FAQs

If you die without a will, you will have no say over who inherits your estate, or who serves as personal representative and/or guardian of any minor children. Your estate will be handled and distributed in accordance with your state’s “intestacy” law – which or may not reflect your actual wishes. Intestacy can often lead to court battles among heirs. For high net worth individuals, dying intestate can be a bad outcome from a tax savings perspective.

Probate is the legal process of administering an individual’s estate after death. Generally speaking this means submitting the will along with a petition to the Probate Court for approval, getting a personal representative appointed, ensuring the decedent’s property is properly safeguarded and inventoried, paying off the decedent’s debts and final taxes, preparing an estate accounting and providing it to the beneficiaries, and distributing the decedent’s property in accordance with the terms of the will (or if no will, then pursuant to state law).

In Maine, the probate process is “informal” in that there is minimal court involvement – unless there is a controversy or specific issue which requires the judge to intervene. This means that the probate process for the vast majority of Maine estates is relatively straightforward and inexpensive. Typically, there is no court hearing involved. The Probate Court charges a filing fee based on the size of the estate, and the personal representative may need to hire a lawyer to assist with the process – so there is some expense involved. Many folks – including marketing-savvy lawyers selling packaged binder trusts – tout “probate avoidance” as a good reason to create a living trust in your estate plan. The reality is that the costs and added complexity of setting up a trust and administering are not worth it if you’re setting it up simply to avoid probate in Maine.  Probate avoidance is a worthy goal in many other states however. Additionally there are many other reasons a trust could be warranted. It really depends on each client’s particular circumstances.

A will is a legal document which controls the disposition of property you own in your sole name upon your death. It is the simplest legal device for passing your assets on to your beneficiaries. Trusts are a separate legal tool for managing and disposing of property both during life and upon death. There are many different reasons to create a trust. Our attorneys can help you evaluate whether a trust is an appropriate tool for your circumstances. Some examples of trusts that we create in our offices include family succession trusts, nominee trusts, asset protection trusts, special needs trusts and irrevocable life insurance trusts. There are many circumstances where a trust may be advisable. For example, if you own real estate in another state or country, transferring the property into a trust may be advisable in order to avoid probate in the foreign jurisdiction. Trusts can be an effective tool for assuring privacy with respect to your estate plan or avoiding the notice requirements of probate.  Finally, trusts can be a useful tool for protecting assets in the context of long-term care planning.  Our focus and priority is always to keep affairs simple and understandable for clients.

An advance health-care directive consists of several parts and typically consists of a combination medical power of attorney and living will. You have the option of appointing an agent to make medical decisions on your behalf, and you can choose when you’d like that power to take effect – either right away, or if/when you become incapacitated. The amount of power you grant your agent to make these decisions is entirely up to you. You also have the option of giving your agent special instructions regarding end-of-life care – for example if you are terminally ill or in the late state of Alzheimer’s disease. The form this office utilizes is recommended by the Maine Hospital Association and contains several other parts including instructions relating to funeral/burial and organ donation.

An advance health-care directive is important because it allows you to select a decision maker and make your wishes known in advance of the end of your life and before lose the ability to do so on your own. It can provide you and your family with a sense of comfort and ease knowing that your wishes will be carried out in the manner you intended. If you become incapacitated and do not have a medical power of attorney in place, a guardian may need to be appointed to by the Probate Court to make those decisions. A guardianship proceeding can be costly and subject the family to a public court proceeding – all of which can be avoided with an advance health-care directive.

A financial power of attorney is an agency document in which you (the “principal”) designate an agent (also called an “attorney-in-fact” or “agent”) to handle your financial affairs on your behalf in the event of your disability or incapacity. The power of attorney can be limited or general in nature. It can be drafted to take effect immediately upon signing, or upon the occurrence of some future event (e.g. a determination of incapacity by a physician). Every state has different rules relating to the enforceability and validity of powers of attorney. In Maine, agents under powers of attorney are generally bound by fiduciary duties of loyalty and impartiality – similar to duties imposed on trustees. Powers of attorney grant truly sweeping authority to the agent and although laws have been passed to deter their abuse, malfeasance particularly here in Maine is all too common.

Powers of attorney are important to have in several contexts. If you are buying or selling real estate and are unable to attend the closing in person, it is useful to have a limited power of attorney giving another person the authority to sign all the documents required to close. In the estate planning context, powers of attorney allow your affairs to be handled if you become unable to do so. If you become incapacitated and do not have a valid power of attorney in place, a conservator may need to be appointed by the probate court to act on your behalf. Conservatorship proceedings can be expensive and time consuming, and they are public court proceedings. Furthermore, you may not have the ability to choose your conservator. Having a financial power of attorney can help you avoid these outcomes.  We regard powers of attorney as essential tools in estate and elder planning provided that you have a viable and appropriate agent to nominate.

(a) Estate / Gift taxes – For deaths in 2022, the federal estate and gift tax applies only to estates or accumulated gifts valued in excess of $12,060,000 whereas the Maine estate tax applies only to estates valued in excess of $6,010,000.  Safe to say the vast majority of Maine estates are not subject to estate tax.  Maine does not have a gift tax per se but will include the value of a gift in a decedent's taxable estate if the gift occurred within 12 months of date of death.

(b) Inheritance taxes – Maine residents do not pay inheritance taxes. Currently, only a handful of states impose an inheritance tax and the laws typically provide for exemptions for surviving spouse and children.

(c) Transfer taxes – If estate real estate is sold, the buyer and seller (i.e. the estate) typically split transfer taxes owned to Maine Revenue – unless the contract provides for a different allocation. The rate of tax is $2.20 for each $500 or fractional part of $500 of the value of the property being sold.

(d) Capital gain taxes – When a capital asset is sold, the difference between the “basis” in the property and the sale value is considered capital gain and subject to taxes. Generally speaking an asset owned by a decedent receives a “step up” in basis equal to the fair market value of the asset as of date of death. If a capital asset owned by a decedent is sold within a relatively short period of time after death, there are typically no capital gain taxes owed and in some cases, there may be a loss which can be passed down to the beneficiaries.

(e) Probate filing fees – Maine Probate Courts charge a fee for filing a petition for probate which is based upon the value of the estate. The higher the value of the estate, the higher the fee.

Maine, and the Midcoast area in particular, has a range of retirement communities, nursing homes, and assisted living facilities to suit your particular needs. We have put together a list of some of the facilities in Brunswick and the surrounding areas, along with relevant contact information. The list is called “Elder Resource Guide” and you can find a link to it on the Links page under the “Resources” tab.

Only for a limited period of time and under certain conditions.  Medicare Part A (Hospital Insurance) covers up to 100 days of skilled nursing care following a 3-day inpatient hospital stay for an injury or illness (aka “qualifying hospital stay”).  Medicare does not cover custodial care (e.g. bathing, dressing, toileting, etc.) if that’s the only care you need.  Coinsurance may be required after 20 days.  Here is a more information about skilled nursing facility care.