Trusts or Special Power of Appointment

Trusts or Special Power of Appointment

Once a lawsuit is filed against you and a plaintiff’s attorney discovers the existence of a domestic trust, the outcome of the suit is left to a judge or jury.  Make no mistake about it, a special power of appointment cannot protect assets held in a domestic trust if a judge or jury decides to find an exception to the law or, worse, if the judge or jury decides to make an example of your situation.  Leaving your fate to the judgment of strangers is dangerous.  Deterring litigation and keeping control is a better

Offshore Asset Protection Puts You in Control

The main problem with relying solely on a special power of appointment is that assets held in trust and the trust itself are subject to the jurisdiction of the U.S. court system.  If a U.S. court decides to disregard a trust, the assets held by that trust are easily accessible.  That’s not where you want to find yourself.  Offshore asset protection removes both the trust and the assets held in trust from the reach of domestic judges.

Cook Islands Trust Law Deters Litigation

Consider an example from the Cook Islands. If Mr. Jones sets up a trust in the Cook Islands and is later sued, plaintiff’s attorneys are not likely to attack the trust for a number of reasons.  First, the only way to invalidate a trust in the Cook Islands is with a judgment from a Cook Islands’ court.  The Cook Islands will not recognize such a judgment from a U.S. court.  The only way for a plaintiff’s attorney to get such a judgment is to sue in the Cook Islands, which is incredibly expensive, since it requires plaintiff’s to front all the expenses of litigation and does not allow plaintiff’s attorneys to collect contingency fees.

In other words, attorneys attacking a trust in the Cook Islands have to either bill their clients by the hour or work for free (after fronting the cost of international litigation), both of which are expensive propositions.  Other benefits include a hard two year statute of limitations, which means that Cook Islands trust cannot be attacked after it is has been in existence for two years!

Special Power of Appoint Revisited

It is true, as we wrote previously, that a special power of appointment contained in a domestic trust provides some level of asset protection.  It does not, however, provide comprehensive asset protection.  A savvy plaintiff’s attorney will easily be able to discover the existence of such a trust, unless you are willing to lie under oath, which is never advisable.  In addition, plaintiffs lawyers have incentives to attack domestic trusts, which leaves the assets in such trusts subject to the whims of the U.S. legal system.

An offshore asset protection trust makes litigation very expensive and, therefore, deters lawsuits in the first place.  Even if an offshore trust is attacked, the laws in many foreign jurisdictions are stacked so in favor of asset protection that an adverse judgment is almost inconceivable.

Combining Forces Offshore & Power of Appointment

While an offshore trust provides the most comprehensive form of protection in itself, there is nothing to prevent you from seeking to combine that protection with a special power of appointment.  If you have questions about how to accomplish that goal, ask an asset protection attorney.

Free Consultation with a Utah Estate Lawyer

If you are here, you probably have an estate issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Ascent Law LLC

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How to Be the Personal Representative of an Estate

How to Be the Personal Representative of an Estate

Probate Law in Utah is a vast subject and your will has an important function beyond providing instructions for the distribution of your property. It also names the person who will serve as the executor your estate. The executor has the job of paying your final bills, and distributing any remaining assets. We’ve brushed up against this topic before here.

When someone dies without a will, it’s called dying “intestate.” In these situations, no one may have legal authority to close the deceased’s estate. Probate court can step in to select someone to perform these duties or a loved-one can volunteer to fill the vacancy. This court-appointed representative is known as an administrator. The duties performed by an administrator are essentially the same as an executor.

These basic steps will show you how to file for executor of an estate without a will:

Determine Your Priority for Appointment

Probate rules are established by your state and include identifying who can serve as an administrator and the priority of appointment. A surviving spouse usually is given first choice at filling this role. If they decline, the deceased’s children are next in line. When there is no spouse or children, a family members may be selected. If more than one person with priority wants to serve as administrator, and the heirs can’t agree, then the court will choose.

Many states have laws prohibiting certain classes of people from serving as an administrator / executor. In Texas, for example, a person who is a non-resident can’t be appointed. Neither can someone found guilty of a felony, even if it occurred 30 years prior. In some states, when no family member has come forward to administer the estate, then a creditor of the deceased may serve as administrator.

