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If I am creating a Trust, why do I still need a Will?

Written by Rosmary Bartsch on June 4, 2011 · Leave a Comment

A Living Trust package comes with a number of other documents, one of them being a Pourover Will.

What a pourover will does is catch any asset that you either forgot to put into your trust or you acquired after you created your trust and did not have time to put into the trust before you died and pours it into the trust (hence the term Pourover Will). Hopefully, the pourover will is never needed, because everything was properly put into your trust, but it is good to know that your estate is covered just in case.

An estate plan is just not complete without a General Durable Power of Attorney, Advance Health Care Directive and Pourover Will.

Categories: Trust Administration

What should I have in my Estate Planning binder?

Written by Rosmary Bartsch on March 17, 2011 · Leave a Comment

When I am asked to review someone’s estate plan, I start with their package (which can be a binder or stuffed envelope full of paper). Hopefully, I find all the appropriate estate planning documents; Trust, Assignment of Assets, Certification of Trust, Community Property Agreement (if married), Pourover Wills, General Durable Power of Attorney (finances), and Advance Health Care Directive. However, there are other important documents that should be in the binder, such as; real property transfers to the trust, trust asset list and copies of beneficiary designations. This is also a great place to put a list of family members and contact information, as well as, specific gifts of small personal items not listed in your trust.

There are more, but this is a good start and would be very helpful when reviewing your plan or for use by your successor Trustee.

Categories: Estate Planning

What is an Advance Health Care Directive? … And when is it used?

Written by Rosmary Bartsch on October 2, 2010 · Leave a Comment

What the GDPA does for your assets, the Advance Health Care Directive (AHCD) does for your person.

It authorizes someone (your agent) to make health decisions for you when you cannot due to incapacity.

The document contains instructions and wishes that you have directed that the agent follow. An example of this is that you may wish all artificial respiration, feeding and other items that would keep you alive to be shut down if it were determined that you are in a persistent vegetative state. A lot of complicated language that means shut off all the tubes that keep me alive if I am a vegetable (permanently, that is).

As we age, we all run the risk of dementia and Alzheimer’s and this document names the person that you would want to be in charge of your person. They would decide where you would live and of course make health care decisions for you.

Categories: Advance Health Care Directive

What is a General Durable Power of Attorney? … And when is it used?

Written by Rosmary Bartsch on September 3, 2010 · Leave a Comment

A general durable power of attorney or GDPA is a document that allows the person named (Attorney-in-Fact) to deal with accounts in the principal’s name.

The principal is the person who creates the GDPA. It also allows the Attorney-in-Fact (AIF) to act in the principal’s capacity when the principal cannot. For example, the AIF could sue a doctor for malpractice if the doctor injured the principal and the principal is now incapacitated and can’t sue for him or herself.

If you create a Living Trust and a GDPA then the Trustee will act over all assets in the trust but the AIF would act over assets that cannot be in the trust (your IRA for example). If you have put your assets into your trust and never become incapacitated, it is possible that your GDPA would never have to be used. It is one of those just-in-case documents that can save a lot of expense (Court) and headaches (Court) and money (Court). Without a GDPA, a representative of your estate would have to file a Conservatorship to deal with the assets not in your trust.

Categories: General Durable Power of Attorney

Why is your ‘Schedule A’ like a safety net?

Written by Rosmary Bartsch on July 27, 2010 · Leave a Comment

You signed your trust, listed all of your assets on the trust ‘Schedule A’, but for some reason were unable to fund the trust or a title change effort failed, how can the ‘Schedule A’ save the day?

Although not a substitute for proper funding, the Schedule A may be your safety net. An attorney may petition the Court asking that an item on Schedule A or even all the assets on that Schedule be ordered into the trust without a lengthy probate process. This is called a Heggstad petition named for the first person trying this technique and is now rather standard. It is not free to fund the trust this way, but is far less expensive and time consuming than a probate.

Why would a Heggstad be necessary?

Suppose you sign your trust shortly before a vacation with plans to fund it on your return, but you pass away on your trip.
Perhaps you instructed your broker to change title on your account, but one of the assets listed on the statement required additional steps that were not taken.
Another very common circumstance is refinancing real property, your home or rental property. The mortgage company required you to take the property out of your trust, or perhaps the escrow company did this, but upon completion of the refinance they did not return the property to the trust nor remind you to do so.

Given the importance of this safety net, it is a good idea to update your Schedule A periodically. A good time to update your Schedule A is when you have changed accounts, purchased new assets or every year or so at tax time.