One of the reasons why it is advisable to reach out and develop an ongoing relationship with an estate planning attorney is because of the personalized attention that you will receive. Each individual is different, and every family has a different dynamic. Everyone is going to pass away someday and the wise individual is going to plan ahead intelligently.

The only way to do this effectively is with professional guidance, and in fact it is very likely that you are going to have to update your estate plan over the years. When your attorney gains an understanding of your situation while devising an initial plan he or she will be well-positioned to make the appropriate recommendations as things change in your life.

Your attorney may examine your situation and recommend a revocable living trust. These vehicles provide for an efficient transfer of assets after your passing, but you have total control of them while you are still alive. You may choose to serve as the trustee and the beneficiary while you are living and you can make changes as you see fit. As the name implies, you can even dissolve the trust if you choose to do so.

In addition to the control and flexibility that revocable living trusts provide, you can also include incapacity contingencies and this is part of the appeal as well.

The creation of a revocable living trust is an option that is available to you. To explore this and other estate planning instruments, simply take a moment to arrange for a consultation with an experienced, dedicated central New Jersey estate planning lawyer.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

One of the aspects of elder law that is moving to the forefront of the consciousness of many estate planning attorneys is that of incapacity planning. When you examine the dominant trends you see a confluence of two major factors that make incapacity planning totally essential to the modern estate plan.

For one thing, the elder population is growing and people are living longer than ever. Some 10,000 people are filing for Social Security every day, and the segment of American society that is at least 85 years of age is growing faster than any other. This is the first fact to keep in mind.

The second factor to consider is the high rate of dementia cases among the oldest old. It is estimated that about 50% of people who have reached the age of 85 are suffering from dementia. Dementia can strike with varying degrees of severity, but it is very common for dementia sufferers to become unable to make sound financial and medical decisions for themselves.

If you do not take the appropriate steps to appoint decision makers of your own choosing to act in your behalf in the event of your incapacitation, the state can appoint a guardian to act in your behalf without your consent.

The way that estate planning attorneys can help you avoid this would be to include durable powers of attorney in your estate plan. In this context the “durable” designation makes the document valid even after the incapacitation of the principal.

Most plans will include a durable medical power of attorney and a durable financial power of attorney to address each of these separate areas of decision making. Since the the person who is best suited to handle your finances may differ from your preferred medical decision maker you can indeed name two different attorneys-in-fact in the two respective documents.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

Though it could be suggested that you should have an estate plan in place as soon as you become an adult in the eyes of the law, as long as you are single and sans significant assets you can probably put it on the back burner. But once loved ones are depending on your income to maintain their standing of living an estate plan does become essential. This is true when you get married and your spouse is relying on you, and it becomes doubly important when you have children. If you and your husband or wife were to be killed suddenly in an auto accident, who would care for your children? Where would the financial resources come from? These are the questions that you need to answer in your estate plan.

You can address the matter of who will be raising your children on a day-to-day basis by naming a guardian in your will. As for the financial side, most young couples have not had enough time in the working world to amass financial reserves that are sufficient enough to provide for the needs of their children for ten, fifteen, or twenty years. Life insurance is the solution, and the way that the proceeds can be handled in behalf of dependent children is though the creation of a testamentary trust.

A testamentary trust is created via terms elucidated in your last will and testament; as the name implies it is a trust within a will. You name the trustee and this person will administer the assets in the trust, which may be largely comprised of insurance policy proceeds, until the children become adults per your wishes as stated in the will. Clearly the role of the trustee is an important one. He or she must administer the trust for its duration, and it can be a time consuming affair that involves ongoing interaction with the probate court. So it is important to choose your trustee carefully and make sure that this person is fully aware of the totality of the responsibility that he or she would be undertaking.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

The estate tax is scheduled to come back with a top rate of 55% in 2011, and over the years this rate has fluctuated but it is generally somewhere in the vicinity of 50%. Many people question the fairness of a tax that sucks up half of the wealth that you have accumulated throughout your lifetime, especially considering the fact that you paid plenty of other taxes along the way. Because this tax is so devastating to the value of your assets, estate planning attorneys recommend strategies that can help you avoid the estate tax, and one of these involves the creation of a generation-skipping trust.

With these trusts you name your grandchildren as the beneficiaries, skipping a generation, as it were. The assets that have been placed in the trust are not subject to estate tax, but they are subject to the generation-skipping transfer tax. However, there is an exemption that should be in the vicinity of $1.4 million in 2011, so you can avoid this tax as well if the value of the trust does not exceed this exclusion amount.

