MVP Law Group, P.A. makes available the information and materials in this forum for informational purposes only. The information is general in nature and does not constitute legal advice or any contractual obligations. Further, the use of this site, and the sending or receipt of this information, does not create an attorney-client relationship between us. And, therefore, your communication with us through this forum will not be considered as privileged or confidential.
Question #1 – Wills
Is it possible to leave my company or business to someone in my will?
Answer #1
Yes. You should have a provision in your will for your business and should also prepare the necessary Business Succession documents for transfer of your company/business to someone else.
Question #2 – Wills
When do changes to your will become inadmissible?
Answer #2
When a doctor has declared you incapacitated/incompetent; when you no longer understand the nature of your property; when you are no longer of sound mind, etc.
Question #3 – General
Who makes decisions on your behalf if you become incapacitated?
Answer #3
If you have made the necessary preparations prior to your incapacitation, whomever you listed to make those decisions. If you did not prepare for your incapacitation, then your family/friend may have to petition the Court to ultimately make decisions on your behalf.
Question #4 – POA
What is a financial power of attorney? Is it necessary to have one?
Answer #4
A power of attorney is a written instrument executed by one person, called the principal/grantor, which designates another person, called the agent/attorney-in-fact, to perform acts on the principal’s/grantor’s behalf. An executed POA allows your agent to make decisions on your behalf when you are unable to do so on your own.
Question #5 – General
How is joint tenancy different from tenancy by the entirety?
Answer #5
Joint tenancy is a type of ownership of real or personal property held by two or more persons in which each owns an undivided interest in the whole.
Tenancy by the entirety is a type of ownership of real property held by a Husband and Wife where each owns the undivided whole of the property, with the Right of Survivorship, so that upon the death of one, the survivor is entitled to the decedent's share.
Question #6 – General
How do you determine if an estate is taxable?
Answer #6
If your death occurs during a year when the federal estate tax is in effect, then whether your estate will be liable for federal estate taxes will depend on the value of your gross estate, the amount of debt you owe at the time of your death, the total expenses that will be incurred while settling your estate, and any deductions that your estate can take.
Question #7 – General
What is the tax rate for taxable estates?
Answer #7
The federal estate and gift tax rate for deaths in 2011 and 2012 is 35%.
Question #8 – Trusts
Does a living trust ever become public, like a will does when it goes to probate court?
Answer #8
No, a trust is not a public document.
Question #9 – Pour Over Will
If I have a living trust, why would I still need to create a will?
Answer #9
A trust document cannot necessarily cover all of your belongings. Accordingly, a pour over will would be recommended to handle all outstanding assets not covered in the trust.
Question #10 – General
Do all banks have the options to have an account Transfer on Death or make an account Payable on Death?
Answer #10
Yes, all banks should have the options.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Friday, March 9th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Monday, February 27, 2012
Monday, February 13, 2012
MVP LAW GROUP – Estate Planning Q&A Forum, Monday, February 13, 2012
MVP Law Group, P.A. makes available the information and materials in this forum for informational purposes only. The information is general in nature and does not constitute legal advice or any contractual obligations. Further, the use of this site, and the sending or receipt of this information, does not create an attorney-client relationship between us. And, therefore, your communication with us through this forum will not be considered as privileged or confidential.
Question #1 – General
Can I name anyone to become the beneficiaries of my retirement’s accounts?
Answer #1
Generally, yes; however, it does depend upon the type of Retirement account set up, as some restrict beneficiaries to spouses and children. You should carefully consider whom you are listing as a beneficiary, particularly their age and their ability to manage the assets.
Question #2 – General
What are the benefits of having an accounts set up with a “pay on death” for my beneficiaries?
Answer #2
The beneficiaries of those assets receive their share of the assets immediately, as they do not have to undergo the probate process.
Question #3 – General
What type of assets can be held in joint tenancy?
Answer #3
Joint tenancy is a type of ownership in which two or more people share an interest in personal property or real estate.
Question #4 –Wills
Can my 16 year old child be a beneficiary in my will?
Answer #4
Your 16 year old child may be a beneficiary in your will; however, you should have a guardian provision included in your will as well to hold the assets for your child if you die while your 16 year old is still a child. The guardian will hold the assets of your child until your child becomes emancipated under the law.
Question #5 – Wills
If my minor child cannot legally be a beneficiary and I would like to leave them something in my will, who has control over the items left to them until they are legally able to inherit them?
Answer #5
Please see answer to Question #4.
Question #6 – Wills
If I am terminally ill, at what point do admissions and changes to my will become invalid?
