Estate planning is not just for the rich.  Estate Planning is the process of putting your affairs in order in a way that maximizes the benefits of the assets to provide for your family after your death. Estate planning is important for all families in order to insure assets pass to whom you want after your death, to reduce the tax burden on the estate and to avoid delay and costs when assets pass after your death.  Estate planning is especially important in families where there are significant assets or a family business.

Every person needs a Will and possible a Trust, a written agreement regarding assets, a Durable Power of Attorney and instructions regarding your passing.  Regardless of status, every person needs an estate plan.  Start planning for your future today.

A Trust is simply a document that explains how assets are going to be dealt with and who will arrange the benefits and who will be the beneficiaries of these assets.  The advantages of placing assets in Trust are to avoid Probate, retain privacy of family assets and avoid reduction of benefits due to taxes.

Without a Will or Trust, assets will be subject to the probate process, higher estate taxes and assets may not be distributed as you envisioned.  Additionally, probate is expensive and takes time, having the proper documents in place means that your family will not be waiting around for money after your death.  Plan for your family’s future.

If you die in the State of Minnesota without a Will, the State decides who receives your property by default.  In Minnesota, that is typically your spouse and children.  Having a Will or Trust in place allows you to avoid the state’s default plan and put assets where you wish.

Additionally, a Will or Trust allows you to designate a guardian for minor children, designate an executor of your Will and acknowledge a child that they state may not automatically provide for, such as a stepchild.  Consult with an estate planning attorney before drafting a Will or other legal document.

Probate is a court proceeding that occurs after a person passes away without leaving a Will or Trust explaining where to send his or her assets.  Probate is done in a state court and it changes the title of the deceased’s assets into the name of the proper living beneficiary.  The state court also settles the debts of the deceased.

Probate can be a costly and time consuming process.  Assets can be tied up in the probate process for several months and the assets will be reduced.  Plan for your future and the future of your family and protect them by setting up documents to avoid the probate process.  Call an estate planning attorney today to help set up estate planning documents.

A living trust is created while the trustee is still alive and allows the creator to remove or amend it whenever they wish to do so, referred to commonly as a revocable living trust.

Upon death, the trustee of the living trust is director to distribute the trust as described or may continue to hold it for the benefit of your beneficiaries.  Unlike a Will, a living trust can also provide a vehicle for managing property during life and authorized a trustee to manage the property and use it for you and your family’s benefits if you should become incapacitated.  This is referred to as an incapacity clause.

Talking to an estate planning attorney can help you decide what type of estate planning documents and approaches are right for you.

A Power of Attorney authorizes another person to act on your behalf.  A Power of Attorney document can be limited to a single activity, such as making health care decisions for you during a surgery, or a Power of Attorney can be more broad and give a more blanket power to for someone to act on your behalf in case you become incapacitated.

A Power of Attorney is a very important document in Estate Planning but can have serious legal consequences.  Consulting with an attorney before drafting such an agreement is crucial.

A healthcare directive is a document that informs doctors and your family what your preferences are regarding your healthcare.  A healthcare directive allows you to specify what type of treatment you want and specify what treatments you want receive (or do not wish to receive, such as extraordinary measures to keep you alive).

Additionally, you can choose a healthcare proxy in your healthcare directive.  By declaring a health care proxy, you appoint a person to make decisions for you if you are not able to do so due to incapacity.

The gift tax exclusion allows individuals to give away assets each year without having to pay a gift tax.  Each year, an individual can give away $13,000.00 per recipient.  This can be a way to reduce the amount of assets that will be part of the estate.  There is no limit to the number of recipients to which qualifying gifts can be made.

Before making gifts to reduce the amount of your estate, consult with an Estate Planning Attorney.