Estate Planning Frequently Asked Questions
A Will is a legal document that appoints an executor to handle your final affairs after you pass away as well as designates your beneficiaries (the people who inherit your money when you are dead). A Trust does the same thing as a will, but the mechanism is different. A Trust is like a setting up a personal corporation for yourself and your family. You will designate who your successor trustee is, and that is the person who manages your affairs once you pass away and will identify your beneficiaries or who will inherit what from you when you are dead.
There a lot of differences between the documents and how they are managed despite them doing similar things. The main differences are:
- Wills: A will must go through probate court when you pass away. Probate court is a legal process in which the assets and debts of a person are determined, their wishes are acknowledged, notice of their death is published, and claims, if any, are filed against the estate. If you have a will and you pass away, your executor must file your will with the court system along with several other documents to open and complete the court case. While you do not need to hire an attorney for the probate process, most people do as it requires 3-4 court appearances and between 10-20 legal documents to be filed. The probate process from start to finish typically takes one year and most attorneys charge between $2,500- $10,000 depending on the level of complexity to the estate.
- Trusts: When you pass away, your successor trustee automatically takes over the Trust without having to go through probate court. Generally, Courts do not get involved in the administration of trusts, only wills. As such, Trusts are often used to “bypass” the probate the process in Illinois. There are exceptions this rule, but generally having a Trust will prevent the Court system and lawyers from getting involved in the process.
- Level of detail:
- Wills: A Will allows you to assign certain assets and percentages to your beneficiaries, but it does not allow you set up extended distributions such as: “no child of mine shall receive their inheritance until they reach the age of 25.”
- Trusts: Allow for greater details and separate trust accounts for minor children, dependents with special needs, and designating real estate to specific people.
An irrevocable trust is used most commonly when you expect to need long term care in a nursing home or similar type facility and you are willing to go into a Medicaid facility. This type of trust requires you to transfer all of your assets out of your name during your lifetime and that action is irreversible. So long as you do not need long term care in the next five years, the irrevocable trust can help protect your assets from claims from Medicaid or Medicare.
We try not to steer our clients in one direction or another when it comes to deciding between a Will or Trust. Wills are cheaper to form in the beginning but because Probate is both timely and expensive, a Will ends up costing more in the long run than a Trust. Trusts tend to be lifetime documents, meaning once established they exist forever but need to be updated as your life changes. During your free initial consultation, our attorneys can help explain more in detail the differences between the two documents and help you come up with a plan that fits your needs and your budget.
No- it is not required to have a will or Trust in the state of Illinois. Wills and Trusts are helpful for grieving families when they lose a loved one. They not only spell out exactly who is to get what, but they provide clarity and direction about how many assets a person has, who they want to help raise their children, and what charities are important to them.
Your loved ones will have to open a probate case with the local Court and the intestacy statutes of Illinois will govern who gets your money now that you have passed away. Typically, money is awarded to legal spouses and children (both biological and adopted, and then to brothers and sisters and parents after that. If no one is able or willing to act as an Executor, the Court will appoint one and their fees will be deducted from the estate.
Fees for our packages are outlined on our website and noted above.
A Transfer on Death Instrument (TODI) is a document that gets recorded on your property, much like a Deed. Instead of transferring the property immediately to the Grantee like a Deed does, the TODI become activated upon the death of the last to die of the Title-holders. Once activated, the TODI transfers all interest in the property to the beneficiaries listed so that the home can be held, or sold, without going through the probate process. This is the easiest and most beneficial to those people who do not have a lot of financial assets or who wish to keep their home out of probate.
The initial 30-minute consultation is free. Additional consultations beyond that and prior to hiring us for services will be billed hourly at $300 per hour or will be included in the package you choose.
If you have any wills or trusts (no matter how old), you should bring those with you. Otherwise, we will send you home with homework and information that we need to move forward depending on the direction you choose to go in.
Once we get final drafts completed, you will come to the office in person, and we will witness and notarize your signatures on all documents. Once they are signed and witnessed as required by law, they are valid documents.
No. Illinois wills and trusts are accepted in every jurisdiction in the United States of America. However, probate rules in states vary and therefore an Illinois trust will look different than a trust drafted in North Carolina. If you plan to move out of state permanently in the near future, we recommend you setup your estate plan with an attorney in the location you plan to move to.
All assets over $50,000 except for IRAs, checking accounts and vehicles. The beneficiary of those accounts should be listed as the name of your trust. As an example: Lauren’s investment account with Ameritrade does not have her husband listed as the beneficiary. It has the “LoMonaco Revocable Trust” listed as the beneficiary. When Lauren dies, her husband becomes the sole trustee and beneficiary of that Trust and therefore of her Ameritrade account.
Wills cannot hold assets while you alive or dead, so you do not need to change anything to adjust for your will. However, you beneficiaries on your account should match your beneficiaries in you will.
It depends on how quickly you provide us with the information we need to get everything drafted for you. Typically, from start to finish it is 1-2 months process.
It is not valid until it is signed, notarized, and witnessed by two people who cannot inherit from you. If you pass away before the document is fully executed, it is invalid and holds no merit in any Court.
You do not need to hire a lawyer to draft your Will or Trust. The benefit of using a local attorney as opposed to a website is customer service and continuity or care. We often have clients contact us after paying for a website to draft their documents because they do not understand them, do not know what they mean, and do not know how to explain them to their children. They also do not have any way of updating them if their life changes a few years down the road. At LoMonaco Law we pride ourselves on being lifetime partners to our clients. All of our attorneys are born and raised in the Chicagoland area and love having repeat clients and growing with our clients as their needs change. Our clients also find it comforting to know that when they do pass away, there will be an actual person with a phone number and an email that they can contact any questions about the documents or process.