Estate Planning in Washington: Keep Your Fees Low and Your Plan Simple
Using available estate planning tools in Washington to accomplish your goals simply and effectively.
In Washington, It's Not So Necessary to Be Probate-Averse.In estate planning, conventional wisdom is to design a plan that, as much as possible, avoids the probate court's involvement. However, in Washington, this goal may not be as necessary as in other states. This is because, in Washington, the two main reasons for wanting to avoid probate (that probate can be slow and probate can be costly) do not necessarily apply. In Washington probate courts, processing times and costs are among the lowest in the country.
Common Devices in Washington to Keep Assets Out of ProbateIf you still want to minimize the court's involvement, however, you may want to re-title bank accounts so that they are owned jointly with right of survivorship or re-title real property with a transfer-on-death deed. Property that passes to designated beneficiaries, such as life insurance, also avoids probate.
For other property, the revocable trust has historically been seen as a valuable tool to attain the goal of avoiding probate. However, trust documents can be costly to prepare, and tedious to maintain over time.
A better fit for some clients is often a Community Property Agreement (CPA). Where a married couple or registered domestic partnership agrees that when one of them dies, all of that person's property will pass directly to the other, entering into a CPA will avoid probate as effectively as a revocable trust and without the fuss and bother.
When a Community Property Agreement Works BestThis kind of agreement works well for many couples, but it's not right for everyone. Use a community property agreement only if you want all of your property to go to your spouse or partner; have no out-of-state real property; want to keep estate planning fees low; and simplify your planning. Also, a CPA is not ideal where one spouse is in a nursing home and has qualified for Medicaid.
Pair Your Community Property Agreement With a WillIt is wise to pair a community property agreement with a basic will. A will lets you name an executor, nominate guardians for your minor children, and provide a backup plan in case you and your spouse die simultaneously. In your wills, you and your spouse should leave all of your property to each other, and then name alternates who will take the property in the unlikely event that you both die at the same time. If there are any inconsistencies between your will and your CPA, your CPA will control.
Additional Documents That Are Part of a Good PlanIt is also a good idea to make a directive to physicians, healthcare power of attorney, and durable power of attorney. A directive to physicians lays out your wishes for medical treatment in case you cannot speak for yourself. And using a healthcare power of attorney, you can name a person to make healthcare decisions for you if you can't. A durable power of attorney lets you name someone
who will take care of your finances if you can no longer do it yourself. With the durable power of attorney, you can also give the person you name the power to change or revoke your CPA. This could be very important if you or your spouse become incapacitated.
Please NotePlease note that this is not legal or tax advice. You should consult with an attorney knowledgeable about estate planning and a tax adviser prior to finalizing your estate plans.