Every person should have an estate plan, however medical professionals have additional needs and considerations. Several options are available to protect your assets and to ensure that the practice you spent years building benefits your heirs when you pass away. Learning the different ways to not only preserve your assets but protect them through estate planning can help you understand your rights and help you make the best choices as you create your estate plan.
Standard Estate Planning
Every person needs a solid and comprehensive estate plan in which retirement planning, tax planning, business planning, and estate planning work in unison. While medical professionals need a traditional estate plan, they have additional concerns and issues that others outside the medical community may not face.
Additionally, although doctors and dentists may be making a lot of income, they may not have a high net worth. Without a solid retirement plan, they may not be setting enough aside for retirement, or failing to strategically save in a way that would reduce their income tax liability. Estate planning for medical professionals can be a unique process in that there are certain advantages available, such as irrevocable trusts for minor children, that can help not only prepare for retirement but also ensure that your estate passes to your beneficiaries with minimal tax penalties.
As a medical practitioner, you are likely aware of the potential for medical malpractice lawsuits. There is a saying among medical professionals, “There are two kinds of doctors – those who have been sued, and those who will be sued.” Given our litigious society, it is important to create a plan that will protect the practice’s business assets.
There are two types of trusts that may assist in asset protection for medical professionals: domestic asset protection trusts and foreign asset protection trusts. Visiting with an estate planning attorney can help you understand how these types of trusts could be useful or advantageous to you financially.
The assets that your medical practice owns are likely considerable. Property, equipment, and receivables are just some of the assets of your business. Who will buy your interest in this property when you pass away? Who knows the true value of your business?
A buy-sell agreement is a tool that eliminates the complicated transaction of selling a business after a medical professional passes away. The agreement decides ahead of time who will buy the interest and the value of your business and eliminates the uncertainty regarding not only who will buy the business, but at what price. There are even options for you to pre-fund the buy-sell agreement with an insurance policy, which would ensure that funds are available to any beneficiaries, therefore avoiding any disruption in the course of your business.
Protecting your business interests and ensuring that your beneficiaries receive the benefit of your practice after you pass away can be done through a properly executed buy-sell agreement. Consider visiting with an experienced estate planning attorney to determine if this estate planning option is right for your business.
Contact an Estate Planning Attorney Today
If you are a medical professional, you have distinct and unique financial situations to examine as you create your estate plan. Contact the Law Office of Kris Mukherji at (858) 442-5747 to learn your best plan for ensuring that your beneficiaries receive the assets from your practice that took you years to build.
The Dangers of Using Online Contract Forms
Everything is available at the click of a button via the internet. This includes free contract forms
that are downloadable and can be used for various business transactions. These online contract
forms might seem like a convenient, cost-effective tool to meet your business’s needs. You have
probably heard the phrase “if it sounds too good to be true, it is probably not true.” When it
comes to online fillable business contract forms, this phrase is appropriate. Sure, it might be
convenient to use forms available at the click of a button, but these forms come with some
Using the Wrong Form
Even forms that are labeled might be misleading. Contract law is complicated and nuanced. The
name of the form might not be the legal consequence that the parties to the contract are seeking.
Names or titles that a layperson might think are interchangeable could have serious legal
consequences. An experienced business attorney can make sure that the appropriate contracts
being used and that they contain the correct language throughout.
Missing Crucial Terms
Many form contracts use what is known as boilerplate language. This is a language that is inserted
into every contract as a “one size fits all” situation. There may be language contained in these
boilerplate language contracts, or language missing, that can alter your intended meaning and
result of the contract.
Not Having All the Knowledge
Simply put, no one knows everything about any subject. When it comes to legal matters, it is best
to go with an experienced and trusted attorney who has undergone extensive training to be
licensed to practice law. When entering into any legal matter, you want to have the most
information possible. Simply put, you do not know what information you might be missing, and
that information might completely change the nature and effectiveness of your business contract.
Not Meeting Specific Needs
As stated above, many form contracts use boilerplate information that is not altered based on the
needs of the parties using the contract. Each situation is unique and might require additional
information or the parties to the contract might prefer that there be additional information or
terms included in the contract.
Specific State Laws
Every state might be different in their use, interpretation, and contract requirements. When using
a form contract, there is no guarantee that the contract is acceptable and valid in your state.
Should an issue arise between the parties of a contract, you do not want there to be issues
regarding the enforceability of said contract because it does not meet the requirements dictated
by the state.
At the end of the day, it is important to seek the advice of an experienced business law attorney
when you are putting together any business contract. The business attorneys at the Law Offices
of Kris Mukherji are here to help. We take the time to fully understand your goals with a contract
so that your needs are met. You would not trust a doctor to work on your car, so why would you
trust the internet for legal advice? Contact us today for a consultation.
Why Transferring Property Via Deed may not be a Good Idea
Deciding what to do with your property and assets after death can be quite difficult. Who do you
want to own your property? How does property get transferred? What is probate? Should I just
transfer ownership during my lifetime instead of waiting until after death? These are frequently
asked questions for individuals who are making their estate plans. For some, they think that
transferring ownership of the property during their lifetime is the way to go. They think that by
adding their children, grandchildren, or other intended beneficiary to the deed, they can avoid
any issues that might arise after their death. While on the surface this might seem like the best
option, transferring property to another individual before your death might result in unintended
and undesirable consequences.
The issues surrounding transferring property via deed to another person stem from the ownership
rights the other person would then have to your property. For example, an individual who owns a
home and wishes to leave it to a child after death might consider putting that child on the deed
now. The child who is included on the property’s deed is now a co-owner of the property. This
might not seem like an issue, but sharing ownership with someone is a risk in and of itself.
