Kevin S. Brady, Attorney At Law, PLLC

The Pause That Refreshes.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Sat, 26 Sep 2026 22:00:00 +0000

I am at the juncture in my career, and life, where I need to downshift. At this time, I am pausing my law practice, in order to focus on other endeavors in my life. Is this "retirement"? Maybe, but I am keeping my options open. Kind of one foot on either side of the retirement line. I maybe very well restart my practice at a later date. Or I may call it a day entirely and retire.

Therefore, until further notice, I will no longer be accepting new clients, nor will I be providing any representation.

For now, I plan to keep my law license active, in case I decide to restart my practice at some point down the road. I will continue to maintain custody of files of my previous clients' matters, for a duration of 6 years after completion of representation.

From time to time, I will continue to post articles on this blog, pertaining to estate planning, professional development, and other topics that may be of interest to others.

If you are in need of legal representation, here are some helpful resources in Minnesota you can turn to, to find legal counsel.

Minnesota State Bar Association Lawyer Referral.

Minnesota Lawyer Referral.

FREE On-Demand Video CLEs.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Sun, 17 Aug 2025 00:09:00 +0000

It's August, that time when one-third of Minnesota attorneys will be entering their next CLE reporting period. As many of you know, in 2020, the Minnesota Supreme Court issued an order, allowing attorneys licensed in the state to claim more on-demand video CLEs toward their 45 required credits. The court order initially raised the allowed on-demand credits from 15 to 30. The order further stated that the allowed on-demand credits would become unlimited as of January 1, 2024, for courses viewed and reported after that date. Thus, Minnesota licensed attorneys are now allowed to apply approved, on-demand CLE credits toward their ENTIRE 45 credit requirement every three years.

This creates a wonderful opportunity for Minnesota attorneys looking to streamline their acquisition of needed CLE credit, while still improving their practice skills, adapting to changes in the law, and maintaining the same high level of their own professional development. It's particularly helpful for practitioners who live and work outside the metro, and those attorneys working from home.

Fulfilling this is now easier than ever and doing so is more within reach of attorneys who are trying to limit their expenses. Money's tight these days, but you don't need to compromise on your professional requirements. It's win-win.

It's becoming easier (at least at the time of this writing) to find coveted Elimination of Bias and Ethics courses, along with courses in the new Mental Health category.

It is now possible to obtain most, if not all, of one's CLE requirement for free or low-cost. The Minnesota State Bar Association is offering an unlimited season pass for access to all of their on-demand CLE content. The cost for this is $550 for members, $950 for non-members. If you buy this pass at the tail end of your 3-year reporting period, it is possible to fulfill your present reporting period and also the next reporting period--6 years of coverage.

For those looking to save even more, a number of places offer free on-demand CLEs. I will list a few sources:

Mitchell Hamline offers dozens of free, on-demand video CLEs to alumni, including several from Mitchell Hamline's Health Law Institute.

The Hennepin County Law Library offers several live streaming and on-demand CLEs free of charge to anyone. You just need to submit your name to ensure CLE credit.

St. Thomas School of Law offers several on-demand CLEs, many of which are free for all. A sign in is required.

The Minnesota Attorney General's Office offers several free CLEs, both in-person and on-demand. They also offer some paid on-demand courses, for modest fees.

Practitioners' Corner: Belly Up To The CLE Buffet And Knock Out Two Reporting Periods.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Fri, 21 Mar 2025 16:56:00 +0000

If you're a Minnesota attorney, you may be looking to find more efficient and cost-effective ways to acquire your necessary CLE credits. Prior to Jan 1, 2024, a practitioner could apply up to 30 hours of approved on-demand video credit out of the 45 hours total needed for a 3-year reporting period. However, for on-demand CLEs viewed and reported after 1/1/2024, there is no cap on the hours of credit. That's right, folks, you can satisfy your entire 45 hour CLE requirement for the upcoming 3-year reporting period, from the comfort of your home or office, at whatever times are convenient! If you want to knock out CLEs while in your pajamas at 3AM, no one's stopping you.

Here's where my idea comes into play. Getting those CLE credits, whether on-demand or in-person, scheduled into your busy life. And save some money, while you're at it. There's a method I've done a couple times, and I know of other attorneys who have done it, as well. Don't worry, it's all legit.

For practically forever, Minnesota CLE has offered Season Passes, a sort of prix fixe, all-you-can-eat buffet of CLE presentations. The Season Pass lasts one year, and they have three flavors to choose from: In-Person Pass, Online Pass, and a Super Pass that encompasses both in-person and online CLEs. The Season Passes range in price from $1295 to $1895, with a discount if you're a MSBA member or have bought a Season Pass before. If you're a new lawyer, admitted to the bar for less than 5 years, you get the pass for half price.

So here's the cool part. There is no reason why you couldn't use one Season Pass to cover two reporting periods. Yes, you can satisfy 6 years of CLE reporting in one fell swoop. You just buy the Season Pass 6 or so months before your current reporting period runs out. Attend or view the 45 hours of CLEs, then report that summer. Then when your new 3-year reporting period starts, you have 6 or so months to take another 45 hours of CLEs, thereby satisfying your reporting requirements again.

The Federal Estate Tax Exemptions Will Be Changing.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Mon, 26 Aug 2024 20:27:00 +0000

Federal estate tax code allows for an exemption for estate taxes due after a person's death. This exemption has been increasing annually over the past several years, and is currently $13.61 million for an individual and $27.22 million for a married couple. This exemption is the amount the federal government allows each person to pass to non-charitable and non-spouse heirs before any federal estate tax is owed.

Beginning on January 1, 2026, the federal exemption for estate taxes will be reduced. This change is not due to recent law changes, as it was built into current law. The law included a sunset provision that would roll back the exemption after the end of 2025. After the law's sunset, we can expect these exemptions to be cut in half in 2026, to approximately $7 million for an individual's estate and $14 million for the estate of a married couple. It is possible that Congress could act on this before 2026, but it appears unlikely, and one should not count on that.

Note that Minnesota's estate tax exemption stands at $3 million for an individual and $6 million for a married couple. At this time, there is no Minnesota tax law provision changing those exemption amounts.

While exact numbers for the 2025 exemption have yet to be announced (it's based on inflation), it is estimated that next year's estate tax exemption will be approximately $14 million per couple. What this means is that if your estate is valued at greater than $7 million or $14 million for a couple, you may need to make some plans before the end of 2025.

There are a number of ways you can shelter some of your estate assets while you are still alive. For example, you can set up trusts, give to charities, or give gifts to people. It should be noted that there are no plans at this time for the federal government to reduce the annual gift tax exclusion, which is $18,000 per person gifted per year.

The impact of these changes can be complicated, and can vary based on many factors. The sunset deadline is approaching and will be here before you know it. It would be wise to seek the advice of a qualified estate planning attorney and a qualified financial planner.

Simultaneous Deaths Of Both Spouses.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Fri, 23 Feb 2024 18:54:00 +0000

The chance that two spouses would die at the same time is very slim. Nevertheless, it is a non-zero risk and, painful as it may be to think about it, such a tragic situation should be considered when making your estate plans.

