June 2022

For generations, the children in your family have learned to swim by jumping off of the dock of your family’s vacation home. It’s a rite of passage for each grandchild to learn how to bait a hook from grandpa while fireflies flicker in the summer heat. The legacy of a vacation home is the pinnacle of the American Dream. Many people work their entire lives to afford a home in their dream destination. While you dream of passing down this home (and the memories) for generations to come, have you thought of how to protect this family legacy?

 

Leaving the family vacation home directly to your children may be the simplest way for transferring ownership, however, when multiple children are involved, they would all need to agree with how the property is managed and maintained in the future. These decisions are proven to be challenging not only for your children to agree on, but also their future spouses.

 

An LLC is often used by families, in which each family member would have a certain membership interest in the home or to give away in a controlled manner. If the home is rented at certain times of the year, the LLC can help limit the liability of the family and profits could be used to help maintain the property.

 

Trusts are another tool used to protect a family home. This legal agreement allows you to specify how you would like the property to be managed once you die. You can use the trust to identify who will own your vacation home, when they will have access to it, and what they will be allowed to do with the property.

 

One of the many benefits of placing your vacation home in a trust is to avoid probate. When you pass away, assets that legally belong to a trust will be passed on to your beneficiaries without going through probate. There are several trust options available to align with your specific needs. I few most common trusts are:

• IRREVOCABLE TRUST
  The house can be placed into an irrevocable trust with your children named as beneficiaries. The terms of the trust would outline the management and use of the home. An irrevocable trust helps to protect the family from possible creditor liens.
• REVOCABLE TRUST
  A revocable trust can be used to transfer the property to family members at the time of your death. This option can set up what is called a subtrust to manage your vacation home after your death. There is usually a set amount of money set aside in the trust to help care for the property for a period of time.
• QUALIFIED PERSONAL RESIDENCE TRUST
  This allows you to gift the property at a reduced value, while allowing yourself to use the property for a set amount of years, after that time has expired the home can transfer directly to family or to a trust for future generations.

Preserving your family’s legacy of summers full of fun is important to avoid future family conflicts and avoiding litigation. Choosing the right financial structure for your family to enjoy and use the property will help guarantee family fun for future generations.

 

Digital technology has transformed the way we live. Our society has irrevocably plunged into the digital world. As technology becomes ever more deeply embedded into our daily lives, we need to plan accordingly. “Digital Assets” is a broad term that includes a multitude of online accounts and records. A digital Will enables you to identify how you want each one of these profiles to be handled after your death. A digital Will is not the same as a traditional written Will, which is a legal document specifying how your assets will be distributed after death. You can pass some types of digital assets through your Will, but most digital assets transfer in other ways, or not at all. Online accounts and digital media have value and they could be locked or even lost if you don’t set up the appropriate protection in your Will.

 

Practically speaking, most of your digital assets won’t pass through your Will. However, even if you can’t pass these types of digital assets through your Will, you can (and should) make a plan for what happens to them after you are gone. In addition to notifying your loved ones of what online accounts do exist, your Will should also describe where to find them.

 

In most cases, your family members won’t know what you have floating in cyberspace once you die. Each website has its own requirements and legal processes for accessing accounts after death. There are a few actions you can take to make things easier to access and for your loved ones to know how you would like your digital accounts to be handled after you are gone. Between the many types of digital wallets and various online exchanges, your family will most likely be on a wild goose chase unless you make it clear where this information can be found.

• Bitcoin and other cryptocurrency
• Social media profiles
• Frequent flier miles
• Credit card reward points
• PayPal
• Venmo
• Online dating profiles
• YouTube accounts
• Prescription subscription accounts
• Crowdfunding accounts
• Access to digitally filed tax returns
• Website ownership
• NFTs
• Email accounts

Leaving digital assets to your loved ones after your death requires more planning than traditional and tangible assets. With a little planning, you can ensure that your beneficiaries inherit your accounts as you intended. We can help you with documenting the appropriate information and notifying your loved ones of your digital assets, along with your traditional Will.

18111 Von Karman Avenue, Suite 460
Irvine, CA 92612-7152
Phone: (949) 222-2000
www.EstateTrustLawyer.com
www.CAAssetProtection.com