Fran Hampton Estate Planning

Estate planning involves more than a will or a trust. When properly executed, an estate plan outlines how you want your estate handled in the event of your incapacity as well as after your death. A good estate plan provides asset protection and preserves assets from undue income or estate tax burdens. F. Hunter Hampton’s solid background in taxation and estate planning, including estate planning for blended and nontraditional families and business succession planning for a family owned business, can help you preserve wealth and minimize stress for your surviving family.

The firm also offers probate, estate and trust administration services including post-mortem planning, estate litigation, contested wills, and preparation of tax returns including:

  • Estate tax and fiduciary income tax returns
  • Decedent final income tax returns
  • Gift tax returns, coordinating necessary documentation to support the values, including valuation discounts assigned to gift
  • Trust fiduciary income tax returns
  • Interim and final accountings required by probate or estate beneficiaries

Estate planning is a process to help you identify, protect and manage assets in the event of incapacity or death. Each plan is tailored to match an individual’s goals, needs and special circumstances for optimal protection, administration and efficient transfer to beneficiaries. Throughout the estate planning process, client collaboration, including collaboration with client advisors as requested, is encouraged to assure a thorough understanding of planning considerations and identifying the documents involved. Generally, an estate planning engagement requires at least three client meetings: an initial meeting to review an array of planning considerations and options; a second meeting using individualized estate plan illustrations to assist in a thorough and preliminary review of all draft documents identifying any appropriate modifications; the final meeting to review the finalized documents and complete execution.

  • Assure titling of assets and any beneficiary designations are consistent with estate planning objectives, including transfer of title into the name of a trust and that assets are titled in manner to achieve maximum asset protection
  • Collaboration with each client to verify client objectives as to distribution of assets to family members, other beneficiaries and charities
  • Identify whether distribution to beneficiaries is outright or continued in a trust for asset protection, a beneficiary’s special needs, or wealth accumulation
  • Determine whether ultimate distribution to minor descendants is time-, age- and/or incentive-based
  • Evaluate advantages of generation skipping to provide continuation of asset protection for long-term wealth preservation
  • Identify fiduciaries discussing fiduciary duties and responsibilities
  • Indexing and organizing final estate documents, titles, assignments and other estate assets supportive documents in self-contained single folio binder, allowing ready-access and ease the administrative burden on family members

Estate, fiduciary, grantor, and beneficiary income taxes can affect estate plans and influence trust and beneficiary decisions. F. Hunter Hampton strives to simplify the process; explain ways clients can minimize estate, income, and excise taxes for trusts and beneficiaries; and maintain tax deferral of retirement accounts.

Periodic Reviews
After an estate plan has been approved, executed with titles and beneficiary designations finalized, periodic reviews are recommended to ensure client goals and beneficiary designations remain consistent and accurate, assets are titled appropriately, and trusts are properly funded. During this time, clients are also advised about legal and tax law changes that might affect prior decisions.

For many people, a basic estate plan will be sufficient to provide peace of mind and aid families in the event of a loss. However, upon review of your estate, a more advanced estate plan with a trust might be recommended. A basic estate plan generally includes:

  • A simple will
  • Durable General Power of Attorney
  • Advance Medical Directive (Health Care Power of Attorney)

For your convenience, F. Hunter Hampton partners with the national Living Will Registry. Clients are registered and their Advance Medical Directives are filed with this national Registry for client convenience and easy retrieval.

Establishing a trust can be used to provide investment management, protection from creditor claims or subject trust assets to claims in a divorce. Trusts are commonly established to preserve and protect wealth and provide for minor-aged, elderly or handicapped beneficiaries. Special considerations for Trusts include the following:

Blended and Non-Traditional Marriages

Blended or non-traditional marriages frequently call for special trust considerations to satisfy client’s goals equitably and efficiently; Specialized Marital Trusts or Credit Shelter Trusts can provide for a surviving spouse/partner and children from prior marriages.

Special Needs Trust

A Special Needs Trust may be warranted to preserve eligibility for certain benefits such as Medicaid of Supplemental Social Security where a beneficiary has special needs.

Closely-Held Family Business/Investments

Trusts have traditionally been used to protect closely-held family businesses and/or investments for generations. Special care, however, must now be given to the Net Investment Income Tax because without appropriate planning, income from active business interests held in trust may also be subjected to this new excise tax.

Retirement Accounts including IRAs

Inclusion of retirement accounts, including Individual Retirement Accounts (IRAs) in trust can help protect assets until they are distributed to beneficiaries. However, care must be taken to avoid unwary income tax consequences upon the outright distribution of a share of retirement accounts to allow for continuation of income tax deferral status when there is more than one beneficiary.

Defective Grantor Trusts (i.e., GRATS)

Defective Grantor Trusts are used often in planning for larger more complex estates to transfer growth assets out of an otherwise taxable estate and minimize Gift taxes associated with the transfer.

Irrevocable Life Insurance Trusts/ Irrevocable Grantor Trusts

When planning for liquidity for more complex estates, Irrevocable Life Insurance Trusts may allow insurance proceeds to be received outside of an otherwise taxable estate. Irrevocable Grantor Trusts can also be used for life insurance and allow the grantor the flexibility of replacing life insurance with comparable growth assets.