Under the common law, if two spouses died close to the same time, it had to be determined by medical evidence which person actually died first, even if the deaths were only a few moments apart. The estate of the spouse that died first would pass to the second spouse, and then the second spouse's estate (which is combined with the first spouse's estate) would pass to the second spouse's heirs. This scenario required two probates!

However, it is often impractical or even impossible to determine the order of two deaths with any certainty.

Enter the revised Uniform Simultaneous Death Act, which Minnesota incorporated into its Probate Code in the 1990s. Under this Act, if two spouses die within 120 hours of one another, and there is no Will, the law treats each spouse as having predeceased the other. Therefore, the law views it as a simultaneous death, even if the two spouses died up to 120 hours apart. Then, the probate court applies the laws of intestacy to determine which beneficiaries will share in the two spouses' combined estate.

Having a poorly-drafted Will isn't always helpful, and in fact can complicate things. If each spouse's Will names the other spouse as sole beneficiary, without clearly naming contingent beneficiaries, problems can arise. The Will does not give instructions as to how the combined estate is divided by the couple's descendants, and the probate court must apply the laws of intestacy to distribute estate assets.

Here's where things can get even more complicated.

Suppose the couple have a blended family, i.e., each spouse has children from previous relationships. Each spouse has a Will, favoring their respective children. Perhaps these Wills were executed by each spouse before they were married, and they never executed new Wills after they were married. If both spouses are deemed to have died simultaneously under the law, whose children receive shares of the estate? The outcome is uncertain.

For example:

Adam and Betty get married. Adam has a son from a previous relationship, and Betty has two daughters. Adam and Betty each have Wills executed before they got married, and they never got around to getting new Wills.

Then, a terrible tragedy strikes. Betty dies right away, but Adam lives 3 more days. Under the law, the probate court treats Adam as having died before Betty, and Betty as having died before Adam. Simultaneous deaths.

Whose children receive shares of Adam and Betty's combined estate? Again, an uncertain outcome. There may also be uncertainty for any gifts to individuals outside the family, charitable donations, etc., if the two spouses' Wills differ on those issues.

To prevent that, Adam and Betty could have had Wills drafted that names one of them to have survived the other, and the Will of the presumed "surviving" spouse would govern as to contingent beneficiaries. There may be some tax benefit in doing this, as well.

* * *

If you do not have an estate plan, or your existing plan is dated or you're just not sure, it would be wise to seek a qualified Minnesota estate planning attorney.

Why Do People Put Off Getting An Estate Plan?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Fri, 19 Jan 2024 01:21:00 +0000

I hear many reasons--excuses, really--why people are hesitant to having an estate plan drafted. Here are a few common objections:

"I don't need one now, I'm too young."

A well-crafted estate plan is not just for older people. Unfortunately, people can die at any time. It would be wise to have a valid estate plan in place, regardless of your age.

"I'll deal with it later."

Sure, life's hectic, with careers and family responsibilities. However, it doesn't take a lot of time to have a qualified practitioner craft an estate plan that helps ensure your assets go to those you want to receive them.

"I don't have enough assets for an estate plan to matter."

Even small estates can and should be protected. Sentimental or family heirlooms are important, even if their monetary value isn't great. Even if you don't own real estate or have large monetary assets, you still should consider protecting the assets you do have and make sure your loved ones would receive them if something happened to you.

Keep in mind that many disagreements happen over modest estates.

"My kids will just sort things out when I'm gone."

If you don't have a valid will, Minnesota intestacy law decides where your assets go after you die. The law generally follows "next of kin," but that may not be what you want. Maybe you wish to give assets to children unequally, or perhaps leave out one who is estranged or has addiction issues. Intestacy doesn't factor that in. Want to leave something to a close friend? Sorry, that cannot be done without a valid estate plan. Would you like to donate to a charity? Without a valid estate plan that won't happen.

Another issue to consider is who will be responsible for administering your estate when you're gone. Without an estate plan to nominate a person or persons to be the Personal Representative of your estate, it may be up to the probate court to make that decision. The person they appoint may not be one you would choose--perhaps even a total stranger.

"It costs too much."

A basic will is a very powerful instrument and can be very affordable, especially when you consider the time and expense your loved ones would endure if they have to sort through your assets, deal with the probate court, etc. (See intestacy, above)

"I'm not comfortable talking about death-related issues."

It's never easy. Talking about your death can be unnerving. Wouldn't you rather solve this issue now and not have to worry about it later? Having an estate plan in place can bring peace of mind.

* * *

Protecting your hard-earned assets means having confidence in knowing that those you care about will receive them. There's no time like the present. Contact a qualified Minnesota estate planning attorney to find out how to get your estate plan started.

"If I Die Without A Will, Is My Ex-Spouse Entitled To Any Of My Estate Assets?"

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Tue, 02 Jan 2024 02:26:00 +0000

The short answer: No.

If you die intestate (leaving no valid Will), Minnesota's intestacy laws exclude ex-spouses. Therefore, an ex-spouse is not entitled to your estate assets. Instead, your assets would be distributed based on the state's intestate succession law: to current spouse, children, parents, siblings, etc. Next of kin.

However, if your divorce decree requires division of marital property and you still have any of that property when you die, your ex would have legal claim based on the decree.

For example: if the decree requires dividing proceeds from selling the house, but you die before the sale is completed, your ex-spouse is entitled to the share of the property, per the terms of the divorce decree. Thus, your ex could make a claim against your estate in probate court.

As you can see, these types of scenarios are governed by the terms in the divorce decree.

Another issue would arise if your divorce is not final at the time of your death. You would still be legally married at that time, and your spouse would be entitled to at least a spousal elective share under Minnesota law. And if you have no valid Will, guess what? The intestacy laws put your spouse at the head of the line for inheriting your estate assets.

If you are divorced and you haven't already done so, it is a good idea to review your financial instruments that have named beneficiaries, such as insurance policies, retirement plans, investments, and assets with payable-on-death provisions such as bank accounts and real estate. Your ex-spouse may still be named as a beneficiary and you may wish to change that. Fortunately, Minnesota law automatically revokes the beneficiary designation of an ex-spouse, so revisiting those instruments is mainly a matter of naming new beneficiaries.

Finally, if you have Power of Attorney or a Health Care Directive that names your ex-spouse as a fiduciary, you may wish to review those documents. Minnesota law also automatically revokes the fiduciary status of an ex-spouse, so revisiting those allows you to choose new fiduciaries.

* * *

If you are recently divorced or are currently in the divorce process, it would be a good idea to seek out a qualified attorney to discuss your estate planning needs. Your divorce attorney should have some knowledge of how your estate could be impacted by divorce, and they may be able to help with some of those concerns. However, it would be wise to seek separate estate planning counsel to ensure all of your estate-related issues are addressed and up-to-date.

Things To Consider When Choosing A Personal Representative.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Wed, 06 Dec 2023 00:50:00 +0000

When putting together your Will there are many "moving parts" to think about. Your assets, who you want to receive them, who gets what, and so forth. But who do you want to manage your estate after you pass? Oftentimes, the thought behind naming a Personal Representative (aka, "executor") is given short shrift. "Oh, I'll just have my daughter or son do that" is a common response I hear when I ask a client about the subject.

