| Administrator | A person appointed by the Probate Court to manage and distribute an estate when there is no Will. If there is a Will, the person so appointed is called the executor/ executrix or personal representative. |
| Affidavit | A sworn, written statement executed under oath in front of a witness. |
| Assets | Property or possessions held by a person regarded as having value and available to meet debts, commitments or legacies. |
| Attorney-in-Fact | The individual named in a Durable Power of Attorney to manage legal and financial matters. |
| Beneficiary | An individual receiving benefits from any source such as life insurance, an annuity, IRA or other retirement plan; and those receiving benefits from a Trust or a Will. |
Charitable | A Trust used to make large donations of assets to a charity. In a Charitable Remainder Trust, the donor reserves the right to use the property and/or money during his or her lifetime or for some other specified period of time. When the agreed period ends, the property and/or money is distributed to the charity. |
| Codicil | A document which makes changes or additions to an existing Will. |
| Conservator | A person appointed by the Probate Court, to be legally responsible for the management of property and/ or money belonging to an incapacitated person or a minor. |
| Decedent | The person who has died. |
| Debt | Refers to money owed by an individual or party. |
| Durable Power of Attorney | A document naming an agent to manage financial and legal matters for an individual. This grant of authority, although revocable, stays in effect as long as the individual is alive regardless of mental capabilities. However, it can be limited to only become effective during disability, illness or incapacity, i.e. Springing Power of Attorney. The determination of disability, illness or incapacity is made by the individual’s physician. |
| Estate | The aggregate of all assets and debts held (owned) by an individual during his or her lifetime or at the time of his or her death. |
| Estate Tax | A tax imposed on all assets owned or under the control of an individual at the time of his or her death. These taxes are paid from assets prior to distribution to beneficiaries. As of January 1, 2015, the Federal Estate Tax exemption quivalent is $5,430,000.00 and indexed every year for inflation. |
| Estate Plan | Planning that takes place to ensure that final assets and healthcare wishes are honored, and that loved ones are provided for upon one’s death. |
| Executor/ Executrix | A person named to carry out directives in a Will, and appointed by the probate court to manage and distribute the estate in accordance with the Will. |
| Fiduciary | A person with the legal duty to act primarily for another’s benefit. A fiduciary must abide by their fiduciary duties, examples include a Trustee, Executor/Executrix, Administrator, Personal Representative, Attorney-in-fact. |
| Fiduciary Duty | The duty of a Fiduciary is to act in a position of trust, good faith, candor and responsibility, on behalf of another. This duty is one of the best defined responsibilities under the law and is very strictly enforced by the courts. |
| Gift Tax | A Federal tax imposed on the donor of gifts in excess of an amount determined by the IRS. For 2015, the IRS has established the annual gift tax exclusion amount to be $14,000 per person. Presently, the lifetime Gift Tax Exemption amount matches the Estate Tax Exemption amount. |
| Grantor | An individual who establishes a Trust. |
| Guardian | A person appointed by the Probate Court or selected by a parent in a Will or Trust to serve for the protection of minors and incapacitated persons lacking the ability to meet essential requirements for physical health, safety, or self-care reasons. |
| Health Care Agent | The individual named in a Health Care Directive to communicate wishes concerning an individual’s healthcare matters upon incapacity. |
| Health Care Directive | A document naming someone to be the spokesperson to communicate an individual’s wishes concerning healthcare matters upon incapacity. |
| Intestate | Means to die without a Will in which case the estate passes to heirs at law according to individual state law. |
| Irrevocable Trust | A Trust that cannot be changed, canceled, or revoked once it is created such as an Insurance Trust. |
| Joint Ownership | When two or more people own the same piece of property. Such ownership can be as Joint Tenants, Tenants in Common, Tenants by Entirety or other legally defined relationships. |
| Joint Tenancy | When two or more people take title to the same property and collectively own 100%. |
| Legacy | Something of value that is transmitted from one generation to another. |
