Helping You Protect Your Legacy Providing the Guidance You and Your Family Need

Frequently Asked Questions

Expert Answers from Our Leesburg Estate Planning Attorney

Planning for your family’s future can often seem overwhelming. If you have questions, the estate planning attorney at Legacy Law Centers has answers. We assist clients in Leesburg and throughout Loudoun County with wills, trusts, legacy planning, advance directives, powers of attorney, and virtually all other estate planning matters. Our experienced attorney can simplify the legal jargon and explain your options in a way that is easy to understand. If your question is not answered below, give us a call and arrange a consultation. We would be happy to help you.

  • BASICS

    What is estate planning?

    It may surprise you to know that estate planning has very little to do with money or legal documents. Estate planning is really about creating your legacy: protecting and providing for you, your loved ones, and your property; staying in control; and offering guidance.

    Who needs estate planning?

    Everyone needs estate planning. Children under the age of 18 are protected by their parents’ estate plan but everyone age 18 or older needs his or her own estate plan. Of course, estate plans vary immensely depending on goals, finances, family situation, domicile (where you live). There is no one-size-fits all estate plan.

    How much money do I need before an estate plan is necessary?

    You don’t need to be a Rockefeller or Kennedy to need an estate plan. In fact, you don’t need any assets to need an estate plan. What you do need is one of the following: 1. someone you love, 2. the desire to control your life and finances, 3. the desire to maintain privacy, or 4. the wish to avoid court interference.

    To help you think this through, here are non-monetary reasons to have an estate plan in place: 1. an estate plan empowers your trusted helpers to make healthcare decisions and manage your day-to-day business if you’re not able to; 2. appoints guardians for minor children and pets; and 3. avoids medical heroics through a living will.

    What happens if I don't have an estate plan?

    You actually do have an estate plan even if you haven't taken action to create your own personalized version. You may wonder, “How can that be?” If you don’t have an estate plan, the government has a plan for you - and, unfortunately, you probably won’t like it. For example, if you don’t create your own estate plan, the court will decide who raises your children and who handles your finances and private matters. And, state law will decide who inherits from you - but - it may not be who you think.

    Why do I need estate planning documents?

    Your estate planning documents may seem complicated, but they’re really just your instructions, legally documented, so those you select to help (trusted helpers) know what to do when. Many of our clients think of their estate planning documents as an instruction book. That’s all they are.

    How does my estate plan benefit me?

    As the question reflects, much about estate planning is providing for and protecting those you love. However, estate planning is not just death planning, it protects you while you’re alive as well by organizing your assets, establishing your goals, protecting assets, providing for you and protecting loved ones (including pets) during any period of incapacity, keeping you in control, and assuring that your wishes, including health care wishes, are carried out - and providing peace of mind that all will go as you wish. This is such a good question because it’s imperative that you keep assets in your trust if you want your estate plan to work. If you have asset titling questions, we’re always here to help.

    How do I get an estate plan?

    This is how your estate planning will work: You'll chat with us about your goals, fears, dreams, finances, and family and we help you craft an estate plan (i.e. instruction book) that includes the legal language required to carry out your plan. Even though some legal terms, descriptions, and language are required, please know that we make a sincere effort to write each estate plan in plain English, easily readable by your loved ones and trusted helpers. Your wishes of what you want to happen when, documented in legal form, are your estate plan.

    My child is legally an adult, should she have her own estate plan?

    Without a doubt, yes. Even an 18-year-old high school senior needs an estate plan. Once a child attains the age of 18, she is legally an adult and must make her own health care, financial, and legal decisions. Parents are powerless to act on behalf of their adult children without legal documentation.

    When do my children need to get their own estate plan?

    Everyone is surprised when we answer this question. Even an 18-year-old high school senior needs her own estate plan. Once a child attains the age of 18, she is legally an adult and must make her own health care, financial, and legal decisions. Without legal documentation, parents are powerless to act on behalf of their adult children.

    Of course an 18-year-old’s estate plan is very different from a 48-year-old’s estate plan because life, assets, goals, and family situation evolve over 30 years, but some basics are the same. How old do you need to be to have an estate plan?

    What do estate planning attorneys do?

    Estate planning attorneys take their clients’ wishes and turn them into legally enforceable documents. Through those documents, we empower our clients to carry out their goals, protect themselves and those they love, and stay in control. We listen and serve as counselors, guiding our clients and their loved ones for more than a lifetime - including during any period of disability and after death - into the next generation.

    Are probate attorneys and estate planning attorneys the same thing?

    In a nutshell, yes. You may see probate attorney, trusts and estates attorney, and estate planning attorney all referring to an attorney who both supports clients during their lifetimes and guides the family during disability and after death.

  • PROBATE

    What is probate?

    Probate is the process by which the court validates the authenticity of a will; appoints the executor (aka personal representative); and supervises the settlement of an estate, including the payment of bills, filing of tax returns, and transfer of assets to beneficiaries. If no will is presented, the court will appoint an estate representative, called an "administrator." The administrator carries out the same duties as an executor; the remainder of the probate process remains the same whether there was a will or not, except that estate assets are distributed to heirs at law as determined by the state's intestacy laws, not beneficiaries chosen by the testator (aka the deceased who created the will).

    Is probate bad?

