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trust vs llc need Need advice with familiar situation?


WITAXLADY
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working on parents properties for 2 years now -

1) -first did a Will with Revocable Trust - Wisconsin with all the land to go into the trust upon death, house would also go in as land and property, Irrevocable Trust then for 50 years when youngest grandchild turns 50. Oldest sibling executor and also Trustee.

Assets to be divided per will equally amongst 6 siblings - cash, personal property

(Nursing home lookback not an issue as two sons own facility's for parents care**) Estate about $600,000 depending on how much they spend to live on - mostly in property

 

2) - Will contested before even passed away so next lawyer writes a Will and Revocable Trust to go on forever as law changes and generation skipping tax does not affect anymore??

Oldest is Executor and Trust is governed by all 6 siblings as a  committee - basically 5 boys against 1 girl (or 3 against 1 as other 2 not caring). 

Then this lawyer says lets do LLC's instead of a Trust-( due to MFL - Managed forest Land Law - must be in 3 different entities, regardless if a trust or LLC) and have 3 LLC's with 1 LLC over them all.

But aren't LLC's easier to overrule the wishes of the original landowners? Easier to break the entity and sell off the land or change to crops instead of recreational and no house building etc? 

 

3) - Nothing happening as no agreement, father now has dementia and mother is trying to keep the peace but insists on keeping the land together and not dividing to each sibling. 

So A - Trust vs LLC? 

B - Committee vs 1? 

C - Should not the property be Quit Claimed into the Rev Trust before she passes? And will this then avoid probate? 

 

4) - To add spice to all of this in 2011 under atty advice 4 of the properties were QC to the siblings and they would now have to QC it back into the Trust or LLC to keep it together as one big land reserve and 3 of 4 probably will. 

Do they QC it to the parents or directly to the Rev Trust? 

And one of the 6 received his or "took" it 30 years ago and is willing to "give" it back for $$$$ of paid property taxes to keep it intact. 

If any sibling did not give it back, he would lose his share of any of the Will portion about $50,000 vs $100,000 of land they all say they are never selling - cash in hand vs land value... 

 

And no, just splitting the land and not doing a land trust or LLC is not an option if it can be helped - she has decided this is her grandparents land and wants it kept together and financially it can work. Family wise with attitudes is another story. We are all still talking - praise God.

Plus how do you word it to at some point  - what the last one standing gets it all? or charity?  or if any family member wants out, he/ she  can leave and receive  -0- or $1,000?

Long story but maybe someone has again some insight - when dad was active - they saw 3-4 lawyers and now 3 more! One would not even charge for his advice but then again he said split it up and that is when mom finally said not what she wanted.  

Thx D

plus last week they said Sun my dad would be dead within the day from mersa and yesterday we talked about hospice and today we said he'd be around - with dementia another 2 or 3 years. And we are in the height/heat of tax season!!

 

 

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Egad!  First of all, this is way out of the league of anyone but a tax attorney (and a highly specialized one at that), so don't even try to render advice or get involved at all.  Just maybe what Mom should do is get a new attorney, tell him or her what she wants, and start all over again.  Or just maybe she should just rewrite her will leaving the whole thing to charity. All I really understand from your post is that there are way too many attorneys involved, each likely representing different children who each have way too many interests in mind (except their parents').

I hope your dad's journey is smooth.  Medical science has never been good at predicting at how long someone has left.  As you will come to see, that is largely up to him.  And while our own lives may seem to revolve around tax season, in the larger scheme of things it's just one tax season that succeeds others just like it and precedes many more.

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problem is it is my family and spent way too much time and $$ already  - latest one that has nothing settled  $$ are at $5,000 and who knows how much more, one prior was $2600 and they paid $3600 in 1004 for what I think is the current one as the brothers say they will contest the 2013! 

No atty likes keeping it  - they say split it.  and it is tax season again and we did decide today to not put dad into hospice - not ready for that until something happens as he just has dementia and could live 2-3 years yet....

Thx D

 

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On ‎1‎/‎21‎/‎2016 at 9:20 PM, SaraEA said:

First of all, this is way out of the league of anyone but a tax attorney (and a highly specialized one at that), so don't even try to render advice or get involved at all.  Just maybe what Mom should do is get a new attorney, tell him or her what she wants, and start all over again.  Or just maybe she should just rewrite her will leaving the whole thing to

 

13 hours ago, Catherine said:

I second what @SaraEA says -- you need an experienced tax attorney on this one.  

