By: Matt Luedke
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Simple Guide to Washington State Estate Planning
You may have heard the phrase, “Nothing is certain except death and taxes”. We should probably plan for both right? Estate planning doesn’t have to be a boring topic, and much of it can be pretty interesting once you start to understand the benefits. You have nothing to lose but many benefits to be gained through solid estate planning – by securing all the assets you’ve worked hard to gain in your life.
Modern research has established that fewer than half of all American citizens have a will & testament. Astonishingly, just about 1/3 of all adults with minor children under 18 have created a will or living trust for themselves. Don’t become a statistic! Secure your assets and ensure that your surviving family members are protected by preparing your estate plan today.
Let’s Start with What Your Estate is Comprised of…
We’ll take a few steps back here just to be certain that we’re comprehending the actual definition of an estate. Fundamentally, your “estate” is how the legal system views the overall value of your net worth.
Your estate may include any of the following:
- Bank Accounts
- Cars and other vehicles
- Houses and other real estate
- Personal belongings
- Life insurance
In a nutshell, your estate is comprised of everything you currently own as well as all your current debts. We’ll focus more on that part later. Now that you understand what an Estate is, we’ll move on to how you can create a plan for yours.
Your estate plan is assembled from several different legal documents. Each one of these documents serves an important purpose. An estate plan can include everything from setting up a trust fund to designating a power of attorney.
The entire goal of estate planning is to save and secure all the important assets you’ve worked hard to amass over time. Naturally, the objective is also to bring down the costs you’ll pay in taxes, legal expenditures, court fees, and many other types of expenses too.
Here are some of the more common estate planning documents:
LAST WILL AND TESTAMENT
The most critical portion of your estate plan is your last will and testament. In this document, you specify in detail how your assets are divided, who will be the guardian of your children, and who is designated to carry out your wishes.
Please also understand that your last will and testament will only be relevant after you die. It doesn’t offer any protection at all if you become physically or mentally incapacitated.
LIVING WILL DOCUMENT
If you’re in a condition where you’re unable to make decisions on your own, a living will can help establish your wishes. For instance, you may become hospitalized in a comatose state in which your abilities are gravely limited. If you have strong beliefs about when, or when not to receive resuscitation or life-sustaining care, you could indicate these wishes within your living will.
POWER OF ATTORNEY
Most people prefer to appoint a trusted relative or close family member to make decisions on their behalf. This is known as power of attorney. Generally, you would name a spouse, family member, or close friend to address your affairs when you’re unable to do so.
There are many distinct types of powers of attorney that vary in scope, length, and circumstances. It’s significant to note that you can grant health care power of attorney and financial power of attorney to several different individuals if you’d like. It also goes without saying that you had better trust your power of attorney with your life!
A living trust is a legal document that places your assets into a trust during your lifetime. Upon your death, it is transferred to your designated beneficiaries. It is possible to create a living trust in addition to a last will.
The biggest benefit of creating a trust is it will help you avoid the probate process. In short, a living trust can help protect your assets from being drained by court and legal costs. It also helps things run a lot more smoothly in general, as your beneficiaries can receive their inheritance faster and with less hassle.
Important Things to Remember About Estate Planning in Washington State
If you die in Washington State without having completed your will, the state will appoint an administrator to allocate your estate (your assets) according to Washington State succession laws. These are laws which give control of your assets to your “closest” living family or relatives. We highly recommend that if you care about what happens to your assets when you pass away — and you should! — make sure you do the prudent thing and create a will!
Probate is defined as a legal procedure for settling an estate of a person who has died. Luckily for you, the state of Washington has one of the easiest to understand probate structures in the country.
- Your personal representative (as designated in your will) can act with complete authority and without court intervention in nearly all matters
- Attorney fees are not based on a percentage of the value of the estate
Click here to learn more about our Probate services.
Washington State does not maintain an inheritance tax but does collect an Estate Tax. This means that there are no taxes for the recipients of an estate, but it’s possible that there could be some tax on the decedent’s estate itself.
There are many exemptions and thresholds (among other things) that you should be aware of, you should discuss these with our estate planning attorneys as soon as you’re able. In most cases, there is no estate tax owed as a result of extensive tax planning within the decedent’s will. Just one of the many great reasons to plan your estate!
Learn more about estate taxes in the state of Washington.
Washington State and even Federal Tax laws are constantly fluctuating. You should plan to review your estate plan periodically to make sure it’s up to date. We offer our Client Care Program which makes this process even easier for our clients.
How Moulton Law Offices Can Help Your Family
It’s normal to feel a bit overwhelmed when starting out with your estate plan. We find that all what most families really need is a Law Firm you can trust to provide your family with financial security. We’ll help you navigate the planning process and ultimately help you make the best decisions for your family well into the future. At Moulton Law, our estate planning process may include:
- Creating a Living Trust so that your wishes will be honored.
- Updating your beneficiary designations as needed.
- Reduce federal and state estate taxes through trusts and gifting.
- We’ll help you consider both Federal and State estate taxes.
Our dedicated team of Estate Planning, Tax, & Probate Attorneys will ensure that you gain clarity about your estate plan. Call or Email us today to schedule an appointment to get all your questions answered about washington state estate planning.