    Many people, but not all, think so. The difficulty and expense of probate varies from state to state and from family to family because of differences in state laws, family goals and personalities, and assets. Many clients wish to avoid probate because it’s a public process, time consuming, and costly. We’ll take a look at your full situation together and let you know whether a probate avoidance plan should be part of your estate plan.

    Why should I avoid probate?

    Most people want to avoid probate because it can include high fees and costs, significant time delays and stress, and public dissemination of private information. What do I mean by public? Anyone can hop on the Internet and see a listing of your assets, debts, beneficiaries, and who got what. If you’re like most people, you want to keep your family affairs and finances private, so probate should be avoided.

    How do I avoid probate?

    Only assets in your individual name or payable to your estate will go through probate. Many folks use a (fully funded) revocable living trust to avoid probate. In addition, contract assets such as life insurance, retirement accounts, and annuities as well as assets owned by joint tenants with right of survivorship avoid probate as well.

    What is living probate?

    “Living probate” refers to the court process necessary if you don’t have a disability plan in place and become incapacitated. It’s also referred to as “guardianship” or “conservatorship,” depending on state law. For your loved ones, it’s often a painful, arduous, and public process. We’ve found that most folks also want to keep their family and financial affairs private with a disability plan instead of dredging through a public court proceeding. Fortunately, living probate can be easily avoided with powers of attorney and living trust planning.

    Will the state seize my assets if I don’t have a will?

    No. It’s a common fear, but no. If you die without a will, state law will determine who inherits. It’s only if you have no distribution provisions in a will as well as no living relatives that your assets will go to the state. Your long lost cousin Sal will inherit before the state.

  • ADMINISTRATION

    What is a disclaimer?

    A disclaimer is a legal “no thank you.” It’s you saying “no” to assets you’d have a right to inherit. Sounds odd, we know, but sometimes it makes good sense to disclaim property to take advantage of tax laws or new estate planning strategies.

    When would I use a disclaimer?

    From time-to-time, we advise surviving spouses to use a disclaimer (a legal “no thank you”) to pass an asset to the next beneficiary, which is often themselves or their children. This strategy is typically used to save tax dollars or get out from underneath outdated trust terms. Be sure to hear us out if we recommend a disclaimer. It’s always your decision in the end, but we promise we will never recommend it unless it’s in your best interests.

  • DISABILITY

    What does "disabled" mean?

    In the estate planning world, the term “disabled” refers to an individual’s incapacity or the inability to manage day-to-day business affairs such as managing and protecting assets, signing papers, paying bills, and filing taxes. “Disability” or “incapacity” doesn’t mean you’re laid up on the couch with a bad back; instead, it means that you don’t have the physical and mental capacity necessary to manage your personal business.

    How can I be sure to stay in control of my property if I become disabled?

    There are two options for maintaining control during a period of disability; and, often, we recommend the use of both: power of attorney and revocable living trust.

    Who will take care of my finances if I become disabled?

    Disability is the perfect example of why you need to appoint trusted helpers. If you have an up-to-date power of attorney, the named agent may be able to manage your finances, including paying your bills. Unfortunately, if you don’t have a legally documented disability/incapacity plan, your loved ones will battle it out in court and the judge will decide who’s in charge. Because power of attorney documents are often turned down, we use the belt and suspenders approach for many clients, including a trust with disability provisions.

    TIP: Be sure to name a contingent agent in case your primary agent is unable or unwilling to serve. The same with disability trustees. Be sure to name successor disability trustees in case your named trustees are unable or unwilling to serve when the time comes

    What if I don't have a family member who would be good at managing my assets if I become disabled?

    Fortunately, professional fiduciaries are available. In exchange for a fee, they will manage and protect your assets, pay your bills, and file your taxes should you become disabled (incapacitated) and unable to manage your day-to-day business affairs.

    What's a disability panel?

    A disability panel is often used to determine whether an individual in incapacitated for two reasons. On one hand, you may not realize that you’re incapacitated, and on the other hand, we don’t want you deemed incapacitated if you’re not. The panel usually consists of two or more people (whom you select to determine whether you’re incapacitated or not). If you’re deemed to be incapacitated, then your trust’s disability protections spring to life and your disability trustees are empowered to step in and help you by managing your assets, paying your bills, making sure all of your disability beneficiaries are provided for, and following any other instructions you’ve provided.

    Who will make healthcare decisions for me if I can't make those decisions myself?

    Your agent under your health care power of attorney has the power to make healthcare decisions for you if you are unable to make those decisions yourself.

    What is a healthcare power of attorney?

    As long as you are able to make your own healthcare decisions, you will continue to do so. But if tragedy strikes and you are unable to make those decisions, the trusted helper (i.e. health care agent) appointed in your health care power of attorney will make those decisions on your behalf.

    How do I avoid being kept alive by machines if I'm brain dead?

    A living will is used to avoid medical heroics such as life support at the end of life.

  • WILLS

    What is a will?

    Wills are legal documents which have a long history - not as long as the trust’s history - but long enough. You absolutely need a will to:

    Appoint an executor or personal representative

    2. Appoint guardians for any minor children

    3. Distribute assets titled in your individual name or payable to your estate

    If you don’t have a will, the court will decide who settles your estate and raises your children and state law determines who gets your assets - and it may not be who you think. Most people want to make those decisions themselves; don’t you?

