Administrator: an individual appointed by the court to oversee the distribution of assets and settlement of debts in the estate of a deceased person who did not leave a valid will.
Annual Gift Tax Exclusion: a provision in the United States tax code that allows individuals to gift a certain amount of money or property to another person each year without incurring federal gift tax. For current Gift tax figures, click here.
Beneficiary: someone designated to receive assets or benefits from a financial arrangement, such as a trust, will, or an insurance policy, upon the death of the account holder or the occurrence of a specified event.
Charitable Remainder Interest Trust: A trust whereby donors transfer property to a charitable Trust and retain an income stream from the property transferred. The donor receives a charitable contribution income tax deduction and avoids a capital gains tax on transferred property.
Codicil: a legal document that amends, adds to, or revokes specific provisions of an existing will without entirely rewriting it, providing a way to make changes to a will without creating an entirely new document.
Community Property: a legal marital property system, recognized in Louisiana, where assets acquired during the marriage are generally considered jointly owned by both spouses, with each typically entitled to an equal share in the absence of a specific agreement stating otherwise.
Curator: a court-appointed individual entrusted with managing the personal, financial, or health affairs of someone declared incapacitated through the interdiction process in Louisiana.
Decedent: a deceased person, particularly one whose affairs are being settled, including the distribution of their estate through probate or other legal processes.
Durable Power of Attorney: a legal document that grants someone (an agent or attorney-in-fact) the authority to make financial and legal decisions on behalf of the person creating the document (the principal), and it remains effective even if the principal becomes incapacitated.
Estate: the total property, assets, and liabilities left by an individual upon their death. It includes real estate, personal belongings, financial accounts, debts, and other possessions, and the process of managing and distributing these assets is known as estate administration or probate.
Executor: a person named in a will to manage the distribution of a deceased individual’s assets, settle debts, and fulfill the wishes outlined in the will.
Family Limited Partnership: a legal structure that allows family members to pool their assets into a partnership, typically for business or investment purposes, while retaining control through the general partner and enjoying certain estate planning benefits.
Federal Estate Tax: a tax imposed on the transfer of a deceased person’s estate, including money and property, to heirs or beneficiaries, with the tax rate and exemption amount determined by federal tax laws. For current Federal tax figures, click here.
Funding: the process of transferring assets, such as money, property, or investments, into a trust or other legal entity to ensure that the intended structure is properly established and functional according to the estate plan.
Generation Skipping Tax: a federal tax imposed on transfers of significant wealth, such as money or property, to individuals who are two or more generations younger than the donor, to prevent the avoidance of estate taxes across multiple generations.
Grantor: an individual who creates and funds a trust, transferring assets into the trust and defining its terms and conditions.
Heir: an individual who is legally entitled to inherit the assets, property, or estate of a deceased person, either by the terms of a will or through the laws of intestate succession if no valid will exists.
HIPAA Release: a legal document that allows an individual to authorize the disclosure of their protected health information to specified individuals or entities, ensuring compliance with privacy regulations in healthcare.
Immovable Asset: a piece of property or real estate that cannot be easily moved, such as land, buildings, or other permanent structures.
Incapacitated: a state in which an individual is unable to make informed decisions or manage their affairs due to physical or mental impairment, leading to a lack of legal capacity to handle personal, financial, or health matters.
Interdiction: a Louisiana legal process in which a court determines that an individual is incapacitated and appoints a curator to manage the personal, financial, or health affairs of that person, often due to mental or physical limitations.
Intestate: the condition where an individual dies without having a valid will, leading to the distribution of their assets according to the intestacy laws of the applicable jurisdiction, such as the laws outlined in the Louisiana Civil Code for residents of Louisiana.
Last Will & Testament: a legal document that expresses an individual’s wishes for asset distribution, executor appointment, and, if relevant, guardianship of minor children.
Legatee: an individual or entity named in a person’s will to receive specific assets or property upon the testator’s death.
Living Will: a legal document that outlines an individual’s preferences regarding medical treatment and end-of-life decisions in the event they become unable to communicate or make decisions for themselves.
Louisiana State Inheritance Tax: Louisiana does not impose a state inheritance tax. However, it’s important to note that tax laws can change, and it’s advisable to consult with a legal or tax professional for the most current information.
Movable Asset: tangible property that can be physically moved including vehicles, furniture, jewelry, bank accounts, and other possessions that are not attached to land or buildings.
Naked Ownership: denotes the legal ownership of a property without the right to use or enjoy it, often accompanied by the existence of a usufruct or other limitations on the full enjoyment of the property.
Notarial Will: a testamentary document that complies with specific legal formalities, including the involvement of a notary public and two witnesses, ensuring its validity and authenticity according to Louisiana’s legal requirements.
Olographic Will: a handwritten and entirely self-written testament, with its own set of specific requirements to be recognized in a Louisiana succession case.
Pour Over Will: a legal document that complements a living trust by directing any assets not already in the trust to be transferred into it upon the testator’s death, ensuring a unified estate plan.
Probate: the legal process through which a deceased person’s will is validated, their debts are settled, and their assets are distributed under the supervision of the court, ensuring the orderly transfer of property to heirs or beneficiaries.
Revocable Living Trust: a flexible legal arrangement allowing an individual (grantor) to place assets into a trust during their lifetime, retain control, and avoid probate by designating a successor trustee for asset management after their death.
Settlor: also known as a grantor or trustor, is the individual who creates a trust by transferring assets into it, defining the trust’s terms and conditions, and establishing the framework for the management and distribution of the trust property.
Special Needs Trust: a legal arrangement that allows individuals to provide financial support for a person with disabilities, without jeopardizing their eligibility for government assistance programs, by holding and managing assets for the beneficiary’s benefit.
Step-Up In Basis: the adjustment of the value of an appreciated asset to its current market value upon inheritance, minimizing capital gains tax for the inheritor when the asset is later sold.
Succession: the legal process in Louisiana of settling the estate of a deceased individual, including the distribution of assets and the payment of debts, whether the person died with or without a valid will.
Testate: the condition in which an individual dies having created a valid will.
Testator: an individual who makes a will, a legal document outlining their wishes for the distribution of their assets, and the appointment of an executor upon their death.
Trust: a legal arrangement where a trustee holds and manages assets for the benefit of one or more beneficiaries, based on the terms specified by the settlor (creator of the trust), providing a flexible tool for estate planning, asset protection, and the avoidance of probate.
Trustee: an individual or entity appointed to manage and administer a trust’s assets according to the terms specified by the settlor, ensuring that the trust’s objectives are fulfilled and benefiting the trust’s designated beneficiaries.
Tutor: a person appointed by the Louisiana court to serve as a legal representative and guardian for a minor child, responsible for making decisions regarding their well-being and managing their affairs.
Usufruct: a legal concept in Louisiana where an individual has the right to use and enjoy the property owned by another (the naked owner) without altering its substance, while the naked owner retains the ultimate ownership interest.