LGBT Estate Planning

Maryland Lesbian, Gay, Bisexual
& Transgender Estate Planning

500 E Pratt St, Suite 900, Baltimore, MD 21202-3133 • 410.332.8626 • info@mdlgbtestateplanning.com

As an estate-planning tool, the revocable living trust is oversold, overused, and overrated. It may also be exactly what you need.

The primary benefit is avoiding probate. Also called estate administration, the probate process can take nine months or more before your loved ones receive their inheritance. Having a living trust will enable them to receive their inheritance without delay upon your death.

The trust is established in your lifetime and then, when the time comes, functions as a substitute for your will. Setting up the trust means having to retitle each of your assets in the name of the trust. Brokerages, bank accounts, and real estate all must be transferred into the trust. The process can be involved, and in the case of real estate, it means having to prepare and record new deeds.

Still, this kind of trust is a popular estate-planning tool. Some professional advisers have gone so far as to recommend that everyone have a living trust. But the trusts can be expensive and cumbersome to set up. And unless they are properly maintained, they can actually complicate your estate after you’re gone.

When newspapers reported about the demise of Mark Twain, the American author and humorist quipped that “rumors of my death have been greatly exaggerated.” More than a century later, the same could be said of the federal estate tax, which is effectively defunct for all but the richest Americans.

Under the tax bill signed into law on December 22, 2017, individuals can leave behind more than $11.2 million in wealth without triggering the tax. For them, the “death tax” is dead, at least until the law sunsets in 2026. But even for those of us who aren’t exactly rich, other death taxes may still be due once we are out of the picture. Careful planning can keep them to a minimum.

What did Heath Ledger, Princess Diana, and the singer Prince all have in common? Each of them died with a botched estate plan—or none at all—and they cost their families a fortune in money and grief as a result.

The shock of Heath Ledger’s death from a drug overdose in 2008 was compounded by the discovery that his will left nothing to his only child, Matilda. Heath had prepared his will before Matilda was born, and the Australian actor never updated the document to provide for her.

The implications were heartbreaking. Heath’s father would inherit the entire $16 million estate, but Matilda, who was only 2 at the time, would receive nothing. Then, in a surprising turn of events, Heath’s father decided to give the full estate to Matilda, ensuring that his granddaughter would be well provided for. Heath’s father had no obligation to do this. By updating his will when Matilda was born, Heath could have prevented the uncertainty and legal costs his oversight caused.

In the Victorian era, death was almost fashionable. Funerals were well-attended social events and even rivaled weddings in their splendor and expense. Department stores offered an array of luxury clothing for grieving mothers and widows. Black fabrics were reserved for those in deep mourning. Then shades of gray and mauve were mixed in as one felt able to rejoin society. If death wasn’t celebrated, it was at least taken very seriously.

But then our Victorian cousins were closer to death than we are today. The average person didn’t live to see his 50th birthday, and more than three-quarters of all deaths occurred in children under the age of 5.

Today, people are living longer than ever, and as a consequence, death is considerably less in vogue. Improvements in medical care, diet, and occupational safety have prolonged life, but they have done little to combat the new threats to our existence. The perils of hurricanes, wild fires, and other natural disasters, and the terrors of shootings and random acts of violence, can be sufficient cause to worry about what the future holds.

In times like these, peace of mind comes from taking care to anticipate the things you can. Being prepared for the unexpected means setting aside money for an emergency, having health and life insurance, and even planning for your own disability or death.