    When is my will effective?

    Your will is only effective at your death. It has absolutely no power during your lifetime.

    When is my will filed at the courthouse?

    Your will should be filed at the courthouse soon after you die. No need to file anywhere before that time.

    Does my will control all of my assets?

    Your will only controls assets in your individual name or made payable to your estate. For example, if you own a bank account or house only in your name, it will pass by the terms of your will. However, if you own that same bank account or house in joint names with a spouse or someone else, your will will not control those assets. Another example: if your estate is named as the beneficiary of your retirement plan or life insurance, then your will will control those assets. But, if you named an individual as the beneficiary on the policy, the will will not control them.

    What's the difference between a living will and a will?

    These two documents, the living will and will, sound similar but they are very different in purpose. First, we’ll describe the living will; then, the will.

    The living will states that you don’t want medical heroics to be kept alive if you are in an irreversible coma or vegetative state, but that you want to be kept as comfortable as possible. The living will is effective during your lifetime and is considered an advanced medical directive because you’re making a medical decision in advance. Your health care agent, named in your health care power of attorney, must respect your advanced medical directives including your living will.

    The will does three things and is only effective after your death. Your will:

    1. Appoints an executor or personal representative

    2. Appoints guardians for any minor children

    3. Distributes assets in your individual name or payable to your estate

    How do I ensure that there isn't a will contest?

    We’ll need to change the question to “How can I best ensure there isn’t a will contest?” because we live in a litigious society and anyone can sue anyone for anything. But, don’t be discouraged. There’s a lot you can do to reduce the likelihood of a will contest. For example, don’t put your estate plan in a will which is a public document; instead, use a trust which is private so no one, but for named beneficiaries, will know what’s in your plan. Also, never use your estate plan to be mean. For example, don’t leave $1 to the sibling or child you don’t like. In addition, if you wish to disinherit a loved one who would normally inherit from you, state your wishes outright; don’t just leave him out of your plan. Lastly, if you have a blended family or anything other than an Ozzie and Harriet life, then let your loved ones know your plans ahead of time. Prepare and protect all those you love and let them know you’ve done so.

  • TRUSTS

    What is a trust?

    Technically, a trust is a contract containing your instructions so others know what you want to happen and how they can help you. Trusts have been used for hundreds of years; revocable living trusts have been popular for the last 40 years and are commonly part of a foundational estate plan.

    The revocable trust is easy; you serve as your own trustee and beneficiary during your your lifetime. Other trusted helpers (i.e. successor trustees) are appointed to jump in and help if: 1. you are incapacitated and aren’t able to manage your finances and day-to-day business and 2. if you've died.

    In addition to the revocable trust, there are many other kinds of trusts. Trusts are used to protect qualified retirement trusts, life insurance, and other assets. They are also used to reduce taxes and carry out charitable, family, education, and business goals.

    Can my trust be updated?

    If your trust is a revocable trust, as most are, you have the power to update it whenever you’d like (so long as you have the mental capacity to do so). Updates which add to an existing trust are called “amendments.” If the entire trust is updated, it’s called a “restatement.” Technically, irrevocable trusts are indeed irrevocable and can't be updated; however, trust protectors, modification provisions, and decanting allow us to update an irrevocable trust that is no longer meeting the trust maker's intent.

    Who needs to know I have a trust?

    We typically recommend that your loved ones and those you’ve named to serve as trustees, agents, and executors/personal representatives be told you have a trust, where your trust and other important papers are kept, and how to contact us. In addition, it’s essential that the institutions where you hold your assets such as banks and investment companies know you have a trust so your assets are titled properly.

    The trustee of my trust just isn’t working out. Can I change the trustee? I’m afraid I’m stuck because the trust is irrevocable. Please help!

    You may be in luck because most trust modifications we make involve changing the trustee. Unfortunately, we can only answer generally here because we don’t know the details of your trust or your individual situation, but, yes, often the trustee can be changed, even if the trust is irrevocable. Please call our office ASAP to get on the schedule; we’ll review your trust and let you know the best way to proceed.

    I set up a trust for my grandchildren years ago and everything has changed since them. Can I revoke that trust and start over?

    What you can do is “decant” your trust, meaning you can take the assets from the original trust and pour them into a new trust, with new and more favorable terms. Decanting essentially would give you the results you’re looking for.

    I’m the beneficiary of a trust set up by my spouse when she died. The tax laws have changed significantly since then. Do I have to go to court to change the terms of the trust?

    Not necessarily. The simplest way to modify the trust would be if there are provisions within the trust that allow a private modification. Look for “trust protector” provisions. If you’d like help interpreting your trust and get an overview of your options, we’d be happy to review the trust.

    How can I include my favorite charity in my estate plan?

    Our clients often include charities in their estate plans. You could provide an outright gift during your lifetime, purchase life insurance to benefit your charity, set up a charitable trust or donor advised fund, fund a gift annuity, or create your own private foundation. Or, simply, you could provide, in your will or trust, for a certain percentage of your estate or dollar amount to go to the charity. Fortunately, you have options and we’ll help you determine which option is a good fit for you.

    What's a protective trust?