The following are issues that might arise when sharing ownership:
- Civil suits: If the co-owner of your property is sued, your property could be at risk. You
do not want to lose your home because someone else is being sued.
- Even if you are the co-owner of the property with your child, you do not know what someone
else is capable of. The co-owner might try to evict you or otherwise take away your
ability to live in your own home, even if you are currently living there. A California
couple in 2016 found themselves in this situation.
- Untimely death: If the co-owner passes away before the other individual, there is the
possibility of the other owner being subjected to paying taxes including capital gains
taxes due to not receiving a step-up in basis.
- Lines of Credit: The co-owner of the property can take out a mortgage or other equity
without your consent. Beyond just knowing what lines of credit are tied to your property,
if the co-owner falls behind in payments, then your property is in danger.
In order to avoid any issues with the co-ownership of property, you can pass along that property
through a trust or a will. An experienced estate attorney can help you determine the best way to
handle your property after death. The estate attorneys at the Law Offices of Kris Mukherji are
here to help you create an estate plan that works. We know that it can be confusing to determine
what to do with your assets and property after death. We want to eliminate this confusion and set
you up with an estate plan that addresses issues and gives you the peace of mind that your
property is taken care of following your death. Contact us today for a consultation.
You may have noticed that there are quite a few businesses in California that have the initials “LLC” at the end of their names. The Limited Liability Companies (LLCS) were likely established with the skilled guidance of a California business attorney. Limited liability companies represent just one of the business entity designations available to California businesses. The seasoned professionals at the Law Office of Kris Mukherji can help California business owners decide whether an LLC designation is the right choice for their business.
What is an LLC?
A limited liability company (LLC) is one of many business entity types available to businesses in California. Some LLCs have only one owner, while others have more than one. Like a partnership or a sole proprietorship, an LLC utilizes pass-through taxation. Pass-through taxation means that the profits and losses of the business are passed through to the owner, who then pays taxes on them. Owners do not have to pay taxes on the LLC’s income twice, once for themselves and once for the business. For this reason and others, the LLC is a popular designation for California businesses.
An LLC also has some features in common with a corporation. A corporation and an LLC both
have limited liability, which means that its owners are not personally financially responsible for the financial obligations of the company. If a judge orders a corporation or LLC to pay a certain amount as a legal settlement, the money can only come from the business itself. The law cannot require the owners to pay the settlement out of their personal assets.
Pros of the LLC Business Designation
- Flexibility of business structure: You can own the LLC by yourself or with partners.
- No double taxation
- Limited liability: If your LLC goes out of business, you will not be personally responsible for paying its outstanding debts. The same protection applies if someone sues
Cons of the LLC Business Designation
For many business owners, an LLC designation sounds like the best of both worlds — they can enjoy the pass-through taxation of a sole proprietorship and the liability protection of a
corporation. The biggest disadvantage to forming an LLC in California is that process of forming one can be complicated, and the requirements are strict. You will need an experienced California business lawyer to help you comply with all the requirements so that your LLC can operate legally and enjoy the highest levels of success.
Contact Kris Mukherji for Help Legally Establishing Your Business
The LLC designation is a popular business entity type, but it is not for everyone. Contact the Law Office of Kris Mukherji today for help choosing the best entity designation for your business.Read More
A recent poll suggests that an astonishing 56% of Americans do not have a will. While this figure is unsettling, it is important to recognize that individuals who have a last will and testament are not necessarily in the clear, either. Depending on the age of your will and who put the document together, there may be some issues that can potentially leave your loved ones in a bad situation after your passing. One of the best ways to ensure that your affairs are in order is to have an experienced California estate planning attorney help you establish a trust as part of your estate planning. Your assets will be held in the trust and they will be secured until your beneficiaries are eligible to receive their allotment of your assets.
A trust is a good way to add an extra level of protection to your assets. With a trust in place, your assets will not belong to the grantor of your will once the assets have been transferred over to the trust. With the help of a trust you can choose exactly who receives what assets and when those funds are distributed. This is a good way to ensure that the recipients of your assets are protected against frivolous spending or receiving funds before they are mature enough to be responsible for them.
Additional Benefits of Trusts
Trusts provide an element of control that little else can. They also provide certain levels of
privacy that would otherwise not be afforded to your estate after your death. A trust enables your heirs to enjoy certain tax breaks and the peace of mind of knowing that they will not need to go through probate upon your death. Depending on your specific set of circumstances, your California estate planning attorney can help you decide what trust is the best fit for you.
Common Forms of Trusts
- Revocable Trust: You retain control of your assets during your lifetime, and your estate can be distributed outside of probate. This type of trust can be dissolved at any time regardless of reasoning. Once you die, this trust will become irrevocable.
- Irrevocable Trust: The purpose of an irrevocable trust is that it cannot be altered once it has been executed. This potentially puts your assets outside the reach of probate and estate taxes. Once the trust is established, you no longer have control of your assets.
- Charitable Trust: This allows a certain portion of your assets to go to the charities of
- Marital Trust: This is designed to pass your assets to your spouse when you pass away
Do You Need Help?
There is a great value and peace of mind associated with establishing a trust. A properly drafted trust will allow you to avoid the probate process and have your wishes carried out seamlessly. Prior to establishing a trust, you should determine your goals and exactly what you would like your trust to achieve. When you are ready to establish your trust, contact the experienced and skilled attorneys at the Law Office of Kris Mukherji. We will guide through the estate planning process so that you can enjoy the peace of mind of knowing your loved ones will be provided for upon your passing.