When preparing an estate plan (Will, Trust, etc.), life insurance becomes a central component of that planning in many instances. This holds true in various scenarios. For individuals or families with somewhat modest assets, life insurance could provide the necessary resources to fully fund a trust that is being set up for young (or not so young) children. Especially for those with limited savings, this can be a key part of their estate plan. For some “high net worth” individuals or families, life insurance may be used to provide liquid cash to help pay estate taxes that would due upon their death. In any case, life insurance alone does not constitute a thorough estate plan. However, it very often does, when paired with estate planning tools such as a Will or Trust, become an integral part of that plan.
Anyone starting a business is confronted with the question of “how” exactly to set up that business. What is a corporation and what’s the benefit? What about an LLC? Why do I need any sort of special business “entity” at all? Determining what type of business entity (LLC, LLP, corporation, etc.) is a multi-faceted determination that is best made in consultation with an attorney. However, understanding the basic value and characteristics of these types of entities is important at any stage of business. Here, we will focus on the “limited liability company” or “LLC.” By creating an LLC, the owner(s) of a business creates a separate legal entity to own/operate the business. The owner(s) would then own membership interests in the LLC (similar to share of stock in a corporation). The three primary benefits of utilizing an LLC are (i) protection from personal liability from creditors (ii) avoidance of double-taxation present with some types of corporations and (iii) a significant amount of flexibility in how the company is set up, coupled with minimal ongoing administrative requirements. For many businesses, an LLC offers the most benefit and is the best fit. However, each situation, business and owner is different, so decisions relating to business creation and structure will vary for each business and owner.
A properly prepared and implemented power of attorney should consider and reduce potential risks to the individual and their family. Of course, appointing the “right” person as an agent is key. Characteristics such as trustworthiness, honesty, aptitude, experience and loyalty are important to consider. However, the manner in which a power of attorney document is prepared can also significantly reduce potential risks. For example, it may be wise to exclude certain more “sensitive” powers from a power of attorney (such as the ability to revise estate planning or beneficiary designations). Additional precautionary steps can be taken by naming co-agents or requiring notice to a second individual. A non-immediate “springing” power of attorney also affords some risk reduction.