Estate Planning - An Overview

Estate planning allows an individual to plan for his or her lifetime objectives and to provide direction about the disposition of his or her assets after death. Estate planning can include wills and trusts as well as powers of attorney and healthcare directives. Estate planning is impacted by state and federal law, and any individual may find that more elaborate or creative legal means are necessary for his or her situation. Some of these more complex techniques include trusts, family limited partnerships (FLPs), and limited liability companies (LLCs). An estate planning lawyer plays an estential role in assuring that your estate planning goals are understood and carried out. If you have estate planning-related legal questions, call our firm today to schedule a consultation with Michael T. Heider.

Asset Protection and Estate Planning

An important goal of estate planning is to protect income and assets from creditors’ claims and tax collection. While many people think asset protection involves dishonest techniques, there are many ways to protect financial reserves, personal property, real estate, and other assets for retirement or for future generations. In addition to federal and state laws that exempt certain types of property from creditors’ claims, taxation, or both, there are numerous estate planning tools that may be able to shield assets from future creditors and reduce or eliminate estate or income taxation. If you are interested in working with an estate planning attorney to create a plan to protect your assets, contact our firm today to schedule a consultation.

Estate Planning Needs of the Elderly

Elder law deals with the legal, financial, and health needs of senior citizens. The country’s average age is advancing all the time, and now even baby-boomers are dealing with health issues and legal concerns they had not anticipated. In addition to estate planning, elder law attorneys also help with preparing for long-term healthcare needs, applying for government programs, addressing financial fraud, combating physical abuse, and establishing guardianships and conservatorships. If you have elder law or estate planning-related legal questions, call our firm today to schedule a consultation with an estate planning lawyer.

Wills and Trusts

A will is a document that tells a person’s family or heirs and the courts how to distribute his or her money and property. A will is a basic estate planning tool, and a current and valid will is the best way to make sure your property is distributed according to your wishes and your family is taken care of after you’re gone. Many people also use trusts in conjunction with their will, as an independent estate planning tool, or both. Whether you want to prepare your first will or you are interested in updating your estate plan or exploring trusts, an estate planning lawyer can help you tailor a plan to your needs.

Powers of Attorney

A power of attorney is a legal document in which a person (the principal) designates and authorizes another person (the agent or attorney-in-fact) to transact business or make certain decisions on his or her behalf. When a power of attorney is in effect, the agent essentially steps into the shoes of the principal and makes decisions that are legally binding on the principal. Powers of attorney can grant broad, general authority (known as a general power of attorney) or they can limit the attorney-in-fact's power to act on behalf of the principal to particular situations (known as a special power of attorney). Because there are many different types of powers of attorney available to address a variety of situations, powers of attorney are extremely useful estate planning tools. If you are interested in drafting a power of attorney, contact our firm to schedule a consultation with an estate planning attorney.

What is probate?

Probate is a process in which the court decides who receives assets that were owned by a person who has died. Assets are anything a person owns with value, such as property, cash, etc.

When is probate needed?

Probate is not always necessary. If the deceased person owned bank accounts or property with another person, the surviving co-owner will then own this property automatically. If a person dies leaving very few assets, such as personal belongings or household goods, these items can be distributed among the person's heirs without the supervision of the court. Sometimes probate is needed to:

- Collect debts owed to the deceased person.

- Clear title to land or stocks and bonds, or large bank or savings and loan accounts that were held in the name of the deceased person only, and put the title to these assets in the names of the heirs.

- Settle a dispute between people who claim they are entitled to what the deceased person left behind.

- Resolve any disputes about the validity of the deceased person's will.

What happens during the probate process?

- A personal representative is selected. A personal representative is someone who handles the deceased person's affairs. The person is either selected by the deceased person in his or her will or by a court. If a person dies without a will, the personal representative is usually the spouse, child or close relative. If none of those people are available or willing to be the personal representative, the court may choose a bank, trust company or lawyer.

- The will is proved and delivered to the court. The deceased person's will is proved by a written statement made under oath by the witnesses to the will. At the time the will was created, there must have been two witnesses who signed the will in the presence of each other. Each witness must be able to testify that at the time the will was signed, the deceased person was of sound mind and knew what he or she was doing. If someone has the deceased person's will, he or she must deliver it within ten days to the  court (this is required by Florida law).

- An inventory of assets goes to the court. The personal representative gathers together information about the deceased person's assets and gives the inventory to the court. The personal representative may sell some assets if expenses need to be paid, and if selling the assets is not against the will.

- A notice to creditors is published in a local newspaper. This public notice gives them three months to bring any claim against the estate for debts the deceased person owes them. The personal representative also gives written notice to all known creditors and those who may be creditors.

- The heirs and people named in the will are notified of the probate proceeding.

- The personal representative collects debts that are owed to the deceased person.

- The personal representative prepares state or federal tax returns and any inheritance, gift and estate tax returns and pays the taxes.

- The court approves the inventory of assets. After approval by the court, the deceased person's assets are distributed to the people and entities (such as charities or trusts) named in the will or to the heirs of the deceased person.
What is the role of the court?

- The court makes sure that creditors are notified and their claims are settled. (Clearing such claims is an important reason for court supervision.)

- The court examines the will and the statements of the witnesses to make sure that the will is valid.

- The court makes sure that proper receipts are filed for all expenses taken from the estate during probate.

- The court makes sure that all assets are distributed to the people who are supposed to receive them.

How long does probate take?

Probate can be started immediately after death. The process will take a minimum of six to nine months. If the estate includes property that must be sold, or if there are complicated tax matters, probate can last much longer. However, most small estates will only take four to six months and can be handled informally.

What are the costs involved?

A personal representative will earn a fixed percentage of the value of the total estate. Extra costs may be approved by the court for the personal representative and a lawyer if the estate is complicated. Other costs include court filing fees, legal notices published in the local newspaper and any other necessary expenses.

Does probate mean more taxes?

Probate does not affect taxes that must be paid. Federal estate tax applies only to estates that have a value greater than $2 million.

Do I need a lawyer?

To achieve the results you want, probate should be handled with an understanding of the legal principles involved. A probate lawyer can help you avoid the many possible tax traps and other problems that could arise. Also, a lawyer can help you prepare and file the legal documents and prepare you for hearings in the court.