Trace Tyler Law | FAQ
Trace Tyler is a fun, engaging attorney who can help make painful processes a little easier. Specializing in will, trusts, and estate law in the Denver area.
wills, trusts, denver, vail, colorado
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How is property passed at death?

By Operation of Law – Joint tenancy, deed

Contract – Life insurance or bank account designations

Will/Trust – Pass your estate to heirs via trust or probate

Why have a will?

You control the distribution of your assets after your death: Who gets what, when and how, avoids delay and unnecessary expenses, specific bequests can be made for specific personal property, defrays expenses and tax liabilities of your estate and gives you peace of mind.

 

What Happens Without a Will?

The state of Colorado has a will for you – the intestate statute. Probate is a must and can delay the distribution of your estate, be expensive and inconsistent with your wishes.

For example:

  • Upon your death, your spouse survives you and you have at least one child from that spouse, she receives 100% of your estate.
  • Upon your death, your spouse survives you and you have at least one child from that spouse and one from a previous spouse, 50% to spouse, balance to surviving children.
  • Upon your death, no surviving spouse or children, parents receive 100% of the estate.
  • Upon your death, no surviving spouse, children or parents, your siblings receive 100% of the estate, in equal shares.
Who are the players in the will?
  • Testator/Testatrix – Person making and signing the will.
  • Personal Representative – Person who handles the probate process, inventories the estate, manages the assets and liabilities, distributes all property to heirs. A/k/a executor.
  • Guardian – Person who takes care of and raises the decedent’s minor children, responsible for health, education and welfare of the children. Guardian may also care for the testator if disabled.
  • Trustee – Person who manages the trust property and assets of the estate, particularly in cases of minor children. Trustee works with the guardian to ensure the children’s financial needs are met and preserves the estate.
  • Witnesses – At least two disinterested people must witness your signing of the will.
What is a trust?

One person (trustee) holds property for the benefit of another (beneficiary).

Advantages:

  • A trust can be used as a will substitute.
  • May avoid the probate process, avoiding expense, delay, publicity
  • Manages assets before and after death
  • Specify how to manage assets if incapacitated
  • Irrevocable Life Insurance Trust removes life insurance proceeds from the estate, significantly reducing the estate tax burden.

Disadvantages:

  • Expenses may be incurred in the drafting and administration of the trust.
  • If irrevocable, the grantor loses control over the assets in the trust.
  • Types of Trusts:
  • Revocable Living Trust
  • Irrevocable Living Trust
  • Charitable Trust
  • Irrevocable Life Insurance Trust
Estate Planning 101

Estate Taxes: Under current federal estate tax law, the first $5 million of a person’s estate is exempt from federal estate tax. This amount may change in 2013.  With the proper planning, spouses make use of the unified credit to shelter this amount, resulting in a total of $10 million being free from tax, which can be as high as 35% of the estate.  At these rates, heirs may lose a significant amount of the estate to federal estate taxes.  Proper planning can minimize exposure to federal estate taxes.  Estate taxes are usually due within nine months after the date of death and may require the selling of certain assets to pay the taxes due.

Other ways to reduce estate tax exposure

Annual gifts  – Gift to children or grandchildren up to $13,000 per year, per spouse.  Must be complete, voluntary and gratuitous.

Charitable gifts  – Gift appreciated assets, such as stocks, real estate, IRAs or life insurance to charitable organizations, churches, schools, etc.

UTMA/UGMA accounts – Uniform Gift or Transfer to Minors Act allows you to shift assets to minor children, which are taxed at the children’s rate.  At age of majority, the child gets control of the money.

What happens if I do not have a will?

Without a will, the state of Colorado has a will for you –  the intestate statute.  Probate is a must and can delay the distribution of your estate, be expensive and inconsistent with your wishes.

For example:  Upon your death, your spouse survives you and you have at least one child from that spouse, she receives 100% of your estate.

Upon your death, your spouse survives you and you have at least one child from that spouse and one from a previous spouse, 50% to spouse, balance to surviving children.Upon your death, no surviving spouse or children, parents receive 100%

Upon your death, no surviving spouse or children, parents receive 100% of the estate. Upon your death, no surviving spouse, children or parents, your siblings receive 100% of the estate, in equal shares.

Why engage me?

I strive to provide clients with the results and quality you expect from a big firm with the attention to detail and personal connection you can only get from a small firm.

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Serving you with commitment, respect and a few laughs.