Estate Planning – The Critical Documents

by | Oct 17, 2022

What are the most critical documents to have drafted when developing an estate plan?

When you visit your attorney to create an estate plan it’s a good time think about all of the ‘loose ends’ that you can wrap up and include. You attorney should, at a minimum, offer you the Four Critical Documents that will allow your successors, heirs, and beneficiaries to use the estate plan to distribute your property according to you wishes with the least amount of delay and expense.

The Four Critical Documents

Every estate plan should include at least four critical documents:

  1. A Will;
  2. A Revocable (or Living ) Trust;
  3. A Durable Power of Attorney; and
  4. An Advanced Health Care Directive

However, in order to be a “complete” estate plan, I highly recommend several other documents to be drafted and signed at the same time.

Trust Certification / Trust Affidavit

A Trust Certification is a short legal document signed by the Trustee and the Notary that simply states the essential terms of the Trust. It also ‘certifies’ the Trust’s authority without revealing the private details of the Trust.

The Trust Certificate is used to provide proof of the Trust’s existence and structure for things like banking transactions. The purpose of the document is to provide reassurance to others that the Trust exists and is active.

    1. The Trust Certificate should include things like
    2. The legal name of the Trust
    3. The date the Trust was formed
    4. The names of the Trustees, and
    5. Sometimes includes the names of the successor trustees.

California has a specific Probate Code section addressing what items are appropriate for inclusion in a Certification of Trust. [Probate Code § 18100.5]

The Certification is signed by the Trustee (or Trustees) and their signatures should be notarized.

A Trust Affidavit is a similar document to the Trust Certification but (generally) contains less information.

Health Care Power of Attorney

In the event you are incapacitated, and cannot make health care or medical treatment decisions on your own, a Health Care Power of Attorney can be invaluable.

The Health Care Power of Attorney (HCPOA) is similar to a regular power of attorney; but, instead of granting someone legal authority to act for you, the HCPOA grants your agents the power to assist your physician or a hospital in making the best choices for you if you need medical care.

HIPAA Release

There are very strict federal and state laws limiting to whom a hospital or other medical provider can give out your personal health information.

The Health Insurance Portability and Accountability Act (HIPAA) limits use, disclosure, or release of individually identifiable health information. [45 CFR 164] California also has its own version, the California Confidentiality of Medical Information Act.

The purpose of this document is to give a physician or hospital legal permission to allow your agents to access your health care information. Very useful in the event that you are unconscious or otherwise incapacitated and need someone to help make decisions for you.

When I draft these releases, I usually name your designated agents and I include your attorney (usually myself) so that, in the event the release is questioned by a hospital I (or any other attorney) can intercede and try to get things moving on your behalf.

Living Will

My estate plans almost always include a Living Will.

A Living Will comes into effect to let your medical providers (and others) know of your wishes in the event that you become permanently incapacitated. The document is used if your doctors find that you are in a permanent vegetative state, in a coma, or have a terminal illness or incurable condition which might result in medical treatment to prolong your life.

Most of the time the Living Will is used to inform doctors and hospitals that you do not wish to continue living if your life is being prolonged artificially. They instruct the medical treatment providers to allow you to die naturally without unnecessary life-prolonging procedures.

While most of the Living Wills I draft allow the doctors to cease treatment; this is not the only option. Maybe you want to remain on life-support in the hope that you might eventually recover. Or maybe you want specific directions regarding what pain relief or nutrition you receive in the event you are in a coma. These documents are drafted specifically to your stated requests.

Other Documents

There are a number of other documents, such as a  that I typically include in estate plans that I draft.   I frequently include a “Personal Property Memorandum” to allow my clients to describe how they would like certain items of personal property distributed when they are gone.

My goal is to allow my clients to provide as much information as is reasonably possible to allow their successors, heirs, and beneficiaries to quickly and efficiently liquidate and distribute the Trust property when that time comes.

Please contact my office today if you need an Estate Plan, need to make changes in your current estate plan, or need to have additional documents drafted to support your estate.

High Net Worth Estate Planning

If you are “high net worth” individual (or family) then proper estate planning is even more critical.  My personal definition for a high net worth estate is one that exceeds the Federal Estate Tax limits.  If the value of your estate is over this limit, then the amount in excess of the limit is subject to Federal Estate Taxes.

According to Forbes, the 2022 Federal Estate Tax is charged against estates with a value greater than $12.06 million dollars.  However, this amount can change at any time.

If you are fortunate enough to anticipate problems with Federal estate taxes, then making the right choices can save your estate (and, ultimately, your beneficiaries) a significant amount of money.  Great care must be taken to ensure that all options available to your Beneficiaries and Trustees are utilized effectively.

What Do You Need?

In case you are looking for an attorney to assist you in creating a an estate plan, or you need someone to review the estate plan you already have, please contact the Law Offices of Geoff Wiggs and arrange a free consultation.

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