Key Steps in Asset Distribution

Key Steps in Asset Distribution

Who gets what?

It is common for individuals to arrive at our law offices wanting to “finally get our estate plan done” and focusing on such components as establishing wills and trusts, identifying trustees and beneficiaries, and setting up power of attorney and medical directives.  Yes, these are all important parts of an estate plan — but they often lose sight of a critical aspect (and perhaps the most difficult) of estate planning – who gets what!

More than just “splitting it up”

It can be enjoyable watching your portfolio of investments and other assets grow over time, building into what may be a sizable fortune.  You’ve worked a lifetime to nurture and build these assets, so why not take the time to make certain your heirs benefit as you intend?  Have you considered that planning for these assets after your passing may be far more important than just “splitting it up”?

A key aspect of our estate planning is working with our clients to identify assets, specify who will get them, and achieve their goals in distributing each asset to specific heirs.

What’s in your portfolio?

The first step is to identify and classify your assets. This is necessary in order to know how to properly allocate those assets after your passing. These assets would include business ownership, real estate (primary residence, vacation homes, and investment properties), financial institution investments (i.e., stocks, bonds and annuities), insurance, cash and savings accounts, foreign assets, and personal property. It isn’t unusual for clients to forget about a certain real estate holding or jointly-held business enterprise.

What are your goals?

This is clearly tailored to each client and requires careful consideration. Perhaps your entire adult life you’ve been building a business, investing in the stock market, buying real estate or obtaining other assets, all done in order to provide for yourself and family. However, when it comes to distributing those assets to beneficiaries it requires a different mindset. For example, is it important to you that a multi-generational business stay in the family? Further, if equitable economic distribution is a goal, this can be a complicated step, especially with different asset classes, liquidity, taxation, and short- and long-term asset growth.

Considerations in asset distribution

  • What is the short- and long-term value of each asset? This can be complicated but may be key to your goals.  Consider if you were to designate your oldest child to receive the family business (which may generate considerable annual income but could be difficult to sell), while the youngest child receives your IRA/stock market investments (which must be distributed over 10 years per the Secure Act of 2019, and subject to taxation).  Or giving one child a family heirloom vacation home and another child a rental property (i.e., the former has annual costs and is not to be sold, while the latter can be sold and likely generates income).  Each scenario requires careful consideration.
  • Are some assets costly to maintain? This would include maintenance and property management for real estate, fees for investment management, and professional managers for businesses. This evaluation can be important to a surviving spouse and heirs; can they afford it and does it make sense for them?
  • Are some assets better held by one heir vs. another? If your estate is simply an even sell-and-split of all assets, this is a simple task.  Yet quite often assets are distributed differently.  Is it best for a certain child to own your business? Should another child be given illiquid assets because he/she would spend cash to quickly?  How to designate real estate if your heirs live across the country and may not want it?  Do certain assets hold sentimental value?
  • What about liquidity and taxes? Liquidity is a consideration across all asset classes. For example, a rental property may be illiquid vs. cash but your heirs can keep it as an investment (which may mean relatively low near-term income) or sell it and reap the proceeds. Keep taxation in mind when gifting certain assets to specific heirs, as IRA accounts are subject to taxes.

Attorneys who understand the importance of your assets

At Mortensen & Reinheimer, PC we realize that your assets represent years of hard work and can hold not only financial but also sentimental value.  We know that our clients may have specific goals for certain assets and beneficiaries and need legal guidance in how to best achieve these objectives.  We look forward to helping you with this important process!  Please contact us at (714) 384-6053 to make an appointment, or use our online contact form. Our website is http://www.ocestateplanning.net.

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About the author:
Tamsen R. Reinheimer, Attorney, is a Certified Specialist in Estate Planning, Trust & Probate Law (The State Bar of California Board of Legal Specialization). She has significant experience in all aspects of estate planning, trust administration, and probate. Contact Tamsen at tamsen@ocestateplanning.net.

Now Available – Thread Liftsfor Your Body and Face

Summer is here- Enjoy it with a revitalized lookSummer is here. Enjoy it with a revitalized look.

Are you ready for non-surgical options to rejuvenate your face and body?

FACIAL REJUVENATION MADE EASY

For those who want to avoid surgery for their face, a popular option is Infinity Plus molded threads, made by NovaThreads.

  • Key benefits: Smooth skin texture, immediate results, and a non-surgical procedure.
  • How do they work? The threads are made of absorbable material.  They are placed underneath the skin to reposition overlying tissue to a more favorable location, while maintaining a natural appearance. As the threads absorb over time, new collagen is formed which will tighten your skin.
  • Where can they be used?  While threads can be placed almost anywhere, particular areas of concern for aging patients include the lower face, jaw and neck.  Other applications include: lifting the brows and cheek; and to soften fine lines, stimulate collagen, and tighten skin on forehead, around the eyes, and lips.
  • More info: Results last approximately 8-12 months. No incisions are required. The procedure is performed in our office. No anesthesia is required.

BODY THREADS

NOW AVAILABLE – BODY THREADS

Body thread lifts brings the same thread lift technology as non-surgical facelifts to enhance the body.  As such, body threads offer similar results, timing and procedural steps.

  • Key benefits: A body thread lift is an excellent option for those seeking a tightened or lifted look that is often acquired through surgery, yet without a surgical procedure. This technique can be combined with other cosmetic enhancement alternatives to give your body and skin a rejuvenating boost.
  • Where can they be used?  Typical problem areas that are great applications for body threads include elbows, knees, upper chest, abdomen, and neck.
  • Is there any downtime? There is generally a quick recovery time and usually you can expect to return to your routine as usual, with less swelling and bruising versus a surgical procedure.