The choice of your estate's Personal Representative is something that should be given much serious thought. After all, that individual will be responsible for distributing your valuable assets after you pass.

The job of Personal Representative is three-fold:

Collect and protect estate assets,
pay valid debts of the estate, and
distribute any remainder to the beneficiaries named in the Will.

Keep in mind that your choice of Personal Representative is that of nominee. Legally, they do not become the official Personal Representative until the probate court appoints them as such. A person who is at least 18 years of age and is someone the probate court has not disqualified may serve as a Personal Representative.

Serving as a Personal Representative is not a job to be taken lightly. Nor should you take lightly the choice of who to entrust with that responsibility.

Some factors to think about when mulling over your possible choices for a Personal Representative:

Is the person trustworthy? The Personal Representative is a fiduciary and they have a duty to always act in the best interests of your estate. Are you confident that they will do the right thing? Does the person have money or substance abuse issues that might be of concern?

Do you see any potential conflicts of interest? Minnesota law does not prevent a beneficiary from also serving as a Personal Representative. Nevertheless, will your Personal Representative be able to look past their personal interests and needs and focus on what's best for the estate?

Does the person have good interpersonal skills? Do they have the mettle to work with sometimes difficult people, such as creditors, debtors, bureaucrats, and impatient family members?

Does the person possess good organizational skills and pay attention to detail? Can that person be able to keep track of assets, bills, accounts, and other day-to-day needs of the estate?

Have you considered the practicalities facing the person serving? Do they live far away, have busy careers, family obligations, etc., that might create a hardship for them? Serving as Personal Representative takes a lot of time and diligence, even with "modest" estates.

Will grief cloud their vision or their ability to do the job? Will it be too much for them to handle?

Do you know one or two trustworthy persons (who also meet the above criteria) who could serve as alternates in the event your first choice cannot or will not serve?

Before choosing someone to serve it is always best to talk with that person first. Tell them what the job entails and what is expected of them--be candid. Give them time to think it over and let them discuss it with their family members. Don't be offended if the person declines serving--it's for the best if they don't have their heart in it.

When Should I Update My Will?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Mon, 24 Jul 2023 17:06:00 +0000

No matter how carefully your Will is crafted, it's impossible to predict future life events. Life events that could give cause for the need to revisit, and amend or re-draft your Will.

Here is an outline of some events and life changes that may require having a qualified attorney review your existing Will with you.

Change in marital status. Marriage, divorce, or having a domestic partner who would not be entitled to receive a share of your estate under laws of intestacy.
New children/grandchildren, either by birth or through adoption.
A child who has reached the legal age of majority, and no longer needs to have a custodian under UTMA.
Moving to a new state.
Death or change of relationship with a beneficiary. Perhaps one has become estranged, or has developed issues with substance abuse, gambling, etc.
Death or change with one or more fiduciaries. A nominated Personal Representative may no longer be able or willing to serve, or is no longer someone you wish to have in such a capacity.
Changes in status of guardians/conservators. Are these persons still appropriate for those roles?
Changes in real property ownership. You bought a new home or vacation property, or sold the like.
Changes in financial situation. Increase/decrease in earnings, retirement, public assistance, new health expenses, etc.
Changes in asset valuation. Large estate assets, like real property, investments, valuables, can fluctuate, affecting how you may wish to distribute them after you die.
Opening/closing a business venture.
Changes in tax laws.
Changes in state laws that may impact your estate planning wishes.
More than 5 years have passed since your present Will was signed.
Changes of heart/mind. You may simply wish to distribute your assets in ways that differ from your intentions when your existing Will was signed.

This list is by no means complete, and there may be other factors that could trigger the need to revisit your estate plan. If any such life event arises, or if you are just in doubt, it may be a good idea to review your Will with a qualified estate planning attorney.

Do I Need A New Will If I Move To Another State?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Tue, 20 Jun 2023 00:42:00 +0000

A Will that is properly executed in one state is generally valid in another state. This is based on the Full Faith and Credit clause of the U.S. Constitution.

That said, there are state-specific rules for the drafting and execution of Wills, and the probate process, that can vary from state to state. While all 50 states have adopted the Uniform Probate Code, each state has the discretion to tweak the Code language as it sees fit. These variations may impact certain provisions in your Will, and affect how the probate process may apply to your Will.

Different states may require different elements for a Will to be valid. Many states require that the Will be typed or printed. Other states allow hand-written Wills ("holographic" Wills). There may be variations as to notarizing a Will, and who must witness the signing.

Estate and inheritance taxes may differ from state to state.

Property laws can vary from state to state, and some provisions in a Will executed in one state may not be valid in some other states. In the majority of states, common law applies, wherein a spouse that acquires property solely and completely owns that property. However, nine states apply community property law. In this case, all property acquired by either spouse is owned jointly by both spouses. If you have a Will executed in a common law state and you move to a community property state (or vice versa), there are issues that may arise after you die.

Moving is exciting, but it can be stressful and filled with lots of tasks. When relocating to a new state, don't take chances with your estate plan. Seek a qualified estate planning attorney in your new state and have them review your existing Will. In addition, it would also be prudent for you to have the new attorney look over your Health Care Directive and Power of Attorney.

A Checklist For Personal Representatives, Revisited.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Tue, 23 Aug 2022 19:59:00 +0000

(I posted an article on this topic a few years ago. That article is still good information, but I wanted to revisit the topic and expand on it some. This list is not exhaustive, and each case is unique, but it should cover some major points.)

* * *

You've been nominated as Personal Representative (formerly called "executor") for someone's estate, and now that individual has recently passed away. There is so much to do, where do you start? The job may seem daunting, especially when dealing with loss. You have your own life, your family, your career. Acting as PR can take a lot of time and commitment. But it doesn't have to be insurmountable. Let's break it down.

I. The Personal Representative has three major duties.

Collect assets and ensure that those assets are protected,
Pay valid debts of the estate, and
Distribute any remaining assets (specific gifts and residue) to the beneficiaries.

II. You represent the interests of the estate.

The PR is a fiduciary (agent) of the estate, and not an agent of the beneficiaries. The estate is a legal entity with legal rights, just like a person or a corporation. Even though the beneficiaries may ultimately inherit assets from it, until the probate is closed and everything is wrapped up, the estate remains a separate and distinct legal entity from those beneficiaries. That means your duty of responsibility is solely to the estate. If the needs and wants of any of the beneficiaries (or anyone else) ever becomes at odds with the interests of the estate or your duties, always understand that the estate is your "client" and you must act on its behalf.

As the estate's fiduciary, you have standing to sue any party on behalf of the estate--that includes beneficiaries! Hopefully, it won't come to that.

Note that at this stage, you are merely the Personal Representative nominee, having been nominated in the Will. You do not officially become the PR until the probate court appoints you as such. This is done by the court issuing what is called Letters Testamentary. Due to privacy concerns, many entities, such as financial institutions, may not be able to do anything until you have provided them a copy of the Letters Testamentary proving to them that you have been appointed by the court.

