Do you know what will happen to your assets in the unfortunate instance of your death or incapacitation? Without proper planning, your assets may not be allocated in the way that you would have wanted, and your loved ones may be left with heavy taxes.
Estate planning is an important step to take in deciding who inherits your assets, and hiring a lawyer experienced in estate planning is a good place to start.
Understanding Estate Planning
During the estate planning process, you’ll arrange how your assets will be allocated in the event that you become incapacitated or pass away. Meaning that there will be clear instructions on the distribution of your belongings and the adequate preparation of tasks.
In addition to ensuring that you confirm where your assets are distributed, there are other reasons to sit down with a lawyer. Asking the right questions about estate planning will ensure that you have the chance to name your children’s guardian, reduce taxes on the assets that you leave behind, and minimize the risk of family drama.
Question To Ask Your Attorney And Yourself
Death and incapacitation are not things that many people voluntarily think about on a daily basis. Without proper thought, important details can be overlooked, and the process misunderstood. Here are a few questions to consider when meeting with an attorney.
What Sort Of Ownership Is My Property In?
One of the first questions that you should ask is the type of ownership that your assets are held. Whether its a vehicle or a home, joint ownership means that if one of the owners dies, then the asset will be passed on to the remaining owner. In addition, they will not need to worry about probate.
Are There Designated Beneficiaries?
If you want to avoid probate when transferring an asset to a beneficiary, then the individual needs to be explicitly named and a beneficiary designation form signed. Some accounts that are able to have the “payable on death” designation will apply to include IRAs, annuities and life insurance policies.
What Role Does A (Living) Trust Or Will Play?
It’s important to understand the difference between a trust and a will.
A trust allows your estate to be passed on to your beneficiaries without the expenses that come with the estate assets needing to go through the Court probate procedure. Instead, distribution is accomplished through a chosen trustee.
A will is a legal document that states how you want your assets to be distributed upon your death. A probate usually will be required for this process and there are more expenses involved.
There are also variations of a trust and a will, such as a living trust which helps the distribution of your assets in the instance of incapacitation or illness. A lawyer will best guide you on your needs.
How Is Property Transferred After Death?
In connection with the above question, there are various ways for property to be transferred. A valid will ensure that your property is distributed according to your wishes and not the way that state statutes set forth. Beneficiary designations, such as enhanced life estate deeds, prenuptial arrangements and life insurance policies, are another option.
Are My Power Of Attorney Forms Up To Date?
There are more than one type of power of attorney., including financial and medical. The financial power of attorney will legally manage your financial affairs in the instance of illness or incapacitation.
A medical power of attorney form allows you to appoint someone to help make health care decisions in the instance that you are not able to do so yourself.
Often, these powers of attorney are combined into one document. It is also important that the power of attorney be drawn in accordance with state statutes, so that it is a “Durable” power of attorney, meaning that, even if you are totally incapacitated, you r appointed attorney in fact can act on your behalf.
How Does Tax Impact Estate Planning?
If your primary state of residence is Florida, then your future estate will be administered under the state of Florida’s laws. Under these laws, generally,there is no inheritance tax or state-level estate tax applied, regardless of where your heirs may live.
If you receive an inheritance from someone that resides in another state, then your receipt of those assets may be impacted by the alternative state’s laws. The amount of the tax typically depends on the value of the inheritance, familial relation, and the state’s rates.
What Does It Mean To Be The Named Executor Of An Estate?
If you have been selected as the executor, or personal representative of a will or trustee of a trust, then there are certain responsibilities in addition to managing the distribution of assets. For example, you also need to ensure that the tax returns of the deceased are filed. A qualified estate planning attorney will be able to guide and advise on these responsibilities.
Is It Worth Hiring An Expert?
While there it is possible to prepare your own will and plan, it is not recommended. The legalities of estate planning can be complex and are unique to every given situation. It is worth hiring the services of an experienced professional to assist in the process.
Get The Help That You Need
At the law offices of Gary I. Handin, we pride ourselves in more than 50 years of legal service to the greater Coral Springs area. For all your estate planning questions and needs, contact us at (954) 796-9600.