I recently had a friend of mine call to tell me that his father had died, and that he appeared to have died without a will. This particular client was concerned because his father was an owner and operator of a successful business in which he was the only shareholder. My friend had a very large family that included many brothers and sisters of which only a few of them had any interest in continuing their father’s business. However, all of them wanted their fair share of any potential profits from the sale of the business after his death.
The complexity of these questions show the need for estate and transition planning for everyone, including people with complex estates and simple estates.
Because of the complex nature of tax planning, l will discuss the most simple and basic will provisions.
Tools for estate planning
This article is too short to discuss all of the options available for estate planning. However, some of the tools available for estate planning are as follows: a will, a living will, a power of attorney for healthcare, a power of attorney for property, and irrevocable trust.
What if I don’t have a will?
What most people don’t realize is that if you don’t have a will, the state of Illinois has written one for you. It is a statutory provision that provides for an estate succession. If you do not write a will and you are married with children, absent any special provision, half of your estate will go to your spouse and the other half will be divided equally between your surviving children. If there are any children who predecease you, but have children of their own, the estate may be further distributed. This is commonly referred to as intestate (without will).
Why is it important to have a will?
The real purpose of a will is to help the living, not the deceased. A will provides two areas of instruction:
- Allows the deceased to discuss the distribution of their property, assets, obligations, and other items in a way that is predetermined by the deceased at the time of the execution of the will. For example, if mom always wanted grandma’s dishes to go to her daughter and not her son, the will is the place to provide for that kind of request.
- Opportunity to give any special instructions, for example, the desire to be cremated or buried.
While sometimes the provisions of the will may not be entirely enforceable, it provides guidance to the surviving descendants in decisions regarding the estate, including but not limited to funeral planning.
As mentioned above, the complexities of estate planning and tax considerations require a consultation with an attorney experienced in both probate and financial consulting in order to address all possible options in transferring wealth and assets.
Estate planning is about avoiding confrontation and answering questions at a time before illness or incapacity can render these kinds of decisions both difficult and controversial.