Archive for the ‘Trust and Estate’ Category
Unlike a Will, a Living Will a document spelling out what kind of medical care a person wants if he or she should have a terminal illness or become incapable of communicating his or her wishes. A Living Will can set out the kinds of treatment a person does or does not want in any circumstances. This could include telling medical personnel when to maintain life support, when to turn it off, and when not to resuscitate you. If you don’t leave these instructions, someone else will make these decisions for you if you should become incapacitated.
The name of this document, often called a Living Will, is confusing, since this document isn’t really a Will at all. It doesn’t do things a Will does, like transfer your property or name guardians for your minor children. Even if you have a Living Will, you still need a Will, or some other estate-planning document, such as a living trust, to do those things.
There’s also an alternative to a Living Will called a Durable Power of Attorney (DPA) (also called a Power of Attorney for Health Care). Instead of giving instructions about your medical care if you become incapacitated, a DPA names a person you trust to make those decisions for you. One advantage of a DPA is that your representative can make medical decisions based on the most up-to-date treatment information and make decisions about anything you haven’t covered in your Living Will, such as deciding on medication choices, surgery options, or choosing physicians or treatment facilities.
Unlike other living trusts, an ILIT is irrevocable. Once a policy is transferred to it, the trust cannot thereafter be changed. If, and only if, you survive for three years after transferring the policy to the trust will the insurance proceeds not be taxed in your estate or your spouse’s estate. The resulting death tax savings can be very substantial. It is, therefore, very important for you and/or your broker to have the policy transferred to the trust as soon as possible. If you have not yet made application for the policy, then it would be best if the policy was, in fact, purchased directly by the trust rather than purchased by you and then transferred to the trust. It is possible that we can avoid the “three year wait” if this procedure is followed. Read the rest of this entry »
