Estate Planning Terms to Know
July 18, 2022
Estate planning is an extremely important process, but it can be a confusing one to someone unfamiliar with it. As with any legal issue, conversations with your estate planning attorney are filled with terms that may sound utterly foreign to you. That is why who you choose to work with to create your estate plan is just as important as creating the plan itself.
At the end of the day, the decisions regarding your estate plan are yours and yours alone. At the Law Office Of Corey J. Rossi, PLLC in Tonawanda, New York, we make sure that we spend all the time you need for us to explain the tools of an estate plan and the terminology that accompanies them. Moreover, we do so in a way you can clearly understand, so you can be confident in the choices you make.
Why Is Estate Planning Important?
The value of estate planning rests in your ability to decide what happens to the assets and debts you have accumulated during your life when you die. Some estate planning tools also allow you to choose who will make personal, health, and business decisions in your stead should you become unable to make them yourself. Other tools help you garner tax advantages for yourself while you are alive and for your beneficiaries when you’re gone.
Without an estate plan, the court determines what happens to everything you own. If you want to protect your legacy, you need to create an estate plan, no matter how little or how much you have to leave behind.
Important Estate Planning Terms
As estate planning attorneys, those of us at the Law Office Of Corey J. Rossi believe you should be familiar with at least a few of the critical terms you will hear while creating an estate plan. Of course, we always welcome the opportunity to teach you more, but here are 12 basic terms.
Decedent: The decedent is the person who died and whose estate is administered after their death.
Estate: Estate refers to the assets and liabilities belonging to the decedent. This includes real and personal property and debts in the name of the decedent.
Probate: Probate is the court process for validating or invalidating a will. Probate also refers to the court’s oversight and direction of all matters related to the administration of the estate and other estate-related matters.
Intestate: Intestate describes a person and their estate if that person dies without leaving a valid will. The probate court pays valid creditor claims against the estate, then distributes the residual to heirs of the estate according to the laws of intestate succession.
Will: A will is a testamentary document. It may appoint an executor, revoke or revise a previous will, nominate a guardian for a minor child, and specify the distribution of a decedent’s estate.
Trust: Trusts assign property to a trustee to manage for the benefit of the beneficiaries of the trust. Living trusts transfer the trust creator’s property to the trust during their lifetime. Testamentary trusts become effective upon the trust creator’s death. Living trusts are not subject to probate, but testamentary trusts are.
Beneficiary: A beneficiary is a person or organization named in a will, insurance policy, or a payment on death (POD) or transfer on death (TOD) to receive money or property. Beneficiaries are also those individuals or organizations designated to receive benefits from a trust.
Executor: An executor is the person named in a will and confirmed by the court to administer the estate as the decedent has requested in the will. If there is no will, the court alone will appoint an executor to oversee the administration of the intestate estate. The will maker can name co-executors or a successor executor should the prime executor be unwilling or unable to serve in that capacity for the decedent. This is also referred to as the “personal representative.”
Power of Attorney: Powers of attorney are various documents designating a person with the right and authority to make binding decisions for another person. Powers of attorney can be broad or limited. It must be a durable power of attorney to allow the agent to act after the death of the person granting authority.
Advance Healthcare Directive: An advance healthcare directive is also known as a “living will.” This document affirms a person’s wishes regarding issues such as the use of life support or other medical treatments, typically when death is imminent.
Guardianship: A guardianship is a legal relationship between a person or institution named in a testamentary document or appointed by the court to care for a minor child.
Conservatorship: A conservatorship is a legal relationship between a person or fiduciary named in a testamentary document or appointed by the court to care for an incapacitated adult.
Legal Guidance You Can Trust
There is nothing confusing about the terminology of estate planning for an experienced estate planning attorney. Just remember that you, not the attorney, must make your own decisions.
At the Law Office Of Corey J. Rossi, PLLC we will ensure that you understand every legal term in a way that makes sense to you. If you live in Tonawanda, Wheatfield, Amherst, Erie County, or Niagara County, New York, call our office to schedule a time to begin your estate plan.