What's an Executor
One of the more important decisions you must make when writing your will is the selection of an executor. The executor's job is to "wrap up" your financial affairs upon your death. The person designated must first identify and determine the value of the assets that are part of your estate (trusts, life insurance policies, pension plans, and some types of jointly owned property fall outside the executor's purview). This often requires hiring an appraiser, whose fee comes out of your estate's assets, as do expenses for lawyers, accountants, and other professionals. An executor also pays all of your remaining debts, files tax returns, and distributes whatever remains to your heirs.
This should not be considered legal advice, you should consult your own advisor about your specific situation.
Copyright © 2002 Liberty Publishing, Inc. All rights reserved.
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Advanced Plans for Large Estates
If your (and your spouse's) combined assets exceed $1,000,000 (in 2002), your estate may incur a substantial estate tax liability. In addition, if you are a business owner, a lack of planning could trigger the forced sale of your business upon your death. Fortunately, there are a number of estate planning mechanisms available to help individuals pass their hard-earned wealth to future generations intact. A qualified, legal professional can assist you in more complex planning matters such as estate tax minimization, wealth transfer, and gifting strategies.
This article is for informational purposes only and is not intended to be tax or legal advice.
Copyright © 2002 Liberty Publishing, Inc. All rights reserved.
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Health Care Directives - The Basics
A living will is a medical directive written in advance, that sets forth an individual's preference for treatment in the event of his or her inability to direct care. Granting power to another person to make medical decisions on your behalf in the event of incapacity is known as a health care proxy. Depending on state law, the documents may be drawn separately, or the living will may be incorporated into the health care proxy. Both directives would come into effect only when you are unable to make health care decisions for yourself. The documents may be drafted to specify when the directives should be initiated (e.g., a life-threatening situation accompanied by unconsciousness).
This is not intended to be tax or legal advice; you should consult your own advisor regarding your specific situation.
Copyright © 2002 Liberty Publishing, Inc. All rights reserved.
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What is a “Power of Attorney”?
An "attorney" is someone legally entitled to conduct business on your behalf. You have the right to provide anyone with this power. If the power of attorney is limited, the individual you choose can conduct only that business specified in your agreement. If the power of attorney is general, the person's authority is much broader, but still assumes you are competent to review and approve his or her decisions. If the agreement contains what is known as "durable" language (made possible by passage of certain state laws), it allows the attorney in fact to make decisions even though you become physically or mentally incapacitated.
This is not intended to be tax or legal advice; you should consult your own advisor regarding your specific situation.
Copyright © 2002 Liberty Publishing, Inc. All rights reserved.
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Estate Planning: It's A Team Effort
The “A/B” trust arrangement has been touted as a “one size fits all” estate planning tool that is the essence of simplicity. In reality, very little in the area of estate planning is simple and living trusts are no exception. The fact is, proper estate planning takes into account the coordination of all property transfer methods. Careful estate planning also involves the assistance of advisors who are knowledgeable in legal and tax matters. However, a great deal of personal involvement should also be expected because estate planning goes beyond legal documents and tax strategies. Only such involvement and interest in the estate planning process can ensure that your needs and concerns will be properly addressed.
Copyright © 2002 Liberty Publishing, Inc. All rights reserved.
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Irrevocable Life Insurance Trusts
Many estate planning practitioners view the irrevocable life insurance trust (ILIT) as one of the most flexible and powerful estate planning tools available. When properly structured, the proceeds of an ILIT will be excluded from your estate. They will be payable to the trust and either accumulated for future distribution or paid to the trust’s beneficiaries (generally, your children, grandchildren, or other heirs) without incurring estate tax consequences. Bear in mind that, as with all trusts, it is best to consult a qualified, legal professional before proceeding.
This article is for informational purposes only and is not intended to be tax or legal advice.
Copyright © 2002 Liberty Publishing, Inc. All rights reserved.
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