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Tips for Choosing an Executor of a Will

It can be scary to think about who will take care of your family and your assets after your death. That is why picking the right executor for your Will can be so important. The executor is the person you will name in your Will to administer your estate after your death. You’ll want someone you can trust to follow out your wishes and obey the laws of your state. Here are a few things to keep in mind when picking the executor that is right for you:

CHARACTERISTICS OF A GOOD EXECUTOR

Serving as the executor of Will carries a lot of responsibility, and you’ll want to make sure the person you choose is up to the task. Before you choose someone, consider the characteristics of a successful executor:

  • Honest
  • Responsible
  • Well-organized
  • Patient
  • Punctual
  • Good at communication

You may also want to consider the executor’s proximity to the estate’s assets. For example, if you live in Arizona but your executor lives in Alaska, it may be difficult for the appointed person to appear in court, check mail, maintain properties, etc.

WHO NOT TO CHOOSE AS YOUR EXECUTOR

You can pretty much name any you want, with a few exceptions. Each state is different, but in general, courts may not allow the following to be appointed as executor of your will:

  • Children under the age of 18
  • Felons
  • Out-of-state executors, unless they are also a primary beneficiary

Check your state’s laws, or ask an attorney, like an estate planning attorney Phoenix, AZ relies on, before appointing an executor to make sure they are qualified to serve.

WHO TO CHOOSE AS YOUR EXECUTOR

The person you choose isn’t required to have expertise in the law or finances, though it may certainly help. Usually, people will choose a close family member to serve as their executor. Common choices include:

  • Spouse
  • Children
  • Siblings
  • Parents
  • Close friends

Before you assume that someone will serve as executor, be sure to ask for them first. You may even want to inform them of what the job entails and see if they feel up to the task. If they agree, make sure you notify them on the important details of your estate plan, including financial information and the location where the Will is kept. You can even provide them with a copy of the Will before your death, so that they’ll be best prepared when the day comes.

PROFESSIONAL FIDUCIARY OPTIONS

Many people choose a third-party institution, like a bank, law firm, or professional fiduciary company to serve as the executor of their estate. There are many good reasons to do so, especially if you don’t have any family or friends that you trust or want to avoid any potential family squabbles. These third-party institutions are experts in dealing with estates and can offer a non-biased, by-the-book execution of your estate. Beware that third-party executors will administer your estate at a fee set by the state.

 


 

Thanks to our friends and contributors from Kamper Estrada, LLP for their insight into choosing an executor of a will.

Per Stirpes vs. Per Capita Distribution…

Per Stirpes vs. Per Capita Distribution in a Will

                One of the obvious benefits of having a will is you get to name the beneficiaries of your estate.  When I sit down as an estate planning lawyer St. Peters to meet people, they almost always have an idea of who is going to be their beneficiaries.

However, one thing that they often struggle to decide is how to divide their estate if one or more of their beneficiaries die before they do.

There are two options.  The first is called “per stirpes” distribution and it means that if a beneficiary predeceases, their share goes to their survivors equally.  The other option is called “per capita” distribution and it means that if a named beneficiary predeceases their share is then split only between the other name beneficiaries.

Let’s look at an example:

Sam and Sally have three children, Samuel, Sarah and Samantha.  They each create wills that leave everything to the other spouse and then to the children in equal 1/3 shares, per stirpes. Sam passes away and then Sarah passes away five years later.  Five years after that Sally dies.  Her will controls the distribution of her estate and because she chose per stirpes distribution, Samuel will get 1/3, Samantha will get 1/3 and Sarah’s two children, will each split Sarah’s 1/3 share and each will get 1/6.

With a per capita distribution scheme, under the same example Sarah’s 1/3 would be split between her brother Samuel and sister Samantha.  Sarah’s children would therefore receive nothing and Samuel and Samantha would each split the estate, ½ each.

You can see how the slightest change in one word (“stirpes” or “capita”) can result in a big change.  Therefore, when I counsel clients I discuss these different options thoroughly and ask about their relationship with grandchildren, the health of their children and any potential problems that could develop within the family (which we want to avoid) if one scheme is chosen over the others.

There’s not really a right or wrong way to choose which distribution you want in your will or living trust.  Based on my years of practice, I would say per stirpes is the choice of 90% of clients over per capita.  Most people think that’s the fairest way and are concerned about beneficiaries getting more due to someone else’s death.

On the other hand, per capita can be a better choice if we’re worried about a distribution to grandchildren going to an unpopular daughter or son-in-law.  That can happen when the distribution is made to the grandchild but taken improperly or used unnecessarily by their mother or father.  That’s something to consider if you find yourself with an in-law that you don’t like.

In the end, careful consideration of all circumstances and preferences has to be examined and peace of mind is ultimately the goal with any estate plan.

 

What is Trust Litigation?

Estate Planning Law FirmGenerally, there are two types of trusts that are subject to disputes. First, are “inter vivos” or “living trusts” which are created by an individual during his or her lifetime. Second, are “testamentary trusts” which are trusts which are created or funded after an individual’s death. For purposes of this article about trust litigation, we are going to treat both types of trusts the same.

Trust litigation may attack the validity and legality of the trust. In this type of dispute, a person or an interested company attempt to have the entire trust agreement declared null and void. The legitimacy of a trust agreement can be attacked in a variety of manners. In some scenarios, heirs or other family members may argue that a trust was created by fraud or that the signature on the trust agreement is a forgery.

