In this paper, we will look at the anatomy of an estate plan, and we also look at some specific circumstances that may call for specialized planning. Learn more about Indiana estate plan in this presentation.
1. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 1
There are many different facets to consider when you are engaged in your estate
planning efforts. Transferring assets is not always as simple as an exercise in pie
slicing.
You should carefully consider the impact that a direct inheritance can have on
each of your loved ones. If you act in a discerning manner, you can provide for
each person that you love in the optimal fashion.
With this in mind, we will look at the value of special needs trusts in this paper.
MEDICAID COVERAGE
You have probably heard of the Medicaid program. This is a health insurance
“In this paper, we will look at the anatomy of an estate plan,
and we also look at some specific circumstances that
may call for specialized planning.”
WHAT IS INCLUDED
IN MY INDIANA
ESTATE PLAN?
PAUL A. KRAFT
Indiana Estate Planning Attorney
2. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 2
The process of estate planning is not a cookie-cutter affair. Each person is in a
different situation, and there are myriad different circumstances that can exist.
This is why personalized attention is important when the estate planning process
is underway.
At the same time, there are certain basics that every estate plan will cover.
Exactly how these necessities are addressed will vary, but the framework is
widely applicable.
In this paper, we will look at the anatomy of an estate plan, and we also look at
some specific circumstances that can call for specialized planning.
3. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 3
WILL OR TRUST
The facilitation of postmortem asset transfers is at the core of the estate
planning process. You have to make sure that assets get into the hands of your
loved ones after you pass away, and there are different ways to go about it.
Of course, there is the legal document called a last will or last will and testament.
Everyone has heard of this document, and you can state your wishes with regard
to the distribution of your personally held property through the execution of a
will.
This course of action can sound like the most efficient way to go, but there is the
process of probate to take into consideration. If you state your final wishes in a
will, the executor that you name in the document would admit the will to probate
4. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 4
after your passing.
This is a legal process, and it takes place under the supervision of a court. The
court is guided by Indiana state laws.
Probate is time-consuming, and there are expenses that can accumulate during
probate. In fact, things are
not as simple as they may
seem to be on the surface if
you use a last will as the
centerpiece of your estate
plan.
On the other hand, if you
were to use a revocable
living trust, the trustee that
you name in the document
would be empowered to
distribute assets to the
beneficiaries outside of
probate. Plus, you would not
have to allow for lump sum
distributions. If you want to,
you could include spendthrift
protections so that the beneficiaries don't burn through their inheritances
recklessly.
A revocable living trust can be a good choice for a wide range of people, but
there are other trusts that can accomplish more complicated objectives. For
example, high net worth individuals can be exposed to the federal estate tax.
This tax is potentially applicable on asset transfers that exceed $5.43 million.
There are various different types of irrevocable trusts that can be used if you are
looking for ways to mitigate your estate tax exposure. In addition to the estate
tax efficiency objective, there are irrevocable trusts that can be used to protect
assets.
Irrevocable special needs trusts can be useful if you want to set aside resources
5. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 5
for the benefit of a loved one with a disability. Many people with special needs
are enrolled in government benefit programs that are only available to people
who can demonstrate a significant level of financial need.
These are a handful of scenarios, but there are other situations that can exist
that would call for more advanced estate planning techniques.
ADVANCE DIRECTIVES FOR HEALTH CARE
End-of-life planning is an important part of the equation. Your estate plan should
include documents called advance directives for health care. One of these
advance directives is a living will.
6. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 6
A living will is used to record your preferences with regard to the utilization of
life-sustaining measures like feeding tubes, artificial hydration, and mechanical
respiration.
Another advance directive that is recommended is the durable power of attorney
for health care or health care proxy. Every possible medical contingency will not
be covered in the living will. To account for this, you can name someone to make
medical decisions on your behalf through the execution of a durable power of
attorney for health care.
FINANCIAL REPRESENTATIVE
To empower someone to handle your
financial affairs in the event of your
incapacitation, your estate plan could
include a durable financial power of
attorney. If you have a living trust,
you could empower a disability trustee
to administer the trust in the event of
your incapacitation.
SUMMARY
The specifics will vary on a case-by-
case basis, but an estate plan will
include legal instruments that
facilitate postmortem asset transfers.
A last will can sometimes suffice, but
in many cases, a trust of some kind
would be a better option.
7. What Is Included in My Indiana Estate Plan? www.FrankKraft.com 7
Incapacity planning is a necessary component. You should declare your life-
support preferences, and you should also name representatives to act on your
behalf if you were to become incapacitated at some point in time.
If you would like to put a comprehensive, well-rounded estate plan in place,
schedule a consultation with a licensed estate planning attorney.
REFERENCES
American Bar Association
http://www.americanbar.org/groups/real_property_trust_estate/resources/estate
_planning/estate_planning_faq.html
Mayo Clinic
http://www.mayoclinic.org/healthy-lifestyle/consumer-health/in-depth/living-
wills/art-20046303
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About the Author
Paul A. Kraft
Paul Kraft is Co-Founder and the senior Principal of Frank & Kraft, one of the leading law firms
in Indiana in the area of estate planning as well as business and tax planning.
Mr. Kraft assists clients primarily in the areas of estate
planning and administration, Medicaid planning, federal and
state taxation, real estate and corporate law, bringing the
added perspective of an accounting background to his work.
In addition to his practice, Mr. Kraft has lectured extensively
in the areas of living trust planning, Medicaid planning, and
presenting public and private seminars on the importance of
proper estate planning. He has also authored various articles
on estate planning and is a contributing author of LEGACY:
Plan, Protect, and Preserve Your Estate–Practical Answers
from America’s Foremost Estate Planning Attorneys.
Mr. Kraft is a co-founder of the Indiana Network of Estate
Planning Professionals, a charter member of the AmericanAcademy of Estate Planning
Attorneys and a founding member of the National Network of Estate Planning Attorneys. He is
also a member of the Indianapolis Bar Association, including the Taxation, Business Law and
Estate Planning sections; the Indiana State Bar Association, including the section on Taxation
Law; the Indiana CPA Society; and the Estate Planning Council of Indianapolis. Mr. Kraft is
admitted to practice law before the Supreme Court of Indiana, U.S. District Courts, and U.S.
Tax Court.
Frank & Kraft
A Professional Corporation
Attorneys at Law
www.FrankKraft.com
135 N. Pennsylvania Street Suite 1100
Indianapolis, IN46204-2485
Phone: (317) 684-1100
Fax: (317) 684-6111