The questions and answers below are in response to some of the most common questions we get from prospective clients. The information is not intended to be legal advice and you should not rely on these questions and answers to formulate or implement your estate plan. Before taking any actions on your estate plan, you should consult with an experienced Estate Planning attorney who can properly advise you. The information below is intended to provide general information available to the public.

QUESTION: I don’t own many assets so why do I need a Will or Trust? Aren't Wills and Trusts for people with a big estate?

ANSWER: A Will or Trust, if drafted properly, will help ensure that your wishes are followed after your death regardless of the size of your estate. The distribution of a persons' assets is likely to be just as important to someone with a small estate as someone with a large estate. Issues that are common concerns for most people include: distribution of property, care for minor children, care for a special needs child, providing for grandchildren, establishing educational funds for children and grandchildren, donations to charities, schools, or foundations, and at what age should your heirs be allowed to receive any funds. Without a Will or a Trust, your wishes are left up to the court and whomever becomes the administrator of your estate. The court will not be able to follow your wishes and will distribute any property pursuant to the laws of the state. In addition the laws of the state don’t take into consideration which method of distribution is most advantageous to your heirs and most tax-efficient. Needless to say, a Will or Trust is an essential document for anyone regardless of the size of estate.

In addition, most simple wills drafted by an attorney may range from a few hundred dollars up to around $1000 for a very complex situation. However, most complex situations are better handled with a Trust. Trusts are more expensive because they involve a comprehensive document, greater planning, review of business or financial assets and substantially more time drafting. Although the cost may seem high, it pales in comparison to the cost of not drafting one. Depending on the size of your estate, your heirs may end up with an estate tax bill that may be extremely large, or with costs and fees that could have been avoided.

QUESTION: I live in Kansas and the bulk of my property is in Kansas, but I also own some real estate in Colorado and Oklahoma that I want to make sure goes to 100% to my son Joe. If I die without a will or trust, how will my property be distributed?

ANSWER: If you die without a will (also called dying "intestate") the laws of each state will determine how your assets are to be distributed to your heirs. In addition, you will have 3 different probate proceedings, one in Kansas, one in Oklahoma, and one in Colorado. Each state will handle the property in accordance with its own laws. Kansas may direct property to go one way, while Oklahoma and Colorado will direct the real estate in their jurisdiction to pass in accordance with their laws. Depending on your family situation and which heirs remain living, property could very realistically be divided among children, parents, spouses, aunts and uncles, cousins or some combination between these people. Since each state has its own law of intestacy it is impossible to know how much a spouse, child or parent may get. The property in Colorado and Oklahoma has a very high likelihood of being owned by not only the son, but also by the deceased persons' spouse and any of Joe’s siblings depending on who is still alive. To best accomplish this individual’s wishes, a will or trust should be drafted to meet his or her needs and to ensure a smooth property succession.

QUESTION: How many people die without a Will or Trust?

ANSWER: Different studies have reached different results. The National Estate Planning Council says that estate planners estimate nearly 70% of people don’t have a will. In contrast, one article on the American Bar Association’s Website, www.abanet.org, indicates that the number of Americans without wills is about 60%, another article at the ABA indicates that the number of people with wills has grown by 50% in the last 15 years citing several factors including interest in living wills, simplified procedures, and lower costs.

QUESTION: I have heard that I need a trust, but I do not want to give up control of my assets and have them administered by someone else like a bank or trust company. What solutions are there for me?

ANSWER: Fortunately with a Revocable Living Trust, you can maintain the control of your assets and act as your own trustee. In fact, after establishing a Revocable Living Trust, much of your daily financial and business transactions will remain the same as before you had the trust. Depending on your situation, you will likely need to fund the trust which would include changing the title on Real Estate, Bank Accounts, modifying Beneficiary Designations on some investments or insurance, and signing a document stating that your personal property and household items are included in the trust. The most important thing is that you maintain control of what goes into the trust, what stays outside of the trust and the management of all property covered by the trust. You also get to select who is to be trustee after you die and will be responsible for carrying out your wishes. In selecting the successor trustee, you may consider choosing one of your adult children, a spouse, family friend or relative, or a corporate trustee like a bank or trust company.

QUESTION: OK, so I can be my own trustee and maintain control of my regular finances in a similar fashion as before setting up a trust, but what if I want to make changes to my trust? I always thought that once a trust was created, it could not be changed.

