Estate Planning Law Firm of Louisiana

When are Grandchildren Forced Heirs in Louisiana?

Louisiana is the only state that has forced heirship. Forced heirship requires that children 23 or younger, or children of any age who are permanently incapable of "taking care of their persons or administering their estate," must inherit a portion (usually one-fourth) of their parent's estate. There are also two circumstances where your grandchildren would be forced heirs and required to inherit from you regardless of what you write in your Will: If your deceased child would have been 23 or younger when you die, then your deceased child's children are forced heirs. This does not occur too much. If, when you die, your deceased child has a child or children who are permanently incapable of "taking care of their persons or administering their estate," then those grandchildren are your forced heirs. There is a whole lot more to the Louisiana forced heirship laws than what I wrote above. I simply wanted you to know that there may be circumstances where grandchildren can be forced heirs. If you have any questions about this, feel free to comment to his post or send me an e-mail at paul@rabalaislaw.com. Thanks. Paul Rabalais

Understanding the Louisiana Surviving Spouse's Marital Portion

In Louisiana, when a spouse dies rich in comparison with the surviving spouse, the surviving spouse is entitled to claim the "marital portion" from the succession of the deceased spouse. While there is no concrete test, it is generally understood that if the deceased spouse's assets are more than five times the surviving spouse's assets, the surviving spouse will ordinarily be awarded the marital portion. So, how much does the surviving spouse get? If the deceased died without children, the surviving spouse gets one-fourth of the deceased spouse's estate; If the deceased died survivived by three children, the surviving spouse gets the lifetime usufruct of one-fourth; and If the deceased spouse died survived by more than three children, the surviving spouse gets a child's share in lifetime usufuct. In no event can the marital portion exceed $1,000.000 Example. Rich Husband dies (survivied by three children and Poor Wife) with $3,000,000 of separate property. He and Poor Wife have $1,000,000 of community property. His estate is $3,500,000. Her estate is $500,000. He has 7X what she has. She qualifies for the marital portion. In his Will, he leaves his entire estate to his children (or to anyone other than Poor Wife). She is entitled to the lifetime usufruct of $875,000. She must file a claim for this within three years of his death or she loses this right. If you have questions about a marital portion claim, post a comment or send me an e-mail to paul@rabalaislaw.com, and I'll see if I can help. Paul Rabalais

Surviving Spouse Can't Sell The Family Home Without Legal Help

We get lots of calls from surviving spouses inquiring about transacting the family home after the death of their wife or husband. Perhaps they want to sell the home to move into something smaller (or bigger). Or perhaps they want to refinance the mortgage (or take out a new first or second mortgage). One of two things must be done so that the surviving spouse will have this authority: Appoint an executor or administrator. Have the surviving spouse named as executor or administrator of the deceased spouse's succession. If the deceased spouse had a Will, the Will likely would have named and executor - ofen the surviving spouse. If the deceased spouse had no Will, then the surviving spouse can petition the court to be appointed as the administrator of the succession. Getting this done typically gives the surviving spouse the authority she needs to transact the family home (or other succession assets). Complete the succession without an administration. If there are no complicating factors, a succession can be completed without an executor or administrator being appointed. A judge will sign an Order which requires that the home and succession assets be transferred to the appropriate heirs. If the surviving spouse is inheriting ownership of the deceased spouse's interest in the home, then the surviving spouse will have the authority to transact it. If the husband died without a Will and he had children, then the surviving spouse will need the consent of the children to sell the home. If you want to know what your rights are in succession property, feel free to send me an e-mail and I'll be happy to respond and advise you on your rights and obligations. I get e-mails often from heirs who are confused about Louisiana succession law. I usually help straighten it out - in simple terms. Just e-mail me at paul@rabalaislaw.com Until next time, Paul Rabalais

All You Ever Wanted To Know About the Detailed Descriptive List

Yesterday, I wrote a chapter of my new book. I don't yet know what the name of my book will be but the content will be based on settling an estate in Louisiana. There's so much confusion out there among the general public regarding how estate's get settled, so I'm writing a book (my 2nd) to help people like you eliminate confusion.

