| General Questions about Estate Planning: |
| Q: |
What is an Estate? Do I have one? |
| A: |
Yes, you have an Estate. Your Estate is basically the property you own. |
| Q: |
What is Estate Planning? |
| A: |
Estate Planning is the act of determining what happens to your Estate after you're gone. An Estate Plan can be a simple two page Will or an intricate web of multiple Trusts. |
| Q: |
Who should have an Estate Plan, Will or Trust? |
| A: |
Everyone! There is an unfortunate, widespread misconception that only the wealthy need an Estate Plan. In fact, an Estate Plan is for anyone who wishes to provide for their survivors. If you pass away without a Will or other Estate Plan, the laws of the state take over, and these laws may not reflect your wishes or provide for the ones you love. |
| Q: |
What is a Will? |
| A: |
A Will is a legal document that states who receives your property when you die. |
| Q: |
What is a Trust? |
| A: |
A Trust is an arrangement under which one person (the donor) transfers legal ownership of assets to another person or corporation (the trustee) to be used for the benefit of one or more other people (the beneficiaries).
A Trust can either be created in the donor's lifetime (an inter vivos trust) or by the donor's will (a testamentary trust). Those established during a donor's lifetime can be either revocable or irrevocable. In the case of a revocable trust, the donor retains control by reserving the right to revoke the trust. An irrevocable trust constitutes a complete surrender of property and the donor no longer retains any control over the assets.
While your Will directs how your assets will be distributed, a Trust can be established to protect assets from substantial taxes and achieve other financial goals.
Trusts can be used to transfer valuable assets outside your estate, while maintaining control over how the property is managed and distributed long after you're gone. Trusts can also provide life insurance for your children without adding to the taxable estate at the time of death.
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| Q: |
When should you change your Estate Plan? |
| A: |
After a divorce or marriage. After the birth of children or grandchildren. After a change in financial circumstances. After a change in the code, such as the 1997 Taxpayer Relief Act which changed over 800 sections of code. After a move into a different state. |
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