How They Can Help You - Estate Planning Attorneys
The objective of this discussion is to review some of the myths and realities of estate planning. A number of articles have been written on the subject but let's see if we can't put a different spin on it by keeping it simple. By dispelling some of the common misconceptions, we will have a better understanding of how important it is to take positive action to keep our estate plans in order. The Economic Growth and Tax Reconciliation Relief Act of 2001 (EGTRRA) threw many individuals for a loop when it came to estate planning. Tax laws are never simple but EGTRRA added a level of confusion rarely seen in advanced planning. For instance, between now and 2011 the federal estate tax is scheduled to decrease, disappear and then spring back to life. According to a Wall Street Journal article dated May 11, 2005, the "...current estate tax law puts estate-tax planners in an impossible situation...". With such uncertainty, some potentially damaging estate planning myths have surfaced. These financial "urban legends" stand in the way of prudent estate planning.
Estate plan trusts attorneys have a comprehensive understanding of the probate process in your state, as well as up-to-the-minute knowledge of estate tax laws. They will help you ensure that your final wishes regarding the distribution of your estate, as well as your health care and life support wishes, are carried out. Estate planning attorneys can help you regardless of whether you want to draft a simple will for a small estate; to change an existing will so that it reflects a change in your financial status; to establish a living trust; or to set up an estate plan which includes a will, trust, and your health care and life support directives.
As a youngster, I recall seeing a thick blue booklet in my family's bookshelf written by Norman F. Dacy, entitled How to Avoid Probate. The book is a classic, and helped to spawn the move within estate planning field away from wills, and toward "living" or "inter vivos" trusts (which is Latin for "during life"). Some now associate the word "probate" with the twin evils of expense and delay. Many conclude that probate is "bad," but may not have any idea why this is so, or even what exactly probate is. Simply stated, "probate" is a court-supervised method of transferring property and compensating creditors after death. In California, for instance, there are two main methods of communicating one's wishes for disposition in a court supervised probate proceeding. The first is through a properly witnessed and executed will. The second method is through a "holographic," or handwritten will (although, not all states offer a holographic will). To be valid, both types of wills have specific requirements, the details of which are beyond this article.
Permanent repeal of the federal estate tax requires an affirmative vote of 60 Senators. This is not an easy task. After all, repealing the federal estate would eliminate a significant source of federal revenue. Just how much revenue would the repeal of the federal estate tax eliminate? The cost of repeal through 2015 (including the current rates and exemption amounts) is estimated at $290 billion (according to the Joint Tax Committee, a bipartisan group). Other sources have estimated that the cost would be even higher. In addition to the cost of repeal, the federal government has been hit with several large budget items including Hurricane Katrina, the Iraq war and a growing deficit. Additionally, the election cycle always plays a role. Faced with these significant budgetary items, repeal of the estate tax appears to be less likely. During the summer of 2005, there was much talk in Washington, D.C. of estate tax repeal. At one point, the House of Representatives voted in favor of repeal and the issue was put before the Senate for consideration. 58 Senators (out of a necessary 60) voiced their support for repeal in an informal straw poll. There was a general feeling in Washington, D.C. that the issue of repeal would come to a vote in the Senate. Because of the factors previously listed (Hurricane Katrina, Iraq war, deficit concerns, etc), the issue never did make it to a final vote in the Senate.
Estate planning attorneys can also advise you as to whether or not any personal changes in you life will require a change in your estate plan. If, for instance, you are widowed or divorced, in you later years, and considering remarriage, you should be aware that there may be consequences for your estate. Should you remarry late in life, you and you spouse will be responsible for the costs of each other's long-term health care should one of you be placed in a nursing home. Those costs be a significant drain on you, or you future spouse's, assets.
Trusts are all the rage -- and for good reason. In general, you can avoid the probate court by transferring property to trust. When someone places property into a trust, they transfer ownership to a trustee, who manages and disposes of the property in accordance with the instructions in the trust agreement. Usually, in the case of a fully revocable trust (which means that the trust can be readily amended or revoked) the originators of the trust (called the "trustors" or the "settlors") are also the trustees. In effect, the trustee in such a case manages his, or her, own money. When you own your own property outright, you can obviously sell it, lease it, spend it, or save it. Depending upon how it is drafted, the same is true in the case of a settlor who places his property in a fully revocable living trust -- the property in such a case may also be sold, spent, or leased. For all practical purposes, the settlor in such a case still owns the property. However, when the settlor dies, his or her successor trustees take over management of the trust, passing the property to the beneficiaries and usually avoiding probate court. A revocable trust of this type, by itself, confers no tax benefit even though there are certain types of trusts, and estate plans, which sometimes can provide such benefits.
