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The Law Office of Ellen T. Chadwell offers estate planning for clients whose anticipated estates are valued at less than $2 million. This planning process is initiated with a consultation and preparation of an information sheet listing a client’s assets, liabilities, income sources and personal information about the client, family members and intended beneficiaries.
Avoiding Probate
The goal of this planning is to avoid probate of a client’s assets when possible. Probate administration applies only to those assets titled solely in the decedent’s name or owned with others without rights of survivorship or a transfer on death provision (“Probate asset”). For example, a checking account in both husband and wife’s name will become the surviving spouse’s property and is not a probate asset. While many people assume that probate is always needed when a person dies, this is often not the case.
Assets like an investment account or a Certificate of Deposit will have a designation of beneficiary, which can be completed by the owner during his or her life as part of an effort to avoid probate.
In the consultation, clients discover how to title their assets or provide for the transfer upon death of these assets so as to avoid a costly probate. In many cases, this will include affordable legal mechanisms such as an Enhanced Life Estate Deed, also known as a “Lady Bird Deed,” or a Revocable Trust.
A Lady Bird Deed provides a future interest in real property to children or any person the client chooses, while allowing the client to retain full powers and rights of ownership as long as he or she is alive. The advantage of this mechanism is it preserves the owner/client’s ability to mortgage, sell, and even destroy the property without any consent being needed from the future interest holders or any liability to those future interests.
In addition, the children or other designated future interest holders enjoy the same stepped-up basis in the property they would otherwise enjoy if they received the property as a result of the owner’s death or through probate.
A Revocable Trust or Living Trust permits the client (called “Settlor” or “Grantor” in the trust document) to leave property to those beneficiaries named in the trust, and under any condition he or she chooses.
Upon the Settlor’s death, the trust document designates a successor trustee. The trustee may be directed to distribute the assets owned by the trust outright to the beneficiaries or may provide for the distribution until a variety of conditions. One common condition is the age of the beneficiary.
A trust, however, can only transfer what it owns. If property is not titled or assigned to the trust during the Settlor’s life, those assets will need to be probated unless otherwise transferred through pay on death agreements.
Failing to ensure that one’ assets are owned by the trust at death can defeat the very reason for the trust’s creation. It’s important to talk to your attorney regarding the details of managing a trust and whether a trust is right for you.
In addition, clients are encouraged to plan for instances when they can no longer act on their own behalf. Ms. Chadwell provides Durable Powers of Attorney, Declarations of Pre-Need Guardians and Healthcare Surrogate Designations and Advance Directives at a flat and discounted rate.
Important Planning Documents
An Advance Directive is commonly called a “Living Will,” and is a necessity for every person to ensure that life is not prolonged unnecessarily and against a person’s wishes.
The Healthcare Surrogate Designation, also known as a Healthcare Proxy or Healthcare Power of Attorney, is another important document to have. It provides your agent with access to all medical information otherwise protected by HIPAA, permits consultations with your doctor and grants your agent authority to make health care decisions for you, including end-of-life decisions.
While many hospitals or day surgery facilities will offer these documents to you for completion, these documents generally stay with that facility. If you have not had to undergo a procedure or surgery of any sort or have otherwise been healthy, you may not have signed such a document and it is important, especially for unmarried persons, to designate an individual to make such decisions in the event you are unable.
A Durable Power of Attorney grants the named agent authority over the client’s financial assets and is effective immediately and continues when the client loses mental capacity. A durable power of attorney can allow a spouse or other appointed agent to make financial decisions when the client is no longer able or willing.
This document can also be drafted to provide the agent with sufficient authority so as to qualify the client for badly needed Medicaid or other federal benefits. It is important to have such a document in place if a person starts suffering from cognitive decline or abnormal memory loss. Waiting until a loved one is in a memory care facility may be too late.
A Declaration of PreNeed Guardian is one of my priority documents for clients who do not have biological children or spouses, or belong to a blended family. If you’re not married to but are living with your partner, who has biological children from a previous marriage, those children could be entitled to priority consideration by the court absent this Declaration.
If the client should become mentally incapacitated and a guardian is needed in order to make decisions for the wellbeing of the client, this document declares the client’s determination of who best will serve as his or her guardian and directs the court to appoint that person.
Although a Durable Power of Attorney and a durable Healthcare Surrogate Designation can provide the authority needed to care for an incapacitated loved one, a Declaration of Pre-need Guardian is a failsafe protection most clients should not overlook.
A Declaration of Preneed Guardian for Minor Children is also an important document for designating guardians for one’s children in the event of the death of both parents.
A Last Will and Testament is a necessary component to any estate plan, even if you have titled your assets so probate of your will is not anticipated. A Last Will and Testament is a document that states who gets your assets when you die and is important for ensuring that all assets that do not transfer automatically upon your death are distributed to people you have chosen and designated in your will.
Unfortunately, most people don’t even consider the creation of a will until they are middle-aged or facing a life-threatening illness.
Your Will appoints a person to serve as your Personal Representative (called “executor” in other states), and that individual will then be in charge of marshalling your assets, paying your debts, and distributing your property in accordance with your Will. A will can even dictate what you want done with your remains.
A Will is especially important in a blended family scenario or for single persons without children. In these instances, any solely owned assets not transferred upon death through a POD or designation of beneficiary will be distributed per the intestate statutes of Florida. These statutes direct that absent a surviving spouse or children, all assets will be distributed to a decedent’s surviving parents, siblings and nieces and nephews, whomever survives the decedent in that order of priority. In this scenario, life partners or unrelated parties will receive nothing without a will.
The Law Office of Ellen T. Chadwell will prepare and oversee the execution of your Will for an affordable fee of $250. When combined with other estate planning documents, such as a durable power of attorney and a health care surrogate designation and living will, this cost can be reduced by half.
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