Wills
A typical disposition of a moderately sized estate can be handled with a Will. Even a person with a small estate can benefit greatly from having a Will because it makes clear what your wishes are and allows for a means of honoring them.
A Will can include a self-proving affidavit that, in most cases, avoids the need to bring witnesses to court after death. You can also name or designate your:
- Personal Representative: the person who carries out your wishes once you have passed away
- Guardians for minor children if neither you or the child’s parent survives
- Trustees for assets passing to minor children. When leaving gifts to children under eighteen years old, a testamentary trust can be useful in avoiding the cost and burden of a financial guardianship for that child’s share.
Trusts
There are many types of Trusts. Some you may have heard of are:
Revocable or irrevocable living trusts may be something you wish to consider if you desire privacy, own property in multiple states or hope to avoid probate altogether.
Certain trusts may be useful in saving federal estate taxes (inheritance taxes). These trusts are often used in a married couple scenario, allowing the shelter of a large estate from federal estate taxes. Failure to use them can leave families paying large amounts of taxes unnecessarily.
The special needs trust is a useful device when you have a desire to leave money for the benefit of a person with a disability without interfering with their government benefits such as Medicaid. This type of trust allows the person to have many of the extras that the government will not otherwise pay for. A knowledgeable elder law attorney can assist in creating management trusts for personal injury awards or other assets. These trusts help preserve the client’s qualification for Medicaid or other forms of public assistance.
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Frequently Asked Questions about Wills and Trusts
Q. I was told that the only way to go is to put everything into a trust, is that true?
A. Trusts can be a useful tool in the right circumstances. But, there are times when a trust is more than you need, like getting a heavy fur coat when the temperature will only go down to 50 degrees.
A Trust might be a neat thing to have, but is unnecessary and much more than called for under the circumstances.
Yet, that fur coat would be great for someone who will be out in -10 degree weather. It is important to discuss your situation with a qualified attorney in order to determine whether a trust is appropriate for your circumstances.
Q. If I do not make a Will does my estate go to the state?
A. Most often, no. Usually, it will go to relatives. But law, not you, decides which relatives your estate will go to. By preparing a Will, you can make sure you are choosing where your assets go, or to whom they are given, after you die.
Q. Now that I live in Florida, is my Will from another state still good?
A. An attorney cannot answer this question without first reviewing your Will and other estate planning documents.
Q. How can I avoid probate, and should I?
A. Many people want to avoid probate. Typically this is due to misconceived ideas regarding the probate process.
Probate can be avoided if ALL assets are in a Trust, are titled with joint tenancy with right of survivorship or have beneficiary designations. BUT, these kinds of plans can cause problems. Some problems with joint tenancy or designated beneficiaries are people may not die in the expected order of death, there is no protection for minors of beneficiaries not capable of managing property, and for real estate stocks, bonds and some other assets, you lose some control of the asset. If the joint tenant has creditor problems, files bankruptcy, gets a divorce, or gets sued, then the joint tenancy assets may be at risk.
An example of problem with designating beneficiaries:
Mom puts all four of her children on her bank accounts, Certificates of Deposit, etc. One child dies before Mom. That child’s survivorship rights terminate, and when Mom dies, the surviving children get everything. The children of the deceased child (Mom’s grandchildren) have been disinherited.
Q. Is all property subject to a Will or Trust?
A. Property held jointly is usually not subject to a Will until the last surviving joint owner dies. Life insurance, IRAs, profit sharing plans, etc. frequently are payable to a named beneficiary(ies) and are NOT controlled by or subject to a Will or Trust.
