Posted November 3, 2015 in Estate Planning by Jennifer Mispagel.
In today’s increasingly technological world, leaving your digital accounts out of your estate plan can prove to be a big mistake. As of 2014, 84 percent of American adults own a personal computer and 64 percent own a smartphone. As of June 2015, there were approximately 1.49 billion Facebook users, 300 million Instagram users, hundreds of thousands of videos uploaded on YouTube each day, and over 6 billion photos on Flickr. Given the user increase, more and more people are challenged with administering a loved one’s digital assets.
Digital assets can include files stored on digital devices, email accounts, digital music, digital photographs, digital videos, social network accounts, file sharing accounts, online stores, and software licenses. The entirety of these digital assets forms an individual’s digital estate. Due to the role technology has in today’s world, the deposition of digital assets has become a major issue in estate planning.
One of the biggest concerns necessitating digital estate planning is the emotional value of social network accounts. For example, in 2005 a dispute arose in which a mother, Karen Williams, turned to her twenty-two year old son’s Facebook account after his sudden death in hopes of learning more about him. Ms. Williams found her son’s password and emailed the Facebook administrators, asking them to maintain her son’s account so she could look through his posts. However, within two hours, her son’s password was changed, essentially locking her out of the account. It was not until she filed a lawsuit that Facebook granted her ten months of access to her son’s account and after this period, his profile was removed.
With careful digital estate planning, situations like Ms. Williams’ are less likely to occur. Digital estate planning can also serve a variety of purposes aside from the emotional value. It can make things easier on executors and family members, it can prevent identity theft, it can prevent financial losses to the estate, and it can prevent unwanted secrets from being discovered. However, the current state of the law is uncertain and changing in regards to digital estate planning. Currently, federal law addresses privacy concerns and regulates the unauthorized access of digital assets under the Stored Communications Act and the Computer Fraud and Abuse Act, which can create limitations for those attempting to plan for their digital assets. But recently, the Uniform Fiduciary Access to Digital Assets Act (UFADAA) was created and nearly half of U.S. states have introduced legislation this year to enact the Act. The UFADAA is an inclusive law that would remove obstacles that prevent fiduciary access to digital assets and would also give access to a wide range of digital assets. In California, a bill has been introduced known as Assembly Bill 691 or the Privacy Expectation Afterlife and Choices Act (PEAC). PEAC would deny relatives access to electronic information of their loved one, unless the court finds that the person had previously agreed to pass them onto a fiduciary. This bill was unanimously passed by the House of Representatives and as of September 10, 2015, it was sent to the Senate floor with the instruction that it not be voted on until January 2016 in order for further negotiation among parties and amendment.
Our daily lives have changed from sending letters and keeping photo albums to emailing and using social networking accounts. While the state of the law is uncertain, technological use increases each day, emphasizing the importance of digital estate planning to carry out an individual’s wishes.
Estate planning is a highly complex area of law. If you are interested in digital estate planning or have any questions regarding your current estate plan, please contact the experienced estate planning attorneys at Lonich & Patton for further information. The attorneys at Lonich & Patton have decades of experience handling complex estate planning matters, including nonprobate transfers, and we are happy to offer you a free consultation. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may detail general legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
 Michael Rosen-Prinz, The Uncertain Future of Estate Planning for Digital Assets in California, 21 Cal. Trusts and Estates Quarterly 37 (2015).
 Number of Monthly Active Facebook Users Worldwide as of 2nd Quarter 2015, STATISTA, http://www.statista.com/statistics/264810/number-of-monthly-active-facebook-users-worldwide/.
 Evan Carroll, Sample Will and Power of Attorney Language for Digital Assets, THE DIGITAL BEYOND, http://www.thedigitalbeyond.com/sample-language/.
