Estate Planning, Probate and Trust Administration

Wills

There are many reasons why every adult should have a valid, thoughtful and carefully planned will. Your will is a legally binding but completely amendable document that can guarantee that your most important lifetime decisions and desires will be honored and realized after your death. It is usually a document written and executed under the necessary direction and assistance of a competent attorney in accordance with certain formalities prescribed by state law.

Your will is one of the most important documents you will ever sign. It is the means by which you will direct the distribution of your property- property from your estate that you have worked a lifetime to acquire- which will contribute to the financial security of your beneficiaries and benefit causes which you think are important and memorialize your own existence.

Your willl is an important tool by which you can direct who, specifically, will receive your property when you die. In the absence of a will, the state will distribute your property as directed by certain rigid and impersonal state laws, and in ways that may be contrary to your wishes.

Your will can nominate persons whom you’d like to serve as the guardians of your minor children who will be responsible for and make decisions regarding their custody, care and placement until they reach the age of majority. Your will can nominate persons whom you’d like to serve as the conservators of property left for your minor children who will be responsible for and make decisions regarding how that property is managed and used until they reach the age of majority. A court normally respects such wishes. But in the absence of a will expressing such wishes, a court must appoint guardians, conservators and other fiduciaries to administer your property and estate who may not necessarily be persons whom you would choose. This could result in rigid, cumbersome and expensive guardianship arrangements. For example, if a father of minor children dies without a will, a court can appoint the surviving mother guardian of the children and order her to incur the costs of posting bond and reporting all expenditures of assets belonging to the minor children. A provision in the will could avoid such cost and bother.

Certainly, you will want the guardian and conservator for your minor children to reflect your values and your lifestyle. In your thoughtful will you can take the steps to control the influences that will be present in your children’s environment after your death. Your attorney can help you make such choices and phrase your document to address certain concerns and to maximize the amount of property that may actually go to your beneficiaries.

If you have concerns whether your survivors would really be qualified to manage and budget their inheritance after your death, your will can be arranged to guarantee them all of the rewards and advantages of property ownership, without its burdens and bothers.

Your will can also be used to make meaningful memorial gifts to your favorite charitable, religious, educational, health, or cultural organization or institution. The cost of such bequests can often be reduced if your will is planned to take advantage of major tax deductions that Congress has provided for this very purpose.

Finally, in your will you can and should name an executor to carry out the directions in your will and to help your family with any of the special personal or business problems that may arise after your death.

Trusts

One way of coordinating your will with many of your other assets is to use a “revocable” trust (one that you can revoke, recall, change or cancel at any time as long as you live) as the cornerstone of your thoughtful and effective estate plan.

First you create the trust during your life and can designate yourself as the initial trustee thereby retaining management and control over the trust property until disability or death. In the trust agreement you direct exactly how you want the trust property to be used after your death. You can name the trust as the beneficiary of your life insurance (and perhaps your employee benefits). Your will can direct that certain of your securities, savings or real estate be paid into the trust at the time of your death. The objective is to get your major assets into the trust where they can be managed by a trustee whom you designate to manage and administer during your lifetime and after death. Assets placed into the trust during your lifetime will escape the costs and delays associated with probate.

During your life the trust can be unfunded if you like- a mere empty receptacle. Or you can use it for investment management. Remember- you may retain the right to change or revoke the trust at any time during your lifetime or until you are disabled. At your death, the trust becomes absolute and irrevocable, its primary function being to provide for your designated beneficiaries.

Other types of trusts may be created and used with specific purposes in mind, such as the following:
Charitable trusts which may provide tax benefits and other financial rewards, while designating a portion of your property for eventual distribution to charities of your designation.
Credit Shelter or A/B Trusts which may be used to shelter assets from estate taxes.
Testamentary trusts are trusts that are included within your Will and take effect upon death. However, unlike a Revocable Living Trust, the assets passing into a testamentary trust do not avoid probate administration.

General and Durable Powers of Attorney

Unlike conventional estate planning documents that deal with transfer of property to beneficiaries at the death of the Maker (IE., wills), the general or durable power of attorney operates during the Maker’s lifetime and allows individuals chosen by the Maker (principal) to act on his or her behalf. The document may be drafted in different ways conferring different powers and limitations depending on the needs and objectives of the Client. These should be discussed with an attorney.

