Avoiding Common Mistakes in Estate Planning
Estate planning is designed to fulfill the wishes of a person after his or her death. Problems can easily arise, however, if the estate plan contains unanswered questions that can no longer be resolved after the person’s demise. This can, and frequently does, lead to costly litigation counter-productive to the goals of the estate. It is important that the will be written in language that is clear and that the document has been well proofread because something as simple as a misplaced comma can significantly alter its meaning.
Although the law allows for an individual to handwrite their own will, in my law practice I have seen some tragic situations where the testator did not consider all the consequences or where the words used actually contrasted with other parts of the will causing confusion.
Planning for every possible contingency is a significant part of estate planning. Tragic scenarios in which an estate planner’s loved ones predecease him or her, though uncomfortable, must be considered during the preparation of a will to avoid otherwise unforeseen conflicts. Business succession planning also must be considered in some instances.
Even trained professionals can make significant mistakes if they are not well versed in estate planning. An attorney who practices general law, while perfectly capable of preparing simple wills, may not understand the intricacies of trusts and tutorships or the use of usufructs. A great many attorneys, not aware of the tax consequences of bequests involving IRAs, may leave heirs with unnecessary financial obligations. If an attorney is not knowledgeable enough to ask the proper questions, he or she will be unable to prepare an estate plan that functions efficiently and ensures the proper distribution of the estate’s assets.
In spite of the wealth of an individual, the estate may be cash deficient if that wealth is tied up in immovable property at the time of the individual’s death. If the executor of the estate does not have access to funds to pay the estate’s bills or taxes, the heirs of the estate may run into trouble.
Consulting with attorneys who specialize in estate planning is the cornerstone of creating a plan to ensure that one’s desires are carried out and that all the bases are covered. Estate planning attorneys serve as invaluable repositories of all information necessary to strategizing a plan that not only meets one’s personal needs and desires, but is legally binding.