Interested parties might argue that the trust agreement was invalid because the grantor, or the creator of the trust, did not have legal capacity to sign the agreement. Legal capacity is often disputed when a creator of a trust agreement is ill or disabled when the trust agreement was signed. Similarly, “undue influence” is an argument used to attack a trust. Parties attacking the legality of the trust argue that the creator of the trust was inappropriately influenced by an individual to sign the trust.

Frequently, the beneficiaries of a trust do not want to attack the validity of the trust. However, disputes arise when the Trustee does not properly perform his or her duties. A trustee owes a heightened duty to the beneficiaries. Additionally, the trust agreement and state laws require the Trustee to create an annual account for the trust beneficiaries. The annual account must show the total assets of the trust, any income the trust received, and all payments that were made by the trust. The failure of the Trustee to comply with his or her obligations regularly leads to litigation. Claims for breach of fiduciary duty and for a formal accounting may be filed with a court by the trust beneficiaries.

Trust litigation is often complex, as the trust agreement is governed by very specific terms in the document and also by state and federal laws. It is also important to note that parties to a trust lawsuit generally do not have right to a jury. The disputes are brought before a judge who presides over the trial. The judge is also the decision-maker in the trial.

Contact Chicago Attorney Andrew Hays With Questions About Trust Litigation

Andrew Hays and his legal team at Hays Firm LLC in Chicago are knowledgeable trust litigation attorneys who have a great deal of experience with helping individuals through the process of challenging the will of a loved one and ensuring that their loved one’s true wishes were carried out. Please contact us to talk about how we can help.

 

Update: The Estate of Prince, Two Years Later…

Update: The Estate of Prince, Two Years Later…

 

UPDATE:  THE ESTATE OF PRINCE, TWO YEARS LATER

The world mourned the death of Prince on April 21, 2016.  After the initial shock of his death, apparently from a drug overdose, passed, his estate became a central issue with his surviving relatives.

Right after his death, I wrote that his probate estate would be a mess:

https://www.legacylawmissouri.com/prince-died-what-about-estate/

Unfortunately, I was right.

First, none of his heirs have received a dime from the probate estate.  That’s in part because Prince had not even created a will, which complicated things initially because hundreds of people came out of the woodwork claiming to be related to the singer.

Since then, it has been determined that his six surviving siblings will share equally in his estate.  However, there’s an ongoing issue:  The executor of his estate and the IRS cannot agree on what the estate is worth.  Until they do, nothing can be distributed to the siblings.

So who is getting paid from the estate?  The executor and their lawyers have collected $5.9 million in fees and expenses.  They’ve requested additional fees already and more are obviously expected after that.

A rich celebrity like Prince should have had a will at the very least.  That was either a failure of him to follow advice from what you can only imagine was a team of managers, lawyers and accountants or, less likely, the advice was never given to him by his team which would be incredible incompetence.

Had Prince created a will, the beneficiaries of that will would have been determined right away.   The process would definitely be further along and likely the will would have contained terms regarding the assets of his estate and directions to the executor.

Had Prince created a properly funded living trust St. Peters (or series of trusts more likely) he could have avoided probate all together and his estate would be resolved in private.  It would be a quicker process and a much cheaper one.

And likely his heirs would already be spending their inheritance.

Estate Planning and Intellectual Property

Many people don’t start planning their estate documents and estate plan until later in their life, as an estate planning lawyer State College, PA trusts can explain. Even if they do, they mainly focus on who will inherit tangible assets, including land, money, houses, stock, investments, and jewelry. However, intangible assets are usually not considered, including inventions, brands, works of authorship, and trade secrets. Many people do not think they have intangible assets, but today most people use social media and the internet, which allow them to write on a multitude of platforms daily. As a step of the process of estate planning, you should also identify your intellectual property.

What is an intangible asset?

An intangible asset comes from your mind being creative. Inventions, works of authorship, trade secrets, and brands are created by our creativity and intelligence. Not everyone is going to be a famous singer, author, inventor, or musician, but you may still have some rights to intellectual property.

Copyright law protects works of authorship. You could be an author of books, website content, articles, or sheet music. Other people could create software codes, paintings, photographs, drawings, sound recordings, or videos. For an author, having a copyright law will last the life of an author plus seventy years. Most people also use social media every day. There will need to be decisions made for what should take place to all the social media content when they die. You will need to review the terms of service of the social media platform to understand the applicable rights. It does not matter if the content has value, it will need to be decided if the deceased’s account will close or stay open after death.

Trade secrets offer protection for any information that someone would keep secret. Trade secrets would include the recipe for a restaurant’s special chicken or the formula to create a famous soda. These formulas and recipes are very valuable. However, even a small local shop’s owner could have a trade secret in the form of a recipe for a unique pizza sauce or a special recipe for a dessert. Trade secrets do not expire as long as they are kept secret.

Patent law protects inventions. The next generation may inherit the right to exclude others from creating or distributing services and products under the invention. Patent rights last for roughly twenty years for the plant and utility patent. Fees for maintenance are due every so often so that the patent rights are not lost or cancelled. If someone’s beneficiaries are not using the rights, a patent license to a third party in exchange for a royalty could be appropriate.

As part of the process of estate planning, intellectual property rights and intangible assets should be accounted for. You will need to decide how to transfer those rights and assets when you die and whether you should transfer these assets into a legal entity prior to your death. It is important that your beneficiaries understand your wishes and understand how to maintain your assets.

 


 

Thanks to our friends and contributors from De Boef Lucchesi, P.C. for their insight into estate planning.