Michael J. Fazio, Jr., Esq.

Partnering with you in Creative Legal Solutions

Estate Planning

Estate Planning is for everyone.

Michael J. Fazio, Jr., provides proven solutions and helps clients understand the relevance of Estate Planning Documents. When drafting your estate planning documents, Mike uses successful strategies to express, without ambiguity, your wishes when you cannot communicate for yourself due to disability or incompetency. Estate planning documents include competency documents, wills and trusts.

Competency Documents

Competency Documents are important because without them, the alternative may be Conservatorship, Guardianship, and Family Court Hearing at your significant monetary expense and time. Competency documents include:

  • General Durable Power of Attorney (Financial)

    A General Durable Power of Attorney allows you to give authority to someone you trust to do anything from such routine tasks as opening mail and depositing checks to the bank, to dealing with investments and filing taxes, avoiding the need and cost for a judge appointed conservator to manage your financial affairs.

  • Durable Power of Attorney (Medical)

    A Durable Power of Attorney is a written instrument by which a person (“Principal”) appoints another person as agent for the Principal conferring the power to perform specific acts on behalf of the Principal, which person is called an “agent”. A Durable Power of Attorney allows the continuation of the power through the Principal’s disability or incompetency avoiding a court procedure.

  • Massachusetts Health Care Proxy

    Prior to incompetency, you designate a person you trust: a family member, or close friend, to make medical decisions for you when you lose ability to make decisions yourself. Michael J. Fazio is prepared to work with you to address your health and religious convictions. Without this document, a Probate Court judge may appoint a guardian ad litem to assist the judge in making the decision at your cost.

  • HIPAA Release

    You designate a trusted family member or friend who knows your wishes for purposes of accessing your medical records and other medical information to make medical determinations.


Wills

Wills allow you to dispose of your property at death to your loved ones, friends, significant others, whether outright or in a testamentary trust. Types of wills include:

  • Simple Will

    Disposes of your property at death to your loved ones, friends, significant others

  • “Complex” Will
    • When your assets exceed the Massachusetts estate tax exemption of $1,000,000
    • You wish to set up a trust for your children
    • You have the expectation of accumulating additional wealth/assets
    • You have considerable assets or extended family
    • To avoid probate and/or estate taxes
  • Without a Will

    The estate goes through the Probate Court and the State will determine how your property will be distributed to your children, spouse, significant others, loved ones, and who will care for your minor children. This is known as intestacy. If no descendants remain, the estate escheats assets to the Commonwealth. However, if you are a veteran, then “under certain circumstances, The Soldiers’ Home in the Commonwealth or the Soldiers’ Home in Holyoke or the Commonwealth are the heirs.” The probate process runs from 9 months to 2 years or more.


Trusts

Trusts allow you to plan and manage your property and resources during life and upon and after your death to address the needs of your beneficiaries (loved ones, significant others, friends, etc.) resulting in significant tax savings.

  • Revocable Trust

    Complex Will pours over into Revocable Trust consisting of a Marital Deduction Trust and a Credit Shelter Trust

    • Marital Deduction Trust

      The deceased spouse leaves assets tax-free to this sub-trust, the surviving spouse having full access to the income, and “access as needed” to the principal for health, education, maintenance and support (HEMS)

    • Credit Shelter Trust (Family Trust)
      • Massachusetts provides $1 Million per person and $2 Million per couple to pass estate tax free
      • Current Federal credit shelter provides $5.6 Million per person and $11.2 Million per couple
      • Trust designed to allow a parent to transfer assets to the children
      • Your trustee will determine that the income considered with other resources available to the surviving spouse exceeds his/her reasonable need for comfort and support, the Trustee may pay the excess income to the descendants as provided
Without a Trust

Couple has $1,000,000 each, totaling $2,000,000. First to die leaves $1,000,000 outright to surviving spouse. The $1,000,000 passes tax free. When second spouse to die passes, the estate is worth $2,000,000 and entire estate is taxed for $99,600 in Mass. estate taxes.

A successful use of this plan in Massachusetts would be as follows:

In the scenario with a trust, the first to die leaves $1,000,000 in a trust for the use of the surviving spouse. When second spouse to die passes, the estate is worth $1,000,000 (first spouse’s $1,000,000 not included) and passes to the heirs tax free.


OTHER STRATEGIES

  • ILIT – Irrevocable Life Insurance Trust
    • “need more tax credit?”
    • Keeps life insurance policy proceeds from being subject to tax in the insured’s estate
    • Insurance premiums pay the way
    • Trustee owns the policy for the Beneficiaries of the Trustor
  • Annual Gift giving -- $15,000 gift tax exclusion per person per year
Privacy Concerns?
  • Trustee Certificate – Short Form – provides some privacy
    Requires recording at the Registry of Deeds
  • Nominee Trust – Shelter for those who wish more privacy