Estate Planning

babyOur estate planning services include advice related to:

  • Wills;
  • Trusts;
  • Premarital agreements;
  • Incapacity planning;
  • Charitable giving;
  • Asset protection; and
  • Business succession.

At a minimum, everyone should execute a will, a durable (financial) power of attorney, and a health care power of attorney. Without these documents, the state government will determine who will make decisions for you if you are ever incapacitated and who will receive your property after you die. Few people would want this result, yet more than half of all Americans die without a will.

Not having these documents can:

  • Increase administrative and legal costs at your death, divorce, or incapacity;
  • Breed conflict within a family by leaving uncertainty or ambiguity; and
  • Cause unnecessary income, estate, or generation-skipping taxes to be owed at your death.

These results can often be avoided by executing some or all of the following documents:

Durable (Financial) Power of Attorney: This document will ensure that someone you trust can manage your financial affairs for you if you are ever unable to handle them yourself. If you ever become incapacitated and you have not executed a valid durable power of attorney, your family may have to spend significant funds and emotional energy petitioning the Probate Court to appoint a conservator for you. A durable power of attorney can help you avoid this financial and emotional cost.

Health Care Power of Attorney: By this document, you appoint a health care agent to make medical decisions for you if and only if you are incapable of making those decisions for yourself. Your health care agent is directed to act in accordance with your wishes, or if your wishes as to a particular matter are not known, in accordance with your best interests. You can also make your wishes know with respect to life support, thereby eliminating the need for a separate “living will.”

Will: By your last will and testament, you can:

  • Dispose of property held in your sole name (which is not otherwise subject to a beneficiary designation);
  • Establish trusts to hold property for beneficiaries who may not be ready to receive an inheritance outright;
  • Designate who you want to care for your children if you die while they are minors; and
  • Name a personal representative (i.e., “executor”) to administer your estate.

Revocable (Living) Trust: For clients wishing to reduce their potential transfer tax liability, enhance asset protection for their surviving spouse and children, and/or avoid probate with respect to some or all of their assets, they may use a revocable trust as the core estate planning document. While trust planning costs more up-front than simply using a will, it offers the following advantages:

  • Maintain privacy: If you do not wish for the general public to know who is receiving your property and upon what terms, using a revocable trust can help keep your estate plan private. If funded, you may also keep the nature and value of your assets from being disclosed publicly as part of the probate process.
  • Reduce court fees: Transferring assets into trust during your lifetime can help reduce the legal fees that are generally associated with probate and estate administration while also lowering the probate fee charged by the Court. In South Carolina, that fee is generally calculated as a percentage of your probate estate and is roughly $2,500 per $1,000,000 of probate assets. Even if you do not place all of your assets in trust during lifetime, you will avoid probate and the related fees with respect to the assets that you did transfer to your trust prior to your death.
  • Avoid delays in management: Because assets that you transfer into a revocable trust during lifetime will not be subject to the court-managed probate process at your death, your designated trustee can immediately begin managing your trust assets for your family and, when appropriate, can distribute them in accordance with the terms of your trust.

Premarital/Prenuptial Agreements: Divorce is a great destroyer of wealth. The required division of assets, the possibility of having to pay spousal support, and the high legal fees incident to the break-up can cause significant wealth to be transferred or lost. Instead of looking to the Family Court to dictate the terms of a break-up, it is often advisable to take matters into one’s own hands by deciding these issues prior to marriage. Additionally, a premarital agreement can be used to limit the right of a surviving spouse to take property from your estate against your wishes.

Other options: If you have advanced tax planning needs or strong charitable intent, other planning techniques that may be useful include:

  • Dynasty trusts;
  • Irrevocable life insurance trusts (“ILIT”);
  • Qualified personal residence trusts (“QPRT”);
  • Grantor retained annuity trusts (“GRAT”);
  • Self-settled asset protection trust;
  • Private foundation;
  • Charitable remainder trusts and charitable lead trusts; and
  • Family limited partnerships.