Chris L. Anderson, P.C.
Attorney at Law
Your Subtitle text
ESTATE PLANNING INFORMATION

EXPLANATION OF WILL, TRUST AND PROBATE TERMS

Will:  A document that directs how the property owned by the person at the time of death will be distributed, if there is not a beneficiary arrangement already in place.

Holographic Will:  A handwritten Will which is permitted under Arizona law and which has no formal requirements other than that the material provisions must in the handwriting of and signed by the person making the Will.

Probate:  The legal process used to collect the assets of the deceased person (when a beneficiary designation is not already in place); administer final financial or legal matters; pay creditors, taxes and other bills; and distribute the assets of the deceased person's estate to the beneficiaries, according to the terms of the Will or the intestate laws.  A probate can be either formal or informal.  An informal probate is used in the vast majority of cases and involves no court hearings or supervision. A formal probate is typically used when there is a Will contest, a beneficiary dispute or some other estate issue that requires resolution through one or more hearings.

Intestate Laws:  The laws which apply when the person dies without a Will and which provide for how a person’s estate will be distributed to a person’s lawful heirs.

Trusts:  A document which can be used to minimize or reduce estate taxes, avoid probate and/or provide an asset management plan.  A trust can be funded or unfunded.  A funded trust is commonly referred to a "living trust," since it is administered during the person’s lifetime and thereafter.  A living trust can also be revocable or irrevocable.  A revocable trust is one that can either be changed or terminated at any time until the disability or death of the person.  An irrevocable trust may not be changed once created.  An unfunded trust is typically funded upon the person’s death, pursuant to the terms of the person’s Will or through beneficiary designations. A trust may be considered a separate legal entity with separate reporting responsibilities depending upon the type and status of the trust.

Medical or Health Care Power of Attorney:  A document that gives authority to another person (the agent) to make medical decisions, including giving or withholding of medical care, when the person cannot make those decisions for themselves because of mental or physical disability.

Living Will:  A document that describes how the person wants certain life threatening or end of life conditions to be handled.  These directives may include withholding heroic or significant procedures when a serious medical event has occurred.

Financial Power of Attorney:  A document that gives authority to another person (the agent) to make financial decisions for the person (the principal).  It can be either general or special.  A general financial power of attorney means that the agent has authority to do anything that the principal could do.  A special financial power of attorney limits the agent’s authority to only those powers described in the document (such as the power to sell a piece of land or an item of personal property).  It can also be either durable which is effective upon execution of the document or springing which is effective only when the principal becomes disabled.
Resources courtesy of:

Chris L. Anderson, P.C.
301 East Bethany Home Road
Suite C-195
Phoenix, Arizona 85012-1266
(602) 266-0515
(602) 266-2484 FAX
chris@chrisandersonlawaz.com
Website Builder