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Establishing a will or trust is one of the most valuable steps you can take toward ensuring your loved ones are taken care of when you are no longer with them. Unfortunately, asset distribution after death can get messy and lead to conflict between beneficiaries.  

KJK’s wealth and estate planning attorneys can help alleviate some of the burdens by drafting documents such as pour-over wills, revocable trusts and durable powers of attorney (POA) that ensure your assets are distributed according to your wishes.  

We assist a variety of clients in preparing estate plans ranging from basic estate plans to more complex plans for business-ownersand high-net-worth individuals. Whether you need assistance settling a loved one’s affairs or finalizing your own estate plan, the estate planning attorneys at KJK can lend a hand. 

Information to Know:

Estate & Trust Administration

Administering an estate or trust after a loved one has passed is a heavy burden during an already painful time. Executors of estates often hit roadblocks like creditor claims or familial disputes. Dealing with such issues on your own is time-consuming and stressful. 

If you have been named the executor of an estate, the lawyers at KJK can guide you through the distribution process and any arising conflicts. We are also available to provide professional trust administration.

Establishing a Will

Having a will in place allows you to decide where your assets will go once you are no longer here. A will enables you to name an executor to administer your estate once you pass. Likewise, you can designate specific beneficiaries to inherit your assets; these are often spouses or children.  

Having a well-drafted will is paramount for people with children, especially if those children are minors. A will allows you to appoint a legal guardian to look after your children in the event of an untimely death.  

While it may seem easy to draft your own will, the process is always best left to an experienced estate planning attorney who can provide sound counsel and make recommendations based on your wishes. In addition to traditional wills, if a trust is part of your estate plan the attorneys at KJK can help you draft a pour-over will that transfers any assets to an established trust. A pour-over will helps ensure your assets pass to your beneficiaries in the most private manner possible eliminating the need for a lengthy probate process. 

Trusts

A trust allows you to safeguard assets for specific beneficiaries. By placing assets into a trust, the you can specify when the beneficiary will receive the inheritance and under what circumstances. This is especially useful when the beneficiary is a minor, younger or cannot handle their finances independently.  

The type of  trust most often used is a revocable living trust, which you can alter or revoke during your lifetime but becomes irrevocable or unchangeable upon death. 

A trust can be contested for many of the same reasons as a will, including undue influence or lack of testamentary capacity. Beneficiaries can also claim that the trustee violated the terms of the trust, so it’s imperative to have a trust plan that protects you or your trustee from such claims. Our attorneys can help you draft appropriate trust documents to help minimize the chances of trust litigation. 

Probate

Wills are administered through probate, a process of confirming the will’s validity and administering the deceased person’s assets. It is also the process whereby a deceased person’s assets are distributed when they have no will. 

Although nothing stops you from taking on the probate process on your own, it is best to avoid doing so. Probate administration is a lengthy and stressful process. It’s also easy to overlook a key aspect, which can lead to complications later in time. Unforeseen circumstances that can complicate the probate process include: 

  • Incomplete plans
  • Unexpected creditor claims
  • Will contests
  • Representative contests
  • Tax liability

The attorneys at KJK can help expedite the process and make it less stressful and more efficient for everyone involved.

Things to Consider:

Power Of Attorney

A power of attorney (POA) allows you to appoint an individual to manage your estate should you become incapacitated. A power of attorney operates during your lifetime. We can assist you in preparing the following documents: 

Durable General Power of Attorney

A durable power of attorney allows you to designate an individual to handle your financial, business and legal matters if you are unable to do so yourself. This type of power of attorney is generally applied when a person is mentally or physically incapacitated and cannot manage their own affairs. A general power of attorney allows the specified individual to pay bills, manage assets and investments, and file tax returns, among other financial matters.  Most importantly, a durable power of attorney eliminates the need for a guardianship.

Health Care Power of Attorney and Living Will

A health care power of attorney allows you to name an individual to make health care decisions on your behalf, including giving and receiving medical information, hiring and firing healthcare workers, and selecting nursing homes. A healthcare power of attorney has agency over treatment options, including the ability to remove an individual from life support. Your living will allows you to delineate your healthcare wishes toward the end of your life. You can state your preferences on artificial life support and in what case to end treatment, including do not resuscitate orders (DNR) and feeding tube removal.  Having a healthcare power of attorney is critical to eliminate the need for a guardianship.

More than just a law firm:

Family Office Services

High-net-worth individuals need extra protection when planning their estate, as they are often the targets of creditor claims and lawsuits. We offer personalized family office services for such clients to help them shield as much of their wealth as possible while minimizing income, estate, gift and generation-skipping transfer taxes. 

