Many people in Illinois may be thinking about how to handle their assets in the future. People want to ensure that their loved ones are provided for while also avoiding excessive estate taxes and fees. Trusts may be a good option to include as part of the estate planning process, because they provide greater privacy, flexibility and control. There are several different types of trusts that people may make use of as part of their estate plan, including irrevocable trusts.
Estate planning refers to a series of decisions that a person is empowered to make under Indiana law prior to death. Many factors can affect a person's estate plan, including the amount and kind of assets owned by the person, the number of living children or children of deceased children, estate and income taxes and any special circumstances that the person executing the documents wishes to use to dispose of particular assets. Another factor that has affected estate planning decisions in Indiana and other states during the last two decades is the advancement in medical care that can keep a person's organs functioning even if the person lacks mental or physical capacity.
The estate planning device known as a "special needs trust" has become the cornerstone of financial and estate planning for families with a special needs child. Many families have used this estate planning tool with great success, but special needs trusts cannot be viewed as "one size fits all" planning tools. Every situation is different, and every special needs trust must be tailored to the individual beneficiary.
Most individuals who live in northeastern Illinois and northern Indiana have heard about "living wills," but not everyone understands this legal term. A "will" is considered by many people to be a written document that directs the disposition of a deceased person's assets following that person's death. "Living wills," on the other hand, serve a different purpose: to express a person's wishes about end-of-life medical care and living circumstances. For this reason, these documents are often referred to as "end-of-life directives." Both Illinois and Indiana have enacted statutes that authorize living wills, but the two statutes differ only in detail.
When Illinois residents are thinking about their estate planning needs, they will generally focus on the basics, like wills and trusts. There are other aspects to an estate plan, but it is important to tailor the documents to the individual's needs. For those who are in a situation in which they might need a power of attorney, it is imperative to understand various critical points about such a document.
Illinois residents who want to make certain they are fully organized and that their loved ones are cared for after they have gone will take the necessary steps to have a comprehensive estate plan in place. While this is a good idea regardless of the circumstances, many people will be uncertain as to whether wills or trusts are better for them. There are many factors to consider when making that determination.
One of the main reasons people in Illinois and across the nation formulate an estate plan is to avoid family disputes after they have gone. This is especially worrisome for those who have substantial assets, but it is a concern for anyone.
In Illinois, a frequent concern for people who are crafting their estate plans and thinking about every possible eventuality is what they will do if they need another person to make health care decisions in their stead. This can be a difficult issue to come to grips with, but it is wise to be prepared for it. A health care power of attorney will let another person - an "agent" - make the decisions on the individual's behalf. This can encompass many parts of the health care process and, before granting someone this power, it is important to understand what it entails.
Some individuals in Illinois might see news stories about relatives of famous or wealthy people engaged in an estate plan dispute, and they may think it does not apply to them. However, crafting estate planning documents is critical regardless of the circumstances. A prime example of why is exemplified with the estate of the late singer Aretha Franklin.
Although formulating an estate plan is becoming more common for Illinois residents, there is still a perception that only those who are of significant means need to have one. This is a mistake that can be costly in multiple ways. Not only does it hinder attempts to preserve assets, but it can have tax implications, spark family disputes and cause other problems that are avoidable. Having a basic estate plan is critical and there are several reasons for these that people might not have considered.