Answer #6
It depends. If someone is terminally ill, that does not declare them mentally incompetent so that they cannot make changes to their will. As long as you are over the age of 18, understand the provisions of the will, and understand the disposition of your property in your will, and have not been declared mentally incompetent, you can make changes to your will up until your death.
Question #7 – Advance Directive
What is the purpose of an advance directive?
Answer #7
The purpose of an Advance Directive is to have your health care wishes carried out in your best interest if you are unable to dictate how you want to be treated. The advance directive allows you to make decisions regarding types of treatments and also allows you to appoint a Health Care Agent to carry out your wishes in the event you are unable to do so.
Question #8 – Advance Directive
What is a “durable power of attorney for health care”? Does this role actually have to be fulfilled by my attorney?
Answer #8
In Maryland, we have one document entitled an Advance Directive which combines the medical directive and durable power of attorney for health care. You are allowed to designate a particular person as your power of attorney or ‘Health Care Agent’. Once designated as your health care agent, that person is able to carry out your wishes with regards to health care treatment in the event you are unable to do so.
Question #9 – Advance Directive
If I create an advance directive, will it still be valid if I move out of state?
Answer #9
It depends upon the particular requirements of another state.
Question #10 – Wills
Do I have to have a legal will?
Answer #10
You do not have to have a legal will. Disposing of property both personal and real is entirely optional. If you do not wish to create a will, any belongings both personal and real will be disposed of in accordance with the Intestacy Laws of the state where you lived when you died.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Friday, February 24th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Question #1 – General
Can I name anyone to become the beneficiaries of my retirement’s accounts?
Answer #1
Generally, yes; however, it does depend upon the type of Retirement account set up, as some restrict beneficiaries to spouses and children. You should carefully consider whom you are listing as a beneficiary, particularly their age and their ability to manage the assets.
Question #2 – General
What are the benefits of having an accounts set up with a “pay on death” for my beneficiaries?
Answer #2
The beneficiaries of those assets receive their share of the assets immediately, as they do not have to undergo the probate process.
Question #3 – General
What type of assets can be held in joint tenancy?
Answer #3
Joint tenancy is a type of ownership in which two or more people share an interest in personal property or real estate.
Question #4 –Wills
Can my 16 year old child be a beneficiary in my will?
Answer #4
Your 16 year old child may be a beneficiary in your will; however, you should have a guardian provision included in your will as well to hold the assets for your child if you die while your 16 year old is still a child. The guardian will hold the assets of your child until your child becomes emancipated under the law.
Question #5 – Wills
If my minor child cannot legally be a beneficiary and I would like to leave them something in my will, who has control over the items left to them until they are legally able to inherit them?
Answer #5
Please see answer to Question #4.
Question #6 – Wills
If I am terminally ill, at what point do admissions and changes to my will become invalid?
Answer #6
It depends. If someone is terminally ill, that does not declare them mentally incompetent so that they cannot make changes to their will. As long as you are over the age of 18, understand the provisions of the will, and understand the disposition of your property in your will, and have not been declared mentally incompetent, you can make changes to your will up until your death.
Question #7 – Advance Directive
What is the purpose of an advance directive?
Answer #7
The purpose of an Advance Directive is to have your health care wishes carried out in your best interest if you are unable to dictate how you want to be treated. The advance directive allows you to make decisions regarding types of treatments and also allows you to appoint a Health Care Agent to carry out your wishes in the event you are unable to do so.
Question #8 – Advance Directive
What is a “durable power of attorney for health care”? Does this role actually have to be fulfilled by my attorney?
Answer #8
In Maryland, we have one document entitled an Advance Directive which combines the medical directive and durable power of attorney for health care. You are allowed to designate a particular person as your power of attorney or ‘Health Care Agent’. Once designated as your health care agent, that person is able to carry out your wishes with regards to health care treatment in the event you are unable to do so.
Question #9 – Advance Directive
If I create an advance directive, will it still be valid if I move out of state?
Answer #9
It depends upon the particular requirements of another state.
Question #10 – Wills
Do I have to have a legal will?
Answer #10
You do not have to have a legal will. Disposing of property both personal and real is entirely optional. If you do not wish to create a will, any belongings both personal and real will be disposed of in accordance with the Intestacy Laws of the state where you lived when you died.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Friday, February 24th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Friday, January 27, 2012
MVP LAW GROUP – Estate Planning Q&A Forum, Friday, January 27, 2012
MVP Law Group, P.A. makes available the information and materials in this forum for informational purposes only. The information is general in nature and does not constitute legal advice or any contractual obligations. Further, the use of this site, and the sending or receipt of this information, does not create an attorney-client relationship between us. And, therefore, your communication with us through this forum will not be considered as privileged or confidential.
Question #1 – Probate
What is the probate process?
