Frequently Asked Questions: Estate and Business Planning
These Questions and Answers are general in nature and are not to be considered legal advice. Questions about a specific case or situation should be directed toward your attorney.
1. What is estate planning?
2. Do I need a will? 3. I don't have a lot of money, do I still need a will? 4. Can I give my property and assets to whoever I want? 5. What else can my will do? 6. Can I change my will? 7. What happens when there is no will? 8. Is joint tenancy a substitute for a will? 9. What is the estate tax? 10. Can estate taxes be saved by a will? Back to Questions 1. What is estate planning?Estate planning is the process of deciding and documenting your wishes for the disposition of assets, both during your life and after your death. It includes planning for incompetency as well as the care of minor children. Doing an estate plan does not require having a lot of money or assets. It is a process of taking control of what you do have and putting your wishes in writing. Back to Questions2. Do I need a will?Yes. Everyone who is competent and able under state law to have a will should have one. A properly drafted document may make dealing with your affairs much easier for your heirs. Back to Questions3. I don't have a lot of money, do I still need a will?Yes. If you have any heirs or any preferences about what you want done with your belongings or money after your death, you need a will. Back to Questions4. Can I give my property and assets to whoever I want?Generally, yes. But there some exceptions. For example, a surviving spouse has the right to elect to take a fixed share of the estate regardless of the will. Back to Questions5. What else can my will do?In your will, you select an executor to handle your estate. You may also establish one or more trusts that can achieve tax savings or manage assets for beneficiaries. You may even name a person to be guardian of any minor children. Back to Questions6. Can I change my will?Yes. You may change or entirely revoke your will at any time before your death as long as you are competent. However, any changes to a will must be made with the same formalities of the original. Please do not make changes, marks or notes on your original will. Back to Questions7. What happens when there is no will?If there is no will, state intestacy laws will govern the distribution of the estate. This will be supervised by the probate court and require hearings before a judge. In general, the intestacy rules divide the assets among the surviving spouse, children, and parents of the deceased. Most people assume their spouse will get everything. Without a will or properly titled assets, this may not be true. Back to Questions8. Is joint tenancy a substitute for a will?No. While joint tenancy may be useful in certain situations, in other situations it can be devastating. Even where joint tenancy might work if one spouse dies, it does not solve the problem of the death of both spouses. Back to Questions9. What is the estate tax?The federal estate tax is applied against the total value of all the assets owned by you at the time of your death. This includes among many other things - cars, jewelry, real estate, bank accounts, retirement plans, and the face amount of any life insurance policies on your life. On top of this, it also includes the value of certain property that the you had access to or control over even though you may not technically own it. An asset does not avoid estate tax just because it avoids probate. Back to Questions10. Can estate taxes be saved by a will?With a properly drafted will and implemented estate plan, estate tax savings can typically be accomplished in situations where estate taxes are an issue. |
