All that a person owns, less all that person’s debts

If the deceased has executed proper legal documents (Will) The activities of the estate will be carried out by the executor Executor-person or institution named by the decedent to carry out these functions If person dies without a will (intestate), the state will name an administrator who will carry out duties

The rights involved in estate planning Estate taxes - legal entity is required to pay taxes Inheritance taxes-those who inherit may become liable to pay taxes to the state.

Language of estate planning Testator-person who makes out a will Decedent-person who has died Beneficiary-one who receives an inheritance Contingent beneficiary-one who takes the place of named beneficiary who has already died Bequest-specific property or money given to beneficiary

Language of estate planning Cont. Life Estate-form of bequest with some strings attached Executor or Executrix-person or institution that one names in a will to handle the affairs of the estate Administrator-appointed person if deceased does not have a will Probate-court proceeding in which validity of will is established

Basic clauses of a Will Introductory Clause Revocation of Prior Wills Debts and Final Expenses Bequest Clauses Survivorship Clauses Appointment Clauses The Execution

Changing a Will 2 ways: –revoked by a brand new will –codicil-document used for minor changes Cannot be legally amended by crossing out or adding words, removing or adding pages, making erasures Copies: –attorney - original –keep a copy for yourself –bank if you have named them as executor or coexecutor

When should a Will be amended- reviewed every 3 years Move to a different state Changes in family circumstances Substantial changes in assets and liabilities Heirs have died Executor or guardian dies Tax laws changed

Uncommon Wills Beware of “do it yourself” estate planning shortcuts Holographic will - prepared in handwriting of testator Noncupative will - spoken by the dying individual to another party

Other means to pass on wealth Trusts-strings attached Gifts-money can escape taxation Insurance Joint names

What should your state plan accomplish Proper liquidity and distribution of assets Program of sound management of assets The assured continuation of a family’s lifestyle in the event of death, disability, or retirement Minimize taxation –estate taxes –inheritance taxes –income taxes