Commonly Asked Questions

What is Probate?

Probate is a court process that looks after people who cannot make their own personal, health care and financial decisions. These people fall into three general categories: Minor Children (under age 18 in most states); Incapacitated Adults; and People who have died without legal arrangements to avoid probate. Probate proceedings are expensive (4% to 5% of your gross estate) and time-consuming (1 ½ to 2 ½ years after your death). For example, if your home is worth $200,000, your probate fees would be over $10,000! Additionally, the court proceeding and associated documents are all a matter of public record. Many people choose to avoid probate to save money, spare their heirs a legal hassle, and keep their personal affairs private.

What Causes Probate and Conservatorships?

Generally, it is the need for a signature. Certain types of assets can be transferred only after the owner signs documents at the time the transfer or loan is made. A home is an example of this type of asset. A person is unable to sign the necessary documents after his or her death or after becoming incompetent. The solution is the court proceeding called Probate if the person has died or Conservatorship of the person is alive but legally incompetent. The court proceeding results in a court order that takes the place of the needed signature. However, in a Living Trust, signature authority is held by the Trustee of the Trust. If the original Trustee dies or becomes incompetent, there is a pre-designated Successor Trustee available to provide the needed signatures, thus avoiding the need to have a Probate or Conservatorship proceeding.

What is Joint Tenancy With Rights of Survivorship?

This is the most common form of asset ownership between spouses. Joint tenancy (or TBE) has the advantage of avoiding probate at the death of the first spouse. However, the surviving spouse should not add the names of other relatives to their assets. Doing so may subject their assets to loss through the debts, bankruptcies, divorces and/or lawsuits of any additional joint tenants. Joint tenancy also doubles your chances of a guardianship or conservatorship and can result in your heirs being subject to double estate taxes on the estate of a married couple.

What is a Will?

First of all, Wills do not avoid probate. A will is a document a person signs to provide for the orderly disposition of assets after death. Wills have no legal authority until the willmaker dies and the original will is delivered to the Probate Court. Still, everyone with minor children needs a will. It is the only way to appoint the new "parent" of an orphaned child. Additionally, assets can be arranged and coordinated with provisions of a testamentary trust to avoid estate taxes.

What is a Living Will?

It is a legal document that would have saved Terry Schiavo’s family a lot of headaches. Sometimes called a Directive to Physicians or a Health Care Directive, a living will is not a will at all. In fact, it allows you to state your wishes in advance regarding what types of medical life support measures you prefer to have, or have withheld/withdrawn if you are in a terminal condition (without reasonable hope of recovery) and cannot express your wishes yourself. Oftentimes a living will is executed along with a Power of Attorney for Health Care, or a Health Care Proxy, which gives someone legal authority to make your health care decisions when you are unable to do so yourself.

What does Intestacy mean?

If you die without even a Will (intestate), the legislature of your state has already determined who gets your assets and when they get them. You may not agree with their plan, but roughly 70 percent of Americans fall into this category.

What are Durable Powers of Attorney and when do I need one?

These allow you to appoint someone you know and trust to make your personal health care and financial decisions when you cannot. If you are incapacitated without these legal documents, you and your family will be involved in a probate proceeding known as a guardianship and conservatorship. This is the costly and embarrassing court proceeding where a judge determines who should make these decisions for you under the ongoing supervision of the court.

What is a Living Trust?

It is a private agreement between the Trustor (you) the Trustee (you or whomever you name) and the beneficiaries (you and whomever you name after your death) that controls your assets as you direct. Think of it as an invisible piggy bank that you control and that can last after you pass away to control who gets your assets and even what they do with them after you’re gone.

Can I Change a Living Trust? Yes.

The trust has language that gives you the power to amend, revise and even cancel it while you are alive and legally competent.

Why Have a Living Trust?

The two main reasons are to avoid the expense, delays and embarrassment of Probate and Conservatorship. A third reason applies to married couples. For them, a Living Trust can allow you to double the amount you can leave to your heirs estate tax free.

What is “Funding” a Trust?

“Funding” your trust describes the process of changing the title of each asset from yourself as an individual to yourself as Trustee of your trust. Most of your major assets have some sort of paperwork that gives evidence that you own them. An example would be a real estate deed. After you sign and date your trust, you need to change the title of each asset of this type. THIS IS VERY IMPORTANT! It is the secret trick that is the key to avoiding Probate and Conservatorship. In most cases, I will prepare the documentation to change the title on your Massachusetts property. You will get a set of funding instructions to follow in changing the title of your other assets.

Why is the Trust So Wordy?

Trusts have lots of words because no one knows what will happen to you in the future. The trust tries to cover as many situations as possible so you will not be lacking anything when the time for whatever comes. Most of the words are there for a good reason and reflect the highest professional standards in the drafting of legal documents. Many of the words may never apply to you, but the important point is, they could.