Document Preparation for Your Estate Plan

Document Preparation for Your Estate Plan

Determining what you want to include in your estate plan is just the first step in the estate planning process. You must document your desires and wishes in a formal estate plan to ensure that your wishes are carried out.

The documents you include in your estate plan speak for you when you are no longer able to speak for yourself. They tell the courts, your family members, your heirs, and other parties what you expect to happen after your death or incapacitation. Working with an experienced California estate planning attorney ensures that the documents in your estate plan convey your wishes in a legal format that will be recognized by judges, health care providers, attorneys, and any parties that might have an interest in your estate plan.

In this article, we cover:

  • The Estate Planning Document Everyone Needs
  • Assets That Pass Outside of Your Will
  • Using Trusts for Asset Protection and Special Situations
  • Incapacitation Planning Documents

The Estate Planning Document Everyone Needs

Everyone needs a Last Will and Testament (a “will”) if they do not have any other estate planning documents. A will can accomplish several estate planning goals. However, for most individuals, a will accomplishes four main objectives:

  • Names your heirs;
  • Distributes your property;
  • Names a personal representative; and,
  • Appoints and guardian and trustee for minor children.

In your will, you choose who inherits your property. If you do not have a will when you die, California’s intestate laws determine who receives your assets, which does not include charities and friends. Intestate laws also dictate the percentage of property distributed to each heir. Therefore, if you want to control the distribution of your assets after your death, you must have a valid will.

Your will also appoints a guardian to care for your minor children after your death. A testamentary trust, included in your will, appoints a trustee to manage your child’s inheritance until your child reaches an age that you specify in your will. Without a will, a probate judge decides what is best for your child, including who raises your child and manages your child’s money after your death.

Assets That Pass Outside of Your Will

Some assets pass outside of your estate; therefore, you must also be careful to review those assets as you are creating your estate plan. Beneficiary designations control who receives these assets, regardless of what your will states. While these assets are not part of your probate court for distribution purposes, they could count toward your estate’s taxable value. A California estate planning attorney can help you tailor your estate plan to account for these assets.

Examples of assets that pass directly to another individual through a beneficiary clause include:

  • Life insurance proceeds
  • Most retirement accounts (i.e., IRAs, 401k, 403b, pensions, etc.)
  • Some brokerage accounts
  • POD and TOD accounts (paid on death and transfer on death)
  • Some financial accounts

Property jointly held with another party may pass directly to that party upon your death. You and your attorney review the titles for each of your properties to identify properties that might pass outside of your estate versus properties that will be included in your estate. This review is critical in California as the state is a community property state for spouses, which can significantly impact an estate plan.

Using Trusts for Asset Protection and Special Situations

Other estate planning documents might be used for asset protection and to address unique situations. Trust agreements are the most common example of estate planning documents used for asset protection and special circumstances.

Certain trust agreements offer a substantial degree of asset protection from creditors, family members, and other parties. An irrevocable trust can protect the trust assets from the settlor’s (the person who created the trust) creditors. It can also protect the assets from the creditors and family members of the beneficiary (the person receiving benefits from the trust).

An irrevocable trust avoids probate and reduces the estate’s taxable value. High-net-worth individuals often use one or more trusts to reduce or avoid estate taxes while shielding their property from their creditors and other parties in interest.

Other trust agreements address specific issues. For example, if you have a family member with special needs, you may want to create a Special Needs Trust to provide for your loved one while maintaining his or her eligibility for government benefits. A Pet Trust can provide funds to care for a pet after your death. Charitable trusts provide income and benefits for one or more charities during and after your lifetime.

A Generation Skipping Trust can be used to create a legacy for your grandchildren and future generations. There are also special trusts for holding title to life insurance policies, retirement accounts, real estate, and family businesses. An estate planning lawyer can help you choose the trust that meets your needs and gives you and your family the best benefits of estate planning.

Incapacitation Planning Documents

Estate planning includes planning for your incapacitation. An illness or accident could prevent you from making financial and medical decisions for yourself. There are several estate planning documents you can use to ensure that your voice is heard when you cannot speak for yourself.

  • Powers of Attorney — Financial powers of attorney appoint an agent to manage your finances and property if you are unable to do so for any reason. Medical powers of attorney appoint an agent to make health care decisions for you.
  • Living Wills and Medical Directives — These documents may be used to direct health care professionals regarding your preferences for end-of-life care and treatment. For instance, you can dictate that you do not want to have a feeding tube inserted or to be placed on a ventilator if your condition is terminal.
  • HIPAA Authorizations — Signing a HIPAA authorization allows your named representatives access to your medical records and health care information.

By executing certain estate planning documents, you can avoid the need for court intervention into your personal affairs, such as the appointment of a guardian or conservator.

A California estate planning attorney can discuss with you the various tools and documents you can use to ensure your wishes are honored when you cannot voice your wishes yourself.


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