Receive Written Waivers From Other Candidates

You need to receive a written waiver from other candidates for administrator that have higher priority. For example, if you are the brother of the deceased, you may need to get a written waiver from the deceased’s spouse and children before you can be appointed administrator.

Contact Court in the County Where Deceased Resided

In most states, probate will occur in the county where the deceased had residence. You need to contact that court to understand their filing requirements and timelines. Frequently you will need to file a Petition for Probate along with the Notice of Petition to Administer Estate.

File the Petition for Administration

The Petition will require you to supply a certified copy of the decedent’s death certificate, an estimate of the gross value of the estate, and the names and addresses of the decedent’s heirs. You will pay a fee to petition for administration.

Attend the Probate Hearing

Many states do not require a formal hearing unless there is a contest to select the administrator, or the administrator in not next of kin. Administrators and executors are commonly given an oath recognizing their fiduciary duties to the estate and the court.

Secure a Probate Bond

It is common court practice to require a bond to protect the interest of the deceased’s estate, its heirs and creditors. The bond also protects the administrator to ensure they fulfill their duties and responsibilities.

Free Consultation with a Utah Probate Lawyer

If you are here, you probably have a business law issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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When is Probate Unnecessary?

Probate gets a lot of negative press. You’ve probably heard stories about how time consuming and expensive it can be. Fortunately, not all property needs to go through this legal process before it passes to your heirs. So, you ask, when is probate not necessary?

When is Probate Unnecessary

The quick rule of thumb is probate is not required when the estate is “small”, or the property is designed to pass outside of probate. It doesn’t matter if you leave a will. Let’s take a closer look at each of these exceptions.

Benefits of a Small Estate

Being small can have its advantages when it comes to probate. Most states recognize the complexity of this legal process is unnecessary for transferring a modest estate. So when the deceased’s remaining property is valued below a state-determined amount, assets can be distributed to beneficiaries without going to court. In California for example, an estate valued at $150,000 or less may not need to go to court. In Nebraska, the threshold is $50,000 or less.

Figuring out if your estate qualifies as “small” only takes a few simple steps.

  1. Total up the value of your “individual” property. This typically includes bank accounts, investment accounts, business interests and real estate. The value of your personal effects, such as electronics and artwork, are also factored in. It’s unlikely more disposable items, such as your shoe collection, will be considered.
  2. Subtract the value of property with a co-owner or designated beneficiary. This topic is reviewed in greater detail in the next section. What you need to know for now is that only assets titled in your name alone, and without a listed beneficiary, go to probate. For example, a life insurance policy with a beneficiary is not included in determining your estate value. Neither does a home held as community property.
  3. Determine your state’s small estate threshold: All 50 states and the District of Columbia have laws governing most aspects of estate planning and probate. This includes setting the value of the estates that must go to probate.

Sometime can be a good idea to open probate even when it’s not required, especially if there are concerns over creditor claims or beneficiary disputes. Before relying on the small estate exemption to probate, it’s important to understand the laws of your state and how your assets are valued. Losing a loved one is a difficult time for family and friends. Don’t leave things to chance.

Property that Transfers Outside of Probate

Not all property needs to go through probate. That’s good news for beneficiaries because property that passes outside of probate is distributed much sooner. Assets that typically don’t go through probate fall into the following three categories:

Jointly Owned Property

With the “right of survivorship” avoids the probate process because ownership transfers immediately to the surviving owner(s) after a co-owner’s death. There are few ways to jointly own property that creates this right of survivorship including:

    • Community Property is the property ownership form held by married couples that has the right of survivorship. Be careful, not all states recognize the forms of joint ownership created by marriage or domestic partnerships.
    • Tenancy by the Entirety is a form of ownership only available to legally recognized couples. It works much the same way as a joint tenancy with a right of survivorship, in that effectively upon the death of one spouse, the living spouse takes the deceased spouse’s portion.
    • Joint Tenancy with right of Survivorship In this form you take property as “joint tenants” and upon the death of a joint tenant, the surviving tenant takes the deceased tenant’s portion.

