Solution #1: Saved $821,000 in taxes and probate costs. The clients came in with a Simple Will written many years ago and an estate valued at $4,950,000. We created trusts that would utilize the full estate tax exemption for each of the clients, and also avoid probate proceedings in the event of incapacity and at the time of death. These strategies reduced the family’s taxes and probate costs from $1,727,000 to $906,000, resulting in total savings in taxes and probate costs of $821,000. The trusts also included asset protection provisions that would keep the estate from being re-taxed in the children’s estates, and protect the children’s inheritance from their creditors and divorce property settlements.

Solution #2: Salvaged estate tax savings after brokerage firm mistake. We created trusts that would fully utilize the husband and wife’s estate tax exemptions, and provided the clients with documentation as to the appropriate beneficiary designation and ownership of the assets. After the wife’s death, we discovered that the brokerage firm had failed to establish the correct transfer on death (TOD) designation on the investment account set up to fund her trust. We salvaged the tax savings by utilization of a disclaimer, the pour-over will, and probate proceedings, in order to fund the wife’s trust with the investment account, thereby salvaging the estate tax savings.

Solution #3: Structured the transfer of a business to avoid both capital gains and income taxes. Our client developed Lou Gehrig’s disease. His goal was to transfer his business to his son and daughter, who had worked in the business for a number of years. The business had substantial retained earnings that were invested in equities through the corporation, which he wished to retain for the future security of his wife. This man had planned to pay out the retained earnings as compensation or as dividends to himself; however, doing so would have required him to pay capital gains tax at the corporate level and ordinary income tax at the personal level on the full value of the retained earnings.As an alternative, we suggested a plan in which he would transfer the operating aspect of the business to his son and daughter in exchange for a payment equal to the retained earnings. Through a series of sophisticated steps, we protected our client’s assets so he owed no capital gains tax on the purchase price the children paid for the company’s stock – and the children avoided an income tax liability of $262,000.

Solution #4: Arranged assets so the wife would qualify for Medicaid immediately. At the time these clients retained our law firm, the wife was hospitalized with a medical prognosis indicating she would require nursing home care following her hospitalization. The husband was scheduled to undergo serious surgery, and his overall condition was relatively poor. The clients had a joint trust prepared a number of years ago, which held title to all of their assets, and which transferred that title to the surviving spouse in the event of a death. We used the existing trust ownership of the home to make it a Countable Asset for Medicaid Qualification purposes. This increased the amount of the Spousal Allowance available to the husband. Now they could benefit from the Spousal Allowance in full. We used a variety of tools – including a Revocable Probate Avoidance Trust and a Retained Life Estate – to create the best possible outcome for the family. As a result, the wife immediately qualified for Medicaid benefits to pay for her nursing home care, and all of the assets were retained in the family for the husband’s security, and inheritance by the son.

Solution #5: Corrected estate planning documents as medical problems neared. We reviewed the client’s existing documents when the client began to develop mental and physical conditions that could lead to nursing home care. Next we corrected the documents to add essential provisions, including the power to make gifts and the power to create trusts that would allow Medicaid qualification planning when nursing home care became necessary. Without these essential provisions, the necessary transfers to qualify for Medicaid would have been incomplete transfers for gift tax and Medicaid divestment purposes.

Solution #6: Corrected estate planning documents drawn by an inexperienced attorney. We represented a client who had documents drawn by an inexperienced attorney. We restated the documents to make them functional and effective, and to add essential provisions such as the power to make gifts. In addition, we added provisions allowing the creation of Irrevocable Trusts for Medicaid qualification planning, as well as assisted the client in setting up the ownership and beneficiary designations to ensure that all of her assets would avoid probate proceedings in the event of her incapacity or death.

Solution #7: Removed ex-husband from Estate Plan and protected daughters’ interest. Our client returned to our office following her divorce. She wanted to update her Estate Plan and remove her ex-husband from her plan. Our client’s parents had prepared Asset Protection Trusts for her and her siblings. However, she had inherited $200,000 directly from an uncle. During our discussion, she realized that 50% of the inheritance she received from her uncle had been given to her ex-husband as part of the property settlement in the divorce proceeding. She had completely forgotten that the inheritance had been com-mingled with the marital property. We established Asset Protection Trust provisions for her two daughters, so that the inheritance she will leave to them will not be at risk if they are involved in divorce proceedings.

