When a Last Will and Testament or Revocable Living Trust is created for inheritance estate planning purposes, the testator or trust maker will name beneficiaries to receive his or her property. If any beneficiary receives less than her or she expected or is omitted does that person have a claim to receive a portion of the estate? The answer depends upon state law and the relationship of the beneficiary to the decedent.
In community property states, a spouse may have a right to half of the marital estate upon the death of the other spouse. If the decedent chooses to completely leave his or her spouse out of the Will or to leave the spouse a portion smaller than half of the estate, the surviving spouse may have a claim against the estate.
In states where community property rules do not exist, a spouse may still have a right to a certain percentage of the estate. This percentage may depend upon how long the couple has been married and what assets were brought into the marriage versus purchased during it. If you are a spouse who feels you may have lost some of your estate to a deceased spouse's estate you may want to seek the assistance of a qualified estate planning and probate attorney.
A former spouse does not automatically have the right to inherit property from their deceased former spouse's estate. If, however, a couple is separated but not yet divorced, the surviving spouse may have a claim against the marital estate.
If your parent intentionally excluded you from his or her Will, you may not have the right to inherit unless special circumstances exist. If you were omitted from your parent's estate you may want to speak to a qualified inheritance estate planning attorney to discuss your rights. For example, if a child is born after a Will is created and the parent never revises that Will, the child may be able to receive a share of the estate.
On the other hand, if a parent explicitly states that a certain child is to receive nothing from the estate, that child may have little or no grounds to assert a claim or interest in the estate.
It is crucial to keep your Will, Testament, or Revocable Living Trust up to date. Work with an inheritance estate planning attorney to get started or to simply revise your plans.
Begin Inheritance Estate Planning
In a challenging economy we are often tempted to "DIY" (do it yourself). So, is it possible to write your own Revocable Living Trust? Yes, but you should know the disadvantages to a poorly drafted Living Trust before you begin.
There are three positions in the creation of a Revocable Living Trust Agreement: the Trustors, the Trustees, and the Beneficiaries. After completing the trust agreement, it is vital that you fund all assets into the name of the Trust. If you fail to set up and fund the trust properly, you risk at least two unhappy consequences: disinheritance and probate.
When you create a Trust, it is important to maintain your beneficiary designations. You must add new beneficiaries when they are born or join your family and take out beneficiaries who are deceased or have left your family. If you write your own Trust, you will be solely responsible for this. If you do not add or delete a beneficiary, or fail to do so in the proper form, you could possibly disinherit a loved one, or include someone who is no longer in favor. Many attorneys have a maintenance program, so your Living Trust can receive regular reviews to be certain you to update your beneficiaries properly.
One important purpose of a Revocable Living Trust is to avoid probate. Probate is a costly and time consuming procedure. If you create your own Revocable Living Trust, you are increasing the chances that your family will have to deal with this sticky process.
When you hire an attorney, he or she can help you properly fund your Trust, make sure you have not left out an heir and ensure that your trust agreement meets current estate law. If your document is not properly drafted, probate may be needed for your entire estate. If you have not removed deceased beneficiaries, a court may have to determine who your beneficiaries should be. Further, if you have not properly funded your assets into your Trust, the only way to do so is through the probate process.
Your attorney can also help you create a Pour Over Will. This Will may assist if you leave any asset out of your Trust. A Pour Over Will is a safety net to transfer your assets into your Trust typically through a short version of probate.
If you create your own Trust, you will also be responsible for your own Will. If you leave property out of your Trust and you don’t properly create a Pour Over Will, a prolonged probate will be needed to determine the rightful heirs-at-law.
When you "do it yourself" to repair a leaky pipe, it may just require a plumber to do it right, if your repair fails. Writing your own living trust is a complicated process that could be many times more expensive and time consuming when it is not done right. This is no time to DIY.
To learn more about living trusts, the living trust lawyers at Anderson, Dorn & Rader are here to help. Call (775) 823-9455 to schedule a consultation today.
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When you pass away, your estate must be settled. If you have an estate plan, such as a trust or will, then your assets will be distributed in accordance with your estate planning documents. It is called “intestate succession” when you don’t have a trust or will when you pass away. Your estate will be distributed according to the laws of the state of your residence and any other state where you might own real estate.
