When You’re Gone: 7 Tasks an Estate Planning Lawyer Will Handle for You
Estate planning is something everyone, no matter how young or old, rich or poor, needs to participate in sooner rather than later. Planning your estate is the act of deciding where your assets, both those big and small, will go when you pass away. To avoid confusion and hurt feelings of those closest to you, the time for planning is now. An estate planning lawyer is whom to call on for easy and stress-free arrangements. Your loved ones will thank you for preparing before you leave this earth.
There are seven basic tasks an estate planning lawyer will handle for you:
- Prepare a Will;
- Help to Eliminate or Reduce Estate Taxes;
- Prepare a Power of Attorney;
- Consolidate all Accounts, like Retirement, Savings, Brokerage, Business, and Personal and Debit, into Trusts;
- Prepare a Living Trust;
- Prepare Transfer of Personal Property to your loved ones or organizations you support;
- Generate Revocable, Irrevocable and other Special Trusts.
Let’s look at each task individually.
Prepare a Will
A will, or “last will and testament,” is a signed document, which an estate planning attorney can prepare, and is part of your wishes for your passing. Your will includes directives for all of your assets, including your personal and real estate property. A will can also communicate to your loved ones where your children (and/or pets) are to go if they are minors at the time of your passing. A living will can be added to protect you and your family in the case of a disabling event.
Help to Eliminate or Reduce Estate Taxes
Taxes can take a large portion of your estate. An estate planning attorney will help you to reduce or eliminate estate taxes, saving your beneficiaries money. Estate taxes and inheritance taxes are two ways your assets could be reduced. This is a complicated matter in which property value at the time of your death and at the time of planning are considered. Taxes are levied by both the federal government and individual states. An estate planning attorney would know the laws as outlined by the Internal Revenue Service (IRS) and how to employ certain strategies to pass along your assets without taxes.
Prepare a Power of Attorney
A critical part of estate planning is to designate a power of attorney. This gives a person (or persons) of your choosing the power to make decisions on your behalf, either after your passing or in case of disability. This person is also called an “agent”.
The power granted could be limited to a single act, like the sale of your property, or general to include all of the tasks needed to close out your financial and personal plans. This power could also cover medical decisions in case of your becoming incapacitated.
This is an important part of estate planning because you make your intentions known before anything happens and, therefore, no one has to guess and stress about what you may have wanted.
Consolidate all Accounts into Trusts
An older individual may have several different types of accounts. Retirement, savings, personal, brokerage and business accounts each have different laws and regulations when it comes to consolidation and/or distribution to heirs. If you own a business, this could complicate the estate planning process even further.
An estate planning attorney studies these protocols and knows how to use them to best benefit your plan. Setting up trust accounts allows your heirs to transfer assets without major taxation.
Transfer of Personal Property to your Loved Ones or Organizations
Many times, an individual will want to leave an organization or group all, or part, of their assets. When an estate planner lays this wish out in an official document, it is less likely to be contested by family and others who feel they should have been the recipients of your remaining funds.
If there is a particular cause you are passionate about, like animal welfare, children, or health issues, you can set up your will or a trust to make sure a certain organization will benefit from your generosity.
Prepare a Living Trust
There is no monetary limit for someone to set up a trust account. You do not have to have an abundance of money to ensure an estate planning attorney will create a trust for you. A trust can be set up to deliver a single valuable asset, a group of assets, or something you want to block from going through probate. The probate court is avoided when you create a will, a trust, or any type of estate plan that spells out your wishes in an official document. The probate court is used to decide where your assets will go if you have not utilized the services of an estate planner.
Generate Revocable, Irrevocable and other Special Trusts
To protect your loved ones as they grow older, setting up a revocable trust is recommended by expert estate planning attorneys. This type of trust avoids income taxes which can be added to certain trusts and can be revoked, or taken away, as well as modified as the person ages. This type of trust remains private and turns irrevocable upon the death of the grantor.
An irrevocable trust is typically set up for tax concerns. All incidents of ownership are removed from the grantor, especially the taxable portion of an estate.
Another benefit of this type of estate planning is to protect the beneficiary. A trust allows for a slower distribution of funds. You, as the grantor, can decide how and when the funds are distributed. This will help when the individual being entrusted with a large sum of money does not allow access for spending the resources all at once.
No matter your worth, planning for the future using an estate planning attorney will save you time and money. Your loved ones, and any organization or association you are leaving your assets to, will thank you for thinking ahead and planning for their future.