DEFINITIONS: Here are some brief explanations and definitions of the estate planning terms attorneys use and discuss:
WILLS: A Will provides for the distribution of your property after you die.
TESTAMENTARY TRUSTS: A special clause added to your Will to provide for minor children or others, naming a guardian and a trustee.
REVOCABLE/”LIVING” TRUSTS: More comprehensive and flexible than a Will, a Trust not only provides for matters after you die, but while you’re still alive. A trust provides protection for you if you are disabled. It gives you more control over the use of assets, and can help plan for the ongoing maintenance of investments or a business. Used properly, Trusts can help avoid or lessen the impact of estate taxes, and can also aid in bypassing the probate process. Trusts can also help protect your privacy: A Will is required by law to be filed with the Court, making it a a matter of public record; Living Trusts are private.
ADVANCED DIRECTIVES: All estate plans should include documents that will protect you and alert the world to your intent in the event you become disabled, including living wills, powers of attorney for property and health care, and authorizations for release of health care information (commonly known as a “HIPAA authorizations”).
LAND TRUSTS: A land trust is useful for individuals and corporate entities to hold real estate, for estate planning purposes, for avoiding probate, as a shield to liability, to help protect privacy, or to help manage real estate investments. With a land trust, title to the property is conveyed to a Bank as the Land Trustee, with you (or someone you name) as beneficiary, holding a “power of direction,” which gives you the authority to control the trust.
SPECIAL NEEDS PLANNING: Families with disabled adult children need to plan carefully so that a child’s potential inheritance will not disqualify them from government benefits.