Designated Beneficiary

The designated beneficiary is the person selected to inherit an asset, such as bank account, or the money from a life insurance policy. When you die, assets with a designated beneficiary will immediately transfer to the named person. Naming a beneficiary to many of your accounts simply requires filling out a short form. Assets that can have a named beneficiary include:

        • Bank Accounts stating a “payable on death” (POD) beneficiary
        • Investment accounts noting a “transfer on death” TOD beneficiary
        • Life insurance naming a beneficiary other than the estate of the deceased
        • Retirement Accounts
        • Cars or boats registered in transfer on death form


Trusts are designed to allow your family, friends and causes you care about to inherit from you without having to go through the long and expensive probate process. There are many different types of trusts serving a variety of purposes, including:

      • Revocable Trusts are created during the lifetime of the person making the trust. The trust can be altered, changed, modified or revoked during the maker’s life.
      • Irrevocable Trusts cannot not be altered, changed or modified once made. There trusts are good for passing larger estates and have tax savings properties.
      • A Charitable Trust is made during the grantor’s lifetime. It is often a financial planning tool, often providing the trustmaker or his designated beneficiary with lifetime income with the remainder going to charity.


Free Consultation with a Utah Estate Lawyer

If you are here, you probably have an estate issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

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10 Ways to Reduce Estate Taxes

The Federal estate tax can be reduced through various legitimate estate planning techniques. Following is a list of ten methods you should think about as ways to reduce your estate taxes.

10 Ways to Reduce Estate Taxes

  1. MARITAL TRANSFERS. Except where a spouse is a noncitizen, neither lifetime gifts nor bequests at death to one’s spouse are subject to estate taxes. However, the estate of the spouse will have to pay estate taxes on the spouse’s entire taxable estate, including the amount transferred to the spouse pursuant to the lifetime transfer, at the spouse’s death. Utah probate law allows these transfers and they are completely legal. Accordingly, this tool merely defers estate taxes; it does not entirely eliminate them.
  2. LIFETIME GIFTS TO CHILDREN AND GRANDCHILDREN. Each person can make annual gifts of $12,000 to any number of persons, typically children or grandchildren, without incurring a gift tax. If a husband and wife both engage in gifting, they can collectively give away $24,000 per year per recipient without incurring a gift tax. Over a period of several years the amount of money that can be transferred to a couple’s intended beneficiaries under this method is substantial, thereby reducing the size of the taxable estate.
  3. UNIFORM TRANSFER TO MINORS. This is a form of gifting used where the children are still minors. The gift is given to a custodian for the benefit of the child, and is distributed to the child when he/she reaches the age of majority. As with other gifts, the annual exclusion for lifetime gifts is used under this approach.
  4. AB TRUSTS AND QTIP TRUSTS. For 2006 through 2008, each person is currently scheduled to have the first $2 million of his/her estate pass to his/her heirs without estate taxes. This is referred to as the “unified credit” or “personal exemption.” An AB Trust is a trust designed to make sure the unified credit of each spouse is used to the full extent possible, while allowing the surviving spouse to have the use of the assets of the deceased spouse during the remainder of the surviving spouse’s lifetime. A QTIP Trust permits a spouse to transfer assets to his/her trust while still maintaining control over the ultimate disposition of those assets at the spouse’s death. QTIP Trusts are particularly popular in situations where a person is married for a second time but has children from a first marriage for whom he/she would like to reserve assets.
  5. IRREVOCABLE LIFE INSURANCE TRUSTS. By transferring small amounts of the estate (equal to the amount of a life insurance premium) to an irrevocable life insurance trust, a person can reduce the size of his or her taxable estate while creating a much larger asset (the life insurance proceeds) outside of the estate. The life insurance proceeds are generally not taxable.
  6. FAMILY LIMITED PARTNERSHIP. The family limited partnership provides a valuable estate planning tool to assist families in transferring ownership of family-owned closely held businesses to the next generation, and in protecting family assets from creditors. It also permits taxation of partnership income at the children’s lower tax rates. Additional attractive features of the family limited partnership are flexibility and revocability.
  7. PRIVATE ANNUITY. A private annuity is a sale of an asset to a younger generation in exchange for an unsecured promise to pay annual amounts to the seller for the seller’s lifetime. The sold asset is thus removed from the seller’s estate, although the amounts of the payments to the seller (unless spent) will be part of the seller’s estate.
  8. QUALIFIED FAMILY-OWNED BUSINESS INTEREST (QFOBI). The Internal Revenue Code permits a “qualified family-owned business interest” to be deducted from a gross estate. To qualify for the deduction, the following requirements must be met:
    • The decedent or family members must have owned and participated in the business for at least five of the last eight years
    • The business interest must make up at least 50 percent of the decedent’s adjusted gross estate
    • The decedent and his/her family must have owned 50 percent of the business
    • The decedent must have been a U.S. citizen or resident
    • The business must be located in the U.S.
  9. SPECIAL USE REAL ESTATE VALUATION. For federal estate tax purposes, real estate is usually valued at its “highest and best use” value. This can sometimes produce unfair results, such as where a family farm is located adjacent to more valuable commercial real estate. To address this unfairness, the Internal Revenue Code permits certain real estate to be valued at its “actual use” rather than its “highest and best use.”
  10. CHARITABLE TRANSFERS. Lifetime charitable transfers or gifts to charities upon death can reduce the size of the estate and thereby reduce estate taxes. Lifetime gifts provide the added benefit of an income tax deduction. Gifts can also be made in a manner that lets the donor retain the right to use the gifted asset or income therefrom until death.

