GNGcp33QEHQzTp4kjoWItI3gWMt2WVLv: 2012

Sunday, December 9, 2012

Is Dying Legal?

Many public surveys have shown that 70-80 percent of Americans don't have an up-to-date will. So what?

Well, for you it's no big deal, right? After all, you have nothing more to worry about. You're now resting quietly unable to voice your opinions. While your enemies might like that, it may not go well for your family if you don't have a will, especially if you have young children, assets and maybe even a divorced spouse hanging around to see what he or she can collect when the state decides what to do with your assets and your children.

Most people have no idea of the consequences for not making your final requests part of the permanent legal record. Without a guide for the probate judge to go by, the state then takes over and takes a healthy portion of what you once owned and then maybe your family might get some of the pie.

So why not get a will done now? There are dozens of excuses. Here are a few.

"I have nothing anybody wants." - How do you know? Some of the most insignificant items are fought over by families because the deceased didn't bother to tell anyone who would get them. "I don't have the money to pay a lawyer to create a will." - This is actually a fairly good excuse. But if you have Pre-Paid Legal Family Plan, a will comes free with the service for the husband and wife or domestic partners. The service costs only $19.95 per month with no contract. So now a real lawyer can draft your wills for less than $20 per month. Is lack of money really an excuse? "My children under 18 will go to my sister or brother." - Maybe and maybe not. You now have no control over what a judge will do with your children if you and your wife suddenly passed away. On 911 about 3000 people did not anticipate losing their lives. Consequently, many of the children of those families ended up in foster homes because their parents did not have wills. "I have a will from years ago on a piece of paper somewhere." - That document may not hold up in probate. Suppose you have a piece of property that you want to transfer to a family member after you die. If the documents of transfer aren't drawn up properly, how do you know your wishes will be carried out?

You see, dying is a legal process just like birth. You will generate paper work regardless of your status. For example, my sister is a hospice administrator who constantly signs death certificates and must ensure the accuracy of those certificates as best she can so that the government knows where you are.

In closing, we spend so much time in life creating family and accumulating assets. Doesn't it make sense to make sure they are transferred properly according to your wishes?

For more information on legal plans for your family, go to www.neverquitworking.com.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Avoid a Guardianship How to Include Your Pets in Your Estate Plan

Picking Estate Fiduciaries

A fiduciary is someone who monitors assets for you, with your best interests in mind. This may be a financial institution, a property management company or a trustee. Fiduciaries are not only an important part of life; they are also essential during your disability and after your death. During the estate planning process, you must take care when choosing your attorney-in-fact, health care agent, successor trustee, or estate executor.

Loyalty

Every fiduciary that you name must be loyal to you and to your heirs. You are placing a great deal of responsibility into the hands of your chosen agent, and you must be sure that person will act honestly in all actions. It is against the law for any fiduciary to use your assets for his or her gain.

Reliable

You must also choose a fiduciary you and your family can rely on. Your agent must have the time and willingness to handle the matters you have asked of him or her. Your family must be able to count on the chosen fiduciary completing all assigned duties.

Good with Finances

Your selected advocate must be organized and able to manage finances. The most complicated of fiduciary duties revolve around managing your financial assets if you become disabled as well as after your death. An estate executor or successor trustee must handle every single asset and debt that you have. This process requires organization and attention to detail.

Reasonable

Your fiduciary may have to work with family members who are in disagreement over the state of your final affairs. Pick a fiduciary that can remain emotionally and intellectually apart from issues and make reasonable, rather than emotional, decisions. The ability to deal with and put aside family arguments after the death of a loved one is perhaps the hardest duty your fiduciary will face. Choose someone who has the strength to accomplish this feat.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Include Your Pets in Your Estate Plan Planning For Your Personal Effects

What's the Difference Between a Last Will and a Living Trust?

Before visiting your estate lawyer, it's a good idea to spend some time learning about the various documents and procedures involved with estate planning.

An essential topic to every estate plan is probate. Probate is a court-supervised procedure for transferring the legal title of your assets after death to your beneficiaries. The probate process involves:

Proving to the Court that a Will exists and is valid. Appointing a legal representative with authority to act on behalf of the estate. Identifying and appraising the property of the estate. Paying debts and taxes. Distributing the remaining property according to the beneficiaries.

