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Personalized And Knowledgeable Legal Guidance To Draft Your Will Or Trust In The Twin Cities

Planning for the future may be a delicate and difficult ordeal. However, it could help you prepare before an adverse event. When it comes to your assets, property and welfare of your loved ones and business, an estate plan can help you prepare for the unexpected.

At rb LEGAL, LLC, in the Twin Cities, our attorneys have the experience required to guide your decision-making to choose the right legal tools. Two of the most well-known legal instruments used in estate plans are wills and trusts. But, when do you need a will? What are the benefits of having a trust?

How Can A Will Help You Protect Your Assets And Loved Ones?

A will is a document enforceable only after the passing of the testator, the person who drafted the will. Through a will, you can leave property, assets and wealth to beneficiaries and name guardians for your children. You may also name conservators for family members who need legal representation in financial affairs.

All wills should go through probate, a process in which a Minnesota court validates the document and supervises asset distribution to the relevant beneficiaries. Probated wills are made public after your passing.

Characteristics Of A Trust

A trust is a document that allows passing your property at a given time. Property may be transferred to a trust and further administered by a trustee  ̶  an individual or company/firm  ̶  for the benefit of relevant beneficiaries. A trust remains private even after the settlor’s (the person who drafted the trust) death. Moreover, property designated as part of a trust does not have to go through probate.

A Dedicated And Personal Approach

An estate plan may include both a will and a trust, according to your specific needs. Our attorneys dedicate time and effort to understand your needs and expectations and draft an enforceable estate plan according to your wishes. Our priority is to give you Peace of Mind by helping you protect those you care about most.

Questions And Answers About Wills And Trusts

Here are some of the most common questions we get from clients about wills, trusts, and estate planning:

Why is it important to have an estate plan?

An estate plan is like a set of instructions for your family and friends. Here’s what it covers:

  • In an emergency or if you cannot communicate: If you get really sick or are injured and cannot communicate with others, your estate plan tells your loved ones how to take care of you and your stuff (like your house or money). Without these instructions, your loved ones may have to go to court to get permission to help you.
  • After you’re gone: After your death, your estate plan helps your loved ones figure out what to do with everything you left behind. It’s like a map to guide them. Without these instructions, your loved ones will have to follow the default instructions written into state law and they may need to use a court to get permission to move forward.
  • Avoiding problems: With a good plan, your family won’t have to go to court and spend lots of money trying to figure things out. It’s like having a secret code that makes things easier for them.

So, by planning ahead, your “PR” (which stands for “personal representative”) can handle everything without going through a fancy and expensive court process.

What is the difference between a will and a trust?

A Will is like a set of instructions for what happens to your stuff after you pass away. It is like a letter to a judge explaining your desired outcome. It covers things like:

  • Who gets your property (like your house or money) if you don’t have a joint owner or a specific beneficiary named for that property.
  • Who you want to take care of your kids if they’re still minors or have a disability.
  • Any charitable gifts you want to make.

When you die, your beneficiaries (the people you’ve chosen) get everything you left behind. In most cases, a Will has to go through a court supervised process called “probate” in order to be enforced. When your Will goes to court, it becomes public information.

Unlike a Will, a Trust is a private plan that goes into effect right away for your benefit during your lifetime and continues even after you’re gone. Think of a Trust as a special container where you put your assets. It gives you more control over how your assets (like money or property) are managed and distributed.

The most common type of a trust is a Revocable Living Trust (RLT):

  • During your lifetime, you can continue to make changes to the RLT and control the trust’s property.
  • It helps manage things if you become unable to handle your affairs before you die.
  • Properly funded, it can avoid the court probate process.
  • Like a Will, it provides instructions on how you want property managed and distributed after your death.

There are specialized trusts for different situations, like pets, cabins, life insurance, and beneficiaries with unique needs. Depending on the Trust’s rules, beneficiaries might get their share all at once or in smaller portions over time.

Trusts can be private, and they can also protect a beneficiary’s inheritance from his or her creditors.

In summary, both Wills and Trusts are instructions about what to do with your property after death, but Wills are like public instructions, while trusts are like private plans.

Can an estate plan help minimize inheritance taxes for my heirs?

Estate taxes are like a fee you pay to the federal and state government when you transfer property to someone else after you die. Imagine it as a tax on passing the baton to the next runner in a relay race. When someone passes away, their property (like houses, money, or land) gets handed over to new owners. The government charges a tax on this property transfer—it’s called an estate tax. Both the federal and state governments assess this tax.

While you’re alive, you can plan ahead to lessen the amount of property that gets taxed after your death. One way is through planned gifting during your lifetime. Federal law allows you to give a certain amount to each person as a gift without paying any federal gift taxes. These gifts must be complete and meet specific rules.

Over your lifetime and even after you’re gone, you can give away a certain amount without facing any estate or gift tax. As of 2024, a US Citizen can give a total of $13.61 million over his or her lifetime and at death without incurring a federal estate tax or federal gift tax and a Minnesota resident can give up to $3 million at death without facing a Minnesota estate tax.

To minimize or eliminate estate tax, you can use special tools in your estate plan. An estate planning attorney can guide you on which tools work best for your situation. Remember to consult with a tax professional to understand your own tax liability.

So, think of estate taxes as the relay baton, and smart estate planning as your way to pass it smoothly to the next generation.

