What is estate planning?
Estate planning is the creation of documents that coordinate what happens to your assets when you die or become disabled. We use wills and trusts for this. Estate planning also includes the use of advance directives such as health care directives and powers of attorney.
What is a durable power of attorney?
A power of attorney names someone, or more than one person, to take care of your finances or health care matters if you are not able. A power of attorney is “durable” if it remains in effect when you are incapacitated. Most powers of attorney are “durable”.
Can I use a power of attorney after someone dies?
Powers of attorney are invalid once a person dies. When a power of attorney ceases at death, a will becomes effective, or in some cases, a trust takes over all management and disbursement of assets.
What are the roles in a durable power of attorney?
The person who signs a power of attorney is the “principal.” The person named is the “agent” or the “attorney-in-fact,” and often a power of attorney names successor attorneys-in-fact. An agent signs a document using the principal’s name “by __ as AIF.” Or an agent may sign “by __, under POA for __.”
How do I use a durable power of attorney?
The principal who signed the power of attorney, or the agent named in the power of attorney, can give a copy to a bank or doctor, or other person or institution. Often the financial institution wants to see the original power of attorney, or a certified copy, which they may copy and keep in their files.
Should I record a power of attorney?
People often want powers of attorney recorded with the local county recorder’s office. This makes it possible to get any number of certified copies for banks or other institutions, and it prevents losing the document.
What is a health care directive?
Health care directives direct your medical wishes in advance. They are sometimes called advance directives. They can take many forms, and differ from state to state. Another name for a health care directive is a living will, or a directive to physicians. Washington State law provides a statutory form, but it can be changed in many ways.
Do I need a will?
Most people want to specify who gets their assets, rather than rely on the state presumptions. A will can name the executor or executrix (known as the “personal representative”), or guardians for children, and may contain trusts for children or grandchildren, or may contain trusts to minimize estate taxes or carry out other functions.
What happens is a person dies without a will?
If you die without a will, the State of Washington (and other states) directs who receives your assets. For example, your spouse would receive all community property. If you have no spouse, all property would go equally to your children, and if none, then to your parents, and if none, then to your siblings. Of course, estate assets are subject to taxes if taxes are due, and are subject to valid creditor claims and any costs of administering the estate.
Can a revocable living trust be used instead of a will?
Sometimes people use a revocable living trust instead of a will to direct their assets at death. Revocable living trusts are common in states where probate is difficult and expensive. They are very popular in California, and used less often in Washington State. Even with revocable powers of attorney, however, a will may be needed for assets that were never put into the revocable living trust. At death, a revocable living trust becomes irrevocable.
What is a testamentary trust?
Whereas a revocable living trust is in effect when a person is living, a testamentary trust is included in the will and only comes into effect upon a person’s death. Testamentary trusts are commonly used to support a spouse, children, or to minimize estate taxes. a special needs child or grandchild. Testamentary trusts are irrevocable, that is, they cannot be changed after a person dies.
What happens in an estate planning appointment?
During an appointment, we discuss exactly what you need and want. Often there are choices. We quote a fixed price for our services. If you decide to proceed, we draft the documents and send them to you for your review. When they are exactly as you want them, you come in to get everything signed and witnessed.
What is probate?
Probate is the process of giving effect to a will. The state appoints a “personal representative” to give effect to the will, such as paying certain bills, giving notice to heirs of the probate, transferring property as provided in the will, and so on. In Washington, the court is often not involved during most of the process. The process typically takes at least four months, during which a will contest may be filed, or creditors may file their creditor claims.
Why do probates sometimes take years?
Sometimes probates are complex because of will contests, tax disputes, or claims over ownership of assets or amounts owed. In those circumstances, probate lasts until the disputes are cleared up.
Do families often fight over money in an estate?
No, most estates close amicably without controversy, and without the court being involved. After the court verifies that the will is valid and the estate is solvent, the court is generally not involved with the estate unless a problem arises. Some few estates result in litigation.
What types of controversies come up in probate litigation?
Here are some random examples of probate disputes: A will is contested based on the alleged incompetency of the testator, or based on alleged undue influence by a beneficiary; someone files a disputed creditor claim, such as an unmarried partner or an ex-spouse who claims unpaid child support; there is ambiguity in the will language (for example, the will is not clear about which “house” was meant to go to the person named); and finally, disputes arise when a personal representative does not act fairly toward the beneficiaries. These are just a few examples.