A Significant Percentage of Americans i Understand Estate Planning Which Is the Reason Why Most People Are Going Through

Life Without A Comprehensive Estate Plan

ESTATE PLANNING

DEMYSTIFIED

DENNIS D. DUFFY Iowa Estate Planning Attorney

A significant percentage of Americans know very little about estate planning. This is one of the reasons why most people are going through life without a comprehensive estate plan. Death is inevitable for all of us. Though it may not be the most pleasant subject to contemplate, all responsible adults should have an estate plan in place. This type of planning is not done for your own benefit. It is done for the benefit of those that you love. This should be motivation enough to put an estate plan in place. In this paper we will demystify estate planning as we provide you with some necessary information.

TRANSFERRING FINANCIAL ASSETS: THE LAST WILL

When you are planning your estate one of the top priorities will be the transfer of financial assets. There are a variety of different ways that you can approach this task. Everyone is aware of the existence of a legal device called a last will or last will and testament. You can use a last will to state your final wishes regarding the distribution of your property.

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If you use a last will and you should include the nomination of an executor or personal representative. This is the individual who will conduct the business of the estate after you pass away. You could also include the nomination of a legal guardian who would care for your minor children should both parents pass away. Many people do not use a last will to arrange for future asset transfers. When you state your final wishes in a last will the estate must be probated. Probate is a legal process that takes place under the supervision of the probate court. There are considerable expenses that can pile up during the probate process. It is a public proceeding that strips your family of privacy. And, it is timeconsuming. The heirs to the estate do not receive their inheritances until the estate has been probated and closed. This can take months in routine cases, and an estate can be stalled in probate for years under complex circumstances.

PROBATE AVOIDANCE
You can arrange for the transfer of financial assets after you pass away free of the probate process. One way to do this would be to open payable on death accounts. These accounts are offered by banks and brokerages. You name a beneficiary, and this beneficiary would assume ownership of the assets in the account after you pass away. There is also joint tenancy with right of survivorship. Property held in this manner would be transferred to the joint tenant after your passing outside of

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probate. While these options are available to you, they are not highly recommended by estate planning attorneys. A more reliable way to facilitate probate avoidance would be to convey assets into a revocable living trust. Revocable living trusts enable you to retain control of the assets that you have conveyed into the trust while you are living. When you create the trust agreement you elucidate terms, and you name a beneficiary or beneficiaries. After you pass away the trustee distributes assets to the beneficiaries in accordance with your wishes. These distributions take place in a timely manner outside of the process of probate.

ADVANCED ESTATE PLANNING

There are various different advanced estate planning strategies that can be implemented when certain circumstances exist. The federal estate tax is a factor for people who are in possession of assets that exceed $5.25 million. It is possible to position these assets in a tax efficient manner. Asset protection can be a concern for many individuals as well. You can protect assets through the use of certain legal devices such as limited liability companies, asset protection trusts, and family limited partnerships. People who have disabilities often rely on government benefits. Programs like Medicaid and Supplemental Security Income are need-based programs. A direct inheritance could disqualify a person with special needs from eligibility.

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This type of situation is properly addressed through the utilization of a supplemental or special needs trust. There is also the matter of providing for a spendthrift heir. It is possible to make a poor money manager the beneficiary of a spendthrift trust. This would prevent the spendthrift from burning through his or her inheritance too quickly.

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INCAPACITY PLANNING
A well constructed estate plan will address the period of time that will precede your passing. It is possible that you will become incapacitated late in your life. At this point you may be unable to make your own decisions. You can name agents to make decisions in your behalf by executing documents called durable powers of attorney. A living will is also recommended. With this document you state your wishes regarding the use of artificial life-support measures if you were to fall into a terminal condition.

Living Trusts: Plan Ahead for Your Family's Future Creating Trusts and Living Trusts Put Your Family First A Living Trust is a very versatile estate planning tool - one that can be customized to suit all your needs.
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CONCLUSION
Estate planning is essential for all responsible adults. You should arrange for the transfer of your financial assets and prepare for the possibility of incapacity during your twilight years. The best way to proceed would be to retain the services of a licensed estate planning attorney. Your lawyer will gain an understanding of your wishes, evaluate your unique personal situation, and make the appropriate recommendations.

REFERENCES
Forbes http://www.forbes.com/sites/janetnovack/2012/10/14/the-forbes-guide-toestate-planning/ American Bar Association http://www.americanbar.org/groups/real_property_trust_estate/resources/estat e_planning.html

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About the Author

Dennis D Duffy
Dennis Duffy combines an extensive background in business with a wide range of legal experience to provide his clients with a uniquely practical perspective. An attorney since 1989, he practices primarily in Estate Planning, Wills, Trusts and Probate. Mr. Duffy also offers frequent educational seminars on a variety of estate planning topics to both the general public and private groups in the Quad Cities area. Experience Mr. Duffy has been practicing law since 1989, when he joined the general practice firm of Bozeman, Neighbour, Patton & Noe in Moline Illinois. In 1990, Mr. Duffy and five other attorneys founded the law firm of Anderson & Nelson, with offices in Rock Island, Illinois and Davenport Iowa; the firm eventually grew to 12 attorneys, with Mr. Duffy as managing partner. He founded Duffy Law Office in 1995. Before returning to school for his advanced law and business degrees, Mr. Duffy worked for nearly a decade for Per Mar Security & Research Corp. in Davenport, as Vice President. Mr. Duffy is a member of the American and state bar associations of both Iowa and Illinois as well as the Scott and Rock Island County Bar Associations. He is an executive member of the American Academy of Estate Planning Attorneys. He is coauthor of the book Estate Planning Basics A Crash Course in Safeguarding Your Legacy. Also, the American Academy of Estate Planning Attorneys announced that Mr. Duffy was honored with the Academy Fellow designation. The Fellow program recognizes Academy Members who demonstrate advanced expertise and significant practical experience in the estate planning, trust, tax planning, guardianship, probate and estate administration fields.

Duffy Law Office

Helping Families Preserve their Wealth www.duffylawoffice.com 1840 E. 54th Street Davenport, IA 52807 (563) 445-7400

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