One day William’s daughter read in an article that a will was not the best way to leave property to heirs. Wills often involve long and expensive court proceedings and there are other, more efficient ways to pass on savings to family. But William was a person who knew his own mind, and he felt sure that a simple will would be good enough for him.
A will without court approval is nothing more than the paper it’s written on. Wills, by themselves, are not enough to prevent property from staying “stuck” in a decedent’s name. The only way a will could be effective, to give William’s daughter the inheritance he wanted her to have, was for his daughter to go to court after he passed. Courts make sure that wills are valid, debts are paid, and – despite whatever the will may say – whether other family members might also have a legal right to a portion of the estate. Worse, because probate court files are public record, anybody off the street could have open access to all documents filed there, including wills.
So when William’s daughter filed in probate court after he died, she soon found herself besieged by get-rich-quick con artists. William’s estranged second wife’s children showed up to demand a piece of his estate. When a small loan William owed on his house was discovered, a property broker flagged the house for foreclosure and the daughter’s lawyer had to move fast to keep the house off the auction block.
It took over three years to resolve these complications. Even simple probate matters can end up costing between two and eight percent of the total estate value. William’s daughter had to pay around $30,000.00 in court costs, attorneys’ fees, and accounting expenses. She then had a minor traffic accident. Even though nobody was hurt, the other driver sued her and she eventually spent a significant chunk of the rest of her inheritance on attorneys’ fees and court charges.
If only William had heeded his daughter’s advice, these difficulties could have been avoided or minimized. Here is what an experienced Marietta estate planning attorney could have recommended instead.
Making his bank account “POD.” William kept a modest sum in a savings account. He could have left that money to his daughter using a “payable on death” (POD) designation, simply naming his daughter as owner of his account on his passing. Then all his daughter would have to do would be to present William’s death certificate and proper identification, and the bank would pay over the funds to her. No fees, no fuss, no exposure.
Deeding his house. There are several inexpensive and effective options to use deeds to transfer ownership of real estate automatically, without the need for probate. An attorney would know which kind of deed would have suited William best.
Protecting the inheritance. William had several antique cars worth around $50,000.00. An attorney could have created a trust for William, transferred ownership of the cars into the trust, and named his daughter as trustee. As long as the trust was carefully drafted, the money those cars could fetch might have been protected from the accident litigation.
Small-estate proceedings. William’s estate was too large to benefit, but, for smaller holdings, most if not all states permit shortened and simplified proceedings that avoid the costs and delay of full-blown probate proceedings. These go by various names, including “small-estate” or “voluntary-administration,” or “summary-administration” proceedings. As long as an estate is worth less than the upper limit set by law, property can be distributed without the court supervision that probate proceedings otherwise require. The limit varies depending on the state, generally between $30,000.00 and $100,000.00. In Georgia, accounts with less than $10,000 can be transferred by affidavit and without probate and so can automobiles.
When it comes to wills, there are many better alternatives that would have kept William’s financial affairs more-efficiently managed and private. Attorneys know. Please ask. Call our Marietta estate planning lawyers at 770-425-6060 and let us educate you so you can make the decision of what planning tools are best for you and your family.
Stephen M. Worrall, Marietta Estate Planning, Elder Law and Probate Attorney at Georgia Estate Plan: Worrall Law LLC, has been selected to the 2018 Georgia Super Lawyers list. He was named as a Top Estate Planning and Probate Lawyer, one of only 34 named in that practice area in Georgia this year. No more than five percent of the lawyers in the state are selected by Super Lawyers.
Super Lawyers, part of Thomson Reuters, is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. The annual selections are made using a patented multiphase process that includes a statewide survey of lawyers, an independent research evaluation of candidates and peer reviews by practice area. The result is a credible, comprehensive and diverse listing of exceptional attorneys.
The Super Lawyers lists are published nationwide in Super Lawyers Magazines and in leading city and regional magazines and newspapers across the country.In Georgia, the results are posted in Atlanta Magazine. Super Lawyers Magazines also feature editorial profiles of attorneys who embody excellence in their practice of law. For more information about Super Lawyers, go to SuperLawyers.com. To see Mr. Worrall’s listing, go here.
