ESTATE PLANNING CHECKUP
How’s the health of your estate plan?
Answer the following questions for a quick check up.
1) Do you have a will?
2) Do you have a Living Trust?
3) Do you have a plan in place to prevent your becoming a ward of the court if you were to become disabled and unable to manage your own affairs?
4) Do you have a Living Will and a Durable Power of Attorney for Health Care Decisions?
5) Have you nominated your choice of who would care for your children in the event you die before your children reach age 18 (if you fail to do so, the court will make that determination without your input)?
6) If you die before your children reach 18, unless you make other provisions, your children will receive all your property when they reach 18. If this were to occur do you think they would have the maturity to make wise financial decisions?
7) If you have a large estate do you have a plan to minimize or avoid Estate Taxes?
8) Do you have a plan in place to avoid your estate going through probate (a process that generally takes 6 to 9 months)?
9) If you have an estate plan in place, has it been reviewed by your attorney within the last three years?
If you answered “no” to one or more of the above questions, you should talk to an attorney about developing an estate plan that will be tailored to your needs. If you answered “yes” to all questions, we urge you to periodically review your plan with your attorney. This checkup is not intended to offer legal advice. If you have any questions regarding any of the questions above we urge you contact us for an appointment to discuss your specific situation. See below for further discussion of each of the above questions.
1) Do you have a will? Even if you have a plan in place to avoid probate we generally recommend having a will as a backup in case probate is required. Generally it is easier and less expensive to go through probate with a will as compared to without a will. In addition, without a will or other plan, your property may not pass to the persons you desire. For more information, click here.
2) Do you have a Living Trust? We consider the living trust to be the tool of choice in the majority of cases in which the client desires to avoid probate. This extremely flexible tool offers may advantages, including time and cost, and because of its flexibility can be tailored to meet the needs of nearly every client. For more information about trusts click here.
3) Do you have a plan in place to prevent your becoming a ward of the court if you were to become disabled and unable to manage your own affairs? Even more important that planning for your eventual death is planning for the possibility of disability. If for some reason you were to become unable to manage your affairs what would happen. Injury, illness or age can leave you unable to transact your day to day business and look after your property and finances. Absent some other provision, it may be necessary to go to court and have a conservator appointed to act on your behalf. While it is sometimes desirable to have the limits and supervision that comes with a conservatorship, it is often more cumbersome and expensive than other options. Almost every estate plan we prepare includes a durable power of attorney in which you appoint an agent to act for you if you become disabled. A Living Trust is also a very good substitute for a conservatorship and we often use this in addition to a durable power of attorney. For more information, click here.
4) Do you have a Living Will and a Durable Power of Attorney for Health Care Decisions? Just as you may need a conservator if you become disabled you may need a guardian in the case of disability. A guardian is appointed by the court to make decisions regarding your physical care and health. Because it is necessary to have a guardian appointed by the court it is more cumbersome and expensive to establish a guardianship as opposed to making use of a Durable Power of Attorney for Health Care Decisions. With this document, the agent appointed by you is empowered to act on your behalf if you are unable to do so. Your agent can consent to or refuse medical treatment on you behalf and make all necessary arrangements for your care. We recommend this document as a part of all of our estate plans. We also recommend the use of a Living Will or advance directive if you desire. This document provides guidance in the event you have a terminal condition or a condition from which you are unlikely to recover. In this document you can direct that in such event treatment be withheld and you be allowed to die. If you do not want treatment in such cases we strongly recommend the use of a Living Will but leave the decision to each client. For more information, click here.
5) Have you nominated your choice of who would care for your children in the event you die before your children reach age 18 (if you fail to do so, the court will make that determination)? If you have children under the age of 18 you should consider this question. If you were to die before they become adults it will be necessary to have a guardian appointed. The guardian is the person that will have actual physical custody and control of your child or children. The guardian is appointed by the court and the court will follow your wishes as to who to appoint as guardian (assuming you are not nominating an unsuitable person). You can nominate who will serve as guardian in your will or trust and we consider this an essential part of every estate plan for persons with minor children. For more information, click here.
