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FAQ

 

Hiring An Attorney:

Why do I need an attorney? Can’t I represent myself?

If your corporation or LLC is involved in a lawsuit, the judge may not allow you to speak on behalf of the entity unless you are an attorney. In most other cases, you can represent yourself. Whether you should represent yourself is another question entirely. Representing yourself takes time and is stressful. Attorneys have years of experience dealing with the legal issues relating to your matter and they know the procedures and personalities of the court. Hiring an attorney puts that experience to work for you and takes some of the burden off your shoulders.

I can find a sample will/contract/other legal document on the Internet for much cheaper than an attorney would charge. Should I use it?

I think there is a place for forms and templates and I understand the financial incentive to purchase a form off the Internet. In cases where the transaction is straightforward and familiar perhaps a form obtained the Internet can be a good starting point. But you have to be aware of the risks. First, it isn’t always clear who prepared the form you intend to use and what he or she had in mind. The specific details of your situation will often require changes to the form. Sometimes differences in state law make a form intended for one state problematic if you try to use it in another. In their desire to save money, some people use the wrong form or don’t think through all the possibilities and end up worse off than when they started. It is always cheaper to hire an attorney before entering into a transaction than to hire an attorney after something goes wrong to litigate something that you didn’t anticipate. If you are going to use a form that you obtain from any source other than an attorney licensed in your state who is familiar with the details of your situation, I recommend that you at least have an attorney review it before you sign it.

What is probate?

Probate is the procedure of asking the court to give someone authority to administer the assets and affairs of someone who has passed away. The court will appoint someone as the executor or personal representative of the estate. The personal representative then gathers assets and determines what creditors need to be paid. When those issues are resolved, the personal representative arranges for distributions to heirs.

When is probate necessary?

Formal probate filed with the superior court is not always necessary. In Washington, if the person had less than $100,000 in assets and no real property (houses and land), an appropriate person can claim assets using the small estate procedure under RCW 11.62. If the estate has more assets or if those assets include real estate, then probate is necessary so that a person has legal authority to transfer assets into the names of the heirs. If the estate has no assets or is insolvent (its debts exceed its assets), consult with an attorney to discuss the advantages and disadvantages of opening a probate.

Do I still need a probate if my spouse passed away and everything we own is community property?

Unless the spouses created a community property agreement while married, probate is still often necessary to transfer assets to the surviving spouse. Title to the family home, for example, is commonly held in the names of both spouses as tenants in common. Even if the home is community property, title to the home still doesn’t automatically vest in the name of the spouse without recording a deed. Probate in this circumstance will often be very simple, but you should still talk to an attorney about the details to avoid problems down the road when the second spouse has also passed away. If the deceased spouse had any separate property, there are additional issues that should be discussed.

Isn’t probate expensive and time-consuming?

There is a popular perception that probate should be avoided because the assets are tied up for years and the lawyers end up getting it all anyway. This simply is not true in Washington. Probate attorney’s fees in Washington are simply based on the amount of time spent (other states allow attorneys to charge a percentage of the total value of the estate). In most cases, probate is done without court intervention, meaning that the court only gets involved to appoint a personal representative and if there is a dispute. A probate is often open for several months before it is complete (due to a 4-month creditor claim procedure that is usually used) but in the right circumstances preliminary distributions can be made before everything is complete. Of course, where there are disputes among the heirs or other problems with the probate, attorney’s fees will increase, but these issues are not the rule.

My relative has passed away. What do I do with his/her property? How do I get it into my name?

Some kinds of property pass automatically to a designated beneficiary. This is called non- probate property. It includes such things as life insurance proceeds or retirement accounts with a named beneficiary. Property held with rights of survivorship can also pass outside of probate. Otherwise, most property is transferred from the estate to the heirs by a personal representative appointed by the court through the probate process.

Who is responsible for the debts of my deceased relative?

Death does not change who is liable on a debt. In other words, if the deceased person was the only one liable for the debt before he or she passed away, then his or her estate is the only entity liable to repay the debt after death. Some unscrupulous debt collectors will try to intimidate family members into paying debts from their own funds by suggesting that the family is somehow liable to pay everything the decedent owed. Talk to an attorney if someone is trying to get you to pay a debt incurred by your family
member.

How do I give my home to a child?

Gifting real estate is generally done with a quitclaim deed. In order to record any deed in Washington, the county will also require that the parties fill out and sign a real estate excise tax affidavit. Note that giving property as a gift can trigger federal gift tax issues, so it is best to talk to an attorney about the details. It is important to make sure that giving the property is actually the best way to accomplish what you have in mind before you sign the deed. For example, some people give property to avoid probate without understanding the disadvantages of doing so.

I just bought a home and found out after the sale that there is a defect. Do I have any recourse?

Under Washington law, buying and selling real estate is very much a “buyer beware” scenario. It is difficult for a buyer to have effective legal recourse against a seller for defects discovered after the sale is complete. This underscores the importance of having good inspections and contracts before the sale is closed. If you’re in the position of discovering something that wasn’t properly disclosed, talk to an attorney about the details. If there is evidence the seller knew of the defect and failed to disclose it (or concealed it), there could be a claim for fraud (or fraudulent concealment) against the seller.

When can a tenant be evicted?

