LLC Dissolution on the Death of a Member? Will Your LLC Terminate on Your Death?

By Lee R. Phillips

I recently handled a case where a successful businessman came in with what appeared to be a fairly comprehensive estate plan.  He wanted to simply ask some questions and look at long range planning.  I looked at the living trust, and at a quick glance it appeared to be reasonable. (Some of the living trusts are just a joke.)  I carefully quizzed him to make sure the living trust did what he wanted, i.e., distributed the property after his death to his family the way he wanted it to.  I also carefully quizzed him on funding the living trust.  Did it own the properties he had told me about?  Did it own the membership interests in his large LLC?  He assured me and the others in the room that it was fully funded.

Within a couple of weeks after our visit, he became very ill.  The family couldn’t find a durable power of attorney in his paperwork, so we quickly did one.  His daughter brought him into the office to sign the durable power of attorney, and on the way out I asked if she liked to read.  She said she loved novels.  I gave her a copy of my book, Guaranteed Millionaire, and assured her it read like a novel.  Yeah sure, was the look on her face.  About three days later she called.  After getting a couple hundred pages into the book, she decided to do some investigating of her own.  She couldn’t find deeds transferring her dad’s properties into the trust.  The book clearly said to look for the deeds.  No deeds!  A check at the county showed all the properties were still in dad’s name, not the trust’s name.  We hurried and got deeds made.  Dad signed the deeds in an intensive care unit. (more…)

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Q&A Jan 2010 How to Transfer a House: Annuities and Judgments: Family Trusts: Asset Protection Plan: Co-Trustee Duties: Types of Trusts

By Lee R. Phillips

We receive lots of queries from people who are struggling with the important issues of asset protection and estate planning. Periodically, we answer some of those questions for everyone to learn from, or at least help you see options that you need to discuss with your own trusted advisors.


Best Way to Pass Your Home

Q.  My girlfriend’s mother is in her early 60′s and has placed her house and another piece of property in her three daughters’ names. Her fear is that she may become ill and have to go in a nursing home and have to sell these. Their current value is approximately $600K. She wants the girls to inherit the properties. I am wondering if a Revocable Trust would accomplish this as well and protect the mother if one of the daughters were to get in trouble financially prior to her death so that the mother could always remain in the home. This situation is in Virginia. Chris (more…)

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2010 a Great Year to Die? I Don’t Think So

A note from Lee R. Phillips

You may be starting to see warnings about your estate planning in 2010.  The estate tax has been repealed.  All Right!!!  It is a great year to die.  NOT SO FAST.  Don’t kill yourself yet.  All is not what it seems to be.

First a little reassurance that what you have done using the LegaLees system is ok.  The warning says that under a lot of estate plans the surviving spouse (spouse that lives after the first one of the couple dies) can be left out in the cold.  That won’t happen with the living trusts and wills in the Accumulation and Preservation of Wealth set.  The warning is for wills and trusts that try to control estate taxes by passing all or part of the estate directly to the children, not the surviving spouse.

My goal is and always has been to protect the surviving spouse.  The trusts are set up so that a shelter trust is created which removes the maximum amount that the deceased spouse could pass to the children without an estate tax (the “exemption equivalent” as the amount is called in the legal industry).  That amount changes.  It has been going up for the last decade, from $1 million to $3.5 million last year.  So if a couple had $4 million in assets and the husband died in 2009, a trust (Trust B) would have been created to “shelter” $3.5 million from estate taxes when the wife died.  This whole thing is explained in detail in my book, Guaranteed Millionaire.  It is a great read (not a boring financial book). (more…)

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Lee Phillips, Attorney

Counselor to the United States Supreme Court

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