The one page document contains the following information:

1.  The State and County the Estate was filed;

2.  The name of the Decedent (person who died);

3.  A statement that the application has been reviewed and the Court “adjudged legally sufficient the qualification of the fiduciary (Executor)”;

4.  The name of the Executor ;

5.  The date of the appointment (the date that the Clerk of Court signed the Letter);

6.  The raised seal of the Court

Once this Letter is issued, it will need to be provided to whatever institution the Executor will need in order to collect the assets.  It also needs to be provided if the the Executor needs to obtain information on an account or other asset.

In North Carolina, the Court provides five (5) Letters Testamentary which is included in the filing fee of $88.00.  If the Executor needs additional ones then they are $1.00 each.  For a list of additional Court fees please see http://tinyurl.com/probatefees.

Keep in mind that unless the Court is satisfied with the initial filing documents, the Letters will not be issued.

Here are a few of the top 5 estate planning mistakes that people make that can be avoided.

1. Dying without a will or trust - If you die without a will or trust, the state in which you reside and the IRS will simply make one for you.  Of course, they have no interest in avoiding or reducing estate taxes, minimizing estate administration costs or protecting your family and legacy. The distribution of your assets will just be turned over to the Probate Court. The probate process is needlessly time consuming, frustrating and expensive. It is also open to the public, meaning creditors, predators or anyone else will have complete access to all information about your estate. For the vast majority of people, the benefits far outweigh any initial costs.

2. Having an “I love you” will – An I love you will is one in which all the decedent’s assets have been left to the spouse. On paper, it might seem to be a caring, thoughtful gesture, but the reality is quite different, because such a will simply passes the complex issues and problems associated with transferring and protecting wealth onto the spouse or other loved ones.  It creates more problems than it solves, particularly for future generations.

3. Giving property outright to your children – Here is another solution that might sound good at first, but ignores several important realities. For instance, what if the child in question is too immature to handle the responsibility of a large sum of money on his or her own? What if the child suffers a severe financial setback that puts the inheritance at risk to creditors?  What if the child marries a fortune-hunter, is addicted to drugs or alcohol, gets divorced or remarried? You may need to protect your children and heirs from their own poor decisions.  These assets are also gifted assets which carry potentially large IRS penalties if not handled properly.

4. Owning property jointly – There are two types of joint ownership, Joint Tenancy with Right of Survivorship (JTWROS) and Tenants in Common (TIC).  Problems with JTWROS include postponement of probate only until last tenancy, the loss of the double step-up in tax basis creating more to pay in capital gains taxes, and outright distribution.  With TIC, you also lose the double step-up in tax basis where it’s available, and your property is subject to the estate plan of each tenant as well as probate for each tenant.

5. Not having a trust – A trust is the single most effective estate planning tool available. There are many different types of trusts.  Among the better known and more commonly used are revocable trusts, irrevocable trusts and testamentary trusts. A Trust protects your privacy, and will help you leave what you want, to whom you want, in the way you want at the lowest possible cost overall.

Items to Find and Secure:

1. The Last Will and Testament and Trust Documents
2. Keys to safe deposit box
3. Life insurance policies
4. Business partnership agreements
5. Decedent’s checkbook
6. ATM card
7. credit cards & address book
8. Bank account statements
9. Marriage certificate
10. Veterans records
11. Retirement plans and employment records
12. Tax returns
13. Important & valuable family keepsakes

Items to Collect:

1. Current monthly bills
2. medical bills
3. bank statements
4. Checks received in the name of the decedent
5. Keep receipts for funeral expenses and any “out of pocket” estate expenses. Executor should accumulate list of assets and liabilities and debts
6. Note due dates on bills
7. Note the legal title descriptions on all accounts, assets and debts
8. Take pictures of home for quick inventory of contents (with no surviving spouse)

Contacts to make:

1. Family and Friends that could not be reached for funeral
2. Minister, priest or other support resource
3. Estate Attorney
4. Executor or Attorney to deliver Last Will & Testament to probate court
5. Accountant
6. Social Security
7. Veterans Administration
8. Insurance companies (regarding life, health, property insurance & annuities)

Family Care Issues:

1. Be mindful of family member bereavement issues and healthcare
2. Maintain security of home and property
3. Note family “issues” or disputes
4. Spouse may use joint account to pay bills, but others should not use decedent’s checkbook, credit cards or ATM card or auto
5. Consider a memorial or donation that the; family, beneficiaries and Personal Representative believe to be a fitting remembrance.

