Paralegal Power Break: The Estate Plan & Wills
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Transcript of Paralegal Power Break: The Estate Plan & Wills
The Estate Plan and the Purpose and Need for a Will
Estate Plan
• An arrangement of a person’s assets using the laws of various disciplines (wills, trusts, taxes, insurance, and property) to gain maximum financial benefit of all the laws for the disposition of the person’s assets during life (inter vivos) and after death
Will
• A legally enforceable written declaration of a person’s intended distribution of property after death
Requirements to Make a Will
• Capacity– Legal capacity
• The age at which a person acquires capacity to make a valid will, usually 18
– Testamentary capacity• The sanity (sound mind) requirement for a
person to make a valid will
Terminology of Makers of Wills• Testator
– A male who makes and/or dies with a valid will
• Testatrix– A female who makes and/or dies with a
valid will
Requirements of a Will
• Written Document• Witnesses• Date (in most states)• Signature of the Testator/Testatrix• Sound Mind of the Testator/Testatrix• Legal Capacity of the Testator/Testatrix• Selection of Personal Representative
Formal Probate
• A court-supervised administration of a decedent’s estate– Decedent: A person who has died
Terminology of Wills
• Beneficiary– A person entitled to receive property under
a will• Devisee
– A person who receives a gift of real property under a will
• Legatee– A person who receives a gift of personal
property under a will
Terminology of Intestacy
• Intestate– A person who dies without a valid will
• Heir– A person who receives a gift of real property
from an intestate• Next of Kin
– The closest blood relatives of a decedent
Terminology of Wills
• Ambulatory– Subject to change
• Codicil– A written amendment to a will
• Letter of Instructions– A document that specifies a testator’s
intentions for organ donation and funeral and burial plans but does not amend or change a will
Residuary Estate
• The remaining assets of a decedent’s estate after all debts have been paid and all other gifts in the will have been distributed
Property Distributions
• Tenancy in Common• Joint Tenancy
Structure of an Estate
• BeneficiaryTestator
PersonalRepresentative
Estate
Letter of Instructions
Trusts
• Trust– A right of property, real or personal, held by
one person for the benefit of another• Testamentary Trust
– A trust created in a will; becomes operational upon the death of its creator
• Inter Vivos Trust– A trust that is effective during the life of its
creator; becomes operational immediately after created
Structure of a Trust
• Settlor
Trust Estate
Trustee
Beneficiary
Inter Vivos Gifts
Title
• Legal Title– The form of ownership of trust property held
by the trustee, giving the trustee the right to control and manage the property for another’s benefit
• Equitable Title– Provides the right to the benefits of a trust to
the beneficiary
Trustee
• The person or institution named by the maker of a will or creator/settlor of a trust to administer the property for the benefit of another, according to the creator’s provisions– Compare to an executor, who carries out
the terms of a will, and a personal representative, who carries out the terms of a will or administers an estate when there is no will
Personal Representative
• A person who administers and distributes an intestate or testate decedent’s estate– Compare to an executor, who carries out
the terms of a will
Will Substitutes
• Joint Tenancy• Life Insurance• Inter vivos Trust• Inter vivos Gift• Community Property Agreement• Transfer-on-Death Deed/Beneficiary Deed