Blended families are becoming more and more common in modern society, yet, estate laws remain largely unchanged and still geared toward a “traditional” family structure. This poses an issue for a Marietta estate attorney when it comes to leaving an inheritance for step-children in an estate plan. Step-children are often not legally adopted by the new spouse, which means they are not considered as “heirs” for inheritance purposes. However, a solid estate plan can help you work around laws of Georgia to ensure your step-children are not left out.
The easiest way to leave assets to step-children is to name them in a will or trust. Assets can be left in the form of a percentage of the estate, or by specific assets. If there are other children involved, it is important to avoid confusion by naming each child and step-child using their individual names, rather than terms such as “descendants,” “heirs,” or even “children.”
There are also a number of estate planning tools that can be used to include step-children in an inheritance. If the objective is to avoid probate, a revocable living trust can be established in which a step-child is named as a beneficiary. If a step-child is disabled, it may be necessary to establish a special needs trust to maintain their eligibility for government programs. Lastly, a step-child can also be named as a beneficiary of a life insurance policy or a Pay-On-Death financial account.
While there is no legal obligation to leave step-children an inheritance, it may be the best choice when there’s a close relationship or the step-parent played a significant role in raising the child. Obviously, leaving money to step-children means the amount of assets available to other biological children will be reduced. If you expect that this will cause conflict, it would be helpful to explain these decisions to all family members in advance. By engaging in an open and honest dialogue, you can minimize the potential for family squabbles and the possibility of a will contest. During the conversation you could clarify why you included each beneficiary (including step-children), why you selected the person who will serve as your executor, and your thoughts about the family.
If you want to make sure that your step-children will receive the assets you choose to leave them, you should speak with an experienced Cobb County estate planning lawyer. To schedule a consultation at our Marietta estate planning law firm, simply call the office at 770-425-6060.
Millions of individuals are affected by dementia in their lifetime. Unfortunately, it is usually after a medical crisis like dementia hits that many families begin to think about estate planning, and talking to their Marietta Estate and Elder Lawyer.
What people don’t realize, however, is that it may be “too late” under the law to make a plan after dementia strikes. This is usually the case when dementia is in an advanced state. In order for legal documents to be valid in Georgia, the person signing them must have “testamentary capacity.” This means that he or she must fully understand the implications of what is being signed.
Does that mean that your loved one can no longer sign legal documents after a diagnosis of dementia? Not necessarily. Dementia is a progressive condition, and mental capacity can be fluid in earlier stages. Your loved one may still be considered mentally competent to sign legal documents, even with a diagnosis of dementia if he or she:
- Can understand the nature and extent of their property
- Can remember their relatives and descendants
- Is able to articulate who should inherit their property
- Can understand what they are signing
- Can understand how all these things relate and come together to form a plan
In some instances, a verification from a physician about the individual’s competence may be required and the ability of whether a person with dementia can sign legal documents will rest in the doctor’s hands.
If the physician determines that your loved one cannot execute legal documents, the family must then turn to the court system, and likely the process of Guardianship and/or Conservatorship, in order to take over control of the senior’s affairs in the absence of a current Trust, Power of Attorney, or Health Care Directive.
Whether your loved one can sign legal documents following a diagnosis of dementia really depends on his or her individual battle with the disease. Talk to a Marietta estate and elder lawyer, as well as your loved one’s doctor for an idea of what your options may be. Be sure to go through all the proper channels as your loved one’s legal documents could be contested later on if you have them quickly signed while there is still a question of mental capacity out there.
If you need assistance getting started and evaluating your loved one’s situation, we invite you to contact our Marietta GA estate and elder law attorneys at 770-425-6060 to schedule a consultation.
Happy New Year 2018! Resolving to get your legal affairs in order is one of the most important things you can do to make sure your family, wishes, and assets are protected if something unexpectedly happens to you this year.
While many people focus on getting out of debt or getting organized for the New Year, estate planning is an equally important personal finance goal that should make every adult’s to-do list.
