Protect Your Family with a Living Trust and Guardianship

Every family right now is frightened by the magnitude of the coronavirus. They may be thinking about whether or not they should create a Living Trust. For those families with children under 18, an important part of our Trust package is the Will, where you can name a Guardian to care for your children if something should happen to you.

Naming a Guardian and a Creating a Will are parts of our Living Trust package

If both you and your spouse should die, your children will need a Guardian. If you do not leave instructions in the form of a Will, the court will not have any guidance from you, the parents of the children, and will therefore choose the Guardian. While it is painful to think of leaving your children, it can be reassuring to know that in the case of this unlikely eventuality, they will be properly cared for by someone you love and trust.

Using a Trust to control your children’s inheritance

Sometimes it’s not simply a matter of ensuring that your children inherit your estate after you are gone. You may want to guide and control that inheritance–especially if your children are still young. That’s where a Living Trust comes in.

A Living Trust can manage any assets the children receive if their parents die. If you’re worried about your children getting a large sum of money when they are too young to handle the responsibility, as might happen with a Will. You can identify the age at which they will gain control of the funds.

Rather than getting the entire amount at 18, for example, they would gain control of the money when they are older and better prepared to inherit a large sum of money. It’s reassuring to remember that most parents of young children live long enough to see their kids safely to adulthood. But sometimes the unexpected happens. Having a Will or Living Trust in place now can provide peace of mind about your children’s future.

During this health crisis, many are feeling an urgency to create a Living Trust 

Our Trust package includes a Will, Power of Attorney and an Advance Healthcare Directive. We guide you through the process and prepare the legal documents. At California Document Preparers, for most of our services, we charge one flat fee. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices in Dublin, Walnut Creek or Oakland. 

We service the entire East Bay and North Bay areas

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield.

AB-5 and LLCs: CDP Provides a Workaround for Independent Contractors

Jane Matthews built a successful business as a video and movie script writer while homeschooling her nine-year-old autistic daughter and shuttling her 15-year-old son to his accelerated science classes at the local college. Her husband’s sales job means that he travels frequently and is unavailable for day-to-day help with the family’s routine. The flexibility of Jane’s home-based business is what makes this all possible, and now she’s in the direct line of fire from AB-5.

Women may have the most to lose when it comes to AB-5

Women tend to be most in need of the flexible hours that draw them to independent contractor work. For those juggling caregiving and a heavy load of unpaid household work, running a business from home instead of commuting is often the only way they can get everything done. Job flexibility allows them to care for family while pursuing careers and generating an income.

The strategy behind AB-5 is that companies will hire their independent contractors

The new California labor law, AB-5, meant for companies to hire their independent contractors as full-time employees, is being met with heavy opposition. The bill’s sponsor, Assemblywoman Lorena Gonzalez (D-San Diego), tweeted that under the law “if you are a true independent proprietor, you can still operate as one.” Yet that’s not happening. California writers who bid on national projects are being blackballed.

What were they thinking?

While Governor Newsom was a proponent of the law for its efforts to address income inequality, and he signed it into law, we’re left wondering if they really thought this through. An estimated 37% of American workers are independent contractors. Newsom talked about creating collective bargaining and other ways to start raising worker wages. While wage inequity is bringing this country to its knees, putting people out of work cannot be the solution.

Many choose independent contractor status for the flexibility it affords

While many independent contractors would love to be hired as full-time employees to start accruing healthcare, retirement and vacation benefits, many others, like Jane Matthews, choose to be an independent contractor for the flexibility it affords. The list of professions that have traditionally and still are working independently is a long one. Some are familiar, others obscure. Many stand to lose their livelihoods. Think musicians, horse trainers, hair stylists, massage therapists, the people who give piano or ballet lessons to your kids. Churches and nonprofits. A wide range of consultants who are hired for a specific purpose, often for a specific time window. Many seniors who pick up part-time jobs to supplement their social security income will be hurt by this law.