Starting the Probate Process and Responsibilities:

Getting the Last Will and Testament to the probate court will allow the Personal Representative (upon appointment) to pay bills. Probate assets (assets held in decedent name) or personal property items should not be distributed to beneficiaries without court approval. Executor, Personal Representative (or Attorney) should maintain possession & control of property and all important records and documents.

Contact Sabrina Winters, Attorney at Law, PLLC at (704) 843-1446 and will would to assist you and answer any questions you may have.

The reason they had come to me was because they wanted to see if their Will had included the new child they had a few months before.  They already had two children when they made their on-line will and had not anticipated having any additional children.

What I found after reviewing their self drafted Wills was that they were missing language that allowed for any future children to be included in their estate.  The end result would have been that their current two children would inherit but their new baby would not!!!  This would be ok,  if that was what they wanted, but it wasn’t.

Our Firm corrected this and added many additional provisions.  Now they have an Estate Plan that will not only work when the time comes, but will grow with them over the next few years.

It is hard to deal with our own incapacity and death when we are well, but there were many in the room battling cancer and truly needed for me to guide them in something they felt they had some form of control over. It was humbling for me to see people (there was standing room only!) who were exhausted from chemotherapy or in remission, but made it to a 6:30 p.m. event (to listen to me none the less!) because they knew how important it was.  These people are no different than you and me, except that they have a sense of urgency because life has dealt them a challenge.

Read the full letter here along with other client and colleague testimonials.

According to the North Carolina Court System Website:

“A will is a written document in which you direct who is to receive your property upon your death. If you have any real property (land) or personal property (cars, jewelry, money) that you want to give to a specific person you must have a will. Otherwise, the property will pass to persons in accordance with the Intestate Succession Laws.”

Which then begs the question, what are Intestate Succession Laws?

Again, the North Carolina Court System offers a definition:

“These laws set forth how property is to be distributed when someone dies without a will. Generally, the property will pass to your surviving spouse and children, but not in equal shares.”

So why have a will? If upon your death, you want to give your real property or personal property to a specific individual, or individuals, then you need a will. Otherwise, the Intestate Succession Laws will dictate how your property is distributed upon your death.

You might think that you can write your own will, or use a “do-it-yourself” will form to assist you in writing your own will. Typically, this is a bad idea.

Now you might be thinking, “But you’re an estate planning attorney, of course you think writing my own will is a bad idea. You want my money!”

Well, don’t take my word for it. Take the recommendation of the North Carolina Courts:

“You should contact a lawyer for assistance in making a will, to ensure that it is properly drafted and correctly signed and witnessed. If a will is not prepared as required by law, it may be deemed invalid. An invalid will is useless, and your property will pass to your heirs by Intestate Succession.”

While drafting documents is important and necessary, building lifetime relationships with my clients is just as important. Submit your request for a free North Carolina estate planning phone consultation. I would be happy to discuss with you the best way to ensure that your property passes according to your wishes.

The Wall Street Journal has a great article that shows how important it is to review and update your documents regularly.

I can tell you how bad the results could be, but I thought you could read for yourself a true story posted by attorney Jeffrey A. Cramer in Florida on how bad the results actually were.  If you have children, I will bet that you won’t even think about a “do it yourself” Estate Plan after you read below.

“Another Horror Story From the Real World”

The lesson to learn from this tragedy is that you should partner only with advisors that are experienced and caring and that have only your best interest at heart and care about your future and not the size of their fees.