6) If you die before your children reach 18, unless you make other provisions, your children will receive all your property when they reach 18. If this were to occur do you think they would have the maturity to make wise financial decisions? Who will handle the money for your children? A conservator can be appointed by the court to take care of any property or money that passes to a minor child on your death. Just as with the guardian, you can name who you would like to serve in this capacity. While we strongly recommend that you name a conservator for your children in your will we also recommend you not stop there. Property held in a conservatorship will generally pass to the children when they reach age 18. At that point it will be their property to do as they wish. Will they spend it wisely or have fun? For this reason we prefer to see the money be held in a trust rather than a conservatorship. The trust can continue long enough for the child to complete his or her education, ensuring the money is spent for education rather than more frivolous pursuits. The trustee can pay for school, housing etc.... until the child reaches the age you specify, often 21 or 25 years. For more information, click here.
7) If you have a large estate do you have a plan to minimize or avoid Estate Taxes? Recent changes in the law have a dramatic impact on necessary tax planning. Kansas no longer has an estate tax and the Federal estate tax now applies to estates in excess of $5,000,000. Spouse can shelter up to $10,000,000 without the complex trust structures that were required in the past. Because of these changes, plans that were previously put into place may no longer fit your need and may need to be reviewed.
For purposes of the estate tax virtually all property you own, along with the face value of life insurance, is counted to determine if your estate will be subject to the estate tax. If your estate may be subject to estate tax you may need to consider specialized planning to minimize or eliminate any estate tax liability. If you are near or over the threshold you should consult an attorney that deals with tax planning and continue to review your situation on an ongoing basis.
8) Do you have a plan in place to avoid your estate going through probate (a process that generally takes 6 to 9 months)? A common misconception is that having a will avoids probate. The contrary is true; relying on a will alone virtually guarantees your estate will need to go through probate. This process takes time and expense that may not be necessary. In addition to Living Trusts there are other devices that can avoid probate. In all of our consultations regarding estate planning we discuss appropriate methods of avoiding probate and work with the client to tailor the plan to best fit the client's individual situation. Our goal is to devise a strategy that will minimize the time, cost and inconvenience to your heirs and beneficiaries. For more information.
9) If you have an estate plan in place, has it been reviewed by your attorney within the last three years? Over time your personal financial and family situation may change. Laws may change. As a result what was an appropriate estate plan at one time may not be appropriate any longer. We generally recommend you review your plan every three years, preferably with an attorney of your choosing. The attorney can assist you in assessing whether any changes in your plan are advisable. Even if no changes are needed you will have the peace of mind in knowing that your plan is current and will meet the needs of you and your family were the need to arise.
How’s the health of your estate plan?
Answer the following questions for a quick check up.
1) Do you have a will?
2) Do you have a Living Trust?
3) Do you have a plan in place to prevent your becoming a ward of the court if you were to become disabled and unable to manage your own affairs?
4) Do you have a Living Will and a Durable Power of Attorney for Health Care Decisions?
5) Have you nominated your choice of who would care for your children in the event you die before your children reach age 18 (if you fail to do so, the court will make that determination without your input)?
6) If you die before your children reach 18, unless you make other provisions, your children will receive all your property when they reach 18. If this were to occur do you think they would have the maturity to make wise financial decisions?
7) If you have a large estate do you have a plan to minimize or avoid Estate Taxes?
8) Do you have a plan in place to avoid your estate going through probate (a process that generally takes 6 to 9 months)?
9) If you have an estate plan in place, has it been reviewed by your attorney within the last three years?
If you answered “no” to one or more of the above questions, you should talk to an attorney about developing an estate plan that will be tailored to your needs. If you answered “yes” to all questions, we urge you to periodically review your plan with your attorney. This checkup is not intended to offer legal advice. If you have any questions regarding any of the questions above we urge you contact us for an appointment to discuss your specific situation. See below for further discussion of each of the above questions.
1) Do you have a will? Even if you have a plan in place to avoid probate we generally recommend having a will as a backup in case probate is required. Generally it is easier and less expensive to go through probate with a will as compared to without a will. In addition, without a will or other plan, your property may not pass to the persons you desire. For more information, click here.
2) Do you have a Living Trust? We consider the living trust to be the tool of choice in the majority of cases in which the client desires to avoid probate. This extremely flexible tool offers may advantages, including time and cost, and because of its flexibility can be tailored to meet the needs of nearly every client. For more information about trusts click here.
3) Do you have a plan in place to prevent your becoming a ward of the court if you were to become disabled and unable to manage your own affairs? Even more important that planning for your eventual death is planning for the possibility of disability. If for some reason you were to become unable to manage your affairs what would happen. Injury, illness or age can leave you unable to transact your day to day business and look after your property and finances. Absent some other provision, it may be necessary to go to court and have a conservator appointed to act on your behalf. While it is sometimes desirable to have the limits and supervision that comes with a conservatorship, it is often more cumbersome and expensive than other options. Almost every estate plan we prepare includes a durable power of attorney in which you appoint an agent to act for you if you become disabled. A Living Trust is also a very good substitute for a conservatorship and we often use this in addition to a durable power of attorney. For more information, click here.
