One should always use an attorney (and not simply “one-size-fits-all forms” found on the internet) to engage in the creation of wills, trusts and/or estate planning documents. In order to have a basic understanding of the key terms however, the following is a mini-glossary for your review.
Administrator: A person/entity appointed by the probate court to supervise the estate of someone who died without a will.
Beneficiary: The person designated to receive the proceeds from an estate or trust.
Bequest: A gift of cash and/or property given to a beneficiary under the terms of a will.
Codicil: A legal document that makes minor revisions to a will.
Decedent: The person who has died.
Estate tax: A tax, imposed by the federal and/or a state government on the transfer of estate property to beneficiaries.
Executor: The person/entity named to carry out the provisions or instructions of a will.
Grantor: The creator of a trust.
Guardian: A person named in a will or appointed by a court to act on behalf of minors or someone incapable of taking care of his/her own affairs.
Inheritance tax: A tax imposed by a state upon the transfer of property from an estate.
Intestate: When a person dies without a will.
Living will: A legal document in which a person declares their wishes as to medical treatment and lifesaving techniques in the case of a terminal illness or accident.
Power of attorney: A legal document that authorizes one person to act on behalf of another. A “durable” power of attorney remains in effect if the person who created it becomes disabled or incapacitated.
Probate: The court-supervised process for determining the validity of a will and governing the distribution of the estate’s assets.
Revocable living trust: A type created by a grantor to hold assets that will pass to beneficiaries without going through the probate process.
Trust: A fiduciary relationship in which a person or entity (i.e., the trustee) holds and manages property for the benefit of another person (i.e., the beneficiary).
Trustee: The person or entity responsible for administering a trust.
Will: A legal document that directs the distribution of property upon death. A will may also designate a guardian for minor children.
Remember, if you have any Estate Planning issues, do not leave it up to chance. If requested, our office can pass on the names of several lawyers that practice in this complicated area of the law.