Most of us don’t put nearly as much though as we should into planning how our estates will be distributed, and the estimates are that nearly two-thirds of Americans die intestate, without having prepared a will. While their estates will eventually be distributed according the inheritance laws in their states, those laws may not reflect at all how they would have chosen to pass on their assets. If you want to avoid that situation, finding a firm of experienced estate planning attorneys is your best answer.

Some who would never consider fixing a garage door or stuccoing a wall would unthinkingly prepare a will or trust using many materials found in bookstores. Bookstores abound with quick-fix be-your-own-lawyer books and CDs, featuring forms and fill-the-blank forms and programs for wills, trusts, and powers of attorney for healthcare decisions. Some of these materials are even state specific, offering different provisions for residents of different states. Some of these do-it-yourself materials are fine, and may even be useful. If correctly used, many of these forms might work for a do-it-yourselfer. But suppose your case is different? Suppose you fail to properly use the form?

One thing I have noticed about building materials is that the old rule of thumb generally applies: you get what you pay for. The same is true in estate planning. But it is also true that legal documents such as wills and trusts oftentimes do not „speak“ until the author is deceased or incapacitated. Because of this fact, in the case of estate plans the handyman analogy of buying double the building materials breaks down. If a wall is improperly built, it can be torn down and redone. But if a will is improperly drafted, or if it fails to state the intent of the author, there is often no opportunity for a second try. Rather, in many cases, when the author of the will or trust is incapacitated or deceased, the planning „solution“ either fails, or has completely unexpected and unwanted consequences. Still, to be a good consumer of legal services, self-education is essential in communicating needs to an estate planning professional. The following is an overview of some of the major estate planning topics that should be applicable in most states.

To insure that the life insurance proceeds will be excluded from the insured’s estate, two of the primary requirements that must be met are that the insured must not have any incidents of ownership in the policy and the trust must be irrevocable. Some people believe that, in the face of tax law uncertainty, clients should avoid using ILITs. These same people fear that once a policy is placed in an ILIT, the policy is locked in the trust forever, even in the unlikely event that the estate tax is repealed. Nothing could be further from the truth. In reality, ILITs can be drafted with flexibility. Some ILITs today are being drafted to give the trustee the discretion to distribute the cash surrender value of the insurance policy to trust beneficiaries during the trust creator’s lifetime. This „escape“ language builds flexibility into ILITs.

With that information, estate planning attorneys can then explain to you the best alternatives for seeing that your estate is handled as you wish. They will not only discuss wills and trusts; they will present options which you can employ immediately to lessen the taxes and probate costs on your estate.

Concerning the issue of expense, in California the ordinary attorneys and personal representative fees are determined by statute, and are set out specifically in the Probate Code [California Probate Code 10800]. Extraordinary expenses may sometimes be charged, but the court must permit the added expense. Sometimes expenses may be saved if the personal representative waives his or her fee. If the executor or administrator is a family member, rather than an institution or professional, fees are often waived to save expense. In the final analysis, trusts are usually more expensive than wills to prepare, but wills administered through a court supervised probate are usually more expensive and time consuming than administering a trust. However, at least in California, there is another possible alternative: An expedited procedure for small estates (i.e., estates under $100,000, excluding exempted property) [California Probate Code 13100], which does not require opening and administering a probate estate. Therefore, in some cases opening a probate may not even be necessary.

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