Solution #8: Saved thousands of dollars in legal fees by avoiding a costly trial. Our firm was retained to assist the client in a proceeding in which his sisters were attempting to establish a conservatorship over his assets. We were able to establish that he did not need a conservatorship, that he could make decisions on his own, and obtained an acknowledgment of this fact from the sisters. We therefore had the conservatorship proceeding dismissed and prepared an estate plan for this individual, in which he left his assets to persons other than the two sisters. When he died, the two sisters contested his will on the basis that he was incompetent and subject to undue influence at the time he executed the documents. Drawing upon our knowledge of the Michigan probate code and the recognition that we had obtained an admission from the sisters earlier that the client was in fact competent shortly before he executed his estate planning documents, we filed a motion for summary disposition in the probate court, which was granted. The sisters’ objections to the will were dismissed by the court. The probate court’s ruling was later con-firmed on appeal. This process saved the estate thousands of dollars in legal fees that would have been required to try the case before a jury.

Solution #9: Saved $150,000 in taxes for incompetent person’s estate plan referred by judge. Our firm was retained by the probate judge to assist with tax planning for an elderly individual who was suffering dementia and had not completed her estate plan prior to the time that she became incompetent. Drawing upon our knowledge of the Michigan probate code, the power accorded to probate judges with regard to estate planning for incompetent individuals, and our understanding of the tax laws, we recommended an estate plan for this individual, implemented through the court, which resulted in tax savings to her estate of $150,000.

Solution #10: Saved the probate estate and trust $125,000 by avoiding further litigation. Our firm was retained in a will and trust contest case, which had been ongoing for approximately 4 years. The prior attorneys had been unsuccessful in bringing the matter to conclusion, and the client had spent more than $200,000 defending against the claims made by a beneficiary of the estate. When we entered the case, the client had budgeted an additional $150,000 to continue defense of the matter. After reviewing the facts of the case, we were able to recommend a strategy to the client, which enabled us to settle the matter without further litigation and to the full satisfaction of the client. The settlement saved the probate estate and trust approximate $125,000 in legal fees that would have been required to try the matter to conclusion.

Solution #11: Ended a 2-year conservatorship proceeding that would have lasted 5 more years. A client was referred to us in connection with the death of his roommate. The roommate had disappeared, approximately 2 years before our involvement. An investigation by the police indicated that the roommate had been murdered in his home and the body disposed of elsewhere. Because the body had not been found, the client had not been able to obtain a death certificate for the roommate and bring closure to this tragic situation. Based upon our knowledge of the Michigan probate code, we were aware that probate judges have the ability to declare an individual dead in circumstances similar to those presented in this case. We filed a petition with the probate court and obtained an order allowing the issuance of a death certificate for the missing individual. As a result, a conservatorship proceeding which had been ongoing for two years was brought to a close. The client was able to complete administration of the dead roommate’s estate, finalize all tax matters and make complete distribution of the missing individual’s assets in accordance with his estate planning documents. Had we not become involved, the conservatorship would have proceeded for another five years because the initial attorney representing the client was relying upon an earlier probate statute which indicated that a conservatorship for a missing individual could not be closed for a period of seven years after his disappearance.

Solution #12: Replaced trustees with independent trustee and saved client $550,000. A client was referred to us by a law firm in Grand Rapids. The case involved a trust which had been established by the client’s father, who had remarried. The second wife and an accountant were appointed on the document as successor trustees. The terms of the trust were not being followed, and the second wife was receiving a significant monthly distribution, with the net effect that all of the assets of the trust would be depleted and the client and her siblings stood to receive nothing. Shortly before our involvement, the accountant had resigned and had been replaced by a probate attorney as independent trustee. Through our efforts, the probate attorney and second wife were removed as trustees and an independent trustee was appointed by the court. In addition, the accountant and the attorney as trustees were sur-charged by the court for failing to administer the trust for all of the beneficiaries, including our client and her siblings. As a result of the litigation, our client and her siblings stand to receive approximately $550,000, which they otherwise would never have had any chance to recover.

Solution #13: Set up Special Needs Trust so child’s inheritance would not go to the state of Michigan. We were retained by parents of a child who had been severely injured in an automobile/bike accident. The child was designated to receive a substantial sum of money under a trust established by his grandparents. The child was turning 18 and the parents were looking for some way to protect the trust assets from being used by the State of Michigan for the care of the individual, who was then residing in a group home and was receiving Medicaid assistance. We recommended establishment of a special needs trust for the child, which was implemented through the probate court. Under the terms of the trust, all of the proceeds from the grandparents’ trust would be held in a trust for the benefit of the child and would be available to provide for the child during his lifetime. At the same time, the child would continue to qualify for Medicaid assistance. At the death of the child, any remaining assets in the trust would be used to reimburse the State for Medicaid benefits received by the child. The net effect was to preserve the trust assets for the benefit of the child during his lifetime, rather than having them paid over directly to the State of Michigan when they were distributed from the grandparents’s trust.