We’re Here to Help:

Estate, Trust & Probate Litigation

Estate, trust and probate litigation usually involves resolving any disputes about the distribution of the decedent’s assets. It is not unheard of for people to demand changes to a will even after the person has passed. Sometimes, an individual may even try to have the will voided altogether. Luckily, there are steps you and your attorney can take to ensure that your estate plan remains intact even after you pass.

If you are involved in a conflict regarding the distribution of a loved one’s assets, you may very well have to take legal action. Attempting to resolve estate disputes privately is very difficult. The attorneys at KJK can help mediate your dispute or litigate when necessary to ensure you receive the inheritance to which you are entitled. 

Additional Information:

Frequently Asked Questions About Wills, Probate, and Trusts

Probate

What is probate?

Probate is a legal proceeding to administer certain kinds of property (called probate property) owned by someone who has died (the decedent), and to see that claims, expenses and taxes are properly paid, and that the remaining estate is distributed to those entitled to receive it under the decedent’s will or Ohio law.  

Why is probate necessary?

Probate is necessary to give the executor or administrator the legal authority to collect, control, safeguard and distribute the assets of the decedent’s estate. Probate also provides a process for the payment of outstanding debts, taxes and the expenses of administration, and for the distribution of the remainder of the estate to the beneficiaries and heirs according to the decedent’s will or under Ohio law governing intestate estates. 

What property is subject to probate?

Probate property consists of all property titled in the decedent’s name and not automatically transferable on death. It is distributed according to the terms of the decedent’s will or, if the decedent died without a will (intestate), according to Ohio law.

What is nonprobate property?

Property that is not probate property (“nonprobate property”), and therefore is not part of the probate proceeding overseen by the probate court, includes: property the decedent held as joint tenants with right of survivorship with another person (e.g., decedent’s surviving spouse); property held in a revocable or irrevocable trust; accounts that are payable on death (POD) or will transfer on death (TOD) to a named beneficiary; and insurance or retirement benefits (e.g., IRA’s or 401(k) plans) that are payable to a named beneficiary. Nonprobate property passes directly by operation of law to a named beneficiary, survivor or successor in interest, without the need for probate proceedings.  

Both probate property and nonprobate property may, however, be subject to federal estate taxes.  Ohio does not currently impose state estate tax on Ohio estates.

Where does the probate process take place?

A probate proceeding takes place in the probate court of the county in which the decedent lived. If the decedent also owned real estate in another state, additional proceedings (called ancillary proceedings) may be necessary in that state.

Who is responsible for managing the probate process?

Probating an estate requires that a person be appointed as the personal representative to conduct the administration of the estate. If there is a will, this person is usually named in the will and is called an executor. If there is no will or no person is named in the will, this person is appointed by the probate court and is called an administrator. The executor or administrator may be an individual, a bank or a trust company.

How much does probate cost?

There are many expenses involved in handling an estate.  Among them are: probate court fees, executor/administrator fees, appraisal fees, and attorney’s fees. Court costs are based on a fee schedule established by statute for each type of document filed in the Probate Court. Executor/administrator fees are also established by the state legislature and are based on percentages of the assets in the estate. These range from 1% to 4%, depending upon the nature and value of the assets. Where the value of an estate asset is not readily ascertainable, an appraiser must be appointed. Appraisers are often appointed to value real estate and are paid an appraiser fee as determined according to the rules of each county Probate Court. Most Courts tie attorney fees to the amount of time the attorney spends in dealing with estate matters. The costs assessed by the probate court (court costs) are based on a schedule of charges that the law has established for each type of document filed in the court. Costs typically range from $200 to $300. In most cases, the court must approve attorney fees charged for handling estate matters. Typically, attorney fees are based on an hourly rate for the actual services the attorney performs, or fees may be charged according to the probate court’s recommended fee schedule. The executor or administrator is entitled to receive a fee set by Ohio law, based on a percentage of the value of probate property and income, as well as the value of nonprobate property (excluding joint and survivorship property). An executor, administrator or an attorney may request additional fees for extraordinary services. Executor and administrator fees are taxable and frequently waived.

How long does probate take?

