Everyone knows they should have a will, but it never feels like the right time to make one. When you are young, you may think you have plenty of time or not have enough property to bother. As you age, building your life and family, many other things take priority, but it is never too early to start planning your estate. The failure to make a plan can leave your loved ones unsure of what to do if something happens to you.
Our Arkansas estate planning lawyer has over a decade of experience at the Harris Law Firm. Her pre-law experience as a social worker informs her approach to helping clients plan their estates, and she brings her compassion and understanding to help counsel clients through challenging conversations about their mortality. Contact us today to learn how we can assist you in identifying your estate planning goals and putting a plan in place.
What Is an Estate Plan?
Some people mistakenly believe that only families with significant assets can benefit from an estate plan. This is simply not the case. Planning for your future is a critical step for any family, regardless of financial status. A basic estate plan might include:
- A last will and testament,
- Healthcare directives, and
- Durable powers of attorney.
Families with more assets might elect for a more complex estate plan that offers certain tax benefits. Contact an Arkansas estate planning lawyer at the Harris Law Firm today to discuss what kind of estate plan fits your needs.
Probate
When a person dies, someone has to take their estate through probate court. How complicated this process is depends on whether the individual left a will, the size of the estate, and how much of the estate is subject to probate.
Regardless of whether the deceased individual left a will, the law refers to them as a “decedent.” If the decedent leaves a valid will, they are a testator, and the estate passes according to their will. If the decedent does not leave a valid will, their estate passes through state intestacy law.
Intestate Succession
Intestate succession is the distribution of assets of someone who died without a valid will. After the decedent’s death, someone, typically a relative, notifies the probate court about the death. The court appoints an estate administrator, who must notify the decedent’s heirs and creditors. The administrator satisfies debts and then distributes the remaining estate.
Under Arkansas’s intestacy laws, estate assets are distributed to heirs as defined by preference order. If a decedent has no surviving relatives at a particular preference level, you move to the next. Those preference levels are:
- First, to the decedent’s surviving descendants;
- Second, to the decedent’s surviving spouse of three or more years;
- Third, if the decedent was unmarried, to the decedent’s surviving parents ;
- Fourth, 50% to the decedent’s surviving spouse of three or less years and 50% to the decedent’s surviving parents;
- Fifth, to the decedent’s surviving siblings and their descendants;
- Sixth, to the decedent’s surviving grandparents, aunts, uncles, and their descendants; and
- Seventh, to the decedent’s surviving great-grandparents, great-aunts, great-uncles, and their descendants.
If the decedent has no known heirs, the estate passes to the county where they resided.
What Is a Will?
A will is usually the first document that people think about when you mention an estate plan. The will details the distribution of your assets following your death and names the beneficiaries of your estate. Beneficiaries are the people you named to inherit your assets. Your will should also include details about how you want your property to be distributed. Additionally, if you have minor children, you can name a guardian in your will.
Although intestate succession works well enough for some, many people want to have more control over what happens after they die. Through a will, you can direct which of your property should go to whom.
Will validity requirements
You must ensure your will meets your state’s legal validity requirements. The testator must be 18 or older and of sound mind. In other words, they must be capable of understanding what a will is and what it means.
The will must be:
- In writing,
- Signed by the testator,
- Witnessed by two individuals, and
- Signed by both witnesses.
A will not meeting these requirements is typically invalid unless it is a “holographic” will. Despite the odd name, a holographic will describes a handwritten will. The holographic will may be valid if the will is entirely in the decedent’s handwriting, as attested to by three disinterested witnesses.
Will contests
If a potential heir or beneficiary under a current or former will believes there is reason to doubt a will’s validity, they can initiate a will contest during probate. Will contests typically fall into three categories:
- The decedent lacked testamentary capacity;
- The will was improperly executed; or
- Someone exercised undue influence over the decedent.