Answer #1
In short, Probate involves paperwork and court appearances by lawyers once an individual dies. Probate is the legal process of overseeing the estate of a deceased person by resolving all claims and distributing the deceased person's property in accordance with the valid will. The probate court decides the validity of a testator’s will.
Question #2 – Probate
Is life insurance subject to probate?
Answer #2
No, unless you name your estate as the beneficiary of the policy.
Question #3 – Wills
What is the youngest age at which I can set up a will?
Answer #3
In order to draft a will, the individual must be:
a)At least 18 years old;
b)Of sound mind;
c)Free from duress, coercion; and
d)Able to completely understand the property they own, its value, and who they wish to leave it to upon their death.
Question #4 –Advance Directive
Who should I give copies of my Advance Directive to?
Answer #4
You should provide copies of your Advance Directive to the following interested persons:
1.Designated health care agent;
2.Primary care physician;
3.Hospital or treatment center;
4.Therapist;
5.Any other doctors that you frequent (i.e., oncologist; cardiologist; gynecologist)
6.You may wish to keep a copy of the Advance Directive in your vehicle;
7.You may wish to keep a copy of the Advance Directive in your wallet/purse.
Question #5 – Probate
If I do not have any family, who closes my estate?
Answer #5
Your family does not have to close your estate. You may designate a close friend/colleague or someone that you trust to close your estate.
Question #6 – Probate
What is non-probate property?
Answer #6
Non-probate is property held as Joint Tenants/ or Tenants by the Entireties, or property transferred to a living trust, proceeds of a Life Insurance Policy, money in a pension plan, IRA, 401(k) plan, or other retirement plan, stocks and bonds held in beneficiary forms and money in a payable-on-death bank account.
Question #7 – Wills
What is the difference between a Grantor and a Testator?
Answer #7
A grantor is the title used for the individual who sets up a trust. A testator is the title used for the individual that has written and executed a Last Will and Testament.
Question #8 –Trusts
What is a trust?
Answer #8
A trust is a legal agreement that allows you (the trustor) to transfer property and assets for the benefit of someone else (the beneficiaries). Beneficiaries can be individuals, businesses, or charitable organizations. You place your assets under control of a trustee, an individual or organization that manages and distributes the assets as set out in a trust document specifying your wishes.
Question #9 – Trusts
I am interested in drafting a trust; however, I heard they are relatively complex?
Answer #9
There are roughly eight steps in the process of developing a valid trust document:
1. Decide what type of trust best suits your particular situation. You may already know what you are looking for, but if not, an experience lawyer will be able to help you determine which type of trust would satisfy your goals.
2. Decide what items to leave in the trust. Several types of property may be transferred to a Trust. The following types of property can be effectively transferred to a Trust:
a. Personal property
b. Automobiles
c. Real Estate (Real property)
d. Bank Accounts
e. Registered Stocks & Bonds
f. Life Insurance
g. Retirement Plans
3. Decide who will inherit your trust property.
4. Choose someone to be your successor trustee.
5. Choose someone to manage children's property (if applicable to your situation).
6. Prepare the trust and sign it in front of a notary.
7. Transfer title of property to yourself as trustee.
8. Store your trust document safely.
Question #10 – Wills
Can you cancel your own Will?
Answer #10
Yes, you may revoke your own will. You may revoke by: including a provision in a subsequent will which revokes any prior will, or by burning, canceling, tearing or obliterating your will and any copies of it.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Monday, February 13th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Question #1 – Probate
What is the probate process?
Answer #1
In short, Probate involves paperwork and court appearances by lawyers once an individual dies. Probate is the legal process of overseeing the estate of a deceased person by resolving all claims and distributing the deceased person's property in accordance with the valid will. The probate court decides the validity of a testator’s will.
Question #2 – Probate
Is life insurance subject to probate?
Answer #2
No, unless you name your estate as the beneficiary of the policy.
Question #3 – Wills
What is the youngest age at which I can set up a will?
Answer #3
In order to draft a will, the individual must be:
a)At least 18 years old;
b)Of sound mind;
c)Free from duress, coercion; and
d)Able to completely understand the property they own, its value, and who they wish to leave it to upon their death.
Question #4 –Advance Directive
Who should I give copies of my Advance Directive to?
Answer #4
You should provide copies of your Advance Directive to the following interested persons:
1.Designated health care agent;
2.Primary care physician;
3.Hospital or treatment center;
4.Therapist;
5.Any other doctors that you frequent (i.e., oncologist; cardiologist; gynecologist)
6.You may wish to keep a copy of the Advance Directive in your vehicle;
7.You may wish to keep a copy of the Advance Directive in your wallet/purse.
Question #5 – Probate
If I do not have any family, who closes my estate?
