Personal Finance: Ask the Experts

Get advice on money matters from The Bee's Claudia Buck and a panel of local experts

October 30, 2012
Have I made a gift to my great-grandchildren too difficult?

Q: I think that I made a mistake on my second amendment to declaration of living trust. I wrote that both my antique vehicle & car would be sold & the proceeds shall be divided equally among my then living great-grandchildren & be held in trust until each attains age 25. I am 84, have 9 great-grandchildren at this time. Ages 14, 11, 5, 4, 3, 2, 2, 6 months, and 6 months. I feel that with the small amount of funds, the work involved would not be worth it. Do you have any suggestions? Many thanks! --Bill, Elk Grove, CA

A: One of the advantages to having a revocable living trust is that you can amend it any time during your life, in case you change your mind or your circumstances change. I don't know how valuable your antique car is, but setting up nine trusts to split the proceeds nine ways seems like too much work to me too.

You could change the trust to say that the funds are held by a custodian for each great-grandchild in a CUTMA account using the CA Uniform Transfers to Minors Act. You would need to designate the Custodian you want to serve, and state that the funds for each beneficiary are to be held until the beneficiary attains age 25.

Another idea is to sell the car at some point when you're ready, pay any capital gains tax on the sale, and then spend each great-grandchild's one-ninth share of the proceeds on them. This approach allows you to enjoy giving the gift to them while you are living. Then it's not in your estate at the time of your death, so the amendment becomes moot, plus you had the pleasure of making the gifts in person.

If you would like to simply un-do this gift and have your successor trustee include the antique car with the rest of your assets in your trust to your remainder beneficiaries, it may be that you could revoke the second amendment to your trust; but you need to be very careful about this and should only do it after consulting with your estate planning attorney. Your attorney will be able to help you determine how you want your assets distributed, and the best way to accomplish that.

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Meet Our Financial Experts

Claudia Buck

Claudia Buck is The Sacramento Bee's personal finance columnist. Read all her columns here. Contact her at cbuck@sacbee.com

Terri Carpenter

Terri Carpenter offers advice on job hunting, retraining and career counseling. Carpenter works at Sacramento Works Inc., the career and job training arm of the Sacramento Employment and Training Agency (SETA). With 15 years in the field, she has hands-on experience with everyone from first-time job seekers to career professionals seeking advice after a layoff or looking for a mid-career change. Ask her a question.

Carlena Tapella

Carlena Tapella is a partner in the law firm of Webb & Tapella Law Corp. in Sacramento. The firm specializes in estate planning and probate, such as estates, trusts, conservatorships and litigation. She is a past president of the Sacramento County Bar Association's Estate Planning & Probate Section. Ask her a question.

Kimberly Foss

Kimberly Foss, certified financial planner, is the founder of Empyrion Wealth Management in Roseville. With nearly 30 years in the financial industry, her clients include women in transition, small business owners, retirees and "pre-retirees." Ask her a question.

Jesse Weller

Gregory Burke, a CPA and tax expert with John Waddell & Co. in Sacramento since 1984, worked as an IRS tax auditor for six years. He’s a past chairman of the California Society of CPAs. Ask him a question.

Daniel Tahara

Daniel Tahara takes your questions about California taxes. Tahara, a spokesman for the state Franchise Tax Board, has 10 years of experience as a tax auditor. Ask him a question.



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