When a principal (Maker) delegates such authority to the agent, the agent may enter into binding transactions on behalf of the principal as long as the agent acts within the score of his or her authority. Under common law, the authority of the agent, acting pursuant to a general power of attorney, terminates when the principal becomes incompetent or dies. However, under Michigan’s applicable statute, a power of attorney that is not a durable power of attorney in writing does not terminate until the agent receives actual notice of the death, disability, or incompetence of the principal.

Under Michigan’s durable power of attorney statute, the agent’s authority either continues when the principal becomes disabled or becomes effective upon the principal’s disability. A durable power of attorney is an alternative to judicial guardianship and conservatorship. It allows the client who anticipates the possibility of incompetence or other disability to provide an efficient, private mechanism for dealing with his or her own affairs without court intervention. The powers given by the instrument, however, must be conferred before the onset of disability.

Durable Power of Attorney for Health Care

Michigan’s durable power of attorney for health care statute expressly allows an individual to appoint an agent, termed “patient advocate” in the statute, to make medical or mental health treatment decisions and anatomical gifts if the individual is at least 18 years old and of sound mind when the designation is made. The instrument for designating a patient advocate provided for in the statute is a durable power of attorney that applies specifically to health care decisions. The patient advocate steps in when the patient is unable to participate in medical or mental health treatment decisions.

Under the statute, the designation of a patient advocate may include a statement of the patient’s wishes regarding care, custody, and medical or mental health treatment. Furthermore, the patient may authorize the advocate to exercise one or more powers concerning the patient’s care, custody, and medical or mental health treatment that the patient could have exercised on his or her own behalf. However, the patient advocate may not exercise any powers that the patient, if able to participate in the medical or mental health treatment decisions, may not have exercised on his or her own behalf.

With the assistance of an attorney, the durable power of attorney for health care may be drafted and crafted to prepare for and address the situation where a person is rendered disabled or incompetent as the result of a mental or physical condition and is unable to make proper decision regarding medical and mental health care and treatment. It is a necessary component of any comprehensive estate plan.

Living Wills

The term “living will” is a misnomer. It is not a will. It is a declaration that instructs physicians and others to withhold or withdraw life-sustaining procedures and equipment in the face of certain death. The word “living” in “living will” refers to the fact that the declaration is made by the person while he or she is still alive and competent to make decisions regarding medical care. Living wills are not recognized in Michigan by statute or under common law. Nevertheless, because it may have some evidentiary value on determination of such issues, it is sometimes drafted as a separate document and incorporated by reference into the durable power of attorney for health care which is recognized by statute in Michigan.

Other Estate Planning documents

Other estate planning documents may be recommended, prepared and drafted to meet special needs or situations, or to supplement the primary documents mentioned above. Examples include special needs trusts, Certificate of Trust Existence and Authority, Affidavits, Trust funding instructions, deeds, and other documents. All documents that become part of the estate plan will be prepared and agreed to on a case by case basis depending on the needs of the Client, fees and other factors.

Probate, Estate and Trust Administration

When a family member becomes incapacitated, Bosler Law Office PLLC is available to assist with all aspects of estate and trust administration, including petitioning for or representing persons in guardianship and conservatorship proceedings. When a family member dies, Bosler Law Office PLLC is available to assist with all aspects of administration of probate and trust administration. The probate process is a supervised procedure required to transfer property according to a Will, or according to state law when the deceased person does not have an estate plan. During the process, subject to various levels of court oversight depending on the circumstances, the fiduciaries for the estate will locate, inventory and marshall the decedent’s assets, pay estate taxes and the claims of creditors, and distribute the remaining assets. When a deceased person has a Trust, we can assist the Trustee in the administration of the Trust to make sure that the trustee and trust beneficiaries are protected and the administration of the Trust proceeds as efficiently as possible. Occasionally, disputes arise between relatives of the deceased during the probate or trust administration process. Our negotiation and litigation experience can help resolve such disputes in trust or probate litigation. We are here to help you navigate through and understand the probate and trust administration process. Our problem solving approach looks for the most efficient methods to arrive at a satisfactory resolution. Please contact us should you need assistance with any of these matters.