What will happen to your belongings after you pass? Who will care for your children? Planning for the future is crucial. That’s where wills, trusts and estate planning come in. A will and other estate planning documents ensure there’s a plan in place for your care, assets and dependents in the event of incapacitation or death. Here’s what to know about will planning and estate planning.
What is will planning?
Will planning is the process of creating a will, a legal document that states what should happen to your belongings in the event of your death. It can be a standalone document or created as part of an estate plan. An attorney in the state of Ohio can help with will planning so you’re confident that your wishes will be carried out in the future.
What’s included in a will?
A will, also called a Last Will and Testament, is an important legal document that dictates how your affairs will be handled. It lays out a plan for who will receive your material, financial and business assets plus how and when those assets will be distributed. If you have children, your will can include a plan for who will take on the responsibility of caring for them. You can also name an executor, the person who will oversee the distribution of your property, pay any tax or debt, and make sure your will is properly carried out.
Why do I need a will?
A will ensures there’s a plan in place for how, when, and to whom your assets will be distributed as well as the care of minor children. Without a will, state law will instruct for your belongings to be distributed in a way you have no control over. A will gives you peace of mind and gives your family a plan for what to do.
What’s the difference between a will and a trust?
Wills and trusts are similar, but they do have differences. These include when the assets are distributed to your beneficiaries and whether or not they’re distributed through a probate process. Depending on the size of your estate, your assets and your dependents, you may need a will, trust, or both.
After your death, your belongings are distributed through the probate process. Probate can be time-consuming, but having a will helps it go faster and ensures your plan for your belongings is followed. A state probate court judge will confirm the legal validity of your will prior to assets being distributed. Wills can be contested, so it’s important to have an attorney assist in the will planning process.
There are four main types of wills: simple, joint, living, and testamentary trust. A simple will creates a general plan for who gets what and when, as well as who will look after your children. A joint will is a will that two people sign together. A living will states what kind of medical treatment you want to be given in the event you become incapacitated. A testamentary trust is created by your will and requires assets to be distributed through the probate process.
With a trust, your assets are managed and distributed outside of the probate process. Rather than assets being given to heirs upon your death, you can instruct for assets to be held in a trust until a specified date. For example, you might want a trust if you have a large financial asset to give to your child when they turn 18. A trustee of your choosing will manage the assets in the trust until it’s time for them to be given to the beneficiary. A trust also protects your assets from creditors and, unlike a will, a trust typically can’t be contested.
What is estate planning?
Estate planning is the process of creating a plan for your estate after you pass or if you become incapacitated. An estate includes material items like your home and other owned property, furniture, appliances, vehicles and more. It also includes financial assets like investments, savings accounts and checking accounts, and may include business assets. An attorney familiar with state probate law can help you set up a future plan for your estate.
What’s included in estate plans?
An estate plan is broader than a will or trust and includes a variety of legal documents; these may include a will, living trust, power of attorney, advanced medical directive, letter of intent, beneficiary designations, property transfer, business transfer and more.
Advanced medical directive
Including an advanced medical directive in your estate plan ensures people know what you want to happen if you become terminally ill and can’t voice your own wishes. This document will state what treatments (such as life support) you do or don’t want plus other guidance for medical professionals. You can also state who will be your medical agent, the person designated to make medical decisions on your behalf.
Power of Attorney
A power of attorney is a legal estate plan document that states who, on your behalf, can make decisions about your finances, property, healthcare and more. Common types of powers of attorney include general, limited, durable and springing.
General: allows you to name an agent who will act on your behalf in a wide range of events, such as when certain bills need to be paid or if someone needs to sign legal documents.
Limited: gives an agent permission to sign papers or act on your behalf solely in specific scenarios.
Durable: identifies who can make decisions for you even if you become incapacitated. This is different from other types, which stop being effective if you become incapacitated.
Springing: gives an agent permission to act on your behalf only during a specific future event. This can be durable or non-durable.
Healthcare Power of Attorney
A healthcare power of attorney is a legal estate plan document that names an agent who is allowed to make healthcare-specific decisions on your behalf. This person will communicate your wishes with doctors and other medical professionals to help ensure you don’t receive unwanted medical treatments.
Which Power of Attorney type is best?
The best option for you depends on your specific circumstances and needs. An estate planning attorney will help you decide which is right for you.
Why do I need an estate plan?
An estate plan offers you peace of mind knowing that your affairs will be properly handled. It covers a much wider scope than a will alone. Estate plans make sure your wishes for the future are clear so people don’t have to guess and make the probate process easier. An estate planning lawyer in the state of Ohio will help you create a thorough estate plan.
Who needs wills and estate plans?
Everyone benefits from having a will or estate plan. These are especially important if you’re married, have kids, and/or have large finances or many assets. An estate plan will ensure your belongings go to the right people at the right time and your wishes for the future are carried out. An attorney in the state of Ohio will help you create a will or estate plan and help you update them as you experience life changes.
What if I’m young and healthy?
While not required, an estate plan is always a good thing to have. If you’re young, healthy, unmarried, don’t have kids, and don’t have many assets, the need for planning a will, trust or estate plan may not be as pressing. However, without a will, trust or estate plan, there are no legal documents expressing your wishes for any assets you do have or your desires for future medical care. You never know what the future holds, so it’s best to be prepared.
What happens if you pass without plans in place?
If you pass away without planning a will, this is called dying “intestate.” In this event, the state court determines the value of your assets and distributes them how they see fit during the probate process. This may differ from how you would prefer your assets to be distributed.
Wills and estate plans are important
Wills planning and estate planning ensures your assets are distributed how, when, and to whom you want. These plans also state your wishes for medical care if you can’t express them yourself. Having a will or estate plan also typically reduces the amount of estate tax owed, shortens the probate process, and makes the process easier for your loved ones during an already difficult time.
How does estate planning work?
Estate planning attorneys will work with you to create a will or estate plan that fits your needs.
The planning process
Your attorney will discuss the benefits and differences of a will, trust, and other estate planning documents. They’ll also get to know you, your needs and goals, make a log of your assets and debts, and identify tax credit options. Once you determine the necessary legal documents, your attorney will help you fill out these legal forms. You will then sign the papers, and two witnesses will sign. If you like, you can mail a copy of your estate plan to your personal representative.
Trust Taneff Law with your will and estate planning needs
Working with the right lawyers can make estate planning much easier. Thomas Taneff is a former Probate Court Magistrate and well versed in state probate law. He has years of experience helping people in the state of Ohio create a plan for their material and financial assets for after their death and will address your planning needs. Taneff Law Firm is here to help with will planning, trust planning and estate planning.
Contact Taneff Law to learn more about planning a will, trust or estate plan.