One potential solution: Creating an LLC

CDP is assisting independent contractors in creating LLCs as a strategy to get around this bill. By forming a corporation, workers can retain their independent status—and potentially avoid losing work.

• LLCs have become popular because they have fewer formalitiesthan other corporate structures, yet they still provide liability protection.
• Forming an LLC is straightforward. In California,the filing fee to form an LLC is $75, which is included in our fee.
• An LLC includes an annual$800 franchise tax, and you also will need to get a business license.

Do you have questions about forming a corporation? Contact us today for more information or to schedule an appointment. 

Lawmakers promise changes to address worker concerns

California Assemblywoman Lorena Gonzalez continues to defend AB-5, insisting that its intention is to protect those workers who need it the most. Now just a few months into the new year, the law continues to be challenged. Freelance journalists, Uber, Lyft and truckers, among other groups, are involved in litigation.

California Document Preparers is a local Legal Document Assistant firm and we have assisted with organizing small businesses’ LLCs since 2004. We would be pleased to be of assistance.

We charge $599 for our LLC services, which includes:

• Articles of Organization filing
• Operating Agreement
• Statement of Information
• EIN Assistance
• Company Kit

We guide our clients through the Business Formation process and prepare the legal documents. We prepare and file the Articles of Incorporation with the Secretary of State. An LLC can be one or many members—making it ideal for independent contractors. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices.

It’s Tax Season: Be on the Lookout for Tax Scammers

I just read about a taxpayer (in this case, we’re using the term loosely), whom we’ll call Victor. He has a good job, has raised three kids and put them all through college. He saves for retirement. His taxes are regularly withheld from his paycheck, so there are probably no big tax debts from which he is hiding. But he has not been current with the IRS for 30 years.

I do intend to file.” Yet it never quite happens

“I’ve often thought about why I do this,” he said. “I have theories, but none has helped me get past the fear of filing and doing it on time. I rationalize. I think I’m just a small guy and the IRS wouldn’t be interested in me.

Unlike Victor, most of us do file our annual taxes, but it’s generally with some trepidation

For the 37% of American workers who are employed as independent contractors, there is the uneasiness of wondering if they’ve claimed enough in their quarterly filings. No one wants a big surprise during tax season.

But there’s a bigger, more insidious surprise waiting for many unsuspecting taxpayers

The IRS calls them “ghosts”. They’re shady operators that the Internal Revenue Service (IRS) calls “ghosts”. Those who are certified to prepare tax returns for other people have a legally required 2019 Preparer Tax Identification Number (PTIN). Ghosts don’t have a PTIN and don’t sign the returns they work on, leaving their clients holding the bag for any filing falsehoods.

These ghosts are brazen, setting up shop in pop-up offices

• Ghosts set up shop around tax time in pop-up offices in malls. They pitch their services at community-gathering places such as churches or clubhouses.
• They lure customers with promises of big refunds, often predicating their fees on a percentage of the refund. Real tax preparers base their fees on their time, generally an agreed-upon rate per hour.
• They might invent income to falsely claim tax credits or fabricate deductions for business, education or medical expenses.

By the time the IRS catches on, the ghost will have vanished—with your fee

It’s your name on the return, and you’re liable. It may take some time for the IRS to catch up with you and your missing taxes. In the meantime, you will be accruing penalties and interest.

Some ghost preparers take the scam a step further, stealing refunds outright by routing them into their own bank accounts. Other tax prep fraudsters work online, sending phishing emails that appear to be from tax pros, or creating impostor websites that claim to prepare and e-file your return.

The Federal Trade Commission (FTC) warns:

“These websites looks legitimate,” but “they’re set up to collect personal information that can be used to commit fraud,” including identity theft.

Here are some red flags. Be very suspicious if your tax preparer:

• Asks for payment in cash.
• Has an excuse why you won’t receive a receipt.
• Bases fees on a percentage of the refund. Tax preparers base their fees on their time.
• Wants the refund deposited in his or her bank account. Ridiculous.
• Marks your return as “self-prepared” or affixes a business label rather than signing the form by name. A certified preparer will have a PTIN.

