- What is Mediation?
- What is Estate Planning Mediation?
- What is an Estate Plan?
- What happens at the first mediation session?
- Do mediators give us advice?
- What is estate tax or inheritance tax?
- How can I minimize or avoid probate proceedings?
- How do I save on estate and gift taxes?
- How can I provide for all family members when there has been a second or subsequent marriage?
- How can I arrange for the care of my minor children?
- How do I take care of my personal medical Issues?
What is Mediation?
Communicating with your family is often more difficult than communicating with a stranger. The mediation process will allow your family not only to collaboratively create an ideal estate plan, but also learn skills to talk with each other in an open and constructive manner.
During mediation, a mediator is there to facilitate the discussion, assist with communication, provide information and suggestions, and use specialized training to assist your family in resolving differences and create an estate plan that is in the best interest of every member of your family.
What is Estate Planning Mediation?
Estate planning through mediation is a sensible and cost-effective way to plan the transfer of your assets to your loved ones. You’ll use the same legal documents as in a typical estate plan, but you’ll have an opportunity to thoroughly consider and discuss your choices.
Since mediation is a flexible, client-driven process, you can include other family members or experts in this discussion process if you wish to do so. Mediation for estate planning goes beyond the traditional paperwork, creating a more thoughtful, more thoroughly considered estate plan.
In this new generation of blended families, step siblings, and multiple marriages, estate planning has become increasingly complicated. By creating an estate plan through mediation, you will be able to work together with your family to design an estate plan that will minimize the chance of future family conflict while accomplishing all of your financial goals.
Benefits of Estate Planning Mediation:
What is an Estate Plan?
An Estate Plan is a way for you to determine who will be the beneficiaries of your estate. It is also a way to choose the wisest legal transfer method to avoid unnecessary taxes for those who you want to leave it to. If your estate is worth more than the amount of the Federal Personal Estate Tax Exemption or the Federal Gift Tax for the year of your death, your estate will owe taxes unless other exemptions or deductions apply.
At Peace Talks, we can help you navigate through all the complicated laws to make and estate plan that meets your goals and minimize taxes.
What happens at the first mediation session?
Our first meeting is a free, half-hour mediation orientation so that you can meet the mediator(s) and decide if you’d like to try using mediation to create your estate plan. We’ll explain the process, and you can ask any questions that you wish. The mediation orientation is free of charge as long as we’re talking about the mediation process, and not the details of your particular case. We offer the mediation orientation because choosing a mediator that is right for your family is a very personal and very important decision.
We want to make sure you choose the right professional mediator and mediation office for your needs. If you’re almost certain you’d like to mediation to create your estate plan, you can schedule your first mediation appointment to follow the mediation orientation. If you’d prefer just to meet us and find out more about mediation, that’s fine too. There’s no obligation when you come in for a mediation orientation appointment.
The actual Mediation process involves sitting down at a table in a neutral location where all parties will have the opportunity to present their concerns and suggestions in a balanced and non-confrontational way. There are only two steadfast rules: (1) One person speaks at a time. (2) No name-calling.
Everything flows from there in an orderly and organized fashion. Each person gets a chance to voice their concerns, and the mediators will facilitate the discussion. Next, we make a list of the issues and decide which to discuss first. We work through each issue until there are no more issues left.
Sometimes, people find they need more information before they can make an agreement or before the session can continue. When that happens, we can either go on to another issue, or stop the session and make another appointment, so that you’ll have time to gather the information you need, or speak to your accountant, lawyer, or other advisor(s). Mediation works best when people don’t feel rushed to make an agreement and when they have all of the information they need to make a good agreement.
Do mediators give us advice?
Mediators don’t give advice but we do give you plenty of information so that you can make the best decision for you, and for your family. We also teach you how to communicate better, and we teach you what you need to know about the law, but we don’t tell you what’s best for you. That’s why mediation works so well–because you decide what’s best for you and your family.
We help you every step of the way, and sometimes we’ll make a suggestion for an option you haven’t thought of, but we won’t tell you what to do. If you feel you need advice, we can refer you to a lawyer or counselor or other qualified professional.
What is estate tax or inheritance tax?
Estate taxes or Inheritance taxes are taxes that are placed on your property as it passes from you to your survivors. The federal government exempts a set dollar amount. Taxes are imposed only on property that is in your name at the time of your death. Therefore, you may consider legally transferring the ownership of your property while you are living, to minimize the amount of such property you own when you pass away.
How can I minimize or avoid probate proceedings?
By mediating your estate plan Peace Talks, can help you create a plan that will avoid costly, time consuming probate proceedings.
Some Facts about Probate:
Probate is the court proceeding in which the authenticity of your will is established, your executor or administrator is appointed, your debts and taxes are paid, and your property in your probate estate is distributed according to your will.
The probate process can be costly and time consuming. Going through the probate process could require payment of attorney’s fees, executor fees, court costs, publishing fees, filing fees, and appraisal fees.
