Debra Law, A Professional Corporation
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Why Do I Need An Estate Plan?
Creating an estate plan does more than just dictate who gets your heirlooms. When you create a comprehensive estate plan, you secure your assets from creditors, avoid probate, and maintain peace of mind knowing that your wishes will be legally binding and carried out by your loved ones. There are many benefits of creating a comprehensive estate plan, and Debra Law is here for you every step of the way.
1
AVOID PROBATE
Probate is the expensive, long, tedious process, where the court administers your assets based on blood relation; step-children are NOT entitled to probate proceeds. Through probate, any lineal descendants of yours are contacted, and each get their own slice of the pie. This means that even if you spent your entire life avoiding a certain person, if they are next in line of your living descendants, they are legally entitled to their share of your assets. Not only that, the attorney and representative are both owed fees, and creditors get paid before any beneficiaries. If you have no living relatives at the time of probate, your entire property will go to the state. It is much cheaper and more efficient to set up an estate plan than to force your loved ones to endure the probate process.
2
MINIMIZE TAXES FOR YOUR HEIRS
When you create an estate plan, any real property will be inherited by the heirs of your choosing at your death. The chosen heirs will also inherit a "stepped-up" basis in that property. A stepped-up basis means that any heirs who inherit real property will avoid capital gains tax because the property's basis will be considered the fair market value at the date of death. This means that when an heir chooses to sell the property, no capital gains will occur, so the tax is avoided. When a property is sold through probate, it is extremely likely that capital gains tax will be owed, and the sale will trigger a property tax reassessment.
3
CREDITORS
As discussed above, if probate is triggered, creditors are notified and are legally entitled to be reimbursed for any debts you have incurred over your life. Creating an estate plan transfers your assets from you directly to your trust, shielding your assets from creditors. If this is your main concern, Debra Law will work with you to create the proper trust structure.
4
PEACE OF MIND
A comprehensive estate plan allows you to feel at ease knowing that everything will be taken care of according to your wishes when the time comes. This includes details down to how you want your finances managed, and who you want to care for you if you become incapacitated. If you have young children, estate planning allows you to choose your child's guardian, as well as take care of all expenses related to your child's well-being.