Answer #5
Your family does not have to close your estate. You may designate a close friend/colleague or someone that you trust to close your estate.
Question #6 – Probate
What is non-probate property?
Answer #6
Non-probate is property held as Joint Tenants/ or Tenants by the Entireties, or property transferred to a living trust, proceeds of a Life Insurance Policy, money in a pension plan, IRA, 401(k) plan, or other retirement plan, stocks and bonds held in beneficiary forms and money in a payable-on-death bank account.
Question #7 – Wills
What is the difference between a Grantor and a Testator?
Answer #7
A grantor is the title used for the individual who sets up a trust. A testator is the title used for the individual that has written and executed a Last Will and Testament.
Question #8 –Trusts
What is a trust?
Answer #8
A trust is a legal agreement that allows you (the trustor) to transfer property and assets for the benefit of someone else (the beneficiaries). Beneficiaries can be individuals, businesses, or charitable organizations. You place your assets under control of a trustee, an individual or organization that manages and distributes the assets as set out in a trust document specifying your wishes.
Question #9 – Trusts
I am interested in drafting a trust; however, I heard they are relatively complex?
Answer #9
There are roughly eight steps in the process of developing a valid trust document:
1. Decide what type of trust best suits your particular situation. You may already know what you are looking for, but if not, an experience lawyer will be able to help you determine which type of trust would satisfy your goals.
2. Decide what items to leave in the trust. Several types of property may be transferred to a Trust. The following types of property can be effectively transferred to a Trust:
a. Personal property
b. Automobiles
c. Real Estate (Real property)
d. Bank Accounts
e. Registered Stocks & Bonds
f. Life Insurance
g. Retirement Plans
3. Decide who will inherit your trust property.
4. Choose someone to be your successor trustee.
5. Choose someone to manage children's property (if applicable to your situation).
6. Prepare the trust and sign it in front of a notary.
7. Transfer title of property to yourself as trustee.
8. Store your trust document safely.
Question #10 – Wills
Can you cancel your own Will?
Answer #10
Yes, you may revoke your own will. You may revoke by: including a provision in a subsequent will which revokes any prior will, or by burning, canceling, tearing or obliterating your will and any copies of it.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Monday, February 13th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Tuesday, January 24, 2012
Next Estate Planning Q&A Forum - Friday, January 27, 2012
MVP Law Group is excited to announce the launch of our “Estate Planning Q & A Forum.” Every other Friday, we will post the 10 most frequently asked questions received during the week from our Facebook/Twitter followers and website visitors. We will answer those questions on our Estate Planning Blog.
Our next “Q & A Forum” will take place Friday, January 27th, 2012. Act now and submit your questions!
Our next “Q & A Forum” will take place Friday, January 27th, 2012. Act now and submit your questions!
Friday, January 13, 2012
MVP LAW GROUP – Estate Planning Q&A Forum, Friday, January 13, 2012
MVP Law Group, P.A. makes available the information and materials in this forum for informational purposes only. The information is general in nature and does not constitute legal advice or any contractual obligations. Further, the use of this site, and the sending or receipt of this information, does not create an attorney-client relationship between us. And, therefore, your communication with us through this forum will not be considered as privileged or confidential.
Question #1 – Health Care Proxy
What does it mean to have a health care proxy? Does it cost any money to obtain one?
Answer #1
A Health Care Proxy is a document that allows a patient to appoint an agent to make health care decisions on the patient’s behalf in the event that the patient is incapable of making such decisions. Once the document is drafted, the patient continues to be allowed to make health care decisions as long as they are still competent to do so. In Maryland, we use a document called an Advance Directive which lays out your health care wishes in the event you are unable to communicate them and appoints an agent to make health care decisions on your behalf.
You can request that an Attorney draft an Advance Directive on your behalf OR you can download an advance directive off of the Maryland Office of the Attorney General website.
Question #2 – Life Insurance
How should I decide how much life insurance to purchase?
Answer #2
There are several considerations: how much will it take to meet your family’s needs; how long your family will need the monetary support; and if any family members suffer from chronic health issues or disabilities. We recommend that you speak with an experienced Professional in the Life Insurance business.
Question #3 – Trusts
What are Qualified Terminable Interest Property (QTIP) Trust and Qualified Personal Residence Trust (QPRT) and how does one qualify for these types of trusts?
Answer #3
A QTIP is the most common type of marital trust. A QTIP allows the grantor to provide for a surviving spouse and maintain control of how the trust's assets are distributed once the surviving spouse has died. It has two principal requirements, namely that the spouse have a “qualifying income interest for life,” and that the decedent’s personal representative elect to treat this type of trust as qualifying for the marital deduction on the death of the first to die. IRC §2056(b)(7).
