home's value can save you thousands as you are negotiating your divorce settlement. For instance, if you want to remain in the home and an appraisal shows that the house has declined in value, then you will owe your soon-to-be-ex-spouse less in equity. Likewise, if your spouse plans to remain in the house, an incorrect valuation of the home can result in you losing out on equity to which you are entitled.
Types of Living Trusts
A living trust is a trust that is created and operated during the grantor's lifetime. There are two different types of living trusts. The first is a basic living trust, which can be used for an individual or a couple. Second is a living trust with marital life estate, or an AB trust. After the grantor's death, a basic living trust allows your property to avoid probate and pass to your beneficiaries quickly and efficiently. It is used to avoid probate. Probate is "the official proving of a will," according to Wikipedia.com. To create a basic living trust, you have to transfer some or all of your property to the living trust. You instill yourself as the trustee so you won't be giving up any control over your property. If you and your spouse create the trust together, than you will be co-trustees. After your death, the person who was named in the trust document will transfer ownership of the property to whomever you declared in the trust. An AB trust should only be considered if you own property that is worth $650,000 to $1 million worth of property. If you don't establish a living trust, there may be a big estate tax bill after you die. An AB trust lets you pass the maximum amount of property to your beneficiaries after you or your spouse dies. Each spouse leaves most or all of their property to a "marital life estate trust." When one spouse dies, the other spouse can use that property, but won't own it. When the second spouse dies, the property will not have to pay an estate tax because the second spouse never owned it. If you or anyone you know is thinking about establishing a living trust, be sure to contact a lawyer. Call an experienced Illinois Estate Planning Attorney.Image courtesy of koratmember/Freedigitalphotos.net
Orders of Protection
Orders of protections are used in case of domestic abuse or violence, which is when the abuse occurs within a household. The Illinois Domestic Violence Act defines what is considered to be within the household and what is considered to be abuse as follows: Households include:
- spouses and former spouses,
- parents,
- children and stepchildren,
- personal assistants of disabled people,
- people who are dating or are engaged to the immediate family,
- anyone who has children in common with the family
- people who have or do share a home with the family.
Abuse includes:
- any physical abuse such as pushing, hitting and forced sex,
- making someone watch the abuse of another person,
- denying care to a disabled person,
- harassment
- forcing someone to do something that they don't want do to.
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