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A
PYRAMID
APPROACH TO
ESTATE PLANNING
I. The Ohio Estate Planning Pyramid
A. Last Will and Testament
1. Choice of Executor
2. Choice of Guardian
3. Authority of Executor
4. Distribution of assets
B. Nonprobate Property
1. Payable on death designations
2. Transfer on death designations
3. Joint ownership, with a right of survivorship
C. Living Trusts
1. Revocable vs. Irrevocable
a. Trustor
b. Trustee
c. Beneficiary
2. Inter vivos (living) vs. Testamentary
3. Grantor vs. non-grantor (for IRS purposes)
4. Purpose of Trust:
a. Control of assets after death.
b. Privacy
c. Avoid Probate/Simplify Administration
d. Long term care planning/Medicaid or Veterans benefits eligibility
e. Income Tax or Estate Tax planning
D. Estate Tax Avoidance Trusts
1. A/B (credit shelter) trusts for married couples
2. Irrevocable insurance trusts
Note: gift of asset if Crummey withdrawal right is not exercised.
3. Charitable Remainder/Lead Trusts
4. Generation Skipping Trusts
E. Gifts
1. Gift Tax annual exclusion:
a. Federal: $13,000.00 per year, per person.
b. Ohio: $10,000 per year, per person, if death is within three (3) years of gift.
2. Gift Tax lifetime exclusion: $1,000,000.
F. Durable Powers of Attorney
1. Financial
a. Durable vs. Non-durable
b. Springing vs. Effective immediately
2. Health Care
a. Choice of guardian for self, and for a dependents or minor children.
b. Living Will type decisions.
c. Priority of power of attorney over Living Will Declaration.
G. Living Will
1. Life support issues
2. Use of feeding tubes and hydration tubes
3. Do Not Resuscitate Orders
4. Organ Donation considerations
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