"Probate" is simply the legal process by which an estate is administered. A will is "probated," and the assets that pass through the will are probated. There is a probate tax (not to be confused with estate tax) levied upon all assets that are probated. For sizeable or complex estates, we can handle all of the estate administration and probate matters, taking the burden off of the Executor or Administrator on a flat fee basis, which is explained and agreed to in advance, to assist them in administering the estate, preparing the preliminary inventory, application for letters testamentary, publication of notice to creditors, 90- day inventory, annual and final inventories, etc.
Trusts Used to Avoid Probate
Trusts are often used for a variety of reasons, since they are recognized as a separate legal "person." Many of our senior clients prefer to set up a revocable trust (a form of "living" trust, or inter-vivos trust), and place their assets in it, in order to avoid the time and expense of probate. For many of our younger clients, or clients with moderate to larger estates, estate tax planning considerations overshadow the importance of probate avoidance. All trusts are not alike; trusts set up to avoid probate can be quite different in focus than those set up to avoid estate taxes.
Trusts & Estate Planning
Estate taxes become an issue whenever the total estate, including life insurance at its face value, retirement plans, stocks and investments, real estate, and all other assets, exceeds $2,000,000, which is the amount currently exempted by the unified credit. At the basic estate planning level, trusts are used to shelter an additional unified credit for both the husband and wife, leaving the children or other beneficiaries with $4,000,000 tax free. These are called "credit shelter" trusts, which are known by a variety of names (all variations on the same theme), such as A-B trusts, bypass trusts, and family trusts. We can help design a plan which is right for you.
- Advanced Estate Planning
Our philosophy is to keep the plan as simple as possible, but at the same time to accomplish your tax-saving objectives. However, for those clients with larger estates who need more sophisticated estate planning, we can draft Irrevocable Life Insurance Trusts (ILIT's), Family Limited Partnerships, Charitable Remainder Trusts, as well as other advanced trusts and estate planning documents, and provide thorough explanations as to how these instruments can be helpful to you. We also can explain and implement various gifting and Charitable Trust options that are available. Please call us to discuss your needs with one of our estate planning attorneys.
References
While Gorman & Associates does not release the identities of our will, estate planning, and estate administration clients, we do receive referrals from a number of trust companies, estate planning professionals, stock brokers, and financial advisors. Individuals have referred us their clients from, and we can provide references from, the following organizations:
Ameriprise Financial Advisors; Branch Banking & Trust Company (BB&T); Northwestern Mutual Life Insurance Company; Wachovia Private Financial Advisors; Wachovia Securities; Bank of America Securities; Merrill Lynch; and UBS Paine Webber.
