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What Documents Do I Need In My Estate Plan?

The office of Mudge Porter Lundeen & Seguin, S.C., can assist you with an estate plan. We handle estate plans of all and every nature from the very basic to complex plans. We would appreciate the opportunity to help you with your estate planning needs.

The following is information that defines and explains several fairly common estate planning documents.

Basic Will

A will is a document containing your instructions and wishes as to how your property and assets are to be distributed after your death. A will also appoints a primary and alternate administrator who will pay your bills and taxes and distribute the rest of your estate to your beneficiaries. It can also name a guardian for your minor children. Spouses would typically leave all their estate to their surviving spouse, and if there is no surviving spouse then to their children in equal shares. If not married, a deceased person would typically leave their assets to all children in equal shares or to the next of kin or friends in case there are no children. A basic will is recommended for small estates and younger couples.

Health Care Power Of Attorney

A Health Care Power of Attorney appoints an agent and alternate agent who have the authority to make medical decisions for you when you are unable to make them for yourself. The agent is usually a family member or close friend.

Durable Financial Power Of Attorney

A Durable Financial Power of Attorney appoints an agent (attorney-in-fact) and alternate agent to make financial decisions for you when you are unable to do so due to incapacity or incompetence caused by injury, illness or aging. The Durable Financial Power of Attorney avoids the necessity of a guardianship or conservatorship proceeding in court. This document is recommended for people of all ages regardless of the size of the estate.

Marital Property Agreement

A Marital Property Agreement classifies the property as “Marital” or “Individual” and can direct how property is to be divided in the event of death or divorce. This document is usually not a substitute for a Will. It is recommended when title to assets needs to be clarified in the event there are children from a previous marriage whose rights to inheritance need to be protected either before or after marriage to set forth property distribution in the event of a divorce. This can allow the surviving spouse to receive a stepped-up basis at the death of the other spouse on assets subject to capital gains.

Wills With Trusts For Children

A Will with Trusts for Children is used when you don’t want an outright distribution of estate assets upon your death to children aged 18. Estate assets can be set aside in a trust that will be used to provide for the general welfare, including education of children until an ultimate distribution at a later time such as age 25, 30 or 35. This ensures completion of a child’s education and that they won’t foolishly spend the entire inheritance and will have financial resources available at critical stages of their adult life. This Will also appoints administration guardians and trustees to carry out the trust terms. This Will is recommended for anyone with children.

Marital Deduction Trust Wills

A Marital Deduction Trust Will is designed to maximize the Gift and Estate Tax Credit. In larger estates, several hundred thousands of dollars can be saved with this type of Will. Spouses direct part of their estate, at death, into a Family Trust with the balance given to the surviving spouse.

The assets in the Family Trust will not be subject to estate tax. They are available for the needs of the family, including the surviving spouse. The surviving spouse is also entitled to the interest income from the trust assets. This is recommended when the combined property values of husbands and wives under current law, including life insurance proceeds, retirement benefits and any amount payable as a result of death, amount to $2,000,000 or more.

Charitable Remainder Trust

A Charitable Remainder Trust is a unique way to give assets to a charitable or religious organization, get an income tax deduction for a gift, avoid capital gains tax on the sale of the asset(s) given, create a lifetime annual income for yourselves and even your children, reduce the size of your estate to minimize estate tax, and benefit a charity or religious organization. You can also replace the value of the asset(s) given by purchasing life insurance, with the annual income, through a wealth replacement insurance trust, which ensures your children will receive as much (or more) upon your death as the value of the assets given to the charity or religious organization. The assets are given to the trust and a trustee is appointed to administer the trust. This is recommended for larger estates, retired persons or those approaching retirement, anyone who has highly appreciated (or appreciating) assets and anyone who is charitably inclined.

Irrevocable Life Insurance Trust

An Irrevocable Life Insurance Trust is a way to increase wealth by making a gift to a trustee, the gift being used to purchase insurance will be paid to a child, children or a grandchild upon your death. This can be beneficial to anyone. Individuals with larger estates can give away assets to fund the trust and reduce the size of their estate while increasing the overall wealth to their heirs. Individuals with smaller estates can create additional wealth, preserve and protect assets, and provide for their heirs. The insurance proceeds paid upon the death of the individual are not part of that person’s estate and are thus tax-exempt dollars that can create additional wealth for the heirs.

Revocable Living Trust

A Revocable Living Trust is primarily designed to avoid probating an estate through the transfer of all assets to a trust during the lifetime of an individual or a couple. The principle is that if all assets are owned by a trust at the time of a person’s death, there are no individually owned assets to probate. This requires an actual transfer of assets during a person’s lifetime to a trust that will own the assets. The person creating the trust can be the trustee who will be in charge of those assets and can use them for their own benefit during their lifetime. Upon death, the assets pass to the trust beneficiaries, who are usually the heirs of the person who created the trust. The advantages are the avoidance of probate and its expense, privacy and easier transfer of assets to heirs. The value of the trust assets is not, however, exempt from estate tax. Marital deduction trust provisions can be included within this type of trust.


Annual gifting can be an important part of an overall estate plan, whether to family members, charities or religious organizations. Presently, one person can give up to $12,000.00 per year to any other person or organization without any gift tax consequence. If the gift of an asset, other than cash, is contemplated it is usually advisable to give the asset itself rather than selling it and giving the proceeds due to the income tax effect of a possible gain on the sale of such asset.

This information is provided as a public service by the law firm of Mudge Porter Lundeen & Seguin, S.C. It is intended to provide general information about estate planning and some of the documents created and concepts employed. Because the law is very complicated and there may be exceptions to any general statements, this information should not be relied upon in forming conclusions of law or making personal decisions. Because any estate plan also involves knowledge and understanding of taxation, you should consult with an accountant or a tax adviser in conjunction with the preparation of an estate plan. Attorneys or an associate accountant usually have such tax knowledge. This provides information and advice of a very general nature.

Talk With A Lawyer About The Documents You Need

For specific estate planning, consult with an experienced attorney like the ones at Mudge Porter Lundeen & Seguin, S.C. In an initial consultation at our firm, we can discuss our particular needs and the documents we need to create your unique estate plan. To schedule a consultation, call 888-365-5389 or toll-free at 888-365-5389. You can also reach us by sending an email.