Exposes the parent’s assets to the child’s creditors.  If the child is sued, the child must disclose the joint account to the court and plaintiff’s attorney.  The burden falls on the child to convince a court that the child contributed nothing and that the account really belongs to the parent.  Similarly, the account would be a reportable asset if the child filed for bankruptcy.

Eliminates the fiduciary duty a child would otherwise have.  A child as joint owner has no fiduciary duty to manage the account in the best interest of the parent.  By naming the child as agent or

1.       What is an Inheritance Protection Trust?An Inheritance Protection Trust is an irrevocable trust established through a deceased person’s estate plan typically for benefit of a surviving child.  Although the term “Inheritance Protection Trust” could generally describe many types of beneficiary trusts, it usually refers to a trust established for a responsible adult beneficiary who is willing and able to manage an inheritance.  This type of trust is usually drafted to continue for the lifetime of the beneficiary (or until all assets have been spent), rather than end at a predetermined time or age of the beneficiary.     The beneficiary

The Arizona homestead exemption amount increased from $250,000 to $400,000 in 2023.  The homestead exemption, which is automatic in Arizona, is intended to protect an Arizona resident’s primary residence (“homestead”) from creditors.  But the new law includes several intricacies that make it more complex than it initially appears.  For example, the new law requires any existing judgment liens (recorded in the same county) to be paid when the homeowner either sells or refinances the residence.  The prior law stated that a homeowner with less equity than the exempt amount could still refinance a home loan without having to first pay

Your health care power of attorney may permit your agent to restrict visitation. In 2021, the Arizona legislature enacted A.R.S. 36-3211, which prescribes an assortment of rules and procedures regarding whether and how a health care agent may restrict visitation of an incapacitated person.  The law now requires a health care agent to “encourage and allow contact” between the principal (the incapacitated person) and other persons who have a significant relationship to the principal.  The health care agent may not restrict reasonable contact between the principal and any other person without prior court approval.But there is an exception, and you

Bouman Law Firm is a registered subscriber to the Arizona Healthcare Directives Registry (“AzHDR”), an online registry for secure storage and sharing of your health care power of attorney and living will declaration.   The registry was established by the Arizona Department of Health Services and is currently administered by Contexture, a nonprofit organization that provides strategic, technical, and administrative support.  Contexture includes the registry as an integrated component of the Arizona Health Information Exchange.  This gives participating Arizona health care facilities instant access to your health care directives when they are needed most.   The registry is free to Arizona

Congress recently passed SECURE Act 2.0.  The updated law includes countless items that affect financial planning and tax planning, however there isn’t much that affects estate planning.  Only 2 items are worth noting here:1.  The age for required minimum distribution increased from age 72 to age 73. 2.  There are no more mandatory lifetime distributions from Roth 401(k) accounts.

The IRS recently issued proposed regulations regarding the treatment of tax-deferred retirement accounts after the SECURE Act of 2019.  Here are 2 highlights relevant to estate planning:

The age of majority will be defined as age 21.  This means that a minor child of the deceased account owner may elect stretch IRA treatment for pay-out of required minimum distributions until age 21 and then use the usual 10-year liquidation rule until age 31. 

The 10-year liquidation rule will require a beneficiary to take required minimum distributions based on the beneficiary’s life expectancy during the 10-year liquidation period if the deceased

The FDIC recently approved a rule to change how it calculates the amount of insurance is available for bank accounts held in trusts.  Effective 4/1/2024, a trust account will be insured up to $250,000 per beneficiary, not to exceed five, regardless whether the trust is revocable or irrevocable or how the trust allocates inheritance among beneficiaries. For example, a joint living trust for a married couple with 2 children might qualify for up to $1,000,000 of FDIC deposit insurance.  But a joint living trust for a married couple with 5 children would only qualify up to $1,250,000. The new rule is intended

A revised 2022 edition of the Arizona Estate Administration Answer Book was recently published by Barnes & Noble Press.Practical Answers to Common Questions for Any Size Estate in ArizonaThe Arizona Estate Administration Answer Book is your best resource for understanding practical issues that commonly arise when responding to the death of an Arizona resident or property owner.  Each chapter provides advice and explanations to help you wade through the complex, and often bizarre, legal requirements associated with estate and trust law in Arizona.  Written in easy-to-read question and answer format, the Arizona Estate Administration Answer Book covers a comprehensive list

A DocuBank membership provides 24/7 access to your health care directives.  You will receive a wallet card instructing medical providers how to instantly acquire copies of these documents, plus any other health-related information you choose to make available.  DocuBank also offers an online SAFE to store copies of your estate planning documents in one secure place. NEW for 2022:Most estate plans prepared by Bouman Law Firm include a 1-year complimentary membership to DocuBank (others qualify for a discounted rate). Click here for more information.

First, the good news:  On 1/1/2022 the Arizona homestead exemption amount increases from $150,000 to $250,000.  The homestead exemption, which is automatic in Arizona, is intended to protect an Arizona resident’s primary residence (“homestead”) from creditors.  But the new law includes several intricacies that make it more complex than it initially appears.  For example, the new law requires any existing judgment liens (recorded in the same county) to be paid when the homeowner either sells or refinances the residence.  The prior law stated that a homeowner with less than $250,000 equity could still refinance a home loan without having to

No, because the LLC must have a legitimate business purpose.  A business purpose would include providing a service, product, or usable space to an unrelated person or company.  Every small business provides a service or product, or both, to the general public, while investment real estate provides a place to live or do business.  Your personal residence does not have a business purpose and neither does your personal investment brokerage account.          Arizona residents qualify automatically for a homestead exemption, which protects up to $150,000 of equity even if a judgment creditor forces a sale of the home.  For homeowners with

Many people I meet would benefit from an irrevocable asset protection trust, a strategy generally assumed to be too complicated and too expensive.  But I am not referring to families with vast inherited wealth or the Mark Zuckerberg-type entrepreneurs.  So how do you know if an asset protection trust might be right for you?  Consider the value of these assets you may own:

The amount of equity in your personal residence above $150,000;

The value of your financial investments (savings, brokerage accounts, notes receivable, etc.) not held in a retirement account;

The value of your investment real estate (other than