4) Do you have a Living Will and a Durable Power of Attorney for Health Care Decisions? Just as you may need a conservator if you become disabled you may need a guardian in the case of disability. A guardian is appointed by the court to make decisions regarding your physical care and health. Because it is necessary to have a guardian appointed by the court it is more cumbersome and expensive to establish a guardianship as opposed to making use of a Durable Power of Attorney for Health Care Decisions. With this document, the agent appointed by you is empowered to act on your behalf if you are unable to do so. Your agent can consent to or refuse medical treatment on you behalf and make all necessary arrangements for your care. We recommend this document as a part of all of our estate plans. We also recommend the use of a Living Will or advance directive if you desire. This document provides guidance in the event you have a terminal condition or a condition from which you are unlikely to recover. In this document you can direct that in such event treatment be withheld and you be allowed to die. If you do not want treatment in such cases we strongly recommend the use of a Living Will but leave the decision to each client. For more information, click here.
5) Have you nominated your choice of who would care for your children in the event you die before your children reach age 18 (if you fail to do so, the court will make that determination)? If you have children under the age of 18 you should consider this question. If you were to die before they become adults it will be necessary to have a guardian appointed. The guardian is the person that will have actual physical custody and control of your child or children. The guardian is appointed by the court and the court will follow your wishes as to who to appoint as guardian (assuming you are not nominating an unsuitable person). You can nominate who will serve as guardian in your will or trust and we consider this an essential part of every estate plan for persons with minor children. For more information, click here.
6) If you die before your children reach 18, unless you make other provisions, your children will receive all your property when they reach 18. If this were to occur do you think they would have the maturity to make wise financial decisions? Who will handle the money for your children? A conservator can be appointed by the court to take care of any property or money that passes to a minor child on your death. Just as with the guardian, you can name who you would like to serve in this capacity. While we strongly recommend that you name a conservator for your children in your will we also recommend you not stop there. Property held in a conservatorship will generally pass to the children when they reach age 18. At that point it will be their property to do as they wish. Will they spend it wisely or have fun? For this reason we prefer to see the money be held in a trust rather than a conservatorship. The trust can continue long enough for the child to complete his or her education, ensuring the money is spent for education rather than more frivolous pursuits. The trustee can pay for school, housing etc.... until the child reaches the age you specify, often 21 or 25 years. For more information, click here.
7) If you have a large estate do you have a plan to minimize or avoid Estate Taxes? Recent changes in the law have a dramatic impact on necessary tax planning. Kansas no longer has an estate tax and the Federal estate tax now applies to estates in excess of $5,000,000. Spouse can shelter up to $10,000,000 without the complex trust structures that were required in the past. Because of these changes, plans that were previously put into place may no longer fit your need and may need to be reviewed.
For purposes of the estate tax virtually all property you own, along with the face value of life insurance, is counted to determine if your estate will be subject to the estate tax. If your estate may be subject to estate tax you may need to consider specialized planning to minimize or eliminate any estate tax liability. If you are near or over the threshold you should consult an attorney that deals with tax planning and continue to review your situation on an ongoing basis.
8) Do you have a plan in place to avoid your estate going through probate (a process that generally takes 6 to 9 months)? A common misconception is that having a will avoids probate. The contrary is true; relying on a will alone virtually guarantees your estate will need to go through probate. This process takes time and expense that may not be necessary. In addition to Living Trusts there are other devices that can avoid probate. In all of our consultations regarding estate planning we discuss appropriate methods of avoiding probate and work with the client to tailor the plan to best fit the client's individual situation. Our goal is to devise a strategy that will minimize the time, cost and inconvenience to your heirs and beneficiaries. For more information.
9) If you have an estate plan in place, has it been reviewed by your attorney within the last three years? Over time your personal financial and family situation may change. Laws may change. As a result what was an appropriate estate plan at one time may not be appropriate any longer. We generally recommend you review your plan every three years, preferably with an attorney of your choosing. The attorney can assist you in assessing whether any changes in your plan are advisable. Even if no changes are needed you will have the peace of mind in knowing that your plan is current and will meet the needs of you and your family were the need to arise.