    A protective trust is an irrevocable trust, usually for the benefit of someone you love, such as a spouse, child, or grandchild. This trust protects its assets while benefiting the beneficiary. This means trust assets can’t be seized in a lawsuit, divorce, bankruptcy, business failure, or medical crisis.

    Interestingly, a protective trust can also protect trust assets from the beneficiary’s own bad habits. For example, sometimes loved ones are spendthrifts, which means they’re bad at managing money and spend every dollar on frivolous expenses. And, unfortunately, sometimes loved ones suffer from addictions: gambling, drugs, alcohol, and the like. A protective trust can be set up to protect the beneficiary from himself by making assets available for living expenses, education, and medical needs, but not providing assets outright which could be used to fuel an addiction or be otherwise wasted.

    What is an AB trust?

    An AB trust is sometimes included in estate planning to take advantage of tax laws and provide asset protection, remarriage protection, and bloodline protection.

  • POWER OF ATTORNEY

    What is a power of attorney?

    It’s common to execute powers of attorney for healthcare, finances, real estate, and business purposes. Each has a separate, limited purpose. The gist is that a trusted helper (i.e. agent) is legally empowered to help you should you need or want help.

    1. A healthcare power of attorney empowers your agent to make healthcare decisions on your behalf if you are not able to make those decisions yourself.

    2. A financial power of attorney appoints your agent to make financial decisions and manage bills.

    3. A real estate power of attorney authorizes your agent to manage, buy, or sell real estate such as if your spouse will attend a real estate closing, but you will not.

    4. A business power of attorney grants your agent the power to make decisions related to your business such as if you are disabled or on vacation.

    When is my power of attorney effective?

    Well, that depends. Most powers of attorney are effective immediately, but others are springing powers of attorney. A “springing” power of attorney springs into action upon the occurrence of an event such as disability or event such as a vacation or semi-retirement. We'd be happy to review your power of attorney and let you know when it is effective.

    What's a springing power of attorney?

    Most powers of attorney documents are effective immediately upon signing; others are only effective and ready to use upon the occurrence of some event or a date. Powers of attorney that spring to life upon the upon the occurrence of some event (incapacity) or some date (such as September 16th or the date of the closing for the sale of 123 Main St.) are called “springing powers of attorney.”

    Where do I file my Power of Attorney?

    Your power of attorney isn’t filed anywhere. Unlike a will, a power of attorney isn’t filed anywhere public.

    WARNING: While you are alive and well, be sure the bank and investment company will honor your power of attorney. If not, sign theirs.

    Will the Social Security office accept my Power of Attorney?

    Often, financial institutions, including the government and the department of Social Security, want their own power of attorney signed. We’ll help you get the paperwork needed to deal with the departments of Social Security and Veterans Affairs.

    Will the bank accept my Power of Attorney?

    We don’t know. Sometimes institutions accept powers of attorney and often they don’t because they are concerned about their own liability. They get concerned that the document is too old, has been revoked, isn’t legally binding, or has been forged. Often, financial institutions, including the government and the department of Social Security want their own power of attorney signed. It’s imperative to find out now, while you can still sign additional legal documents, whether your power of attorney will be honored or you need to sign theirs. We’ll help you.

  • CHILDREN

    How can I best protect my children?

    So this is a question best answered in a personal conversation; however, we can nutshell general educational information here:

    Minor children need more protections than adult children but both will benefit from your thoughtful estate planning. It’s essential that you name guardians (and contingent guardians) for minor children in your will; also, be sure to name guardians/trustees of the funds you leave for them. Keep in mind that minor children cannot inherit outright so to avoid such provisions by using trusts. Adult children don’t need guardians but most do benefit from lifetime trusts which can protect their inheritances from a divorcing spouse, lawsuit, bankruptcy, business failure, addiction, and spendthrift spending.

    Do I need to update my estate plan to include my newborn?

    Yes, anytime you have a significant change in your family, your estate plan needs to be professionally reviewed for necessary changes. You may have provisions in your plan which would cover the child, but don’t take any risks.

    Guardians

    How do I name guardians for my children?

    Guardians for minor children must be named in a will. If you fail to appoint guardians in your will, the court will decide who raises your children. For parents of minor children, this is the most important estate planning decision you’ll ever make.

    Even though it’s hard and no one can raise your children as well as you can, move forward and select the guardians you think will muddle through the best. Some folks delay estate planning because they can’t make this decision. Don’t do that; your inaction puts your children at risk. And, be sure to name back up guardians as well in case your first choice is unable to serve if the time comes.

    What if the guardians I name for my children can't serve when the time comes?

    This is an important question that many folks forget to ask. It’s essential that you name contingent guardians in your will in case your primary guardians are unable or unwilling to serve if the time comes. Life does indeed change, so be sure to also indicate who get the kids if guardians divorce. Check in with the people you’d like to name to be sure they’re willing and able to serve.

    Should the same person I name as guardian for my children manage their trust?

    Lawyers often say, “it depends,” because it does. Sometimes the same folks are appropriate for both roles and other times, naming different people is the right thing to do. This is what we call a “counseling issue,” meaning that after we talk it through, you’ll know what decision to make. The people who care for your children day-to-day may or may not be the best fit to manage the finances as well. The responsibilities do require different skill sets.