III. Seek the advice of a competent attorney.

There are some exceptions, but many estates need to be probated. This can be a daunting process, and it would be prudent to seek the guidance of a probate law attorney. Even if probate is not needed, it's wise to check with an attorney as soon as possible. Legal fees for this can be billed to the estate, and it's money well spent.

IV. Collecting and protecting assets of the estate.

One of the first tasks is to gather documents left by the decedent. You should have the original, signed Will in your possession. If the estate must go to probate, the court will need you to submit the original document. If you find more than one Will, keep them together, as the court will need to determine which one governs. Also look for any lists of personal items to distribute.

You are not obligated to disclose the contents of the Will with any beneficiaries or other persons at this time. Doing so could lead to conflicts, especially if you are also a named beneficiary, and you don't need conflict now. Keep that information close to the vest and let family members deal with their grief. There will come a time for you to "read the Will" to the family a little later on.

Collect all financial, medical, and other relevant documents, and do this as soon as possible. If those have been kept in a locked file cabinet or safe, have someone provide access to it. Along with the Will, keep these documents in a secure location where others cannot access them. After someone dies, it's not unusual for people to come and go in the house to pay respects or deliver things. Don't let important items get lost in the shuffle. It is preferable to remove those documents from the premises as soon as possible and keep them in a secure location of your own.

Locate and secure valuables, such as jewelry, cash, firearms, antiques, coin collections, etc. This includes any electronic devices that might hold data, such as computers, smartphones, tablets, etc. Limit access to the home. If that means changing the locks and keeping out family members, so be it. Don't take the risk of someone independently helping themselves to things. You are responsible for the security of estate property. Make it clear to everyone that there are legal remedies available to you if someone absconds with estate assets.

There may be online information you will need to obtain. Under RUFADAA, as PR, you have right to access certain digital assets of the decedent--if the decedent gave authorization in the Will. You can also check with family members to obtain logins to accounts.

Are there outstanding debts owed the decedent, like IOUs or promissory notes? Did the decedent loan money or property to someone? Unless there is some written agreement discharging debts on death, those debts are now owed to the estate. Locate the documentation for these, and contact the debtors to collect.

If the decedent owned a business, you will need to determine what succession plan must be followed. Are there co-owners? How will control of this business be passed on? This may require the help of a business law attorney.

When you contact companies, you may discover some assets you previously weren't aware of. Be sure to ask if there are balances due, or refunds. If there is a refund due, such as an unused portion of an insurance premium or a credit, be sure to obtain that. You have a duty to maximize the estate assets.

Some instruments in the estate are non-probate assets, such as pension funds, investments, life insurance policies, and assets with a payable-on-death provision. These are paid directly to the named beneficiaries and are not subject to probate. You still may need to contact those firms to give notice of the principal's death and help coordinate the payout process. The fact those are non-probate assets does not automatically protect them from debts for medical assistance. Many assets are reachable in MA claims. The same is true with debts to the IRS and state/local taxing authorities.

If there are salable items in the household that can be converted to cash, it may be worthwhile to hold an estate sale or a garage sale. Certain valuables, such as jewelry, firearms, artwork, motor vehicles, etc., may need appraisal. All funds recovered from this (minus any auction or consignment fees) are estate assets and must be deposited into the estate account.

V. Gathering information concerning potential estate debts.

Few people die with zero debt. You will no doubt be sifting through what seems like mountains of financial documents. Many of those will be bills. You may not know which--if any--have been paid. Develop a plan and start organizing bills and statements for the different creditors. Don't assume something is settled--contact each creditor to give them notice of death and to see if there is an outstanding balance.

You will need to publish a notice to creditors in the legal section of the local newspaper, once a week for two successive weeks. Creditors have 4 months from the date of the first publication to make claims against the estate.

You will be making phone calls. Lots of phone calls. The list of places to call may include Social Security, Medicare/Medicaid, state social services, VA, mortgage lender, landlord, IRS and Minnesota Department of Revenue, medical providers, funeral home, insurance companies, banks, investment agents, utilities, phone and internet, credit card companies, HOAs, clubs, subscriptions, etc. Your calls to them will put them on notice of the testator's death, and help you make a tally of what debt obligations may exist.

Once the court has officially appointed you as PR, you should set up a checking account in the name of the estate. Prior to doing that, you should file IRS Form SS-4 to obtain a new tax ID (EIN) for the estate. The bank will need that EIN, along with your Letters Testamentary and copy of the death certificate. You will need to fund the account with the estate's cash assets in order to pay debts. The estate EIN will be needed for tax preparation later.

VI. Paying valid debts.

Once you have determined the estate assets, and have a list of creditors to pay, you may begin paying debts from the estate account. Minnesota law states a list of priority for the paying of estate debts. This Classification of Claims can serve as a guideline for you to determine who gets paid first. If the sum of the estate assets is less than the sum of the valid debts (insolvent estate), you pay the high priority debts first and work your way down until estate assets are exhausted. The remaining creditors may then be out of luck. The beneficiaries will be out of luck, too, as valid debts take priority over their inheritances.

As PR you are not personally liable for estate debts, as long as you act in good faith.

You may have to file personal income tax returns for the decedent next tax season, and it would be wise to keep some money in the estate account for preparation fees and any tax liabilities. If the estate is large, there may be estate taxes due.

Be aware that some debts may incur late fees and penalties over time. Paying these on a timely basis can limit those extra expenses. Again, your job is to maximize estate assets.

VII. Your expenses.

You are entitled to reimbursement from the estate for out-of-pocket expenses incurred during your representation. In addition, you may be eligible for reasonable compensation for your time spent performing your duties. You also may need to hire the services of professionals: appraisers, tax advisors, attorneys, etc. The expenses of those services may be billable against the estate.

VIII. Distributing the remainder to beneficiaries.

After all valid debts are paid, you have submitted an accounting to the probate court, and the court is satisfied that all elements of probate have been completed, it will officially close the probate. This may not happen until a year or more after the testator has died. Your next task is to distribute any remaining assets to the named beneficiaries, per the instructions in the Will. There are two classifications for these: specific gifts and the residue.

Any specific gifts that are provided for in the Will are distributed first and they take priority over the residual shares. Thus, if there is a provision for property or a cash amount to be paid to a named beneficiary, that must be conveyed directly to that beneficiary.

After specific gifts (if any) are distributed, the remainder (residue) is distributed to the named beneficiaries, based on the proportions stated in the Will.

Note that it is generally OK for the PR to allow family members to take some keepsakes or family heirlooms prior to distribution of the rest of the estate. Use good judgment in granting this. A valuable coin collection or the car out in the garage is not likely a "keepsake" for the taking. Any major item that can be converted to cash should be held to sell for estate funds. Remember, the probate court will expect an accounting of big-ticket assets. However, some household items, family photos, etc., are generally OK to distribute right away. If there is a separate list of personal items referenced in the Will, these items can generally be distributed before probate is closed.

Do not give advances in estate funds to beneficiaries prior to closing of probate, unless there is some trust provision that requires it. What if a creditor or bill pops up later and you need that money to pay it? If you distribute money to someone and there's not enough remaining funds to pay a valid debt, you will need to claw back money from those beneficiaries. Remember, you have standing to sue on behalf of the estate. Keeping a tight rein on estate funds will help prevent such an awkward encounter.

