Estate Planning Terms

Generally, anything a person owns, including a home and other real estate, bank accounts, life insurance, investments, furniture, jewelry, art, clothing, and collectibles.

A person or entity (such as a charity) that receives a beneficial interest in something, such as an estate, trust, account, or insurance policy.

A payment in cash or asset(s) to the beneficiary, individual, or entity who is entitled to receive it.

All assets and debts left by an individual at time of death.

A person with a legal obligation (duty) to act primarily for another person’s benefit, e.g., a trustee or agent under a power of attorney. “Fiduciary” implies great confidence and trust, and a high degree of good faith.

The process of transferring (re-titling) assets to a trust. The terms of the trust, and distributions to avoid probate will only apply to those items which are in the trust.

Unable to manage one’s own affairs, either temporarily or permanently; it often involves a lack of mental capacity.

The court-supervised process of managing the assets of an incapacitated person. Conservatorship is a similar process where a person is mentally competent but seeks assistance due to physical disabilities.

A deduction on the federal estate tax return, it lets the first spouse to die leave an unlimited amount of assets to the surviving spouse free of estate taxes. However, if no other tax planning is used and the surviving spouse’s estate is more than the amount of the federal estate tax exemption in effect at the time of the surviving spouse’s death, estate taxes will be due at that time.

The process of winding down the final affairs (valuation of assets, payment of debts and taxes, distribution of assets to beneficiaries) after someone dies.

A contract where one party, known as the trustor, or settlor, gives another party, known as the trustee, the right to hold property or assets for the benefit of the beneficiaries. A trust must be in writing and has numerous legal requirements.

If you have any additional questions about estate planning, or would like to consult an estate planning professional, please contact our offices. We can make sure you have a comprehensive plan tailored to your family’s unique needs and goals.