  • INHERITANCES

    How can I keep my son-in-law from getting my daughter's inheritance?

    Using a protective trust with an independent trustee will best protect your daughter’s inheritance. If you choose to name your daughter as a trustee of her own trust, naming a strong, independent co-trustee and teaching your daughter to keep trust assets in the trust will add a strong layer of protection.

    How do I disinherit a child?

    Being disinherited is traumatic because it universally signals a lack of love and may cause discord between siblings and other family members for generations. Before you disinherit a child, we’d like to talk it through with you because there may be a better way. For example, some folks think they need to disinherit a disabled, spendthrift, addicted, or super successful child, but there are ways to both include your child in your estate plan and protect him at the same time.

    Should I disinherit my son? He's a drug addict.

    We understand your concern. But, no, you don’t need to disinherit your son, even if he suffers from addiction. You’re right to be concerned as giving your son money outright would likely fuel the addiction and may even kill him. We will help you best ensure that doesn’t happen. We’ll carefully craft language for a trust for his benefit, but never have the assets go directly to him. For example, an independent trustee will follow your instructions and pay the landlord or grocery store directly, but not make funds directly available. You get to decide how the funds will be used.

    How do I protect my children from my first marriage?

    We wish all parents asked this question. Many loving parents accidentally disinherit their children by owning property in joint names with a spouse who is not the parent of all of their children. If you have children from a previous relationship, it’s essential you work with us to protect your children - and your spouse. We typically use trusts to get your assets where you want them to go.

  • PETS

    Do I need to include my pets in my estate plan?

    Yes, absolutely, we can help you include your pets in your estate plan. Most of our clients feel as though their pets are family and need to be protected. You can make sure they are loved and cared for if, for any period of time, you cannot care for them yourself. For example, we can help you set up a simple pet trust and provide for companionship, vet bills, toys, and food.

    I have an estate plan but did not think to include my pet in it. Can I add a pet trust to my current plan, or do I need to set up a separate plan?

    We can easily amend your current estate plan to include a pet trust; in fact, most pet trusts exist as part of a larger revocable living trust-based plan. If you want or need a separate pet trust, we can certainly structure it that way, but most of our clients prefer us to include the pet component within their existing plan.

    What is a pet trust?

    A pet trust is used to appoint a trustee and caretaker to take care of your beloved pets if you can’t, such as during any period of incapacity and after death. The trustee makes sure all of your instructions are carried out and bills are paid; the caretaker provides loving care to your pet day in and day out.

    I am not sure how much money I need to appropriate for my pet trust. I want to make sure there is enough money without overdoing it. Can you help?

    We can certainly help! The specifics about how much money to leave for your pet will vary greatly depending on your specific circumstances, but we can will help you create an itemized list to ensure there is enough to cover everything. Factors to consider will include how long your pet is expected to live, the current costs for caring for your pet, costs for the caretaker/trustee, etc. As for any surplus, you can easily designate where any extra money goes after your pet passes on (for example, the extra could be donated to your favorite animal charity), so you can rest assured that any extra will go where you think best. Depending on the amount being set aside and your other assets, we can also work with your financial advisor to ensure that your pet trust is completely coordinated with your other financial objectives.

    My dog requires a very specific routine in order to feel safe and keep from getting anxious or sick. How can I be sure a caretaker will be able to keep my dog on her routine?

    Your pet trust includes instructions for care, and these instructions can be specific. If your dog needs to be fed a certain type of food at precise times of day, prefers a special toy, has a specific bedtime or needs to be walked three times a day in a specific park near your home, you can include all this information in the instructions. You should also talk with the person you plan to appoint as a caretaker and explain the situation, so he or she knows what to expect. You can even have your appointed caretaker tag along for a couple of days to get familiar with your dog’s routine.

  • ADMINISTRATIVE ROLES

    Who’s a trusted helper?

    A trusted helper is someone who helps you carry out your estate plan. Here are a few trusted helper examples: the health care agent who makes health care decisions for you if you are unable to make those decisions yourself; the agent under a power of attorney who pays your bills when you can’t or don’t want to; the guardian who cares for your children if you can’t; and the trustee who manages and protects assets. All trusted helpers must follow your estate plan instructions as well as the law. Don’t worry; we’ll guide your trusted helpers and help them carry out their duties.

    What is an administrator?

    An administrator is the person who settles an estate when no will has been found. You’ve likely heard the term “executor” or “personal representative.” Those titles are granted to the person who settles an estate under the terms of a will. The duties are the same: gathering and protecting property, paying legitimate bills, filing appropriate tax returns, and distributing assets to beneficiaries.

    What is an executor?

    An executor or personal representative is the person who settles an estate when someone dies with a will. An administrator is the person who settles an estate when no will has been found. The duties are the same: gathering and protecting assets, paying legitimate bills, filing appropriate tax returns, and distributing assets to beneficiaries.

    What does Personal Representative mean – is that different than an executor?

    A personal representative is the same as an executor. This is the individual or institution named in a will who becomes responsible for carrying out the instructions provided in your will during the probate process.

    What Does a Guardian Do?

    Guardians and conservators are court-appointed individuals who make decisions on a person’s behalf in the event of mental or physical incapacity. This can be avoided by adding proper powers of attorney, and explicit directions for them, to your estate plan.

