Wills, Trusts, & Estate Planning

Wills, trusts, and estate planning is one of my primary areas of practice. In recent decades, establishing a “revocable living trust” as a central component of estate planning has become the norm in preparing for one’s elder years and safe-guarding the future of loved ones. An accompanying “pour-over will” funnels assets not already held by the trust into it after death. A revocable living trust can be an important part of planning for incapacity as well. We tend to be living longer and there are thus also frequently late life incapacity issues to address.

Revocable Living Trusts

The “trustor” (the person who has created the trust) typically serves also as “trustee” of the trust until he or she no longer able to do so. A revocable living trust can then enable designated “successor trustee(s)”, usually the spouse, adult children, or trusted siblings, to access trust assets during periods of the trustor’s long-term or temporary incapacity and use these for the care of the trustor. After the trustor’s death, a revocable living trust allows assets to be distributed to beneficiaries without the necessity for a court probate proceeding. Revocable living trusts also usually contain  provisions for funds left to children to be held for them in the trust until they reach a designated age or ages. Until that time, amounts from the trust are distributed to them by the trustee on an “as needed” basis. The “simple will” is still an option, but the revocable living trust is now usually perceived as offering more benefits.

Assets passed on to beneficiaries via beneficiary designations pertaining to a particular assets, for example life insurance proceeds, retirement accounts, and POD (Payable on Death) accounts, are not usually held by the revocable living trust or conveyed into the trust under the terms of the “pour-over will”. After death, these assets are thus not distributed under the terms of the trust. It is therefore important that trust provisions and such beneficiary designations are well-integrated to achieve the desired outcome for beneficiaries.

Key Positions & Documents

I work with clients on their choices regarding individuals who will be named to crucial key positions including successor trustee(s), personal representative(s) (the Oregon term for executor of the will), holder(s) of the power of attorney, guardians and conservators for children, and designated health care representative, along with the order in which these persons are named. All assets are inventoried and reviewed as part of arriving at a sound plan regarding to whom, and how, these assets will be passed on. The typical set of documents I prepare for clients includes the revocable living trust, pour-over will, power of attorney, designation of guardian and conservator for children or for seniors, Oregon Advance Health Care Directive, and deeds and assignments conveying real property and/or business interests into the trust.

Three Meeting Sequence

This usually involves three meetings with clients over approximately three to four weeks. At our initial discussion, fundamentals of wills, trusts, and estate planning are explained and initial decisions are explored and tentatively made. Who will receive especially valued items of personal property and even how pets will be cared for are often encompassed along with specifics regarding funeral and burial arrangements, and other “final requests”. Between our first and second meetings, clients have time to reflect on and finalize their choices and arrive at the soundest possible decisions. This interlude also gives clients an opportunity to ask further questions and have them fully answered.

In our second meeting, we review document drafts and amend these if desired. I “walk through” all documents I have prepared with clients and explain especially all of the most important sections. I do not believe in putting documents in front of a client to sign that they do not fully understand. Our third meeting is for the signing and provides a further opportunity for any remaining questions to be answered. In addition, steps the client will need to take to transfer assets, such as bank and investment accounts, into their revocable living trust are reviewed in detail at this time.

Tax Planning

In Oregon, personal estates with total assets of over $1 million are generally subject to the Oregon Estate Transfer Tax. For such estates, this tax can be very substantial. The law provides, however, for strategies by which it can be minimized or eliminated. For married couples, this usually involves retaining all or part of the assets, up to $1 million, of the first spouse to pass on in their revocable living trust (the terms of which become permanently fixed and irrevocable following their death) for use by the surviving spouse for their needs during the remainder of the surviving spouse’s lifetime. Such assets continue to be regarded, however, as part of the estate of the first spouse to pass on rather than becoming merged into the estate of the surviving spouse. By this means, the total exemption from the Oregon Estate Transfer Tax is increased to $2 million for a married couple who have created and used the trust structures necessary to achieve this outcome.

Role of Gifting

In Oregon, pre-death gifting of assets is also an important means of estate planning and tax reduction. Such gifts can be made directly to an individual or to an irrevocable trust created for the benefit of others, such as for children. Advance gifting of interests in a family business to family members can also achieve substantial Oregon Estate Transfer Tax savings. Questions of how future ownership interests in a family business are structured to optimize the future success of that business are often also addressed. Irrevocable life insurance trusts can yield proceeds that are not deemed to be part of the taxable estate of a decedent. Federal Estate Taxes are, at present, levied on personal estates of over $5 million. If applicable, this can result in further steps to achieve tax reduction.

Addressing Additional Needs

If there are beneficiaries with serious disabilities, a “special needs trust” can provide funds to be used for their well-being without cutting off public support. In “blended families”, trust structures can provide income for a surviving spouse during his or her lifetime and then subsequently, upon the passing of the surviving spouse, leaving the trust principal to the trustor’s own children. For couples approaching marriage, a sound pre-nuptial agreement can be valuable. No two families are, of course, exactly the same. I believe in taking the time to fully understand the needs and wishes of each family and each client and customizing trust structures and provisions as needed to achieve the desired results. I also believe in keeping my fees and costs as reasonable and affordable as possible for all clients. My wills, trusts, and estate planning work is usually done on a “flat fee” basis, agreed upon during our initial meeting, so that you will know in advance exactly what the total cost will be.

How Can We Help?

Call 503.335.1406 or click to send an e-mail:

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  • Wills
  • Revocable Living Trusts
  • Irrevocable Trusts
  • Estate Planning Counseling
  • Special Needs Trusts
  • Business Succession Planning
  • Wealth Transfer
  • Probate
  • Trust Administration
  • Family Limited Partnerships
  • Prenuptial Agreements
  • Deeds
  • Powers of Attorney & Advance Directives
  • Small Estate Administration
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