ANSWER: With a Revocable Living Trust, the Grantor (a/k/a the person(s) who established the trust) can change, revoke, modify, and restate the trust at any time during their life. Upon the grantor’s death, the trust becomes irrevocable. Typically, in a situation where a husband and wife jointly establish the trust, the trust remains Revocable until the death of both spouses. This permits the greatest flexibility not only during both lives, but allows the surviving spouse to continue living without a rigid set of rules to follow. A revocable trust drafted by an experienced estate planning attorney is built for flexibility. The design of a revocable trust is such that it will attempt to maximize the tax and transfer issues that may burden your heirs while still allowing you to make as many modifications to the terms of the trust as well as the assets being held in trust as you may like. Furthermore, if the law changes where a certain provision should be added to your trust, a revocable trust will allow for the addition of the appropriate language. Be cautious, because if flexibility and the ability to modify your wishes is a primary concern to you, you want to make sure that you get a revocable trust. An Irrevocable Trust, which can be extremely useful and the best way to proceed in some situations, will not be the correct choice for you.

QUESTION: I am the owner (shareholder or partner) of a business. I have had the good fortune of doing well and have amassed a sizeable estate. My concern is protecting as much of my estate as possible from taxes and probate fees so that I can maximize the amounts that go to my heirs and my favorite charities. What plans are available to me?

ANSWER: There are many options available to you. Creating a trust is certainly an important issue that must be addressed. However, what type of trust will vary based on your goals, size of estate, size of gifts to charity, and structure of your business among other things. Depending on the structure of your business and your ownership interest, placing these business interests in trust may be a very good or a very disadvantageous thing, or may be completely impossible. A thorough determination of tax consequences of placing any business assets in trust must first be completed. For your personal assets, located outside of your business, a combination of both revocable and irrevocable trusts may be an attractive alternative. An Irrevocable Life Insurance Trust (ILIT) may be necessary to accomplish your goals or a Charitable trust may fit nicely with your strategy. In addition, depending on your position and the corporate structure of your organization, business and succession planning will likely be an important component of your estate plan. Contacting a qualified Estate Planning attorney to discuss not only your personal situation but also your business situation is likely to be the first and most important step in executing your plan. The attorney can examine your estate and recommend the best course of action to accomplish your goals.

QUESTION: Can I go to any attorney to have these documents drawn up?

ANSWER: If you needed a heart operation, would you consult a surgeon that specializes in knee surgey? Even though the knee specialist would probably have a basic idea of how to do the heart operation, would you feel comfortable, safe, and secure that the procedure would be done correctly? Probably not! By the same token, any attorney has the ability to draft your estate planning documents. But do you want to entrust that all your hard work in amassing your estate will be handled correctly by an attorney who may primarily do criminal cases or personal injury cases and has only handled a few estate plans? We would encourage you to consult an experienced estate planning attorney who has the experience and knowledge of handling many estate plans. Our firm almost exclusively works on estate and business planning and will be happy to offer our knowledge in creating the unique plan that will work to accomplish your goals.

QUESTION: If I want a trust, what documents can I expect to receive from your firm?

ANSWER: Typically, for a Revocable Living Trust, we provide the Trust Document that has been tailored to your specific desires, a Pour-Over Will, a Durable Power of Attorney, a Health Care Power of Attorney, a Living Will, assistance with any real estate deed work and we will provide you guidance as you begin to fund the trust with your assets. All of our trusts are unique to each client and we also include a large number of informational pages in each trust to assist you and your heirs in utilizing the trust. Since each trust is different, the types of pages will vary, but in most cases you will receive the documents listed above plus several more.

QUESTION: I had a trust drafted many years ago and am unsure if I need to make changes to it so that I and my heirs maximize the tax laws to the fullest extent. Can you review an existing trust that wasn’t drafted by your firm?

ANSWER: Yes, we can and do frequently have clients come in for a consultation that have previously drafted documents with another attorney. Usually, a client may come to us and tell us that the attorney who first drafted the documents has moved away, retired, or is no longer practicing estate planning. We are able to determine if the document you have will meet your goals or if you need to make an amendment or possibly restate the trust. In addition, if it has been many years since you last reviewed your trust with an attorney, we would strongly suggest having an attorney review your document as well as seeing if your goals have changed. Furthermore, if you have had a substantial increase or decrease in assets, a change in health status, or a change in family situation, a review is likely needed.

QUESTION: Why do you want me to fill out so much personal and financial information before we have our first meeting?

ANSWER: Without an accurate personal and financial picture of your situation, we do not believe that we can offer you the best advice. So much of what we do and how we plan revolves around the size of your estate, what types of assets you hold, and what special situations you may have with your heirs. We need a complete picture so that we can adequately analyze what techniques would be best suited for you. Rest assured, the information that you disclose to us is kept privileged and confidential. We may disclose some information to our legal assistants or other attorneys in our firm, but it is only for the purpose of creating the most effective documents for you. We take great care to protect your personal information from those who are outside of the firm.