A decedent who lacked testamentary capacity was not of sound mind. An improperly executed will fails to meet the minimum writing, signature, and witness requirements. Finally, a person exercises undue influence when they use means like fraud, duress, or coercion to induce the testator to make or change their will.
Trusts
While property that passes by will or intestate succession must first go through probate, trusts typically bypass probate. By bypassing probate, trusts allow funds to get to their intended recipients quicker and with less potential costs.
Trusts can have many purposes. The person who creates the trust, the grantor, can set terms on when and how those who receive trust benefits, the beneficiaries, get funds. The grantor also designates an individual or entity to serve as trustee. The trustee manages the trust according to the terms the grantor sets.
The grantor can create the trust while they are alive, an inter vivos or living trust, or after they die, a testamentary trust. Either type of trust can also be revocable or irrevocable.
Some common trusts include:
- Special needs trusts,
- Minor trusts,
- Spendthrift trusts,
- Asset protection trusts, and
- Medicaid trusts.
However, you can adapt trusts to suit various purposes depending on your needs.
Healthcare Directives
An advance healthcare directive is also known as a living will. In your advance directive, you provide details about your wishes in various medical situations. For example, you can declare that you do or do not want the assistance of a ventilator, or you can list medications you do not want to receive.
Your living will is legally binding. It only becomes active if you cannot make your own health decisions because of mental or physical incapacitation.
An advance healthcare directive provides instructions to your loved ones concerning your healthcare choices in the event you become incapacitated or unable to communicate your wishes. These choices might include:
- Whether doctors should use extraordinary measures to prolong your life,
- Whether you wish to donate your organs, and
- Instructions regarding your remains.
End-of-life care is a difficult topic to discuss with your family. However, an advance healthcare directive is a critical part of your estate plan. Contact a lawyer at our Arkansas estate planning law firm to help you create these essential documents.
Powers of Attorney
Although your living will can cover many circumstances, unanticipated events often occur. In those situations, you can designate health and financial powers of attorney. Like advanced directives, the power of attorney document only kicks in if you become incapacitated.
Powers of attorney are empowered with the legal authority to act on your behalf and frequently make decisions of significant consequence. When you declare a power of attorney, you select an individual you trust to know and honor your wishes in a given situation.
When Should I Update My Estate Plan?
Estate planning is not a one-time process. Instead, you need to update your estate plan as your life and circumstances change. The events that will likely create the need to update your estate plan could include:
- Birth of another child,
- Divorce,
- Re-marriage,
- Purchasing a new house,
- Inheriting a large sum of money,
- Birth of a grandchild,
- Purchase of a large asset,
- Move to a different state,
- Purchase or sale of a business,
- Retirement,
- Death of a loved one, or
- Incapacitation of a beneficiary.
Any of these events might result in changes to your estate plan. Our team at the Harris Law Firm is here to assist you every step of the way. We can guide you through your options and help you understand the impact of your estate planning decisions. Contact us today to get started.
What Happens If I Do Not Create an Estate Plan?
If you die without a will, that is called dying intestate. If you die intestate, your state’s intestate succession rules dictate what happens to your assets. Your personal wishes for your estate will not come into the picture, and your assets will be distributed according to state law. This could result in your property being distributed to people you did not want to receive any assets.
Contact an Arkansas Estate Planning Attorney at the Harris Law Firm Today
Since 1981, the Harris Law Firm, PLLC, has been providing sophisticated legal expertise throughout Mississippi and Arkansas. When you work with the Harris Law Firm’s estate planning and probate lawyer in Arkansas, we allow you to transform your goals into an actionable plan. We can guide you through the Arkansas estate planning process to protect what matters long after you are gone.
We pride ourselves on offering top-quality legal services to all of our clients. We take the time to get to know each of our clients personally so we can determine how to best serve their interests. With our team of estate planning lawyers, you can rest easy knowing that your estate plan is in the hands of competent, experienced legal professionals. Contact us today to get started on your estate plan.