Estate Planning – Frequently Asked Questions

What is the purpose of making an estate plan?

The objectives of estate planning are to ensure that all of your assets are transferred to your chosen heirs, or beneficiaries, upon your death as at little cost as legally possible and to allow a selected family member or confidant to manage your assets and speak for you when you become unable to do so yourself.

Every one of us will depart when our time comes. When it happens, anyone we owe money to has the right to be paid. The judicial system – probate court – will see to it that anyone who comes forward with a legitimate claim is satisfied, including the taxman. These payments will come from whatever assets you leave behind. What is left after your debts are settled will be distributed to your heirs.

Having an estate plan gives you the opportunity to say who will be in charge of paying your debts and distributing your assets. It also gives you the opportunity to direct how you wish your assets to be distributed. You can direct, for example, who gets what property and what should or should not be sold to pay your debts. Other documents in an estate plan can dictate what medical care you wish to receive in case of a debilitating accident or illness and allow a designee to make decisions for you.

Absent an estate plan or will, a probate court judge will make the decisions about the distribution of your assets according to state laws of intestate succession. Your family members will have the opportunity to make their arguments for some decisions, but a judge will have final say.

What’s included in an estate plan?

What should be included in your estate plan depends somewhat on the complexity of your estate and family, as well as on your desires for the final disposition of your assets and your end-of-life medical care. Here are six basic estate planning documents:

• Will and trust. A will says how you want your assets distributed. You can give specific personal items or amounts of money to certain people. You can leave gifts to schools or charities. A trust can contain certain assets and allow them to pass in private to a beneficiary separately from the probate process. Some trusts help shield assets from estate taxes and probate fees.
• A durable power of attorney. This document allows a person or institution such as a law firm or accountant to act on your behalf if you are unable to do so. It spells out their authorities and when they assume the powers assigned. You may draft separate POAs with different designees to make financial decisions for you and to make decisions regarding your children’s welfare. If no one is designated as your power of attorney, a court may be left to decide issues that would be important to you.
• Healthcare POA and medical records authorization. A healthcare power of attorney designated by you makes medical decisions for you if you cannot. An authorization to access your medical records should be part of a medical POA. Medical personnel can only discuss your health records or care with people authorized by law.
• Living will. In addition to a healthcare power of attorney, it is wise to have a living will. A living will states your preferences regarding life-sustaining treatment in the event of a terminal illness/injury. If you have a healthcare POA and a living will (aka healthcare or advanced care directive), then you make your own medical decisions up until the point of incapacitation, at which point the POA takes effect. If you were to slip into a coma, the living will would then take effect ensuring your end-of-life decisions were honored.
• Guardianship designations. If you have minor children, you should appoint a potential guardian to raise them in the event you and your spouse die unexpectedly. This allows you to ensure that, if necessary, your children are taken in by an individual or couple who shares your values and is financially sound and enthusiastic about raising your children.

What is the role of an executor in estate planning?

An executor (also called a personal representative) is named in a will to carry out the wishes of the deceased person. It is an administrative task that must be executed according to state law. The executor must enter the will into probate, gather and develop an inventory of estate assets and their values, pay debts and distribute assets to designated beneficiaries. Each of these tasks has multiple steps. The executor is responsible for notifying beneficiaries of the estate of their status and responding to their questions about the distribution of estate assets. The executor is authorized to make decisions about selling assets to satisfy debts or as directed by the will or as necessary to ensure an equitable division of assets. If an executor mismanages estate funds and causes a loss for beneficiaries of the estate, the executor can be found personally liable.

What does an estate planning lawyer do for you after the death of your loved one?

As your estate planning attorneys, we would retain copies of all of your estate planning documents and have records of the individuals and/or institutions that need to be notified of your death for financial reasons. You should keep your estate planning attorney’s contact information with your copies of your estate plans. You should also advise the individual you have chosen to be executor of your estate that the documents exist and the name of your estate planning attorney’s law firm.

We can advise the executor of the estate or anyone with power of attorney over a recently deceased person’s estate about the probate court process. What is possible would depend on the types of assets in the estate and how they were to be transferred or bequeathed.

Our estate administration services include helping executors, administrators, trustees, and beneficiaries understand the roles they play in the probate process and protecting their rights. In particular, we work with those who have been left behind to help ensure that the estate’s affairs are handled, and assets are distributed, as the deceased would have wanted.

Brady Cobin Law Group provides estate litigation services, including will caveat actions to challenge the validity of wills and assist with guardianship appointments.

What’s the cost of estate planning?

The cost of estate planning varies according to which documents the client needs and the complexity of each document. As the value of your estate increases, so does the need to plan for its orderly transfer. If you have an extended family you want to provide for, your plans will be more complex.

A young couple with children should plan for their surviving spouse’s and children’s financial security in the event of a death. It might be enough to establish wills and a basic living trust and appoint guardians for minor children. A young couple also may establish a medical power of attorney so a close relative or friend can make medical care decisions for them if both become incapacitated.

An older couple with greater wealth and children from previous marriages should plan for wealth management and legacy planning. In addition to wills and powers of attorney, an older couple with assets may need multiple types of trusts and powers of appointment. Powers of appointment and other instruments available in an estate plan have various tax implications that we would examine and discuss with this type of client.

We offer a variety of payment options customized to the circumstances of each client, including fixed fees for some estate planning and administration services.

Are estate planning legal fees deductible?

No. The Tax Cut and Jobs Act of 2017 eliminated the ability to deduct estate planning fees from federal taxes. Even before the law changed, estate planning fees were only deductible to the extent that they represented income, gift, or estate tax planning or advice, not general estate planning fees for documents, filing.

However, many provisions of the Tax Cuts and Jobs Act will sunset at the end of 2025.

Contact a North Carolina Estate Planning Attorney

At the Brady Cobin Law Group, PLLC, we believe in thoughtful and thorough estate planning. If you have a family and/or personal property you would like to pass to someone else someday, you should at least have a will. Often it is a major life event, such as the birth of a child, that alerts people to the need for a more extensive estate plan.

We invite you to use our estate planning needs assessment calculator to consider your needs. Regardless of your circumstances, we’d be happy to help develop a plan that makes sense for you and your loved ones. Contact us today to get started.