These clients came to us from a search online. They are a blended family—the husband had kids from a prior marriage—but his children were already well off. They wanted to leave their $3.3 million estate to their shared daughter for her benefit. The best way to do that, while avoiding estate taxes to the maximum extent possible, was to create a trust. This would give them the best chance to reduce tax liability while maintaining maximum flexibility over their assets, which included shares from an LLC.

Based on their needs they chose to do the foundational/trust/tax trust package, which includes:

– Credit Shelter Trust;
– Wills;
– Powers of Attorney;
– Medical Powers of Attorney;
– Health Care Directive;
– Disposition Instructions; and
– Quit Claim Deeds moving real estate into the trust

The Credit Shelter Trust is a special type of Revocable Living Trust married couples can use to double their WA state estate tax exemption amount from $2.2m to $4.4m.

The Will does a couple of things: names a personal representative (i.e. executor) of the clients’ estates and ensures all assets get into the trust, even those the client failed to allocate.

The Power of Attorney names people to manage the clients’ finances if they are ever incapacitated.

The Medical Power of Attorney nominates people to manage the clients’ health care if they are unable to do so themselves.

The Health Care Directive tells the client’s Medical Power of Attorney what to do if they are in a vegetative state (i.e. pull the plug or not).

The Disposition Instructions state what the clients would like to happen to their remains after they are gone.

The Quit Claim Deeds transfer the clients’ interest in real property to their trust, so it will avoid going through probate.

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