Now, before you start thinking this might not be so bad, consider this:
When you die intestate, you have no say over how your assets are distributed or who will oversee the process. With a will, you may designate an executor, someone you trust to ensure your estate is properly administered and that your assets are divided up the way you want. This process is overseen by a court and is known as a probate. A trust works in a similar way allowing you to designate a trustee to oversee the process except that a court is generally not involved maintaining the privacy of your beneficiaries.
But in the absence of a will or trust, the court will appoint a personal representative to oversee your estate. This person will be responsible for not only distributing your assets but also settling any outstanding debts and selling off assets if there’s not enough funds in the estate.
That means that some of your most treasured heirlooms – the baseball card collection, the antique grandfather clock or your great-grandmother’s sterling silver tea set may very well end up being sold in an auction rather than in the hands of your loved ones. And of course, you won’t be around to stop it.
To learn more about the dangers of Nevada intestate succession and to create your own estate plan to prevent this from happening, contact the estate planning attorneys at Anderson, Dorn & Rader, Ltd.
Learn More About Intestate Succession
For starters, a living trust allows your heirs to avoid probate, an often costly and time-consuming legal process used to distribute your assets. With a trust, the distribution is handled within the trust documents. Because the trust technically owns the assets, no probate is required.
Unlike a will, the details of your trust are not public record. That means your estate remains private and your loved ones are protected from would-be con artists and overly aggressive sales people looking for a quick bargain.
A trust also gives you some options that you can’t get with a will. You can create incentives for your heirs for example, allowing them to increase the amount of their inheritance by achieving certain goals and objectives. Perhaps you set up the trust to match whatever income they earn on their own or to encourage higher education, your heirs can receive a bonus if they graduate college.
Likewise, you can use your trust to ensure that heirs with behavioral problems or addictions get help before inheriting a large sum of money.
Another one of the benefits of a living trust is that it also streamlines the entire distribution process, allowing you to create a legacy that can provide for multiple generations to come.
If you're still having trouble choosing between a will or living trust for you estate planning purposes, speak with the living trust lawyers at Anderson, Dorn & Rader, Ltd.
Probate is a legal process wherein a court oversees the distribution of a deceased person's estate to the heirs or beneficiaries of the estate after the payment of all debts, obligations and funeral expenses. A Nevada probate proceeding helps fulfill the wishes of the deceased as specified in a will. In case there is no will, the distribution of the deceased’s estate is made according to the applicable state laws.
The time required to complete the probate process depends on several factors including:
With the above factors in mind, the probate process may be completed in nine to twelve months or may take years. The probate process can be delayed if the validity of the will is contested, if there are disputes relating to the settlement of the debt of the deceased, or if there is a delay in finding beneficiaries. Tax issues can also delay a probate process.
The cost of the Nevada probate process may be set by the applicable state laws or by practice and therefore differs from state to state and case to case. The general costs included are:
Although some of these charges are fixed per state law, legal and accounting fees can be negotiated. However, in case of any type of disputes or litigation, the probate process may continue for months, if not years, and involve a number of additional costs.
To learn more about probate and Nevada probate laws, speak with a probate attorney at Anderson, Dorn & Rader. Our Reno law firm also provides free reports that further explain a probate.
When you write a Nevada will, it must be witnessed by at least two people. If you are writing your own will (and you shouldn’t be), who would you want to be involved more than family members to act as those witnesses?
Before you have your loved ones certify your will, keep in mind that this may create problems you had not thought about. By law, anyone who stands to inherit under your will must not be a witness. This includes not just your spouse and children but also any siblings, aunts, uncles and even friends.
Here’s why:
A witness is attesting to your state of mind when the Will was made. They are telling the courts that, to their knowledge, you weren’t be coerced, you weren’t under duress and you were thinking clearly when you decided how your assets would be distributed.
Let’s say that someone decides to contest that will after you’re gone. If Uncle Bob gets the greatest share of the estate and is also a witness to the will, who’s to say he didn’t influence your decision regarding how the assets should be distributed? Or someone could claim that Uncle Bob found information that could be embarrassing and threatened you with it.
