Estate Planning

Estate Planning Attorneys in Ottawa County, Ohio

Intestacy Definition

Persons who fail to plan during their lives and die without creating a will. Each state has laws that dictate how an intestate person and property will be distributed leaving you with absolutely no control. Property may go to people you don't want and in ways that you never intended. Dying intestate means no tax planning was done on your behalf.

Will

A will or a last will and testament is a legal document that tells the probate court how you want your property distributed after you die, and who has the power and responsibility to wrap up your affairs. Through the probate process, the court will give the executor of your will the authority to gather all of your property, pay any remaining creditors, bills, and distribute your remaining property as you specify in your will.

Because the will takes effect only after a court determined that it is a valid document, a judge must act before your executor can step in and manage your estate.

Revocable Living Trust

Revocable Living Trust-based estate plan provides instructions that will allow you to:

Control your property while you are alive
Take care of you and your loved ones in the event of disability
Pass your property to your heirs when and how you want while maintaining privacy
Ensure that you and your spouse have sufficient assets to maintain your standard of living now and in retirement
Maintain maximum control and flexibility during your lifetime
Provide for you in the event you become disabled
Simplify administration as much as possible upon your death or disability (avoiding probate & guardianship)
Avoid having your private matters being made public unnecessarily
Ensure that the efforts you desire are used to save your life
Have your property continue to benefit the survivor after one of you dies
If married, protect your assets so that they cannot be lost as a result of remarriage after the death of one of you
Ensure that the persons you select in fact become the guardians of your minor children
Protect your children or grandchildren's inheritance from mismanagement
Structure your children or grandchildren's inheritance in such a way that it instills values and virtues
Educate your children and grandchildren
Reduce the risk of litigation from heirs who receive less than they think they are entitled to.
Minimize income taxes to the extent possible
Avoid or minimize capital gain tax on the sale of assets
Eliminate as much estate tax as possible

Pour Over Will

In the event that you die with assets outside of your living trust, a pour over will act to complete your estate plan by providing that assets not transferred to your trust during life are to be transferred to trust after death.

Estate Plan Maintenance

Your estate plan is a snapshot of you, your family, your assets, and the tax laws in effect at the time it was created. All of these change over time, and so should your plan. It is unreasonable to expect the simple will written when you were a newlywed to be effective now that you have a growing family, or now that you are divorced from your spouse, or now that you are retired and have an ever-increasing swarm of grandchildren! Over the course of your lifetime, your estate plan will need check-ups, maintenance, tweaking, maybe even replacing. So, how do you know when it's time to give your estate plan a check-up? Generally, any change in your personal, family, financial, or health situation, or a change in the tax laws could prompt a change in your estate plan.

HIPAA Authorization

The Health Insurance Portability and Accountability Act of 1996 (HIPAA), absent a written authorization from the patient, a health care provider or health care clearinghouse cannot disclose medical information to anyone other than the patient or the person appointed under state law to make health care decisions for the patient. The Regulations promulgated under HIPAA specifically authorize a HIPAA Authorization for release of this information to persons other than you or your personal representative. Thus, you should consider creating such an Authorization so that loved ones and others can access this information in addition to the personal representative.

Planning Tip: Consider preparing a HIPAA Authorization for loved ones and others who potentially need access to your medical information if you become disabled. Your estate planning attorney can create such a HIPAA Authorization for you.

Healthcare Power of Attorney

A healthcare power of attorney allows your trusted friend or family member to make medical treatment decisions for you if you are unable to communicate your wishes to doctors. Without one, you must have a guardian or conservator of your person appointed by the court before decisions can be made on your behalf.

A healthcare power of attorney not only saves precious decision making time, but it also makes sure that the individual you trust the most has the power to make these most important decisions for you if you are unable to make the decisions on your own.

Durable Power of Attorney

Who will make decisions for you if you are unable to make them for yourself? Who will have the power to sign documents on your behalf, or make sure your bills get paid?

Without a durable power of attorney, someone who is mentally incapacitated must be taken to guardianship or conservatorship court to have a decision-maker named for them by a judge. A carefully written durable power of attorney will allow you to name someone you trust to make decisions for you if you become disabled to the point of no longer being able to make those decisions yourself.

Annual Gifting

A lifetime gifting program allows you to avoid gift, estate, and generation-skipping transfer tax on transferred assets. Under the Internal Revenue Code, you can transfer up to $13,000 per year, per person, to anyone without incurring gift tax or generation-skipping transfer tax. A married couple can give twice that amount, or $26,000 per person, per year. With a lifetime giving program, you transfer this amount annually to the individuals of your choice, typically children, grandchildren and other close family members.

For example, if you give $13,000 per year to two beneficiaries for five years, you will have removed nearly $130,000 from your estate for estate tax purposes (excluding asset growth). After 10 years, you will have removed more than $260,000 and $650,000 after 25 years. Not surprisingly, the amount removed from your estate is increased significantly with each additional $13,000 beneficiary.

Annual exclusion gifts can also be used to shield transfers to an irrevocable trust from gift and generation-skipping transfer tax. The beneficiary must have the right to withdraw up to $13,000 of the transferred funds, but if that right is not exercised, the gifted funds can then be used to purchase life insurance on the life of the transferor for other investments. This trust can be a multigenerational estate tax-exempt trust or it can become a family bank for: (1) education; (2) business acquisitions; or (3) home purchases, among other things.

Medical care and tuition paid to assist family members or any other individual may be made in addition to the annual exclusion gifts. As long as the gifts are made directly to the medical facility or educational institution, donors can exceed the $13,000 annual exclusion amount without the imposition of gift taxes.