Probate proceedings are public records and typically last several months. Any property listed in your name that does not automatically transfer upon your death, is considered probate property. For this reason, a last will goes to probate and a living trust does not.

You may have been told that a trust is more ideal than a will since it can avoid probate. However, there are other details to consider when choosing an estate plan.

Last Will and Testaments After a will is drawn up, it must go through a formal legal procedure called executing the will. This requires witnesses to the signing of the will. A will is put into effect only upon death, with the provisions controlling all assets subject to probate. Any assigned accounts are not subject to probate and will not be distributed under the terms of a will. Non-probate property such as life insurance, retirement plans, and joint tenancy accounts will pass directly to the named beneficiaries by the institution holding the account.

When it comes to costs, wills are usually cheaper to create, but more expensive down the road when heirs have to manage the estate. A will provides little assistance for asset management while the person is living. If a person becomes physically or mentally incapacitated, the court must appoint a guardian to manage the estate. Even with a good power of attorney, this process is usually burdensome and expensive.

Every state has its own variation of laws that pertain to last wills. When a will is clearly laid out, the accepted rule is that if a will was valid in the state it was made, it remains valid even when moving to a different state. However, if there are any uncertainties or exclusions, the will is usually interpreted by the laws of the state of residency. Thus, other state-specific documents should be created in the new state after each move.

In order to change or add anything in a last will, a codicil must be filed. A codicil is an amendment which must be executed with the same formalities as the original will. Sometimes it is simpler to draw up a new will instead. The original will and any codicils must be presented after death.

While a last will must go through probate, there are simpler types of probate depending on size and type of assets and whether or not there is any contest to the will.

Living Trusts A living trust is a contract between the creator of the contract and the trustee who agrees to hold assets for the beneficiaries. Each trust has three necessary parties: grantor, trustee, and beneficiary. Typically, one person is all three. The grantor retains all rights to manage the trust while alive and legally competent.

Any terms and conditions can be added, since living trusts are contractual; and because there is much less variation in state trust laws, they can be carried to different states without significant problems. Assets can be added and removed at any time without any tax penalties. As with other contractual arrangements, trusts are not usually required to become public knowledge.

Living trusts are more expensive to create and maintain, but leave fewer burdens on a spouse, children or other heirs later. If the grantor becomes incapacitated, the living trust names a successor trustee to take over and continue to manage the trust. Asset management as a successor trustee is generally much simpler than through the use of a power of attorney.

At the death of the grantor, the terms of the trust define who inherits the trust. The assets can be distributed to the beneficiaries in any manner the grantor chooses. The distribution is private and does not need any court supervision, so the successor trustee can immediately access any accounts held in the trust.

A living trust is designed so that the assets are not a part of the probate process. However, this only works if the provisions are properly put in place during life.

Estate Planning Both wills and trusts are effective tools to manage an estate during and after life. There are no "one size fits all" plans, so it's important to discuss your options with an estate lawyer.

Estate Planning - Living Wills and Durable Powers of Attorney For Health and Finance

Estate planning frequently involves more than just having a Will. Living wills as well as durable powers of attorney for health care and finance protect your estate in case your are incapacitated, but not deceased.

A living will permits you to express your wishes regarding resuscitation and life maintaining measures in the event you later become incapable of communicating your desires. It can help you try to avoid what some believe to be an undignified existence by allowing you to decline medical treatment, food, and water if these things are "artificially" keeping you alive. The choice is yours to make and physicians will honor your wishes if the proper documents are submitted.

A durable power of attorney for health care, on the other hand, allows you to appoint another person to make decisions for you regarding your medical care in the event you cannot. This power is broader than the living will. It, too, covers situations where you may be terminally ill and need resuscitation or other life maintaining measures to stay alive. Your agent, or attorney-in-fact, can decline these treatments if you give them that power. It also applies to situations where a health care decision is required but you cannot make that decision yourself (i.e., you are unconscious as a result of injury). Your agent could authorize or decline medical treatment on your behalf.

A durable power of attorney for finance allows you to appoint another person to make decisions for you regarding your real and personal property. This power is broad and covers situations where you are terminally ill or unconscious as a result of injury, but still living. Your agent, or attorney-in-fact, can manage your financial affairs as you so wish.

