You may not have gotten around to creating your estate plan yet, but hopefully you know how important inheritance planning is to you and your loved ones. If you have decided that now is the time to get started with your plan, you will need to ask yourself some important questions related to inheritance planning first.
- Who will be the Executor in your Last Will and Testament? People often make the mistake of simply appointing a spouse/adult child/parent as the Executor of their Will without giving the matter any thought. The job of Executor, however, requires a good deal of financial and legal knowledge and experience as well as a time commitment in order to do the job right. As such, you should be careful who you appoint as your Executor.
- Do you want to waive the bond requirement for your Executor? When someone serves as the Executor of your estate the individual may be required to post a bond by the court. The bond protects the estate from any mismanagement or intentional misconduct by the Executor. As the Testator, however, you have the option to waive the bond requirement.
- Do you want to make any specific bequests? Do you have family heirlooms or other assets that you wish to leave as direct gifts to family members or loved ones? If so, you should make a list of those items and the intended recipients.
- Who will your beneficiaries be? While most of your beneficiaries may be easy to name, once you sit down and think about it you may find there are more than you originally thought. Making a list ensures that no one is forgotten and makes it easier to make decisions regarding the disposition of your estate assets.
- How will you distribute the rest of your estate? Once you have made all the specific bequests you intend to make, the residue of your estate can be gifted in specific dollar amounts or divided proportionately. For example, if your remaining estate is valued at $100,000, you might give $50,000 to one beneficiary and then give $10,000 gifts to an additional five beneficiaries of your choosing. You might also prefer to simply divide your estate with one half to a beneficiary and the remainder to be divided equally among several other beneficiaries.
- Do you want to make any charitable gifts? Gifting to charity can be accomplished in a number of ways, some of which may benefit you while you are alive and/or benefit your estate with regard to taxes your estate might owe. Be sure to let your estate planning attorney know if you plan to make any charitable gifts.
- If you have minor children, who will you appoint as their Guardian? Your Will is the only opportunity you have to tell a judge who you would appoint as the Guardian for your minor children if one is ever needed.
- What other estate planning documents might you need to protect your children? A minor child cannot inherit directly from your estate. Therefore, if you plan to leave assets to provide for a minor child you will need to decide who you wish to manage those assets and how you wish to leave them in your estate plan. Most people choose to create a testamentary trust that will activate in the event of your death. The person you appoint as Trustee of the trust will then manage the assets until your child reaches the age of majority.
- Do you want to include a No Contest clause? A “No contest clause” is a provision in your Will that can prevent someone from inheriting at all from your Will if he/she chooses to challenge the validity of your Will. States differ considerable in if/how they enforce these clauses so be sure to consult with your estate planning attorney if you wish to include a no contest clause.
- Who should have a copy of your Will? Your estate planning attorney should retain a copy of your Last Will and Testament as should your Executor. Beyond that, it is up to you to decide who receives a copy.
Who should have a copy of your Will? Your estate planning attorney should retain a copy of your Last Will and Testament as should your Executor. Beyond that, it is up to you to decide who receives a copy.
If you have additional questions or concerns about inheritance planning in the State of Illinois, contact the experienced Illinois estate planning attorneys at Nash Bean Ford & Brown, LLP by calling 309-944-2188 to schedule your appointment today.