Whether or not you currently have estate planning documents, one important item to add to your calendar is getting an estate plan checkup.
Don’t Have an Estate Plan?
If you don’t already have an estate plan, then getting one in place should be at the top of your to-do list.
Why? Because without an estate plan, you and your property may end up in a court-supervised guardianship if you become incapacitated, and your property and your loved ones may end up in a time-consuming and expensive probate proceedings after you die. Josh Bryant is often asked if a simple will is enough, and while he appreciates the desire to cut costs the possibility of a guardianship or probate is reason enough to have a trust in the vast majority of scenarios.
Worse yet, if you don’t take the time to have any estate planning done, then the state where you live at the time of your death will essentially write one for you. It most likely won’t divvy up your property the way you would have and certainly will not protect your heirs the way you would.
A common misconception is that estate planning is only necessary for wealthy people. But this simply isn’t true – anyone with a bank or retirement account, a home, or a family needs to make a plan for what happens if they become incapacitated or when they die. Of course, the complexity of the plan will vary depending on your circumstances, but all estate plans should be put together with the help of an attorney like Josh Bryant who is experienced with the legal formalities required to create a valid will, trust, health care directive, and power of attorney in Arkansas.
How Old Is Your Estate Plan?
Do you already have an estate plan? If you do, then please pull your documents out of the drawer, dust them off, and look at the date you signed them.
Were your documents signed in the 80s or 90s, or, worse yet, before 1980? If so, please run, don’t walk, to the phone and call estate planning attorney Josh Bryant. Your documents are terribly out of date and need to be updated as soon as possible.
Did you sign your documents between 2000 and 2009? Aside from the federal estate tax exemption jumping from $675,000 to $3,500,000 during that time period, state estate taxes disappeared in many states. Because of the significant changes in federal and state estate taxes, documents from this time period may be out of date and need to be tweaked in some shape or form.
Did you sign your documents between 2010 and 2017? Federal estate taxes, gift taxes, and generation-skipping transfer taxes went through major changes during these years, and “portability” of the federal estate tax exemption between married couples was introduced. Unfortunately, while your estate planning documents may only be a few years old, they very likely do not take advantage of the opportunities made available from recent changes in federal tax laws.
And, it’s not just tax laws that are changing – modifications to state laws governing wills, trusts, health care directives, and powers of attorney may warrant some revisions to your estate planning documents as well. Just this session, the Arkansas General Assembly passed several acts affecting how trusts are treated in Arkansas.
And last but not least, regardless of what year you signed your estate planning documents, think about all of the changes in your life since you signed them. Did you get married or divorced, have a child or two or a grandchild or two, or move to a new state? Did you sell your business, retire, have a significant change in assets, or win the lottery? Any major changes in your family or financial situation will certainly have an affect on your estate plan.
Estate Planning Is Not a One Shot Deal
Estate planning is not a static event that you can grudgingly do once and then forget about it. On the contrary, estate planning is a continuing process, because life is a moving target that is full of constant change: Your estate plan needs to change as your life changes.
Josh Bryant is here to help you navigate the changes that have occurred since you had your estate plan prepared and ensure your wishes are still being carried out as you envisioned. For those needing an estate plan, Josh Bryant is here now and in the future to mold your estate plan as you move through the various stages of life.
Josh Bryant, Managing Attorney
Confused about the differences between wills and trusts? If so, you’re not alone. While it’s always wise to contact experts like attorney Josh Bryant, it’s also important to understand the basics. Here’s a quick and simple reference guide:
What Revocable Living Trusts Can Do That Wills Can’t
1. Avoid a guardianship.
A living trust allows you to authorize your spouse, child, or other trusted person to manage your assets should you become incapacitated and unable to manage your own affairs. Wills only become effective when you die, so they are useless in avoiding guardianship proceedings during your life. This provides a lot of security for many.
2. Bypass probate.
Property in a revocable living trust does not pass through probate. Property that passes using a will guarantees probate. The probate process, designed to wrap up a person’s affairs after satisfying outstanding debts, is public and can be costly and time consuming sometimes taking years to resolve. Josh Bryant believes this is probably one of the top two key benefits of a trust. Trusts are more effective and efficient in accomplishing your goals.
3. Maintain privacy after death.
Wills are public documents; trusts are not. Anyone, including nosey neighbors, predators, and unscrupulous “charities” can discover the details of your estate if you have a will. Trusts allow you to maintain your family’s privacy after death.
4. Protect you from court challenges.
Although court challenges to wills and trusts occur, attacking a trust is generally much harder than attacking a will because trust provisions are not made public. Court challenges make your estate distribution an inefficient process. A trust can provide you with security from this possibility.
5. Allow for structured payouts.
Under a will, once an heir turns eighteen, they automatically get everything under the will unless you have some sort of trust which requires a payout over time. Young parents and grandparents who may leave property to their grandchildren can use a trust to ensure that assets are paid out over time rather than given in lump sum to someone who may not be mature enough to handle it. Josh Bryant believes this is one of the two best reasons to have a trust.
What Wills Can Do That Revocable Living Trusts Can’t
1. Name guardians for children.
Only a will - not a living trust or any other type of document - can be used to name guardians to care for minor children. The courts are not required to follow your wishes if the judge believes that it would be in your children's best interest to be in the custody of another person, but most of the time the judge will follow your wishes. The security of knowing your children will be protected is in and of itself enough of a reason to get a will.
2. Specify an executor or personal representative.
Wills allow you to name an executor or personal representative - someone who will take responsibility to wrap up your estate after you die. This typically involves working with the probate court, protecting assets, paying your debts, and distributing what remains to beneficiaries. But, if there are no assets in your probate estate (because you have a fully funded revocable trust), this feature is not necessarily useful.
What Both Wills & Trusts Can Do:
1. Allow revisions to your document.
Both wills and trusts can be revised whenever your intentions or circumstances change so long as you have the legal capacity to execute them.
WARNING: There is such as a thing as irrevocable trusts, which can only be changed under certain circumstances, using very specific methods. These are powerful estate planning tools in certain circumstances, but should be entered into with care and the assistance of Josh Bryant.
2. Name beneficiaries.
Both wills and trusts are vehicles which allow you to name beneficiaries for your assets.
3. Provide asset protection.
Trusts, and less commonly, wills, can be crafted to include protective sub-trusts which allow your beneficiaries access but keep the assets from being seized by their creditors such as divorcing spouses, car accident litigants, bankruptcy
trustees, and business failure. This is just another level of security that estate planning can provide.
While some of the differences between wills and trusts are subtle; others are not. Together, we’ll take a look at your goals as well as your financial and family situation and design an estate plan tailored to your needs that leverages the law in your and your family's favor and secures your assets in an effective and efficient manner. Schedule an appointment and let’s get started.
Josh Bryant is an attorney, entrepreneur, pastor, and visionary with a heart to see churches, businesses, and families more secure, more effective, and more efficient in fulfilling their mission and bringing glory to God.