Palm Springs Estate Planning

As you plan your estate, you will need to consider the following:

• How your assets will be managed for your benefit if you are unable to do so
• When certain assets will be transferred to others, either during your lifetime, at your death, or sometime after your death
• To whom those assets will pass

Estate planning also addresses your welfare and needs, planning for your own personal and health care if you are no longer able to care for yourself. Like many people, you may at first think that estate planning is simply the writing of a will. But it encompasses much more. As you will see, estate planning may involve financial, tax, medical and business planning. A will is one part of that planning process, but other documents are needed to fully address your estate planning needs. Also note, just as people, assets and laws change. It may well be necessary to adjust your estate plan every so often to reflect those changes.

When considering your estate plan, you should ask yourself the following questions:

1. What are my assets and what is their approximate value?
2. Whom do I want to receive those assets - and when?
3. Who should manage those assets if I cannot, either during my lifetime or after my death?
4. Who should have the responsibility for the care of my minor children if I become incapacitated or die?
5. If I cannot take care of myself, who should make decisions on my behalf concerning my care and welfare?

Whatever the size of your estate, you should designate a person who, in the event of your incapacity, will have the responsibility for the management of your assets and your care, including the authority to make health care decisions on your behalf. If your estate is small in value, you may focus simply upon who is to receive your assets after your death and who should be in charge of its management and distribution. If your estate is larger, your lawyer will discuss with you not only who is to receive your assets and when, but also various ways to preserve your assets for your beneficiaries and to reduce or postpone the amount of estate tax which otherwise might be payable upon your death.

If one does no planning, then California law provides for the court appointment of persons to take responsibility for your personal care and assets. California also provides for the distribution of assets in your name to your heirs pursuant to a set of rules to be followed if you die without a will; this is known as "intestate succession." Contrary to popular myth, if you die without a will, everything does not automatically go to the state. Your relatives, no matter how remote, and in some cases the relatives of your spouse, will have priority in inheritance ahead of the state. Nonetheless, they may not be the people you would want to inherit from you; therefore, a will is the preferable approach.

It's certainly a good idea to have a qualified estate planning attorney assist you in articulating, designing and implementing your estate plan. If nothing else, you should at least consult with an attorney at some point, even if only to review your plan and the documents you may have prepared yourself or purchased over the internet. Estate planning is often full of complicated issues requiring an expert's knowledge of probate laws, property laws, inheritance laws and federal estate tax laws. Too often, these issues are never addressed until after the fact when all the complications arise. At that point, it is almost always too late. The better practice, by far, is to have a qualified estate planning attorney or other professional review everything for you.

A Will is used to transfer property held in your name to the individuals or organizations you would like to receive it. A will names someone whom you have selected to be your Personal Representative (or Executor). This person will carry out your instructions upon your death. A will becomes effective upon your death and after it is admitted to probate (the court process for administering a will.)

A Durable Power of Attorney for Health Care selects a person you choose to make decisions regarding your health care treatment in the event that you are unable to do so yourself.

A Living Will or Advance Directive gives doctors and hospitals your instructions regarding the nature and extent of the care you want should you suffer a permanent incapacity.

A Durable Power of Attorney for Property selects a person of your choice to act or handle your financial matters should you be unable or even unavailable to do so.

A Revocable Living Trust is used to hold title and manage your property. You can select the person you want, even yourself as the trustee to carry out the instructions in the Trust. Unlike a will, a trust becomes effective immediately and continues during your lifetime even in the event of your incapacity and continues after your death. Many trusts are revocable - meaning you can make future changes and even terminate them. Trusts also help minimize the expenses, delays and publicity of probate.

A living trust is also a good tool for preparing for disability. In a living trust you can name a successor or co-trustee who can manage the property for your benefit if you become incapacitated.

An Irrevocable Life Insurance Trust is a device used to move a life insurance policy out of the insured persons taxable estate. An existing policy can be transferred to a trust or the trust may purchase a new policy. Removing the policy from one's taxable estate can save a significant amount of estate taxes for individuals with large estates.

Specials Needs Trusts are used to hold the assets of a disabled person. A proper special needs trust would provide distributions as needed to enhance the life of a disabled person while protecting the assets in the trust from being viewed as assets which disqualify the person for state and federal benefits.

Charitable Remainder Trusts are created to pay income from the trust to the Grantor (or any other designated beneficiary) and distribute the remainder of the assets to a charity. By designating assets to charity the Grantor receives a tax deduction and removes those assets from his/her taxable estate.