The Lowrey Law Firm helps you to assure that your wishes are respected, your legacy preserved, and establish a plan for a smooth transition to your spouse and heirs while minimizing court interaction. Examples of Nevada estate planning might include a simple will, a complex will, a power of attorney and a Nevada asset protection trust.
What is Estate Planning?
There is more to Estate Planning that writing a simple Will. Estate planning is the process of anticipating and arranging, during a person's life, for the management and disposal of that person's estate during the person's life and at and after death, while minimizing gift, estate, generation skipping transfer, and income tax.
What is Life Care Planning?
For seniors, good planning means dealing with lifetime needs first. Traditional estate planning is different because the focus there is on after-death issues. Things to consider for Life Care Planning are:
- Long term care needs
- Incapacity planning
- Asset preservation
After these needs are met your estate plan then considers transfer of assets to your beneficiaries quickly and usually with minimum tax consequences.
Do It Yourself?
"Ninety percent of the online estate-planning documents I see don't do what the people think they're going to do," says Leanna Hamill, an estate planner and elder law attorney in Hingham, Mass. "I've seen people use online documents, documents out of estate-planning books or documents borrowed from friends. But they screw up their estate plan because they don't understand the legal and technical aspects of the documents."
Do I need a Will?
To state the obvious, everyone will eventually die. Yet nearly 60% of adults fail to make a Will. We often hear the news that a celebrity has died without a Will. For example, Jimi Hendrix, who died in 1970 did not have a Will and the battle over his estate had continued for over 30 years. NFL player Steve McNair, only 36, died when he was shot and killed by an ex-girlfriend, did not have a Will. At the time it was reported he had had a serious relationship with another woman. Because there was no Will, the woman with whom he was serious was completely cut-out. Another famous example was Howard Hughes who died without a Will and the Court battles over the estate was news for many years. Recently, Aretha Franklin passed-on with making a Will and the task of administering and distributing her estate will be entirely in Court, lengthy and expensive.
Not a Celebrity? Sorry, You still need a Will.
You might say to yourself, “I don’t have an estate of any size and a Will is not necessary for me.” Here is an example that I have heard that may give you a reason to reconsider.
A mother dies leaving two adult daughters. The daughters have fond memories of their mother’s baking and of an often used yellow pie plate. The mother died without a Will and the division of her property was then left to the Courts and state law for intestate succession (meaning distribution of a decedent’s property when there is no will). Both daughters wanted the yellow pie plate, but of course only one daughter could have it. It has been 15 years since the Court award the plate to one of the sisters – they have not spoken to each other since.
Another example. Suppose you die in a car wreck caused by a drunk driver. Your estate may have a wrongful death suit against that driver. A Will would determine who might receive a recovery from the law suit, otherwise the distribution would decided in Court, possibly taking years and incurring significant legal expenses.
Practical Reasons you need a Will
It is the Responsible Thing To Do
Don’t leave all of your after death decisions to others. Avoid family disputes. Take charge and direct what will happen to your remains, your assets and your gifts.
You decide how your property and family heirlooms will be distributed
Without a Will, your property that is subject to probate and will pass to those persons Nevada statutes deem to be kin, in a specific defined order of priority. This means that someone with whom you have a close relationship, like a significant other, could be excluded.
You can disinherit persons
Sometimes you wish to assure that your property goes only to the people important to you, but not others, regardless of their kinship. A will gives you that power.
You decide who will take care of your minor children
Important! If you don’t have a Will and you die, the Court will determine who will have custody and be responsible for raising your children.
Pets – Who will care for them?
A Will can tell the Court who will get your pets if you die. Note: A trust is sometimes a better vehicle for assuring the care of your pets after you are gone.
Avoid a lengthy probate process
All property that expressly passes outside of probate, must be distributed through the Court. A Will makes the process easier and faster.
You decide who will wind up the affairs of your estate.
In your Will you appoint an Executor. This person will make sure your affairs are in order, pay any bills, cancel credit cards and notify you bank etc.
Tomorrow is not Promised
If you make a Will, you can change you mind about who receives your legacy at any time by rewriting the Will. Conversely, if you do nothing and you pass-on, it will be too late for your wishes to be expressed and carried out.
Reasons you Need a New or Revised Will.
Death of a spouse
Modern estate planning relies heavily on spousal provisions to avoid taxation and remove property from probate. On the death of a spouse the estate plan should be at a minimum be reviewed and perhaps rewritten base the survivor’s current and expected circumstances.
Death of a child or beneficiary.
When a child predeceases a parent, consideration should be given as to whether the distribution resulting from an older Will are still relevant.
Divorce, Marriage and Domestic Partners.
Today many families are blended. Wills made before a divorce may, and likely do, have provisions for inheritance, gifts and care of minors that need to be reworked because of the change in circumstances. On remarriage, each person will have assets, income or business interest acquired before remarriage. Decisions need to be made as to which assets will remain separate property or become joint property and how the property will be distributed on the death of either, in consideration of both natural and step-children.
Divorce or Remarriage of an Adult Child.
When an adult child divorces or remarries there may be circumstance and reason that you do not want your estate to go the adult child’s new spouse or to his/her children from a prior marriage. You may have affection for your adult child’s ex-spouse and may want to make some provision in your Will for that person. You may want all of your estate to go to your natural grandchildren and not to the children of the new spouse. For any of these reasons, you should have a new Will drafted to carry out your wishes.
Why use a Trust?
A trust is a flexible planning tool that can be arranged in many ways and can specify how and when assets pass to a beneficiary.. A trust does not go through probate, may save estate taxes, and can be designed to carry out your wishes. You can name yourself and control the trust assets during your lifetime, even making changes as you desire. Because the trust property does not go through probate, distribution to heirs can be quick and the details can remain private.
“Estate Planning” is not just for the very rich. Because of the complicated nature of our legal system, even persons of modest means need a written document, custom tailored to their situation. A one size fits all approach doesn’t work when it comes to your financial future and the preservation of assets for you, your spouse and your family.
Think about Your Business Interests
Failing to consider your business as part of your estate plan. Common issues are improper transfer resulting in income taxes, dissent among surviving children over income and deciding who among the children will take over and run the day to day operations of the business.
Making out right gifts instead of leaving the property through a trust.
A properly drafted trust can both provide for your spouse and your children and at the same time protect them from waste. Example: A father wanted to assure a son with a drug problem was cared for after the father's death. His Will gave $250,000 cash out right to his son. Within the year the son had spent all of the money and was now penniless. A trust could have assured that father’s hard earned money would last for the son.
Neglecting to Update your Estate Plan.
Over time family members and dynamics change. Over time, the law changes. A trust plan adequate when your children were young no longer works when you are a senior and need to plan for your own comfort and care in old age.
Waiting for a time of Crisis or Emergency.
An estate plan can be put in place at any time before death, and have a better asset protection result than if nothing had been done. There is a very big “but…”. Waiting too long reduces the options available. For example, waiting until mental capacity is greatly diminished may require the appointment of a guardian for financial and/or physical care. If long term care is needed, state and federal laws penalize persons whose property not transferred or put into a trust within 5 years of the need for such care. If you can see that physical or mental incapacity is in your future, the sooner you get a plan in place the better for both you and your family.
Get a Conversation Started.
Parents and children are often reluctant to speak of death and a plan for distribution of property after death. This is a mistake. Parents should speak of their wishes and let children know of their wants, needs and legacy plan in advance. Children should encourage parents in this discussion. Not because the children are being “nosy” or greedy, but in order help to carry out the parent’s wishes. Advance discussions can avoid post death disputes and hurt feelings.