Estate Planning

Common questions

Do I need a trust, or is a will enough?

A will is sufficient for most people. An adult with grown children, or none, who intends every asset to pass immediately to heirs and has kept beneficiary designations up to date is well served by a will alone. Colorado even recognizes holographic wills, a will written almost entirely in the testator’s own hand. C.R.S. § 15-11-502(2). There are four situations in which a trust is worth the cost. Minor beneficiaries. An outright devise to a minor cannot simply be handed to the child: absent a trust or a custodianship under the Colorado Uniform Transfers to Minors Act, C.R.S. § 11-50-101 et seq., the distribution may require a court-supervised conservatorship, C.R.S. § 15-14-401 et seq., which is expensive to establish and continuing in its supervision. Colorado’s general statutes, moreover, treat minority as extending to twenty-one for many purposes, C.R.S. § 2-4-401(6), and a custodianship may run to that age. Anyone leaving assets to a beneficiary who might be under twenty-one should consider a trust. Control over timing. A will distributes property at once. A trust can distribute it on terms: at a stated age, upon the occurrence of an event, in installments, or at the discretion of a trustee. Where the instrument also restrains a beneficiary from assigning their interest and places it beyond the reach of their creditors, it is a spendthrift trust. C.R.S. § 15-5-502. Estate tax. A will alone does not address tax planning. If your estate is large enough to face federal estate tax, a trust becomes an important planning tool. Colorado itself imposes no estate or inheritance tax; the analysis is federal. Probate avoidance. A will and trust together generally cost less than administering an estate without them. The simplest probate begins around $3,000 and rises from there: the petition, filing fees, publication fees. Notice of a death must run in a newspaper even when a will exists. C.R.S. § 15-12-801(1). Creditor claims must be answered, from old credit cards to invoices from assisted living. Distributions must be carefully calculated and the probate case closed. A trust can move assets without a case being opened at all. A trust does not guarantee that probate is avoided. A single oversight, such as failing to name the trust as beneficiary of a life insurance policy, can require administration regardless. This is worth confirming before you rely on it.

What does an estate plan cost?

Our estate planning packages are billed at a flat rate, published above. Tax planning trusts, special needs trusts, and other complex instruments are billed hourly.

What happens if I die without a will in Colorado?

It is often said that the state decides who receives your property. That is not quite what happens. Colorado sets a statutory order of intestate succession, C.R.S. §§ 15-11-102 and 15-11-103, and it is more particular than most people expect. A surviving spouse does not automatically take everything. That result follows only where the decedent leaves no descendants and no surviving parent, or where every surviving descendant is a descendant of both spouses and the surviving spouse has no other surviving descendants. Introduce a child from an earlier relationship, on either side, and the spouse takes a fixed sum plus a fraction of the balance, with the remainder passing to descendants. Where there are no descendants but a parent survives, that parent shares in the estate as well. The fixed sums are adjusted for inflation each year. C.R.S. § 15-10-112. Where there is no spouse to receive the estate, the estate descends in a set order: to descendants first, then to parents, then to the descendants of parents, then to grandparents and their descendants. In such situations, inheritance is rarely the source of the dispute. The difficulty is that the court must appoint one person to make every decision. Sell the family house, or keep it? Sell the jewelry, divide it evenly, or give it to the one granddaughter? A single personal representative decides, and siblings contest who that will be. These proceedings can be straightforward. They can also become protracted and expensive, and the outcome may bear little resemblance to what the decedent would have chosen. Given how little a will costs to prepare (a holographic will costs nothing), no one should die without one.

How often should I update my estate plan?

An estate plan should be reviewed every time you experience significant life changes: a death in the family, a marriage, a divorce, a birth, or a new beneficiary who does not appear in the existing documents. In the absence of such events, a brief review every five years is recommended. Review is not revision. Most plans do not need rewriting on a five-year cycle, but they do warrant the conversation. The conversation about whether an update is needed is complimentary to our clients, whenever we prepared the plan.

I own an LLC. Does it pass through my will?

Not necessarily. An LLC’s operating agreement governs over the will. C.R.S. §§ 7-80-108, 7-80-702. Where the operating agreement is silent, the interest passes under the terms of the will. Where it is not, the agreement controls. We prepare beneficiary-form (TOD) registrations of entity interests under C.R.S. § 15-15-301 et seq. where that is the cleaner solution.

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