Estate Planning Myths
Written by Christopher J. Berry, Esq. on July 29, 2008 – 5:56 pm -
Estate Planning is a very complicated area of the law in Michigan where myths abound and they can be harmful to you and your loved ones. Below is a list of common myths about estate planning.
If I have a good Will in Michigan, Michigan probate will not be required, and my assets can be transferred immediately to the beneficiaries of the Will. In fact, having a Will mandates a probate in most circumstances and the assets may not be transferred to the heirs for months or years.
Probate in Michigan is a court proceeding to transfer title from the decedent’s name to the living beneficiaries. Probate occurs in the state of your legal residence as well as any state where you own real property. The length of time to complete a Probate varies from state to state, but can take six to eighteen months, on average. Probate is frustrating to the heirs and is public record.
I don’t need a will if I have a small estate. Many people also believe that if there is no Will, all the decedent’s assets will be distributed to the surviving spouse.
If you don’t create a valid Will, the state of Michigan has a statute that will dictate where your assets go and who will administer your estate. Michigan law may not distribute your assets to the people you want to have them.
A Will covers all my assets. in Michigan, wills do not cover assets held as joint tenants with right of survivorship, retirement plans, annuities, life insurance, financial account with payable on death or transfer on death designations.
I can do my own estate plan. Estate planning is more than just creating documents. It is understanding the big picture and how the legal documents will work in concert with the assets and Michigan laws at the time they are needed.
I don’t need an estate plan because I hold all my assets jointly with another. In fact, this is one of the worst ways to plan you estate. The asset may be exposed to estate and gift taxes; it does not avoid probate, just delays it until the last owner’s death; it may cause estate, gift and capital gains taxes; it is subject to the creditors of all owners; and it will result in the transfer of the property to the joint owner when one owner dies, even if that was not intended taxes.
You can’t afford to rely on myths when it comes to your estate. Find out the facts, plan carefully and execute a plan to provide you with peace of mind and security for your loved ones.
Posted in Estate Planning, Living Trusts, Michigan Probate, Wills |
