Estate Planning FAQs
What is an estate?
An estate is all property owned by an individual, or in which the individual has some interest.
What is estate planning?
Estate planning is planning for the management and distribution of one’s estate during life while disabled and at death. Planning includes arranging property during a person’s lifetime for passage at death and attempting to minimize the impact and facilitate use during one’s remaining life. As such, estate planning can be a complex study covering many areas, including: wills, trusts, durable powers of attorney for asset management and health care, living wills, insurance, accounting, business continuation, and estate, inheritance, gift and income taxes.
What are some of the advantages of estate planning?
- You can maximize the distribution of your assets to your family and designated charity.
- You can plan so that you are assured that your family will have adequate support after your death.
- You can make sure you and your family will be provided for in an efficient manner if you become incapacitated.
- There may also be lifetime benefits to you, since a review of your assets could increase your efficiency in dealing with those assets during your lifetime.
- You can plan for the liquidity needed to pay your debts, taxes and administrative expenses.
How do I go about making my estate plan?
- Make a list of information concerning your family and others you wish to benefit, with ages and addresses, and a description of any special circumstances.
- Make a list of your assets, liabilities, insurance and pension/profit sharing plans, indicating how such assets are titled and indicating any beneficiary designation.
- Outline how you would like your estate distributed.
- Consult with your attorney, accountant, insurance agent and financial advisor.
What happens if a person dies without a Will?
State statutes provide a plan for distributing the property of individuals who die without a Will (intestate). Many people, however, want their estate to pass differently than the state’s statutory plan would provide. Examples:
- Do not want property to pass outright to children at the bare age of majority, age 19, but want the property to be managed for some period of time.
- May want a trust to prevent taxation of property in the surviving spouse’s estate.
- May want to make special disposition of or provisions for certain assets, such as a family-owned business and family memorabilia items.
- May want to designate who should administer the estate, who should care for minor children, and who should manage assets for the children to avoid conflicts between family members with equal priority.
- May want to make charitable gifts.
Where should a person keep a Will?
The original Will should be kept in a safe deposit box or fire-proof safe. The nominated Personal Representative or successor Personal Representative likely to survive should have access to it upon death. For example, for a bank safe deposit box another signatory should be designated who will have access to the box (not necessarily a co-owner), or the attorney may maintain a safe deposit box to hold original estate planning documents for clients. If the original will is needed for probate and cannot be found, at a minimum, complicated issues result that substantially increase the administrative cost to administer the estate, and the worst case scenario is that the will could be considered invalid, leaving an intestate estate. We cannot overemphasize the importance of having your nominated fiduciary locate the original documents upon death or disability.
What can’t a Will do?
- A Will cannot pass property that is owned in joint tenancy with right of survivorship; such property automatically passes to the surviving joint tenant by operation of law, and will ultimately pass in accordance with the last surviving joint tenant’s Will or by intestacy in the last surviving joint tenant’s estate.
- A Will cannot pass property that has a named beneficiary, such as life insurance, annuity, pension or profit-sharing plan, or an individual retirement account (IRA) unless the designated beneficiary is the estate of the person making the Will.
- The Will should not contain directions concerning the funeral or authorizing anatomical donations, because often the Will is not examined until after funeral arrangements have already been made and nearly always too late to make anatomical gifts.
Do I need a new Will if I move to another state?
All states will recognize a Will that has been validly executed while you were domiciled in another state. However, since each state’s statutes regarding Wills and probate are different, you should have a local attorney review your Will after moving to another state to see if any changes would be recommended under the law of the new state.
What is a Codicil?
A Codicil is an amendment to a Will. A Codicil is generally used if an amendment to a Will is not extensive and if the Testator does not object to persons seeing the old Will before the change. If more extensive changes are to be made to a Will, it is generally advisable to execute a new Will incorporating such changes.
What is probate?
Probate is the act or process of proving the validity of a Will. However, the term has been expanded in its general use to include the administration and distribution of a decedent’s assets according to the terms of the Will or in accordance with intestacy statutes, as well as determining the final debts and expenses which must be paid by a decedent’s estate.
What rights does a spouse have in the property of his/her deceased spouse?
If a married person domiciled in Nebraska dies, the surviving spouse has a right of election to take, in lieu of what he/she is entitled to under a Will, an elective share in any fraction, not in excess of one-half of the augmented estate of the decedent. Nebraska statutes set forth a detailed definition of what is included in the augmented estate so as to take into consideration property passing to the spouse or others prior to death by gift, and other such property not actually in the decedent’s estate. Spouses may give up the right to each other’s property by executing an agreement extinguishing such rights, either before or after marriage. The law of most states make some similar provision protecting the right of a surviving spouse to a portion of a decedent spouse’s estate even if the spouse is omitted from a decedent’s Will.