Though they are not the named beneficiaries, your children can benefit from the trust. They can receive cash distributions, live for free in a home that has been placed in the trust, and in fact, they can even control disposition of assets to parties other than themselves through a special power of appointment. They can enjoy this access and control, but creditors, former spouses, and other potential claimants cannot target assets that have been placed in the trust.

To maximize the long term utility of generation-skipping trusts, your children can create one of these as well, naming their grandchildren as the beneficiaries. By employing this strategy generation after generation your family can avoid the estate tax and keep the wealth that has been built over the years intact and in the family.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

In 2011 the estate tax is going to be in force, and what is especially noteworthy about it is the change in the exclusion. When the tax was last in effect in 2009 the exclusion amount was $3.5 million, meaning that only the portion of your estate that exceeded that amount was subject to the tax. If your estate was worth less than this, you owed no estate tax. In 2011 the exclusion amount has been reduced to just $1 million, so those with estates valued between $1 million and $3.5 million are now in the crosshairs of this federal levy that carries a maximum rate of 55%.

Your most valuable asset may well be your home, and due to this change in the exclusion it may be your residence that pushes your estate’s value above $1 million. So if you can remove the value of your home from your estate without losing anything in the process you could effectively escape estate tax liability. If you are in this position, you may want to consider the creation of a qualified personal residence trust.

With these vehicles you place the home into the trust and name your children or whoever your heirs are as the beneficiaries. You can then continue to live in the home rent-free without skipping a beat, but the value of the home has been removed from your estate. When you draw up the trust you state the term during which you will be living in the home, and this is considered to be your “retained interest.” It should be noted that if you were to pass on before this term was up the property would revert back into the estate.

There is a gift tax applicable to the transfer of the home, but the fair market value of the home is not used to calculate gift tax liability. The actuarial value of your retained interest is deducted from the taxable value. If this amount does not exceed the lifetime gift tax exemption of $1 million, the property was passed on to your heirs free of the gift tax and the value of your estate has been reduced for the purposes of estate tax efficiency.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

If you are on the outside looking in it may seem as though wealthy people who are planning their estates feel akin to jolly old St. Nick, capable of making the financial dreams of their loved ones come true. It would be disingenuous to suggest that being able to provide for your family after you pass on is not a blessing of sorts, but it’s not without its pitfalls.

We have all seen reports of the children of very wealthy people struggling in various ways throughout their lives, and there are those who have met tragic ends. There are also countless others who may not have been especially tortured who simply never reached their true potential because they saw no reason to work toward anything.

One possible solution that is often put to good use is the incentive trust. These are trusts like any other with your heir as the beneficiary, but you place stipulations that must be met in order for funds to be distributed. You can place any stipulations that you want to as long as what you are requiring is not illegal.

For example, you may set up the trust to make distributions as long as the beneficiary stays in college and provide for a lump sum distribution upon completion of graduate school. To promote a work ethic and a career path you could stipulate that the balance of the trust will be distributed in four benchmarks five years apart as long as this heir remains employed.

Should you have a family member who has a problem with self destructive behavior you could put stipulations in place that act as an incentive to avoid this activity. For example, you could allow for distributions contingent upon the results of ongoing drug testing and/or completion of a rehabilitation program.

Incentive trusts are not a panacea, but they are an option and something that you have in your estate planning tool kit should you feel as though creation of such an instrument may be able to provide you with some peace of mind.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

There are any number of confusing acronyms and unfamiliar terms tossed at you when you start to get serious about planning your estate. But there is one estate planning vehicle that everyone is very familiar with, and that would be the will. Of course there is the standard will that is used to state your wishes with regard to the way that you would like your assets to be distributed after you pass away. We also recommend the living will, with which you state your health care preferences in the event of your incapacitation. But there is another type of will called the ethical will that is not a legally binding document but is a useful estate planning tool all the same.

The ethical will dates back to the book of Genesis and was originally part of an oral tradition, intended to pass moral and spiritual guidance down from generation to generation. Eventually ethical wills were recorded in writing, and they have been routinely used by the rabbinic community and Jewish laypeople for centuries. At this point the living will has become a universal, widely recommended estate planning device that has significant benefits on a practical and a psychological level for both the writer and the readers.

