09/22/2021
What are the documents?
Revocable Trust: This document is often used as the “centerpiece” of estate planning. Sometimes families don’t have enough assets to warrant this document, but there an estate planning attorney can help these families, as well. The Revocable Trust basically does two things: It names who has authority to settle your estate at death and how you want your assets distributed. Also, by signing this document and funding your assets to the trust, you will avoid probate. “Funding” means that your assets are re-titled in the name of the trust. Not all assets should be funded to your trust, but your attorney will go through each of your assets and make sure that your estate plan is properly funded to avoid probate court.
The Revocable Trust is superior to a Will in several ways. First, in a Trust your intensions are written in a contract, so that challenging the Trust is much harder than a Will in court. Second, your assets can be distributed over time. For example, a beneficiary can receive a certain amount or percentage of your assets each year until the assets are completely distributed. Third, trust assets can be held “in trust” for beneficiaries that cannot inherit directly. Examples of this situation, is a minor child, a beneficiary who receives government aid or a beneficiary who is incarcerated. Fourth, trust assets can be distributed only upon certain events, such as college or when someone has successfully completed a drug treatment program. Fifth, and most importantly, a Will must be submitted to Probate Court and assets can only be distributed through an Order from the Probate Judge in order to distribute assets. A Trust completely avoids the probate court process.
There are different kinds of trusts. The most common is the Revocable Trust. However, an Irrevocable Trust is sometimes used to reduce the size of the Grantors taxable estate or for Medicaid Planning. An Amenities Trust is used for distributing assets to an individual with developmentally disabled who receiving government benefits. Trusts can be created that allows family members to all use real estate that has been in the family for many generations. This kind of trust is commonly known as a “Cottage Trust”. Finally, Charitable Remainder Trusts are used to again, reduce the taxable estate of the Grantors and also provide a stream of income to them and ultimately to distribute their estate to a charity of their choice.
Will: A Will is simply a list of instructions to the probate judge as to how you want your assets distributed. All Wills must go through probate and are subject to challenges from anyone who wants to challenge them.
Durable Power of Attorney for Financial: This document allows you to give legal authority to people that you trust, to carry out financial directives when you are unable to make the necessary decisions or do the activities necessary to maintain your finances.
Durable Power of Attorney for Healthcare: This document allows you to give legal authority to a family member or friend, to make medical decisions when you are unable to make them yourself because you are incapacitated or unconscious.
Living Will: This documents states your wishes regarding life support and is also known as an Advance Directive to Physician
HIPPA Disclosure Form: This form informs the physician and/or hospital staff of the people who are allowed to know your medical information or status. Your spouse is the only person who is entitled to this information automatically.