A QPRT is an irrevocable trust created by the Grantor for the Grantor’s benefit. The Grantor funds the trust by transferring a primary or secondary residence into the trust retaining the continued right to use the residence for the term of the trust. The Grantor must select a term of years that the trust will exist. After the trust ends, the residence will pass to the named trust beneficiaries. The QPRT is a tax strategy for the wealthy.
Question #4 – Will
What type of stuff does a will not cover?
Answer #4
A will cannot cover property held as Joint Tenants/ or Tenants by the Entireties, or property transferred to a living trust. A will cannot cover proceeds of a Life Insurance Policy, money in a pension plan, IRA, 401(k) plan, or other retirement plan. However, you may on your own change the name of the beneficiary on the forms provided by the insurance agency, financial institution, etc. A will cannot cover stocks and bonds held in beneficiary forms. Additionally, a will cannot cover money in a payable-on-death bank account, as a simple form can be obtained from your bank to change the beneficiary listed.
Question #5 – Life Insurance
What is the difference between term and whole-life insurance?
Answer #5
Term life insurance is life insurance which provides coverage at a fixed rate of payments for a limited period of time.. After that period expires coverage at the previous rate of premiums is no longer guaranteed and the applicant must either forgo coverage or potentially obtain further coverage with different payments and/or conditions. If the insured dies during the term, the death benefit will be paid to the beneficiary. Term insurance is the least expensive way to purchase a substantial death benefit on a coverage amount per premium dollar basis over a specific period of time.
Whole life insurance is life insurance that remains in force for the insured's whole life and requires (in most cases) premiums to be paid every year into the policy.
We recommend that you speak with an experienced Professional in the Life Insurance business.
Question #6 – Will
If I leave my children out of my will, does that automatically disinherit them?
Answer #6
No; however, you are allowed to disinherit your children. When you disinherit a child you must make sure to mention them by name in the will and say that they should receive nothing; otherwise, there is still potential for them to take something.
Question #7 – Will
At what age should I meet with a lawyer to start planning my will?
Answer #7
It does not necessarily depend upon age, but upon life circumstances. We recommend that when circumstances change you plan for it accordingly in your will. Such as the following situations: marriage; divorce; birth; death; acquiring of a business; dissolution of a business; etc.
Question #8 –Will
Do I need to hire a lawyer to make a legal and binding will?
Answer #8
No. There are many self-help kits on the internet that allow individuals to prepare and plan their own wills; however, certain situations may require the expertise of a licensed professional who has experience in the estate planning process. Additionally, different states have differing requirements in order to make a will valid under the law. It is always better to have the assistance of an experienced attorney to guide you through the challenging process.
Question #9 – Probate
Does the executor of my estate have to be my lawyer?
Answer #9
No; however, the executor of your estate should be someone whom you trust.
Question #10 – Will
Can a will be changed after the person that created it has passed away?
Answer #10
No.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Friday, January 27th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Question #1 – Health Care Proxy
What does it mean to have a health care proxy? Does it cost any money to obtain one?
Answer #1
A Health Care Proxy is a document that allows a patient to appoint an agent to make health care decisions on the patient’s behalf in the event that the patient is incapable of making such decisions. Once the document is drafted, the patient continues to be allowed to make health care decisions as long as they are still competent to do so. In Maryland, we use a document called an Advance Directive which lays out your health care wishes in the event you are unable to communicate them and appoints an agent to make health care decisions on your behalf.
You can request that an Attorney draft an Advance Directive on your behalf OR you can download an advance directive off of the Maryland Office of the Attorney General website.
Question #2 – Life Insurance
How should I decide how much life insurance to purchase?
Answer #2
There are several considerations: how much will it take to meet your family’s needs; how long your family will need the monetary support; and if any family members suffer from chronic health issues or disabilities. We recommend that you speak with an experienced Professional in the Life Insurance business.
Question #3 – Trusts
What are Qualified Terminable Interest Property (QTIP) Trust and Qualified Personal Residence Trust (QPRT) and how does one qualify for these types of trusts?
Answer #3
A QTIP is the most common type of marital trust. A QTIP allows the grantor to provide for a surviving spouse and maintain control of how the trust's assets are distributed once the surviving spouse has died. It has two principal requirements, namely that the spouse have a “qualifying income interest for life,” and that the decedent’s personal representative elect to treat this type of trust as qualifying for the marital deduction on the death of the first to die. IRC §2056(b)(7).
A QPRT is an irrevocable trust created by the Grantor for the Grantor’s benefit. The Grantor funds the trust by transferring a primary or secondary residence into the trust retaining the continued right to use the residence for the term of the trust. The Grantor must select a term of years that the trust will exist. After the trust ends, the residence will pass to the named trust beneficiaries. The QPRT is a tax strategy for the wealthy.
