Just to update you all, I have been going to the free seminars put on by various types of people, lawyers and others. I have read the NOLO press book:
MAKE YOUR OWN LIVING TRUST by Denis Clifford
Clifford practices in Berkeley, CA and received his law degree from Columbia Law School. In the text he states that his book is based on California Law, so appropriate for me. Good investment cost about $33, comes with forms in both paper and CD formats.
I've ordered and just started reviewing Quicken WillMaker Plus 2007 version. Found it on EBAY for less than $23 including shipping.
I have been in communication with an attorney that has a website which offers some free advice on Trusts. He is constrained from working for a fee at present but when he retires from his current employment I think he'll go into this line of work.
I talked with another lawyer and his fees were about $3K for a comprehensive package - not sure how many properties this would include probably just one locally. He had the attitude that clients aren't competent enough to fund a Living Trust. In California this task entails filing out a DEED that transfers the property from self/spouse to existing Trust name, then having it notarized, then recorded. This is not really rocket science - my opinion. In addition each county in California has its own version of a tax form that must be filed at the same time, again not rocket science.
The great thing about talking with this lawyer was that he was HONEST. He came right out and stated that he makes most of his money not on this front end. His income comes from the back end. This is what the attorneys don't talk about much.
On the back end of a Living Trust (AB or Disclaimer)type, after the first person dies, that person's share of the Trust has to be allocated to an irrevocable sub Trust. The attorney provides some help in this task. After that point in time, a 1041 has to be filed for every year that the Sub Trust remains in existence. Also there may be some accounting required to be provided to the final beneficiaries depending on the original intent of the main Trust.
For these back end tasks our good lawyer charges the nominal fee of one half percent of the estate's value after the first death, and then 1% after the second death.
These fees become substantial hits and in my opinion pretty much nullifies the advantage of eliminating the fee charged by Probate attorneys.
This honest lawyer indicated that these percentages would typically net him about $50K for the total process.
One learns a lot if one persists in asking questions.
I am still undecided about which path I should take, but this whole exercise is enjoyable and educational. If and when I do hire an attorney, I will have most of the issues well thought through. |