One more thing: IRS robocalls

Who hasn’t received an intimidating phone call that starts with “This is the IRS”. Hang up and report it—this is a robocall. Never return a phone call from someone claiming to be the IRS. The IRS never discusses personal tax issues through unsolicited emails, texts or over social media.

We look forward to assisting our clients with their uncontested legal matters

Taxes and Living Trusts are important parts of estate planning. Our Living Trust package includes a Power of Attorney and an Advance Healthcare Directive. We guide our clients through the process. We prepare the legal documents and file them with the courts. For most of our services, we charge one flat fee. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices.

Celebrating the Small, Happy Life

I recently came across David Brooks’s column in The New York Times asking his readers to define their purpose in life. While many were overachievers with lofty themes about changing the world, others found fulfillment in simply living and creating small, happy lives.

I have always wanted to be kind

One story comes from a man whose most precious possession was a banged-up tin pot that he kept carefully wrapped in cloth as though it were fragile. The message? We do not all have to shine. We don’t all have to be doing something big and important. Another response: “I have always wanted to be effortlessly kind. I wanted to raise children who were kind.”

A response from someone who survived the Nazi death camps notes that a predominant quality of these survivors was generosity. Everywhere there are tiny, inconsequential opportunities to be generous and kind.

Another woman writes: “I used to be one of the solid ones”

“Now my purpose is simply to be the person who can pick up the phone and give you 30 minutes in your time of crisis. I can edit your letter. I can listen to you complain about your co-worker. I can look you in the eye and give you a few dollars in the parking lot. I am not upset if you cry.” Think about it. Just being there for someone. In a time when we have to go to our calendars to simply schedule a telephone call, this is really quite a lot.

One gentleman has always admired the fiercely successfully people who make things happen, but he’s chosen to live his life on a much smaller scale and found happiness. “I have a terrific wife, five kids, friends from grade school and high school, college, army, friends locally, and sometimes, best of all, horses, dogs and cats. Finally, I have a small industrial business that I started and have run for 40 years.”

An 85-year old chronicles his life by the seasons in his garden

“I am thankful to be alive. I have a responsibility to myself and those around me to give meaning to my life from day to day. I enjoy my family (not all of them) and a shrinking number of old friends. If there is one thing that keeps me focused, it’s the garden. Lots of plants died during the harsh winter, but, amazingly, the clematises and the roses are back, and lettuce, spinach and tomatoes are thriving in the greenhouse. The weeping cherry tree in front of the house succumbed to old age. I still have to plant a new tree this year. There is something beautiful, concrete and well-proportioned about tending that garden.”

For this older gentleman, the garden becomes a metaphor for the seasons of his life.

We look forward to assisting our clients with their uncontested legal matters

As we embrace another year, we look forward to assisting our clients with their uncontested legal matters. Whether it’s a Divorce, Living Trust, Probate or Business Formation, we guide our clients through the process. We prepare the legal documents and file them with the courts. For most of our services, we charge one flat fee. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices.

Lynda Faye had always looked forward to retirement. Time for gardening and her backyard art studio in Amherst, MA. She wanted to spend time with her grandchildren. To catch up on her reading, to slow down and enjoy life at a slower pace. One thing she never put on her bucket list was caring for an elderly parent.

Faye is 75, and that frail elderly parent is her mother, 99

Yetta Meisel just turned 99. Faye now helps care for her mother, including preparing her meals. She picks up her meds, schedules home aides and transports a wheelchair for excursions. “We never expected her to live this long. She was never particularly healthy, but besides difficulty walking and some cognitive impairment, she is doing better than anyone could have ever expected! Our whole family makes an effort to spend time with her—even if it’s just an hour or so to check in and see how she’s feeling.”