If you decide to create either a living will or a durable power of attorney for health care and/or finance, you will need to consider several things before you complete the documents. You will have to provide the name and contact information for the individual(s) that you nominate to make decisions for you in the event that you cannot make them.

Be sure to inform the person you nominate of your wishes. You can permit or refuse to permit donation of your organs for transplant. You can also permit or refuse to permit donation of your body for scientific or educational purposes. Some people wish to spend their last days at home rather than in a hospital. Some people wish to nominate one person to act as their attorney-in-fact for health care and another for their finance. You can express your wishes regarding these issues in these documents. Finally, you can express your wishes about funeral arrangements.

Please consult with an attorney if you desire to execute or have questions regarding estate planning documents.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will Planning For Your Personal Effects How to Avoid a Guardianship

Need Legal Advice on Wills and Trusts?

If you're putting your life in order, and preparing to look after both your assets and the people that you love and care for, then it is a good idea to seek legal advice on wills and trusts. It makes financial sense to create a plan and provide documentation to ensure that your assets are shared out in the way you prefer.

If you are not married, or have had a civil union, but want to leave your partner your assets, or want to specify specific mementos for them to own, then you'll need to write this down. The law will distribute your assets according to who is your closest kin by law if you haven't supplied information that supersedes this. It's important to make sure you've provided for your partner in this eventuality.

Alternatively, if you have been married or in a civil union and you are no longer, you may want to instruct that your previous partner receives nothing, or less than they would have before.

It can also help protect your assets from extra taxes and costs, leaving the people you are passing it onto in a better financial position.

Even if you are married or are in a civil union without children, and it all looks straight forward, you still may need legal advice on wills and trusts. Your asset disbursement can be contested and legal proceedings can eat away at your assets, and prolong the length of time before the assets are moved from your estate to the people or organisations you would have passed them onto.

For some, succession planning is not just about writing a will, but is also about establishing a trust that can look after assets regardless of your health in later years, and protect your interests and those of your family from others who may have influence over the outcome. This can include ex married or civil union partners of your offspring.

We can spend our lives building up our assets and creating something from what we were given, be it our own inheritance, or from the education and inspiration from the people who have influenced us. Protecting all that you've built so that the next generation can expand on it and/or pass it on again, is an excellent reason to seek legal advice on wills and trusts. Your assets and your loved ones will both benefit.

Trust Planning: Wills Vs Trusts

Wills vs Trusts: which is best for you?

A trust is basically a legal contract that transfers property and assets from one person, the grantor, to another person or group of person, the beneficiaries, through the trustee. The GRANTOR is the person with the property or asset to transfer. The TRUSTEE takes care of the assets and or property for the benefits of the BENEFICIARIES. This is often done while the grantor is still alive, hence, the name Living Trust.

A will, on the other hand is a deed that states how you would like your property, assets and other effects managed and distributed or divided upon your death. There is also PROBATE, the process in which the will is submitted to a court for administration after your passing and for accomplishment. The EXECUTOR of the will, usually a person named in the will and usually a lawyer, is the person responsible for managing the affairs of the estate as it goes through probate. The court will then supervise your estate and the distribution of your assets as descried in your will with specifications on the requisites for transfer of your assets.

Choosing: pros and cons

When looking at wills vs trusts, trusts seem to have the upper hand. Trusts, as stated above, are acted upon while you are still alive, thus giving you the opportunity to supervise the transfer of ownership of assets and property personally. With living trusts, there are revocable and irrevocable trusts. The revocable trust can be changed at anytime if the grantor is not satisfied or is having second thoughts about the beneficiary or the trustee. Irrevocable trusts cannot be changed, well not without a lengthy process, so the grantor should be careful when trust planning an irrevocable trust.

When it comes to a will, given that you will be dead by the time the will is executed, you can not oversee the transfer yourself. Although the will is very specific in what you want done, it usually takes a long time to process. The probate, for one thing, takes a lot of time, and also requires a lawyer which incurs cost to your estate.

So, in the comparison of wills vs. trusts, the living trusts come out as the strong and practical choice. But in choosing which is best for you is up to you. The trick is to research more and finding out more about them in other wills vs trusts comparison.

