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Clients trust you as an estate planning attorney to manage their most valuable assets. But sometimes, things aren’t as easy as they should be. It’s not uncommon for estate planning attorneys to encounter issues along the way, including disgruntled heirs or disinherited family members. How can you ensure the client’s wants are honored? Look no further because we have the most important ways to ensure your client will withstand any legal challenges.
Properly executed will
Double, triple, quadruple check. If any aspect of the will isn’t completed or correct, the court could determine how your client’s assets are handled after their death. Proper execution will ensure your client’s wishes are carried out, help avoid any family disputes, and save loved ones time, money, and energy.
Some things that can invalidate a will include:
- Not being signed by the testator (person making the will)
- Not signed by two witnesses
- Not being dated
- Made under duress or undue influence
- Made by a person who is not competent to make a will
Put beneficiaries in writing
Estate planning attorneys need clients to see how important beneficiary forms are. In a Forbes article, financial planner Jeffrey Levine noted that a will often covers an individual’s personal property, such as jewelry and other possessions. It does not, however, cover real property, bank accounts, or retirement savings. “A will only controls assets that pass through the probate estate,” Levine said, “but many assets avoid probate altogether and pass by contract or operation of law.” With this in mind, IRAs, Roth IRAs, and 401 (k) accounts should all have beneficiary forms. The forms generally supersede a will, he said, “even if it clearly states you hate John and want all your assets to go to Jane.”
Consider a no-contest clause
Here is another tool estate planning attorneys can use to shield their clients’ assets: a no-contest clause. Sometimes called a “penalty clause,” it is designed to limit the beneficiary’s ability to challenge the will. If this clause is present, a beneficiary who unsuccessfully challenges a will in court will likely lose his or her inheritance. However, this process can vary by state. Some may not enforce no-contest clauses.
Create a living trust
A third option to protect your client and their assets is to create a living trust. A living trust is created while the person is alive and becomes an enforceable document. Generally, the will pushes the assets to the revocable or irrevocable trust. Any assets in the person’s name go directly into the estate, and the executor is responsible for handling the assets and handing them over to the trustee.
There are many benefits to a living trust:
- Reduce estate taxes
- Protect minor children
- Support disabled or irresponsible children
- Keep assets within the family
- Avoid Probate
A trust can address various estate planning issues that cannot be tackled in a will. Plus, your client can manage their assets and protect them in the event they become injured, ill, or disabled.
Know the law
State laws on wills and trusts differ from state to state, including estate and inheritance taxes, children’s inheritance rights, spouses’ property rights, and more.
When clients move or make two states home, it can complicate their plans, and they must be re-examined. Legally your clients are not required to have two estate planning documents for each state they live in. However, it’s crucial to ensure each state’s legalities are considered and understood to avoid complications in legal challenges.
As an estate planning attorney, your clients rely on your knowledge and expertise to make the most of their life’s assets. Depending on the situation, one or more courses of action identified here may be appropriate. The only way to know for certain is to ask your clients. If you have not discussed any of these scenarios with them, you have a perfect reason to initiate a conversation.