Wills and Trusts in Rhode Island
Information about Wills and Trusts in Rhode Island
A testator’s Last Will and Testament, or the Will, is in place to direct to whom assets will be distributed upon the testator’s death and in what form. In the event a person dies without a Will, the assets are not taken by the state, but instead are distributed pursuant to statutory rules of descent. In our office, we have dealt with many situations where estranged family members receive portions of an estate due solely to the fact that their relative did not have a Will.
What is a “Will”?
The Will also names the person who will be responsible for administering the estate. This person is called the executor, and he or she must be officially appointed by the probate court before he or she has the authority to act, even when he or she has been designated in the Will. The executor has the authority over bank accounts, personal property, debts of the estate, and is the person responsible to make sure distributions take place as indicated in the Will.
In the event the testator has minor children, the Will usually include language appointing a guardian for the children. This is done in the event the parents of the child or children died at the same time, or when one biological parent is not a part of the child or children’s life. It is important to mention that putting the choice in the Will is not a guarantee that the person will be appointed, but the Will can be used as evidence of the deceased parent’s wishes. The family court will retain jurisdiction over the child or children and make the final decision.
What is a “Trust”?
A trust is a more detailed instrument that may be suggested for some clients. Like a Will, the trust language details how a person’s estate will be distributed upon his or her death. The difference between the Will and a trust is that the Will does not take effect until a person dies and a probate estate is opened with the probate court. A trust is most commonly used when a client owns real estate in more than one state, when tax saving provisions can be implemented, when special provisions need to be made for a special needs or spendthrift child, and when a husband and wife have a child or children from a previous relationship.
Putting assets into trust will remove those assets from a person’s probate estate upon his or her death. Therefore, a trust can also be used to avoid probate. Our office can assist our clients in making sure their assets have been correctly placed into the trust, and can provide advice regarding which types of assets belong in the trust. Trusts can also be used with life insurance policies and for charitable giving.
Trusts are not necessary in every situation, and an attorney should be consulted in order to determine whether a trust can be an effective tool in a person or family’s estate plan.
At the Law Offices of Howe and Garside, LTD, we handle estate planning and administration everyday. If you or your loved ones are in need of experienced counseling for the delicate matters of wills and trusts contact the Estate Planning Lawyers at The Law Offices of Howe and Garside at 401-841-5700 or via EMAIL HERE.
We Make Elder Law House Calls in Rhode Island
What Does a Will Cost?
We often are asked for a price quotation for a will. While we don’t want to bore you with a long diatribe, some explanation is necessary. The short answer is that the price for a “simple” will for a single person is $500. The price for a couple is $900. The flat fee quotation covers the following:
- A thorough review of your assets, your liabilities, your income, your expenses, your heirs, your beneficiaries and your goals. We ask for your data to be organized before the meeting. Even with that, the meeting normally takes an hour.
- At that meeting, we make suggestions and assist you in deciding what it is you wish to do now and what you might want to consider for the future.
- A simple will (package) includes: The will, a Durable Power of Attorney, A Medical Durable Power of Attorney, and a living will “Declaration.”
- If you wish to completely organize your “estate” and plan for the future, we offer The Beneficiary Book which is a complete checklist of things to consider in relation to your estate including your final arrangements and all other such planning. Our cost is $30 and you take it at cost if you wish. It comes in a hard copy format or a computer disc format.
- We retain your original documents in our office safe for as long as you wish at no charge.
- We provide you with a neat and indexed three-ring binder of your estate documents together with extra copies of the power of attorney documents.
- We retain your hard-file and computer files for your life-time or until you decide to retrieve your documents.
- We schedule (“Tickler file”) you for a meeting in five years which is a no-cost review to determine if your documents still meet your needs.
- Another option aside from assuming that a simple will (and related documents) is what you need is to begin by booking a complete “review and tune-up” of your estate. Depending upon your age and your health we will consider Medicaid planning, Veteran’s benefits planning, tax avoidance, avoidance of probate, etc. After that meeting we will then give you a flat fee quotation or a quotation of a “range of fees” to complete whatever documents you require. This meeting normally takes at least an hour. We will travel to you anywhere in Rhode Island for this meeting. Our flat fee for this meeting is $250.
The point is that we are not interested in drafting cookie-cutter wills and sending you on your way. We wish to create an ongoing relationship so that you can adjust your estate planning documents to your changing conditions over time. We know you can find an attorney to draft wills at cheaper prices (and many that charge much more!) but as it is ,our will practice is conducted at rates that are “more than fair” given what we deliver because we want to be your attorney for as long as you reside in Rhode Island.
Trusts Are For Everyone
Many people think of trusts as something only wealthy folks need. Indeed, there are certain kinds of trusts that benefit the wealthy for estate tax purposes. But there are also trusts which benefit people who do not consider themselves wealthy and who do not face estate tax issues.
People in Rhode Island with estates larger than $1.5 million should explore trust options which can minimize or eliminate their state estate tax liability. In Massachusetts, the state estate tax threshold is $1 million or higher.
Trusts for Other (non-estate tax) reasons:
Trusts of all shapes and sizes have the benefit of bypassing probate. Regardless of the other reasons for creating a trust, property held in the trust may be distributed upon the death of the trust’s creator (also known as the “grantor”). This takes place without the need for probate, which can be costly and time consuming. This assumes that the trust does not specify any further conditions on the disposition of the trust property, which we discuss below.
Controlling From the Grave:
While trusts generally allow for beneficiaries to receive distributions soon after the death of the grantor, the grantor may choose to create restrictions upon those distributions. For instance, where a beneficiary has a substance abuse problem, the grantor may wish to have that beneficiary’s share controlled by a successor trustee unless or until the beneficiary proves able to handle the trust assets on his own. The same type of arrangements may be made for a spendthrift beneficiary. Or there may be a disabled beneficiary whose public or private benefits would be jeopardized by an outright distribution of the trust assets. In this case, the disabled beneficiary’s share could remain in a special needs “subtrust” in order to protect those benefits.
Similar to the disability or special needs trust mentioned above, an irrevocable trust may be created by the grantor during his or her life in order to shield the trust assets from the high cost of a nursing home. While this type of irrevocable trust restricts the grantor’s control over the trust assets, this sacrificed control comes with the benefit of the trust assets being preserved for the trust beneficiaries regardless of how the grantor’s future unfolds. Note that there are certain other conditions which must be met in order for this type of long-term care planning to be effective.
Trusts also serve the valuable function of allowing another person to manage your assets if you are unable to during your lifetime. By putting your home, investments, or other property into a trust, your chosen successor trustee may manage the trust on your behalf in an emergency situation. Instead of running the risk of your loved ones having to pursue a guardianship in order to manage your affairs, your trust creates the automatic legal ability for them to do so. In this sense, a trust is much like a power of attorney but avoids some problems which often occur with powers of attorney such as institutional restrictions on their use by some banks and financial entities and the problems caused by “dueling powers of attorney” when the grantor changed his or her mind as to who would be in charge of their affairs during their lifetime.
There are many other beneficial reasons to include a trust as part of your estate plan. Please contact us to hear how a trust might make sense for you. As always, we remind you that “we make house calls in Rhode Island and Massachusetts.”
If you or your loved ones are in need of experienced counseling for the delicate matters of wills and trusts contact the Estate Planning Lawyers at The Law Offices of Howe and Garside at 401-841-5700 or via EMAIL HERE.