The average probate period ranges from seven months to 13 months. However, the process can take longer for complicated or contested estates.  Claims against the estate may be made up to six months from the date of death. A small estate that does not require the filing of a federal estate tax return and has no creditor issues often can be settled within six months of the appointment of the executor or administrator. However, if a federal estate tax return is required, the administration of the estate can last more than a year. (Estate taxes are not due until nine months after the decedent’s death.) If there is an audit of an estate tax return, the administration can take up to an additional year or more, and an executor or administrator cannot safely distribute all of the estate assets until released from personal liability for estate taxes after the audit has been completed. An extraordinary administration involving a contested will or probate litigation may take several years to complete. In many cases, however, distributions of most or all estate assets do not necessarily have to wait until all probate matters have been completed.  

Are all estates subject to the formal probate process?

If the total value of all property in the decedent’s probate estate is $35,000 or less, the estate can be relieved from some of these administrative requirements. Where the decedent’s spouse is entitled to receive all of the estate’s assets, the amount that can be relieved from formal administration is increased to $100,000. 

Do I need a will?

A properly drawn will assures you that, upon your death, your probate property will be distributed as you intended. A will is also the mechanism for choosing the executor and commonly provides for the nomination of a guardian where there are minor children. A will also can dispense with the requirement of a bond, for which an executor or administrator might otherwise have to pay. If you do not make a will, your probate property will be distributed according to Ohio laws under the Ohio Statute of Descent and Distribution. 

What are the responsibilities of the Executor or Administrator?

The executor or administrator of the estate is responsible for: 

  • Collecting and protecting the decedent’s property and assets; 
  • Receiving payments due the estate, including interest, dividends and other income; 
  • Collecting debts, claims and notes or other payments due the decedent; 
  • Determining the names and relationships of all the heirs to the decedent; 
  • Identifying all the decedent’s beneficiaries, if there is a will; 
  • Determining the validity of all claims properly filed against the estate and paying all outstanding debts and expenses; 
  • Preparing all relevant estate and income tax returns as required and making the required tax payments; 
  • Adhering to the instructions of the probate court pertaining to the estate and distributing the assets of the estate to the heirs.

The probate court oversees the work of the executor or administrator. This work may require the preparation and filing of probate documents, provision of notices to the heirs, attendance at court hearings, obtaining an appraisal for certain estate assets, filing of an asset inventory, completion of final income tax returns and possibly gift and estate tax returns, a final accounting of funds, transfer of all assets to beneficiaries, termination of the probate proceeding and discharge of the executor or administrator by the probate court. Because of the complexity of these procedures, it is recommended that an executor or administrator secure an attorney’s assistance. 

What is the Statute of Descent and Distribution?

The statute of descent and distribution, also known as the intestacy statute, is the law that defines how the probate assets in an intestate estate will be distributed to the decedent’s heirs after all claims, expenses and taxes have been paid.  Generally, the statute favors those heirs most closely related to the decedent.

Trust

Do I need a trust?

Yes, almost always yes.  Even a simple revocable trust offers many benefits, like avoiding the cost of probate.  But in our view, the most important benefit of a trust is to protect the beneficiaries – particularly kids – from:  themselves and others.  Without a trust, parents most valuable asset, usually the proceeds of a life insurance policy, retirement account, or a home will immediately go to a child on that child’s 18th birthday.  This is where protecting the children from themselves and others comes in.  Everyone can imagine how quickly an 18 year old might blow through a big chunk of cash (i.e., Vegas, substances, cars).  A revocable trust typically gives descendants an allowance for regular living expenses as determined by the trustee; then when the descendants reach certain ages, the trust permits the descendants to withdraw principal from the trust for any purpose.  This is usually done in tranches so that the descendants don’t blow all the money the first time they have access to a large sum of money.

Are my retirement accounts protected from creditors?

For the most part, yes.  All ERISA plans – like 401(k) and 403(b) plans, pension plans, SIMPLE IRAs, Simplified Employee Plans (SEP), employee stock ownership plans and profit-sharing plans – are fully protected from creditors in a bankruptcy, regardless of the dollar value. IRA accounts are protected up to $1,362,800.  College savings plans, aka 529 plans, are also up to maximum allowable contributions from creditor claims.  There are some exceptions to these, like divorce and child support.

If I die, how do I ensure a bad person doesn’t persuade my widow not to disinherit my children?

In its simplest form, a “QTIP” trust is designed to provide for a widow and then any remaining assets when the widow passes are supposed to go to the decedent’s children.  Another thing couples can do to protect their widows and descendants from bad actors is to appoint a “trust protector” to oversee the trustee (who is usually the widow).  This ensures that a bad actor doesn’t pressure the widow to spend money on the bad actor instead of the widow or descendants.

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