It all comes down to careful planning.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will Planning For Your Personal Effects

The Importance of Choosing a Quality Living Will

Most of us have heard of a "Living Will." It is document in which you write out your health care wishes, including any desires you may have about the use of "aggressive and/or invasive" life-sustaining medical treatment. It is to be used if questions arise about what kind of medical care you would or would not want, in situations where you are too ill or injured to make your wishes known.

A "medical power of attorney" or "health care proxy" document is somewhat different. It allows you to name someone you trust to make health care decisions for you, if you are ever too ill or injured to make those decisions for yourself. He or she must always consult your Living Will, and can only make decisions in your behalf that you have not already made for yourself.

The term "Advance Directive" is an umbrella term, and it refers to both Living Wills and Medical Power of Attorney documents.

Naming someone as an "agent" (or as a proxy, surrogate, or representative decision-maker -- the terms vary according to the laws in your state) can be very important. Although most states allow family members to make health care decisions for their loved ones, it is often difficult for families to agree on what should be done.

Sometimes their desires might supersede your own. Further, you may find that the person you trust most, or the one you feel is most capable, is not a family member. Consequently, it is usually best for you to name the person you want making these decisions. Although he or she can still consult with others, the final decision is his or hers alone. This can avoid the distress of disagreements, or even critical delays in medical care at times of contention.

Now that you know the purpose of a Living Will and a Medical Power of Attorney (or proxy appointment document), you need to consider the kind of forms you should use.

Most people simply select the standard form available in their state -- often called a "statutory" advance directive. Many of these forms are available for free on the internet, and they are usually quick and easy to complete.

However, a large body of research has identified many short-comings in these documents. Virtually all of them have been found to be overly simplistic, confusing, laden with legal jargon, and so vague and unclear in the kinds of terms they use that even physicians themselves are often unsure how to apply much of what has been recorded in them.

Sometimes these documents may even be biased in ways that inhibit or outright limit an individual's ability to fully express their personal wishes. For example, one legal research group found their state's advance directive to be "more protective of provider liability than patient rights" (see: Tyminski, MO. Journal of Law and Health. 2004-2005;19(2):411-49).

Another research group emphasized that, "...the development of statutory forms occurs in the legislative arena, [so] their content is the result of a political rather than a 'scientific' process," and because of "political compromise,...many of the forms ultimately passed by the legislatures are not optimal from a consumer perspective" (see: Hoffmann, DE; etal. Journal of Law, Medicine & Ethics. 1996;24(1)(Spring):5-17). They concluded by noting that the use of biased, confusing, and vague documents was potentially "dangerous," as these documents are typically used to address life-sustaining medical care wishes.

The American Bar Association has agreed, and has emphasized that the "statutory advance directive is not necessarily the exclusive, or even the best, pathway for individuals to follow," and they suggest alternative documents in situations where the existing content is too limited (see: Patient Self Determination Act State Law Guide, 1991, page 18. Government printing office, Washington, DC).

There are a great many alternative advance directive documents available, and many can be obtained via the internet. For example, the National Healthcare Decisions Day website (http://www.nationalhealthcaredecisionsday.org/takeaction/advance_directive) offers links a variety of such documents.

Regardless of the form chosen, a quality living will is crucial. It should guide and assist individuals in fully and clearly expressing their health care wishes. When a comprehensive array of options are presented, it can inspire important thinking, discussions, and decisions far more effectively than trying and "brainstorm" them all alone.

In addition, it aids an individual in fully writing out instructions that are important. Wishes that are not written down are very difficult to even remember, much less to follow-up and honor.

It should be emphasized that an appointed representative can only make quality decisions if useful and complete information is available. Otherwise, he or she may be forced to chose according to his or her personal preferences, instead of being able to determine what you might actually want. Further, should anyone question the decisions of an appointed representative, it is ideal when he or she can point to specific evidence of one's wishes whenever possible.

Certainly every adult should complete an advance directive. But, it is also important that the documents chosen are well crafted and highly effective for the important purposes intended.