When you are planning your estate and taking stock of your material assets you are invariably going to evaluate your overall life’s path; your decisions, your actions, and the lessons you learned along the way. This type of introspection is especially meaningful when it is taking place during the latter stages of your life. If you record your ruminations in an ethical will it can help to guide you as you are deciding on the details of your estate. In addition, once those decisions have been made, your ethical will can provide your loved ones with some rules to live by as they take on new levels of responsibility when they become the stewards of your legacy.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

There are those who adopt a DIY approach to life and look for ways to economize by sidestepping the use of professionals and tradesmen when they can, but this is tricky business. The disclaimer “when they can” is operative here because there are some things that most people can indeed do on their own, and there are others that are best left to the experts.

These days you see legal forms marketed on the Internet for just about every purpose, and “do-it-yourself” will kits are one of them. When you consider the possibility of drawing up your own will, it is a good idea to recognize what will become of it upon your passing.

Wills have to go through the legal process of probate, and this involves the surrogate court examining the will for the purpose of determining its validity. The court then presides over the administration of the estate in accordance with the terms that are elucidated in the will. If any interested party wanted to contest the will or make a claim against the estate, their arguments would be heard during probate.

The reason why you don’t draw up your own agreement when you buy a car or a house is because the precise verbiage in the contract is extremely important, and contingencies must be addressed. The same thing is true of a will. This is a legal matter with significant ramifications, and it calls for the expertise of an experienced probate attorney who is familiar with the laws of the state in which you reside.

In any endeavor, most of us implement a risk vs. reward equation when we are trying to weigh the pros and cons involved in a given situation before making a decision. Clearly, there is significant risk involved in trying to draw up your own will, and for all intents and purposes, there are are no potential rewards.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

You may know more or less what you want to accomplish when you start planning your estate, but there are so many facets to consider it can be difficult to compartmentalize these objectives. Here are three useful estate planning vehicles that can be used to provide a foundation to work with as you proceed.

Living Will

A living will is a commonly executed advance health care directive, and it is used to allow people to state their preferences regarding the types of medical procedures they will allow in the event of their incapacitation. The matter of the use of life support systems in cases when a terminal condition is present is often central to a living will. However, you can record your wishes across a wide range of topics if you so choose, including things like pain control and personal comfort preferences.

Standard Will

When people hear the word “will” in an estate planning context they naturally think about the document that is used to state one’s wishes in regard to the distribution of assets upon death. These vehicles need no explanation, but it is worthwhile to note that in the past you may have heard the term “last will and testament.” When these distinctions were commonly made it was the will that was used to distribute real property while the testament was executed to divide the personal possessions of the deceased.

Ethical Will

Some of the valuables that you have acquired throughout your life are not tangible. Your morals, spiritual understanding, and personal values are precious and priceless, and if you could pass these on you may be giving the greatest gift of all. This can be done through the creation of an ethical will, which is a document that has been used throughout the ages to share the important and universal life lessons that you have learned with succeeding generations.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.

Estate planning involves the distribution of your financial assets to your heirs upon your death, and many people assume that the way this is done is through a will. Though it is true that wills are often used to define the terms of asset distribution, there are other vehicles for transferring assets that have a lot of appeal to many people. One of them is the revocable living trust.

When you are planning your estate you invariably want to make things simple for your loved ones after you pass on. When you have a will the estate must go through probate, where its validity will be determined. The probate or surrogate court then supervises the administration of the estate, and this ensures the transparency of all transactions made in behalf of the estate, so probate does provide useful protections. On the other hand, the estate administration process (not probate)can be a time consuming process that can get costly by the time legal fees, and other attenuate expenses are paid if your estate is not properly set up.

Revocable living trusts are an alternative in the right circumstances. After you fund the trust you as the grantor select a trustee or trustees and you name your beneficiaries. You can act as trustee while you are living, so you retain control of the assets in the trust. You name a successor trustee who will administer the trust according to your wishes after you pass on. This can be a single individual, multiple people, or an entity such as a bank or a trust company. Upon your death the assets are then transferred to your beneficiaries and are usually not subject to probate if properly funded. Since the trust is indeed revocable, you can change it as you see fit or dissolve it altogether at any time.

Revocable living trusts are a good option in the right circumstances due to the efficiency and flexibility that they provide if set up correctly. Whether or not a living trust is the right choice for you would depend on the details of your wishes and the size and scope of your estate.

The Augulis Law Firm is a member of the American Academy of Estate Planning Attorneys.