Estate planning

Sections Contest Property disposition Common types Other types Governing doctrines Estate planning is the process of anticipating and arranging for the management and disposal of a person's estate during the person's life in preparation for future incapacity or death.

Typically referred to as dynasty planning, these types of trust provisions allow for the protection of wealth for several generations after a person's death.

For example, an estate plan may include a healthcare proxy, durable power of attorney, and living will.

After widespread litigation and media coverage surrounding the Terri Schiavo case, estate planning attorneys often advise clients to also create a living will, which is a form of an advance directive.

Specific final arrangements, such as whether to be buried or cremated, are also often part of estate plan documents.

In the United States, assets left to a spouse who is a U.S. citizen or any qualified charity are not subject to U.S. Federal estate tax.

Individuals may give away as much as $17,000 per year (in 2023) to another person without incurring gift tax or using up any of their lifetime exemption amount.

Other tax-advantaged alternatives to leaving property, outside of a will, include qualified or non-qualified retirement plans (e.g. 401(k) plans and IRAs) certain "trustee" bank accounts, transfer on death (or TOD) financial accounts, and life insurance proceeds.

Although legal restrictions may apply, it is broadly possible to convey property outside of probate, through such tools as a living trust, forms of joint property ownership that include a right of survivorship, payable on death account, or beneficiary designation on a financial account or insurance policy.

In the United States, without a beneficiary statement, the default provision in the contract or custodian-agreement (for an IRA) will apply, which may be the estate of the owner resulting in higher taxes and extra fees.

Because of the potential conflicts associated with blended families, step siblings, and multiple marriages, creating an estate plan through mediation allows people to confront the issues head-on and design a plan that will minimize the chance of future family conflict and meet their financial goals.

In addition, when the Will is signed by the testator, there must be at least two witnesses who are at least 18 years old, of sound mind and they are not visually impaired.