Do I need a Will?
The general answer is yes. A Will allows you to plan how your assets are to be distributed. You also appoint a personal representative who is in charge of collecting your assets, paying any debts you may have, and distributing the balance of your estate in accordance with your Will. Even though some assets will pass directly to a beneficiary, such as a payable on death account, or a life insurance policy, the Will covers all of your remaining assets. You can also appoint a Guardian to take care of any minor children in your Will, and a trustee to handle money for a minor or an incompetent beneficiary.
How do I avoid probate?
There are numerous methods of avoiding a probate. One of the most popular is through the use of a revocable trust. A person making a trust, called the Trustor or Settlor, can create a trust during his or her lifetime. The Trustor appoints a Trustee, which can be the same person as the Trustor. The Trustor transfers assets to the Trust to hold in trust. The assets are typically available for The Trustor’s use until death. On death the assets are distributed to the Trustor’s beneficiaries as set forth in the trust. As long as the majority of the Trustor’s assets are held in trust, there will not be a probate.
Who do I select to serve as personal representative under my Will, or under a power of attorney?
You want to appoint a personal representative or agent under a power of attorney that is trustworthy, fair, and has the ability to handle your assets. Not all people have children they can trust. In those instances, a professional fiduciary may be appropriate. If you are considering an individual, ask that person if they are willing to serve. Although it is an honor to be asked, some people do not have the time, or would prefer someone outside the family serve as personal representative. Washington law requires that a personal representative be 18 years of age or older, and not have committed a felony or any crime involving moral turpitude, such as theft.
What is probate?
This is a court proceeding in which the deceased’s Will is determined to be valid, and a personal representative is appointed to administer the estate. If the estate is solvent, the court can grant the personal representative non-intervention powers. This allows the personal representative to sell property without having to obtain court permission. The personal representative is required to make an inventory of the estate and file closing documents with the court.
How long does probate take?
The time varies by estate. Typically a notice to creditors is published in the newspaper which starts a four month time period process in which creditors can file claims against the estate. So at a minimum an estate will take approximately five months. It may take longer if a home or other assets have to be sold.
How much estate tax will my heirs have to pay?
Your heirs will only pay estate tax if your estate exceeds a certain dollar amount. Washington allows an exemption of $2,054,000. The federal exemption is $5.43 million. So unless your estate is larger, there may be no estate tax. If your estate is larger there are tax planning strategies to help reduce the tax burden on your heirs. We would be happy to discuss these with you.