    What is an agent?

    An agent is a trusted helper such as the health care agent under a healthcare or medical power of attorney as well as an agent under a general power of attorney. The agent is tasked with carrying out your instructions as described in your document as well as mandated by state law. We guide agents so they fully understand their responsibilities.

    What’s the difference between my health care agent and my financial agent?

    While there is some overlap, health care and financial agents are two distinct roles within an estate plan. Your health care agents, also referred to as health care powers of attorney or health care proxy, are responsible for making medical decisions on your behalf and may also implement your pre-arranged instructions if you experience incapacity. Likewise, financial agents can manage your wealth, pay bills, file taxes, purchase insurance, and adjust investments for you if you become unable to do so yourself. They may or may not be the same person; it’s up to you to decide who is best for each role.

    What does a successor trustee do?

    A successor trustee can be either an individual or an institution. This party serves as a back-up, or successor, to the original trustee in case the first trustee passes away or is incapable or unwilling to perform their duties regarding the management of your trust.

    Who should I pick as trustee?

    Trustees manage assets contained within a trust. To figure out how to select the right person for the job, first consider whether the trustee should be an individual or a financial institution. If choosing an individual, pick someone you know who is diligent and detail-oriented, and whom you trust to carry out your clear instructions.

    Should I Pick a Corporate Trustee?

    While it’s straightforward enough to pick a friend or family member you think will be up to the task, picking a corporate trustee is the best option for some people. Banks and trust companies that focus on trusteeship provide expert management. Being unrelated to your personal life, you can also rely on them to be impartial. However, corporate trustees do come at a cost.

    What is a trust protector?

    A trust protector is a trusted helper such as an estate planning attorney who ensures that your estate planning goals are carried out if the law or circumstances change, frustrating your original intent. A trust protector is empowered to update your trust without court interference or mandate to carry out your wishes. The trust protector keeps you, your family, and your estate plan out of court.

    What does a trust protector do? Do I need one?

    A trust protector’s duty is to make sure the trust maker’s intent is carried out. And, yes, we use trust protectors in all of our trusts to make sure changes in the law or changes in circumstances don’t frustrate the trust maker’s intent. The trust protector has the power to modify your trust to meet your wishes without hauling your loved ones into court.

    What is a trust officer?

    A trust officer works for a bank’s trust department and often manages financial planning, accounting, real property management, estates, and trusts. They often serve as personal representatives/executors, trustees, and agents under a power of attorney. They are not permitted to provide legal advice, and, therefore, work with estate planning attorneys like us.

  • FUNDING

    What does "funding" mean?

    Typically, the term “funding” refers to the transfer of assets into a trust. Funding is an essential and ongoing part of the estate planning process. If your estate plan isn’t properly funded, it won’t work, meaning it won’t do what you want it to do. Funding is an essential and ongoing part of the estate planning process.

    Why is funding important?

    Funding is an essential and ongoing part of the estate planning process. Typically, the term “funding” refers to the transfer of assets into a trust. If your estate plan isn’t properly funded, it won’t work, meaning it won’t do what you want it to do. Or, if you want your will to control distributions to your children, you must own those assets in your individual name.

    How can I be sure my trust stays funded?

    This is such a good question because it’s imperative that you keep assets in your trust if you want your estate plan to work. If you have asset titling questions, we’re always here to help. That support is included in your client maintenance membership. Also, be sure you come in for our annual meeting during which we’ll review your assets and make sure proper asset ownership has been maintained.

    Do I need to let my attorney know when I purchase a new asset?

    If you have asset titling questions, we’re always here to help. That support is included in your client maintenance membership. In addition, we’ll give you a card with the name of your trust so you can just hand that to the bank or investment advisor when you open a new account. You don’t need to worry about retitling any personal assets that don’t have a title such as new furniture, appliances, or roller skates.

    What does "proper asset ownership" mean?

    Proper asset ownership refers to aligning your assets with your estate plan. For example, if you want your trustee to be able to manage assets, those assets must be owned by your trust. Or, if you want your will to control distributions to your children, you must own those assets in your individual name. Proper asset ownership, sometimes referred to as “funding,” is an essential and ongoing part of the estate planning process.

    What does “tenants in common" mean?

    Tenants in common is a form of joint ownership in which the owners can own equal or unequal portions of the property. For example, Sally, Jane, and Sue own a beach house together as tenants in common. Sally is a 20% owner, Jane is a 30% owner, and Sue is a 50% owner in the beach house. There is no survivorship feature so when Sally dies in a boating accident, her 20% ownership in the beach house will pass to whomever she names in her will or trust (or by state law if there is not will or trust), not necessarily Jane and Sue.

    What is joint tenancy with right-of-survivorship?

    JTWROS is a form of joint ownership with a survivorship feature. Two or more people own an asset together and the survivor of them owns the property outright. For example, Joe and Sam own a house as joint tenants with a right-of-survivorship. Joe dies in a skiing accident. Now, Sam owns the house automatically by operation of law. There’s some “lawyer math” included in JTWROS. Each owner owns 100% of the property, no matter how many joint tenants there are, 2 or 20.

    Should I put my children's name on my bank account?

