Typically, most individuals seek to have the most basic estate planning documents n place to help see to the orderly management of their affairs and ultimately the transfer of their wealth to their intended beneficiaries upon their passing. Among those instruments are the following:
• Last Will and Testament
The primary intent of a will is the disposition of one’s property by stated devise of personal and/or real property. The will typically provides for the payment out of the estate of all just debts and expenses, including any estate or death taxes that may be due, and the nomination of guardians, conservators or property custodians if the decedent has a minor child or one is named as a beneficiary under the will. A more sophisticated will may be designed to provide for the establishment of one or more trusts, or may direct the “pourover” of assets to a trust established prior to death. Wills are often revised or written during one’s lifetime to accommodate changes in assets, circumstances or beneficiaries.
• Health Care Proxy
This legal document appoints one or more individuals, granting them the authority to make medical or health decisions for you at a time when such decisions are needed and you are physically unable or otherwise lack the capacity to communicate or make those decisions for yourself. The proxy is amendable and revocable, such that your nominated proxies can be changed as long as you are mentally competent to make those voluntary changes.
• Durable General Power of Attorney
This document appoints one or more individuals with specific authority and powers typically intended to allow the appointed individual to “step into your shoes” and attend to legal, financial, business and property affairs when you are incapacitated or otherwise unable to make those decisions for yourself or simply need help in accomplishing those tasks. Establishing this authority in advance relieves the individual or family from the time and financial burdens associated with a court-appointed guardianship or conservatorship, which essentially accomplishes the same end-goals. These powers are amendable and revocable, such that nominated “attorneys in fact” can be changed as long as you are mentally competent to voluntarily make those changes.
• HIPAA Release
Under the Health Insurance Portability and Accountability Act (HIPAA), individuals are ensured the privacy of certain protected health information in the custody of most physicians, hospitals and other medical treatment facilities. Under Massachusetts law, a “health care agent” under a health care proxy is, in most instances, treated as the individual he or she represents with regard to such records and cannot be denied access. However, expectations do exist which may allow the facility to deny such access. In such cases, or if a valid health care proxy is not in force, the HIPAA Release should provide access to those records.
• Living Will
A living will, often referred to as a “health-care directive” is a document containing an individual’s expression of intent with regard to the question of the use, or continued use, of extraordinary medical measures (typically life support methods) where an individual has been pronounced as “brain dead”, or is in a persistent vegetative state. While not specifically recognized under Massachusetts law, these documents may allow a court a glimpse at the individual’s personal opinions and wishes about the continued use of such measures. Such a document may also be useful if a decision-making episode arises while the individual is in another jurisdiction that recognizes such an instrument.
A trust is an instrument that calls for the transfer of title to property from the creator of the trust to the trustee who assumes a fiduciary relationship with respect to the property and agrees to manage the property for the benefit of specified beneficiaries. The trustee is required to follow the terms of the trust through the authority and powers granted to the trustee either under the document or by law. There exists a myriad of different type trusts and purposes for which they are created. There are lifetime or testamentary trusts, revocable or irrevocable trusts, trusts for life insurance, trusts for personal residences, trusts for the benefit of individuals with special needs, trusts to ease the conveyance of real estate, trusts to avoid probate, trusts to limit or eliminate estate taxes, trusts for the lifetime transfer of property without gift tax consequences, trusts to benefit charities, trusts to protect assets, trusts to preserve a set amount of assets for a specific group of people for as long as possible, and so on. Whether or not any trust will work for you will typically depend on your particular set of circumstances, your asset holdings, and your goals and intentions.
If you do not have these important documents in place or if you do but are thinking of making some revisions, be sure to consult qualified counsel with experience in explaining and advising you as to what legal instruments and strategies may best fit your goals and requirements.
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