MAKE AN APPOINTMENT TO LEARN MORE

We invite you to schedule a consultation to discuss the best options for your personal goals. Dr. Zeineh seeks to provide advanced cosmetic and reconstructive techniques combined with compassionate, personalized care for each patient.

Dr. Zeineh personally performs these procedures on her patients to achieve and maintain a youthful, refreshed, and natural appearance.

Ready to proceed? I am safely seeing patients in the office, following CDC guidelines. I am also available for telehealth phone consultations (657-722-1400) and photos and communication via HIPAA secure email at DrZ@DrZeinehPlasticSurgery.com.

Please let me know of any questions or concerns that you may have.

Thank you so much.

Sincerely,

Linda L. Zeineh, MD, FACS

Checklist of Cash Flow Crunch Warning Signs – REFS

Checklist of
“Cash Flow Crunch
Warning Signs”

Whether your client’s business is rolling along at full speed or barely managing to hang on, a “cash flow crunch” can be devastating in a very short time.

What is a cash flow crunch?
Cash flow is the inflow and outflow of money from a business. It is necessary for day-to-day operations, funding payroll, paying vendors, purchasing inventory and other operating costs.

Positive cash flow is when a business has more money coming in vs. going out; over the long-term, this is how value is created shareholders.

Negative cash flow is when more money is flowing out from the business in the form of accounts payable, debt and interest payments, payroll, rent and other expenses.

cash flow crunch occurs when a state of negative cash flow is substantial enough to impact operational functionality, either for a short or sustained period.

What are the warning signs?
Check out the “warning signs checklist” below and see if any of these traits are showing at your client’s business:

Revenue issues:
• Low sales volume
• Rapidly expanding sales volume
• Market and seasonal fluctuations
• Allowing too many accounts to become past-due receivables.
• Reliance on receivables concentrations (i.e., big customers) who pay late.
• Offering too many customers delayed payment programs.

Expense items:
• Gross margins are too low (you’re paying too much for inventory or not charging enough)
• Slow moving, obsolete inventory
• Net margins are too low (operating costs are perhaps out of control)
• A long lead-time between raw materials purchases and finished goods.
• Losing out on discounts with suppliers and vendors
• Employees are not operating near maximum productivity.
• Plant or offices are too large, causing waste of resources.

Cash and debt concerns:
• Inadequate cash reserves
• Lack of sufficient working capital line of credit
• Over reliance on short-term debt to fund cash flow
• Funding fixed with short-term debt or current assets with long-term debt.

A cash flow crisis can be devastating. Unfortunately, entrepreneurs who have never encountered these problems get “taken by surprise, even when the business seems to be going great. It is a sad fact that such as crisis can cause a business to fail very quickly, finding itself in bankruptcy.

MyCFO can help your client – consider referring us today!
Whether your client’s business is rolling along at full speed or barely managing to hang on, a “cash flow crunch” can prove devastating in a very short time. The professionals at MyCFO would be pleased to discuss how we can help your  client’s business in managing cash flow.  Contact us today for a free initial consultation!

Checklist of Cash Flow Crunch Warning Signs – CLIENTS

Don’t let your business fail!

Checklist of
“Cash Flow Crunch
Warning Signs”

Whether your business is rolling along at full speed or barely managing to hang on, a “cash flow crunch” can be devastating in a very short time.

What is a cash flow crunch?
Cash flow is the inflow and outflow of money from a business. It is necessary for your day-to-day operations, funding payroll, paying vendors, purchasing inventory and other operating costs.

Positive cash flow is when your business has more money coming in vs. going out; over the long-term, this is how value is created shareholders.

Negative cash flow is when more money is flowing out from the business in the form of accounts payable, debt and interest payments, payroll, rent and other expenses.

cash flow crunch occurs when a state of negative cash flow is substantial enough to impact operational functionality, either for a short or sustained period.

What are the warning signs?
Check out the “warning signs checklist” below and see if any of these traits are showing at your business:

Revenue issues:
• Low sales volume
• Rapidly expanding sales volume
• Market and seasonal fluctuations
• Allowing too many accounts to become past-due receivables.
• Reliance on receivables concentrations (i.e., big customers) who pay late.
• Offering too many customers delayed payment programs.

Expense items:
• Gross margins are too low (you’re paying too much for inventory or not charging enough)
• Slow moving, obsolete inventory
• Net margins are too low (operating costs are perhaps out of control)
• A long lead-time between raw materials purchases and finished goods.
• Losing out on discounts with suppliers and vendors
• Employees are not operating near maximum productivity.
• Plant or offices are too large, causing waste of resources.

Cash and debt concerns:
• Inadequate cash reserves
• Lack of sufficient working capital line of credit
• Over reliance on short-term debt to fund cash flow
• Funding fixed with short-term debt or current assets with long-term debt.

A cash flow crisis can be devastating. Unfortunately, entrepreneurs who have never encountered these problems get “taken by surprise, even when the business seems to be going great. It is a sad fact that such as crisis can cause a business to fail very quickly, finding itself in bankruptcy.

MyCFO can help your business!
Whether your business is rolling along at full speed or barely managing to hang on, a “cash flow crunch” can prove devastating in a very short time. The professionals at MyCFO would be pleased to discuss how we can help your business in managing cash flow.  Contact us today for a free initial consultation!