A will may not be the first thing a young person thinks of when he or she reaches the age of majority. However, every Washington, DC, resident could benefit from even basic estate planning. Anyone with a car, a bank account or a home may consider developing an estate plan. Further, if an individual has a child or children, a will could become even more important.
An estate plan leaves the control of what happens to a person's assets after death with the individual. In the absence of a will, the government will have that control. This second scenario offers no guarantee that the choices made will be in line with the wishes of the deceased. Again, if a person has a child, a will gives a parent the opportunity to choose who will continue to raise that child in the event the parent passes away before the child becomes an adult.
In addition to a will, a trust can also be useful for a variety of reasons. If a parent wishes to leave his or her assets to a child who is a minor, a trust can hold those assets until a time specified in the trust on behalf of the child. Distributions can be made for the child's benefit and, at some point, the child may be able to remove the assets from the trust.
Another reason for a trust is to eliminate the need to pay estate taxes. Federal and state laws allow a certain amount of an estate to pass to heirs tax-free. Anything over that amount would be subject to taxes. Putting assets into a trust would reduce the taxable amount of an estate by the value of the assets in the trust.
These are only some reasons for estate planning. The estate of each Washington, DC, resident is different. The basic documents may be the same, but they can be customized for an individual's needs. Having knowledge of the legal requirements that must be included in the documents to ensure they are valid provides additional assurance to an individual that his or her wishes will be carried out upon death.
Source: rushvillerepublican.com, Estate Planning: What you need to know, Kate Thurston, Feb. 7, 2014