Estate planning is dictating what you would like to happen with your assets in the event of death. If you don’t have a will, trust, or any other valid documents, then the state will come in and determine what happens with your estate, and it will be subject to probate. It is a typically long and drawn-out process for your assets, and could wind ultimately going to your state if you don’t have an estate plan. While the state ending up with your estate is a last resort, most states work to ensure your assets are transferred to someone other than the state. However, if your property does end up passing through intestate succession, and depending on your state laws, your property will likely go pursuant to statutory law to a spouse, children, other family members, or next of kin.
What Basic Estate Planning Components Should Typically Be Included In Everyone’s Estate Planning Documents?
First and foremost, a legally binding will directing where you would like your assets transferred. The will can be complicated or straightforward and may include a trust. You may want a trust or a combination of a will in a trust, depending on how you want your estate plan to play out. You would also want to consider adding a power of attorney, a durable power of attorney, or healthcare proxy to handle matters if you become incapacitated or need someone to make certain decisions on your behalf.
Within your estate plan, essential components will be making sure that it abides by statutory rules so when you’re gone and you can’t do anything about it, something isn’t invalidated in your will for any reason. For example, some states have laws that do not allow for disinheritance, meaning you cannot, in your will, directly state that you do not want a specific person to receive anything from your estate. Some courts will automatically remove that language if you do that. A workaround can be that you don’t state such desires in your estate documents, or simply direct your estate to someone else.
There are nuances and tricks of the trade that will make a significant difference in your estate plan, but the essential planning components are a will, trust, power of attorney, and healthcare proxy.
Let’s Talk More Specifically About Different Types Of Trusts. Let’s Talk About The Most Common Types And What Protections They Would Offer?
Trusts can either be revocable or irrevocable. A revocable trust is a trust that can be revoked, changed, or canceled at any time by the creator of that trust. An irrevocable trust is a trust that can’t be modified or withdrawn without permission from its beneficiaries. Once you create an irrevocable trust, the grantor of that trust relinquishes ownership and control of the assets within it.
There is also a testamentary trust which is established within your will. So, it will have language that typically appoints a trustee to manage and distribute assets of a trust to a specific beneficiary. You’ll see that many times when someone, for certain reasons, you may not feel is trustworthy enough with finances or maybe have mental health or other issues and will need their inheritance managed for them. A special needs trust is another option for dependents who have special needs to ensure they are taken care of.
Ultimately, your typical trusts are those within a will-a testamentary trust, a revocable or irrevocable trust, and sometimes you have a pour-over will, which is where the assets from the will roll over into a trust.
For more information on Estate Planning Law In Florida, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (904) 831-1030 today.
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