The Pitfalls of DIY Estate Planning

The COVID-19 pandemic has created a pressing need for estate planning and end-of-life documents. In response to this growing need and urgency, more” Do It Yourself” legal options have become available online, offering low–cost estate planning options. The DIY legal sites generally offer the four basic estate planning documents: a will, a trust, power of attorney for financial matters, and an advance health care directive. However, while financially attractive, these online forms do not always allow for a client’s unique situation and needs and therefore can create more problems that lead to disastrous results. Here is what you need to consider when deciding between a DIY legal option and an estate planning attorney:

Wills

Drafting a Will without an attorney requires that you carefully research all related state laws, such as spousal inheritance, to make sure your document is legal. You need to write your wishes very clearly to avoid any doubt which could make the will invalid and lead to litigation. Further, a Will must meet requirements for probate, speak to the payment of debts and taxes, appoint fiduciaries to administer the estate and potentially guardians for minor children.

Trusts

Trusts come in various types, such as revocable and irrevocable, and there are many things to consider when choosing one.  Do-it-yourself trusts often do not offer legal advice and sometimes do not take into consideration changes in estate planning laws. Further, they often neglect areas such as guardianship of children, property that has appreciated in value, or large estates that are subject to estate taxes

Power of Attorney

A Power of Attorney is a powerful tool that can spring into action upon your disability or be effective immediately. They should only be entrusted to a person or persons who you can trust will appropriately exercise discretion and act in your best interests, especially when you may not be able to adequately fight for yourself. The DIY online standard form often does not grant a few specific powers that could be very important if your designated person did need to use power of attorney, such as accessing a safe deposit box or setting up a trust.

Legal Jargon

While DIY estate planning options are less expensive, not everyone has the capability to create their own documents. A major area of difficulty can arise when an individual does not have a solid grasp of legal jargon. What are “heirs”? What is a “decedent”? What is meant by “fiduciary”? Misunderstanding these terms can lead to serious errors in your estate planning, such as leaving assets to unintended beneficiaries and appointing the wrong person to manage your affairs.  Similarly, legal language that is too vague or unclear can result in unnecessary conflict and litigation. 

Taxes

Online documents often fail to account for a client’s unique situation and the complexities of tax law. Estate and trust planning, litigation, and administration often require a high level of analysis and detail-oriented focus on accounting, tax laws, and asset valuations. Estate and gift tax laws also change frequently, creating potential pitfalls for clients, but an attorney who is also a CPA may be more familiar with these laws and better able to assist in getting the maximum tax savings for your estate.

More Help

When you have an estate, trust, or guardianship legal matter, you want a firm with exceptional experience and dedication to protect you and pursue the best legal outcome for your situation.

At Parisi, Coan & Saccocio, PLLC, we pride ourselves on offering select clients personalized and comprehensive estate planning, administration, litigation, and guardianship services. Our clients receive the highest quality personalized for their legal matters from dedicated attorneys with extensive experience and knowledge. Contact us for a consultation at www.pcslawnyc.com.

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