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East Alton Estate Planning Law Blog

Are you prepared for the possibility of incapacity?

In the past few decades, medical technology has advanced to the point where people are living longer. At the same time, a whole generation of people is now reaching or is in their retirement years. The demand for long-term care services is increasing dramatically because of the intersection of these two factors. In accordance with the rules of economics, when the demand goes up, so does the price.

Long-term care is in higher demand partly because as people live longer, they still suffer from ailments, both chronic and acute, that limit their ability to care for themselves. Perhaps you are part of this generation and you fear you may become one of those people. If so, then you may want to prepare for incapacity as soon as possible.

Does the potential for abuse have you avoiding power of attorney?

As you work to create your estate plan, you may know that you want to create a will in order to distribute your assets. In fact, you may only consider the tools that could help you set your end-of-life affairs in order. However, your estate plan can encompass much more information, and you may also want to review your options for planning for potential incapacitation.

In particular, appointing a power of attorney agent may be worth your consideration. You may have heard about naming an agent to act on your behalf when it comes to financial matters in the event that you can no longer make important decisions for yourself, but you could have also felt hesitant about making such an appointment. After all, couldn't someone abuse that power and just run off with your money?

Should you directly bequeath assets to a loved one using SSI?

If you have a disabled loved one, you may consider leaving him or her a considerable inheritance as part of your estate plan. After all, most people find it a great benefit to obtain a sudden, and possibly unexpected, influx of money. You may also believe that naming a special-needs individual as a beneficiary could help him or her carry on receiving needed care.

While your intentions may be in the right place, your actions could actually end up causing more harm than good. In particular, if your loved one receives Supplemental Security Income, he or she could possibly lose that benefit by obtaining a considerable inheritance.

Specific details may prove useful in your living will

If you feel that the time has come to fully address your estate planning needs, among your priorities may be to understand planning tools that may also prove useful while you remain alive. Many people think that estate plans address only after-life desires, but certain documents could help individuals detail how they would like certain affairs handled in the event that they cannot do so for themselves.

In particular, a living will could prove useful to you. This type of document does not relate to your assets like a standard will does; instead, a living will details how you want your care handled in the event that you face a serious medical issue. This document can seem especially appealing because you generally can include any details you wish in reference to your care.

Are you aware of mistakes that could impact your beneficiaries?

Estate plans can serve many purposes. When it comes to using this plan before your death, you can detail how you would like your medical treatments handled in the event that you cannot express your wishes yourself, and you can appoint individuals to handle decisions relating to your health care and your financial necessities during such a time. Your plan can also be useful after your death as you detail how you would like your property distributed, who should act as guardian of your minor children and other similar decisions.

After creating your plan, you may feel a sense of accomplishment, and you should. The information you provide in documents that make up your plan could help your surviving family in many ways. However, if you do not remember to periodically review and update your plan, your family could face issues when it comes time to probate your will and distribute your assets.

Should you create an incentive trust for a loved one?

Most Illinois parents and grandparents have high hopes for their children and grandchildren. They want to see them succeed in life and may take steps to ensure that they have an incentive to achieve their goals.

You may be one of those parents or grandparents, and as you engage in estate planning, you may wonder whether you can do something to help and inspire them even after death. You may be able to execute an "incentive trust" with a particular loved one as the beneficiary. Of course, the trust must remain within certain legal limits and needs to be correctly handled in order to stand up to any legal challenges.

Not having a plan may be the biggest estate planning mistake

At this point in your life, you may find yourself going back and forth between deciding whether it is time to create an estate plan or if you even need one at all. This debate is one that many Illinois residents certainly have, and a misunderstanding of the benefits of estate planning may add to the hesitation of creating a plan of your own. If you think that estate plans are only for people with a substantial amount of money, you do not have the right information.

Estate planning can offer benefits to anyone. It has many purposes that go far beyond simply deciding what should happen to your assets after your death. Because of these various uses, individuals of all income levels and of any adult age could find creating a plan useful. As you consider how to begin your planning process, you may want to work toward avoiding these possible errors.

Do you think an estate plan is unnecessary?

Though you may want to avoid thinking about your life eventually coming to an end, it happens to everyone. The manner in which it happens varies from person to person, and for some people it occurs unexpectedly while others may learn that they do not have much time left. Because either of these scenarios could happen to you, you may want to consider how you would like to leave your affairs.

Estate planning could allow you to closely examine the personal and financial aspects of your life and how you would like those areas handled after your demise. You may think that your family will know what to do on their own, and as a result, you may believe such planning to be unnecessary. However, without a plan, Illinois state laws could come into play, and your family could face complications when it comes to closing your estate.

What happens if you forget to add assets to your trust?

Because of the variety of estate planning options available to you, you may want to take your time when it comes to deciding which tools to utilize. Your estate plan will play an important role in the closing of your estate after your passing, and you will undoubtedly want to ensure that you complete your plan in the manner you desire. Of course, certain issues could arise with your plan, and due to this potential, you may want to consider how to best safeguard your plan.

If you choose to utilize a trust-based estate plan, you can place your assets into the trust in order to ensure that the property is distributed according to the terms you set forth. Depending on when you create the trust, you may obtain additional property that also needs placing into the trust. However, what happens if you forget to add those assets?

Could a Crummey trust help you avoid gift taxes?

You, like many other Illinois residents, may find taxes stressful and inconvenient. This displeasure may stem from various misunderstandings about taxation as well as the potential for you or family members to owe a considerable amount of money to the government for various reasons. If you hope to gift money or provide for loved ones after your death, you may have an interest in how taxes could come into play.

Gift taxes often apply after you reach a certain threshold every year, and while you certainly understand that you cannot hold on to money after death, you may still feel that distributing your funds too early could cause tax complications. However, you may have the ability to avoid gift taxes by utilizing a Crummey trust.

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Leonard F. Berg, Attorney at Law