In some
circumstances, wills are still the tool of choice for the transfer of assets
accumulated during a lifetime. Even if a will is not the primary transfer
document, every estate plan will include a will to handle any property that may
not have been appropriately transferred to a trustee under a trust arrangement.
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Key Uses |
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Transfer
financial assets to family members at death. |
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Designate guardians for minor children. |
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Designate the person who will take charge of the estate and
distribute it to the heirs. |
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Create a
trust arrangement for the benefit of children that extends beyond their age of
majority. |
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Designate the recipients of items of personal property. |
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TRUSTS
The trust has
replaced the will as the primary estate planning document for many individuals.
It's flexibility allows it to be used for goals as diverse as avoiding the
cost, expense and delay of probate proceedings, to protecting the interests of
spouses and children, to sophisticated tax planning and charitable
giving.
Living trusts, testamentary trusts, certain types of irrevocable
trusts, special needs trusts, charitable remainder trusts, and life insurance
trusts are some of the types of trusts available. The appropriate use of a
trust can be critical to a well-developed estate plan.
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Key Uses |
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Avoid
probate |
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Avoid
or reduce estate taxes. |
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Provide
for the management of assets for children or an individual in the event of
disability. |
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Implement a program of charitable giving. |
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DURABLE POWERS of ATTORNEY
Powers of attorney are
another key component of a complete estate plan. Without a durable power of
attorney, a conservatorship in probate court is necessary to give someone the
authority to handle an individual's assets. In addition, mandatory accounting
is required and sales of real estate must be pre-approved by the
court.
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Key Uses |
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Designate the person who will have responsibility for handling your
financial affairs. |
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Administration of financial assets - pay bills, deposit checks, and
make house payments. |
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Sale or
purchase of stocks, bonds, and other assets. |
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Sale or
transfer of real estate. |
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In
coordination with a living trust agreement, complete the framework |
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of
protection in the event of incapacity an individual's incapacity. |
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DURABLE POWERS of ATTORNEY for HEALTH CARE and
HEALTH CARE DIRECTIVES
Perhaps no other issue creates as much
concern for a person as to what will happen if their health deteriorates to the
point where they cannot make basic decisions regarding additional medical care
or life-sustaining procedures they are to receive that hold no hope for
recovery. Without a durable power of attorney for health care (health care
directive), a guardianship must created by the probate court to make health
care decisions for you, if you cannot make them yourself.
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Key Uses |
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Define
the specific events that allow another person to make health care decisions for
you. |
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Identify
those medical procedures that you desire to be taken and those |
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that you
do not want taken |
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Specify
the events that will guide the person making health care decisions for
you. |
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NON-PROBATE
TRANSFERS
Non-probate transfers include ways of owning
property, such as joint ownership. These transfers also include designations
that accomplish the same purpose as joint ownership without creating lifetime
gifts or giving lifetime control, such as Transfer on Death designations or Pay
on Death designations or Beneficiary Deeds that are used with real
estate..
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Key Uses |
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Most
often used in place of wills for certain types of property, including
automobiles, |
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checking
and saving accounts, and certain real estate. |
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Most
appropriately used for widowed or single parents with one adult
child. |
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Does not
take the place of Durable Powers of Attorney or Health Care Powers of
Attorney. |
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FAMILY LIMITED LIABILITY PARTNERSHIPS
Family
limited liability partnerships and companies have become more prevalent in the
recent years due to certain IRS decisions and tax court rulings. The use of
these techniques may be appropriate in certain circumstances that require the
flexibility they provide.
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Key Uses |
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May be
an important part of a business succession plan for an individual or
family. |
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Separates management from ownership in a family owned
business. |
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Certain
tax planning benefits may be available through gifting of ownership
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interests that have discounted values. |
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HIPAA CONSENT FORMS
Generally included as a part
of estate planning package to obtain medical records when
necessary
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Key Uses |
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Some
trusts, durable powers of attorney for financial affairs, and durable powers of
attorney |
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for
health care depend on the certification of attending physicians to become
effective. |
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Made
available to the persons having the authority under other estate planning
documents. |
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