That’s because far too many area residents are without plans to protect their family, wishes and assets should something unexpectedly happen to them. A recent Lawyers.com survey further reveals that only 35% of adults have a basic will or other estate planning documents in place should death or incapacity occur.
Contrary to popular belief, estate planning isn’t just for the rich. At a bare minimum, every adult needs a basic will, power of attorney and health care directives in place to avoid a legal and financial nightmare if something unexpectedly happens to them.
So what are these documents and how do they help you in a time of emergency?
- Will – A will is a document that specifies what should happen to your assets if you pass away. A will may also contain guardian nominations to dictate who will care for your minor children if something unexpectedly happens to you.
- Trust – A trust is a legal entity that can hold title to property. With your assets securely placed in a trust, you can minimize your financial exposure to lawsuits, divorce, and bankruptcy while alive. Upon death, a trust will keep your affairs private and out of the probate court. It also allows a great deal of control for people who do not want their inheritance going outright to their heirs if something unexpected happens.
- Power of Attorney – A power of attorney or POA gives explicit permission for someone to access your personal accounts, pay your bills and handle all other financial and legal affairs if you are incapacitated in an accident but do not die. Under the current privacy laws, even a spouse may have a hard time accessing personal information without such documentation in place.
- Advanced Health Care Directive – Also known as a living will, this document specifies your healthcare wishes if you are incapacitated in an accident and unable to speak for yourself. Such wishes may range from whether you want certain medications administered to when (if at all) to start life support in critical situations. This document also allows you to appoint the person best suited to carry out such wishes should incapacity occur.
Accidents and serious illness happen every day without warning. That’s why it’s so important for any adult who has not tackled their estate planning to add it to their resolutions this year. It will save your family from years of headaches and thousands of dollars in unexpected costs should the unthinkable happen.
Make this your New Year’s resolution this month: “I will get my estate plan in place or updated.” Call me, Steve Worrall, your Marietta estate planning lawyer, at 770-425-6060 or email me at steve @ georgiaestateplan.com and let’s get your family protected and give you peace of mind for 2018 and beyond.
Unfortunately, family feuds that center around someone’s will or trust are a tale as old as time. Even if this is not something you have personally experienced, you may have heard a few horror stories. While family squabbles after the death of a loved one are not always avoidable, there are a few strategies that can be utilized to decrease the possibility:
- If you have dependents, plan for the “what if.”
Many people in their early 20s and 30s do not spend much time thinking about an estate plan. However, if you have minor children, it is critical to choose who will care for them if you pass away or become incapacitated. Once you decide, discuss your wishes with all parties involved. For example, if you are leaving your children to one set of grandparents, it is a good idea to explain that decision to the other grandparents. This can ease a lot of hurt feelings and potentially avoid a court battle if that time should ever come.
- When you come up with a plan, make it legal!
We’ve seen this sad situation quite a bit; there was a plan and it was discussed, but never legally documented. After talking to your loved ones about your plan, you need to make it legal. That way there are no questions or arguments after you pass away.
- Unequal distributions of assets can cause the biggest heartache.
Many people choose to leave their assets to their children in equal shares. In this scenario, things tend to go smoothly. But, there are many reasons why you may avoid dividing your assets in this way. For example, you may have a child with special needs that requires more money to maintain his or her level of care. If you choose to leave unequal shares, give an explanation to everyone involved so they know the reasons. This could help save your children’s relationships with one another.
- Choose your Executor or Trustee with care.
Your loved ones may be hurt by the fact that they were not trusted to serve as the Executor or Trustee of your estate. This may cause a conflict between the person chosen and the other beneficiaries. Make sure that you choose your executor or trustee with care, and explain your decisions. It may even be best to choose a neutral third-party to serve in this role if you believe it will cause problems after you are gone.
When it comes to inheritance conflict, we’ve seen just about everything. That experience helps us guide you through the “tricky” situations that may cause your family to squabble after you are gone. Call our Marietta wills lawyer at 770-425-6060 and let’s get started on your estate plan to avoid any potential conflict.