Myths about Probate and Revocable Living Trusts

September 8, 2009

By Robert S. Meyring

Attorney at Law*

 

Myth #1: "You should avoid probate."

The Truth: The Probate of a deceased person's estate is often necessary and in the best interests of that person's family and beneficiaries. Usually the speaker of the above mythical phrase is trying to sell you something.

Why should you avoid Probate? Many people hear the phrase "avoid probate," but most listeners do not grasp the meaning and the motive behind those who say it. Probate is the legal process by which the State, through the Probate Court, gives legal authority to a person as executor or administrator so they may distribute the decedent's remaining possessions and pay or settle the existing debts. The Probate Court approves the final will and its clauses within, describing estate distribution. The Probate Court also makes sure that, if there's no will, the decedent's surviving spouse and next of kin do actually receive the estate's assets.

The greater cost associated with "avoiding probate: is paid in two places: 1) during the planner's lifetime when a Revocable Living Trust (RLT) and other documents are created in order to avoid probate and 2) after the death of the planner when Probate is necessary anyway in order to complete the transfer of assets that were never transferred to the trust. Often with a probate-avoidance themed estate plan, the Probate Court must appoint an administrator anyway if there is no will or an executor if there is a will.

Myth #2: "A Revocable Living Trust will help avoid probate and reduce the amount of "death taxes" due to the IRS."

The Truth: The RLT is often not necessary and in most cases a customized Last Will and Testament would have been less expensive and more specific to the trust-signer's needs.

The website www.WillsQuill.com, under the homepage "articles" tab, has more myth-busting information.

* Robert S. Meyring, Attorney, offers free 10-minute phone consultations at 678-217-4369.

Atlanta Georgia Wills Estate Planning Law Firm Will Contest Executor Heirs Probate

You're the Executor of a Debt-Ridden Estate

Now What?

 
 

September 8, 2009

By Robert S. Meyring

Attorney at Law*

 
 

What does the title mean? What's an executor? Why would you be an executor? What is an estate?

 
 

Chris, a lawyer, was riding a motorcycle on a country road when he rounded a sharp curve, crossed the middle of the road, and slammed head-on into a truck. Chris died. Chris had a spouse, children, the land and house where he lived, cash, a lot more debts than assets, and a will that named his brother Dexter as executor. Aptly, Chris was a lawyer that was taught, like all other lawyers during law school, the importance of drafting a will and making sure you do not leave an intestate mess behind for your family and loved ones. 

 

I've said many times that estate planning is the specialized practice of law that answers the question: "What happens if I am hit by a bus?" (Please see WillsQuill.com homepage for the article.) In a larger sense, estate planning is about helping, guiding and advising people and their families during difficult times. But please be aware that estate planning is also a "gateway" practice area that many "non-estates lawyers" with a book of forms will tell you they can do. Here, you will get what you pay for. When it comes to the actual application of probating Chris's estate for his hypothetical family, a non-estates gateway lawyer is liable to make the situation worse at the worst time. If Chris's spouse hires a non-estates attorney to help with the probate, that attorney comes with the added risk of an inability to maximize the value of the estate. In this way, billions of dollars are unnecessarily paid from probated estates to Uncle Sam or to creditors every year.

 

Dexter, brother to Chris and uncle to his children, was named as executor in Chris's will because Chris trusts Dexter to gather Chris's assets, resolve debts, and distribute remaining property and money of the estate (a decedent's total assets and liabilities). Chris was not married at the time he drafted the will. If he was given the option, Chris would have changed his choice of executor to his wife after he was married. Given the facts - that Dexter, the named executor, now lives thousands of miles away from the place where Chris's estate will be probated, and that Chris's wife is a better local choice for executor - the wife can instead be the executor if Dexter says it is ok. If that's not ok with Dexter, then the wife can either fight the issue with him in Probate court or agree with Dexter and let him be the executor as stated in the will.

 

In Chris's scenario the three most serious issues are: how to follow the decedent's wishes, how to reduce the personal liability of the executor, and how to resolve the estates debts by keeping the most money in the estate while paying the least amount to creditors. An estates attorney, and none other, has the needed skill set and can best assist the executor to achieve those goals. Sometimes, depending on many factors, an estates attorney can resolve millions of dollars in estate debt with payment of pennies on the dollar - or less. In an estate like Chris's, his surviving spouse can easily lose the home, land, and other assets without the help of a trusts and estates attorney. Put another way, Chris's surviving spouse will likely lose the house if she does not get the assistance of an estate planning attorney.

 

An estate planning attorney will protect the surviving spouse from the debts and creditors of the deceased spouse. The estate planning attorney will file petitions with the Probate and Superior courts, appear at court on behalf of the executor, and make arguments before the judge to correct the respective mistakes and oversights of the original will or trust document. So if the attorney that proposes to help draft your will is not an estate planner or the lawyer that assists in the probate your loved one's estate does not "go to court," you may end up short changed.

 

 

*Robert S. Meyring offers free 10 minute phone consultations at 678-217-4369. The law firm's website www.willsquill.com has more articles, details, and planning forms. The office is located at the Vinings Jubilee at 2900 Paces Ferry Road, Atlanta, Georgia 30339; Email: meyring@willsquill.com. The Firm practices in estate planning, wills, trusts, probate of estates, litigation and related general practice matters.