To remedy this, you should always choose witnesses that have absolutely no interest in your will. This means that not only should Uncle Bob not be a witness but Uncle Bob’s girlfriend shouldn’t play the part either. The more neutral the witnesses, the better chance you’ll have of the courts enforcing your will in a contest.
To learn more about writing a will and why you should be cautious about who you choose to witness your will, get in touch with an estate lawyer. The estate planning lawyers at Anderson, Dorn & Rader are here to guide you but not persuade you in any which way. Consider choosing your lawyer as a witness to your will!
CHOOSE A WITNESS FOR YOUR WILL
A pot trust (also referred to as family trust) is a single trust for all of the children in the family that is used in the event that both parents die before the children reach a designated age of maturity. It offers some unique pros and cons for your beneficiaries.
An advantage to having a pot trust is that the trustee may be given the flexibility to spend the funds in any way he or she deems fit. That means that little Jimmy could have tuition paid to attend a trade school while Mary's tuition at an accredited university is paid if that’s what the trustee determines is in their best interests. However, if you gave a trustee broad discretion to make these types of decisions, you should be assured that your trustee is someone in whom you can place your confidence to make the decisions as you would desire.
Another consideration is that the trust is set up to operate until the youngest of the children reaches the designated age. Any funds then remaining in the trust would be disbursed equally to all the children. But if there’s a large gap in ages between your children, the older children may be waiting a significant time to receive their portion of the inheritance.
Of course a pot trust is only one toll of many to provide an inheritance for your children after you’re gone. To learn more about inheritance estate planning, get in touch with Anderson, Dorn & Rader.
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A no contest clause, also called an in terrorem clause, is essentially a statement in your will or revocable living trust that threatens to disinherit an heir if he or she formally challenges the document.
This is designed to discourage beneficiaries from disputing the will or trust in court in the hopes of getting a bigger inheritance. Of course, the power behind the clause will depend upon how much the beneficiary stands to lose versus how much they could potentially gain.
In 2009, the State of Nevada beefed up its no contest clause to also include an exception for challenges brought in good faith and with probable cause. Under the new law, the statute instructs the court to enforce a no-contest clause unless the person challenging the document can show that “…a reasonable person, properly informed and advised, to conclude that there was a substantial likelihood that the will was invalid.”
A no-contest clause should be included in any will or trust. Just remember that probable cause relies on the “reasonable person” test. So if you’re intending to disinherit a family member or drastically reduce the amount he or she is to inherit, you should be very specific about your intentions and your reasoning in your legal documents.
This tells the court that it wasn’t simply an oversight and that your document reflects your true intentions.
To learn more about contesting a will or a trust, give the estate planning attorneys at Anderson, Dorn & Rader a call at (775) 823-9455.
Most people have heard of a will and many assume that it's the basic estate planning document. Others assume it's the only document necessary to settle an estate. The will is a necessary document. While passing on assets typically requires a probate will, your family will at least have a legal document establishing the manner in which assets will pass to named beneficiaries.
While a will can take care of many things, there are some assets not covered by this legal document. As a general rule, wills only cover assets that you own, such as your belongings and assets that are titled in your name. Wills do not govern other legally binding documents that have the ability to “stand on their own” without the need for a Will.
One example of this type of asset is life insurance. A life insurance policy is a legally binding document that names the beneficiary and the amount to be paid. Upon your death, the terms of this document will be executed without reference to a will, so it is considered separate and will not be subject to the probate process. The same is true of retirement plans.
There are also other assets that may have TOD (‘transfer on death’) and POD (‘paid on death’) attached to them, such as bank accounts and savings bonds. This means that upon death, these assets will be transferred or paid to your nominated beneficiaries, regardless of what your will might say.
Any assets jointly owned will also pass automatically to the other person upon your death. The will does not direct this. Now, even though the above assets are not covered by a will, it’s still advisable to have one.
A will can cover a variety of property, ensuring that your belongings and assets are distributed the way you want. It can also establish a trust for minor or disabled dependents, leave money to charity, and handle a number of other issues upon your death.
Knowing what is and what is not covered by your will is the first step in planning your estate. Because each person is different, it’s best to have a good estate planning attorney guiding you through the process. The estate planning lawyers at Anderson, Dorn & Rader, Ltd. can help!
You've completed your estate plan and you feel like a major weight is off your shoulders. Keep in mind, however, that this is not a one-time process. Remember, changes in your life might affect your estate plan.