RCW 59.12.030 describes the reasons a tenant can be evicted and the notice that is required.

The most common reasons are:

• The Landlord can give a 3-day notice to pay or vacate if the tenant fails to pay rent when

due.

• The Landlord can give a 3-day notice to quit for committing waste, conducting an

unlawful business, or permitting a legal nuisance. (Note that a nuisance under the law

is more than just being annoying. It is an unreasonable or unwarranted interference

with another’s rights to use and enjoy property. It can be hard to pin down exactly what

constitutes a legal nuisance. You should talk to an attorney if you want to give or you

have received this kind of notice.)

• The Landlord can give a 10-day notice to cure or vacate for a breach of the lease other

than paying rent.

• The Landlord can give a 20-day notice (effective at the end of a lease period) to

terminate a month-to-month tenancy.

Do I need a business license?

In Washington, you need a business license if any of the following are true:

• Your business grosses $12,000 or more per year.

• You’re doing business using a name other than your full legal name.

• You plan to hire employees within the next 90 days.

• You sell a product or provide a service that is taxable.

• Your business has specialty licenses available through the Business Licensing Service.

How do I start a business?

The first step is to form an entity (usually LLC or corporation) with the Secretary of State. Skipping this step generally means that you are a sole proprietorship or partnership and the owners of the business will be personally on the hook for any liabilities of the business. Once the entity is formed, you would file the Master Business License application with the Business Licensing Service. Depending on what city you operate in, you may also need a city business license. In most cases, the business will also need to apply for an EIN from the IRS. The next steps will depend on your specific situation, but they include things like ensuring that you have the capital to run the business, obtaining other required permits or licenses, signing a lease, and hiring employees.

Should I form an LLC or a corporation?

The question of LLC v. corporation is resolved by considering how you want your business to be managed and taxed.

Corporations are owned by shareholders who elect directors who appoint officers who run the company. Corporations are required to have annual meetings of shareholders and directors (at least). On the other hand, LLCs are flexible. An LLC can be managed by the members or it can be managed by one or more managers appointed by the members. Often, the flexibility of an LLC is an advantage to small business owners. Corporations must file a tax return with the IRS. Corporations can be taxed under subchapter c or under subchapter s. A c-corp pays corporate-level tax in its income and the shareholders pay individual tax on their share of the profits. An s-corp avoids the corporate-level tax but there are restrictions on who can be the shareholder of an s-corp. LLCs by default are taxed as a partnership or sole proprietorship. This has the advantage of simplicity—tax returns for these entities are usually easier to prepare. LLCs also have the option of electing to be taxed as a corporation (either a c-corp or an s-corp) by filing forms with the IRS. Again, the flexibility that is available to an LLC in terms of taxation is often an advantage. Talk to your tax professional

about the details of your situation.

Note that both LLCs and corporations are a legal entity separate from the owner and the owners

of each kind of entity are generally not personally responsible to pay the debts of the business.

Can I have my employees sign a covenant not to compete?

Covenants not to compete are enforceable in Washington as long as the restrictions are not more onerous than is necessary to reasonably protect the legitimate business interests of the employer. Another important factor in enforceability of such a covenant is consideration—the employee must receive something of value in exchange for the covenant not to compete. If the covenant is a condition of employment when the employee is first hired, this may already be satisfied. If the employer wishes to impose the covenant on existing employees, some additional consideration is often required.

Do I need a will?

A will is a good idea for most people. A will allows you to state how you want your assets to be distributed after you pass away. If you don’t have a will, your assets will be distributed according to the default rules set by the legislature. Even if you’re happy with those default rules, a will is still a good idea because it allows you to designate someone to act as the representative of your estate and to do so without posting a bond. Without a will, the probate court will often require your family member to post a bond before being appointed to administer your estate. Finally, if you have minor children, a will gives you a chance to nominate a guardian to care for them should something happen to you.

I’ve read that a trust can avoid probate. Should I create a trust?

A “living trust” is an instrument that can designate how your property should be distributed after you die. If done correctly and if properly maintained, a trust can avoid the need to open a probate when you pass away because your property will pass by the terms of the trust. However, creating a trust and ensuring that it is properly funded is more
expensive than simply creating a will. Because probate in Washington is relatively uncomplicated and inexpensive, in many cases there is no compelling reason that it needs to be avoided. You should talk to an attorney about the details before you create a trust to make sure that it is a good idea in your situation.

What is a durable power of attorney?

A power of attorney is an instrument by which you can appoint someone to take care of things in your place. A durable power of attorney is one that continues to be effective even if the principal becomes incapacitated. A durable power of attorney is often used to make sure that a family member is able to take care of things in the event you become unable to handle your own affairs. Note that any power of attorney ceases to be effective when the principal passes away. In other words, the durable power of attorney is for handling affairs while you are alive. A will is for handling matters after you die.

What is a living will?

A living will is also sometimes called a health care directive or a directive to physicians. This document is a place for you to specify your wishes regarding continuing life support and other medical treatment in the event you are diagnosed with a terminal illness or a degenerative disease or if you are in a permanent unconscious state.

Didn’t see your question? Submit it and we’ll see if we can help you find an answer. This page is for informational purposes only and is not intended as legal advice. You should discuss the details of your situation with an attorney.

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