Free Consultation with a Utah Estate Lawyer

If you are here, you probably have an estate issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Ascent Law LLC

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Who Can Challenge a Will?

Not everyone can challenge a will. For instance, you cannot challenge your cousin’s will just because you believe his estate would be better off in the hands of another relative. In addition, you cannot contest a will just because you do not believe you received a fair share.

Who Can Challenge a Will

According to Utah probate law, only “interested persons” may challenge a will – and even still only for valid legal reasons. The Probate Code identifies “interested persons” to include children, heirs, devisees, spouses, creditors, or any others having a property right, or claim against, the estate being administered. Therefore, those who may challenge a will generally fall into one of three main categories: (1) beneficiaries of a prior will, (2) beneficiaries of a subsequent will, and (3) intestate heirs.

You Must Have Standing to Challege a Will

While state laws vary from state to state, all states have laws that must be met before a will contest may take place. The first requirement is “standing”. A person who has “standing” to challenge a will is typically someone who is named on the face of the will (such as the beneficiary) or someone who is not the beneficiary, but who would inherit (or lose) under the will if the will was deemed invalid. Standing is the first requirement to overcome to contest a will. You must either show that you were named on the will (or should have been), or show that you would have received something of value (typically money) if the person had died without a will.

Are you a Beneficiary of the Will?

Beneficiaries have standing to challenge a will, whether or not they are relatives of the deceased. Beneficiaries are those who are named in a will and can include your spouse, children, grandchildren, or other relatives, but can also include friends, charitable organization (like churches, synagogues, and universities), charities, and even pets.

Are You one of the Deceased Heirs?

Heirs have standing to challenge a will because if a testator dies without having a will, heirs would receive a share of the estate through the laws of intestate. Heirs are the most commonly named beneficiaries to a will. Heirs are relatives who inherit under a will when a decedent dies “intestate”, or without a will. This typically includes spouses, children, parents, grandparents, and siblings. Heirs can challenge a will if they believe there were omitted or left with a disproportionate share in the will.

Are you a Minor?

Under some laws, minors who would like to challenge a will may do so, but only after they reach the age of majority (typically age 18). This is because minors are not legally able to initiate legal proceedings, except under the guidelines of an executor or court representative.

Does the Will have a ‘No Contest’ Clause?

Wills sometimes have what is known as a “no contest” clause as a condition of the will. A “no contest” clause has the effect of disinheriting someone out of a will. If a beneficiary losses a challenge under the will, the beneficiary may be left out from inheriting under the will, thus disinheriting the will. Because a “no contest” clause often forces a contesting beneficiary to make a “take it or leave it” decision or risks losing everything, “no contest” clauses are generally not enforceable and, in most states, anyone with standing can challenge a will if they have valid reasons to challenge it.

