Illinois Estate Planning and Elder Law Blog

People usually find it stressful to talk to family members about decisions they are making for their estate plan, and this can lead a lot of people to avoid having these conversations. Sometimes, a parent’s adult children won’t talk to their parents about this topic because they don’t want to acknowledge that their parent may one day become incapacitated and will eventually pass away. It can be too difficult for children to accept that their parents may be anything less than healthy and safe from harm.

The dynamics of that family may also make it harder for these conversations to take place. It’s common for one sibling to live closer to their parents and see more of the reality of the parents’ health and illness as they age while a sibling who lives far away has trouble accepting that there are any issues at all.  The child who sees their parents more often may want to have conversations about planning for incapacity or death, and the child who doesn’t live locally may see this as inappropriate or not yet needed.

An estate plan is a collection of documents nearly all adults should have in order to plan for if they become unable to make their own decisions and for when they die. This typically includes documents such as:

It is important not only to have estate planning documents in place, but also to keep these documents up-to-date as your life changes. The rule of thumb is to review these documents every five years to see if any revisions need to be made. If changes have occurred in your life since documents were last updated, it may be necessary to revise your estate planning documents. Here are some of the life changes that may prompt the need to update your documents:

1) Marriage. If estate planning documents were last revised before you got married, you’ll want to update them to include provisions for your spouse. Often, people wish to name their spouse as Executor under their Will or as primary Agent in Power of Attorney documents. You’ll also want to make sure that your spouse will receive assets under your Will.

2) Children. You’ll want to be sure to update estate planning documents when children are born, including planning for minor children (such as adding testamentary trust language and choosing guardians for them). You’ll likely want to update your estate planning documents again once your children reach a certain age as well as when they legally become adults.

People are often aware of how important it is to have complete and up-to-date estate planning documents but may not realize that where those documents are stored can be just as important and can greatly help (or hurt, if they are not stored properly).

Estate planning documents are to be used in the event of one’s incapacity and at their death. It’s crucial that those named to serve in those documents know that the documents exist, where they are located, and how to access them. The original documents will be of little use if they can’t be located. A beneficiary named in a will may be out of luck if the original will cannot be found, and some states may make this more challenging than others. In Virginia, for example, the law presumes that if an original will cannot be located, the creator of the will destroyed it with the intent that it be revoked. Trying to admit a photocopy of a will to probate can be expensive and time consuming, and this copy may not end up being accepted.

Here are some tips for proper storage of estate planning documents:

In last week’s post, I addressed why it is important to talk to your parents about planning for their death as well as some tips for how to begin this challenging conversation with them. Today I’ll share the “what” and “when” of this important conversation:

What should be covered?

There are a number of documents you’ll want to ask your parents about. Start by asking them if they have a power of attorney for finances which names an individual to make money decisions for them when they become unable to make these decisions themselves. You’ll also want to ask if they have similar documents for health care, including an advanced care directive, health care proxy, or power of attorney for health care. Also see if they have a living will to outline their wishes for end-of-life care.

If you’ve lost a parent, you’ve felt the devastating reality that everyone – including everyone’s parents – will one day pass away. Often, their children are the ones who have to handle financial responsibilities while handling their own grief. Planning in advance for the tasks that will need to be done can make that difficult time a little easier.

“We surely ought to have some idea of what we’re facing,” says Melanie Cullen, San Francisco Bay Area-based author of “Get It Together: Organize Your Records So Your Family Won’t Have To.” She continues, “On the other side of it, our parents need to know we’re interested, we care, we’re there to help.”

This week I’ll address why it’s important to have this conversation and how to bring up this topic with your parents:

Estate planning for most families typically involves more than simply naming beneficiaries. The goals of estate planning often include the transfer of assets in an orderly and tax-efficient manner as well as working to preserve wealth across generations.

The transition of wealth from one generation to the next is often most successful when there is a shared understanding of the use of the family wealth. Those family members who have created the wealth get to decide how their assets are to be distributed, but understanding and agreement from the rest of the family on how assets are to be used can help preserve wealth as it moves from one generation to another.

Reaching an agreement between family members when it comes to estate planning can be especially challenging as different people often bring different ideas and values to the table.

Last week I wrote about taking the opportunity with the changing of the seasons to begin or revisit your estate plan along with questions to guide this process. Another key component to be aware of while creating or changing your estate plan is significant changes in tax law. Here are a few to keep in mind:

Beginning in 2018, federal gift and estate tax exemptions were changed significantly. These exemptions are scheduled to be drastically reduced on January 1, 2026, but this change may occur even earlier.

Also, under the current law, income tax deferral opportunities in relation to inherited retirement accounts have been limited.