Trusts & Estates

In brief, estate planning is a process used to assist you in developing and implementing a plan for your financial, medical, and personal affairs.  Estate planning is particularly crucial for the elderly and for individuals with disabilities because the need to provide for long-term care and other services introduces additional, often competing, considerations. However, LawCounsel, P.L.C. is not going to scare you with more intimidating concepts.  Rather, our goal is to help you understand and make good decisions.

The estate plan is the creative response of our attorneys to the issues raised by you. Most, if not all, clients will want their estate properly distributed to their beneficiaries without unnecessary delay or expense. Your estate planning objectives may, in fact then include minimizing taxes and avoiding lengthy probate proceedings.  But you may also have legitimate reasons to maintain some control over distributions.  For example, you may worry that a beneficiary will recklessly dissipate an inheritance, or that assets that might be left to a disabled child or an elderly loved one will be used up to pay for benefits that the government would otherwise provide.

WHAT DOCUMENTS MAKE UP AN ESTATE PLAN?

A basic estate plan includes elements of joint ownership, beneficiary designations, and a last will and testament.  A revocable living trust has multiple uses and may also be part of a more complex estate plan.  In all instances, you should consider a durable power of attorney and a patient advocate designation. The elements discussed below should be selected according to your unique circumstances and objectives.

Last Will and Testament

Virtually every estate plan will include a last will and testament (or will).  A will is a letter of direction to a probate court.  It tells the court how to administer and distribute your assets after death.  It also nominates a personal representative (i.e., executor) who is responsible for paying your debts and taxes prior to distributing your assets.  The only assets governed by the terms of the will are those that you own in your name alone at death.  If you have minor children or are the guardian for a legally incapacitated individual, you should nominate another person to take over as guardian in the will.  A nomination in your will or other writing receives preference even over a guardian appointed by the court.

The type of will used with a trust is commonly called a pour over will.  If certain assets owned by the you are not transferred to trust during your lifetime, the pour over will directs that the remainder of the probate estate be transferred to the successor trustee of the your trust.  Although probate is not avoided for all of your assets, privacy and discretion for most of the assets is still achieved.

Revocable Living Trust

A revocable living trust serves many purposes. Because assets are titled in trust name, not your individual name, trust avoids probate court at death, provides for continuity in the administration of assets, and provides for control in terms of distribution.

A revocable living trust is more than just a will substitute. A revocable living trust can include complex tax avoidance strategies. When fully funded with the client’s assets, it can also substitute for a conservatorship in the event of incapacity. A revocable living trust can also provide for minor children or disabled adults, without court intervention or the termination of government benefits.

Durable Power of Attorney

You may designate an agent to make a broad range of legal and financial decisions for you. Properly drafted durable powers of attorney are not affected by your subsequent disability or incapacity. Thus, you can plan for future incapacity by choosing, while competent, the person who will handle your finances. This often avoids the need for a court-appointed guardian or conservator, saving both time and expense for our older clients.

Patient Advocate Designation

In addition to a durable power of attorney for financial affairs, every client who can do so should make a medical power of attorney. This document is also known as a patient advocate designation.  It appoints someone to make health care decisions for you when you are unable to do so (the patient advocate).  The identity of the patient advocate and a clear expression of your wishes concerning medical and mental health treatment are important parts of our information-gathering process. The patient advocate must be familiar with your wishes and preference regarding health and mental health care, capable of communicating with family members and health care providers, and able to make difficult decisions regarding end-of-life treatment such as termination of life support.

HIPAA Authorization

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) generally restricts disclosure of a patient’s health care information to anyone but the patient. This would include family members and others. Because a patient advocate designation only takes effect on incapacity, vital information is often restricted from patient advocates, friends, or family members while the client has capacity.  To address this problem, we typically prepare a separate limited power of attorney authorizing an agent (or agents) to receive medical information and waiving the liability of any physician, hospital, or health care provider.

MARITAL AGREEMENTS

Typically, the purpose of a prenuptial or postnuptial agreement is to vary or relinquish the rights and interests upon death or divorce that your spouse would otherwise acquire in your property and estate by reason of marriage.  You can protect the inheritance rights of children from previous relationships and retain control of property brought into the marriage. You may wish to enter into a prenuptial agreement, for example, if you have substantial financial means and wish to earmark money for children from a previous marriage or set aside funds for other future needs, such as possible nursing home expenses. You might also wish to use a postnuptial agreement to preserve your interest in a family-owned business.