Estate Planning as a Safety Net for Unexpected Accidents
Developing an estate plan should be on everyone’s to do list. Not only is this important for the future of your assets and avoiding probate, but it allows you to state preferences that may not otherwise be obvious. Most people create an estate plan so they have peace of mind that what they have built over a lifetime is protected. And there are documents within an estate plan that can be used in specific circumstances. Such as in the event of an unexpected personal injury accident, where a person’s preferences about medical care and life support can be abided by, since they will have outlined it in their medical directive. Below, our friends at Cohen & Cohen offer more insight into estate planning, probate, and the impact of personal injury accidents.
What Happens During Probate
No probate process is the same as another, however, there are common elements that tend to apply. During probate, estate assets are evaluated, creditors are notified, litigation occurs, and taxes are handled. The process of locating, identifying, and safeguarding estate assets starts shortly after someone passes away. Family members and executors of the estate have to ensure assets are transferred to beneficiaries and/or legal heirs accordingly. Creditors are notified about the probate process and each claim must be thoroughly examined. If someone challenges a will, then litigation will happen. Lastly, taxes such as estate taxes and federal gifts have to be calculated and paid, in addition to an estate tax return.
Establishing an Estate Plan
Many people think about the future of their lives and those around them when establishing an estate plan. This is a great way to set forth instructions for to whom and what assets you want distributed after you have passed on. Examples of estate planning documents include power of attorney, last will and testament, advanced healthcare directive, life insurance policies, trusts, guardianship, HIPAA authorization, retirement accounts and annuities, titles and property deeds, and more. Depending on your situation and future wishes, you may or may not need to have all of these documents.
Personal Injury Accidents
Another reason people establish an estate plan is so that in the event of an unexpected injury, their family would know what their preferences are in regards to medical care and life support. For instance, if someone was involved in a serious car accident and was so injured they were unable to communicate their wishes and preferences, then their family would refer to a medical directive in the estate plan. This document can be shared with your car accident lawyer, and would state how that person wants medical choices to be made if they become incapacitated or lose the ability to make decisions for themselves. While not one wants to imagine this reality unfolding, being prepared just in case can provide relief to close relatives who may not be able to make confident medical choices in that kind of situation.