Are Life Insurance Proceeds Part of a Succession?

In Louisiana, the general answer to this question is no. Life insurance proceeds are not part of a succession. This can be confusing because both successions and life insurance claims both result from someone’s death. So, it is often assumed that they are handled together.

However, it is important to remember that life insurance is not part of the estate of the person that died. The decedent doesn’t own the life insurance proceeds. The insurance proceeds are contractual in that they are paid to the beneficiary on the condition of the decedent’s death.

 

So, if there is a beneficiary that has survived the decedent, that beneficiary does not have to open a succession with regard to those insurance proceeds. The surviving beneficiary will probably only have to submit a death certificate and the insurance company’s application to obtain the life insurance proceeds.

However, if the beneficiary named in the life insurance died before the decedent or the decedent named their estate as the beneficiary, these life insurance proceeds would have to be handled in the succession.

If you have any questions concerning successions, you should consult an experience estate planning attorney.

 

Kent S. DeJean

 

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Small Successions

In the past, many heirs were reluctant to open legal succession in Louisiana due to the fees and costs. There is a perception that opening a succession even for a small one, is expensive.

However, recent Louisiana legislation now makes completing a small succession relatively easy without having to file succession pleadings and incurring expensive fees and costs.

If the decedent died without a will and the net value of the decedents estate is worth less than $ 75,000.00, then this type of small succession may be done by affidavit.

The heirs will be required to follow the statutory requirements as to its execution and form for this affidavit.

This small succession procedure affidavit is not the answer for all small successions. If the heirs are fighting, if there is litigation, or if the assets and debts are not known, it may still be necessary to open a legal succession with the courts.

As always, heirs should consult an experienced succession attorney before taking any action on their own regarding a succession.

 

 

BEWARE OF REVOCABLE LIVING TRUST

Many consumers are executing Revocable Living Trusts. They are being sold on this product on the promise to avoid a succession and probate.

Revocable Living Trusts do help the person avoid succession and probate. But, that’s all it does and this benefit may not be as valuable as one might initially think.

Some Revocable Living Trusts are expensive and may costs as much as a small uncontested non problematic succession. So the financial benefit that you get, may not be as great as you think.

What is important to remember is what Revocable Living Trusts do not do! Revocable Living Trusts are revocable. This means you can remove any property you put into that trust at any time.

Since you can remove the property from the trust, there is no asset protection. If you owe money, your creditors will be able to seize whatever assets you placed into the trust.

Also, you obtain no tax advantage to creating a Revocable Living Trust. You will continue to pay your taxes the same way you always have paid them.

Finally, placing property in a Revocable Living Trust does not shelter it from government entities for you to pay for your long term nursing home care. Medicaid and the Veteran’s Administration will count all property placed into a Revocable Living Trust just like you own it. There is a five (5) year look back period for Medicaid and there may also soon be a look back period with the Veteran’s Administration. You may be missing out on an opportunity to shelter your assets while you are healthy by placing your assets into a Revocable Living Trust.

To obtain additional information on legal and innovative estate planning strategies, you should always consult an experienced estate planning attorney. Kent S. DeJean

Will I Owe Louisiana State Inheritance Taxes?

The answer to whether you will owe estate taxes in a Louisiana succession, is probably no.

Under Louisiana law, there are no inheritance taxes for estates of persons that died after June 20, 2004.

There are also no inheritance taxes for estates of persons that died on or before June 20, 2004 as long as an inheritance tax return was not filed before July 1, 2008.

It is unclear whether estates of persons that died on or before June 20, 2004, which filed an inheritance tax return before July 1, 2008 will owe estate taxes.

If you have any questions on successions, contact an experienced estate attorney. Kent S. DeJean

What Do I DO If I Left Off A Succession Asset?

Heirs and legatees are required to file a Detailed Descriptive List with the court in a succession. A Detailed Descriptive List itemizes all debts and assets of the person that died as of the date of death under oath. Although heirs and legatees should make every effort to present to the court an accurate list of assets, assets can be left off by mistake.

Heirs or legatees may discover real estate or bank accounts belonging to the decedent after a Judgment of Possession is rendered.

If assets are discovered after a Judgment of Possession is rendered, it will be necessary to file a Supplemental Petition for Possession along with a Supplemental Detailed Descriptive List itemizing the missing asset. After permission is granted by the court, a Supplemental Judgment of Possession can be rendered by the court to add the additional asset.

If you have any questions concerning successions, contact an experienced estate attorney. Kent S. DeJean

Reasons A Succession May Need An Executor Or Administrator

Many people are surprised to learn that under Louisiana law, an heir or legatee is not required to have an executor/administrator appointed by the court to administer the estate of a person that has died. In fact, the heirs and legatees are placed directly into possession without the need for an administration in most Louisiana succession.

