Estate Planning FAQs

Why do I need an estate plan?
Everyone has the right to decide what happens to the people and things that are most important to them. Those who choose not to take advantage of this opportunity are subject to the default rules and regulations provided by government statutes or business policy regulations.

What are some basic estate planning vehicles?
An estate plan should include a Last Will and Testament. A Will distributes property that is owned by someone no longer living. A Will provides the ability to choose who will inherit this property, appoints guardians of any minor children, and names personal representatives to settle the affairs of the estate. A Will can also benefit favorite charities and/or organizations. Without a Will, the state of Nebraska decides who get whatever is left over after court costs and legal fees.

What are some more comprehensive estate planning vehicles?
Revocable trusts (sometimes known as living trusts or inter vivos trusts) should be used in comprehensive estate planning when tax planning or asset management is a significant goal of the planning process. A revocable living trust is formed to hold title to real and personal property of the creator during life. (See Illustrations for more examples)

What are the benefits of having a Revocable Trust rather than Last Will and Testament?
Revocable living trusts can be used to enhance estate settlement and avoid the probate process. Revocable living trusts provide for the orderly use and transfer of the real personal property upon the creator’s death.

Do I need any estate planning documents while I am living?
Yes. Any adult over the age of 19 should consider executing a power of attorney. Power of attorney documents name those individuals that will make decisions for you regarding your health care and/or assets if you become incapacitated. Power of attorney documents can include a HIPAA waiver, as it allows your loved ones, hospitals and insurance companies to obtain vital information about your health if you are incapacitated and unable to sign the waiver due to incapacitation. If power of attorney documents are not executed, others outside of your control will make decisions over your health care and property. (See Illustrations for more examples)

What is the difference between a power of attorney for health care and a living will?
A Living Will declares the end of life decisions made by an individual that determine whether that individual’s life shall be artificially prolonged under a certain set of circumstances. Making this decision in advance and in writing protects loved ones from making the decision under emotional distress. A power of attorney allows you to appoint an Attorney-in-Fact to exercise a list of powers, as described in the power of attorney document, including making medical decisions on your behalf upon incapacitation.

Business Planning FAQs

What is a limited liability company?
A Limited Liability Company is a non-corporate business entity formed according to Nebraska State statutes that provides owners protection against unlimited personal liability from creditors and third parties. The owners, not the entity, are responsible for the payment of the tax, if any. A limited liability company is typically established instead of a corporation if the owners would like the business to be structured more informally. It can be run as a partnership or structured similarly to a corporation. An LLC is established to holding business interests.

Why/when would I need to establish a domestic corporation?
The main reason for establishing a corporation is to have tax implications in addition to the protection it provides to the shareholders.

What is the difference between a Sub-S election and a C-Corp?
A Sub-S election is typically established for businesses with 75 employees or less. This type of corporation provides “pass-through” taxation so that employees/shareholders/operators will be taxed at their level and dividends are taxed at a different level.

A C-Corp should be developed for large companies. In this type of corporation, the shareholder is taxed more than in a Sub-S election. In this larger type of corporation, there are more shares issued; therefore, the tax burden becomes more diversified.

When would a partnership need to be formed?
Partnerships are formed when a business would like to be structured informally. All owners are equally liable for debts and assets. There can be two types of partnerships formed: a limited partnership and a general partnership. Owners can limit their liabilities through a limited partnership. In a general partnership, partners have to bear all liability. There are not usually tax implications involved when forming a partnership.