What is an Estate Plan?
Estate planning is more than just making a plan to distribute certain assets to certain people. A complete estate plan will allow you to retain control of your assets and to determine who will make decisions on your behalf should you become unable or pass away, not to mention minimising the taxation liability for your beneficiaries or trustees. The term “estate” refers to all of the assets of a deceased person wherever they might be located.
When organising your estate it is important to nominate an executor in your Will. A “legal representative” of a deceased estate is the general term for either an executor or an administrator, and is the person responsible for looking after your estate on your passing. If your Will does not name an executor, the named executor is unable to act, or you die without a Will, the person whom the court appoints to administer the estate is called an administrator.
Duties of the legal representative include, but are not limited to, the following:
• Organising your funeral or related service;
• Collecting, maintaining and protecting assets pending final distribution of your estate;
• Applying for probate or letters of administration;
• Paying all debts, funeral and testamentary expenses;
• Investing assets pending distribution of your estate;
• Obtaining a tax file number and lodging any tax returns for your estate;
• Distributing the assets as directed under your Will or the laws of intestacy.
Advance planning, good advice, and the proper assembly of important documents will all ensure that your estate is handled as easily as possible. The following issues should be considered when developing a thorough estate plan:
• Appropriate care for any minor children.
• Asset protection
• Probate avoidance
• Avoidance, minimisation and deferral of tax liabilities
• Planning for illness or incapacity
• Selection of guardians, personal representatives and other fiduciaries
• Formation of family limited partnerships and other business entities
• Succession strategies for family businesses.
A good estate plan should take into account both your personal and financial goals. For example, some families may need a trust to manage and distribute assets to minor children. Make sure that all of your assets of any value are considered when developing an estate plan, including real estate, business and farm interests, investments, retirement plans, life insurance proceeds, personal property, art or other collections, cash and personal effects.
Your estate plan will be formulated by taking into consideration the fair market value of your assets, how you own them legally, their growth potential, their liquidity, and what assets should be passed to specific individuals. A well planned estate will provide you with the comfort of knowing that your wishes will be carried out should anything happen to you in the future. This benefits not only you, but also your family members and other beneficiaries, who otherwise may face the burden of making choices for you without your input.
A major part of estate planning is preparing your Will, which is important at any stage in your life and is critical to ensure that when you die, your estate is handled the way you planned it. It is very important that your Will is valid and up to date. A Power of Attorney should also be considered. This is a binding legal document where you are able to appoint someone you trust to make decisions and managing your estates on your behalf. This is not only used when you are overseas or uncontactable, but is also important planning for if you become seriously sick or incapacitated. Other things to be taken into consideration are the preparation of enduring guardian, prenuptial agreements and testamentary trusts.
Here at The Quinn Group we are able to assist you in any Wills, estates or probate matters. Our experienced team of lawyers and accountants can help you plan your estate in order to give you peace of mind and reduce future stress for loved ones. For more information submit an online enquiry or call us on 1300 QUINNS (1300 784 667) or on +61 2 9223 9166 to book an appointment.