However, there are situations where having an executor/administrator appointed by the court to administer the estate of a person that has died, is recommended.

1. We don’t know what the decedent owned property or debts that were owed at the time of death. It may be necessary to appoint an administrator or executor to investigate. Through this appointment, an executor or administrator will have the power to change the mailing address for bills and statements, open mail, and speak to banks and other companies in order to investigate.

2. The heirs or legatees are fighting. If there is a dispute amount their heirs or legatees of the decedent, it may be necessary to appoint an executor or administrator to administer the estate or facilitate completion of the succession pending litigation of the disputes.

3. There maybe lawsuits pending. If there is litigation pending either on behalf of the decedent or against the decedent, it may be necessary to administer the estate while the litigation is pending. Otherwise, the heirs and legatees may not know whether the estate is solvent or not.

4. There may be an ongoing business. It may be necessary to manage an ongoing business which the decedent had an ownership interest pending the completion of the succession to prevent problems with continuation of business activities.

If you have any questions concerning successions, you should consult an experienced estate attorney. Kent S. DeJean

How Soon Should I Open A Succession?

Unless you have a multi-million dollar estate which requires that you file a Federal estate tax return within nine (9) months of death, there are no deadlines to file a succession within a certain time after the death of your loved one. Therefore, you can take your time from a legal standpoint under Louisiana law.

From a practical standpoint, it isn’t a good idea to procrastinate very long. It is in your best interest that you retain an attorney and commence the succession proceeding as quickly as possible. There are several important reasons to proceed as soon as possible.

First of all, the law requires that a Detailed Descriptive List be prepared listing all assets and debts of the person that died on the date of death. It will be difficult to get an inventory of the assets and debts as time passes along. Persons that have knowledge of the estate may lose capacity or die. Institutions that have information may close. Assets can be lost, deteriorate and change.

Secondly, it will be impossible to transfer title to certain assets such as vehicles or real estate completing the legal succession proceedings. You may miss a sale because you don’t have the titles transferred to the heirs or legatees.

Thirdly, heirs and legatees may die. This can complicate the original succession by requiring that a second succession be commenced for the heirs and legatees of the deceased heir. This can cause even more delays and expenses. Further, the new heirs and legatees will add additional persons to notify and/or obtain their signatures for pleadings. Also, the new heirs and legatees may not be so agreeable and may make the succession contested. This can lead to an expensive litigation.

Should you have any questions, you should contact an experienced succession attorney. Kent S. DeJean

Beware! Without A Will Separate Property Is Not Inherited By Your Spouse!

Under Louisiana law, separate property is any property that:

1. You owned before you got married;
2. You inherited; or
3. Was given to you individually; or
4. Was acknowledged to be your own property by your spouse.

Most are surprised to learn that their spouse will not inherit your separate property if you die without a will. It is your children and your family that will inherit any separate property you have when you die pursuant to Louisiana law.

If you want your spouse to inherit your separate property, you must provide for it in a valid will.

If you have any questions concerning wills, please consult an experienced estate planning attorney. Kent S. DeJean

Will My Spouse Get My Inheritance In The Divorce?

Under Louisiana law, the answer to the question is maybe.

The general rule under Louisiana law, is that inherited property is considered to be the separate property of that spouse and the other spouse is not entitled. In fact, the other spouse is not even entitled to it even if the inheritance was obtained during the marriage.

The problem is that assets change. Assets are liquidated, sold, and co-mingled with other community property. Also, income may be made on a separate asset which is community property and could be mixed back in with the separate property. Over time, an asset may start out as a separate asset only to slowly become mixed up with community property. This is particularly true of investments.

If you want your inheritance to remain your separate property, there are several things that can be done to protect your rights:

1. Have the spouses execute a Community Property Partition or an Act of Acknowledgment declaring the asset to be the separate property of a particular spouse;

2. Keep very accurate and complete records of separate assets; and/or

3. Enter into a Post Nuptial Agreement with court approval.

Should you have any questions on divorce, contact an experienced divorce attorney. Kent S. DeJean

Wills Are Not Secrets

One of the popular public myths is that wills are a big secret. From a practical stand point, this is not entirely accurate.

The fact that you have a will should not be a secret.

What is contained in the will can be a secret.

You should be very public about the fact that you have a will and where the will is located to those persons, who are named in the will.

You can be so secretive to the point that no one can find it. That defeats the whole purpose of having a will.

If you have any questions about wills, you should consult an experienced estate planning attorney. Kent S. DeJean