Have you ever notice how every field of study, business or professional discipline has its own language? Typically, this “insider” vocabulary conveys rather elaborate concepts in a word, phrase or acronym. So it is with estate planning.
While what follows is by no means exhaustive, here is a list of common estate planning terms.
Attorney in Fact: Someone who is given authority through a Power of Attorney to do a particular act or to act broadly for another. An Attorney in Fact need not be a member of the legal profession and is also known as an Agent.
Codicil: An amendment to a Last Will and Testament. The Codicil may modify, add to, subtract from, qualify, alter or revoke provisions of a Last Will. As such the Codicil is a separate document that must be signed with the same legal formalities as the Last Will itself.
Conservator: Someone appointed by a court to manage the financial affairs of a minor child or an incapacitated adult.
Deed: A conveyance of real property (real estate) transferring title from the Grantor to the Grantee.
Estate Taxes (also known as “Death Taxes” or “Inheritance Taxes”): Taxes imposed by the state and/or federal government on the inheritance or transfer of assets upon the death of the asset owner. The amount “exempted” from such taxes is subject to the political winds which, historically, have fluctuated wildly, especially over the past several decades.
Executor: The individual or institution appointed under a Last Will and Testament to administer and distribute the assets of the maker of the Last Will. Also know as a “Personal Representative,” the Executor has legal and business powers and responsibilities, while functioning under the control or supervision of the probate court. An “Executrix” is a female Executor.
Guardian: Someone appointed by a court to manage the personal and health care decisions of a minor child or incapacitated adult. Oftentimes, the Conservator and the Guardian are one in the same person.
Intestate Succession: The transfer of property to the relatives of a decedent who died without a Last Will and Testament. In most states a statute will specify which relatives receive intestate shares, what they receive and when they receive it. This is the unintended default estate plan for many adult Americans.
Joint Tenancy: A form of property ownership by two or more persons designated as joint tenants with rights of survivorship. When one joint tenant dies, his or her entire interest in the property automatically passes to the surviving joint tenant or tenants outside of and beyond the control of the decedent’s Last Will and probate until there are no more surviving joint tenants. Then, there may be probate.
Minor: A person who is under the age of legal competence. This varies from state to state.
Tenancy in Common: A form of ownership through which each tenant (i.e., “owner”) holds an undivided interest in the asset. There is no “right of survivorship” (see “Joint Tenancy”). When one tenant dies, his or her interest will not automatically pass to one or more surviving joint tenants.
Again, estate planning is a language all to itself. These are some of the most commonly used terms, but there are many others to be sure.
© 2020 Legacy Law Center