Free Consultation with a Probate Lawyer in Utah

If you are here, you probably have an estate issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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AB Trusts

AB Trusts

AB Trusts

Normally, when one spouse dies passing on his/her assets in a last will and testament, the estate will be taxed heavily before the beneficiaries receive it. To avoid this steep estate tax, spouses can set up an AB trust, where each spouse leaves their property to an irrevocable trust. When it comes to estate planning, an AB trust is a trust created by married couples to maximize their federal estate tax exemptions. A lot of people believe that AB trusts only benefit those with large estates. The truth is anyone who may owe estate tax can benefit from an AB trust.

 How the AB Trust System Works

When the first spouse dies, the beneficiaries (usually the couple’s children) named in the trust receive that spouse’s property. However, this irrevocable trust is to be used for the benefit of the surviving spouse, who does not technically own the property. There is a crucial condition that the property can be used by the surviving spouse and that the surviving spouse may even spend principal in certain instances. Once the surviving spouse dies, all the property rights and benefits of the irrevocable trust pass to the surviving beneficiaries of the trust. Because the surviving spouse does not own the property, it is not subject to estate tax. Setting up an AB trust this way keeps the portion of the surviving spouse’s estate that is taxable half of what it would be without an AB trust.

Surviving Spouse’s Rights Over the Assets

As mentioned, the AB trust is left with the condition that it is to benefit the surviving spouse. This gives the surviving spouse some power over the assets, depending on the provisions of the trust. This is a part of probate law that some people struggle with.

The surviving spouse’s rights and benefits include receiving all income from the trust property, including:

  • Interest
  • Using the property
  • Spending to benefit his or her health, support and maintenance, standard of living, and education

The surviving spouse maintains these rights until her death, at which time all of the property is distributed to the beneficiaries of the original trust, and all of the surviving spouse’s property is distributed to his or her beneficiaries.

Disadvantages of an AB trust

The AB trust is irrevocable. Once one spouse dies, there cannot be any changes made to the trust. This can create some issues and has even caused friction between the surviving spouse and the named beneficiaries of the trust. As mentioned, the surviving spouse’s rights to use the property are limited. Where at one time this used to be the property he or she shared with his or her spouse, to do with as they pleased, this property is now restricted to certain uses and rights.

Settling and distributing property in an AB trust can be expensive and often requires a lawyer and accountant. Furthermore, these tax laws are always changing. You’ll need to keep current, or hire a professional to keep you current, on these changes and what they mean for you and your trust. These changes may even encourage you to change or even revoke your trust.

There is a lot of paperwork and bookkeeping required in an AB trust. The surviving spouse needs a tax ID number for the irrevocable trust and must file annual income tax returns on the trust. He or she must also keep records of all the AB trust property.

Is an AB trust is Right for You?

An AB trust is best suited for those married couples who are both over the age of 60 and do not have children from previous marriages. Often times when there are children from previous marriages conflicts arise between the surviving spouse and the deceased spouse’s children about who should share in the assets. If you think an AB trust might be for you or you have more questions, you should consult an attorney who can advise you based on your specific circumstances and your specific needs.

Free Consultation with a Utah Estate Planning Lawyer

If you are here, you probably have an estate issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

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What Happens if I Don’t Have a Will?

Dying intestate, or without a will, or with no estate planning is very common in Utah. If you die without a will, your property will go through probate and is then distributed according to Utah’s intestacy laws.
Intestacy laws govern intestate property. They go into effect unless there is a valid will to testify to the deceased’s wishes or an established estate plan. In intestate inheritance, a spouse is first in line, then children, then their children, and so on. When there are no heirs in the direct bloodline, the heirs are the parents, then siblings, then nieces and nephews, and so on.

Here are some common events that may happen if you die intestate:

Your immediate next of kin, whoever they are, will likely inherit your property first: lock, stock, and barrel. If you die intestate, everything goes to your next of kin. Your next of kin are the people who have the closest relation to you. If you’re married, then that’s your spouse. If you’re not married, your closest blood relations or equivalent, will inherit your property.

