Many people believe that estate planning is very complicated–and therefore, do not make it a priority in their lives. However, once you learn some of the basic terminology associated with estate planning, it will begin to make more sense to you. You will soon discover the importance of estate planning and why it is vital to get started with your estate plans sooner rather than later.
The California estate planning attorneys at Galanti and Copenhaver can help you with your legal needs. Our attorneys have handled many different estate-related cases over the years. Contact our office today to schedule a consultation with one of our attorneys to discuss the questions and concerns you have regarding the estate planning process.
An administrator is the individual or corporate fiduciary that is appointed by the court to manage an estate if there is no executor or personal representative already designated. The court may also name an administrator if the named executor or personal representative is unwilling or unable to fulfill these duties.
A beneficiary is a person who is designated to receive the benefit of property from an estate or a trust.
A codicil is a formally executed document that serves to amend the terms of the will. Using a codicil gives you the opportunity to avoid having to rewrite your will.
A decedent is a person who has died.
Descendants are a person’s children, grandchildren, and other more remote persons who are related either by blood or through legal adoption. A person’s spouse, stepchildren, parents, etc., are not descendants.
6. Estate Planning
Estate planning is a process by which a person designs a strategy for and executes a will, trust, or other documents in order to provide for the administration of their assets upon their incapacity or death.
7. Estate Tax
An estate tax is a tax that is imposed on an individual’s transfer of property after they die. More than twenty states have state estate taxes that are different than the federal system taxes, so even if your estate is not subject to a federal estate tax, depending on where you live, you may be subject to an estate tax.
An executor is someone who has been named in a will and appointed by a court to carry out the terms of a will. The executor is also will administer the estate of the decedent. The executor may also be referred to as a personal representative.
A fiduciary is a bank, trust company, or individual designated to manage property or money on behalf of beneficiaries. A fiduciary is required to exercise the standard of care that is set forth in state law and governing document under which the fiduciary acts. Executors and trustees are included as fiduciaries.
A guardian is either an individual or a bank or trust company that is appointed by the court to act on behalf of a minor or incapacitated person. A guardian of a person is empowered to make personal decisions on their behalf. A guardian of the property is responsible for managing their property.
An heir is a person who is entitled to a distribution of an asset or other property interest under state law, in the absence of a will.
When a person dies without a valid will, they are said to have passed “intestate.” Their estate will then be distributed in accordance with the state’s intestacy law.
13. Irrevocable Trust
A trust that cannot be revoked, terminated, or otherwise amended or modified by the grantor (unless certain exceptions apply).
14. Living Trust
A living trust is created by a person during their lifetime, typically as a revocable trust. It can also be called an “inter vivos” trust or a “revocable living trust.”
15. Power of Attorney
A power of attorney is an authorization granted by a written document that one person may act in another person’s place as an agent or as attorney-in-fact with respect to some or all financial and legal matters.
Probate is the court-supervised process of providing that a will is valid and distributing the property according to the terms of the will, or in accordance with the state’s intestacy law if there is no will.
17. Revocable Trust
A revocable trust is one that is created during a person’s life, over which they reserve the right to modify, amend, terminate, or revoke.
Settlor is a term used for a person who establishes or settles a trust. It has the same meaning as “grantor.”
A testator is a person who signs a will.
A will is a document that specifies the beneficiaries who are to inherit the testator’s assets. A will also typically names a person to administer the estate and have the responsibility of distributing assets to the beneficiaries.