QUESTION: What is the typical process from start to finish to have a Trust drawn up for me?
ANSWER: Although we do not have the knowledge as to what the process is at every firm, we can briefly describe what happens at our firm. Typically, as a new client, we will send you a questionnaire for you to complete. This questionnaire helps us determine the appropriate strategies to discuss with you. We like the client to have at least a week or two to think through the questionnaire because there are important decisions to think through. We will set up an appointment for you that will be approximately 1-3 weeks out from the first time you call. During the first appointment, which is a free initial consultation, you will bring back the questionnaire and the attorney will meet with you to discuss what options are available to you, answer your questions, discuss what the fee for the course of action would be, and if you decide to proceed with us, give you an estimated completion date where you will come back in for signing. The initial consultation will typically last about an hour and you are under no obligation to immediately decide what course of action you want us to pursue and you are not obligated to continue using our firm if you change your mind or decide not to complete the documents. After the initial consultation, if you want us to proceed, the attorney and staff will draft the appropriate documents so that things are ready for the signing appointment. Typically, we can complete a trust and have you back in for signing in about 2 weeks. The signing appointment usually takes between one to two hours depending on the complexity of the documents and the amount of funding assets to address. During the signing, the attorney will go through and explain what was drafted, discuss important provisions, and answer any of your questions before the documents are signed. Overall, the process is usually completed within 4 or 5 weeks after you first call our office, however, some complex situations may take significantly longer, i.e, several trusts, business entity planning, etc.

QUESTION: I have surgery scheduled in 5 days and am very concerned because I haven’t made any plans for the disposition of my estate and I don’t have any healthcare powers documents should something happen. Can you complete my documents before I go in for surgery?

ANSWER: It is not uncommon that we get a phone call like this and when we do, know that we will do everything we can to get your desired documents completed within the timeframe given. When given short notice like this, we can get you essential documents like a Living Will, Healthcare Power of Attorney, and a Durable Power of Attorney that will ease both your worries and your family's concerns. We may even be able to complete a Will if you are able to provide us with all the information in a timely manner. However, the completion of a trust is going to be difficult, although not impossible. A trust is such a comprehensive document, you should want and expect us to produce quality, accurate work. With such a short time frame, we are hard pressed to make sure that all important provisions are inserted correctly and accurately. However, we will always strive our best to meet our clients needs and provide the level of service you expect from our firm. If you are in the situation described above, give our firm a call, and we will attempt to do everything we can to meet your needs.

QUESTION: Why shouldn’t I just do a will on the Internet through a self-help service?

ANSWER: First, I’ll promise you that the radio commentators that are paid well to promote these services are not “looking out for you.” First, look at the disclaimer on the website for the self-help service. It typically is something like this:

“This service is not a law firm, and the employees of this service are not acting as your attorneys. This legal document self-help service is not a substitute for the advice of an attorney.”

Why does this have to be said?

They can make sure that the grammar is correct and the words are spelled right, but they cannot insure that what you want to have happen will, in fact, happen. Let me provide an analysis of what you are buying. Think of it this way, it is much like buying a sharp knife and a bottle of aspirin and performing surgery.

Here is the sales pitch: “Go to super-extra-easy-surgeries-in-a-box.com. Have your own sharp knife. Now, without having to pay a Medical Doctor, Hospital, or other Medical service providers, you can perform surgery on members of your family without the high medical costs usually associated with surgery. You can even anesthetize your children and perform routine surgeries. This self-help surgical service is not your doctor and cannot be sued for malpractice. If you order the sharp knife today the aspirin is yours free. We will include our free DVD showing alternative suture techniques.” You may need some thread and a needle.

And then this:

Testimonial: “I removed my daughter’s tonsils and what I think was a burst appendix from my son’s abdomen all in one afternoon on a table in the basement with the help of a neighbor. Sewing them up was as easy as fixing the seat of Dad’s pants.”

Professional verification: “We sent the sharp knife to a University Hospital, and a teaching surgeon determined that the knife was sharp and ready to perform surgery. This physician also acknowledged that aspirin is a recognized pain killer.”

Then, again, think of the money saved compared to the potential harm inflicted.

I have spent 25 years providing legal advice to those who need assistance in estate planning and with administration issues after the death of a family member has occurred. I get a front row seat every day to observe plans that are incomplete or have gone wrong because a deceased parent or grandparent did not get good advice about how to make all of the legal possibilities work together for a desired result. Sometimes they use an estate plan-in-a-box.

Self-help services do not provide legal advice, but they do provide “education” in the form of incomplete information. You may be told that a will is a document you create to control who receives your property, who will be the guardian of your children and who will manage your estate upon your death. What you are not told is what property a will controls and what property a will does not control. No information is provided as to how and when a will takes control of anything.

I often see family members who, after a death occurs, believe that the will mom or dad had created avoids probate and provides them with authority to act on behalf of the estate. They haven’t been told that a will has no legal effect until it has been approved by the probate court and further, they have no authority to act until they qualify as executor with the court and a court order is entered appointing them as the executor or personal representative. These people don’t know what specific state laws must be complied with. They have not been told that they cannot file all of the documents necessary and required by statute in probate proceeding with the help of a self-service agency. They have not been told they will have to hire an attorney to prepare and file the documents to deal with probate.