Understanding the Legal Process of Probate

Probate is a complex legal process that involves the distribution of a deceased person's estate to their beneficiaries. Typically, there is an existing will which specifies how the estate should be administered. A surrogate court will make a decision on the validity of the will. The instructions of the deceased will be examined during this process. And an appointed executor of the estate will act as the personal representative of the estate and will hear the interests of heirs and other parties that have any claims against the estate.

During this legal process, the deceased person's property is retitled out of their name and transferred to their beneficiary. This legal proceeding can last for several weeks or several months depending on whether or not their are any objections to the administration of the estate. Before any disbursements can be made, all creditors need to be notified and legal notices have to be published.

It is the responsibility of the trustee to settle any unpaid debts by distributing the descendants assets. In many cases, a petition to appoint a personal representative may need to be filed and Letters of Administration obtained. If there are any pending lawsuits involving the estate, these will have to be resolved before the administration of the estate. This is why this process could take many years to resolve.

If there are any real estate assets, they may need to be sold in order to pay off debts or to settle a law suit. Any estate taxes must be also be taken care of if applicable. It is important to have a lawyer that specializes in these proceedings handle the court issues regarding the estate. This will make the process go much faster and smoother. There are certain legal steps that must be followed in a timely manner.

When a probate case is opened with the court, the executor takes an account of the decedent's property and will be responsible for paying any debts. After the debts have been paid, all taxes must be paid as well, including the estate tax. After all of the applicable taxes have been paid, the remaining property can be administered to the beneficiaries. This will be as instructed by the decedent in the will.

If there are any parties that do not agree with the distribution of assets, the may contest the administration of the estate. This contest may be based on several factors that must be addressed in court. In such an event, the personal representative must abide by the fiduciary duties of the estate and hold the assets in an interest bearing account until a settlement or decision is reached.

If at all possible, it is best to avoid probate. This legal process can last from a few months to several years. It can mount up in legal costs and delay beneficiaries from receiving their monetary administration of the estate. There are many ways to avoid this process. One popular way to to have a Living trust. The original owner of the trust can transfer their assets to a Trust account which the owner controls. When the owner of the trust dies, the listed beneficiaries in the trust will then have ownership of the property of the trust. A living trust protects the deceased assets and the heirs from a public probate process.

Getting The Most From Your IRA

If you have a traditional IRA that's large enough for you to plan on passing it on to a beneficiary, you're likely interested in finding out how to make the IRA last as long as possible. As you probably know, the IRS requires owners of traditional IRA's to take a required minimum distribution (RMD) from the account each year, beginning on April 1 of the year after you reach age 70 ½. The amount of your RMD will vary each year, because it's determined by taking the balance of the account on December 31st of the previous year, and dividing that number by the number of years left in your life expectancy, as determined by the IRS.

Roth IRA's differ from traditional IRA's in a number of respects, with one of these differences being that the Roth IRA does not have an RMD. So, it may make sense for you to convert your traditional IRA to a Roth if you are trying to avoid the RMD, along with other considerations. When you do this, keep in mind that you'll have to pay income tax on the amount you convert, but you won't be required to touch the money in the account.

The rules are different for beneficiaries, though. Whereas you, as the owner of the account, have no RMD associated with your Roth account, your beneficiary will have to take a required minimum distribution each year. Just like for a traditional IRA, the beneficiary's RMD will be calculated based on his or her life expectancy, so it makes sense to choose a young beneficiary if you want him or her to get the maximum benefit from the account. You'll also want to choose a contingent, or alternate, beneficiary. This way, if your primary beneficiary passes away before you do, your IRA passes to another person and not to your estate. You don't want your IRA to pass to your estate because, worst-case scenario, this could result in a requirement that the account be cashed out completely within five years.

If you're worried that your chosen beneficiary will cash out your IRA instead of maximizing its value by taking only the required minimum distributions, there are some estate planning strategies you can use. Talk to your estate planning attorney to find out how to make sure your IRA - and your beneficiary - are protected.

3 Things to Consider in Choosing an Estate Planner Or Why You Should Have One at All

Estate planning or inheritance planning is a speciaialized art, one that comes with practise and experience.

To go back one step though, you might ask yourself why the need for an estate planner - in an act of modesty I have witnessed so often that I have lost count, people always say their affairs are much too simple to warrant engaging an estate planner. Often this is false modesty.