    No. We can help you authorize your children to help manage your assets and pay your bills. We can even help you avoid paying probate fees and reduce any transfer taxes, but, no, don’t put your children’s names on your bank accounts or house to avoid common problems such as horrid tax implications, creditor seizure, stealing, and family discord. We’d be happy to help you reach your goals with minimal risk.

    Do I have to name my spouse as the beneficiary of my retirement account?

    Yes and no. Yes, you can name someone else or a trust as the beneficiary of your retirement account. For example, some of our clients name their revocable trust as the beneficiary, but in order to do so, you must have your spouse’s written permission.

    What if I end up using up my retirement account during my lifetime?

    By all means, use your retirement funds as you think best. Even after you set up a standalone retirement trust, you’ll have full control and the right to enjoy your retirement funds for years. However, if you’re like most people, you will still have assets in your retirement account when you die; that’s when the SRT - standalone retirement trust - will protect your loved ones and their inheritance.

  • INSURANCE

    What insurances do I need?

    When we meet, we’ll discuss which insurances you need based on your goals, responsibilities, and opportunities. In general, all folks should consider homeowners, renters, disability, business interruption, life, auto, and umbrella insurances.

    Do I need disability insurance?

    Everyone needs estate planning. Children under the age of 18 are protected by their parents’ estate plan but everyone age 18 or older needs his or her own estate plan. Of course, estate plans vary immensely depending on goals, finances, family situation, domicile (where you live). There is no one-size-fits all estate plan.

    Do I need life insurance?

    Here are the general guidelines for life insurance: if you have someone who depends on your income for support, you need life insurance. Children, spouses, partners, pets, and parents are the most common examples of dependents. You may also need life insurance to fund a business buyout, equalize inheritances, or pay administration fees and taxes. Please come into the office for a chat, so we can let you know whether you and your individual situation calls for life insurance.

    When should I consider long term care insurance?

    It’s likely that you will need some kind of support during a period of disability or old age. If you purchase the right policy, long-term care insurance pays for care at home, in assisted living, and in a nursing home. It’s not fun to think about, we know; but, with costs of nursing homes well above $100,000 per year, many folks can’t private pay and Medicare won’t pay. If you’re married, you’d need to double that $100,000+ to $200,000+. Be sure to purchase a policy indexed for inflation as the example prices quoted are in today’s dollars, not dollars of the year you’ll need care. We work with trusted long term care insurance professionals all of the time and will help get the support you need.

    Who will inherit my life insurance?

    Life insurance is a contract and the insurance proceeds will be paid to whomever you named as the beneficiary of the contract. If you haven’t named anyone, the proceeds will flow into your estate and your will, if you have one, or state law, if you don’t have a will, will decide who gets what.

    Should my life insurance be in a trust?

    This is one of those “it depends” questions. It’s impossible to answer without knowing your goals and family and financial situation - and - of course - having a client/attorney relationship. Sometimes, it’s appropriate to have a trust owned life insurance and, sometimes, it’s unnecessary. Please call the office to get on the calendar so we can give you advice specific to your individual situation.

    What's an ILIT? (Irrevocable Life Insurance Trust)

    An ILIT is an irrevocable trust that applies for, owns, and maintains life insurance. It’s purpose is to get life insurance cash value and proceeds out of an estate for federal estate tax and generation-skipping tax purposes. Often, life insurance is purchased to equalize inheritances, provide an inheritance, fund tax bills, pay expenses, fund a buy-sell agreement, or benefit a charity. The ILIT does all that without increasing taxes. Sometimes, an ILIT is used with a CRT (Charitable Remainder Trust) which provides an income stream to pay the life insurance premiums and benefits your favorite charity.

  • ASSET PROTECTION

    What is asset protection?

    Asset protection prevents your assets such as bank accounts, real estate, retirement plans, businesses, and investment accounts from being seized by creditors in a lawsuit. Today, everyone has the lawsuit bullseye on his back, so we all need asset protection.

    Do I need asset protection?

    Everybody needs asset protection. In it’s simplest form, you likely already have some level of asset protection in that you have car insurance and, maybe, life insurance. Most of our clients need additional asset protection as well.

    Why would my loved ones need asset protection?

    Lawsuits are filed every few seconds all year long, every year, in the United States. We all have a bullseye on our back. Commonly, lawsuits stem from car accidents, business failure, divorce, malpractice, tenants, slip-and-falls, bankruptcy, and the like. Without your protection, inherited assets can be seized.

  • BENEFICIARIES

    How can I make sure my spouse doesn't give his inheritance away?

    Many of our clients prefer to give their spouses inheritances in trust, rather than outright. Trusts provide asset protection, bloodline protection, remarriage protection, and guidance which will prevent your spouse from giving his inheritance away.

    I feel as though I’m always battling with my deceased husband’s children as they are the remainder beneficiaries of my trust. I hate having to ask for distributions. What can I do?

    This may be a good case to have the trust converted to a unitrust, so monthly payments are guaranteed and conflict is reduced. That being said, we wouldn’t want you to give up your right to principal if you need it. Let’s talk about it.

    How do I balance the interests of my children and my spouse from a second marriage?

    We’ll help you set up a loving estate plan that protects and provides for whomever you’d like - often that’s children and, sometimes, a second or third spouse. Your estate plan, likely including trusts, will be carefully crafted to balance the interests of your children as well as your spouse. Without proper planning, too many parents accidentally disinherit their beloved children and cause havoc in blended families.