The chapter that I wrote yesterday was all about what's called the "Detailed Descriptive List." It is probably the most important legal document prepared after a person dies. It's a detailed list of all the assets and debts that the deceased had on the date of his or her death. Assets included on the detailed descriptive list include:

• Lousiana real estate
• Bank accounts
• Investment accounts
• Vehicles
• Business interests

Certain assets are excluded from the Louisiana succession and are typically omitted from the detailed descriptive list. These omitted assets include:

• Out of state real estate
• Individual Retirement Accounts (IRAs)
• 401(k)s
• Life insurance
• Annuities
• Co-owned U.S. Savings Bonds

Too many detailed descriptive lists are prepared in error from the start and then we have to go to court to fix them. Make sure you get it right from the start. If you want to know more about how a succession works, or if you'd like me to answer any questions you have, send me an e-mail at paul@rabalaislaw.com, or give me a call at my office at (225) 329-2450.

Until next time...

Paul A. Rabalais

How Does a Succession Work in Louisiana?

There is tons of confusion among ordinary Louisiana folks about how a Louisiana Succession works. People often get confused about the difference between a succession the is "administered" versus a succession that is handled "without administration."

The simplest successions are handled without an adiministration. If all of the heirs are competent, and all heirs agree to accept the succession, and the succession is relatively free of debt, then we will prepare all of the succession pleadings, and all of the heirs will agree on the assets, debts, and distribution of the estate. After all of the legal pleadings have been signed by all of the heirs, and filed at the courthouse, a judge will sign a "Judgment of Possession," which orders third parties to transfer assets into the heirs' names.

In all other successions, there will be an administration. An administration is required when:

• An executor of the will (or administrator if no Will exists) must be confirmed by the court to handle necessary estate matters;
• Someone contests a succession matter;
• Succession assets need to be sold so the proceeds may be divided among the heirs;
• All of the succession funds need to be collected and deposited into a succession bank account prior to their distribution;
• Someone needs access to succession funds to pay succession debts and other administrative expenses; or
• For any other necessary reason.

If you'd like to find out whether a Louisiana succession should be "administered," simply shoot me an e-mail at paul@rabalaislaw.com, or post a comment to this Post, or give my office a call at (225) 329-2450.

Until next time...

Paul Rabalais

Add Child's Name To Bank Account: Keep It Simple

You may want to consider adding a child's name to one of your bank accounts so that child will have signature authority over your account.

Example: Mom has three bank accounts: a checking, a savings (with a $30,000 balance), and a CD. When Mom dies, there are $15,000 of funeral and other costs that need to be paid immediately. No one has access to Mom's accounts to pay these costs. If Mom had added a child so that the child can access the savings account, then when Mom dies, the child can access the account to pay the necessary funeral and other costs after Mom's death.

Adding a child so that the child has signature authority on the account doesn't mean that the child owns part of the account, and it doesn't mean that the child owns the account when Mom dies. When Mom dies, the money is part of Mom's estate and must be distributed to Mom's heirs. Adding the child may make it simpler, however, for the child or children to pay immediate and necessary expenses after a parent's death, particularly when the succession is uncontested.

Paul Rabalais

Death Certificate Not Needed For Succession

Many surviving family members come into the office shortly after the death of a loved one. They think that the succession cannot begin because they have not received the death certificates yet.

A death certificate is not necessary to complete a Louisiana successsion. Proof of death is obtained typically by two family members signing a "Affidavit of Death, Domicile, and Heirship."

The death certificate may be required to transfer accounts at financial institutions. This transfer, however, typically does not take place until after the succession is complete and the judge has signed the appropriate "Judgment of Possession."

If you are not sure what must happen in a succession, give us a call at 225-329-2450, or send me an e-mail at paul@rabalaislaw.com

Paul Rabalais

Executor's Duty Regarding Succession Funds

We often get a question similar to, "My mother died and I was named as the executor of her Will. What am I supposed to do with her money prior to the estate being settled?"

