If you die without a will, the laws of intestate succession control the disposition of your assets. These law vary from state to state, but typically the distribution is among your spouse and children, or more remote family members.
A will allows you to specify who will receive your property and the manner in which they will do so. A will provides for the distribution of certain property owned by you at the time of your death, and generally you may dispose of such property in any manner that you choose. A will appoints an executor to manage the distribution of your assets as well as a guardian to provide for the care of your minor children. A will does not govern the transfer of certain types of assets, called nonprobate property, which transfer by operation of law (I. E. Joint ownership with rights of survivorship), or by beneficiary designation.
No, only property that is owned by you individually will generally need to be included in the probate process. This excludes nonprobate property such as jointly owned property, property held in trust, and property with an effective beneficiary designation or transfer on death designation.
A revocable trust, or sometimes referred to as a living trust, is legally in existence during your lifetime and has a trustee and a settlor. Often times these trusts are not funded until after you die. A living trust is generally described as a trust that you create during your lifetime. This trust is revocable in that you retain the right to alter or amend and revoke the trust provisions at any time during your lifetime. Living trusts can also provide you with a vehicle for managing property during your lifetime and also as a tool to avoid probate. In Kentucky, any property titled in the name of a joint revocable living trust will not be included in the probate process.
This document appoints someone to make financial and property decisions on your behalf. It is general, in that the powers are not limited and your attorney-in-fact can carry out any action/transaction that you could do so yourself. This document is also "durable" because it is designed to remain effective even in the event that you are incapacitated.
Many clients like to implement a living will, which is your directive to your attending physicians with respect to end of life decisions and whether the use of life-prolonging and life-support treatments should be administered or removed. Along with a living will, you also should have a designation of health care surrogate to appoint an individual to make medical decisions on your behalf in the event that you cannot do so yourself, along with a HIPAA authorization that provides an individual of your choosing with access to medical records in the event that they need to make a medical decision on your behalf.
Probate is the formal legal process of transferring property from a deceased individual to either the individuals named beneficiaries under their last will and testament or to the intestate beneficiaries provided by state law (in the event that the deceased person does not have a last will and testament). Many people choose to avoid probate by implementing a revocable living trust and funding it with their assets during their lifetime.
In the event that you want to leave assets to a disabled or special needs loved one, it is advisable to do so by establishing a special needs trust for their benefit. Establishing an SNT will allow the individual to receive the property that you would like to provide to them while maintaining their benefits for Medicaid and SSI purposes.