Everyone needs some level of Estate Planning.
Estate Planning is the process of implementing various techniques and strategies designed to (i) manage one’s assets while they are alive, (ii) protect one’s assets for the benefit of their loved ones, (iii) provide for the management of one’s assets and their own personal care in the event of an incapacity, and (iv) distribute one’s assets upon their death to the people that they want to receive them and in a manner which efficiently and effectively accomplishes both their non-tax and tax-related objectives.
Simply put, Estate Planning is about making sure that the assets people accumulate during their lives are preserved, protected and properly distributed to their intended beneficiaries in accordance with their desires and in the most tax efficient manner as possible. However, while those objectives may be simply stated, in many situations such goals can be a lot more complicated to achieve than most people realize.
There are a myriad of legal strategies you might consider implementing as you design your estate plan. However, there are a handful of “must have” estate planning documents you must create before anything else.
You should have: (i) a Will – because absolutely everyone needs a Will; (ii) an Advance Health Care Directive for decisions concerning medical treatment when you cannot make or communicate your own wishes; (iii) a General Durable Power of Attorney authorizing “agents” you know and trust to take care of your financial matters in the event you were incapable of doing so; and, most likely, (iv) some type of Trust (based on your particular situation) to manage, protect and distribute your assets.
Will. A Will is a legal document that describes your intentions regarding the distribution of your probate estate when you pass away. Without a Will a person would die “intestate.” In that case, State law divides and distributes their probate estate to surviving family members based on their relationship to the deceased. No consideration is given under State law to how “close” such family members were to the decedent (or if they fought constantly). Contrary to popular belief, a Will has absolutely no legal authority until the maker of the Will dies and the Will is given to the proper probate court. Accordingly, your Will has no authority to appoint financial or health care decision-makers (agents) for you if you were incapacitated by an illness or injury. In many States, a Will is required to appoint guardians in the event minor children are orphaned. What could be more important than selecting the people you want to raise your children if you are not around to care for them?
Advance Health Care Directive. An Advance Directive is a legal document you execute now to specify the type and extent of medical care you would want if you were unable to make and/or communicate your own decisions in the future. Everyone over the age of 18 years needs to have this fundamental legal document.
How does an Advance Health Care Directive help my family? An Advance Directive appoints the persons (in order of priority) you have selected to make end-of-life decisions for you so that your family and medical staff know what to do (or what not to do). An Advance Directive will take some of the worry and anxiety away from your family, as they will know your wishes when it comes to making tough choices. With that in mind, choose your agents carefully; they may be charged with carrying out some very difficult decision and, perhaps, dealing with difficult family members.
General Durable Power of Attorney. This is a legal document which gives another person — sometimes called “the attorney-in-fact” or “agent” — the legal authority to make decisions on your behalf with respect to your financial affairs. The exact scope of a Power of Attorney is spelled out in the document itself. These powers cease when the maker passes away. A General “Durable” Power of Attorney should be used in order to prevent the Power of Attorney from expiring if you become incapacitated. Everyone over the age of 18 years needs to have this fundamental legal document.
Trusts. Generally speaking, a “Trust” is a legal arrangement by which one person or entity (the “Trustee”) holds property for the benefit of another person (the “Beneficiary”). Trusts can be created by the “Grantor” either pursuant to their Will (called a “Testamentary Trust”) or by an instrument made during the Grantor’s life (called an “Inter Vivos Trust”). There are many different types of Trusts, and they all serve different purposes and achieve different goals. Depending on your circumstances, there could be advantages to establishing one type of Trust or another.
The answer to that question depends on a great many factors. Consult with Varian Law LLC in order to thoroughly review your situation and your objectives.
At Varian Law LLC we provide a complete range of estate planning services. We take the time to develop customized estate plans that are specifically designed for each client’s unique circumstances. We spend personalized time with each client in order to comprehensively review their situation, determine their goals/objectives and bring both tax and non-tax related planning issues to their attention. At Varian Law LLC we also prudently follow-up with all the details (such as specialized beneficiary designation forms and retitling assets) in order to ensure that our clients’ estate plans are fully and properly implemented.
