Probate is the court process that oversees the management and distribution of a person’s estate following death. Its purpose is to appoint a personal representative, prove the validity of the decedent’s will (if one exists), oversee the payment of creditors and taxes, and order distribution of the decedent’s estate. Probate proceedings can be expensive and time-consuming. Additionally, the court proceeding and associated documents are all a matter of public record. Many people choose to avoid probate to save money, spare their heirs a legal hassle and keep their personal affairs private.
This is the most common form of asset ownership between spouses. Joint tenancy (or Tenancy by the Entirety) has the advantage of avoiding probate at the death of the first spouse. The surviving spouse should exercise great care when considering adding other relatives as joint owners. Doing so may subject their assets to loss through the debts, bankruptcies, divorces and/or lawsuits of any additional joint tenants.
The document a person signs to provide for the orderly disposition of assets after death. Wills do not avoid probate. Wills have no legal authority until the willmaker dies and the original will is delivered to the Probate Court. Special testamentary trust provisions in a will can provide for the management and distribution of assets for your heirs. Additionally, assets can be arranged and coordinated with provisions of the testamentary trusts to avoid death taxes. Most importantly, a willmaker can name guardians for minor children if both parents pass away.
Sometimes called an Advance Directive, a living will allows you to state your wishes in advance regarding what types of medical life support measures you prefer to have, or have withheld/withdrawn if you are in a terminal condition (without reasonable hope of recovery) and cannot express your wishes yourself. Oftentimes a living will is executed along with a Designation of Health Care Surrogate, which gives someone legal authority to make your health care decisions when you are unable to do so yourself.
If you die without even a Will (intestate), the Florida legislature has already determined who will inherit your assets and when they will inherit them. You may not agree with the states plan, but roughly 70 percent of Americans currently use it.
You may avoid probate on the transfer of some assets at your death through the use of beneficiary designations. These assets are typically governed by a contract. Some common examples include life insurance death benefits and bank accounts.
These allow you to appoint someone you know and trust to make your financial decisions on your behalf. If you are incapacitated without these legal documents, then you and your family could be involved in a court proceeding known as a guardianship. This is the court proceeding where a judge determines who should make these decisions for you under the ongoing supervision of the court. It is a costly process that can be avoided in most cases.
This is an agreement involving three parties: the person who creates the trust (called settlor, trustor or grantor), the Trustee (the manager of trust assets) and the Beneficiaries (those who are to receive benefits of the trust assets, such as trust income). The overall purpose of the revocable living trust is to provide for the management of assets during lifetime and to direct the distribution or ongoing management of assets on death. For example, a husband and wife may serve as all three parties to create their trust, manage all the assets transferred to the trust, and have full use and enjoyment of all the trust assets as beneficiaries. Further "back-up" managers can step in under the terms of the trust to manage the assets should the couple become incapacitated or die. Special provisions in the trust also control the management and distribution of assets to heirs in the event of the settlor's death. With proper planning, the couple also can minimize or eliminate death taxes on their estate. The Revocable Living Trust may allow them to accomplish all this outside of any court proceeding.
Whether you are young or old, rich or poor married or single, if you want to avoid court interference at your death or incapacity, consider a revocable living trust.
Medicaid Planning involves developing a plan to reallocate your assets in such a way that Medicaid will not take them into consideration when determining your eligibility for coverage. If you need nursing home care in the future, you will qualify for Medicaid coverage rather than having to deplete your own resources to cover the costs.
According to the National Academy of Elder Law Attorneys: “Elder Law and Special Needs Law attorneys focus on the legal needs of the elderly and people with disabilities, and use a variety of legal tools and techniques to meet the goals and objectives of their clients. Elder Law and Special Needs Law attorneys typically work with other professionals in various fields to provide their clients quality service and ensure their needs are met. Using this holistic approach, for example, an Elder Law practitioner will address general estate planning issues and will counsel clients about planning for incapacity with alternative decision making documents. This attorney will also assist clients in planning for possible long-term care needs, including nursing home care. Locating the appropriate type of care, coordinating private and public resources to finance the cost of care, and working to ensure the client's right to quality care are all part of the Elder Law practice.”
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