 Karen Williams’ Facebook Saga Raises Question of Whether Users’ Profiles Are Part of ‘Digital Estates’, HUFF POST TECH (Mar. 15, 2012, 5:57 PM), http://www.huffingtonpost.com/2012/03/15/karen-williams-facebook_n_1349128.html.
 Gerry W. Beyer, Web Meets The Will: Estate Planning for Digital Assets, 42 Est. Pln. 28 (2015).
 States Struggle to Adopt Uniform Access to Digital Assets Act, ARMA INTERNATIONAL, http://www.arma.org/r1/news/washington-policy-brief/2015/04/08/states-struggle-to-adopt-uniform-access-to-digital-assets-act.
 Michael Rosen-Prinz, The Uncertain Future of Estate Planning for Digital Assets in California, 21 Cal. Trusts and Estates Quarterly 43 (2015).
Posted October 27, 2015 in Family Law by Michael Lonich.
No one marries with the intent that they will divorce someday. However, there may be a point in a relationship when it is clear that marital dissolution (i.e., a divorce) is inevitable. How the parties proceed after this point can make the difference between an amicable, peaceful conscious uncoupling and a nasty, drawn-out battle.
Even though a trial, complete with a judge and court-room setting is glorified on television, most cases do not make it to trial and are more commonly resolved with a settlement. Contrary to what some believe, a divorce does not have to go to court. Parties looking to divorce may resolve their dispute through informal negotiations by using out-of-court alternative dispute resolution (commonly referred to as ADR). These proceedings between you and your spouse along with your attorneys promote voluntary settlement though they can also include traditional court proceedings.
Several ADR processes that family law attorneys use are mediation and arbitration in lieu of proceeding to trial. These forms of dispute resolution are gaining in popularity and are shifting the role divorce attorneys play from representing their clients in a legal battle to acting as divorce mediators who help their clients achieve their goals. In order to determine which approach might be right for you, it’s helpful to understand the process each one entails.
The goal of mediation is for a neutral third party to help disputants come to a consensus on their own. In mediation, a professional mediator works with the conflicting sides to explore the interests underlying their positions. Parties in mediation find it effective at allowing them to vent their feelings and to fully explore their grievances.
Mediation sometimes requires the parties to sit in a room together, while other times the parties are in separate rooms and the mediator goes back and forth. This is typically referred to as Kissinger style shuttle diplomacy after it was used to describe the efforts of the United States Secretary of State, Henry Kissinger.
Mediation may be particularly helpful when parties have a relationship they want to preserve (e.g., family members, neighbors or business partners have a dispute) or when emotions are getting in the way of finding a resolution. An effective mediator can hear the parties out and help them discuss issues with each other in an effective and nondestructive manner.
Another form of alternative dispute resolution in family law cases is arbitration where a neutral third party serves as a judge who is responsible for resolving the dispute. The arbitrator listens as each side argues their case and presents relevant evidence, and then renders a binding or non-binding decision, depending on the type of arbitration entered into. Arbitration is less formal than a trial, and the rules of evidence are often relaxed.
Although used more often in civil litigation, arbitration is less often used in divorce cases. In marital dissolution cases, an arbitrator’s decision is not necessarily final, and the parties may still be able to resolve key issues before a court at a later date. It is important to keep in mind that most out-of-court alternatives for resolving a divorce will still require some level of court approval.
Perhaps the most recognizable form of dispute resolution, litigation involves two parties facing off before a judge or judge and jury (Currently, Texas and Georgia are the only states that offer spouses the opportunity to litigate their divorce before a jury). During the trial of a divorce case, the attorney’s for each party present evidence on contested issues while the judge (or jury) is responsible for weighing that evidence and making a ruling.
Typical issues that arise in litigation are the determination of the separate property of a party, how to divide community property and liabilities as well as determination of the validity of a pre- or post-nuptial agreement. If children are present the custody arrangement, child and spousal support as well as the time sharing schedule of the children are often areas prone to increased litigation.
