Illinois Estate Litigation

Common estate litigation involves disputes over the validity of a will or the meaning of a valid will. There are also disputes over who the heirs or legatees are or over who owns property claimed by the estate. Litigation where an interested party charges the executor or administrator with wrongdoing is also common.

There are also suits by estates to recover amounts owed or for wrongful death. Similarly there are suits against estates for amounts owed or for property damage or personal injuries.

The only common denominator is the expense. Litigation is very expensive. Unfortunately litigation involving family members is often not rational and the costs escalate way out of proportion to the amount involved. One way to avoid family litigation is to consult everyone about everything and to act only when there is some kind of consensus.

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Citations to Recover or Discover Property

The representative (administrator or executor) of an estate can sue in any court for property taken from the decedent. A summary procedure is also provided for in a supplemental proceeding before the same probate court handling the estate.

The representative can file a petition for a citation either to discover property or to recover it.

The court orders the citation to issue commanding the person to  whom it is directed to appear and respond and the citation is served on the respondent by the Sheriff just like any  other lawsuit. Any interested party can also bring a citation against the representative.

Illinois Abatement

ABATEMENT

When an estate is not large enough to pay all the expenses, taxes and gifts in a will then there are rules to determine which payments will decrease or "abate". Generally residuary bequests abate first. These are gifts of "everything else" or "the balance of my estate". Then general legacies abate pro rata and then specific legacies abate pro rata.

Pet Trust Act

Trusts for pets are now enforceable in Illinois. Before recent legislation providing for this such trusts were problematic in that the beneficiary (the pet) could not sue to enforce the trust and no one else had a right to after the grantor's death.  Visit Chicago Wills, Estates &Trusts for more information.

Uniform Transfers to Minors Act

Minors do not have legal capacity to contract or deal with assets. They have no capacity to sue or be sued. For this reason minors do not usually hold title to property in their own name. Instead title to a minor's assets is usually held by a guardian or property is given to a trustee to hold for the benefit of the minor. Guardianships and trusts are expensive and for that reason, among others, are not suitable for smaller amounts of money or other property. For this reason Illinois and most other states have statutes similar to the Uniform Transfer To Minors Act.

In Illinois the Act allows a transfer to be made to a custodian for the benefit of the minor. The Act specifies the consequences of the transfer and the rights and duties of the parties. There are no documentation requirements beyond the form of the transfer itself. There are particular requirements for different kinds of property, but generally the document of transfer must state that the transfer is being made to a named custodian to hold for a named minor and the document must state the transfer is being made under the Illinois Uniform Transfers to Minors Act.

The transfer can be made to any adult or a trust company except in certain cases such as a transfer from a trust or estate where the adult must be a member of the minor's family. The transferor can be the custodian.

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About Chicago Estate Planning Lawyer Don Thompson

Chicago Estate Planning attorney Donald M. Thompson is licensed to practice law by the Supreme Court of Illinois, U. S. District Court in Chicago, U. S. Circuit Court of Appeals for the 7th Circuit, and the U.S. Tax Court. He is a member of the Federal Trial Bar. He is a 1966 graduate of the University of Chicago Law School where he was in the top quarter of his class and received the Mandel Legal Aid Award. He was assistant professor of law at I.I.T.-Chicago-Kent College of Law from 1966 to 1970 teaching tax and property subjects.

He is a member of the Chicago, Illinois State, American and 7th Federal Circuit bar associations. He serves on the Chicago Bar Association's tax, trust probate, securities law and corporation law committees and is past chairman of the corporation law and legal education committees.

He is a member of the Chicago Bar Association's estate planning, probate, corporation and tax referral panels. He is an Arbitrator for the National Association of Securities Dealers and the Circuit Court of Cook County.

Crummey Trust/Crummey Powers

There is a yearly exclusion from gift tax of $11,000 per year per donee in 2003 (the amount rises periodically). This applies only to gifts of present interests. A gift in trust is not considered a present interest. For instance there is a gift in trust if you give money to a trustee to hold and pay the income to grandchildren each year until the youngest reaches 25 when all the rest of the trust assets are distributed to them. Since the grandchildren cannot get the trust assets presently, this is not considered a present gift.

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Charitable Deduction

There is allowed as a deduction from the taxable estate any gift to a qualified group organized and operated exclusively for religious, charitable, scientific, literary or educational purposes. A gift to a trustee for the benefit of any such organization also generates the deduction. A gift of a remainder interest also generates the deduction.

A gift of a remainder interest also qualifies. For instance if you will assets to a trustee on your death to be held for the benefit of your spouse while he or she is alive and then to be paid to a charity. The value of that interest at the time of your death is deductible. Actuarial tables provided by IRS are used to make the valuation.

Joint Trusts

When spouses (or anyone else) together create one trust it is called a joint trust. These trusts are common in community property states, but are not widely used in Illinois because of the adverse estate and gift tax consequences that may result. Recently the tax rules have been eased in some private letter rulings and there are also many non-taxable estates so the use of joint trusts is increasing. There are still many technical pitfalls and separate trusts are usually advisable.

These should not be confused with joint wills. When both spouses share one will it is called a joint will. Joint wills, for a variety of reasons, should not be used.

Organ and Tissue Donation

If you wish to give parts of your body to others after your death, you will is not a good place to do it. Your will won't ordinarily be procured and read until well after organ transplants must be made.

However, gifts of organs can be made by will and the gift is effective whether or not the will is admitted to probate and even if the will is later successfully challenged, to the extent the gift was actually carried out.

Organ gifts can be made as part of the issuance of drivers licenses. They can also be made by separate document executed before 2 witnesses like a will. Read more at Chicago Estate Planning Lawyers.

What Happens Without an Estate Plan

The state dictates who gets your property and who will be the administrator (manager) of your estate and who will be guardian of your children if your spouse has already died and who will be your guardian if you are disabled.

If you die without a will survived by a spouse and children, the spouse gets one-half and the children get the rest. There are no exceptions.

Guardianships are expensive and time consuming and if money or property is involved court approval is needed for everything.

All your property must be collected and sold unless all the beneficiaries agree to keep it. The family business or farm must be sold.

There is no provision for professional management of your estate.

There will be probate of your estate if it exceeds $50,000. This is court determination of who is entitled to your property and supervision of its collection and distribution.

Taxes may be a lot higher. Read More at Wills and Trusts Chicago.

What Is Estate Planning

Estate Planning starts with an analysis of ---

• Your assets
• Your liabilities
• Your present and future needs and desires
• The present and future needs and desires of your family and relatives
• Your and their future prospects.

Estate planning consists of planning and structuring your assets to meet those needs and desires. Some of the considerations are --

• Determining who is to get your assets
• Naming the executor of your will
• Naming the trustee of any trusts you may create
• Naming the guardian of your children, if both you and your spouse die
• Naming someone who will care for you and your assets if you are disabled.

Wealth building

• Providing for your children's education
• Providing insurance coverage for illness, disability or death
• Providing for investment and management of your assets after your death
• Tax planning to reduce income and estate taxes
• Avoiding probate.

Contact the Law Offices of Donald Thompson for further information on Illinois Estate Planning Law.