IX. Other "non-PR" tasks you may need to do anyway.

There are some "loose ends" tasks that need to be done after someone dies. Some of those tasks may fall on your shoulders if no one else steps up to do them.

Disposal of unwanted household goods, items that may not bring in cash to the estate. You may need to haul some stuff to a donation center, other items may need to be tossed or recycled. If there is a large quantity of items to dispose of, you may need to rent a rollaway dumpster.
Cleaning/prepping the house. Someone will need to prepare the house for sale; or if it's rental property, get the premises clean and obtain the deposit refund from the landlord (another estate asset).
Some items may need to be stored, perhaps in a storage locker. Encourage those recipients to remove those items before a storage rental is necessary, or insist that they pay to have them stored.
Are there pets left behind? You may need to care for those, and/or find new homes for them. Check to see if the Will has a provision for caring for pets.
You will likely receive plenty of the decedent's mail that, by now, you have had forwarded by USPS. You will need to sort through that and respond to the items that need attention.
Sending thank you cards to people who gave gifts or memorials at the funeral.
If the decedent's remains were buried, check to see if a headstone is being made and that payment is made from the estate for that.

It might be prudent for you to delegate some of these tasks if you become overwhelmed with work with the estate.

X. If the estate is a hot mess.

Some estates are left with an enormous amount of loose ends and touchy issues to be addressed. There may be a huge load of debt. There may be conflict flaring up among family members, some which may be directed at you. There may even be someone who contests the Will or threatens to do so. Keep a level head and persevere. You are the estate's agent and the testator trusted you to carry out this job. Seek the help of an attorney, especially if someone threatens to contest the Will.

If the Will has named another person to step in as a co-fiduciary, ask them for help. You can delegate some of the legwork that needs to be done.

* * *

Being a Personal Representative is often a tedious, thankless job, but one that can be rewarding in the end. You can do this!

Why Have A Will?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Thu, 18 Aug 2022 02:30:00 +0000

I often field the question: "Do I (we) need a Will?" More often than not--actually, MUCH more often than not--the answer is YES.

Let's look at some reasons why a valid Will should be in your estate planning portfolio.

First of all, not having a valid Will means a probate court must decide how your assets are divided up and distributed to your descendants. This is called intestacy. Intestacy is merely a fail-safe created by the Legislature, an attempt at a one-size-fits-all solution, but it is far from perfect.

Having a valid Will helps ensure that your assets go to the persons you want them to, in the amounts you choose. Without a valid Will, Minnesota intestacy law requires the probate court to distribute your assets based on a certain hierarchy, a particular order of who is in line to inherit your estate assets. Without a valid Will giving instructions, the court has to rely on this state-mandated default to determine how your estate is to be divided. That hierarchy may or may not be what you wish to happen.

A valid Will allows you to tailor the proportions of your estate assets you wish to give to family members. Maybe you don't want to divide up assets evenly. Perhaps there is a child who is closer to you or needs more financial help and deserves more. Conversely, there may be a family member who, due to dependency issues or poor money management skills, or who is estranged, is deemed one who should receive less--or none at all. Without a valid Will, the probate court will likely distribute your assets evenly between your descendants, without your input to the contrary.

A valid Will enables you to give certain items of property or money--specific gifts--to individuals or charities. The laws of intestacy make no provision for specific gifts to be given to people outside of the shares given to the legally-mandated heirs. Want to donate some money to a friend or relative, or a charity? Sorry, the laws of intestacy do not accommodate those kinds of wishes. You need a valid Will to make those choices.

A valid Will allows you the freedom to nominate persons to act as your fiduciary--the Personal Representative (executor) of your estate. The job of the estate PR is absolutely crucial and I cannot emphasize enough the importance of this selection. You may have certain individuals in mind whom you can trust to manage your estate after you are gone. Without a valid Will, the probate court decides who will act as the fiduciary. The person they choose may not be the person you want acting in that important role. The PR collects estate assets, pays valid debts, and distributes the remainder to the beneficiaries. If you see no other reason to obtain a valid Will, this is the one that should tip the scales in favor of it.

If you have children who are under the age of 21, a valid Will allows you to nominate a custodian to manage the minor's inheritance until that minor attains the age of 21. Without a valid Will, the probate court chooses that custodian.

If you own real property, your estate must pass through probate, unless you have executed a Transfer On Death Deed (TODD). With a valid Will your chosen Personal Representative will be someone you can trust to work with the probate court, and handle any real estate transactions.

Note that I have used the term "valid Will" throughout this article. I want to point out that just having some "will" may not, in itself, be sufficient. You need a carefully constructed Will, a legal document that reflects your values and wishes. This should be a document crafted by a competent Minnesota estate planning attorney, ensuring that it complies with Minnesota law. Sure, you could go DIY, download some template from the internet and fill in the blanks. But without the careful guidance of a competent attorney who understands your wishes and the legal landscape, your money-saving DIY document may not hold up to legal scrutiny after you die. Is it worth the risk, just to save a little money?

Preserving your hard-earned assets for the security of your family members is too important to leave to chance. Contact a licensed Minnesota attorney to begin protecting your estate.

Can My Estate Planning Attorney Divulge My Information After I'm Gone?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Wed, 27 Oct 2021 00:56:00 +0000

The rules regarding attorney client privilege and confidentiality are sacrosanct. These rules protect most communications between clients and their attorneys. This is necessary to ensure that clients receive competent legal representation by encouraging full disclosure by the client without the fear that the information will be revealed to other parties. This protection includes preventing the attorney from being compelled to testify against their client.

The general rule is that the attorney client privilege does not cease upon the client's death. There is no general posthumous exception. In fact, the U.S. Supreme Court upheld this more than 20 years ago in quashing an attempt to subpoena attorney-client conversations between Deputy White House Counsel Vince Foster and his attorney that took place days before Foster's death.

Nevertheless, there are a few specific exceptions. In Minnesota, one such exception is the testamentary exception to privilege and confidentiality. This exception has been recognized under Minnesota law since the 1920s. However, the courts make distinctions between situations involving disputes initiated by heirs or next of kin, versus those involving third parties (e.g., creditors) seeking privileged information to establish claims against the estate. In the latter situations, Minnesota law does not allow the application of the testamentary exception to those third parties.

What this means is that the court can require that an attorney hand over privileged information in cases where a claimant, such as a beneficiary, heir, or omitted next of kin, has an interest in the deceased client's estate. In most cases, the attorney subject to the court's disclosure request will have no choice but to comply with the request. But the court will not allow a third party, such as a creditor, to access to the decedent's privileged information.

When communicating with your attorney to discuss your estate plan, it is important to know that your information has protections that apply while you are alive. During your lifetime, your heirs, beneficiaries, and other persons cannot demand to obtain your privileged and confidential communications between you and your attorney.

However, after you pass, it may be possible for certain persons to request such information, perhaps in a Will contest. Or a descendant may have questions about your testamentary intentions, questions that cannot be answered after you are gone.

While no Will is infallible, a well-crafted document can lessen the risk of it being contested. Talking to a qualified Minnesota attorney is the first step in protecting your estate assets.

