No matter your age, it’s good planning to have your legal documents in order. To prepare for unexpected catastrophes, provide for spouses and children, protect a business, or prepare for a time when you may not be able to make financial or medical decisions on your own. In this blog we’ll discuss the following legal documents.
• Wills and Trusts
• Powers of Attorney
• Health Care Proxy
• Probating the Estate
TYPES OF WILLS
Simple Will—for people with simple estates, few assets, and a straightforward approach to naming beneficiaries. It can also identify a guardian for minor children should both parents die.Pour Over Will—for those who’ve established a trust. When a person with a revocable living trust dies, assets in the trust are distributed based on terms of the trust. But for property acquired AFTER the trust’s creation, a pour over will allows for those additional assets to “pour over” into the trust upon the person’s death so they’re distributed according to terms of the trust.
Pour Over Will—for those who’ve established a trust. When a person with a revocable living trust dies, assets in the trust are distributed based on terms of the trust. But for property acquired AFTER the trust’s creation, a pour over will allows for those additional assets to “pour over” into the trust upon the person’s death so they’re distributed according to terms of the trust.
Reciprocal Will—reciprocal wills involve two people, often married couples and longtime partners, who write basically identical testaments stating their partner inherits their property upon their death, and listing another beneficiary should both partners die simultaneously. After one partner dies, the other can change the beneficiary or anything in their testament.
Living Will—unlike the above, a living will doesn’t deal with distribution of property upon a person’s death. It dictates 1) a person’s wishes upon incapacitation 2) a decision maker to deal with potential complications due to that incapacitation.
TRUSTS
A trust is “a legal entity created by a party (the trustor) through which a second party (the trustee) holds the right to manage the trustor’s assets or property for the benefit of a third party (the beneficiary).”
There are many types of trusts. Here we’ll discuss living, testamentary, revocable, and irrevocable trusts.
Living Trust—made by a trustor during their lifetime, with assets/property intended for the individual’s use during their lifetime, it allows the trustor to benefit from the trust while alive, but passes the assets/property on to a beneficiary upon their death.
Testamentary Trust—an agreement made to benefit a beneficiary once the trustor has died, it details how assets be distributed and is irrevocable. It’s often instituted by an executor, who manages the trust for the trustor’s decedents.
Revocable Trust—created during the trustor’s lifetime, it can be changed/terminated during the trustor’s lifetime by the trustor. The three parts of the arrangement (trustor, trustee, beneficiary) are often the same person (who can still manage their own assets). Upon the trustor’s death, assets are handed over to a successor trustee and beneficiaries.
Irrevocable Trust—cannot be changed or altered during the trustor’s lifetime or revoked after the trustor’s death. Its assets cannot be moved back into the possession of the trustor.
POWERS OF ATTORNEY
Power of Attorney is “the authority to act for another person in specified or all legal or financial matters.”
General Power of Attorney—the agent can perform almost any act, like opening/managing financial accounts/personal finances. It is terminated when the principal becomes incapacitated, revokes the POW, or dies.
Durable Power of Attorney—designates a person to act on the principal’s behalf and includes a “durable clause” that maintains the POW after the principal becomes incapacitated.
Special or Limited Power of Attorney—the agent has specific powers limited to a particular area, e.g., authority to sell real estate.
Springing Durable Power of Attorney—available when a specified event like incapacitation occurs.
HEALTH CARE PROXY
A health care proxy names someone you trust as your proxy, to express your wishes and make health care decisions if you cannot speak for yourself.
You don’t have to be terminally ill to designate a health care proxy. A proxy can make treatment decisions whenever you’re incapacitated and cannot communicate because of temporary/permanent illness/injury, and may also access medical records depending on permissions you designate.
PROBATE
Assets in a will usually fall under probate court jurisdiction. Probate court determines a will’s validity and ensures a will’s instructions are implemented. Assets in a “living” trust can avoid probate.
Advantages
• Protection from creditors
• Fair analysis of an estate’s value
• Protection from some taxation
• Lower cost of legal counsel
Disadvantages
• Delay in transfer of assets
• Higher cost to the estate
• Public knowledge of the estate
Why Choose Attorney William Gillespie?
The decision making process regarding these legal documents can be complex. The Law Firm of William Gillespie is professional and experienced with demonstrated expertise in Probate and Estate Law and we can help you decide what’s right for you.
In practice since 1996, Attorney William Gillespie is an active member of the Plymouth County Bar Association. He earned a BSBA degree from Stonehill College and Law degree from Southern New England School of Law. He volunteers time at the Brockton Division of the Probate and Family Court as a Family Court and Probate Attorney.
In addition to Probate and Estates, William Gillespie practices Family Law/Divorce, Criminal Law/DUI, Immigration Law, Personal Injury Law, Civil Litigation, and Real Estate Law.
We offer a FREE CONSULTATION. Call (781) 344-6998; email wgillespielaw.com; or visit our website www.wgillespielaw.com.
Interpreters are available for the following languages: Cape Verdean, Haitian, Portuguese, and Spanish.
The foregoing should not be construed as legal advice.