Estate Planning involves the arrangement of a personís legal and financial affairs for the orderly management and disposition of property at the time of disability or death. 

Objectives of an estate plan include:

Ensuring proper administration and disposition of assets at the proper time

                                    -Avoid unnecessary probate, minimize expense, inconvenience and publicity;

            -Minimize federal estate tax and state inheritance and estate tax;

            -Protect assets;

            -Provide for specific or charitable gifts.

 Documentation:

                                    -Revocable Living Trust;

            -Last Will and Testament (Pourover);

            -Durable Power of Attorney;     

            -Designation of Patient Advocate;

            -Transfer documents, including deeds, assignments, beneficiary designations.

What is a Revocable Living Trust?

A Trust is a contract that effectively transfers title to assets of the trust:

            -It is created by the Settlor (Grantor) during a lifetime;

            -It is funded with Settlorís property and held by a Trustee who can be the Settlor (Self-Trusteed);

            -Settlor can revoke the Trust and withdraw assets;

            -Upon Settlorís death, the Trust provides for the Settlorís heirs and beneficiaries (substitutes for Will);

            -Settlor is the sole lifetime beneficiary of the Trust;

            -A Successor Trustee administers the Trust according to its terms upon the death or disability of the Settlor;

 Advantages of a Revocable Living Trust:

                                    -Avoids probate delay and expenses;

            -Private administration;

            -Avoids interruption of income and investment on disability or death;

            -May be the recipient of estate assets, insurance proceeds and death benefits from retirement plans;

            -Enables business to continue operations;

            -May relieve Settlor of investment burdens;

            -Less vulnerable to attack based on incapacity, fraud or duress;

            -Less formal accounting and judicial supervision than Trust under Will;

            -May provide for charitable gifts in jurisdictions which limit charitable gifts by Will.

 Disadvantages (possible drawbacks):

             -Requires transfer of assets, operating bank account;

            -Operates Trust as a legal entity;

            -Cost to prepare Trust and transfer assets probably greater than cost of a Will;

            -Probate estate may allow some postmortem tax planning since there is another taxpayer.

 Who can use a Revocable Living Trust?

Each Individualís circumstances will vary and depending on the facts, it is difficult to generalize.  However, if any of the following apply, a person should consider establishing a Revocable Living Trust:

             -A desire to avoid probate and eliminate the risk of joint ownership;

            -Married individuals with estates over $1,000,000;

            -A desire to extend the time when a beneficiary receives an inheritance;

            -A desire to choose who will manage your legal and financial affairs on disability or death;

            -A desire to provide an individual with life income, remainder to another;

      -                 A desire to protect minor children;

            -Use of a standby Trust to be used upon disability even if no assets are immediately transferred.

 Conclusion:

          For additional information and estate planning opportunities which will benefit you and your heirs, please contact our firm to arrange an appointment to discuss your individual needs.

          This does not attempt to give specific legal or tax advice.  Competent legal, tax or investment advisors should be consulted for your particular situation.