Legal Question in Wills and Trusts in Connecticut

Re: wills

I see as a problem the lack of estate planning!

When the second spouse dies, the estate will be hit with a great amount of tax. If the business is still viable, it might have to be sold very quickly to an outsider to pay the taxes.

Don't be fooled by reference to the QFOBE (Qualified Family Owned Business Exemption) -- it rarely applies and even when it does, it only gives a wee break on the time to pay the tax.

More importantly, with no will and no estate planning, you lose an opportunity to save somewhere between $280,000 and $340,000 (and going up) on estate taxes because a certain per-person lifetime credit towards estate taxes will have been wasted. With no planned giving, another hundred to two hundred thousand dollars of taxes can be wasted. If the business is valuable, there are many so-called "valuation discounts" available but only if done in advance.

Taxes are the major problem. However, there are other problems as well, such as creditor problems and privacy problems (which help avoid fraud charges).

There's more but I'm out of time ... please write to me at [email protected] and remind me to complete this message!

Who lives in Mass., anyone?

Re: wills

Your question isn't too clear. Are you the child of these folks? Is their business a corporation? If so, who owns the stock? Is there a trust which owns the rest of the couple's property? Further, if you are their child, since they live in Connecticut you will need to consult counsel there to find out what your rights are in that state. Typically, if one spouse dies intestate, that is without a will, the law provides distribution to the surviving spouse and children. You need to be a little more specific about your relationship with them and what your concerns are in order to get answers to your question.