Utah Intestacy Law

That son- or daughter-in-law you don’t like will get your property before that niece or nephew you do like. Marital property owned by your children is governed by the laws of the states they live in, not you. If they live in a communal property state, an inheritance is separate property so long as it is not commingled. While the laws are different in every state, property acquired by gift or inheritance during marriage by either spouse is separate property, but it is very easy to commingle and then become part of the community and subject to a 50/50 division.

Your heirs could be hit with inheritance taxes (that could have been avoided). The relatives who inherit from you may be subject to a large inheritance tax (both on the federal and state level), depending on the size of the estate and the state where the assets in question are held. While this won’t wipe out their inheritance completely, proper estate planning could have made this a non-issue. For example, a Salt Lake City estate lawyer could have helped you create a trust that would have minimized your loved ones’ exposure to taxes.

A little bit of money up for grabs has a very cooling effect on interfamilial relationships. In a perfect world, family members would all get along, never be jealous, and always do right by each other. This isn’t a perfect world. Intestacy laws don’t take into account the relationships the deceased had with anyone or what the deceased orally promised to someone. Even if widowed Uncle Bob told you he wanted you to have his ’65 Thunderbird, without a will, the car is going to his son…who doesn’t even have a driver’s license.

If you wish to dispute an intestacy inheritance, contact a Salt Lake City estate planning lawyer for assistance. They can counsel you on your rights and what course of action you can take, if any, to prove a valid claim to the estate.

An estate planning attorney is a type of lawyer who through years of mentoring, continuing legal education and experience, understands how to advise clients on getting their affairs in order to prepare for the possibility of mental disability and eventual death.

Responsibilities of an Estate Planning Attorney

• Estate planning doesn’t begin and end with a last will and testament. An attorney specializing in this field will also draft living trusts, develop a plan to mitigate or avoid estate taxes, and work to ensure that your life’s savings and assets are safe from your beneficiaries’ creditors after your death.
• He can prepare power of attorney and health care directives, arranging for someone to take care of your affairs in the event you should ever become mentally incapacitated.
• He can help you avoid guardianship or conservatorship issues if you need someone else to look after your affairs.

Qualities of an Estate Planning Attorney

• A general practitioner may not have the experience and specialized knowledge to assist you with your unique family and financial situations. Look for someone who devotes his practice to this area of the law.
• You should feel very comfortable sharing intimate details of your life and your concerns with him so your estate plan doesn’t fall short of your expectations and needs.
• Your estate planning attorney should be well versed in and up to date with the laws of your state. Otherwise, your estate plan could ultimately be deemed invalid by the court.

What You Should Expect to Pay for Your Estate Plan

Be prepared to pay somewhat higher legal fees to have your estate plan created, maintained, and updated by someone who specializes in this area of practice. You’re paying for the attorney’s expertise accumulated over years of working with a variety of different clients and taking a multitude of continuing legal education classes. As the old saying goes, “You get what you pay for.” Your estate might stand to lose far more money in the long run than the cost of paying a qualified attorney now. If estate taxes come due that could have been avoided, or if a contentious probate process drags out after your death, incurring even more court and legal fees, your loved ones may wish that you had simply spent the money to plan ahead instead. Then, of course, there’s peace of mind.

Reasons to Hire an Estate Planning Attorney

When considering if you need to hire an estate planning lawyer, consider this estate planning is serious business. One wrong word or one missing signature can change the entire intent of a will or trust. Aside from this, the reasons listed below should be enough to convince you to go out and find and hire a qualified estate planning attorney to draft your estate planning documents.