Your Kids Don't Want Your Stuff.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Fri, 02 Jul 2021 20:52:00 +0000

They simply may not want all of those personal items you've accumulated over the years: household goods, furniture, clothes, decorations, collectibles, and all that stuff piled up in boxes in your garage or attic. Do your children really want to be sifting through that after you're gone?

(They do want your cash, and whether or not you may wish to give them a large amount of it was the topic I discussed in a recent article.)

Perhaps you're retired, or thinking about retirement. Now might be a good time to downsize. Clean out the closets and basements. Get rid of some clutter, things you haven't used in a while and probably won't use anytime soon. Have a yard sale or post it on Craigslist and make a few bucks. Donate items to charity, recycle, or just toss them out. Rent a roll-away dumpster if you have a lot of unsalable items to clear out.

The Swedes have made this practically an art form, and of course, there's a book on the subject.

Every generation has its style conventions, and your kids' generation has its own, too. They may not have the same appreciation for the things you enjoy, and if they inherited them, might not have space for them. Younger people are less apt to purchase real estate than members of previous generations. (Who can afford to buy a house now, anyway?) Many more people are renting, and they may not need or want a lot of your items after you are gone.

This is not to say everything needs to be given the heave-ho. There may be certain items your kids will appreciate receiving. Earmark some keepsakes: perhaps family heirlooms, mementos from your military service, a hand-made piece of furniture, artwork, or a family photo album. Talk to your children about what's important to them. Discuss with each of them what they might like to receive when you're gone, the family items they would treasure and perhaps pass on to their children some day.

You can give specific personal items to family members by means of a written list incorporated into your Will.

Talking to a qualified attorney is the first step to creating an estate plan that reflects your wishes.

Why Choosing The Right Fiduciary Is So Critical.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Thu, 10 Jun 2021 22:23:00 +0000

When you execute a Power of Attorney and designate a fiduciary (Attorney-in-Fact), you are granting an enormous amount of power to that person. Perhaps you have already executed a POA and have named one or more family members to act in your interests financially. They are your family, maybe your children. You should be able to trust them, right?

A cautionary tale.

Will the kids take on the task of protecting your financial well-being and do the right thing? Over time, the dynamics in your family may change. People change. Are the persons you have entrusted to represent what's best for you still the best people for the job?

It might be wise to revisit those legal documents from time to time and ask yourself a tough question--are your fiduciaries are still up to the task? Talking to a qualified estate planning attorney is a good first step to ensuring that your legal instruments still reflect your needs and best interests.

"We're Spending Our Children's Inheritance!"

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Sat, 05 Jun 2021 19:47:00 +0000

You usually spot that message on bumper stickers attached to big RVs. It's kind of a glib slogan, but when you think about it, maybe it's not such a bad idea. (You're probably thinking this sounds harsh, but hear me out...)

You've spent your adult life working hard and building up a nice nest egg. Now comes the time to reap the benefits--enjoy what you've been working for all those years. Buy a vacation home, travel, take up a new hobby. Live your retirement years to the fullest and perhaps leave just a modest sum for the kids. It's your money. Sure, the kids might love to inherit a big pot of money, but is that really the best thing for them? Would leaving a large inheritance help them, or would it create problems for them?

There are some points to consider on whether to leave a big inheritance.

If an adult child has addiction or money problems, giving them a large inheritance may only magnify the problem.
Money may (and often does) create conflict among family members. Grief amplifies that.
It's human nature for people to be less careful with money they didn't have to earn. Statistically, roughly half of them will just blow it anyway.
Leaving a modest inheritance encourages children to not rely on it to solve all their money woes.
Perhaps your children are already finding their way financially and they don't need it.
The kids might be burdened with tax liabilities if the estate is large.

A couple possible alternatives:

Show your generosity by giving family heirlooms instead--something they would treasure and hand down through the generations. Those are the things your kids will remember you by.
Another option: Give them some of their inheritance early--there is a $15,000 per person per year gift tax exemption. Perhaps put it into an investment, like a college fund or earmark for a home down payment.

The take-away point I'm making is this: There's more than one good way to leave an inheritance to children. You may wish to leave it all to the kids, and that's fine. On the other hand, maybe you don't want to leave so much, and that's OK, too. It's your money, and you should do what you feel best with it.

Whatever you wish to do, it would be prudent to talk to a financial planner and/or tax advisor on how to best manage your assets now. It would also be prudent to talk with a qualified attorney to discuss options for your estate plan.

The Safekeeping Of Your Estate Planning Documents.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Fri, 14 May 2021 00:32:00 +0000

You have just executed (signed) your Will, and perhaps also a financial Power of Attorney and Health Care Directive. What now?

While many law firms will store original, signed documents on behalf of clients, many do not. (I do not.) You may be tasked with the custody and safe storage of your valuable estate planning instruments. Too many people stash their valuable documents in a shoe box or among a stack of papers on a desk, which is a very bad idea.

In the case of Wills, your personal representative will need to obtain the original, signed instrument to submit to the probate court after you die. Therefore, it is essential that your Will be kept in a safe, secure location, but one where the personal representative has access when needed.

A home safe, secure file cabinet or fire-resistant lock box is a good location for a Will. This minimizes the chance that the Will is lost or destroyed by fire or flood, and it keeps it away from prying eyes. Another option is to store the Will in a safe deposit box at a bank. However, it is important that the personal representative has access to the box.

Perhaps the best and most secure option is to deposit the Will for safekeeping at your county probate court, usually for a small fee. That way, the Will is kept where it needs to be when the time comes.

It's a little different for a Power of Attorney and Health Care Directive. These are documents that are needed while you are alive but usually at a time when the you are incapacitated or otherwise unable to make decisions for yourself. The documents may be needed quickly when the time comes, and as such, they should be stored in a place where they can be immediately retrieved. The named fiduciaries should have knowledge of their location in advance and have access to them. For these instruments, a bank safe deposit box may not be an ideal location, as the institution may be closed when the documents are needed. A file cabinet or home safe is a good location.

Most health care providers will scan and store a patient's Health Care Directive, so it is important to give copies to your doctor, clinic, local hospital, care facility, etc.

The Trifecta: Basic Will, Power Of Attorney, Health Care Directive.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Mon, 03 May 2021 00:32:00 +0000

You should have all three in your estate plan.

The Basic Will.

This powerful and important legal document is an instrument that can help ensure that your assets will pass to your loved ones, according to your wishes. A valid Will also allows you to choose your personal representative, a person who has a fiduciary responsibility to represent the best interests of your estate. Your personal representative is responsible for probating your Will--that is, to file an application or petition the probate court and admit your Will to the court. Your Will can also name guardians and conservators to care for the personal and financial needs of minors.

Dying without a valid Will (intestacy) can result in the probate court deciding where your assets go, which may not be what you wished for. In addition, the probate court gets to determine who will act as your personal representative, and will appoint any necessary guardians or conservators.

The Power of Attorney.

