Probate is required when a person dies with assets held in his or her own name. It is a court process that controls the transfer of the assets of a deceased person to his or her loved ones. This process involves the submission of a deceased person’s Will with the court along with a petition for probate and other court forms in order secure the allowance of the Will and the appointment of a personal representative (executor) of the estate. The probate process can also involve the filing of an Inventory or list of the assets of the deceased person with the court. Probate is an expensive and time-consuming process that can be avoided with proper estate planning.

A living trust is a revocable trust designed to eliminate the need to probate a deceased person’s estate. The person establishing the living trust is typically the trustee and beneficiary of the trust and he or she can amend or revoke the trust at any time. A living trust allows the trustmaker to control his or her assets during their lifetime while minimizing estate taxes and avoiding probate. The living trust also makes provisions for the trustmaker in the event of his mental incapacity. The living trust also provides the terms of distribution of assets to the trustmaker’s children at death. A living trust plan should also include a durable power of attorney, a pour-over Will, a health care proxy and trust funding instructions.

Yes. A properly established and funded living trust will enable a deceased person’s family to avoid the costs and delay of probate. A living trust also eliminates continued probate court involvement in the administration of trusts established in a Will for a child or a disabled person. A living trust for married couple can also be designed to minimize estate taxes.

If a person has a Will based plan, any assets in his or her name at death must go through probate in order to transfer the assets to their loved ones. Probate involves petitioning the court and submitting the Will for allowance and appointment of the personal representative. Any trusts established under a Will must be supervised by the probate court until fully distributed. If a person has no plan at all then his or her estate must also go through the probate process in an intestacy proceeding.

The estate tax (death tax) is a one time tax that is levied on a deceased person’s assets. Both the federal government and Massachusetts have estate tax laws. The estate tax is assessed on all assets, including, real estate, investments, bank accounts, life insurance policies, IRAs and 401Ks, annuities and personal property. Proper planning through the implementation of living trusts, gifting trusts and, if needed, other sophisticated planning techniques, including gifts and sales of discounted assets to grantor trusts and spousal lifetime access trusts, can reduce or eliminate estate taxes.

Persons who own a business or own commercial or residential rental property should be concerned about liability from personal injuries occurring at the business or property. To protect personal assets from claims coming from the business or rental property a corporation or limited liability company is often recommended. Both corporations and limited liability companies are established by the filing of organizational documents with the Secretary of State of the state where the business is located.