An estate planner would at a minimum be a qualified and competent in drafting a will, from the information required to compose the will, he would be able to inform the client of the likely situation if nothing were done - after all, doing nothing is sometimes a viable option. Many clients would on account of the simplicity of their estates require nothing more than a will and a complete set of power of attorney documents, which can often be had for well under a couple of hundred pounds.

A decent estate planning professional would provide a service hard to replicate by any other professional.

In the first instance, one would be urged to avoid kits; forms; templates; books indeed anything that requires of you more than basic biographical or factual information - the DIY approach often assume that the person making the arrangements is skilled and experienced in such matters - I saw a client recently who wanted to leave the majority of her assets to her children, but a small gift to her sister - the manner in which she worded her request meant the sister would have got her gift free of inheritance tax, while her children would have been lumbered with a hefty inheritance tax bill - on explaining the potential consequence of her preferred wording she agreed that she wanted her children to have no inheritance tax liability while it was of secondary importance if the value of the gift that her sister received would have been diminished by any taxes.

In the main, you are buying the experience of your estate planner. The DIY approach fails to bring context to your estate planning. While a do it yourself will might be cheaper, than engaging the services of a professional, like most things in life, what we pay for is what we get. A suitably experienced solicitor, paralegal or estate planner would be adept at finding out the personal and financial details of your life and document the basis of arriving at the will that you finally draw up.

The point of engaging the professional is not merely to produce the document - while this might be seen as some as an end in itself, but to guide you through the process of ensuring that when you are no longer of this world, your wealth is applied in the manner you would have wanted. That your loved ones get the maximum inheritance you would have wanted them to, with a minimum of fuss; expense and interference from outsiders including the taxman.

A client recently said to me that it was all very well leaving his wealth to his family, but he failed to see the merit of lumbering them with a mountain of paper work and potential liability to taxation - his was rather an interesting point as there were 2 factors for him to consider, the first was that if the status quo applied at the time of his death, as there was [relatively] little cash in the estate, a good proportion of the assets he was looking to bequeath would have had to have been sold to meet the tax liability, the second point was that with simple manipulation of his estate, there potential liability to inheritance tax was reduced to zero. This brings to mind what a client told me only last week 'I hear the government is broke, but my money would do far more good in my family than in the treasury'.

In sum a professional estate planner would save you and your family far more than he or she costs you - plus to put a cash value on the hassle that is avoided, it pays to consult a professional.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Include Your Pets in Your Estate Plan

Protecting Your Loved One With a Special Needs Trust

If, like Sabina and me, you have a loved one who is disabled, then you know how important government assistance programs can be to their well-being. But to qualify for these programs, your dependent must have limited finances. So, any inheritance you leave him or her could potentially put their eligibility for government assistance at risk.

So, how can you provide for a loved one without interfering with government assistance?

What you need is a Special Needs Trust.

This unique legal document allows you to provide for your dependent's supplemental needs without disqualifying him or her from programs such as Social Security and Medicaid.

Upon your death, any funds you intended for your disabled dependent will be transferred to a special trust, created for the sole purpose of providing for your dependent. Because the funds are not in your dependent's name and are managed by a third-party trustee, your dependent can continue to benefit from government assistance.

Of course, there are restrictions on what the trust can pay for but in general, you're allowed to provide for any supplemental needs, such as cable television, travel expenses, education, entertainment and the like. The trust can also provide your dependent with home health care services, a car, clothing and even pay for medical expenses. Just remember than any asset that requires a title or deed must be in the name of the trust and not your dependent.

This allows you to ensure that your disabled dependent is well provided for and enjoys a rich and happy life while still qualifying for those much-needed government programs.

Who Should Be Trustee?

Choosing a trustee for a Special Needs Trust is especially important because the person you choose will have authority and control over the funds in the trust. That means you need to be able to trust this person completely, especially if your dependent is mentally handicapped and unable to recognize any misappropriation of funds. Many people choose a parent or sibling of the disabled person to act as trustee, but you can select anyone you want, including a law firm or a financial institution.