This instrument gives one or more persons the power to act on your behalf as your agent for property and financial matters--while you are still alive. When you grant power of attorney you are referred to as the principal. The agent is referred to as the attorney-in-fact. A Power of Attorney can be narrowly limited to a certain activity, such as dealing with real estate transactions, or it may be very broad in scope, giving the attorney-in-fact the power to manage many affairs for the principal. The Power of Attorney can be designed to give temporary or permanent authority to act on your behalf.

A Power of Attorney can be designed to be in effect only while the you are able to make decisions (non-durable), or it can remain in effect if/when you become incapacitated or incompetent (durable). You can revoke your Power of Attorney at any time and for any reason. However, you must give written notice to your attorney(s)-in-fact that their powers have been revoked.

The Health Care Directive.

Sometimes referred to as an "advance directive," a Health Care Directive is an important legal instrument that has two components: 1) it provides instructions concerning your health care in the event you are unable to make those decisions yourself, and 2) it names one or more persons to act as "fiduciaries" or agents to access your medical records and make health care decisions on your behalf--what is known as a Durable Power of Attorney for Health Care (DPAHC).

A Health Care Directive provides guidance to your physician, family and friends in the event you are unable to communicate due to physical or mental incapacity. A Health Care Directive sets forth your health care goals and concerns and helps to ensure that your wishes are adhered to, even if those wishes are contrary to the interests and beliefs of others. You can state what you want as well as what you don't want. You can also state limits of the powers you want to give to your agent.

Your Health Care Directive becomes effective when it meets certain legal requirements and your health care provider determines that you are no longer able to make health care decisions for yourself. Your health care provider generally will follow your Health Care Directive, or any instructions from your agent, as long as the health care follows reasonable medical practice. However, you or your agent cannot request treatment that will not help you or which the provider cannot provide.

* * *

Contacting a qualified Minnesota attorney is the first step in building a comprehensive estate plan that meets your needs and provides for the future of your loved ones.

Equality vs. Equity: Considerations For Leaving Estate Assets To Your Children.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Mon, 26 Apr 2021 01:29:00 +0000

Any good parent strives to love and care for all their children (and grandchildren) equally, while trying their best to avoid favoritism.

When strategizing your estate plan it seems intuitive to do the same, to take the straightforward route and give an equal share to each child. After all, you may be thinking you don't want to play favorites, right? And in many family situations, equal division of inheritance is the best approach.

But there is a difference between "equal" and "equitable." There are instances where, in the name of equity, it might be worth considering giving unequal shares.

Here are a few situations where giving unequal shares may be the most equitable thing to do:

Having a child with special medical needs who would rely on the extra financial support.
Providing more funds for children who are planning to go to college, vs. those who aren't.
Rewarding a family member who was more attentive during your lifetime, perhaps a loyal caretaker who deserves extra as a gesture of appreciation.
Limiting the share for a child with gambling or substance abuse issues or a history of poor money-management.
Disinheriting a child who is estranged from you.
Giving a smaller share to an adult child who has been more successful on their own and doesn't need (or want) a large inheritance, and thereby giving more to others who do need it.
Reducing the share for a family member who owes you money, such as through a loan or business venture.

Give it some thought: Perhaps it's equitable to give more money to a loved one who needs and deserves it more and would appreciate it. Perhaps it's equitable to give less to someone who has not been as much a part of your life, or who has money issues.

The key point to remember when dividing your estate is that it's your money and you get to do with it as you see fit. Just keep in mind that taking the equitable-but-unequal approach to your estate plan carries some risks. There may be children who won't be happy to discover that they received less than (or none of) what they feel was their rightful share of your estate. They may be jealous that someone else received more. An equity over equality plan can give rise to family drama, and possibly a legal challenge (contest) of your Will.

You are in the best position to know your family's values and their dynamics. Deciding whether to divide your estate equally among your children, or to tip the scales in favor of some children over others, is not an easy task. Talking candidly with your children about your estate plan now may help smooth out the road ahead. But how you choose to give is your decision to make, and there are no wrong answers.

Collecting Debts Owed To An Estate.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Mon, 19 Apr 2021 20:26:00 +0000

Last week I discussed debts owed by a decedent (and accordingly, debts owed by the decedent's estate). One of the first items of business in administering an estate is paying valid debts.

But what becomes of debts by others, owed to the estate? How are those debts collected? Who is responsible for collecting them?

In the case of receivable debts to the estate, which is the subject of this post, the decedent was the original creditor, and upon the decedent's death, the debtor is not necessarily relieved of their debt.

An estate is a legal entity, just like a business is a legal entity. And just as accounts receivable by a business are considered assets, so too are debts owed to an estate.

In probating an estate, the personal representative is responsible for gathering and taking inventory of all the estate assets, as well as maximizing and protecting those assets. Therefore, the personal representative has a duty to collect any debts owed to the estate. Since the personal representative also has a duty to pay debts owed by the estate, collecting on receivable debts is important, as it maximizes the value of the estate. Valid debts are paid by the estate assets, and any remaining assets are to be distributed to the beneficiaries according to the terms of the Will, or according to the laws of intestate succession, if there is no Will.

Collecting the debts.

The first question: Is there an existing contract for the debt? If so, the estate can usually enforce the contract, just as the decedent could have enforced it while alive. In this sense, the personal representative "steps into the shoes" of the decedent. If the debtor to the estate refuses or fails to pay the debt, the debtor can be subject to legal consequences. The personal representative can sue the debtor to collect.

In instances where the creditor is unable to pay the entire debt, and the family wants to avoid a prolonged battle, it may be wise for the personal representative to negotiate a settlement, to at least salvage some of the debt. The personal representative should make efforts to glean as much as reasonably possible from debtors.

If there is no contract, it gets murkier. The personal representative can try to collect, but it may be a case of "he said-she said," and one of those parties is gone. It doesn't hurt for the personal representative to at least try to collect such debts, but the PR may come out empty-handed.

(Pro tip: If you, the testator, are going to loan money to someone with the expectation of repayment, memorialize the loan in writing, even if the debtor is a family member.)

In some cases, such as with an insolvent estate (debts owed by the estate exceed its assets), it may be impractical for the personal representative to pursue all receivable debts, as collecting may not change the estate's insolvency status. The beneficiaries may not wish to pursue such a futile battle, preferring instead to wrap up the probate process and moving on with their lives.

The important point regarding the personal representative is that the PR has a duty to make reasonable efforts to maximize the value of the estate.

(Another pro tip: When having your Will crafted by an attorney, make sure that the attorney includes an "indemnification" clause that protects the personal representative. This will help prevent the personal representative from suffering personal liability while acting in good-faith in carrying out their duties to your estate.)

One of the important tasks of settling an estate is gathering all of its assets. Will your nominated personal representative have the tenacity to collect debts owed to your estate? This is another thing to consider when choosing someone to act as your personal representative.

Debts Owed By An Estate: Who Gets Paid First?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Tue, 13 Apr 2021 14:26:00 +0000

One of the first items of business in administering a decedent's estate is the paying of valid debts. In the probate process, the appointed personal representative must locate creditors of the estate and give notice to them. The creditors have a certain amount of time in which to make a claim against the estate.