| Letters of Administration | A formal court order (document) issued by a Probate Judge giving the Administrator of an intestate estate authority to conduct business, contract, sell estate property, pay bills, distribute estate property, and otherwise act on behalf of an estate. |
| Letters Testamentary | A formal court order (document) issued by a Probate Judge giving the Executor of a Will authority to conduct business, contract, sell estate property, pay bills, distribute estate property, and otherwise act on behalf of an estate. |
| Life Estate | The right to have all of the benefits of a property during one’s lifetime without owning the property. Upon death, the property is not included in the person’s estate. |
| Marital Deduction | For Federal Estate Tax purposes, a 100% deduction for all assets passing from one individual to his or her surviving spouse. |
| Per Capita | Dividing an estate into equal shares to all individuals, regardless of generation. |
| Per Stirpes | Dividing an estate by generation of beneficiaries. This is the most common way of distributing an estate such that if one child has died, his or her children share equally in that share. |
| Personal Property | Tangible property items, including vehicles, furniture, jewelry, and animals are examples of personal property. Does not include real estate, bank accounts or securities. |
| POD Account | Payable-on-Death is an account that is designed to avoid probate. It is a contract between the bank/financial institution and the account holder guaranteeing that, upon the account holder’s death, the institution will pay the balance of the account to whomever is designated to receive the account. |
| Pour-Over Will | A document that provides for probate assets to pass or pour-over into a Trust to be distributed under its terms. A Pour-Over Will is often drafted in conjunction with a Revocable Living Trust to be sure all assets are included in the Trust upon the grantor’s death. |
| Probate | The legal process of transferring title to assets at death, either pursuant to the directions of a Will or through the intestacy laws of the State. |
| QTIP Trust | A Qualified Terminable Interest Trust (Q-Tip) is a type of Trust that provides an unlimited marital deduction for qualified property put into a Trust, which trust must be for the sole benefit of the surviving spouse. |
| Quitclaim Deed | A document (a deed) that transfers a person’s interest in a piece of real estate, without the warranties or guarantees that are made in a warranty deed. |
| Revocable Living Trust | A type of Revocable Trust used in Estate Planning to avoid Probate to better deal with situations of incompetency, and to allow smooth management of assets after the death of a Grantor. Revocable Living Trusts are established during the life of the grantor, who retains the right to the income and principal and the right to amend or revoke the Trust. When the grantor dies, the Trust becomes irrevocable and acts as a substitute for a traditional Will. |
| Special Needs Trust | A Trust which provides for the administration of assets for a disabled individual. The funds held in such Trusts are not counted as assets for the disabled individual as it pertains to eligibility for public benefits programs. |
| Tax | A financial charge or levy imposed upon a taxpayer by a governing authority. |
| Tenants by the Entirety | A way of owning property which, for all practical purposes, is the same as Joint Tenancy. Tenancies by the Entirety are creations of state law and are used only between husbands and wives, whereas Joint Tenancies can be used by anyone wanting to own property jointly, not just husbands and wives. |
| Tenants in Common | A way of owning property in which two or more owners all share ownership of the property. The owners can own various percentages of the whole property, unlike Joint Tenants which each own an equal share. When one owner dies, his or her share does not automatically go to the other owner(s), because Tenancies in Common do not have a survivorship provision like Joint Tenancies. |
| Testamentary Trust | A Trust established under the terms of your Will. |
| Testator or Testatrix | The individual who makes a Will. |
| Trust | A separate legal entity created by the signing of an agreement or declaration. It contains the terms under which assets in the Trust are held, administered and distributed. |
| Trustee | A person or institution that manages a Trust. |
| Will | A legal document stating the intentions of a deceased person concerning the distribution of his or her property and management of his or her affairs following death. State law dictates the legality of a Will. |
| Witness | A person testifying what someone else said or wrote. |