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Sample Transmittal Letter -- For Sending Drafts to Clients
Mr. and Mrs. [Husband's Name]
Dear Mr. and Mrs. [Client Last Name]:
Enclosed are drafts of the following documents for each of you:
1. A Will, which provides (among other things) for the creation of a "Bypass Trust" as a means to preserve the estate and gift tax credit of the first spouse to die. This credit, which is currently equivalent to $600,000 in assets, may allow the two of you to pass more of your combined marital wealth to your descendants or other estate beneficiary free of the estate tax. [Option 1: The Bypass Trust in each Will is funded by means of a disclaimer by the surviving spouse. This method of funding permits the surviving spouse to wait until the death of the first spouse to die to decide to what extent the Bypass Trust is to be funded. The surviving spouse could choose to disclaim nothing, meaning that the surviving spouse would receive the entire estate and nothing would be placed in the Bypass Trust. Or the surviving spouse could decide to disclaim up to $600,000 worth of property, causing the property so disclaimed to pass into the Bypass Trust. Thus, the estate tax savings under each Will is totally dependent upon the decision of the surviving spouse to disclaim or not to disclaim.][Option 2: The Bypass Trust in each Will is funded by means of a formula. This formula contains language which is intended to maximize the amount of property passing into the Bypass Trust without causing there to be any tax due on the death of the first spouse to die. Funding of the Bypass Trust pursuant to this formula is mandatory on the death of the first spouse -- the surviving spouse has no power to choose whether or not to fund the Bypass Trust.]
2. A Statutory Durable Power of Attorney, which gives the person you name broad power and authority to deal with your property.
3. A Durable Power of Attorney for Health Care (with Disclosure Statement), in which you give the person named in the power of attorney the authority to make health care decisions for your if you are incapacitated and unable to make the decisions yourself.
4. A Declaration of Guardian, in which you name the person you want to be the guardian of your person and estate should the need later arise.
5. A Directive to Physicians, often called a "living will," in which you indicate your wishes regarding medical treatment in the event of a terminable illness. In the Directive to Physicians, you name the person you want to make treatment decisions for you if you are unable to do so for yourself.
6. Instructions on how to coordinate your life insurance proceeds and retirement plan benefits with your estate plan. It is important for these proceeds and benefits to be coordinated with the estate plan so that all of the goals of the estate plan are realized. You will have to contact your insurance companies and plan custodians or trustees to determine how to change the beneficiary, since each company has slightly different requirements.
Keep in mind that the above descriptions of your documents are included in this letter for your convenience only. These descriptions are summaries only and are not intended to make it unnecessary for you to read the documents carefully. You must read the actual documents carefully and be sure that you actually understand them. If there is a conflict between the terms of the documents and the terms of this letter, the terms of the documents will control.
Please read the enclosed documents carefully to make sure that they are correct and to make sure that they properly reflect your wishes. Pay particular attention to birthdates, the spelling of family member names, etc. -- it is easy for me to make a mistake on these items. Please call me if you have any questions. Also, please call me to provide missing information, if any.
Please contact me with your questions, corrections or changes, and please contact me to set up a time to sign these documents.
I look forward to hearing from you.
Very truly yours,
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Copyright 1998 by Glenn M. Karisch Last Revised June 11, 1998