What are the responsibilities of an executor / personal representative of a will?

Your executor, more often called the “personal representative” (PR), will be tasked with the estate administration process after your death. This includes management of the estate’s property, paying debts, and distributing the rest according to your instructions. Your PR should be someone you trust, someone who can follow a schedule, and someone who is good with details. A fiduciary company could also serve as your PR if there is no individual you would trust.

What is probate and how does the probate process work?

Probate is a process that happens in court when someone passes away. Here’s what it involves:

  • Recognizing the Will: The court officially acknowledges the person’s Will which is a legal document that says how their property should be handled after they’re gone.
  • Choosing a Representative: The court appoints someone to be in charge of handling the person’s affairs. This person is called a personal representative.
  • Dealing with Property: The personal representative (PR) gathers all the stuff the person owned (like their house, money, and belongings).
  • Paying Bills: The PR use some of that stuff to pay off any debts or bills the person had.
  • Filing Taxes: The PR also takes care of filing any necessary tax returns.
  • Distributing Property: Finally, the PR divides up the remaining property among the people who are supposed to get it (according to the Will or state laws).

Remember, probate can take time and might involve some costs because it happens in court. But it’s an important process and sometimes the required way to make sure everything is handled properly after someone passes away.

If I don’t have a Will, how are my assets distributed after my death?

Without other valid estate planning documents, the property of Minnesota residents and property located in Minnesota follow Minnesota’s default estate plan:

  1. Your jointly owned property goes to the surviving joint owners;
  2. Your property with a valid beneficiary designation goes to the surviving designated beneficiary(ies);
  3. Through the court-supervised probate process, your share of co-owned property and all of your other property is split between members the first group in the following list order to have a living person in it:
    • Spouse (or if you also have children from a different relationship, your spouse and those children both receive property)
    • Children
    • Descendants of Children
    • Parents
    • Siblings
    • Nieces/Nephews
    • Descendants of Nieces/Nephews
    • Grandparents
    • Aunts/Uncles
    • Descendants of Aunts/Uncles
  4. If none of those groups have living people in it, then your property goes to “the next of kin in equal degree.”
  5. If no relatives survive you, the State will receive your property.

What legal risks does a Personal Representative face during the estate administration process?

A Personal Representative (PR) can be held personally responsible for any financial mistakes you make. For example, if you pay debts out of priority order as determined by state statutes, and there is not enough money left to pay a higher-priority debt after paying lower-priority ones, you may end up owing the money. Consult with an attorney to take steps in the right administrative order and help avoid costly errors.

What is a guardianship or conservatorship, and when might one be necessary?

When someone is not able to take care for his or her own needs, that person needs someone to help. That helper usually needs special legal permission to do their job effectively. Guardianships and conservatorships are ways that the government gives this permission and makes sure the helper does things correctly.

Here’s what it means:

  • Guardians: They’re like personal decision-makers for the person who needs help. They decide things like where the person lives, what medical care they get, and where they go to school.
  • Conservators: They handle the money stuff. They make decisions about paying bills, signing contracts, investing money, and buying or selling property for the person they’re helping.

To become a guardian or conservator, the court has to see proof that the person who needs help can’t make these decisions on their own. The court keeps an eye on the helper to make sure everything is done right.

There are ways to plan ahead so that a helper can get the legal permission he or she needs without going to court. Emergency planning tools like Durable Power of Attorney documents and Health Care Directives can help avoid the need for a guardian or conservator. Planning ahead for a possible emergency can save time, money, and paperwork.

What is a Health Care Directive and why might I need one?

A Health Care Directive is like a guidebook for your medical care. Here’s what it does:

  • Choose a Helper: You can pick someone to make medical decisions for you when you cannot speak for yourself.
  • Describes Your Wishes: It lets you write down what you want for your health care if you can’t talk or tell anyone.
  • Manages Appointments and Records: Your helper can schedule and go with you to doctor visits. They can also look at your medical records to help them decide what’s best for you.
  • Covers Mental Health Treatments: It can give your helper special permission to decide about treatments like electric shock therapy or certain medication for mental health.

A Health Care Directive helps you plan ahead so that your wishes are followed even if you can’t speak up at the time.

How can I make sure my adult and minor kids are protected?

You can use estate planning tools to help protect your kids while they are minors and into adulthood.

Here are some of the tools:

  • Will: If something happens to the parents, the Will says who will take care of the kids.
  • Designation of a Standby Guardian: This document gives someone the power to look after the kids if the parents can’t do it temporarily.
  • Durable Power of Attorney: This one is like giving a trusted friend a secret code to use your stuff (like your house or money) to take care of the kids.
  • Trusts: Parents can decide when the kids get any inheritance and for what the child can use it.
  • Supported Decision-Making Documents: After your child becomes a legal adult, the legal permission you have to help the child manage his or her property or help the child with her or his health care ends. These documents let them choose trusted individuals to help with important decisions about money and health. They can also help your child be prepared for an emergency.

Estate planning is like making sure your kids have a safety net, no matter how old they are.

Call Our Dependable Attorneys To Plan For Your Future

Trust our experienced attorneys to help you draft your plan. From our Golden Valley office, we are proud to represent clients throughout Minnesota.

Call 763-400-8833 or fill out our online contact form to schedule an appointment.