Estate Planning:
Frequently Asked Questions

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The following Frequently Asked Questions are meant to provide general information about estate planning–not particularized legal advice. Please contact us with any questions or to schedule an appointment.

General Questions

Do I need an estate plan? – Everyone has an estate. During our lifetimes we all accumulate assets, including tangible personal property, real estate, cash accounts, and securities. This is known as an estate. When we die, all of the assets we have accumulated must be passed to another person or entity. An estate plan allows you to control the distribution of your assets.

What happens if I die without an estate plan? – All states have laws that determine the distribution of a person’s assets if they die without an estate plan. If you die without an estate plan, your estate must go through a process called probate. In probate, a personal representative is appointed, a full accounting of all assets is performed, and the personal representative distributes the assets in the manner proscribed by the state’s law of intestacy.

What estate planning options are available to me? – There are three main ways to prepare an estate: (1) planning all assets to transfer by non-probate transfers (such as payable on death designations on bank accounts); (2) wills; and (3) trusts. Each option has its advantages and disadvantages. Non-probate transfers often require you to give up control of your assets during your lifetime, but they can be used effectively as a part of a larger estate plan that includes a will or trust. Wills, when paired with non-probate transfers, can be an efficient way of distributing assets to beneficiaries as you wish. Wills do not avoid the probate process. Trusts avoid the probate process so long as all of your assets are titled in the name of the trust.

Why should I be concerned about avoiding the probate process? – Anyone that has ever been through the probate process after the death of a loved one will tell you that it is complicated and can be overwhelming. Probate can be a time-consuming and costly. Depending on the particular circumstances, probate can cost from 4% to 8% of the assets of the estate–much more than a simple trust in most cases.

What documents are usually included in an estate plan? – Trust estate plans normally include (1) a trust and trust certificate; (2) a pour-over will; (3) a durable power of attorney; and, (4) a durable power of attorney for health care and HIPAA release. For people with certain assets or needs, additional “standalone” trusts can provide advantages, such as asset protection, special needs planning, or government benefits planning. Will estate plans normally include (1) a will; (2) a durable power of attorney; and, (3) a durable power of attorney for health care and HIPAA release. All estate plans can include deeds and changes in beneficiary designations on retirement accounts.

What advantages do trusts provide over other estate planning options? – Trusts can provide advantages that most other estate planning options cannot, including probate avoidance, estate planning, asset protection, and ease of administration.

Will a trust prevent me from paying estate taxes? – Under current law, you likely are not required to pay estate taxes. However, if you have sufficient assets to be required to pay estate taxes, trusts can be set up to take full advantage of exemptions and reduce tax liability.

Is a trust the best option for me? – We provide a full evaluation of the most appropriate estate planning options for every client. Our evaluations take half an hour and are part of our initial consultation.