Also, people do not know that the probate process takes time-sometimes years! They are not informed that the proceeding is a public one and acquaintances that want to review the court documents (or unscrupulous predators) can monitor everything that is happening, such as what assets exist, who is getting what, and what debts are owed.

Furthermore, family members don’t often have any idea as to what responsibilities they have to creditors, beneficiaries and heirs. They don’t know what creditor rights exist in probate, or what asset protection can be provided. Nor is there any explanation of what asset protection can be provided through probate avoidance techniques, or when these techniques should be utilized.

The potential problems go on and on. If you hold property jointly (joint tenancy with the right of survivorship) and there is a surviving joint tenant, then a will does not control that property. If you hold property in a form that has a death beneficiary designation and a beneficiary is living, then it is not controlled by the will. On the other hand, if you hold property jointly and you are the last owner to die or if you survive the designated beneficiaries, then what happens? If you make children the beneficiaries of a qualified retirement plan and they are minors, then a conservatorship may need to be established even though there is a testamentary trust.

Then, if you have minor children or young adult children that you want to protect, what purpose does the testamentary trust serve? When should this be used? When will a child have outright access to assets if there is no trust-age 18? Also, if it is not drafted properly the trust will not qualify as a designated beneficiary of an IRA or other Qualified Retirement Plan and all of the funds will be subject to income tax immediately.

What is the requirement for someone to qualify with the court as a Guardian? What is your state law in this regard? What should you consider and what specific instructions should you provide for where you would want you child to be reared, what school district to attend, what kind of visitation with family that is outside the state do you want to direct or provide funds for, etc.

If you are going to establish a testamentary (one created at death through the will) trust for minor children, and therefore need to designate someone or some entity as Trustee, what should you know about the duties of a trustee? Where do typical problems develop in the administration of a trust? What kinds of instructions do you want to provide? What kind of discretion do you want to give the trustee? What are the problems with naming family members as Trustee? Should you use the same person as Guardian and Trustee? How can you plan to avoid conflict? Do you understand that the court will have to approve and authorized the Testamentary Trust and annual reports and accountings will have to be made to the Court?

Every state has a different approach to estate taxes. In Kansas, for example, we have a state estate tax that is separate from the federal estate tax. The threshold for filing a Kansas Estate Tax return is 1 million. The document should be state specific if you have assets that would cause you to have a taxable state. The threshold for having to file a federal estate tax in 2008 is 2 million, and then in 2009 is 3.5 million, no tax in 2010 and back to 1 million in 2011. In fact, it is 50% of the value over 1 million in 2011. How can you have a plan that has the necessary flexibility to address the state and federal issues using a fill in the blank self-help service? We are indeed living in an environment where the landscape changes every year.

You would no more want to remove your grandchild’s healthy kidneys than leave them in a position to receive nothing from your estate because you decided to do it yourself. One self-help service proudly advertises that most of their wills are created in fifteen minutes! Are you really going to take what it has taken a lifetime to accumulate and fill in a form in less than fifteen minutes to resolve all of the planning concerns that you should address?

You should understand that attorneys that are good estate planners don’t sell documents. We counsel clients. We ask probing questions and provide advice and information about getting all of your affairs in order. Wills and Trusts and all other estate planning documents, including Powers of Attorney, are not commodities. They need to say the right thing for your situation. Proper advice and special attention paid to the drafting of the documents you end up with is what is required to meet your specific needs. Attorneys that are educated and experienced in estate planning can provide significant value. With proper advice about the use of beneficiary designations and the pitfalls relating to exempt assets and qualified retirement plans you can make sure you keep assets from the hands of potential creditors and avoid the possibility of having assets squandered.

When somebody calls and says: What does it cost to get a will?” I often wonder if this person would call a car dealership and ask: “How much are cars this week?”

I know if I looked, I could buy a car for $69. But, then again, I have some idea of what I would be driving or pushing. Be willing to pay a fair fee for good advice and get your estate planning done right. Work with someone who knows what information to gather, what questions to ask, and what concerns to take into consideration in helping you to get your affairs in order. It is not important that you have a document. It is important that you understand how things will happen if your death occurs-and plan for it accordingly and with the confidence that what you want to have happen, will, in fact, happen.

What I can tell you is that if you do it yourself and something goes wrong with the “airtight” will or trust you prepared yourself, it will become apparent at a time that you can’t fix it-because you will be dead. Fixing the problem for your family, at best, will be more expensive than the money you saved by planning without good advice, and at worst your family may not be possible to correct the unintended result.

- - - Tim J. Larson