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Like most people, in the private sector or in the food industry, you would probably describe yourself as middle class, even if you secretly know you are a cut or two above the herd. Maybe several notches to be honest! Most federal workers have college degrees. Most Americans don’t. While this doesn’t automatically mean anything, it is something to consider when assessing your cash value.
And the point is, you might be right! You can be one of the leaders of the pack.
After all, the days when government was just an army of poorly paid employees – if it ever existed – are long gone.
The average government white collar (GS) salary was $ 20,510 in 2020. By far the most populous civil service rank is GS-12. This includes 301,906. In the Washington-Baltimore metropolitan area, this pays $ 87,198 to $ 113,362. GS-1, the lowest paid government rank, has 793 employees with DC salaries ranging from $ 25,754 to $ 32,216. If there are any in the DC area.
With a good salary, maybe a house, insurance, a retirement plan, and a savings plan, many Feds are better off than they thought. And they may need to readjust their thinking on things like if I have an area and if so, what’s the plan. Download a will from the Internet and forget about it. Or do nothing and let the courts – possibly – decide. In the meantime, your surviving spouse and kids may be at each other’s throats because they know what you really want! So we asked DC area lawyer Tom O’Rourke to join us today on our radio show Your Turn. It’s 10:00 a.m. EDT streaming at FederalNewsNetwork.com or 1500 AM in the DC zone. If you miss the show, it will be archived on our home page. And if you have a question for Tom, an estate and tax specialist and former IRS employee, send it to me before showtime: [email protected]
To get you up to speed on today’s show and what a “domain” means, Tom has written this intro. Check it out and listen if you can:
“A revocable trust is a tool used in many estate plans. It is sometimes referred to as a living trust or revocable living trust. All of these terms refer to a trust that takes effect during the lifetime of the person who establishes it, and which can be revoked or changed at any time as long as the creator of the trust is alive and competent.
Trusts are often seen as tools for the wealthy, but are frequently used by people with smaller assets. All trusts are vehicles for the management and distribution of property or assets. A trust can be used to achieve any legally permitted purpose.
All trusts have three parts:
- The settlor (also sometimes referred to as settlor or trustee) is the person who establishes the trust and specifies how the assets of the trust are to be held, managed and distributed.
- The trustee is the person or entity who manages the assets held in the trust.
- The beneficiary (ies) is / are the person (s) for whom the trust assets are managed.
As is generally used, an individual establishes a trust during their lifetime. This person is the settlor, the trustee and the beneficiary during his lifetime. After the settlor’s death, a successor trustee is appointed and is instructed on how to manage and distribute the trust property. Often, a trustee is responsible for distributing the property among the beneficiaries. However, the trust may continue to exist and be managed for the benefit of one or more beneficiaries.
A revocable trust has two advantages over a will. It can be used as a means of managing the settlor’s assets in the event of his incapacity. It can also avoid approval following the death of the grantor. These goals can only be achieved if the trust is funded. The assets must be titled in the name of the trust. Establishing a trust, but not funding it, is a waste of time and money.
While establishing a revocable trust can be a most useful tool, it cannot achieve certain goals:
- It does not reduce your income or your inheritance tax. A revocable trust is generally not a separate taxable entity. The trust uses the grantor’s social security number as its tax identification number as long as the grantor is alive. Following the death of the settlor, a revocable trust becomes irrevocable and must then obtain its own tax identification number. All assets held in the trust are included in the settlor’s taxable estate.
- A revocable trust does not protect the assets of the settlor’s creditors.
- Assets held in a revocable trust are treated as owned by the grantor in determining the grantor’s Medicaid eligibility.
- A revocable trust only controls the assets titled in the name of the trust.
A revocable trust has no impact on assets held in common name or that are governed by a beneficiary designation. -Tom O’Rourke
Almost useless factoid
Through Adrian dannhauser
There are eight times more atoms in a teaspoon of water than there are teaspoons of water in the Atlantic Ocean. One teaspoon of water (about 5ml) contains 2 × 1023 water molecules, but each water molecule is made up of 3 atoms: two hydrogen atoms and one oxygen. Also, if you were to drop every water molecule in a teaspoon end to end, you would end up with a length of 50 billion km, which is 10 times the width of our solar system.
Source: ZME Science
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