Last Will and Testament Template - Ensuring That Your Loved Ones Are Taken Care Of

When considering how to get your last will and testament drawn up you may have been told that any old piece of paper will do. This may be true in some states and in many cases, however it is important for you to keep in mind that if your will gets contested in any way the more legal your document looks the better the chances that it will hold up in court. While you do not need a lawyer it is important that you take the time to find a last will and testament template with which to make out your will if you want it to be taken seriously.

There are various laws in different states regarding wills so it is very important that you take the time to research the laws in your state before you set out to make your own will. There may be several steps you need to take, a certain way you need to make your will out, and you will need to have it witnessed in some way to make sure that it is uncontestable in a court of law. This is where a template can be very useful when making your will, you can use the template to get the general elements of a legal will but then you can edit it to reflect the laws in your state.

There are several elements that need to be in every will, you of course will need to identify yourself and your estate. This is important to ensure that people understand that it was actually you who wrote the will. A brief description of all of your general assets should be present, but this does not have to be overly specific, a description such as a home and its contents, monetary assets and life insurance will be sufficient.

You will need to name your beneficiaries and what is being left to them next, this is where you must be more specific because it is one the one part of the will that gets disputed the most. You should name alternate beneficiaries if something happens to the person named first, and you should also list any gifts, trusts or debt cancellations you wish to take place.

Finally you need to name an executor and address any issue of guardianship for your child, then sign your name and date it. There should also be a place for a witness to sign or notarize as well. By using a last will and testament template you can ensure that your document is as accurate and legal as possible and that there will be little chance of it being overturned in court.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Include Your Pets in Your Estate Plan

A Guide To Understanding Estate Planning Documents

When it comes time to consider estate planning, many people can procrastinate without understanding the consequences of their delay. No one is truly comfortable thinking about what happens in the case of injury, disability, or even death, especially if young children are involved. However, one of the best ways to achieve peace of mind is to have a complete estate plan in place to make sure your family is taken care of when the time comes.

There are five primary documents when it comes to estate planning, ranging from a Will to a Power of Attorney. Let's take a moment to look at these five documents that help us make sure our families are taken care of. Laws can vary by state, so it's important to have each document drawn up by a local attorney who's familiar with each state's regulations and guidelines.

Will

The Will is what many people think in terms of complete estate planning. This document primarily addresses three important questions, but only comes into effect upon one's death. First, it designates who controls the administration of one's estate after someone passes away. Second, it establishes who receives the assets. Third, it designates legal guardians and conservators to handle the medical and financial decisions if there are any surviving minors. This document is vital in securing the foundation of your final matters if you do not have a Revocable Living Trust.

Power of Attorney: Medical and Financial

There are two main types of power of attorney documents everybody needs: a Financial Power of Attorney and a Medical Power of Attorney. These two documents are only effective while one is alive. They grant a person control of financial and medical affairs in the case of disability, a coma, or any circumstance that would prevent you from making your own decisions. Each document helps prevent the expense of a court proceeding to determine who is allowed to manage your financial and medical decisions when you are unable to do so.

Living Will

The Living Will, also known as an advanced medical directive, is used to officially state, in advance, whether one wants to refuse or terminate the use of artificial life support should the situation arise. This document also allows an individual to state in advance whether he or she should receive food and water in the event the Living Will is in effect. By establishing your desires in advance, it helps remove such burden from your family's shoulders.

Living Trust

A Living Trust, also known as a revocable trust or revocable living trust, is an alternative to the standard Will. It is a tremendously flexible document that can provide for the management of one's assets while alive and upon his or her passing. This method of estate planning enables exceptional control over one's assets. If drafted properly, it limits or eliminates certain taxes and offers a tremendous degree of asset protection for one's heirs should they ever get divorced or have other creditor problems.

These five documents cover several of life's circumstances and should be a part of everybody's base estate plan.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Include Your Pets in Your Estate Plan

What You Don't Know About Your Estate Planning Could Hurt You!

Estate Planning is the process of looking at one's financial situation, preparing a plan for how income and property will be handled if a person should become disabled or die, and signing legal papers to implement the plan.

Most people are concerned about what will happen to their property when they die. If a person does not decide who should inherit from them and sign the appropriate legal documents, the law will "fill in the blanks" and make the decision for them. Under Illinois law, if a person dies without a will, or without some other legal mechanism for designating who will inherit from that person - such as naming a beneficiary on a bank account, insurance policy, or in a trust - that property will go to family members called "legal heirs."

