What is a Last Will and Testament?
A Will is a legal document that names a personal representative to manage and distribute your estate. A Will can also specify any guardians for minor children, specify distributions, and disposition of remains.
A Will is a public document and will be probated through the court. If you have privacy concerns, would like to avoid having your estate go through Probate, or own real property outside the State of Washington, having a Revocable Living Trust might be a better option for you. Contact a Wills and Trusts attorney to discuss the best option to suit your particular needs.
Durable Powers of Attorney for Health & Finances
It is important to plan for the possibility of incapacity. Not having a Power of Attorney in place exposes you to the possibility of a guardianship. A guardianship is when a guardian is appointed by the court to handle your financial and medical affairs. This could be a friend or family member, or even a complete stranger. Without the proper documents in place, you could end up having no say in who is chosen to be your guardian, and you will lose all of your rights.
Having a Power of Attorney for Finances and a Power of Attorney for Healthcare ensures that the person in charge of your affairs is someone that you know and trust who will care for your needs the way you would like. These documents allow you to choose, instead of the court.
A Power of Attorney can be limited or general. A limited Power of Attorney gives the person of your choosing the power to act on your behalf (such as sign checks, transfer property) while you are out of town, or otherwise unavailable. A general Power of Attorney is more comprehensive and gives the person of your choosing all of the powers and rights that you have.
A Power of Attorney for Finances is a document that gives the person of your choosing (attorney-in-fact) control over your financial affairs. This does not allow the attorney-in-fact to make decisions regarding your medical care.
A Power of Attorney for Healthcare is a document that gives the attorney-in-fact control over your medical care, but not your finances.
These are essential estate planning documents that should be executed along with a will or Revocable Living Trust.
What is a Trust?
A Trust is a legal document in which property is held by another party for the benefit of another. The Trustor (Trust Creator) transfers property to a Trustee (Trust holder) to hold for the beneficiaries the Trustor designates. The Trustee is given the legal title of the property, however, the Trustee is obligated to act for the good of the beneficiaries and abide by the terms outlined in the Trust document.
There are basically two kinds of Trusts: Irrevocable & Revocable.
Revocable Trusts, often referred to as ‘living trusts’, allow the creator of the trust to maintain total control over the trust and to amend, revoke, or terminate the trust at any time. A Revocable Living Trust is an alternative option for people who do not want their estate to go through a public, costly, and time-consuming Probate process.
What is the Difference Between a Revocable and Irrevocable Trust?
A Revocable Trust allows the trust maker to manage the assets in the trust for the benefit of the beneficiaries. Having a trust avoids probate (unless of course, the trust maker fails to fund the trust). The trust can be created so the assets will not be included in the estates of the beneficiaries, thus avoiding taxes when the beneficiary dies.
Irrevocable Trusts on the other hand, cannot be changed or amended by the trust maker. Any property that is put into the Trust is no longer considered the trust makers property. The only person who may handle the property is the Trustee named in the trust (which can never be the trust maker, unlike a Revocable Trust).
Placing your assets in an irrevocable trust can help you qualify for benefits such as Medicaid or VA. These kinds of benefits are means-tested, and since the property is no longer considered ‘yours’ it cannot be counted against you.
Trusts are typically more complex to set up, so they tend to cost more than Wills, however, money is saved on the back end by not having to pay for a Probate.
Frequently Asked Questions About Wills and Trusts
I Can’t Find My Loved One’s Will. What Should I Do?
If your loved one didn’t make a will, then you will need to swear under oath that no will can be located. If the will is subsequently found, then the estate must be redistributed in accordance with the will.
How Do I Transfer the Ownership of Property Without Selling It?
The executors of the estate will be able to transfer ownership of the real property in accordance with the will’s specifications or the rules of intestacy.
What Does Intestacy Mean?
If you die without a will (intestate), a court determines who inherits your assets. This may not be your intent, but roughly 70% of Americans currently have no will, and their estate will pass by intestacy.
Can an Executor Be Removed or Changed?
If the testator (the person who made the will) is still alive, then they may change their will with a codicil (an addition to the will) or execute a new will naming a different executor. If the testator has already died, then an executor can only be removed by agreement or by the courts. If you have a dispute with an executor or you wish to arrange a codicil, we can help.
Contact a Spokane & Tri Cities Will and Trusts Attorney Today
Please contact us to discuss the right option for you and your family. Our experienced attorneys and knowledgeable staff can guide you every step of the way.