Wills and Trusts
Simply, a will is the document that you use to determine who should take your property upon your death. If someone dies without a will in Kansas, the State of Kansas decides who should get the deceased person’s property. In a worst-case scenario, the State of Kansas will take that property. Everyone needs a will.
A will is a means to take control over things that will happen after your death. First, who will take your property? But there are so many other matters that you can control by properly executing a will.
If you die:
- Who will manage your property?
- Who runs your business?
- What happens to your joint accounts?
- Should your children get their inheritance immediately, or should it be distributed over time?
- Who cares for your children?
- Who cares for your pets?
We could go on, but the circumstances and questions to be answered differ for everyone. The Law Office of David J. Brown, LC, works with every estate planning client individually to craft a will that will best meet the client’s needs and desires.
When you hire The Law Office of David J. Brown, LC, to assist with estate planning, it is important to gather information about that client.
1. The first step is to complete our estate planning questionnaire. That form is designed to:
- Provide information to us about your assets so that we know what they are and can provide the appropriate assistance and planning to minimize the tax consequences of your bequests.
- Provide information about where your assets are so that in the event of your death we can locate them.
- Detail the nature of your relationship with relatives and provide addresses so that in the event of some catastrophic emergency we know how to contact them.
- Give us the guidance we need about your wishes.
2. After that, we generally meet with you to clarify your intentions and needs.
3. Then we draft documents that are mailed to you for review.
4. After review, and any revision necessary revision, the documents are signed in our office.
For the signing, we ask you to bring along two adults who know you to serve as witnesses. Our goal is to make certain that those witnessing the process can truthfully say they know you and that you are taking this important step of your own free will. Strangers cannot generally make those same claims. During the process, no information about the actual content of any documents signed is revealed to the witnesses, so your confidentiality is maintained.
At the same time you have us draft your will, we will strongly encourage the preparation of several other documents:
- A power of attorney for heath care decisions. This is a document where you designate the person or persons who should make health care decisions for you in the event you cannot make your own decisions.
- A power of attorney for financial matters. This is a document where you designate someone to manage your financial affairs in the event you are unable to do so.
- A living will. This is a document where you give instructions about the kinds of measures you want taken, or not taken, in the event you are in a terminal condition.
Trusts are very powerful tools for estate management and planning. Indeed, trusts can be established for hundreds of purposes. The first warning about trusts, however, is that they are not for everyone.
Late-night-television watchers and others frequently call our office saying they want to establish a trust “to avoid the high costs of probate.” While avoiding excessive probate costs is a reasonable goal, in Kansas, probate costs are not generally excessive. Setting up a trust, however, can be expensive.
The best way to avoid probate costs is to have an effective estate plan in place. For most people, a will, powers of attorney, and a living will are sufficient. With these documents in place, probate will usually only be unduly expensive if someone comes forward to challenge the legitimacy of the will or the estate distribution set forth in that will. If a trust were in place rather than a will, there would be similar expenses incurred if that same person were to come forward and make the same claims in challenging the legitimacy of the trust or the distribution of assets required under the trust.
The Law Office of David J. Brown, LC, works with you to determine the right estate plan for you. Once you have completed our estate planning questionnaire we will be in the best position to advise you about reasonable options. Then, if a trust appears to be appropriate, we will move forward.
Some of the kinds of trusts we have helped clients establish include:
- A living trust. A living trust is a revocable trust created during your lifetime, sometimes called an inter vivos trust. A living trust becomes irrevocable upon your death. This kind of trust has no effect on tax liability but is effective for managing property. If you create a living trust, you will transfer all of your assets to the trust. Even though you have this kind of trust, you will still need a will.
- A trust for children. Generally, these trusts are irrevocable and designed to transfer assets to minors while also protecting those assets (with a spendthrift clause) from potential creditors once the minors are adults. A trust for children can be an effective tool for transferring appreciating assets to children and reducing the inheritance tax liability of parents when estates are large enough for assessment of inheritance tax liability.
- A life insurance trust. These irrevocable trusts are used to purchase and hold life insurance policies. They are frequently created to provide tax-free funds to pay estate taxes or provide immediate liquidity for an estate.
- Charitable trusts and charitable remainder trusts. These trusts are used to transfer assets to charities and in some instances to allow you to keep the income from assets while the charity owns the asset. The tax benefits of these trusts will vary depending on the specific terms and beneficiaries of the trusts.
- A special needs trust (or supplemental needs trust). These irrevocable trusts are designed to provide funding to disabled persons that will not be counted as income or property when determining whether the disabled person qualifies for governmental assistance.
It is sometimes helpful for clients to understand that trusts can be created separately, or by will. In other words, there are many planning options. The advice of an attorney experienced in estate planning is critical. The Law Office of David J. Brown, LC, has been providing guidance in these areas since its formation in 1992.
Further, the laws governing various trusts and estate planning tools change frequently. The Law Office of David J. Brown, LC, tracks legal changes and when appropriate, notifies clients if it appears new laws may affect their estate planning goals.
If you have any questions about these topics, or you want to discuss your current estate plan, or future estate planning needs, please contact us to set up a consultation appointment. We can help.