For current Estate and Gift tax figures, click here.
At Frank & Kraft, Attorneys at Law, we often receive questions from our friends and neighbors throughout Indiana about the various aspects of estate planning. That’s not surprising, since this important area of the law can often be a source of confusion for those unfamiliar with things like probate, wills, and trusts. We feel that it’s helpful from time to time to look at some of those questions and try to provide answers. Often, those answers can serve to shed even more light on the important role that effective estate planning can play in all our lives.
- Why do I need to worry about estate planning?
- Shouldn’t I have more money before I start to plan?
- Will my Last Will and Testament keep my property out of probate?
- Isn’t a DIY form will good enough?
- Why would I ever want a trust?
- What is Medicaid planning?
- I’m not sick. Why would I need an incapacity plan?
- I’m not a millionaire. Why should I worry about the estate tax?
- Do I have to figure this out on my own?
The answer is that you don’t need to worry about it if you don’t want to do so. After all, more than half the country has no will. You’d be in good company if you just forgot about estate planning altogether and let the courts sort it out when you die. Of course, that wouldn’t help your loved ones or ensure that your asset went to the people you truly care about. And it could result in a good portion of your wealth being consumed by court and attorney fees. If you want to avoid all those negative consequences, then you should want to create an estate plan.
How much money were you thinking you’d need? Most of us never seem to think that we have all the money we need, so how would you know when you have enough to create the plan you’re thinking you might need? No, the time to start planning is now. Besides, sound estate planning is one of the best ways to help ensure that you reach those lofty financial goals.
The long answer is “no.” That’s also the short answer. While a will can do many things, it cannot help you avoid probate, since wills typically get settled through the probate process. There are some exceptions, like when the estate is really small. As a rule, however, wills need probate like fish need water.
That’s a common question these days – and with good reason. It seems like we turn to the internet for solutions to all our problems. With a do-it-yourself will, however, you are just as likely to download even more problems than you have now. The fact is that there’s no way of knowing who prepared most of those forms, and there’s no guarantee that they can help you create the plan you need. Our recommendation: rely on professionals who stand by their work.
Trusts are not always something that everyone wants, but they can provide a whole host of benefits for the people who use them. In addition to helping your estate escape the probate process, a trust can also provide an effective way for you to leave money to disabled heirs whose inheritance might otherwise disrupt their ability to receive government benefits. Your trust can be used to care for pets, provide long-term care for minor children, or even protect an inheritance from a spendthrift heir. There are trusts to help mitigate the estate tax, trusts to shelter assets, and trusts to help you qualify for Medicaid to pay for nursing home care.
Medicaid planning incorporates all those strategies you might need to help ensure that you can receive the benefit you need in the event that you ever need to find a way to pay for expensive nursing home costs. Long-term facility expenses are rising with each passing year, and few seniors can afford to pay those costs on their own. The problem is that many of them find themselves in a position where they have just enough assets to be denied Medicaid, but not enough to actually pay for their own care. Medicaid planning can help you to better manage your assets over time to ensure that you have the eligibility you need when that time comes.
Many people ask this question as well. It’s only natural to think that we’re all but invincible – assuming that bad things only happen to other people. The reality is that any of us can be stricken with an incapacitating injury or illness at any time, and all of us eventually need to face the rigors of old age. When that happens, we need to be prepared with powers of attorney that provide a designated agent to manage financial and health care decisions, a living will to express our treatment desires, and HIPAA releases so that our agent or agents can access the private health information they need to make sound decisions.
You may not have to worry about that tax, but it never hurts to be prepared for good fortune. The Federal estate tax may only apply to estates valued at more than $5.49 million, but that doesn’t mean that your estate won’t eventually get to that level. If you own a business, valuable properties, or high-value life insurance policies, your estate could eventually be worth far more than you anticipate. In any event, many solutions for estate tax mitigation involve the type of asset protection strategies that can provide you with other benefits even if the estate tax never comes due.
Perish the thought! At Frank & Kraft, Attorneys at Law, our estate planning experts are always here to help you navigate through all these complex issues and more. We’re proud to provide state of the art estate planning and elder law services to our clients in the area, and look forward to answering your unique questions too. If you have questions about estate planning or are ready to start preparing your legacy plan today, call (317) 684-1100, or contact us at our website.