Estate planning is the process of reviewing your assets and planning for the future, a future that could include a short term or long term incapacity, or a time when you are no longer living. You want to make sure your assets pass to your loved ones at your death, while minimizing expenses, estate taxes, and hassle for your loved ones.
Estate planning can be challenging because it requires you to picture a time when you are either incapacitated or deceased and make current decisions about what would happen at that future time.
The Trust and Estate Team at Poole Brooke Plumlee PC takes a client-centered approach to assisting our estate planning clients in crafting a comprehensive estate plan that takes care of their family and secures the future of their loved ones, while preserving wealth and simplifying the transfer of assets at death. Our team begins the process by finding out what is important to you:
- What are your goals and concerns regarding your assets and your family?
- What are your wishes regarding your assets and your care if you become incapacitated?
- Who are the people in your life that you want to assist you if you become incapacitated, or that you trust to manage assets at your death?
In Virginia, state law will distribute your property for you if you die without a will, but most of our clients prefer to make their own decisions about their estate:
- Who will administer and manage your estate (executor)?
- Who are your beneficiaries and what will they receive?
- Who would you prefer to raise your children if you and their other parent die while they are still minors?
A properly drafted and executed Will can save your Estate money by reducing legal fees later to correct errors or omissions inherent in hand written Wills and simplify administration. By creating a Will and keeping it up-to-date, you can prevent headaches for your family after your death.
Revocable trusts (sometimes referred to as living trusts) give you the ability to manage your property while you are still alive and make the transition to a successor trustee much easier in the event that you become unable to manage your affairs. Because the Trust can continue to own assets after your death, there is even the opportunity to control the disposition of your assets after your death if you elect that option. Although they do not protect assets from creditors of the person who created the trust, revocable trusts are recommended for:
- Avoiding Probate: Probate apples only to the property you own in your individual name, so anything transferred into a revocable trust is exempt from the probate process, reducing expenses at your death.
- Disability Planning: A successor trustee can be appointed to manage trust property in the event that you become incapacitated. This avoids the expense and court involvement required to appoint a Guardian and Conservator for you if you become unable to manage your personal affairs.
An experienced attorney at Poole Brooke Plumlee PC will explain how each type of trust may benefit you and guide you through this aspect of the estate planning process. In some cases, you may want to explore related options, such as life insurance trusts and charitable trusts.
Once an irrevocable trust is signed, it cannot be revoked without the consent of all the named beneficiaries or possibly a court order. Irrevocable trusts require you to give up control of your assets in order to achieve certain objectives. These benefits include:
- Asset Protection: Assets placed in a trust can be protected from a beneficiary’s creditors. Virginia law also allows Domestic Asset Protection Trusts or self-settled asset protection trusts, whereby the settler or creator can receive spendthrift protection from the settlor’s creditors.
- Estate Tax Reduction: If property is transferred to a properly drafted irrevocable trust, it may not be included in your taxable estate at your death. This makes irrevocable trusts a great planning tool for obtaining the most efficient use of your estate and gift tax exemption.
- Access to Benefits: If planning for Medicaid qualification for nursing home costs or a special needs child, an irrevocable trust can be a valuable tool to hold assets in a manner that will not adversely affect qualification, subject to the applicable look back period.
An estate planning lawyer at our firm can help you determine which living trust option is most compatible with your estate planning goals and create a trust document accordingly.
Advance Directives/Health Care Power of Attorneys
Advance medical directives, which are authorized under the Virginia Health Care Decisions Act, allow you to state your medical care wishes if you are unable to make decisions on your own. For example, you may:
- Direct the provision of a specific procedure or treatment, such as artificial hydration (fluids) or nutrition (feeding)
- Request the withholding of a specific procedure or treatment
- Assign a person to act as your agent in making health care decisions for you if it is determined that you cannot make them for yourself, including end-of-life decisions.
If you do not have an advance directive, the hospital, your family, and your doctor will decide whether or not to withdraw your treatment. It may be necessary for a court to resolve the conflict if these parties cannot come to an agreement
Power of Attorney
Powers of attorney (POAs) authorize one person to act on behalf of another in matters involving their personal and financial assets. There are several different types of POAs in Virginia, each one intended to fulfill a specific need.
A Power of Attorney can be Durable or Springing.
- Durable Power of Attorney: This type of power of attorney generally remains in effect even if you become incapacitated, for example, due to illness or an accident.
- Springing Power of Attorney: A power of attorney normally takes effect immediately after signing, unless it contains language that states it will not take effect until a specific action occurs (for example, if you become incapacitated in the future). This is called a springing power of attorney. Although allowed by Virginia law, they are difficult to use practically because of third party concerns as to the determination of incapacity and we do not recommend them.
A Power of Attorney can be General or Limited.
- General Power of Attorney: A general power of attorney gives the agent broad authority to do almost anything on your behalf with regard to your financial and legal assets.
- Limited Power of Attorney: With a limited power of attorney, the agent is only authorized to act on certain matters that you specify, such as a real estate transaction, or the operation of a business.
Q: What Happens if I Die Without a Will in Virginia?
A: If you die without a will, your assets will be distributed according to Virginia’s laws of intestate succession. If you are married and don’t have children or only have children with your spouse, your spouse gets everything. If you have a spouse and also children that are not your spouse’s children, one-third of your assets go to your spouse and the remaining two-thirds are divided between your children. If you are single, your assets go to your parents, if they are living, or to your siblings if they are not. There are other laws that apply when a person dies without a spouse, children, or parents.
As you can imagine, dying intestate means that your estate may be distributed in ways you never wanted. If you have minor children and their other parent is deceased, the court may appoint a guardian who wouldn’t have been your first choice. Visiting a Virginia estate planning lawyer to create a simple will can prevent unpleasant outcomes and provide you with peace of mind.
Q: Does a Power of Attorney Expire?
A: Powers of attorney created in Virginia under the Uniform Power of Attorneys Act are automatically durable unless otherwise specified. While this can be reassuring, life changes at a rapid pace and one day your arrangement may no longer be appropriate for your current situation.
We recommend that our clients meet with an attorney every three to five years to review their documents, to discuss whether your choice of agent still meets your needs and to learn whether developments in state law may affect your current power of attorney. Some powers of attorney include explicit termination dates to minimize the risk of ex-spouses or former friends continuing to serve as agents, so you want to make sure that the arrangement continues under the terms you need.
Q: How Can Your Firm Help Me With My Estate Plan?
A: Poole Brooke Plumlee PC combines the clear guidelines of the law with the flexibility needed to accommodate changing client circumstances. We strive to design estate planning documents that are simple enough to be implemented effectively, but complex enough to address tax efficiencies, family circumstances, goals, and the reasonably foreseeable complications of life.
With our primarily “fixed fee” estate planning services, our clients receive the comfort of knowing exactly how much their plan will cost, along with an understanding gained from the attorney guided review process.
Whether your concerns relate to assets, businesses, family arrangements, potential tax responsibilities, religious beliefs, language barriers, foreign assets or beneficiaries, or any other factors, our attorneys use their experience serving our diverse region to help you achieve your goals.
Talk to a Virginia Estate Planning Lawyer Today
Planning for a future you will never see is emotionally difficult, but it is a necessary step to ensure that your property goes to your intended beneficiaries and that they have a reduced financial and administrative burden. The team at Poole Brooke Plumlee PC will help you create an estate plan that fits your present needs and can modify them with you as your situation changes. To schedule a consultation, please contact Poole Brooke Plumlee PC today, either via phone or our contact form.