Leatherman Law Group is a small and intimate law firm offering personalized, affordable estate planning services. Glenda Leatherman believes in focusing solely on the preparation of a plan unique to you for administering your legal affairs during life, including both financial matters and emergency medical care, and the disposition of your estate upon death.
Your will is the linchpin of your overall estate plan. If you were to die without a will, you have left no direction as to how and to whom your assets are to be distributed. This is called“dying intestate," and it results in state law determining how and to whom your assets are distributed.
If you have an estate without significant assets and also do not have any children, a will, along with a financial power or attorney and an advance health care directive, is probably sufficient for your needs.
Has legal authority only upon your death. A will cannot help manage your affairs for you if you are incapacitated.
Does not help an estate avoid probate. A will is the legal document submitted to the probate court, so it is a trigger to the probate process and exhorbitant fees.
Is the perfect vehicle to nominate the guardians of your minor children if they are orphaned. If you leave this to chance, your children could end up with guardians that you do not approve of.
There are many kinds of trusts. They can be simple or complex, and serve a variety of legal, personal, investment or tax planning purposes.
A trust has at least three parties: the person who makes the trust (trustor), the trust manager (trustee), and the trust beneficiary. In some instances, all three parties are represented by one person or a married couple. In the case of a revocable living trust, for example, a person may create a trust and name themselves the current trustee who manages the trust assets for their own benefit.
A major advantage to establishing a trust is to avoid the time-consuming and costly probate process. In most cases, assets owned in a revocable living trust will pass to the trust beneficiaries immediately on the death of the trustor without probate. Certain living trusts may result in tax advantages both for the trustor and the beneficiary. They also may be used to provide for someone else to manage and invest defined property for the trustor(s) and the named beneficiaries. If well drafted, another advantage of living trusts is their continuing effectiveness even if the trustor dies or becomes incapacitated.
Some of the more common trusts are revocable, irrevocable, living, testamentary, generation skipping, Q-Tip, and spendthrift. In addition, trusts can be created for the sole purpose of caring for a special needs child or your family pets after your death.
Probate is the court-supervised proceeding used to transfer your assets to your heirs or beneficiaries. Probate can be an expensive and time-consuming process, and can result in gift, estate, and income tax liabilities.
When your estate has assets of more than $150,000 and is not held in any trust, upon your death it must go through the probate process. This is true whether the assets pass according to the terms of your will, or absent a will, through the state's laws of intestate succession. Thus, it really is better to have a will that expresses your wishes; otherwise your assets may end up in the hands of someone you don't necessary want them to.
If your estate is worth less than $150,000, your assets may be transferred to your sucessors without formal probate. Under the California Probate Code, they can present a "Small Estate Affidavit" to the person or institution having custody of the property.
At times, it is important to protect an individual’s personal and financial well being if they are not able to protect themselves. It usually starts when you notice someone in your family who is being taken advantage of or who seems unable to take care of the basic requirements of daily living.
A conservatorship can be created by the court to protect an incapacitated adult. (Note: when the individual is a minor, it is appropriate to seek a "guardianship.") A conservatorship is a court-supervised relationship between an incapacitated person and one who is appointed to look after that person’s needs.
To appoint a conservator, the court must find by clear and convincing evidence that the conservatee is unable to:
Properly provide for his or her personal needs;
Manage financial resources; or
Resist fraud or undue influence.
Obtaining a conservatorship can be expensive, time-consuming, and embarrassing to the incapacitated person, but in many instances it is necessary.
Advance Health Care Directives (AHCD)
The Durable Power of Attorney for Health Care is now called an “Advance Health Care Directive” (AHCD). An AHCD is a document that specifies the type of medical and personal care you would want should you lose the ability to make and communicate your own decisions.
Your AHCD can specify who will make and communicate decisions for you, and it can set out the circumstances under which you would not like your life to be prolonged if, for example, you were in a coma with no reasonable chance of recovery. The person that you choose as an agent should be someone who knows you well, understands your values, and would be able to make decisions that honor your wishes.
An AHCD is "springing," which means that it only comes into effect when incapacity occurs.
A document that goes hand-in-hand with your AHCD is an authorization to your medical providers to allow your agent access to your medical information. Without this authorization, your doctor could refuse to communicate with your specified agent.
Powers of Attorney
A power of attorney is a legal document giving another person (agent) the legal right (powers) to do certain things for you. They can be very limited, for example, allowing someone to represent you in a real estate transaction while you are out of town.
They can be long term or durable, ending only with your death. Typically, they empower your agent to take care of three types of decision-making:
Personal care; or
Health care. The Durable Power of Attorney for Health Care is now called an “Advance Health Care Directive.”
Durable Powers of Attorney should be frequently updated because banks and other financial institutions may hesitate to honor a power of attorney that is more than a year old. Any estate plan will usually incorporate these Durable Powers as part of the overarching planning for incapacity.