Minnesota law sets forth a priority for how debts are paid by the estate, called Classification of Claims. While some creditors may be more assertive than others, the squeaky wheel does not get the oil. This is the pecking order for the payment of estate debts:

Expenses related to administering the estate, including attorney fees.
Reasonable funeral expenses.
Any debt having preference under federal law, including federal taxes.
Medical expenses related to the decedent's final illness.
Medical expenses incurred during the year prior to the decedent's death.
Any debts under state law, including Minnesota taxes.
Any unsecured debt, such as credit cards, utility bills, etc.

If the total value of debts exceeds the estate assets, the estate is deemed insolvent. In such a case, some of the debts farther down the list may not be paid at all. And unfortunately for the heirs of the estate, they will not receive a share of estate assets.

A Basic Checklist For Avoiding Probate.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Wed, 07 Apr 2021 23:54:00 +0000

Many of the inquiries to my firm include questions about avoiding probate. While the probate process can be drawn out and sometimes expensive, it has a few advantages, such as requiring a fair appraisal of the estate value and giving some protection from creditors. As with any legal process, there are pros and cons. Nevertheless, many people wish to avoid probate in a desire to streamline their estate planning.

Generally, an estate is subject to probate, in the form of what is called the probate estate. The probate estate includes property not held in joint tenancy or that which has designated beneficiaries, such as life insurance policies. Probate is required unless certain assets, such as real property, are removed from the probate estate. For those who wish to avoid probate to the extent possible, there are a few ways to help do so. One way is to move certain assets into a trust.

Another way is reducing the value of the probate estate to below $75,000, for it to qualify as a "small estate," not subject to probate. That means eliminating some high-value assets from the probate estate:

TOD/POD designations for as many financial instruments as possible. Bank accounts, investment funds, etc.
Transfer on Death Deeds (TODD) for the home and vacation properties. This takes the properties out of the probate estate by transferring it to named beneficiaries.
Transfer on Death (TOD) registration of motor vehicles and watercraft.
Gifting money while you are still alive. The IRS allows you to give up to $15,000 per person per year without triggering the federal gift tax. (Married couples can give double that amount.)
Giving property to charities while you are still alive.

Even with a probate avoidance strategy, the above measures do not eliminate the need for a well-crafted Will. Distributing your remaining personal assets and nominating fiduciaries should not be left unplanned. If minor children are in your estate plan, you will want to nominate individuals to act in their legal interests. Without a valid Will, your assets will be distributed according to the laws of intestate succession, which may not reflect your wishes. Not having a Will could also give rise to family disputes after you have died.

Consulting a qualified Minnesota estate planning attorney is the first step in protecting your hard-earned assets for the future of your loved ones.

Probate: Pros And Cons.

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Thu, 01 Apr 2021 23:32:00 +0000

A common topic in the estate planning world is the concept of "avoiding probate." While doing so is a good idea in many cases, probate isn't necessarily a bad thing. When considering your estate plan, it's important to look over the pros and cons of the probate process.

Advantages of probate:

Oversight by the court. Probate is governed by a set of enforceable rules based on established law, to help make sure your assets go where they should. This is an important consideration if there may be conflict among your beneficiaries.
Determining debts owed by the estate. Probate requires the personal representative to identify and give notice to legitimate creditors, thus providing more certainty of the estate's financial liabilities.
Transparency. The probate court requires that written notice be given to your beneficiaries to keep them apprised of what's happening in the estate administration.
Fair appraisal of assets. The court can approve the appointment of independent appraisers so that property is correctly valued.
Protection from dubious creditor claims. The court will enforce limits under Minnesota law as to how much time a creditor has to pursue a claim against your estate. The laws relating to creditor claims can be complicated and are fact-dependent. Having the court set the rules can be helpful.
Probate can be informal for some estates. Minnesota allows an informal probate process that does not require court supervision. This may be appropriate for estates without uncertainties, legal disputes, or complex administrative requirements.

Disadvantages of probate:

Probate can be expensive. There are court costs, attorney fees, personal representatives' fees, and other expenses. Still, probate expenses may end up being less than the cost of defending against a Will contest or unfounded creditor claim.
Probate can be time-consuming. Administering an estate in probate may take a year or more, depending on the complexity of the estate and whether there are conflicts among beneficiaries or claims from creditors.
Public knowledge. Probate is a public process, and as such, your Will becomes a matter of public record. Your estate plan is available for anyone to look up. This could give unknown creditors an opportunity to make claims against your estate.

Regardless of whether your estate will be probated or not, having a valid Will is an important tool for your estate plan. Consulting a qualified Minnesota estate planning attorney is the first step in protecting your hard-earned assets for the future of your loved ones.

How Much Does A Will Cost?

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Mon, 29 Mar 2021 18:11:00 +0000

I get that question a lot.

"What are your fees for making a Will?"

It depends.

I realize that's probably not the answer you were hoping for and I'm not trying to be evasive. But with anything that's so very personalized and fact-dependent, as is the case with estate planning legal services, the answer is never cut and dried.

Consider this: If you were to call a building contractor and ask them right off the bat how much they would charge to do a bathroom remodeling job, what do you think would they say? They would tell you they need to visit your home and find out a lot more about the nature of your intended project--what it is you want, what materials and fixtures to be used, how you want the job done and the time frame required. They would need to size things up before producing a quotation.

And so it is with estate planning legal services. Until I have had the time to talk with the prospective client, to learn about their family, their estate assets, find out their needs, their values, and of course their objectives, I couldn't possibly give out a number. I believe it would be a great disservice to apply a one-size-fits-all pricing structure to all potential clients.

Sometimes, the request for quotation is the first question a prospective client asks. It's often a sign that someone is just shopping around for the best deal. I'm not the cheapest practitioner in town (nor do I want to be), but I'm also far from the most expensive. If price is your only criteria, that's your prerogative. You may well find low-cost representation elsewhere. Google is your friend. There are even DIY options, if you feel like tempting fate.

Nevertheless, it is an attorney's responsibility to be transparent when it comes to representation of a potential client and the fees associated with that representation. Here's how the process begins once you reach out to me.

To find out if we are a good match I can offer you a free, initial screening conference, which usually takes 30 to 60 minutes on the phone. Prior to the initial screening conference, I will send out a questionnaire for you to fill out and return. This helps me better understand your situation.

Toward the end of the conference, when I have a good understanding of your situation and your objectives, I will give you a quote of my flat fees for the legal representation you seek, and the terms of payment should you decide to engage my services. You get a clear answer to your cost question before you need to make a decision. There is no obligation, no pressure, and you can walk away if you wish.

I strive to provide solid, competent estate planning legal services that meet the needs of my clients, and to do so at a fair and reasonable cost.

Objectives A Good Estate Planning Attorney Should Aim For...

noreply@blogger.com (Kevin S. Brady, Attorney at Law, PLLC) — Thu, 25 Mar 2021 01:18:00 +0000

...And a prospective client should consider:

Maximize the value of assets for the next generation.
Minimize taxes and expenses.
Avoid probate, if possible (or desired).
Plan for incapacity issues.
Design a plan that helps limit family conflict.
Give the client peace of mind.

These are a few goals to reflect on when evaluating a practitioner. Discussing your estate planning needs with a qualified attorney and asking good questions can help you make the best choices for your loved ones' future.