Estate Planning For Arizona Families
Four Peaks Planning, Inc. is an estate planning firm dedicated to providing quality and affordable revocable living trust packages for Arizona families. We are experienced in helping families accomplish a variety of planning objectives.
We can team with your existing financial and insurance advisors to create a cohesive plan covering all your goals. Common estate planning goals of our clients include caring for dependent family members and reducing obstacles in transferring assets.
This website provides an introduction to the basics of how revocable living trusts accomplish various goals and how they differ from a last will and testament alone.
Our comprehensive estate plans for $750.00 include a living trust, pour over wills, powers of attorney and a deed to transfer one Arizona real estate property to your living trust. Continued support is provided after your documents are signed for both you and those managing your estate when you are unable. For those who only need a last will & testament with powers of attorney, we offer comprehensive packages starting at $200.00.
Common Living Trust Questions
- What is a trust?
A trust can be pictured as a box which can hold your assets. It is a legal entity, like yourself or a business, with instructions how to operate. If revocable, the creator of trust can terminate it at any time. If intact when the creator passes, a trust can legally operate up to 500 years in Arizona, but most terminate once its instructions have been carried out and all its assets distributed to beneficiaries.
- Why put assets in a trust?
During incapacitations, trusts can make asset management easier for financial power of attorneys and avoid the court process of a conservator being appointed. During estate transfer, trusts can control distributions for young beneficiaries, help assets avoid probate, reduce estate contests and minimize estate taxes (which affect few of our clients).
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What assets are commonly placed in a trust?
Real estate, bank accounts, vehicles, life insurance payouts and personal property are often placed into a trust, either by transferring ownership or listing the trust as a beneficiary. Tax deferred assets, such as IRAs, 401ks and annuities usually stay out of a trust for tax reasons. - What roles are there in a trust?
Trustors (also known as Grantors or Settlors) create the trust. Trustors are the only ones able to change the trust's instructions and terminate the trust.
Trustees manage trust assets for the Trustors and Beneficiaries. Trustors often appoint themselves as the initial Trustees.
Beneficiaries receive income and assets from the trust. While he or she is living, the Trustor(s) is(are) the beneficiary(ies) of the trust. When no more Trustors are living, the beneficiaries typically become family, friends and/or charities. - Do trusts prevent lawsuits or medicaid spend down?
For revocable living trusts (the trust used for most families) the answers are no and no. Revocable living trusts do not shield your assets from lawsuits while the trust's owners are living, but they can help discourage beneficiaries from contesting the trust.
Providing For A Family
One of the keys to successful estate planning when dependent children are a factor is having adequate life insurance. We do not sell life insurance but we ask our clients how their estate is prepared to cover the health, education, maintenance and support needs of children if a parent is no longer living or earning an income.
For this reason we recommend you talk to your insurance or financial advisor about life insurance (and to a lesser extent disability insurance) prior to creating an estate plan. Four Peaks Planning, Inc. can refer you to quality advisors in Arizona if needed.
Here are ways an estate plan can help a young family:
Control when money is distributed. Set age requirements for beneficiaries to receive a partial or full inheritance. Your plan can list family, friends or a professional service to approve or deny requests for early distribution based on reasonable health, education, maintenance or support needs.
Maintain assets, such as a home, for children or blended family. The person overseeing the trust (called a successor trustee) can make mortgage, utility and tax payments using money in trust bank accounts until the children finish school or, if a property is owned by the deceased spouse in a blended family, until the surviving spouse chooses to move out or passes.
Help special needs beneficiaries receiving disability income. An inheritance may interfere with disability payments. A trust can withhold their share until a partial or full distribution is needed.
Accommodate unique requests. Almost anything can be done, including estate planning for pets. You can ensure veterinary care and a good diet continue after you pass.
Simplifying the Transition of Your Estate
Probate is a common concern of Arizona residents. Probate is not a tax, it is a court process overseeing the transition of an estate. Some assets automatically avoid probate, including any asset with a named beneficiary. Life insurance and retirement accounts are common examples.
Estates with less than $75,000 of real estate and less than $50,000 of other assets avoid the full probate process. Estates with assets over that limit are subject to the process which lasts a minimum of four months and can last for years depending on a variety of circumstances.
Avoiding probate. Any asset in a living trust will avoid probate. A common motivation of Arizona residents for creating a living trust is to help their primary residence avoid the probate process if they a decent amount of equity in their home.
Minimizing conflicts. Trusts typically contain No Contest Clauses disinheriting anyone legally contesting the estate, which can freeze an estate for years and increasing the stress on the executor's job. A living trust does not prevent someone from contesting but these clauses are usually a strong deterrent.
Taxes. If your estate (including life insurance) is under $5M in 2011 or 2012 there is little worry for federal estate taxes. Portions of estates over that limit could be subject to taxes up to 35 percent. Arizona does not have a state estate tax. For most estates in Arizona, only the Trustor's final annual tax return needs filing and payment.
About Four Peaks Planning, Inc.
Since March 2004 we have been helping families as if they were members of our own family. Emphasis is placed on educating our clients to the process, the documents and topics addressed by similar families within their estate plans.
Four Peaks Planning, Inc. is licensed by Arizona's Supreme Court as a Certified Legal Document Preparer (CLDP #81353). Most estate plans can be created within one week. Evening and weekend appointments are available upon request as are in-office and in-home appointments.
Contact us for a complimentary consultation. Call 480-229-6220, email info@fourpeaksplanning.com or use our contact form below.