Answer: Louisiana law provides that you are supposed to deposit all of her money into a succession bank account in Louisiana, and withdraw the funds only in accordance with the Louisiana Succession laws. If you don't comply with this provision, a judge can render a judgment against you and require that you pay 20% interest annually on the amount you did not handle properly. You can also be held liable for all damages suffered and you might be dismissed from your duties as executor.

I was involved in one case where the judge did just that. The co-executors put their father's money in their personal account after the father died. The judge ruled that they would have to personally pay 20% interest annually on those funds.

Moral of the story! Know your rights and obligations as an executor or an administrator. Even better, make sure your executor knows his or her rights.

Paul Rabalais

Avoid Accidental Disinheritance

Accidental disinheritance is a growing problem. It's a problem, in part, because there are too many death-disposition instruments now that dispositions are slipping through the cracks to the wrong people.

The proliferation of wills, trusts, IRA beneficiary designations, life insurance and annuity beneficiary designations, pay-on-death accounts, and account survivorship options creates too many unintended circumstances.

Unintended consequences also result from:

1. Failing to Update Your Will. Laws change every year. Your life changes also.
2. Bad Last Will. Anna Nicole Smith did not include her recently born child. She left her entire estate to her son who had died months before her. I'm involved in another case where a father left his estate to his "children," but didn't tell the lawyer who wrote the Will that he wanted to leave his estate to the two children that he had a relationship with, and not the other four biological children that he had not spoken to in years.
3. Disinheritance by Remarriage. Dad dies and Mom remarries. Mom writes a "simple" will and leaves her modest estate to her second husband. Mom dies, Mom's estate goes to her second husband. Then when second husband dies, guess where it all goes? That's right, it goes to second husband's children. Mom and Dad's children get zippo.
4. Disinheritance of Spouse by Failing to Plan. In Louisiana, if you don't write a Will, your assets will bypass your spouse in favor of your children or siblings. Your separate property goes to them outright, while your community property goes to your children subject to your spouse's usufruct - but your spouse can't sell assets without your heirs' permission.
5. Disinheritance From Too Many Death-Disposition Instruments. Let's say most of your wealth is tied up in IRAs. After your spouse died, you named your children as your IRA beneficiaries. When you later remarry, you set up your Will to include your new spouse. When your die, your spouse gets little or nothing because your Will doesn't control where your IRA goes at your death.

Well, I'm not going to present a problem without a solution. So, what do you do? Simple - own one of our VIP Memberships. As a member, you'll recognize the following benefits:

• Free Updates for Life. Due to law changes or your life changes.
• Free Annual Review of Your Assets. We'll monitor your estate to avoid estate tax, protect your estate from long term care costs, and the transfers at death will be fast and easy.
• Keep Peace. Take advantage of our "No Contest Clause" and our system for distribution of personal effects that have sentimental value to your heirs - NO FIGHTING!
• Make a PRICELESS video to transfer your values, experiences, feelings and proudest moments to future generations. My parents did this and it's AWESOME. I look forward one day to introducing my grandchildren (who don't exist yet) to their great-grandparents.
• Completely avoid attorney succession or probate costs at your death
• Attend, listen to on CD, or watch on DVD, monthly workshops on estate planning and aging related topics from community leaders
• Get answers to your commonly asked questions from your Members Only site.
• And more...

Just give me a call (225-329-2450) or send me an e-mail at paul@rabalaislaw.com, and we'll get you plugged in after answering any questions. Until next time,

PAR

Transfer Inherited Land To Limited Liability Company

Finished up the paperwork on a succession yesterday. The three children were all in the office. They had inherited some acreage and a piece of rental property from their parents. They were concerned about their potential liabilities in case someone was injured on their inherited property.

We formed a limited liability company (LLC). The three children will transfer their interest in the property to the LLC. This may help protect the children's personal assets. If someone gets injured on LLC property, they may attempt to sue the owner of the property (the LLC), and the children will not be personally responsible for LLC debts.

Most people who acquire rental property these days - due to liability concerns - don't own the property themselves. They form an LLC and have their LLC own the property. Let us know if you have questions, comments, or experiences related this type of thing.

PAR