It is important to keep in mind that all of the alternative dispute resolution processes are available in settling any ongoing dispute such as property division, child custody or support. However, the effectiveness of these alternatives in contrast to a full trial depend on factors such as how willing the parties are to work on resolving these issues and the general degree of animosity between them.
These choices can make the decision to divorce a complex field. If you are considering filing for divorce, the Certified Family Law Specialists at Lonich & Patton have decades of experience handling complex family law matters. Please contact the Certified Family Law Specialists at Lonich & Patton for further information. Also, please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
Posted October 7, 2015 in Estate Planning by Michael Lonich.
Many Americans, even those with children, die without a will. State intestacy laws may provide a framework for how a decedent’s asset should be divided amongst his or her heirs. However, many know that it might be wise to avoid the probate process because it ties up property for months and it can be very costly. There are other processes in place for transferring remaining assets after death. In California, there are several options to transfer assets without probate administration.
Here are a few of these options for transferring assets at death, while avoiding probate: 1) joint tenancy, 2) community property with right of survivorship, and 3) California Probate Code Section 13100 et seq.
- Joint Tenancy
- Joint tenancy has a right of survivorship.
- Each joint tenant owns an identical percentage of the entire asset.
- Clearing the title to a joint tenancy upon the death of a joint tenant is often a straightforward process.
- Joint tenancy may be severed unilaterally.
- The new joint tenants will have the power to manage the asset along with the original owner, which may not be the intention of the original title owner.
- The transfer may have gift tax consequences.
- Community Property with Right of Survivorship
- Real or personal property may be owned by a married couple as community property, but with the survivorship features of an asset held in joint tenancy.
- Community property with right of survivorship is normally more favorable than joint tenancy ownership since both the decedent’s and the survivor’s half of the asset receive a basis adjustment equivalent to the fair market value of the asset at the death of the first person to die. When the surviving spouse dies later still holding the asset, the basis will receive another adjustment to the fair market value.
- A spouse can establish an account that provides for a nonprobate transfer at the spouse’s death to a non-spouse beneficiary.
- There is no gift tax consequence.
- A spouse may be able to act alone to revoke the right of survivorship.
- Probate Code Section 13100 et seq.
- If the total gross value of the decedent’s real and personal property in California does not exceed the amount of $150,000, the decedent’s personal property may be conveyed by affidavit or declaration pursuant to Probate Code Section 13100 et seq. and no court involvement will be required.
- Probate Code Section 13100 et seq. is only available if no probate proceeding will be commenced for the decedent’s estate or the personal representative of the decedent’s estate consents in writing to the transfer of property through this method.
- May not be used to transfer real property, regardless of the value of real property.
These are only a few of the methods to avoid probate administration of a decedent’s estate. In planning for nonprobate transfers, individuals should be aware of the pros and cons of their options and anticipate which option works best for their needs. Individual should also be aware of issues regarding liquidity and the intended beneficiaries. Even so, many can benefit from the use of the various nonprobate transfers.
Estate planning is a highly complex area of law. If you are interested in nonprobate transfers or have any questions regarding your current estate plan, please contact the experienced estate planning attorneys at Lonich & Patton for further information. The attorneys at Lonich & Patton have decades of experience handling complex estate planning matters, including nonprobate transfers, and we are happy to offer you a free consultation. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may detail general legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
 Cal. Civ. Code
 California Trust and Estates Quarterly (2014)
Posted August 28, 2015 in Family Law by Jillian Green.
With the rising cost of colleges around the nation, many parents have planned ahead for their children’s future and have started college savings accounts for their children shortly after birth. However, there is no question that tensions rise surrounding financial matters during divorce. Nonetheless, when it comes to a child’s college fund there needs to be a process of communication for the sake of the child’s educational and financial future.
In order to make communication easier, a framework should be set up during the divorce settlement process. Usually the hardest, and initial question, to address during the creation of the framework, is who will own the college savings plan (or 529).