Question #4 – Will
What type of stuff does a will not cover?
Answer #4
A will cannot cover property held as Joint Tenants/ or Tenants by the Entireties, or property transferred to a living trust. A will cannot cover proceeds of a Life Insurance Policy, money in a pension plan, IRA, 401(k) plan, or other retirement plan. However, you may on your own change the name of the beneficiary on the forms provided by the insurance agency, financial institution, etc. A will cannot cover stocks and bonds held in beneficiary forms. Additionally, a will cannot cover money in a payable-on-death bank account, as a simple form can be obtained from your bank to change the beneficiary listed.
Question #5 – Life Insurance
What is the difference between term and whole-life insurance?
Answer #5
Term life insurance is life insurance which provides coverage at a fixed rate of payments for a limited period of time.. After that period expires coverage at the previous rate of premiums is no longer guaranteed and the applicant must either forgo coverage or potentially obtain further coverage with different payments and/or conditions. If the insured dies during the term, the death benefit will be paid to the beneficiary. Term insurance is the least expensive way to purchase a substantial death benefit on a coverage amount per premium dollar basis over a specific period of time.
Whole life insurance is life insurance that remains in force for the insured's whole life and requires (in most cases) premiums to be paid every year into the policy.
We recommend that you speak with an experienced Professional in the Life Insurance business.
Question #6 – Will
If I leave my children out of my will, does that automatically disinherit them?
Answer #6
No; however, you are allowed to disinherit your children. When you disinherit a child you must make sure to mention them by name in the will and say that they should receive nothing; otherwise, there is still potential for them to take something.
Question #7 – Will
At what age should I meet with a lawyer to start planning my will?
Answer #7
It does not necessarily depend upon age, but upon life circumstances. We recommend that when circumstances change you plan for it accordingly in your will. Such as the following situations: marriage; divorce; birth; death; acquiring of a business; dissolution of a business; etc.
Question #8 –Will
Do I need to hire a lawyer to make a legal and binding will?
Answer #8
No. There are many self-help kits on the internet that allow individuals to prepare and plan their own wills; however, certain situations may require the expertise of a licensed professional who has experience in the estate planning process. Additionally, different states have differing requirements in order to make a will valid under the law. It is always better to have the assistance of an experienced attorney to guide you through the challenging process.
Question #9 – Probate
Does the executor of my estate have to be my lawyer?
Answer #9
No; however, the executor of your estate should be someone whom you trust.
Question #10 – Will
Can a will be changed after the person that created it has passed away?
Answer #10
No.
MVP Law Group would like to thank everyone who contributed a question or comment.
Our next “Estate Planning Q & A Forum” is scheduled for Friday, January 27th, 2012!
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Wednesday, November 23, 2011
Next Estate Planning Q&A Forum - Friday, January 13, 2012
MVP Law Group is excited to announce the launch of our “Estate Planning Q & A Forum.” Every other Friday, we will post the 10 most frequently asked questions received during the week from our Facebook/Twitter followers and website visitors. We will answer those questions on our Estate Planning Blog.
Our next “Q & A Forum” will take place Friday, January 13th, 2012. Act now and submit your questions!
Our next “Q & A Forum” will take place Friday, January 13th, 2012. Act now and submit your questions!
Monday, November 7, 2011
MVP LAW GROUP – Estate Planning Q&A Forum, Friday, November 4, 2011
MVP Law Group, P.A. makes available the information and materials in this forum for informational purposes only. The information is general in nature and does not constitute legal advice or any contractual obligations. Further, the use of this site, and the sending or receipt of this information, does not create an attorney-client relationship between us. And, therefore, your communication with us through this forum will not be considered as privileged or confidential.
Question #1 – General
What's the difference between an inheritance tax and an estate tax?
Answer #1
The inheritance tax is imposed on the clear value of property that passes from a decedent to some beneficiaries. The tax is levied on property that passes under a will, the intestate laws of succession, and property that passes under a trust, deed, joint ownership, or otherwise. The tax is collected by the Register of Wills located in the county where the decedent either lived or owned property. Property passing to a child or other lineal descendant, spouse of a child or other lineal descendant, spouse, parent, grandparent, stepchild or stepparent, siblings or a corporation having only certain of these persons as stockholders is exempt from taxation, all other individuals are taxed at a rate of 10%.
The Maryland estate tax is a state tax imposed on the transfer of property in a decedent's estate. Accordingly, an estate tax return is required for every estate whose federal gross estate equals or exceeds $1,000,000. Therefore, if your federal gross estate does not equal or exceed $1M, you do not have to worry about the Maryland estate tax. The tax rate is limited to 16% of the amount that the estate value exceeds $1,000,000.
