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Author: YewGuise Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 5741  
Subject: Re: named executor of my father's estate Date: 3/21/2011 2:28 PM
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...If his will left everything to his wife who is now deceased without any provisions for another heir in this case, then...

...then everything might go to his deceased wife's estate, i.e., HER heirs.

Btw, although we use the terms "executor" and "executrix" in conversation, when reviewing documents keep in mind that those terms have generally been replaced by "personal representative."

Regarding the trust:

1. Often people create trusts as estate-planning tools, and then neglect to move their assets into the trust. In this case, the terms of the will control.

2. When an estate-planning attorney prepares a trust and a will as a package (FYI, a package will also normally include a Power of Attorney and an Advance Medical Directive), the will is often a "pour-over" will, i.e., a very short document which states that the trust is the beneficiary. In this case, assets will go through probate and then into the trust, after which they'll be distributed according to the terms of the trust.

3. Many people's assets are a combination of those in the trust (house, bank accounts) and those not in the trust (car). Assets not in the trust go through probate, which causes a delay (delays vary depending on state).
(Note: IRA's can't be put into trusts, and have their own inheritance rules.)

4. It's better to put major assets in the trust before death due to the fact that probate can be time-consuming. Also, probate is public, so if you'd prefer friends, relatives, busybodies, litigious people, etc, not have easy access to the details of the estate, a trust can provide some privacy.

5. In general, taxes are the same whether using a trust or not (some exceptions with married couples, which don't apply here since your father's now single); however, some states charge a probate processing fee which is a percentage of the value of assets going through probate, so in this case moving assets to the trust before death (thereby bypassing probate) can save some money. This fee might be called a tax, so some advertisements say "Use a trust to avoid taxes," but I think that's misleading, because there are several different types of taxes, and for most of them it doesn't matter whether there's a trust or not.

6. DH's and my trust specifies that anyone who challenges its terms is automatically disinherited. I was surprised that such a clause is legal, but apparently it's pretty common. Your father might want to leave $10k (or better yet, a small percentage) to your brother, and also the "challengers get nothing" clause. Then your brother would have a choice of accepting $10k or suing and getting nothing.


Does your father's estate planning attorney have email*? If you've been given Power of Attorney, he will be free to discuss your father's situation and documents with you. In any event, the attorney will welcome input from you regarding your father's intentions, any potential conflicts, and your concerns. Then he can ask your father the right questions, even if confidentiality precludes his giving you feedback initially.

I have many siblings, and my father had very naive ideas about our future involvement with each other and responsibility for each other's finances. I was really taken aback by the first-draft overview of his trust. Discussion with my father went nowhere, so I emailed the attorney. At the next visit, the attorney asked my father additional questions and suggested alternative arrangements that were acceptable for everyone.

Another thought. It's good you weren't expecting any inheritance, and it would also be good for you to maintain your "zero" expectations, because, even assuming your father has the net assets he claims to have, his end-of-life care could wipe everything out (which is why "percentage" is safer for #6 above).

Good luck.

* Email is not secure, so the attorney might email pdf's with SSN's blacked out, or he might FedEx documents or CD's. Also, if you can't be at meetings physically, if your attorney has a speaker phone you might be able to be there by phone.
If you want your own copies of documents, and/or if you want to consult with the attorney by phone separately, it would be simplest to be prepared to pay for that yourself, out of pocket. I did that, not because my father would have objected to paying for my involvement, but because he already had sticker shock at the base price (about $3500), and I felt his getting this done at all was enough of a coup that I wanted to avoid adding to his distress with nickel-and-dime fees.
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