Estate Planning Attorneys in Scottsdale | Colby&Thornes
Estate planning is much more than a technique to distribute your property when you die. A comprehensive estate plan is a strategy designed to deal with taxes, guardianship, disability, probate, protection of inheritances to children against creditors and divorce, and a host of other issues, any one of which could pose a threat to your estate.
Whether or not you are a high net worth individual, the attorneys at Colby&Thornes can help in planning your estate plan and attending to many related legal needs. With combined experience of over 50 years, our estate planning and estate administration attorneys will work with your accountants and financial advisors to create an estate plan that addresses all your needs. Call us to schedule an appointment to discuss how we can help you.
What Does an Estate Planning Attorney Do?
An estate planning attorney creates an overall framework that achieves your goals while minimizing taxes and administration fees. Our firm provides specific services in many different areas of estate planning, including:
- Revocable Trusts. A revocable trust is a legal entity created by a person (called the “settlor” or “grantor”) to hold assets during his or her lifetime, and to dispose of those assets upon death. The central feature of a revocable trust (sometimes referred to as an inter vivos trust or a living trust) is that it can be modified or revoked by the settlor/grantor at any time. The trust will determine the method and manner of how your assets are distributed after your death. Establishing a revocable trust during your lifetime may provide certain advantages, including flexibility, eliminating the expenses of probate, saving on estate taxes, protecting inheritances of children from creditors and divorce, and anticipating, defining and addressing the possibility of your future incapacity and how to protect and manage your assets in such a situation.
- Last Will and Testament. A will is a written document that, in its simplest form, determines how your assets will be distributed when you die. You can change a will at any time by adding a codicil, by revoking the will, or by having a new will prepared to replace and supersede the old will. All wills must be probated. Creating a revocable trust and titling all your assets into it will ensure that probate is avoided.
- Irrevocable Trusts. Depending upon your situation and the assets in question, irrevocable trusts may result in avoidance of some estate taxes or create protections in the event of disability or incapacity. An irrevocable life trust, generally, cannot be rescinded or modified by the settlor/grantor after it is created. They can also be used as effective instruments to hold substantial gifts to children and other loved ones due to special and unique circumstances. And because the trust owns the assets, and not the beneficiaries, irrevocable trusts can provide a measure of asset protection from creditors of those beneficiaries.
- Life Insurance Trusts. An irrevocable life insurance trust (ILIT) can be formed to own and control an insurance policy on your life, to assist in managing and distributing the death benefit proceeds as well as avoiding estate taxes on the death benefit proceeds. The primary benefit of an ILIT is to provide funds for family and loved ones, without having the proceeds included in your estate for estate tax purposes. You can dictate how and under what circumstances the funds will be distributed. The funds can replace earnings for family members, provide for the education of children and/or grandchildren, cover the costs of final expenses, and/or provide liquidity to pay taxes. And because the trust owns the policy, and not the beneficiaries, an ILIT can provide a measure of asset protection from creditors of those beneficiaries.
- Powers of Attorney. A power of attorney is a document that grants the authority of one person to act in the place and stead of another person. The person who grants the power, and authorizes another person to act in his or her stead, is known as the principal. In this context, all those terms have the same meaning. The person who is authorized to act under the terms of the document is called the agent, or the attorney-in-fact. Subjects covered under a power of attorney could be wide-ranging. Most often, however, a power of attorney is used to address issues relating to your finances, medical records, and health issues in the event of your incapacity and to provide authority for loved ones to make these decisions on your behalf if you become incapacitated.
- Incapacity and Estate Planning. Incapacity is a subject, like death, that people would like to avoid discussing. But any worthwhile estate plan must deal with the issue realistically, and provide sound solutions to deal with the problem. What would happen if you became incapacitated and could not manage your own affairs? At Colby&Thornes, we anticipate the possibility, and provide for mechanisms to deal not only with your IRAs and employer sponsored plans but also all other financial assets including your home and other real property you may own. We also provide a plan for who will make decisions on your health care needs if you cannot.
- Business Succession Planning. A successful strategy for the future of your business involves a multi-faceted approach dealing with such issues as ownership, management, and leadership. But it must also address taxes, proper entity formation, and a host of related matters, all of which, if performed properly, can help to assure the orderly and effective transition of your business upon retirement, disability or death. Potential problems can be caused by technical mistakes, planning without taking all relevant factors into consideration, leaving a business to a surviving spouse who has had no prior involvement in the company, difficulties relating to the differences of your children and equitably taking these factors into account, as well as many other factors specific to your unique circumstances. Failure to create the right plan (or failure to have a plan at all) can lead to the forced sale of the business, diminution of value of the business, disputes over control, a lower valuation of the business, and unnecessary and excessive taxes.
- Estate and Gift Tax Filings. When a person passes away, the estate may be required to file a federal estate tax return, known as Form 706. During life, when you make a gift to any person in excess of the annual exempt amount, a gift tax return, known as Form 709, must be filed. To comply with the law, and particularly in view of the many changes in this area over the past several years, it is essential to have knowledgeable advisors (a) to determine if a Form 706 filing or a Form 709 filing may be necessary, and (b) to be sure that you take advantage of all the potential benefits that are available in such filings.
- Beneficiary Designation Assets. A beneficiary designation asset is an asset, such as an IRA, a life insurance policy, an employer sponsored retirement plan, a non-qualified annuity or even a bank account or brokerage account, where, upon your death, the asset will be payable directly to the beneficiary by operation of law, avoiding probate, and without the need for a will or a trust. A beneficiary designation itself will not remove an asset from your taxable estate, but it will provide that the asset goes directly to the beneficiary as set forth in the beneficiary designation.
Who Needs an Estate Planning Lawyer?
Whatever your financial position may be, proper estate planning is vital to deal not only with the distribution of your assets, but also to minimize any tax burden, and to make sure that your wishes are carried out after your death. Even with the generous federal estate tax exemption ($5.49M in 2017 adjusted upwards yearly by CPI), there are many reasons why, as a resident of Arizona, you may need the services of an estate planning lawyer. Here are just a few of them:
- You want to avoid probate.
- You have been married more than once.
- You have blended families and ex-spouses.
- You own a business.
- You have children and you want to protect their inheritance from creditors or divorce.
- Your holdings include substantial IRA’s and/or 401(k)’s and your beneficiary designations are complicated.
- You have an estate in excess of the estate tax exempt amount.
- You own real estate outside Arizona.
- You would like to bequeath assets to charity.
- You want to make substantial lifetime gifts to children or others.
These are just some of the many reasons why it makes sense to consult with an experienced attorney about your estate planning needs.
Scottsdale Estate Planning and Estate Administration Attorneys
If you are concerned about your will, your retirement planning or your estate needs, you want an attorney who knows the law, and who has the relevant financial and legal experience to provide guidance in these matters. You also want an attorney who will give you the peace of mind that comes with knowing your affairs are in order, and, of course who will make sure that any taxes are minimized.
At Colby&Thornes, we are committed to providing the very best in legal counsel for all your estate planning requirements. With decades of experience, our legal team is fully aware of the latest changes in the tax and other laws in the area, and we offer solutions that coordinate your estate needs, your retirement, and your short-term and long-term financial goals. Call us and find out how our firm can make a difference in your life.