Authored by Melissa Lande
I am often asked what people should ask their estate planning attorney to make sure that their estate plan is complete, well prepared and will properly carry out their intentions. The questions that follow should assist you with preparation of your estate plan.
1. I do not have a large estate, why do I need an estate plan? Even if you do not have a significant amount of assets, most people should have a Will or a Trust, Power of Attorney, Advance Directive and Medical Authorization. These documents allow you to designate a person to make medical and financial decisions for you during your lifetime and allow you to plan for distribution of your assets after your death.
2. What happens if I die without a Will or a Trust? If you die without a Will or Trust, your assets will pass to the remaining joint owner(s) or to your designated beneficiaries. If an asset does not have a joint owner or a beneficiary, the asset will be subject to probate. Oregon law provides that if you probate assets without a Will, your assets be transferred to your closest family members or other relatives. However, this can be problematic if you prefer that your spouse or your heirs not receive funds outright. Also, if you are married and have children from a previous marriage, the children are immediately entitled to one-half of your assets if you probate assets without a will. You may prefer to structure your plan differently.
3. Is it important to have an Advance Directive or Power of Attorney?Yes, these are some of the most important documents that you can execute. The Advance Directive appoints a primary and alternate health care representative to make medical decisions for you when you cannot make them for yourself. The agent under your Power of Attorney manages your finances for you.
4. Who should I appoint to make decisions for me if I can no longer make them for myself? You should appoint the person that is most trustworthy. The person should have some financial management skills if they are making financial decisions for you and should not have any significant financial problems of their own since a person appointed under a power of attorney will have unsupervised access to your funds. The person appointed to make medical decisions for you should be willing to carry out your wishes regarding your end of life decisions.
5. What is a guardianship and conservatorship? If you do not have anyone designated to make medical and financial decisions for you, you may need to have a guardian or conservator appointed. The conservator handles your finances and your guardian handles the rest of your affairs such as care, placement and medical decisions. In order to be appointed as a person’s guardian or conservator, you must file a Petition with the court, obtain a bond, serve notice on the relevant parties and attend a hearing should anyone object to your appointment. One person can serve as both guardian and conservator if both are needed.
6. Are there State of Oregon and federal estate taxes? Currently, Oregon estate taxes are assessed on estates valued greater than $1,000,000. Federal estate taxes are assessed on estates valued greater than $5,250,000. With proper estate planning, married couples can each claim their exemption amount, and avoid estate tax on up to $2 million in Oregon and up to $10.5 million for Federal.
7. Can I just get forms online for my estate planning? Yes, you can find forms online. However, they are often generic and do not provide for the specific issues that you will face when making your planning decisions.
8. What should I do with my original documents? Your original documents should be kept in a safe place; typically either in a fireproof safe in your home or a safety deposit box. It is important to make sure that your personal representative or trustee knows where your documents are and how to access them.
9. How often should I review my documents? You should review your documents every three to five years or sooner if you have a major event in your life such as marriage, divorce, and birth of children or grandchildren.
10. Should I put my child on my bank accounts? Although it may work well in certain situations, placing your child’s name on your bank accounts is generally not a good idea. My clients often do so for ease of transaction. However, if that child has a judgment against them, th creditor could garnish your account. If they are involved in a divorce, their spouse could claim a right to your assets. Additionally, when you die, if only one child is a co-owner of your account, that child would receive all the funds in that account and would not be required to share the funds with their siblings.
There are many other important questions you should discuss with your estate planning attorney depending on your situation, the value of your estate and the nature of your family and beneficiaries. However, your answers to these ten questions will provide you with a good start to your personal estate planning.
