For Illinois Residents

A Will is an integral part to every estate plan, but it is important to remember that a Will only applies to probate assets and will not determine who receives property that passes by beneficiary designation, contract or operation of law. Estate plans designed to avoid probate by utilizing a revocable/living trust should include a Will in order to capture any property that inadvertently did not get transferred to the trust during lifetime.

A Durable Financial Power of Attorney names the person who may make financial decisions for you in the event you are incapacitated. This document avoids delays in asset management as well as the cost and potential embarrassment having a court proceeding to appoint a guardian of your estate. You may be expansive in the powers you grant to your agent in a document I draft on your behalf.

A Healthcare Power of Attorney names the person who may make healthcare decisions for you in the event you are incapacitated. This document avoids the cost and potential embarrassment of the necessity of a court proceeding to appoint a guardian of your person who can make those decisions for you. A healthcare Power of Attorney document addresses life support and feeding tubes and when your agent may withhold them in the course of your medical care.

The Health Insurance Portability and Accountability Act of 1996 (AHIPAA@), 42 U.S.C. ‘1320d and 45 C.F.R. parts 160 and 164 (AThe Privacy Rule@) created rights with respect to the non-permissive release of your medical information. As such, under the law you must appoint a representative to access your medical records when you are unable to do so for yourself or when you desire to allow that person to be informed. In many cases, I like some other lawyers, take the conservative position that a person must be appointed a representative under HIPAA in order to implement the determination that you not competent to handle your own affairs such as under a Durable Financial Power of Attorney document.

In Illinois the form is called a “Declaration.” A Living Will instructs your physician regarding withholding or withdrawing death delaying procedures when you are determined to be in a “terminal condition” as determined by state law meaning that your death is imminent except for the death delaying procedures. This document will instruct a physician with respect to the withdrawal or withholding of those death delaying procedures. This document may save family members from having to make difficult and often painful decisions during a time of stress.

Trusts are the most flexible estate planning document available. A Trust may be created during life (called an intervivos trust) or by your Will (called a testamentary trust).

Trusts can be created for many different purposes, for example: to manage your property, make gifts of your property to family members or to charities, manage assets for minor or incompetent beneficiaries or until a beneficiary attains a certain age, provide for the needs of a second spouse during his/her lifetime with assets passing to the children of a first marriage upon the second spouse’s death, or provide for the supplemental care of a disabled individual or an elderly person while allowing him/her to qualify for public assistance, or a pet trust for the care of your animals.

There are certain types of trusts that are irrevocable and other types are revocable (such as a “revocable living trust’). Other trusts are treated as a gift to the beneficiaries yet all of the income and expenses are reported back on the grantor’s personal income tax return (these are called “Grantor Trusts”).