The high profile Los Angeles divorce trial of Frank and Jamie McCourt that could decide the ownership of the Los Angeles Dodgers got underway yesterday with the testimony of an estate planning attorney the couple had engaged in 2008 to revise their marital agreement.

According to an Associated Press story, Leah Bishop testified that Frank McCourt told her in May of 2009 that he would not sign a revised marital agreement that shared ownership of the Dodgers with his wife, Jamie.  Bishop said the couple had originally requested that a new agreement be drawn up that would keep all their homes in Jamie’s name but make everything else jointly owned.  The original agreement had their real estate assets in Jamie’s name and their business assets in Frank’s name, which he said was done at her insistence, to protect their properties from potential business creditors.

The original agreement is at the center of the McCourt’s divorce dispute and could determine the ownership of the MLB team.  Frank says he is the sole owner of the team; Jamie says the Dodgers are community property.  Bishop, the estate planning attorney, testified yesterday that both Frank and Jamie told her in 2008 that they did not intend to keep their assets separate forever and wanted the Dodgers to be part of their community property.

So what’s at stake?  According to one of Jamie’s attorneys, if the original agreement is enforced, Frank’s asset share would be worth $1 billion, while Jamie’s would be worth “only” $70 million.

And the moral of the story?  Clarity in all things.  Especially estate planning.

For a clear understanding of how estate planning can help you protect your assets, contact our California estate planning law firm.

Probate is a legacy no one should leave – and thankfully, most people do want to spare their heirs the time-consuming, costly and lengthy process of having to go to probate court to transfer their assets upon death.  It takes some advance planning – and a little help from a California asset protection lawyer – but there are ways you can avoid probate in California.

Living Trusts. You can use a living trust in California to avoid probate for the assets you wish to pass on to heirs, be it real estate, real property, bank accounts, and more.  Your asset protection lawyer can help you create the trust document, name a trustee and transfer ownership of your assets to the trust.

Joint Ownership.  If you and your spouse or other person own property jointly and the ownership documentation includes right of survivorship, no other action is necessary to avoid probate in California once the first owner dies.  In California, there are two types of joint ownership – joint tenancy and community property with right of survivorship.

Bank Account POD. Adding a Payable-on-Death (POD) designation to your bank accounts will allow your beneficiary to claim those accounts without probate upon your death.

Securities TOD. Registering your stocks, bonds and other securities in Transfer-in-Death (TOD) form allows your beneficiary to inherit those accounts automatically upon your death, without the need for probate.

For more information on avoiding probate in California, contact our California asset protection law firm.

If anyone kept statistics on such things, Friday is probably the workday that has more people thinking about retirement than any other day of the week.  But being mentally ready to retire is not enough – you also must be financially ready.  Here’s how to tell:

Do you have a predictable income source? If you are already fully vested in your pension plan or 401 (k) and have reached the age when you can begin taking withdrawals, having a guaranteed source of income is an important sign that you may be financially ready to retire.

Do you have cash on hand? Having enough cash on hand to pay for initial retirement costs is another thumbs-up.  You don’t want to have to cash out your stock to pay for your living expenses.

Do you have affordable health insurance? If you are not yet eligible for Medicare, having affordable health insurance is key to a healthy retirement.

Do you have an estate plan in place? Having already done your homework in terms of estate planning and investment planning is important so that an unforeseen expense doesn’t totally disrupt your retirement plan.

Are you really ready to retire? Or did you just have a bad week or month?  Working longer will help you in a number of ways – you have more time to save and plan, and you put off touching your retirement savings, which means they will last longer.

A California estate planning attorney can help you determine the best time for retirement; contact our Newport Beach estate planning law firm for more information.

Prop 8 politics aside, most unmarried couples in California – gay or straight – should know that estate planning is essential to provide the necessary legal protections for passing on property and other assets, making medical decisions for each other and planning for the future of any children that may come from the partnership.

In California, unmarried couples can enter into a civil union or domestic partnership that will give them several of the same legal rights that married partners enjoy — however, these laws do not protect you if you move out of state.

So, if you have not entered into a civil union or domestic partnership, what protections can estate planning provide to you?

First, inheritance.  No matter how long your relationship lasts with your significant other, if one of you dies without a will, your assets will not automatically go to the other.  So designating your life partner as your heir via a will or trust is imperative if your wishes are that he or she inherit your estate.

If you want to be able to make medical decisions for each other – especially in case of a traumatic injury or other emergency – you need to give your partner a Durable Power of Attorney for Healthcare.  This will allow your partner to have full access to your medical records, your physicians and will empower them to be able to make medical decisions for you if you cannot.

And if you want to be able to make financial decisions for each other, another Durable Power of Attorney can be put in place that grants those rights to each partner.

If your company’s employee benefits plan or the servicer of your other retirement accounts does not allow you to name an unmarried partner as beneficiary, you may be able to create a trust to receive those assets upon your death, and make your partner a beneficiary of that trust.

Estate planning tools like health care directives, living trusts, durable powers of attorney, guardianships and conservatorships can help unmarried partners put in place some important legal protections for their families and each other that married couples automatically enjoy just by being married.

For more information on proper estate planning for unmarried partners, contact our California estate planning law firm.

According to a Reuters article, many financial planners are urging wealthy clients to give assets away to children and grandchildren, calling 2010 “the golden era” for gifting assets.

Why?

The estate tax is still gone for 2010 and taxes on generation-skipping transfers were also eliminated this year.  However, next year both come back – the estate tax at a higher 55 percent rate and the generation-skipping transfer tax at up to 55 percent.  Moving assets out this year through tax-free gifts, intra-family loans and trusts makes sense the more the clock runs out on 2010 and Congress does nothing to reinstate a retroactive estate tax – which many experts say will not happen.

However, Congress is expected to make a move on the GRAT, or grantor-retained annuity trust.  Currently, you can transfer any assets that are expected to rise in value to a GRAT and receive payments for a minimum of two years.  Gains in the GRAT assets go to beneficiaries tax-free.  Congress is expected to start making some distributions taxable and extend the minimum term to ten years.

Gift taxes fell to 35 percent this year, from 45 percent in 2009, but will vault back up to 55 percent in 2011.

If all this uncertainty has your head spinning, contact our California asset protection law firm for help in developing the perfect estate plan for your family and these uncertain times.