Estate plan trusts attorneys have a comprehensive understanding of the probate process in your state, as well as up-to-the-minute knowledge of estate tax laws. They will help you ensure that your final wishes regarding the distribution of your estate, as well as your health care and life support wishes, are carried out. Estate planning attorneys can help you regardless of whether you want to draft a simple will for a small estate; to change an existing will so that it reflects a change in your financial status; to establish a living trust; or to set up an estate plan which includes a will, trust, and your health care and life support directives.
As a youngster, I recall seeing a thick blue booklet in my family's bookshelf written by Norman F. Dacy, entitled How to Avoid Probate. The book is a classic, and helped to spawn the move within estate planning field away from wills, and toward "living" or "inter vivos" trusts (which is Latin for "during life"). Some now associate the word "probate" with the twin evils of expense and delay. Many conclude that probate is "bad," but may not have any idea why this is so, or even what exactly probate is. Simply stated, "probate" is a court-supervised method of transferring property and compensating creditors after death. In California, for instance, there are two main methods of communicating one's wishes for disposition in a court supervised probate proceeding. The first is through a properly witnessed and executed will. The second method is through a "holographic," or handwritten will (although, not all states offer a holographic will). To be valid, both types of wills have specific requirements, the details of which are beyond this article.
Permanent repeal of the federal estate tax requires an affirmative vote of 60 Senators. This is not an easy task. After all, repealing the federal estate would eliminate a significant source of federal revenue. Just how much revenue would the repeal of the federal estate tax eliminate? The cost of repeal through 2015 (including the current rates and exemption amounts) is estimated at $290 billion (according to the Joint Tax Committee, a bipartisan group). Other sources have estimated that the cost would be even higher. In addition to the cost of repeal, the federal government has been hit with several large budget items including Hurricane Katrina, the Iraq war and a growing deficit. Additionally, the election cycle always plays a role. Faced with these significant budgetary items, repeal of the estate tax appears to be less likely. During the summer of 2005, there was much talk in Washington, D.C. of estate tax repeal. At one point, the House of Representatives voted in favor of repeal and the issue was put before the Senate for consideration. 58 Senators (out of a necessary 60) voiced their support for repeal in an informal straw poll. There was a general feeling in Washington, D.C. that the issue of repeal would come to a vote in the Senate. Because of the factors previously listed (Hurricane Katrina, Iraq war, deficit concerns, etc), the issue never did make it to a final vote in the Senate.
Estate planning attorneys can also advise you as to whether or not any personal changes in you life will require a change in your estate plan. If, for instance, you are widowed or divorced, in you later years, and considering remarriage, you should be aware that there may be consequences for your estate. Should you remarry late in life, you and you spouse will be responsible for the costs of each other's long-term health care should one of you be placed in a nursing home. Those costs be a significant drain on you, or you future spouse's, assets.
Trusts are all the rage -- and for good reason. In general, you can avoid the probate court by transferring property to trust. When someone places property into a trust, they transfer ownership to a trustee, who manages and disposes of the property in accordance with the instructions in the trust agreement. Usually, in the case of a fully revocable trust (which means that the trust can be readily amended or revoked) the originators of the trust (called the "trustors" or the "settlors") are also the trustees. In effect, the trustee in such a case manages his, or her, own money. When you own your own property outright, you can obviously sell it, lease it, spend it, or save it. Depending upon how it is drafted, the same is true in the case of a settlor who places his property in a fully revocable living trust -- the property in such a case may also be sold, spent, or leased. For all practical purposes, the settlor in such a case still owns the property. However, when the settlor dies, his or her successor trustees take over management of the trust, passing the property to the beneficiaries and usually avoiding probate court. A revocable trust of this type, by itself, confers no tax benefit even though there are certain types of trusts, and estate plans, which sometimes can provide such benefits.
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Frank Miller has a Debt Consolidation Blog & Finance, these are some of the articles: Details And Advice On Using Payday Loans In A Pinch You have full permission to reprint this article provided this box is kept unchanged.
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