For example, any of the following instances in your life would require you to make changes in your estate plan: marriage or divorce, birth of children, adoption, receiving an inheritance, selling or buying a business or property, winning the lottery, retirement, or moving to a new state.
Any of these changes in your life will require you to reevaluate your estate planning choices. When possible, it is always a good idea to plan a meeting with your estate planning attorney before the changes actually take place. You may want to update your plan because you wish to change beneficiaries or change the share being given to a particular beneficiary. You might change your opinion about people or loved ones. Your family structure might undergo a change. All these instances would require a change in your estate plan.
Apart from changes in your own life, tax and estate planning laws also keep changing. There may be new strategies of which you wish to take advantage. In all probability, a change would affect your estate plan, requiring an update.
If you are a client of Anderson, Dorn & Rader, you know the best way to avoid missing a required update or revision in your estate plan is to attend our annual client appreciation event. At our next event you will be invited to participate in an annual maintenance program that will allow you to be aware of law changes and to amend your trust for no additional fee, in many cases. In any case you should schedule a regular estate plan update every three to five years. Like a fine automobile, your estate plan will function more smoothly when the time comes to use it if it has regular checkups and service. If it has been a few years, give us a call and let's review it together.
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Are you thinking about creating joint accounts to avoid the process of probate? These co-owned accounts are a common way to assure that your funds pass quickly to your loved ones without the need for probate. You should be aware, however, there are some pitfalls involved in joint accounts that you will need to consider.
A joint account can transfer to the surviving account holder(s) upon the death of another joint owner. For this to happen, the survivor(s) will need to provide a death certificate to the institution where the account is held.
Perhaps you wish for more than one person to inherit the money in a joint account. Unless their name is on the account, they will not, even if you have so stated in your will or trust. The only way for another person to have a share of this money, if they are not on the account, is for the surviving account holder(s) to gift it to them. Because the funds in the account are now owned by the survivor, making such a gift may cause your loved ones to pay a gift tax if the gift is over the annual exclusion amount.
Another issue arises when one of the account holders has not contributed money into the account. When this is the case, if the account owner dies and the money passes to non-contributors, these funds may be considered a gift and the gift tax may be applicable.
Joint accounts are especially troublesome when there are creditors of one of the account holders. If one of the account holders loses a lawsuit, the account may be frozen or garnished to cover the liability. For this reason many people should avoid holding joint accounts.
What if you wish to leave your account holdings to a child who is still a minor? If you put the child on your account, upon your death your account will be controlled by a court appointed guardian until the child reaches eighteen. Then at age eighteen the entire account is available to that young person.
It is usually a better option to have the accounts held in a revocable living trust. In the event of disability, the trustee will still have access to your account, but their creditors will not. If the beneficiary is still too young, it can remain in trust and made available for their education and other needs, but not turned over to them until an age when they are more likely to have matured.
Joint accounts can be one among many useful estate planning tools. They are simple to set up and administer, but they may have serious disadvantages. Be sure to visit a qualified estate planning attorney to become fully informed.
CONTACT A RENO ESTATE PLANNING ATTORNEY
While a living trust and living will may sound similar they are actually two quite different things.
A living trust is designed to help protect and distribute your assets. The assets are actually titled in the name of the trust and depending upon the terms of your trust, you may have complete control or hand the management of the trust over to someone else. Upon your death, beneficiaries receive the assets according to your terms in the trust. A method of avoiding probate, it’s a way of bypassing the lengthy and often expensive court process of distributing your assets.
A living will, however, is a legal way of informing your physician what you want done in case of a terminal condition. It’s used when you can no longer communicate your wishes due to an injury or illness that leaves you incapacitated. Your living will should be accompanied by a health care power of attorney. This document designates a person to speak on your behalf and relay your wishes with regard to certain medical treatments and decisions. It might relate to resuscitation, feeding tubes, etc. These "advance directives" also give loved ones peace of mind knowing that they are doing what you would have wanted.
It’s highly recommended that everyone draw up advance directives including a living will and a health care power of attorney, whereas a living trust is especially beneficial for those with a certain level of assets. To get help with a living will or living trust, a good estate planning attorney is your best bet.