Faye and her mother are part of a growing phenomenon: Seniors spending their retirement years caring for parents who are in their 90s and beyond. Because of longer life spans, many adult children and their parents are now “aging together,” said Kathrin Boerner, an associate professor of gerontology at the University of Massachusetts Boston.

Faye has abandoned her own retirement dreams

Her mother’s longevity has taken a financial toll. Faye has dipped into her nest egg to pay for her mother’s expenses. She put her home with her fabulous garden and art studio on the market. She cares for her mother three days each week and pays for part of her mother’s care out of her own pension. As difficult as her responsibilities are, she considers herself lucky to have a mother with a good sense of humor who appreciates her efforts.

Study finds these senior caregivers suffering from failing health, stress and isolation

Dr. Boerner found that many of these late-life caregivers, typically daughters, suffer from their own failing health, which worsens with the stress, depression, physical tasks and isolation. The financial picture often becomes dire. The adult children spend resources meant for their own later lives. It gets worse when there were toxic relationships between parent and child. Old resentments bubble up, and the quality of caregiving suffers.

Getting exercise and taking much-needed personal time could depend on the family’s ability to pay for home aides, adult daycare and other respite programs.

There are resources that may provide help: 

• Medicaid picks up some costs for those with limited assets, but the number of hours varies.
• An accountant will calculate tax breaks for home care and other services.
• Local senior programs may offer guidance on free and reduced-cost programs.

But children who are draining their own retirement savings should consider a nursing home that accepts Medicaid, and then pay for restaurant outings and other extras.

Even when they do not pay for care, many older caregivers make financial sacrifices. In some cases, children, particularly women, are retiring earlier than they planned or are cutting back on their hours to care for their parents.

The growing problem of caring for our seniors

Most of us these days know someone who is caring for an aging family member. With 10,000 baby boomers turning 70 every day, caring for this demographic is a growing health care issue. It’s only a matter of time before it becomes a political issue.

The need to prepare life-planning documents

If you or someone you know is caring for someone or are part of a caregiver team, it’s important to create a Living Trust. Our comprehensive Trust portfolio includes a Power of Attorney and an Advance Healthcare Directive. It’s important to sign these legal documents while someone still has testamentary capacity. With a Power of Attorney and Advance Healthcare Directive, you or a member of your team will be able to make important healthcare and financial decisions in the event your family member becomes incapacitated.

Our dedicated team has assisted hundreds of families in creating their Living Trusts

We’re responsive and available throughout the process. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices.

AB-5 Signed into Law: But What Happens Next?

California’s Assembly Bill 5 (AB-5) took effect on January 1, 2020. The bill is an effort to curtail the hiring of independent contractors that leaves many workers without the stability that comes with employee status—healthcare benefits, a retirement account and accrued vacation time.

AB-5 is an effort to force companies to hire their contractors as employees with benefits

Assembly Bill 5 is designed to cut down on the number of contractors in the workforce, known as the gig economy. The gig economy is based on short-term engagements, temporary contracts and independent contracting. A total of 36% of workers, or 57 million Americans, now work in the gig economy, which means they’re missing out on employee benefits.

The law implements a California Supreme Court decision that imposes a three-pronged test to identify those workers who are still free to be contract workers and those who must be a hired as employees.

• A worker can be an independent contractor only if he or she is free from the control and direction of the hirer
• A worker must perform work that falls outside the usual course of the hiring entity’s business.

Under the requirement, janitors could work as independent contractors only when they have contracts with companies not in the business of cleaning. Companies that outsource their cleaning or janitorial services would be exempt from the law. Or a rideshare driver could work under a contract with Uber or Lyft only if those companies were primarily in the business of, say, selling vacuum cleaners.

It’s a rigid framework, says labor law firm Fisher Phillips, that will appear, in “the nightmares of your average gig economy business executives.”

Contractors are starting the New Year with a lot of uncertainty

Many contractors and freelancers choose to work as contractors for a wide range of reasons. Says one Uber-driving mom, “I have to pick my kids up or drop them off. I do that and come back to work, which is driving. What shift or employer is going to let me do that other than this?”

