Everyone should have an estate plan, a legal document that names the people or organizations receiving their assets when they die.
A good plan will help your heirs avoid costly probate and leave them with the property they want. It also helps manage and minimize property taxes, such as inheritance and gift taxes.
Wills
Wills are formal legal papers that specify what should happen to your property and possessions following your passing. Additionally, they identify who should look after your young children.
A valid will is essential for residents because of the state’s strict laws about distributing your estate. A court will decide how to divide your belongings if you pass away without a will.
Your estate lawyer can assist you in ensuring that your will is created and carried out legally in California. Additionally, you should update your estate plan as frequently as you can.
A California estate planning law will have provisions for your spouse, minor children, and other beneficiaries. Additionally, it could designate a personal representative to manage the division of your assets and real estate.
Wills are a great way to give your loved ones control over how your assets are divided after death. They can help your family avoid costly and time-consuming probate proceedings. However, they are only sometimes sufficient to distribute your entire estate. They must be combined with other estate planning tools like a trust.
Trusts
Trusts are legal agreements that let you give away your possessions to anyone you choose after you pass away by transferring ownership of your assets into the trust while you are still alive. It can help avoid the hassle and expense of probate while protecting your assets from creditors’ claims.
Before deciding which trust type best suits your needs, it is vital to grasp the differences between the many trust kinds that are accessible. Your estate attorney can help determine if a trust is right for you and your family.
A revocable living trust is a popular estate planning tool in California. It allows individuals to retain control over their property during their lifetimes, then transfer it to their chosen beneficiaries after death, all while avoiding probate.
A trustee is a person or organization that manages the trust’s assets. Choosing the right trustee can ensure that your wishes are carried out as intended while protecting you from lawsuits and creditors’ claims.
Durable Power of Attorney
A durable power of attorney gives someone authority to act when they cannot decide. These documents can be helpful for anyone concerned about their health or finances, such as an older person or a child with disabilities.
A durable power of attorney is generally effective immediately upon execution. A limited power of attorney gives an agent (called an attorney-in-fact) the ability to make financial transactions on your behalf, but only within the specific boundaries set out in the document.
Durable powers of attorney are usually a good idea for people who have trusted people who can be responsible for their finances and health care needs. It can be a spouse, child, or another close family member you trust without reservation.
Name an alternate agent who can take over if the primary agent becomes unavailable is often vital. Getting the proper legal language in the document makes this possible.
Health Care Directives
When you need to get your medical care under control, having an advance directive (such as a living will and medical power of attorney) can be invaluable. They can make your wishes clear and prevent family members from having to make difficult choices under extreme emotional stress and financial burden.
Your health care directives should be updated at least every ten years. During this time, you can change your decision-makers or agents and adjust the language that expresses your values and preferences for end-of-life treatment.
For example, you may want to revoke a do not resuscitate order (DNR), change your wish to be an organ donor, or specify a specific issue for treatment, such as kidney dialysis.
These changes must be documented in writing, and you should have copies of these documents on hand. You can then use these to update your physician and family members so they know your new wishes.
Regardless of your situation, working with an experienced estate planning lawyer to create an advance directive can give you peace of mind that your medical needs will be met by the people you trust and loved ones you want. Call the Gullotta Law Group today to learn more about establishing a directive.
Asset Protection
Asset protection is critical to California estate planning because it can limit property loss from judgment creditors, commercial creditors, bankruptcies, and other claims. A good asset protection strategy combines various legal tools, such as a trust, limited liability company (LLC), family liability partnership (FLP), and retirement plans.
Revocable inter vivos trusts or living trusts are standard tools for protecting assets. However, because a revocable trust allows the settlor to dissolve the trust at any time, a creditor could reach the property within the trust.
Alternatively, an irrevocable trust is a much better option for asset protection. An irrevocable trust does not allow the settlor to dissolve the trusts, and creditors cannot access the assets within the trust so long as the settlor is not a beneficiary.
Another asset protection strategy is to move assets into more protected categories, such as life insurance, qualified retirement plans, and government benefits. Using these tools can keep your property safe from potential creditors while also keeping it available for your loved ones.
