Estate Planning

Estate planning is the term used to describe your advance planning for the control of your property while you are living (Health Care Power of Attorney, Durable Property Power of Attorney, Living Trusts), at the time of your death (Last Wills and Testaments, Trusts) and after your death (Trusts). There may be some simple steps you can take to avoid probate and expense at the time of your death.

Please remember that life insurance policies are contracts with an insurance company. The money paid on death is paid to the named beneficiaries under the policy and does not pass under your Will. The exception to this is when all the named beneficiaries have died before you or when your estate is named as the beneficiary. In those cases the proceeds are paid to your estate. The same applies to any account such as IRA account or bank accounts where you have a joint owner or named beneficiary. These accounts would pass to the joint owner or beneficiary independent of your Will.

Trusts

A Living Trust is the term for a trust for some or all of your property that you or someone else, such as a bank, control while you are living. A bank as trustee would provide management and investment help. The trust also then provides for how you want the trust property to be distributed at death without the need for probate. There are many other reasons for a trust including educational trusts, insurance trusts or control over funds after your death. The trust may be a separate document while living or be part of a Will to take effect at death. The cost for a separate trust document starts at $450 and may be more depending on complexity and time involved.

Probate

The purpose of the probate procedure is to collect the assets of the deceased, pay all final debts, satisfy the tax requirements and to distribute the assets to the proper persons according to the Will or the heirs if there is no Will. The probate procedure as set up by Illinois law provides for a legal guarantee to heirs, legatees, title companies and those who hold property of the deceased such as banks, that all legal requirements have been complied with. Estates with real estate or over $100,000 in personal property value will need to have a probate through the court system. Estates of under $100,000 in personal property and no real estate may sometimes use what is call a Small Estate Affidavit in lieu of probate. Banks, corporations or other entities that hold property of the deceased will generally refuse to turn over property of the deceased to anyone but the court appointed representative of the estate. In most cases title companies will not insure title to real estate unless the property has been through the probate process. Probate also serves to cut off any claim against the deceased after six months has passed from the opening of the estate. Attorney fees for estates are based on a time only charge and not on a per centage of the estate. Changes in the probate law has simplified the procedure and reduced the expense of probate. I provide an estimate after review of the work involved.