    How do I include my grandchildren in my estate plan?

    You can include your grandchildren in your estate planning in a myriad of ways. Some grandparents fund 529 Plans to help with college expenses. Others gift sentimental personal property; create trusts during their lifetime or after their death; or pay for ballet, music, or leadership lessons right now. We’ll help you figure out the best way to include grandchildren in your estate plan. Regardless of the size of the gift, it’s kind and loving to include those you love.

    Should I disinherit my disabled grandchild?

    No. You don’t have to do that. We can show you how to provide an inheritance for your disabled grandchild, but not disqualify her from receiving governmental assistance. We’ll craft special trust language so she benefits, not the government.

    Should I name my children as trustees of each other's trusts?

    No. Naming children as trustees of each other’s trusts is a recipe for family feud and disaster. We can help you select trustees of your children’s trust - often your children with a professional trustee.

  • TAXES

    The federal estate tax doesn't affect me; do I need an estate plan?

    Yes, you do need an estate plan even if the tax dog won’t bite. Often the fear of taxes or probate fees get clients in the door, but what they learn once they’re part of our community is that only a small part of estate planning is about taxes and fees. Estate planning is really about creating your legacy, including protecting and providing for you, your loved ones, and your property; staying in control; and offering guidance.

    Are my children's 529 Plans taxable in my estate?

    We have good news: your children’s 529 Plans are not taxable in your estate for federal estate tax purposes, yet you can remain in control of those assets. These dual benefits are very rare as, typically, if you have control over an asset, it is considered to be part of your estate for transfer tax purposes.

    Do estate planning attorneys help reduce capital gains taxes?

    Capital gains are an income tax - and, yes, income tax planning is a part of many, but not all, estate plans. When we learn more about your family, goals, and finances, we’ll let you know if you have an income tax planning opportunity.

    What's GST? (Generation Skipping Tax)

    The government seeks to tax the transfer of wealth at every generation. If you try to pass too much wealth to your grandchildren or folks younger than you by more than 37.5 years, the government imposes a generation skipping tax which when combined with the federal estate tax is confiscatory. Estate planning attorneys are very good at working around such taxes when families plan in advance.

  • TERMS

    What are contract assets?

    Trusts, annuities, life insurance, and retirement plans are all contracts, so trust assets, annuity funds, insurance value and proceeds, and retirement funds are all contract assets. It’s imperative that you name a beneficiary for each and every contract asset because they are not controlled by your will or trust, they’re controlled by the contract itself.

    What is a beneficiary designation?

    If you own life insurance or invest in a retirement plan, you’ll be asked to document who you want to receive the proceeds at your death. That documentation is a beneficiary designation - you’re designating who gets the asset after you.

    What is a bypass trust?

    A bypass trust, also known as a “B Trust” or “Family Trust,” is typically a trust set up to hold assets up to the federal estate tax exclusion amount (now more than $5 million) for the benefit of the family. The trust can be created with asset protection features so funds can’t be seized by creditors.

    What is an SRT?

    A standalone retirement trust, “SRT” for short, is a trust used to provide asset protection and maximized tax deferred growth for spouses, children, and other loved ones. This means more assets go to the people you care about.

    What's a CRT? (Charitable Remainder Trust)

    A CRT is an irrevocable trust used to reduce income tax, provide an income stream, and benefit a charity. The creator donates assets (usually highly appreciated assets) into a charitable trust and, thereby, benefits by reducing income taxes, qualifying for a charitable donation income tax deduction, and being recognized for benefiting a charity immediately even though the gift itself is postponed. The CRT’s income stream is paid out for an individual’s lifetime or a period of years. Then, at the end of that time, the charity receives remaining trust assets.

    What's an ILIT? (Irrevocable Life Insurance Trust)

    An ILIT is an irrevocable trust that applies for, owns, and maintains life insurance. It’s purpose is to get life insurance cash value and proceeds out of an estate for federal estate tax and generation-skipping tax purposes. Often, life insurance is purchased to equalize inheritances, provide an inheritance, fund tax bills, pay expenses, fund a buy-sell agreement, or benefit a charity. The ILIT does all that without increasing taxes. Sometimes, an ILIT is used with a CRT (Charitable Remainder Trust) which provides an income stream to pay the life insurance premiums and benefits your favorite charity.

    What is an FLP?

    An FLP or family limited partnership is an entity used in estate planning to organize, gift, and protect assets as well as reduce transfer taxes.

    What is an LLC?

    A limited liability company (LLC) is an entity commonly used to own and operate a business with relatively easy set-up, operation, and taxation. The LLC has two levels of asset protection: protection of LLC assets from outside creditors and protection of outside assets from internal LLC liabilities. The LLC is commonly used in estate planning for asset protection purposes; the LLC also serves as a popular business entity.

    What is portability?

    Portability is a term used to describe the tax law that allows a surviving spouse to use her deceased spouse’s unused federal estate tax exclusion. However, there is no portability for the generation skipping tax exclusion and portability is only available if the 706 (federal estate tax form) is filed in a timely manner at the death of the first spouse to die. In addition, most states do not allow portability for state estate tax exclusion, so portability is a nice option to have, but not a save all provision.

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