 

9 hours ago, WITAXLADY said:

problem is it is my family and spent way too much time and $$ already  - latest one that has nothing settled  $$ are at $5,000 and who knows how much more, one prior was $2600 and they paid $3600 in 1004 for what I think is the current one as the brothers say they will contest the 2013! 

No atty likes keeping it  - they say split it.  and it is tax season again and we did decide today to not put dad into hospice - not ready for that until something happens as he just has dementia and could live 2-3 years yet....

 

WITAXLADY,

Tax answer is answered by SaraEA and Catherine as quoted above. I do NOT have anything better ---- however you also asked for "advice with familiar situation", so ------  a few comments for your thoughts and consideration followed by personal experience with several families.

         When did a committee EVER make a decision that truly honored the "person's" wishes --- it all comes down to what the majority wants rather than the person -- otherwise there would not be a need for a committee  (YOUR mother and father want the land kept together -- the proper attorney will advise them and if they (mother and father choose to follow or not; that is there wishes) no need for committee).

         Somebody is going to "contest" the will regardless of how it might be written (unless it benefits them of course) Once probated or if done through trusts, let them spend their money, time and good will from others, along with lowering whatever they might receive --- it will not change them.  Especially if they want to "contest it before it is even placed in probate????? --- let them --- if they chose to not honor your parents --- that is there choice  --- they will have to live with the results (both from less inheritance and from family, etc.) --- . Your parents wishes are known to them, if they feel slighted, that is their problem.

         As far as a lot of money has been spent, that apparently is because --- someone ---- is not getting their way --- it is a shame that their positions are more important than your parents wishes, but ---- the wishes are more important ---- maybe, eventually those persons will realize that the money being "spent" to try to make peace and everybody "happy" is money that will not be there for their inheritance, etc.. Spend what is needed to make/keep your parents wishes. "Is it better to stop doing what should be done because all that has already been spent/given, when the outcome is NOT what was desired --- OR do you spend more to reach the initial goal (your parents wishes)?

 

         My own experiences with several families are that many "relations" were stressed, some even broken and that it all came down to those parties looking out for themselves instead of even trying to do what the parents wished.  Sad but there is no way everyone can be fully happy here ---- except if they think more of the parents than their own benefit. Some of the folks came back together - eventually --- some did not, but those probably would "NOT HAVE BOTHERED" anyway, sooner or later.

Do what you think will honor your parents  - regardless of outcome --- and let them choose ONE EXECUTOR who will follow their wishes regardless of the fuss, etc.. That is the executor's duty  -- not to worry if they are liked, etc. but to follow the wishes of the will maker according to law. The Tax Attorney just helps keep it all legal --- and remember ---- as an attorney is foolish if they representative themselves; so truly might the "tax professional" be foolish, if they enter into something like this as a policy or decision maker for their close family.

          The above is my opinion and thoughts ---- some say I am full of good information, some say I am just "full of"""  -- all is given with good intentions and hopefully helps you and others think properly.

    Sorry for your troubles, and hope your parents have an easy transition with their "partners" passing when God calls them.  (we feel sorrow and worry because they are not here with us;--; they feel happiness because they are with Jesus & God and have no more pain or worry). God Bless you and your parents.

 

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Easytax good points. It is sad but I have witnessed families of the deceased act as if their inheritance is a winning lottery ticket or  an entitlement. In my opinion whatever a beneficiary of the estate receives, it is a generous gift no matter what the amount. Turn the matter over to a Higher authority and accept the outcome. 

Recently I received the life insurance after my sons tragic death. I cried because the money is no consolation or substitute that can make me feel better. Cashing in a loved one is a terrible process. We learn a lot about ourselves when put to the test.

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I have also seen families torn apart contesting wills.  (One reason I recommend to all clients who have specific wishes to get a good attorney on board and do everything through trusts:   cannot be challenged after decease nearly as easily/successfully.)  

Any way you slice it, this is going to be hard on your folks and then/also hard on you.  All I can reiterate is get a good attorney NOT connected to the family on their side to fulfill THEIR wishes, and tell the whiners to go suck an egg.  (If you wish to add specifics such as a salmonella-infected egg, that is your prerogative.)  Like SFA mentioned, whatever is received is a gift that did not have to be given to them.  If they can't see it that way they need to be spanked.  With adults it is usually better to do that verbally (the ones who need it most would probably enjoy it given physically, so let's not go there).

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