Is Deeding Property Protection Against Estate Tax?

Sivia Law

Todd Sivia
Managing Partner, Sivia Business & Legal Services

Estate Planning is a topic no one wants to think about. But, unfortunately, estate planning requires a lot of thinking and careful preparation. Often, a seemingly harmless act has catastrophic, rippling effects on other family members. For example, aging parents are looking for ways to protect their children’s inheritance from probate or estate taxes. Unfortunately, all to often parents are deeding their homes to their children, thinking it is a less expensive and easy way to transfer ownership. However, there are several reasons to avoid this alternative.

First, let me define what it means to “deed your residence.” Simply put, it means transferring the title to your children’s name without a formal sale. If the parents are ready to down size to an assisted living facility or prefer to remain in the home but are concerned about future estate taxes, deeding property appears ideal.

But, if the transfer is completed within five years before the parents require nursing home care or government benefits, it can cause a delay in Medicaid eligibility.

Additionally, if the property is in Illinois, there are property tax exemptions for owner-occupied property and senior-occupied property. So unless the children are moving in with the parents, or the children are over 65, the property tax bill will go up.

And what happens if the property is deeded to an adult child, and that child subsequently gets divorced? The ex-spouse is entitled to half of the property. If the parents’ intention was to stay in the home, this divorce could significantly alter those plans.

Finally, if aging individuals sells their property, its exempt from capital gains tax. However, if the property is deeded to the children and they sell it, the children may be looking a substantial capital gains tax liability.

No, estate planning isn’t fun. It can be stressful. But, mostly, estate planning needs to be strategic.

If you have questions regarding a contract for deed, or any other estate planning options, you can contact me at 618-659-4499 or e-mail me at info@sivialaw.com. You can also visit our website and learn more about our estate planning strategies at www.sivialaw.com/estateplanning.

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The Signals of Success

Todd W. Sivia Attorney-at-Law

Todd W. Sivia
Attorney-at-Law

I recently read an article featuring a law firm that leased expensive cars as a way to signal the firm’s success. This got me thinking about what signals I want to use—and which ones to I wish to avoid.

While I can certainly appreciate anyone’s desire to drive an expensive car, I think I want people to associate my firm’s success with something more substantial. A flashy car may make a good initial impression, but it doesn’t demonstrate my experience or skill as an attorney.

I think Albert Einstein was right when he said, “Try not to become a man of success, but rather try to become a man of value.” I believe success comes from the satisfaction of the people you serve.

In fact the greatest affirmation of success, to me, is a referral from a client.

A referral is the tangible result of someone else’s trust. Once you earn a client’s trust, that person becomes an advocate for you. And you can’t put a price on that kind of success. It doesn’t come easily, but success rarely does.

For the last 8 years I have worked hard to cultivate a firm where clients are confident in our abilities and know we have their best interests at heart. It isn’t about what we drive or how big our building is. It is about the relationships we build with our clients simply by providing superior service at a reasonable price.

Sure, I could lease a Mercedes. Maybe that would impress some people and, possibly, lead to a few new clients. But instead of getting a fancy car and increasing my fees to pay for it, I think I will drive my GMC and continue building strong partnerships with my clients—my signal of success.

Concealed Weapons Are Legal In Illinois. Is Your Business Ready?

Todd 2 C  By: Todd Sivia, Attorney-at-Law

Concealed weapons are now legal in IL.  Are you prepared?

On Jan 1, 2014, the Firearm Conceal Carry Act went into effect in the state of IL. Many people believe this law will have no impact on them. After all, if you do not want to carry a gun and most businesses prohibit firearms, how could this law possible affect you? Believe me, it will.

But, first, let me briefly define concealed verses unconcealed weapons.

A  “concealed” weapon is a loaded or unloaded handgun carried on or about a person completely or mostly concealed from view of the public or on or about a person within a vehicle.

Unconcealed weapons, by contrast, are loaded or unloaded handguns, or other firearms, that are in clear view of the public.

Ok, so how is this law going to affect you? Do you work outside your home? Do you like to go to the mall? Eat out? The person next to you could be carrying a concealed weapon.

It is true that there are many places where firearms will remain prohibited—schools, hospitals, government buildings, etc. Most businesses will likely post a sign like this [show Gun Sign] which announces that the building prohibits firearms in the building and/or surrounding area.

You may have already noticed that businesses have posted signs at every entrance. But a sign alone may not absolve a business or property owner from liability. What if a customer or client brings in a concealed weapon anyway? What if it goes off? What would you do in that situation? Business owners and managers need to create a detailed action plan—in writing—and update employee handbooks to address potential issues.

You also need to be aware that most public parking lots are considered “safe harbors.” So, even if you are in a parking lot with a posted sign, a licensed individual can still have a firearm in their glove box or trunk. That individual also has the right to have the firearm out of the vehicle in order to transport it to the trunk or glove box.

Think about these scenarios:  You have your CCL and you are taking your gun out of your trunk and moving it to your glove box. Then you see someone else in the parking lot getting mugged. What do you do? What can you do? Is it legal for you to draw your weapon in a lot with a posted sign?

Then answer? Maybe.

What if your employer permits concealed weapons and a co-worker decides to carry one. The gun accidently discharges. Who is at fault? Your boss? The owner of your building? Your coworker?

The answer? It could be all of them. It could be none of them.

Unfortunately, there are a lot questions yet to be answered concerning the FCCA. There will no doubt be test cases in the coming years that will serve to define precedents for the rest of us.

In the meantime, however, there are things you should do.

If you are a property or business owner, be sure you understand the law as it currently stands. Be aware that application of the law is likely to change throughout the year. You also need to review your lease or employee handbook to be certain that this issue is addressed in writing.

If you are considering applying for your CCL, it is important to have a plan of action in the event your weapon is discharged—either by accident or in an incident.

Remember—there are a lot of gray areas surrounding the FCCA.  If you decide to carry a concealed weapon, it is a good idea to talk to your attorney and create an action plan. The key is to know your rights and respect the rights of others.

 

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