Creating pathways to form (stronger) unions

Yet Gov. Newsom’s next step “is creating pathways for more workers to form a union, collectively bargain to earn more, and have a stronger voice at work.” Newsom’s plan includes persuading political, labor, and business leaders to support an effort in which “workers excluded from the National Labor Relations Act” would have “the right to organize and collectively bargain.”

Unions have done a lot that is right

A lot of courageous people struggled and died so that we could have a 40-hour work week, safe working conditions and benefits. We’ve watched as those benefits have continued to dwindle.

Yet AB-5 may hurt many part-time workers

• Seniors who may be picking up contract jobs to supplement their social security incomes.
• Churches with declining congregations that can’t afford full-time staff.
• Seasonal businesses and others who rely on part-time workers in the off-season.

Opponents believe that AB-5 will rob workers of the freedom and flexibility they want and often need from freelance work. For thousands of workers, freelancing work is attractive for its flexibility. Workers may have a spouse or partner with a full-time job, and they’re the ones who need the flex time to care for the kids while continuing to have careers.

Independent contractors may not feel exploited

According to The Los Angeles Times columnist George Skelton, “there are tens of thousands of independent contractors who apparently don’t feel the slightest bit exploited. And they don’t want anything to do with formal employment or unions.” On the other hand, many employees who wish they had protections such as unemployment insurance and overtime pay may appreciate the new protections.

There are some exemptions from AB-5

Prior to its passage, AB-5 was the subject of major lobbying efforts on both sides of the issue. The result is that more than 50 professions or types of businesses are exempt from the bill. Exemptions include doctors, dentists, insurance agents, lawyers, real estate agents, hairstylists, and a variety of creative professionals.

AB5 also exempts business-to-business contractors who meet 12 specific requirements and referral agencies that meet ten specific requirements.

The “exemptions” and their consequences

The bill will make it illegal for contractors who reside in California to create more than 35 pieces of content in a year for a single company, unless the outlet hires them as employees. A nonprofit legal foundation is suing California on behalf of freelance workers who say that AB-5 will destroy their livelihoods. Thousands of California female freelancer writers, single moms and minorities stand to lose their livelihoods due to this bill,” said one freelance writer. “I was told by a client that because I live in California they can’t use me.” They’re blackballing California writers. For those who are competing for national writing gigs, AB-5 is a direct threat to their income.

What’s next for AB-5?

We can likely expect to see some lengthy legal battles over enforcement. AB-5 enables the California attorney general, city attorneys and local prosecutors to sue companies over violations. Large companies with deep pockets (Uber and Lyft, where this whole thing started) would likely fight their cases for years.  There’s a lot at stake when people’s jobs are on the line. Expect years of lobbying efforts for industry-related exemptions at the legislative level.

Living Trusts are an important parts of estate planning

When it comes to financial planning, a Living Trust is an important part of the process. Our Trust package includes a Power of Attorney and Advance Healthcare Directive. Our dedicated team has assisted hundreds of families in creating and updating their Trusts. We’re responsive and available throughout the process. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices.

Remember the Peace Corps? Look for a Peace Corps Of Caregivers

Who remembers the Peace Corps? It was a government program, a way for mostly young volunteers to help others while expanding their own world views that goes back to the Kennedy administration. Volunteers served two years in foreign countries. But no one was assigned to Paris or London; rather, they went to developing countries they’d never heard of—Djibouti, Nicaragua or Niger.

The Peace Corps was a successful program

Those I knew who participated in the Peace Corps learned so much from this experience. One colleague helped build irrigation systems in rural Guatemala. He knew nothing about irrigation when he graduated from college. He’d lived a pretty pampered life, and being thrown into this situation was startling for him. He was suddenly the project manager with absolutely no idea what to do. Yet he rolled up his sleeves and got to work. The experience was a difference-maker in his life. He developed self-reliance and problem-solving skills that he’d never had before. He fell in love with Guatemala and its warm, generous people. The experience shaped his career and his life.

