August Is National Make-a-Will Month: 7 Estate Planning Documents Illinois Families Should Review is a timely reminder that estate planning is about more than deciding who receives your property after you die. A good estate plan can also address who may handle your finances if you become incapacitated, who can make health care decisions for you, and how a family business or farm should continue.
Many people put off estate planning because they feel too young or assume they can deal with it later. But marriage, divorce, children, buying property, starting a business, or losing a loved one can quickly make an outdated plan a problem. August’s Make-a-Will Month observance offers a natural opportunity to finally review what you have—or create a plan if you do not have one yet.
1. Last Will and Testament
A will can state who should receive probate assets, nominate an executor or personal representative, and nominate a guardian for minor children, subject to court approval.
Illinois has specific execution requirements. Generally, a will must be in writing, signed by the person making it or by someone acting at that person’s direction and in their presence, and witnessed by at least two credible witnesses.
If you die without a valid will, Illinois intestacy law determines who receives property that passes through your probate estate. Those rules may not match your wishes, especially in blended families, second marriages, or families that own farms and businesses.
2. Revocable Living Trust
A revocable living trust can be useful, although not everyone needs one. Assets placed in the trust can be managed under its terms during your lifetime and distributed according to the trust after your death.
Trusts may be helpful for people with real estate in multiple states, complex family circumstances, privacy concerns, or a need for more detailed management of property. A trust must be properly drafted and funded to work as intended.
3. Illinois Power of Attorney for Property
An Illinois power of attorney for property allows you to appoint an agent to handle financial and property matters within the authority granted by the document.
That authority may include banking, real estate, business affairs, taxes, insurance, investments, or other financial responsibilities. Having a valid power of attorney can be especially important after an unexpected illness or injury.
4. Illinois Power of Attorney for Health Care
A health care power of attorney lets you designate someone to make health care decisions for you when authorized to do so.
This is different from simply telling a spouse, child, or friend what you would want. A properly prepared document can provide clarity during a medical crisis.
Adults should periodically review whom they have named, particularly after a marriage, divorce, death, or other major relationship change.
5. Living Will
A living will serves a different purpose from a health care power of attorney. Under the Illinois Living Will Act, a person may make a declaration concerning death-delaying procedures in certain circumstances involving a terminal condition.
Because these documents address different issues, families should not assume that having one automatically makes the other unnecessary. An estate planning attorney can help determine how advance directives should work together based on your wishes.
6. Beneficiary Designations and Transfer-on-Death Documents
Some assets may pass according to beneficiary or transfer-on-death instructions rather than under a will. Life insurance, retirement accounts, and certain financial accounts may allow you to name beneficiaries.
Illinois also permits an owner to use a properly executed and recorded transfer on death instrument to transfer real property to one or more beneficiaries at death when the applicable legal requirements are satisfied.
This makes coordination important. An outdated beneficiary designation can create problems even when your will has recently been updated. Beneficiary and transfer-on-death arrangements should therefore be reviewed as part of the overall estate plan rather than treated as unrelated paperwork.
7. Farm and Business Succession Documents
For farmers and business owners, a will may be only one part of the succession plan.
Operating agreements, partnership agreements, buy-sell agreements, leases, ownership records, and other business documents should be reviewed alongside estate-planning documents.
Who owns the business? Who can operate it after incapacity? What happens to an ownership interest after death?
For family farms, these questions can become particularly complicated when farmland ownership, operating entities, equipment, leases, and family expectations overlap. Coordinating the estate plan with the farm or business succession plan can help prevent confusion when the next generation eventually takes over.
When Should You Review Your Estate Plan?
You do not need to rewrite your estate plan every August, but you should revisit it periodically and after significant changes.
Common triggers include marriage or divorce, the birth or adoption of a child, buying or selling real estate, receiving an inheritance, starting or selling a business, moving to another state, or the death or incapacity of someone named in your documents.
Even without a major event, an older plan may contain beneficiaries, fiduciaries, assets, or assumptions that no longer fit your life.
Frequently Asked Questions About Illinois Estate Planning
Do I need an estate plan if I do not have a lot of money?
Estate planning is not only for wealthy families. Powers of attorney, health care decisions, guardianship concerns, beneficiary designations, and instructions for property can matter regardless of the size of an estate.
What happens if I die without a will in Illinois?
Property subject to intestate succession is distributed according to Illinois law rather than according to instructions you might otherwise have placed in a will.
For example, if a person dies leaving both a spouse and descendants, Illinois law generally provides one-half of the intestate estate to the surviving spouse and one-half to the descendants.
Does a will avoid probate in Illinois?
Not necessarily. A will provides instructions for property that passes through the probate estate, but having a will does not itself eliminate probate.
Trusts, beneficiary designations, joint ownership arrangements, and transfer-on-death planning may affect which assets pass through probate.
Make August the Month You Review Your Estate Plan
National Make-a-Will Month is a useful reminder that estate planning is much easier to address before a crisis. Whether you need your first will, have documents that have not been reviewed in years, or own a family farm or business, August is a good time to get organized.
Rincker Law, PLLC assists Illinois individuals, families, farmers, and business owners with estate planning and succession matters. To discuss creating or reviewing an estate plan, contact Rincker Law, PLLC at (217) 774-1373.
Legal Disclaimer: This article is for general informational purposes only and is not legal advice. Estate-planning laws and individual circumstances vary. Reading this article does not create an attorney-client relationship.
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