• Estate Attorney Are Necessary Since State Laws Rule Estate Plans: State laws are very specific about what can and can’t be in a will, trust, or medical or financial power of attorney; who can and can’t serve as a personal representative, trustee, health care surrogate or attorney in fact; who can and can’t be a witness to a will, trust, or medical or financial power of attorney; and what formalities must be observed when signing a will, trust, or medical or financial power of attorney. For example, in Utah, a personal representative must either be related to you by blood or marriage or, if not, then a resident of the state. This non-resident, non-relatives simply can’t serve, and in fact, won’t be allowed to serve, in Utah. Working with a qualified estate planning attorney will help you to avoid this kind of simple and yet costly mistake.
• Buyer Must Beware: The old Latin saying, “Caveat Emptor,” or “Buyer Beware,” certainly applies to estate planning. If you think that you’ll be saving a few dollars by using forms found on the internet or in a do-it-yourself book to prepare your estate planning documents, then your family will be in for a rude awakening when they learn that part or all of your will, trust, or medical or financial power of attorney isn’t legally valid or won’t work as you had anticipated. Thousands of dollars will then be spent by your loved ones working with a qualified estate planning attorney after the fact to fix your mistakes.
• Estate Attorneys Can Help Sort out Complex Family or Financial Situations: Take a look at your life and your assets to see if you fit into one or more of the following categories:
 You’re in a second (or later) marriage
 You own one or more businesses
 You own real estate in more than one state
 You have a disabled family member
 You have minor children
 You have problem children
 You don’t have any children
 You want to leave some or all of your estate to charity
 You have substantial assets in 401(k)s and/or IRAs
 You were recently divorced
 You recently lost a spouse or other family member
 You have a taxable estate for federal and/or state estate tax purposes

If one or more of these situations apply to you, then you’ll need the counseling and advice of an experienced estate planning attorney to create your estate planning documents. Otherwise, it may be a probate lawyer and your state’s department of revenue and/or the IRS that will receive the largest chunk of your estate.

Advantages of Estate Planning

Taking care of your family has always been the number one priority in your life, and that isn’t going to change. The best way to make sure they are taken care of after you pass is to establish an estate plan while you are still of sound mind. Here are the advantages of creating an estate plan:
• Provide for your immediate family: The estate plan will provide enough money for your surviving spouse to continue to care for the family. If both you and your spouse pass, an estate plan will name appointed guardians to care for your children.
• Ensure property goes to the right beneficiaries: Your estate plan will outline exactly where your assets are to go in the event of your death. This leaves no questions to be resolved by the courts or cause for family discord.
• Minimize the expenses and taxes: When you take care to create an estate plan, you should be able to keep the cost of transferring any property to your named beneficiaries.
• Ease the burdens of your family: It can be difficult to plan the funeral of a loved one when grieving. When working on your estate plan, you can outline your wishes for funeral arrangements and even set aside funds for them. This takes some of the burden off your family during this difficult time.
• Support a favorite cause: If you are passionate about a local cause or charitable organization, an estate plan can allow you to support them after your passing.
• Plan for any kind of incapacity: Life is unpredictable. If you should ever become mentally or physically incapacitated, an estate plan will outline your wishes regarding life and who will make medical decisions on your behalf.
• Reduce taxes that take place on your estate: By crafting an estate plan, you should be able to minimize the amount of taxes collected on your estate, which results in your beneficiaries keeping more of the money you set aside for them.
• Establish trustees over your estate: You’ll need someone to serve as the executor of your estate to make sure everything is handled properly. Your estate plan will name this person, which will save money and simplify the administration process.
• Provide for those who many need help: Do you have a child who has a disability? Or perhaps you have grandchildren who will be attending college in the future. Through your estate plan, you can set up a special trust to provide funds to support them.
• Ensure a business continues with a succession plan: If you own your own business, you’ll want to establish some kind of plan to keep it going after you pass. An estate plan will name your successor and outline what happens to your interest in the business.

As you can see, there is a lot that goes into estate planning, and none of these areas are ones you want to leave up in the air. By working with professional estate planning attorneys, you can make sure you have thought of everything. Without a will, your property may not go to who you want. Much of it can be tied up in probate for years, which means your family won’t get the assets they want and potentially need until it’s all settled. You can’t make assumptions that everything is going to go the way you want. Legal documentation is the only way to ensure your wishes are met.

