In a world full of uncertainties, it is important to prepare for the future regardless of your age or wealth status. An estate plan provides a great opportunity to plan for the future. It allows you to control who receives your possessions, when, and what they will receive in case of your death or incapacitation.
An estate plan is one of the best gifts you can give your family as it helps preserve wealth and avoid unnecessary conflicts. Estate planning allows you to create and protect a legacy while you are still in control. Good estate planning can also help you minimize legal fees, estate-related taxes, and court costs.
However, the estate planning process can be complex and you might need the help of an estate planning attorney to help you navigate the legal complexities.
What is Estate Planning?
Estate planning is the process of creating a plan to manage your assets in the event of your incapacitation or death. Simply put, it is a way of protecting your assets, your loved ones, and your legacy. One of the goals of estate planning is to keep your assets out of the court’s control.
Estate planning involves giving instructions on how you want your assets distributed in the event of your death. It also consists of your wishes on who should make financial and medical decisions on your behalf if you become incapacitated. In both cases, it helps avoid conflict as your loved ones know of your wishes.
A typical estate plan consists of several essential documents, including:
- Wills and Trusts – a will is a legal document providing instructions on how would like your assets distributed after your death. The will consists of the name of the person you have chosen as your estate’s executor or administrator. They will also appoint a guardian for your minor children. A trust is like a will in many ways but it provides for the naming of a third party as your estate’s administrator or trustee.
- Power of Attorney and Healthcare Proxy – a power of attorney (POA) is a legal document in which you appoint someone you trust to make important decisions on your behalf if you become incapacitated or die. When the document is for making medical decisions on your behalf, it is a healthcare proxy.
- Durable Power of Attorney – it is a legal document like a POA that appoints a person to make financial and legal decisions on your behalf but its mandate or authority ends with your death.
- Living Will – it is a legal document outlining your end-of-life healthcare plans or wishes.
The Benefits of Estate Planning
Estate planning helps you plan in advance regarding any legal, financial, and medical matters that may arise due to your death or incapacitation. Some of the specific benefits of estate planning include:
1. It protects your family. Estate planning protects your family and beneficiaries by preserving wealth for them. It ensures they are financially taken care of. It also protects them from probate, the often long and costly asset distribution court process.
2. It protects your legacy. Estate planning helps you execute the plan you have for your estate even after your death or incapacitation. It achieves this by letting you name an estate administrator to carry out your wishes.
3. It lets you choose who will make important decisions on your behalf if you can no longer do so yourself. It allows you to appoint a person you trust.
4. It protects your minor children. By allowing you to choose guardians for your children, an estate plan lets you, and not the court decide who will raise your children in case you die or become incapacitated.
5. It reduces federal and state estate-related taxes. Estate planning reduces the tax burden for your beneficiaries, including the income tax they may need to pay.
6. It eliminates potential family fights over the assets you leave behind. Estate planning helps you state your wishes and hence avoid family conflict later.
Arizona Estate Planning Laws
Estate planning laws and related issues vary from state to state, so, it is crucial to understand the laws that apply in your estate. Arizona outlines its estate planning laws in Title 14 of the Arizona Revised Statutes. Besides the state laws, federal laws are also applicable in the creation and implementation of estate plans in Arizona.
Some of the critical areas that the Arizona estate planning laws cover include:
- Taxation
Arizona doesn’t impose estate or inheritance taxes meaning you can transfer most simple estates without tax. However, federal estate taxes are applicable for estates that exceed a certain valuation threshold. Estate gifts are also subject to federal gift tax. However, laws are subject to change, including tax laws. It is advisable to keep an eye on any changes to ensure your estate plan is up to date. An estate planning attorney can help you keep up with the changes.
- Wills and Trusts
Arizona laws do not restrict the creation of wills for estate transfer or administration. However, you must follow specific rules and regulations when creating and executing your will. Similarly, you must follow the law when creating trusts, including the scope and validity of the legal document.
A skilled estate planning attorney can help you create wills and trusts that are valid and enforceable by ensuring you adhere to the necessary Arizona rules and regulations.
- Intestate Succession and Probate Administration
When a person dies without an estate plan, they die intestate and their estate is subject to intestate succession and probate administration. In such cases, the state through the court handles asset distribution of the estate. Arizona estate planning laws provide for the distribution of the estates to various parties, including illegitimate children.
Your family can seek the help of an estate planning lawyer to guide them through the probate process. However, you should have an estate plan to protect your family from the court process altogether.
Contact a Tucson Estate Planning Lawyer
Having an estate plan is one of the best things you can do to protect your family and your legacy. Yet, estate planning can be overwhelming as it involves making important decisions about your future, including contemplating death. The complexity of the issue can lead to mistakes and emotional decisions.
It is advisable to seek the help of an estate planning attorney to offer guidance and help you avoid costly mistakes. If you are in Tucson, contact our well-qualified and experienced estate planning attorney at St. Clair Law. Our lawyers are experts in estate planning and related processes like probate and we will help you protect your family and legacy. Contact us today to schedule a consultation and learn more about our estate planning services.