Question #2 – Trusts
What does it mean to have a living trust and why is it important?
Answer #2
A living trust, also called an inter vivos trust, is a trust which is effective during the lifetime of the person who created the trust. The person who created the living trust, the creator (grantor), may change the terms of the living trust during his/her lifetime. A living trust typically contains instructions for managing trust assets during the creator's lifetime as well as instructions for distributing trust assets upon the creator's/grantor’s incapacity or death, thereby eliminating the need for conservatorship or probate proceedings.
Question #3 – Wills
If my children are under 18, still legal minors, can they inherit anything that I leave them?
Answer #3
The Maryland Uniform Transfers to Minors Act (MUTTMA) allows the donor of the gift to transfer title to a custodian who will manage and invest the property until the minor reaches the age of 21.
Question #4 – Advance Directive/Living Will
Does power of attorney medical care mean that only my attorney can make decisions regarding my health?
Answer #4
The term ‘power of attorney’ is a term of art; it does not mean that your attorney may make decisions regarding your health. You may in fact appoint your attorney to serve as your health care agent; however, anyone whom you trust may serve as your health care power of attorney and/or financial power of attorney.
A power of attorney is a document that allows you to appoint a person or organization to handle your affairs while you're unavailable or unable to do so. The person or organization you appoint is referred to as an "Attorney-in-Fact" or "Agent.
Question #5 – Trusts
If I create and irrevocable trust and later decided that I need to amend it, is there really nothing that can be done to change it?
Answer #5
An irrevocable trust is a trust that cannot be modified or terminated without the permission of the beneficiary. The creator/grantor, having transferred assets into the trust, effectively removes all of his or her rights of ownership to the assets and the trust. This is the opposite of a "revocable trust", which allows the creator/grantor to modify the trust.
Question #6 –Wills
What is probate?
Answer #6
The Office of the Register of Wills for the State of Maryland provides the following:
The literal interpretation means to prove, as in proving one's will. It can be done administratively in the Register of Wills Office or judicially by the Orphans' Court when necessary. It is the marshalling of assets, the payment of all creditors and the transference of all property in the decedent's name to the beneficiaries either named in the will or who would inherit under the laws of intestacy (dying without a will).
Question #7 – Wills
What property is included in an individual's probate estate?
Answer #7
An individual’s probate estate includes only property subject to estate administration after the death of the individual. Examples of probate property are houses, cars, furniture, stocks, bonds, and bank accounts titled in an individual’s name. Examples of property not typically included an individual’s probate estate are assets which pass pursuant to a beneficiary designation form such as life insurance policies, annuities, and certain retirement accounts, or assets held jointly with others with rights of survivorship, or assets titled in the name of the deceased individual's trust.
Question #8 – General
What is a conservatorship?
Answer #8
A conservatorship is a court procedure where a Judge declares an individual unable to take care of his/her own legal matters and appoints another individual, known as a conservator, to do so.
Question #9 – Trusts
In what ways can I protect my child who has special needs in case of my death? Is there anything special that I need to do?
Answer #9
You could create a Special Needs Trust. A special needs trust is created to ensure that beneficiaries who are disabled or mentally ill can enjoy the use of property which is intended to be held for their benefit. In addition to personal planning reasons for such a trust (the person may lack the mental capacity to handle their financial affairs) there may be fiscal advantages to the use of a trust. Such trusts may also avoid beneficiaries losing access to essential government benefits. A common feature of trusts is that they may be run either by family members (a private trust) or by trustees appointed by the court. Especially where a trust is to be established for a disabled child or young person, great care is generally taken in the choice of appropriate trustees to manage the trust assets and to deal with future replacement appointments.
Question #10 – General
What is estate tax and how does it affect me?
Answer #10
The Maryland estate tax is a state tax imposed on the transfer of property in a decedent's estate. Accordingly, an estate tax return is required for every estate whose federal gross estate equals or exceeds $1,000,000. Therefore, if your federal gross estate does not equal or exceed $1M, you do not have to worry about the Maryland estate tax.
MVP Law Group would like to thank everyone who contributed a question or comment.
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
Question #1 – General
What's the difference between an inheritance tax and an estate tax?
Answer #1
The inheritance tax is imposed on the clear value of property that passes from a decedent to some beneficiaries. The tax is levied on property that passes under a will, the intestate laws of succession, and property that passes under a trust, deed, joint ownership, or otherwise. The tax is collected by the Register of Wills located in the county where the decedent either lived or owned property. Property passing to a child or other lineal descendant, spouse of a child or other lineal descendant, spouse, parent, grandparent, stepchild or stepparent, siblings or a corporation having only certain of these persons as stockholders is exempt from taxation, all other individuals are taxed at a rate of 10%.
