Wills and trusts are legal documents allowing you to help loved ones and causes you care about. A trust could allow others to benefit from your assets long after you’ve passed away. Through a will after your death, your assets can go to those you care most about, including charitable causes. Both documents allow you a degree to control what happens to your assets and who will benefit from them.
A will is a signed written document in which a person (the testator) creates instructions for what’s to be done with his or her property after death. It needs to be signed by the testator and by two witnesses. If the testator is unable to physically sign his name he may direct another person to do so. Each witness must sign the will in the testator’s presence.
Through a will, you can:
- Direct how you want your property divided
- Name the person you want to handle your estate (the executor or personal representative)
- Reduce the expenses of administering your estate
- Save taxes
- Nominate a guardian for your minor children
If you follow the requirements your will be valid until you revoke it, either by physical destruction or having a superseding will or written revocation created. Since your will doesn’t take effect until you die you can change or revoke it at any time during your life as long as you are mentally competent.
If you don’t have a will a state statute dictates who will receive your property. Under Virginia law if you’re married, he or she will probably get your estate. If you have surviving children or their descendants who are not the children or their descendants of your surviving spouse, these children and the descendants of any deceased child divide two-thirds of your estate and your spouse takes the rest.
If this isn’t how you want your estate to be distributed you need to execute a will.
A trust is a legal method that allows you to set aside some assets to benefit yourself, others or a charitable organization. Your beneficiary is the person or organization that benefits from the assets. You need to name a trustee, the person responsible for managing the assets and distributing it to the beneficiary or beneficiaries.
A trust could be created to help you and your spouse qualify for Medicaid so it can pay for your long term care instead of using your own assets. Through a trust your assets become property of the trust, created for your benefit so your assets can be reduced enough to qualify for Medicaid. There’s a five year “look back” period so these assets need to move into a trust at least five years before you apply for Medicaid or there will be substantial penalties.
The trust can be created and funded or it can be funded at a later date. Often a will lists a trust as a beneficiary, then the trust either distributes the assets or income or returns from the assets. As part of the probate process a will is filed with the Circuit Court where it becomes a public record. Those who want their assets or will to remain confidential often use this method.
Wills and Trusts Attorneys
We talk to our clients and take the time to understand their wants and needs before creating these planning documents so they’re the right fit for our clients. Using online, fill in the blank forms to create these documents can result in costly mistakes for you and your intended beneficiaries.
Cravens & Noll is here to help those in Central and Western Virginia with estate planning, including creating wills and trusts. If you or your family have any questions about them or want them created schedule an initial consultation today.