By Associate Attorney Danielle Nodar
During this time of uncertainty, people may question whether they have their affairs in order to better protect themselves, their loved ones, and their assets in the event that a worst-case scenario occurs such as incapacity brought on by illness or death. Below is a short list and description of important documents that can help complete an estate plan.
The documents that deal primarily with distributing assets at death are a will or a revocable living trust. The best type of document for a given individual depends on a variety of factors such as family situations, the type or amount of assets, and overall goals for estate planning, but both documents allow you to have control over who will be responsible for carrying out your final wishes and ensuring that your assets are distributed to the beneficiaries you have named in your documents.
For parents, there are also important decisions relating to caring for your children if you pass away. Unless you have a terminal illness, the only way to name a guardian for your children in North Carolina is to do so in a will. When appointing a guardian for a minor, the court will give preference and priority to the person named as guardian in a will. By law, a child can inherit property outright and with no strings attached upon reaching the age of eighteen, regardless of the amount or type of property. With proper estate planning, your will or living trust can outline specific age restrictions or conditions on when your child can inherit your property while ensuring that all expenses relating to your children’s health, support, maintenance, and education are taken care of by a trustee.
A durable power of attorney allows you to name an agent to act in your place and make financial, business, and legal decisions if you ever become incapacitated (i.e. unable to handle your affairs). In the absence of naming an agent, a loved one would have to petition the court to be appointed as your legal guardian. The guardianship process is much more cumbersome, time-consuming, and costly than executing a durable power of attorney in advance.
A health care power of attorney allows you to name an agent to make medical decisions on your behalf in the event you cannot speak for yourself. This document is not necessarily an end-of-life document, as it can apply in any situation where you are unable to communicate your wishes to a physician, such as being under anesthesia. You may give your agent full authority over decisions relating to your physical and mental health or limit your agent’s authority by providing
explicit instructions in this document.
An advance directive, also known as a Living Will, is an end-of-life document where you will state under what conditions and terms you do not want to be kept on life support such as a ventilator, artificial nutrition, and artificial hydration.
In the absence of a Health Care Power of Attorney or an Advanced Directive, North Carolina law sets forth an order of priority (family members) as to who can consent to medical treatment on your behalf in the event you become incapacitated. This can cause problems for people with interesting family situations or no family at all. There is no default decision maker under North Carolina law for business, financial, and legal decisions, so a durable power of attorney is one of the most important estate planning tools we draft.
With all of these documents, timing is everything, as the signer must have capacity at the time of signing. You cannot “get power of attorney over” someone. If you are interested in discussing your estate planning goals or needs, please contact Jesson & Rains.
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