The Maryland estate tax is a state tax imposed on the transfer of property in a decedent's estate. Accordingly, an estate tax return is required for every estate whose federal gross estate equals or exceeds $1,000,000. Therefore, if your federal gross estate does not equal or exceed $1M, you do not have to worry about the Maryland estate tax. The tax rate is limited to 16% of the amount that the estate value exceeds $1,000,000.
Question #2 – Trusts
What does it mean to have a living trust and why is it important?
Answer #2
A living trust, also called an inter vivos trust, is a trust which is effective during the lifetime of the person who created the trust. The person who created the living trust, the creator (grantor), may change the terms of the living trust during his/her lifetime. A living trust typically contains instructions for managing trust assets during the creator's lifetime as well as instructions for distributing trust assets upon the creator's/grantor’s incapacity or death, thereby eliminating the need for conservatorship or probate proceedings.
Question #3 – Wills
If my children are under 18, still legal minors, can they inherit anything that I leave them?
Answer #3
The Maryland Uniform Transfers to Minors Act (MUTTMA) allows the donor of the gift to transfer title to a custodian who will manage and invest the property until the minor reaches the age of 21.
Question #4 – Advance Directive/Living Will
Does power of attorney medical care mean that only my attorney can make decisions regarding my health?
Answer #4
The term ‘power of attorney’ is a term of art; it does not mean that your attorney may make decisions regarding your health. You may in fact appoint your attorney to serve as your health care agent; however, anyone whom you trust may serve as your health care power of attorney and/or financial power of attorney.
A power of attorney is a document that allows you to appoint a person or organization to handle your affairs while you're unavailable or unable to do so. The person or organization you appoint is referred to as an "Attorney-in-Fact" or "Agent.
Question #5 – Trusts
If I create and irrevocable trust and later decided that I need to amend it, is there really nothing that can be done to change it?
Answer #5
An irrevocable trust is a trust that cannot be modified or terminated without the permission of the beneficiary. The creator/grantor, having transferred assets into the trust, effectively removes all of his or her rights of ownership to the assets and the trust. This is the opposite of a "revocable trust", which allows the creator/grantor to modify the trust.
Question #6 –Wills
What is probate?
Answer #6
The Office of the Register of Wills for the State of Maryland provides the following:
The literal interpretation means to prove, as in proving one's will. It can be done administratively in the Register of Wills Office or judicially by the Orphans' Court when necessary. It is the marshalling of assets, the payment of all creditors and the transference of all property in the decedent's name to the beneficiaries either named in the will or who would inherit under the laws of intestacy (dying without a will).
Question #7 – Wills
What property is included in an individual's probate estate?
Answer #7
An individual’s probate estate includes only property subject to estate administration after the death of the individual. Examples of probate property are houses, cars, furniture, stocks, bonds, and bank accounts titled in an individual’s name. Examples of property not typically included an individual’s probate estate are assets which pass pursuant to a beneficiary designation form such as life insurance policies, annuities, and certain retirement accounts, or assets held jointly with others with rights of survivorship, or assets titled in the name of the deceased individual's trust.
Question #8 – General
What is a conservatorship?
Answer #8
A conservatorship is a court procedure where a Judge declares an individual unable to take care of his/her own legal matters and appoints another individual, known as a conservator, to do so.
Question #9 – Trusts
In what ways can I protect my child who has special needs in case of my death? Is there anything special that I need to do?
Answer #9
You could create a Special Needs Trust. A special needs trust is created to ensure that beneficiaries who are disabled or mentally ill can enjoy the use of property which is intended to be held for their benefit. In addition to personal planning reasons for such a trust (the person may lack the mental capacity to handle their financial affairs) there may be fiscal advantages to the use of a trust. Such trusts may also avoid beneficiaries losing access to essential government benefits. A common feature of trusts is that they may be run either by family members (a private trust) or by trustees appointed by the court. Especially where a trust is to be established for a disabled child or young person, great care is generally taken in the choice of appropriate trustees to manage the trust assets and to deal with future replacement appointments.
Question #10 – General
What is estate tax and how does it affect me?
Answer #10
The Maryland estate tax is a state tax imposed on the transfer of property in a decedent's estate. Accordingly, an estate tax return is required for every estate whose federal gross estate equals or exceeds $1,000,000. Therefore, if your federal gross estate does not equal or exceed $1M, you do not have to worry about the Maryland estate tax.
MVP Law Group would like to thank everyone who contributed a question or comment.
Please remember to submit your questions/comments on our Website, Facebook or Twitter.
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