Disadvantages of Estate Planning

• Loss of control: Once an asset is in the irrevocable trust, you no longer have direct control over it. However, in the case of a husband and wife, it is possible to create separate trusts for each, thereby collectively maintaining control. There are many pitfalls with this technique, such as observance of the Reciprocal Trust Doctrine, so this strategy should only be employed with the assistance of a skilled estate planning attorney.
• Fairly Rigid Terms: Irrevocable trusts are not very flexible. Once the terms are established, they can be difficult to change.
• The Three-Year Rule: If you include life insurance in an irrevocable trust and pass away within three years, the proceeds return to your estate and become taxable.
• The Five-Year Rule: If you put assets in an irrevocable trust and need Medicaid within a five-year period, you may have to repay all prior transfers to the trust by covering the costs of a nursing home privately. Only after you have repaid all gifted assets will you be eligible for Medicaid.
Because they have such strong advantages and disadvantages, the suitability of an irrevocable trust depends on a person’s individual circumstances. An experienced estate planner can help you decide if such an arrangement is right for you, or if you would be better off setting up a revocable trust instead.

The Estate Planning Process

As you go through life, you’re likely to accumulate some amount of wealth, assets and even just family treasures. What will happen to all those things if you die or become incapacitated? That’s where estate planning comes in. An estate plan allows you to legally specify your wishes and how you want them carried out. A well-crafted estate plan can help avoid disputes that may arise and can keep details about your family’s financial affairs private. When you’re ready to work with a qualified attorney and financial planner to write your estate plan, here are some of the key steps you’ll go through:
• Create an inventory of what you own and what you owe: Compile a comprehensive list of your assets and debts, including account numbers and contact information, as well as names and contact information for your important advisers. Keep the summary in a secure, central location along with original copies of important documents and provide a copy of the summary for the executor of your will. This list could be a piece of paper or also a digital file kept in a secure location.
• Develop a contingency plan: An estate plan allows you to control what would happen to your property and assets if you or your spouse passed away today. It also puts a documented plan in place so that if you became incapacitated, your family could carry on your affairs without having to go through court. This includes a strategy for providing income if you were to become disabled and covering potential expenses for care giving that may be needed at some point.
• Provide for children and dependents: A primary goal for many estate plans is to protect and provide for loved ones and their future needs. Your estate plan should include provisions for any children, including naming a guardian for children under age 18 and providing for those from a previous marriage if you remarry, your assets may not automatically pass to them. It also would specifically address the care and income of children or relatives with special needs that must be planned carefully to avoid jeopardizing eligibility for government benefits.
• Protect your assets: A key component of estate planning involves protecting your assets for heirs and your charitable legacy by minimizing expenses, and covering estate taxes while still meeting your goals. If necessary, your estate plan would include specific strategies for transferring or disposing of unique assets like a family-owned business, real estate or investment property, or stock in a closely held business. Many people use permanent life insurance and trusts to protect assets while ensuring future goals can be met.
• Document your wishes: If you want your assets distributed in a certain way to meet financial or personal goals, you need to have legal documentation to ensure those wishes are followed if you die or become incapacitated. This includes designating beneficiaries for your life insurance policies, retirement accounts and other assets that are in line with your goals. It also means ensuring that titles of material assets, such as automobiles and property, are named properly. Work with an attorney to be sure you have an updated will disposing of your assets, a living will reflecting your end-of-life wishes, as well as powers of attorney for health-care and financial matters.
• Appoint fiduciaries: To execute your estate plan, you must designate someone to act on your behalf if you are unable to do so as executor of your will, trustee for your assets, legal guardian for your dependents or personal representative or power of attorney if you became incapacitated. You need to be sure your fiduciaries are aware of and agree to their appointments, and that they know where to find your original estate planning documents. Fiduciaries can be family members, personal friends or hired professionals such as bankers, attorneys or corporate trustees. Whether you are just starting out or have accumulated wealth over a lifetime, an up-to-date estate plan helps you minimize the impact of unexpected events on you and your family by preserving, protecting and managing your assets. A financial advisor can help you create a financial security plan to meet your goals, and provide tools and resources to build an estate plan that makes an impact well into the future.

Free Consultation with an Estate Attorney

If you are here, you probably have an estate issue you need help with, call Ascent Law for your free estate law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506
Ascent Law LLC

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