What is a Will (also known as Last Will & Testament)?
A Will is a document signed by a person directing the distribution of his property upon death. Changes can be made at any time during a person’s life. You will work with our attorneys to answer some of the following questions in the design of your Will:
1. How will I provide for my heirs?
2. Who will be my executor?
3. Should I leave my assets outright to young people or in trust?
4. Who will be the Trustees of trusts for my children or other beneficiaries?
5. How can I minimize estate taxes under my will?
What is an Executor?
The Executor (known as personal representative in some states) is the person appointed in a Will to be in charge. The Executor’s job is to collect the property of an estate, pay expenses and debts of the estate and follow the instructions in the Will.
What is a Revocable Trust and when is it appropriate?
A Revocable Trust (also known as a living trust, loving trust or inter vivos trust) is a Trust created during your lifetime. It is a Will substitute and like a Will, can be changed at any time. After a Revocable Trust has been created, all of your property will then be transferred to the Trust. Upon death, the Trust will direct the distribution of your property in the trust, similar to a Will. Some of the advantages of a Revocable Trust include the following:
1. Avoid costs and delays of probate
In some states, probate can be an expensive and time consuming process. If there are minor children, a beneficiary under disability, missing heirs, heirs that may contest a Will, a revocable trust can avoid the additional expense and costly delays of a probate proceeding.
2. Avoid Court Appointed Guardian
A growing number of older Americans are putting their assets into a Living Trust because they want to avoid the appointment of a court-appointed Guardian if they become unable to manage their affairs. Transferring assets to a Trust avoids the complications of going to Court and having a Guardian appointed. The Trustee could then take any action necessary to sell the property.
Another advantage of a Revocable Trust is privacy. Once a Will is filed in Court in a probate proceeding it is a public record, which means that it is available for inspection by the general public. Thus, it is generally felt that the use of a Trust, which is not subject to probate, will afford a measure of privacy.
4. Avoids Ancillary Probate
In the event that a person owns real property in more than one State, an Ancillary Probate proceeding would be required in each State. Transferring real property to a Revocable Trust during one’s lifetime may avoid Ancillary Probate because the real estate would be owned by the trust and would pass in accordance with its terms.
What is an Irrevocable Trust and when is it appropriate?
There are many types of Irrevocable Trusts. They are generally used to minimize estate taxes, access government benefits and protect assets. An Irrevocable Trust cannot be changed (with some exceptions). The creator transfers his ownership of property to the trust. An Irrevocable Trust can be created during life (inter vivos trust) or upon death (testamentary trust). An Irrevocable Trust offers tax shelter benefits, which a revocable trust does not.
Today’s Irrevocable Trusts come with provisions that were not part of older versions of these instruments, and provide greater flexibility in management and distribution of assets. Provisions such as decanting, which allows a trust to be transferred into a newer trust with more advantageous terms. Other features include the ability to remove and replace a trustee without cause.
At the Law Office of Audra E Dehan, our Wills and Trusts planning practice is marked by sensitivity to the personal significance and importance of the process for an individual or family. We work as a team with insurance and accounting professionals to design a comprehensive estate plan for our clients ranging from young families to high net worth individuals. Special care and attention is given to seniors with elder law issues in addition to families with special needs. We are also experienced in gift & estate tax planning and the preparation of returns, as well as corporate and individual tax planning.