Tuesday, March 26, 2013

Wills, Trusts and Estate Planning

Estate planning is important no matter what your age to make sure your goals are carried out after you die.  Proper planning with an attorney can also reduce taxes and help you prepare for important health care decisions in advance. 

Will
A will is a document that states your wishes about what should happen after you die.  The most important decisions are who receives your property and who will take care of your children.  If you do not have a will when you die, the state of Hawaii will make those decisions for you even if they are different than your preferences.  A will can make sure that you make your own decisions for your property and your children. 

It is critical to hire a lawyer to draft your will and other estate planning documents.  Estate planning laws are different in every state and unless your estate planning documents are drafted with special consideration to Hawaii specific laws, your plans for what happens after you die may not be carried out. 

Family arrangements vary widely and you should carefully consider if your situation needs special planning.  A prior divorce, step-children and civil unions will all have impacts on your estate plan.  It is also important to make a will if you want to leave property to friends or distant relatives since they may not otherwise receive anything. 

Trust
A trust can give someone the benefit of your property without actually receiving the property immediately.  You may give your property to a trustee when you die and the trustee will take care of the property while giving the benefit to someone you name.  For example, you may specify that your house should go into a trust, a trustee make important decisions about the house and maintain it while a favorite niece lives in the house.  This is just one scenario and there are many different kinds of trusts to accomplish your desires. 

Tax Planning
Another reason to plan ahead when you die is that your property may be subject to an estate tax.  Both the federal government and Hawaii impose a tax on your estate when you die.  Proper estate planning can reduce or avoid taxes on your estate. 

Living Will and Durable Power of Attorney

An Advance Health Care Directive combines a power of attorney for health care and a living will into one document.  This document allows you to specify who will make your health care decisions if you are not able to make them yourself.  If you have specific instructions for your health care such as what happens when you are in an extended coma or if you want to donate your organs when you die, the Health Care Directive can also state those. 

There are many powerful estate planning techniques available to accomplish your goals for your family and property after you die.  Proper estate planning with an attorney can give you peace of mind knowing that your wishes will be carried out. 

Click here to see the many statutes that govern Hawaii estate planning law.  Hawaii Uniform Probate code
 



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