ESTATE PLANNING

Estate planning is a process that involves advance planning for incapacity and death through the preparation of documents to minimize expense, delay, and publicity in dealing with financial and healthcare issues. The issues to be addressed will not be the same for all individuals and married couples. However, certain documents are generally executed as the core of each estate plan.

WILL
A Will takes effect upon death to govern how an individual's assets will be distributed. The distribution provisions in a Will apply to assets in the individual's name at the time of death. The Will does not govern assets in joint tenancy or assets subject to a pay on death or other designated beneficiary provision. If an individual has minor children, the Will should include a provision to nominate a guardian for the person and estate of each minor child.

DURABLE POWER OF ATTORNEY
A power of attorney is executed by the "principal" to appoint an "agent" to manage financial and legal affairs of the "principal". A durable power of attorney remains valid during the incapacity of the principal. Under all powers of attorney, the authority of the agent terminates immediately upon the death of the principal. The powers granted to the agent may be broad or very limited based on the preferences of each individual.

ADVANCE HEALTH CARE DIRECTIVE
An Advance Health Care Directive is used to appoint an individual and alternates to make health care decisions when the principal is incapacitated. It may also provide for the limitation on the use of life support when one is in a persistent vegetative state or irreversble coma. These directives also allow instructions to be given regarding organ and tissue donation and other health care concerns. Once executed, they remain valid indefinitely unless revoked.

TRUST
A Trust is a device used to hold title, manage, and provide for the distribution of assets. All trusts have one or more trustors who create the trust, a trustee and successor trustees who manage trust assets and beneficiaries who receive income or principal from the trust at times specified therein. The most common use of a trust is to avoid probate upon death of the trustor(s). Trusts used to avoid probate are generally revocable in order that the trustor(s) may amend or revoke the trust at a later time. Revocable trusts generally become irrevocable upon the death of the trustor(s).

Irrevocable trusts are often used for most complex tax planning. One common use is to hold ownership of life insurance policies to avoid inclusion of the death proceeds in the estate of the insured for estate tax purposes.