In California, an estate worth up to $100,000 is exempt from normal probate. However, for estates over $100,000, all property left by a will must go through probate.
There are several ways to reduce or eliminate probate fees by transferring property outside of probate. When you mediate at Peace Talks, we can help you choose which avenue is best to meet your goals.
Major Probate Avoidance methods:
Living Trusts:Property held in a living trust does not need to go through probate. A living trust has the power to do all the basic functions of a will with the huge plus of avoiding probate. Please see “Making a trust”
Joint Tenancy: This is a form of share property ownership. At the time of one owner’s death, the surviving joint owner or owners automatically inherit the deceased owner’s share. The property does not go through probate.
Pay-on-Death designations: This is an easy way to transfer monies in your bank account at your death without probate. The bank will provide you with a form where you designate one or more persons to receive any money in the account at the time of your death.
Life Insurance: Life insurance is a good way to provide quick cash for debts, living expenses, and estate taxes for surviving family members. Because beneficiaries are named in life insurance policies, the proceeds do not go through probate.
Individual retirement programs: Individual retirement programs allow you to name beneficiaries to receive any money left in the account at the time of your death. Therefore, the money goes directly to your beneficiaries and is not subject to probate.
How do I save on estate and gift taxes?
When you mediate at Peace Talks, we can help you create an estate plan that minimizes estate and gift taxes. There are several exceptions and exemptions that we will help you choose in order to minimize these taxes.
Exemptions of the Federal Estate Tax:
The Personal Exemption: If your estate is worth more than the amount of the personal estate tax exemption for the year of your death, your estate will owe taxes unless other exemptions or deductions apply.
Estate Tax Exemption
Highest estate and gift tax rate
|gift tax rate”>|
Estate Tax Repealed
Top individual income tax rate (gift tax only)
$1 million unless Congress extends repeal
55% unless Congress extends repeal
The Marital Deduction: All property left by a deceased spouse to a surviving spouse is exempt from tax.
The Charitable Deduction: All gifts left to a tax-exempt charitable organization are exempt from federal tax.
Things you can do to reduce federal estate taxes if you think your estate will be liable to them
Give Away Property While You Are Alive: Federal law allows you to give property worth $11,000 or less per person (or noncharitable institution) per year. A couple can give $22,000 a year tax free to one person.
Create an Estate Tax-Saving Trust: You can use a number of different types of to save on overall estate taxes, depending on your circumstances and desires.
Exemptions to the Federal Gift Tax:
The Annual Exemption: Federal law allows you to give property worth $11,000 or less per person (or noncharitable institution) per year. A couple can give $22,000 a year tax free to one person.
The Marital Exemption Gifts between spouses are exempt from gift tax. However, the marital deduction does not apply to gifts from a citizen spouse to a non-citizen spouse.
Gifts for Medical Bills or School Tuition:
The payment of another person’s medical bills or school tuition is gift tax exempt. However, if you give the money to the person directly to pay the medical bill or school tuition, and then the person subsequently pays the bill, the gift is not exempt. Payment of the bill must be made directly by you.
Federal Gift Tax:You can give away a total of $1million during your lifetime without paying gift taxes.The federal government imposes a tax on substantial gifts made during life. This tax is imposed on the giver of the gift, and not the recipient.
How can I provide for all family members when there has been a second or subsequent marriage?
When you mediate at Peace Talks, we will help you understand the special considerations that need to be taken for subsequent marriages and families.
At the time of your death, if you do not have an estate plan, intestate succession laws of California will determine who receives the proceeds of your estate.
Intestate succession laws are a fixed set of rules that distributes every estate in the same manner. They do not take into consideration unique family situations, history, or backgrounds.
Therefore, if you want control over which individuals will inherit your estate, it is essential to have an estate plan. Creating an estate plan through Peace Talks Mediation will allow you to act in the best interest of your unique family.
How can I arrange for the care of my minor children?
It is especially important with young children to make sure that they will be well provided for in the chance of an unforeseen event. Peace Talks Mediation allows you to make those vital decisions for the welfare of your child.
Every minor must be raised by an adult who is legally responsible for care of the child.
If there are no parents capable of handling this responsibility, a personal guardian will be appointed by the court. You can nominate someone to be your child’s personal guardian in a will. If you have young children, you must have a will to have your wishes be known.
Please see “Providing for Young Children”
How do I take care of my personal medical Issues?
Ensuring that your family members will have the proper guidance and instruction when you are no longer able to direct them is a gift to your family. At Peace Talks, we will help you to create a plan to ensure that your wishes will be known and followed through.
Through estate planning you can determine how your assets are to be managed for your benefit if you are unable to do so.
Determine the type of medical care you want to receive if you are unable to make your wishes known.
Determine funeral arrangements and how expenses are to be paid.
Please see “Planning for Incapacity”