For example, under Illinois law, property will go to the husband or wife of the deceased upon death, unless the deceased also has children, in which case only 50% goes to the husband or wife, and the other 50% is divided among the children. If the deceased person has no husband or wife, 100% is divided equally among the children. If the deceased person has no spouse and never had any children, the property goes to the parents and brothers and sisters, in equal shares. There are other legal rules governing who will inherit if certain family members died before the deceased person, or if none of the relatives listed above remain.

What Is a Will?

A will is a written statement directing who will wrap up the financial affairs, and who will receive someone's money and other property when the person passes away. The property left in the deceased's name at the time of death is called the "estate." The people named in the will to receive property upon the decedent's death are called "legatees." They may or may not also be the "legal heirs."

What is a Living Trust?

A "living" or "intervivos" trust is one that is set up and funded while the grantor is alive. Usually the grantor names himself or herself both trustee and beneficiary. In contrast, a trust which comes into being under the terms of a will, after the grantor's death, is called a "testamentary" trust.

One might set up a living trust to provide for a smooth transition to another trustee or beneficiary upon his or her death or incapacity. If the beneficiary of the trust dies, the property in the trust can pass to another beneficiary without the need for probate court proceedings. A living trust can also help avoid the need for appointment of a guardian. Where the grantor/trustee becomes incapacitated, a successor trustee can take over management of the trust.

What are Guardianships?

Parents or other family care givers may worry about who will care for, and protect, disabled children or adults, when the parents are no longer able to do so, either due to death or any other event which renders them unable to continue in their role as protector and/or care giver. It is especially important to assure that someone who has the knowledge, experience, and motivation, to adequately identify the disabled person's needs, and to find, and arrange for, the services necessary to meet those needs, can step in when needed.

Keeping Insurance Proceeds Out of Your Taxable Estate

After you die, all the assets you owned in your individual name at the time of your death will be listed on your Federal Estate Tax Return. If the value of your estate is higher than the estate tax threshold for that year, an estate tax will be owed. In 2011, the estate tax threshold will be $1 million and the estate tax will be a whopping 55 (fifty-five) percent. Estate taxes must be paid in cash within nine (9) months of death. For every dollar you pass over the first million, your estate will be taxed 55 cents. A million dollars may sound like a large amount of money but it is really quite small when you consider that it includes life insurance proceeds, the value of your home, stocks, bank accounts, retirement accounts, jewelry, paintings, and anything else that you may have had titled in your name at the time you died.

One approach to providing ready cash to pay these taxes and other expenses is through life insurance proceeds. The proceeds may be paid to the Federal government instead of your heirs having to liquidate assets in order to pay the estate tax bill. Life insurance provides an income tax free death benefit but the value of the benefit is added to the total of assets in the estate if not structured properly. This creates a never-ending cycle of taxes and insurance policies. The way to avoid this result, limit or eliminate your estate tax, and provide tax free money to your beneficiaries is to hold the life insurance policies in an Irrevocable Life Insurance Trust, or ILIT.

An ILIT combines the protection a trust with the liquidity of life insurance benefits. Using the $13,000 per year gift tax exclusion, you can gift assets to the ILIT annually to cover the insurance premiums with no tax consequence. At your death, the proceeds are transferred to your heirs free of all income tax and all estate tax. This will provide the necessary liquidity your heirs will need to pay your funeral costs, estate taxes, probate fees and settlement costs.

Upon your death, the trustee of the ILIT will make appropriate distributions of cash proceeds to cover debts, taxes, and funeral expenses. The trustee could even purchase some or all of your business with the cash proceeds and professionally run the business until your children were old enough to take over. The trustee could also make appropriate loans to the spouse, children, and business.

An ILIT provides flexibility and tax advantages. For more information on ILITs and to determine if they are the right vehicle for you, please contact your South Florida estate planning attorney.

Tips in Making a Family Tree for Your Estate Plan Retirement Planning: It's About More Than Just Finances Preparing and Writing Your Own Living Will How to Include Your Pets in Your Estate Plan