Using the Peace Corps model to help seniors age in place

So what would happen if we used that model and created a national program that mobilized volunteers to help seniors age in place? One is on the way.

Look for the emergence of the National Volunteer Care Corps

The Administration for Community Living, part of the Department of Health and Human Services, is taking steps to establish a National Volunteer Care Corps.

If this program is successful, healthy retirees and young adults would check in on seniors, take them to appointments, shop for groceries, shovel sidewalks, or just come for a visit to relieve them from isolation. They would be giving family caregivers a much-needed break. Younger volunteers might get class credit at a community college or small stipends. Older volunteers could enjoy a satisfying sense of purpose.

The need is immediate and growing

The need is dramatic and growing as the ranks of the oldest Americans ― those age 85 and up, who tend to have multiple chronic illnesses and difficulty performing daily tasks ― are set to swell to 14.6M in 2040, up from more than 6M now.

Who will care for these seniors?

• More than 34M unpaid family caregivers currently shoulder that responsibility, along with 3.3M paid personal care and home health aides.
• Remember that most of these family caregivers are stretched thin, working full time, caring for their kids as they care for their parents or other elderly family members.
• Filling those jobs is difficult due to low pay, difficult work conditions, limited opportunities for professional advancement and high turnover.

Four organizations will spearhead the Care Corps project

Oasis Institute, which runs the nation’s largest volunteer intergenerational tutoring program; the Caregiver Action Network; the National Association of Area Agencies on Aging; and the Altarum Institute, which works to improve care for vulnerable older adults.

The initial grant is $3.8M; total funding for the five-year project is expected to be $19M.

It starts with small grants to develop innovative programs

Up to 30 organizations will get 18-month grants of $30,000 to $250,000. The goal is to discover innovative, effective programs that offer services to diverse communities. “We’re aiming to create a volunteer infrastructure that can last and be sustainable.”

• All volunteers will undergo background checks and training, with an emphasis on evaluating program results.
• Services could include preparing meals, taking seniors to church or home-based tech support for computer users, among many other possibilities.

Care Corps faces big challenges

The grant is tiny, compared with the trillions of dollars spent on health care.

• It could take a long time to build it into a national effort that attracts more investment.
• Recruiting volunteers could be another challenge. This is the biggest issue we face,” said executive director Elaine Whitford. “We get a lot of interest,” Whitford said, “then people realize that this just isn’t going to fit into their schedules.”

Small amounts of volunteer caregiving can make big differences in people’s lives

“Volunteer caregiving can make the difference between someone having quality of life and not having any at all,” said Inez Russell, board chair of the organization. She’s also the founder of Friends for Life, a Texas program that offers volunteer aid to seniors trying to live independently and that reaches out to seniors who don’t have family members on birthdays and holidays, among other services. Altogether, the two programs reach about 4,000 people a year.

Another creative way to stay connected and create community: A time bank

In Montpelier, VT, Joan Black, who’s 88 and lives alone in a one-bedroom apartment, has been a member of a time bank for ten years. Members contribute goods and services (a ride to the airport, a homemade casserole, a newly knit baby sweater) to the time bank and receive goods and services in exchange. Black gives out information about the program at farmers markets and other community events–her way of banking credits.

An important part of the life-planning process is creating a Living Trust

Our comprehensive Trust portfolio includes a Power of Attorney and an Advance Healthcare Directive. It’s important to sign these documents while someone still has testamentary capacity. With a Power of Attorney and Advance Healthcare Directive, you or a member of your team will be able to make important healthcare and financial decisions in the event your family member becomes incapacitated.

Our dedicated team has assisted hundreds of families in creating their Living Trusts. We guide our clients through the process. We’re helpful, compassionate and affordable. Schedule an appointment today at one of our three Bay Area offices.