As many parents know, a 529 plan is an education savings plan that is operated by a state or educational institution designed to help families set aside funds for future college costs. While many parties believe that a 529 plan is their child’s asset, it is actually an asset of the marriage and needs to be planned accordingly. Thus, parties need to discuss who will own the 529 plan. There are several options for the parties: 1) parents may either decide who will take individual control of the account, 2) freeze the account, or 3) split the account
1. Individual Control
If the parties decide to have one parent take individual control, that parent would be the only person who can make decisions regarding the use of the funds. It is recommended by experts for the control to go to the noncustodial parent. As certified financial planner Joe Orsolini says, “The noncustodial parent should own the 529 because the noncustodial parent’s assets and income are not included on the FAFSA. If the custodial parent owns the 529, then the value of the 529 will be included on the FAFSA, and this is especially important as the FAFSA asset protection allowance drops significantly next year.” This drop potentially means that families will be able to subtract less of their assets held in savings and investments from their net worth, which could decrease the student’s financial aid eligibility. If the non-controlling parent wants some security with the funds, he or she could be set up as an authorized user, which would allow him or her to see what is going on in the account and that parent should also be designated as the successor owner of the account.
2. Freezing the Account
Another option is freezing the funds, which would mean deposits are no longer made into the account and the money that is frozen in the account could only be designated for education purposes. Freezing the account prevents a former spouse from withdrawing money at any time for any reason. It also prevents a parent from using account funds to pay for the education of a child from a new marriage.
3. Split the Account
The last option is to split the 529 plan, which the judge can order and the state has to abide by. By splitting the plan, each half of the plan would be set up as a new account and owned by each individual spouse. However, if one party is worried about an irresponsible ex-spouse, he or she could set forth some clear language in the divorce decree that specifies funding to be used only for the child’s education. The court could also mandate the percentage that each parent will contribute toward the child’s education.
This divorce process is already difficult enough for all parties involved. Children should not be additionally burdened by the lack of a proper framework for their college education. For this reason, parents need to communicate and set up a proper plan for their child’s educational and financial future in order to ensure their child’s success for college.
If you have any questions about planning your child’s college funds during divorce or any other issue, the Certified Family Law Specialists at Lonich & Patton have decades of experience handling complex family law matters. Please contact the Certified Family Law Specialists at Lonich & Patton for further information. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.
Posted August 7, 2015 in Family Law by Michael Lonich.
“Children are the best part of ourselves-the sum of our past and the promise of our future, the guarantee that our lives and values and dreams will flourish long after we are gone,” said then President Bill Clinton when he made an official declaration in 1995 that recognized the month of August as Child Support Awareness Month.
Child Support Awareness Month is a time to highlight the vital role child support plays in the well-being and lives of millions of families in the United States. “Child Support Awareness Month is a time to salute parents who work hard to ensure their children grow up in stables homes and look forward to a bright future,” stated Yolo County Public Information Officer Beth Garbor. “It is also a time to help remind parents who are not always present that they are an important part of their children’s lives.”
Child support has become a widespread problem in the United States. According to the U.S. Census Bureau’s 2009 report: among the 6.9 million custodial single parents who were awarded child support in 2009, only 41.2% received all of the child support that was due- a 46.8% decrease from 2007.
When a non-custodial parent does not pay the child support order, it likely means that his or her children are missing out on income that they count on and will have to sacrifice accordingly. For many children, these monthly payments are all that stands between them and poverty.
“Children who receive support from both parents tend to do better in school and tend to have fewer behavioral problems through their lives,” said Yolo County Department of Child Support Services Director Natalie Dillon. “This support comes in many forms; emotional, mental, and financial.”
If you have any questions about child support or any other issue, the Certified Family Law Specialists at Lonich & Patton have decades of experience handling complex family law matters. Please contact the Certified Family Law Specialists at Lonich & Patton for further information. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.