Estate Planning 9

What’s the Big Deal With Going Through Probate Court?

If you’ve taken a look around a few estate planning websites, you’ve likely heard claims of how detrimental or painstaking probate court is. In fact, one of the most common reasons for creating an estate plan is to avoid probate. Very few of those websites, however, take the time to explain exactly why probate should be avoided and how to ensure that your estate stays out of probate. That’s something we’re seeking to remedy today by clearing up some misconceptions about avoiding probate and detailing the benefits of doing so.

Why Should I Avoid Probate?

To start, the probate process usually consists of verifying the decedent’s will, appointing an executor to the will, and then following the process of determining which assets should be distributed to the beneficiaries after paying the decedent’s debts. Depending on the size of the estate, this process could take a lengthy period of time. With more time and complexity comes more expenses in handling the probate of the estate, and this reason alone is enough to convince most to do their best to avoid probate. 

Keeping an estate out of probate also means that your assets will not become part of the public record. This may or may not be a significant selling point for you, but to some with large estates, keeping the details of their assets away from the public eye is essential – leading them to undergo the effort of ensuring that their estate will not need to go through probate.

Avoiding Probate Can Be Difficult

How difficult it is for you to avoid probate depends heavily on the size and complexity of your estate, but for some, will be automatic. If the total value of an estate in Kentucky is less than $30,000, it will not enter into probate and instead will enter into an expedited process. For those who want to avoid probate entirely, a trust is often used to transfer assets out of the control of the owner, and into the control of the trust. Legally, the individual no longer owns those items, and so they won’t be included in the value of their estate.

Some items are considered non-probate property, and also won’t be included in the valuation of the estate. This mainly includes jointly-owned property which is passed onto a partner automatically upon the death of the other, such as shared houses or bank accounts. In order to avoid probate, every asset which is considered probate property is transferred into a trust, effectively leaving no items (or less than the minimum required for probate) to be distributed in your will. 

With this process, avoiding probate is possible; however, it can become difficult for some to stay on top of transferring every necessary asset into the trust. This method poses a significant risk, as the costs of upkeeping a trust could be for naught if not kept up to date. If enough property is left out of the trust, the estate will be forced into probate regardless, which means that we’ve effectively cost ourselves more money by paying both to upkeep the trust and for the probate process. 

If you’re seeking to avoid probate, you’ll need the most experienced estate planning attorneys around. Look no further than Kentucky Estate Planning Law Center. Our team approach means that we’re able to create a comprehensive plan that will work for you, and we offer ongoing updates to your estate documents, ensuring that your plan is never out of date. To get started with your own estate plan, contact us today

 

Power of attorney

Creating Effective Power of Attorney Documents

It’s an unfortunate reality that injuries and illnesses often come unexpectedly. When they do, power of attorney documents are useful tools to ensure that your wishes are followed, even if you’re unable to make those decisions yourself – but these documents can only be as effective as they’re written. As such, it’s important to work with an experienced attorney who knows these common pitfalls, and how to avoid them.

Planning is Primary

Your primary power of attorney, also known as your agent, will be the first to act on your behalf in the case that it is needed, and a successor agent may also be named to ensure that you always have an agent available. If the person elected in your primary (the “agent”) becomes sick, unable, or unwilling to fulfill their duties, your primary power of attorney will not be able to act on your behalf. Only the person named has the authority to act on it, and if they’re unable to do so, the privileges provided by the power of attorney document cannot be transferred to anyone else unless that person is named as a successor agent in the Power of Attorney. 

The person nominated should also sign the document. This way, we have a written acknowledgment of their duties and what your power of attorney entails, which holds them to the execution as it’s defined in the document. This is just another step in ensuring that your wishes are followed, and one which is often missed by estate planning attorneys, sometimes resulting in issues known as “trustee malfeasance”. 

Planning for Contingencies

Often, the deciding factor between an effective power of attorney document and one which is useless to your situation comes down to proper planning. For instance, Kentucky recently implemented new laws restricting how an agent may make gifts on behalf of the principal (the original owner of the estate). These restrictions prevent an agent from making any gifts from the assets of the principal without explicit permission to do so, and with the specificity of which assets they’re allowed to gift. This may cause problems in cases where distributions from the estate are necessary to pay for bills or to support the principal’s family while they’re incapacitated. Without an experienced estate planning attorney, these details could easily be missed.

We frequently see cases with issues stemming from a lack of proper power of attorney documents. These are just some of the many problems that stem from poor estate planning, all of which are avoidable with the expertise of the Kentucky Estate Planning Law Center. Contact us today to see what we can do for you.