CASE LAW FIRM, LLC - Law Blog

Do I Need a Prenuptial Agreement?

Wed, 20 Sep 2017 14:22:07 -0400

CASE LAW FIRM LEGAL INSIGHTS

Posted on September 20, 2017 by Case Law Firm

Until death do us part is the intent; the reality is that half of marriages in Connecticut end in divorce. Recognizing that many marriages do not last a lifetime, a Prenuptial Agreement (commonly referred to as a prenup) can prevent prolonged litigation, and the accompanying rancor, by addressing financial issues while both parties have each other’s best interests at heart.

What can you accomplish with a Prenuptial Agreement? As of 1995, there is a statute which sets forth matters that may be agreed upon prior to getting married, such as the disposition of property, the modification or elimination of spousal support, and the right to life insurance proceeds or retirement plans. In addition, you may agree to make a will or trust to carry out provisions within the agreement. Essentially, any matters that do not violate public policy or incur criminal penalty may be settled with the Prenuptial Agreement, with the primary limitation being that you may not adversely affect the right of a child to support.

A further benefit to a Prenuptial Agreement is the agreement to utilize mediation and arbitration, rather than fighting a lengthy court battle. Without agreement, the more informal setting provided with arbitration could not be forced upon you.

The Prenuptial Agreement is a contract, and as such, will be binding if it is not unconscionable at the time it is written and at the time it is to be enforced. It is important that each party be independently represented by counsel and make a fair and reasonable disclosure of the value of their assets. The process encourages communication about financial responsibility and provides certainty as to future financial security.

If you are planning to get married, we will be happy to meet with you to determine how a Prenuptial Agreement will work for you. Please call our office at (860) 391-6393 to schedule a consultation with one of our attorneys.

-Tina Case, Esq.

Disclaimer: While this blog provides general information, it does not constitute legal advice. The best way to get guidance on your specific legal issue is to contact a lawyer. To schedule a meeting with an attorney, please call one of our lawyers at (860) 391-6393. The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship.

What is the Best Way to Save for My Child’s Education?

Mon, 12 Jun 2017 16:13:30 -0400

CASE LAW FIRM LEGAL INSIGHTS

What is the Best Way to Save for My Child’s Education?

Posted on June 12, 2017 by Case Law Firm

Why worry? While your child might be a gifted scholar or phenomenal soccer player, the likelihood of getting a sports scholarship or scholastic scholarship to foot the college bill is slim. According to the NCAA “about 2 percent of high school athletes are awarded some form of athletics scholarship to compete in college.” CBSNews reports that “among full-time college students enrolled at four-year colleges, just .3% received enough grants and scholarships to cover the full cost of college.”

The time to plan for paying most or all of your child’s education is now.

Luckily there are ways to set aside money while your child is young that will benefit you; both at tax time, and when your child gets an acceptance letter to the college of their choice.

One way is to set up a custodial account. If done properly, this will qualify for an annual gift tax exclusion and the income produced is reported on the child’s tax return (if in excess of $1,050 – 2016 rate), not yours. The downside is that the amounts held in the account may make it more difficult for your child to get needs-based financial aid as the account is their asset. Students are expected to use about 20% of their own assets per year on their college education

If that is a concern, another option is a Section 529 Plan. This is an asset of the parent. As such, FAFSA will expect the parents to use about 5.5% towards the student’s college education. The earnings on this money are tax free when withdrawn for college expenses. There are two basic types of plans. Another recognized plan is the Section 530 Plan, or Coverdell ESA. This may be used for elementary and secondary schooling.

There are annual monetary limits, age limits on the beneficiary, and other factors to consider when setting up any of these accounts.

If you have children and want to plan for their education, we will be happy to meet with you and discuss your options. Make this a significant part of your estate planning. Please call our office at (860) 391-6393 to schedule a consultation with one of our attorneys.

-Tina Case, Esq.

Is it Better to Have a Trust or a Will?

Mon, 12 Jun 2017 15:59:24 -0400

CASE LAW FIRM LEGAL INSIGHTS

Is it Better to Have a Trust or a Will?

Posted on June 12, 2017 by Case Law Firm

The simple answer is that either one will do, depending on your specific circumstances.

The key is to have some form of estate plan. It is essential to have a trust or a will, or a combination of both. Your particular estate plan will depend upon your marital status, your plans for your heirs, and the extent of your estate. If you fail to establish an estate plan, you are assigning your wealth to the government to distribute for you according to its terms.

For example, if you die leaving behind your spouse and your parents and you have no estate plan, your spouse will inherit the first $100,000 of your intestate property and three-quarters of the balance. The remainder of the intestate property will go to your parents. This may not be what your spouse wants, and it may not be what your parents need. Make an estate plan and control your own wealth while protecting your loved ones.

Without an updated estate plan one of the following scenarios could happen to you and your family.

Scenario 1 – a significant life-changing event: In 1990 you marry Jane Doe and you execute a will which leaves your entire estate to Jane, even in the event of a later divorce. In 2000, Jane runs off with the family accountant and divorces you. You meet and marry the lovely Sue Smith in 2005 and live happily until your untimely death in 2010 leaving an estate valued at two million dollars. Guess who inherits? That’s right, Jane the cheat. The accountant closes his practice and they move to an island in the Caribbean. Sue may have a right to elect a life estate of one-third.

Scenario 2 – a significant change in wealth: In 1990 you have an estate valued at $50,000. You are married with two children. Your will leaves all your estate outright to your wife Mary. In 2000 you win the lottery. Yay! Your estate upon your death in 2010 is valued at five million dollars. Mary will not pay estate taxes under current law because of the unlimited marital deduction, but when she passes the estate to the two children at her death, estate taxes will significantly reduce the amount left to the children. This could have been avoided by creating a trust.

If you have reached the age of 18, you need to begin estate planning. If you have an estate plan in place, you need to review it to ensure that it meets your current family and financial situation. We will be happy to meet with you to determine how a trust or will, or a combination of both, will work for you. Please call our office at (860) 391-6393 to schedule a consultation with one of our attorneys.

-Tina Case, Esq.