Cowles: Sample Plan Scenarios

Below are descriptions of two estate planning scenarios, followed by links to a completed checklist and estate plan for each scenario.

These plans illustrate what could be drafted during an initial appointment using the Cowles Checklist to gather all information and select appropriate phrases and documents. Following the initial appointment, the plan could be generated in its entirety within thirty minutes with Cowles Trust Plus drafting software.

Sample A

Seymour (Sy) Cramer, who has three children, is in his second marriage. After being widowed, he remarried eight years ago to his current spouse, Anita. Anita does not have significant net worth of her own, but will be provided for sufficiently through a family trust left by her parents, of which she is an income beneficiary. Sy and Anita entered into a prenuptial agreement, which classifies each spouse's assets as their own separate property. Sy is fifty-seven years old and his children are from his previous marriage. They are:

• Catherine Adams, age 14
• Christopher Cramer, age 15
• Curtis Cramer, age 17

There are no health issues with the children. Mr. Cramer's assets total approximately $3 million. He wants to preserve assets for his children and provide for guardianship for the children and management of their inheritances should they inherit at a young age. He would like substantial values distributed to the children or available for their benefit upon his death. However, he also wants to make full use of estate tax exclusions available to both spouses.

Sy realizes that with this plan, if Anita predeceases him, federal estate tax liability may result, but he is not interested in lifetime gifting - to a QTIP or elsewhere. In addition to this plan, an irrevocable life insurance trust was drafted to provide funding for potential estate tax.

View the Cramer Checklist (PDF) »
View the Cramer Plan (PDF) »

Sample B

Joseph and Alice Jackson have been married for 22 years and have four children, ages 19, 17, 15, and 13. Peter, age 19, has special needs and is eligible for various entitlement benefits. Joe and Alice have an estate valued at approximately $400,000, made up of real estate, securities, and a small business. The Jacksons want to retain control of all assets throughout their lifetimes. When neither of them survives, they want assets to be distributed to their children, with Peter's share protected so that eligibility for public benefits is not jeopardized, and with trusts for other children if they have not yet reached age 30. In the future, Peter's grandparents may want to contribute funds to supplement Peter's public benefits.

The Jacksons' estate plan uses a revocable trust, with Peter's share pouring into an irrevocable third party special needs trust (SNT). Shares for other children begin in a common trust, to ensure sufficient funds to raise all children. The common trust splits into separate trusts for each child when the youngest child reaches the age of majority.

Cowles' software is intelligent enough to incorporate language necessary to provide appropriately for contingent beneficiaries. For example, if an SNT is used, a prompt will ask if the SNT should be included as a contingent beneficiary if another beneficiary (or their issue) does not survive.

The SNT could have been included as part of a revocable trust or will, or the estate plan may pour Peter's share from a trust or will into a separate SNT. This is the approach we've taken in this sample plan. Using the separate SNT makes it easier for others to contribute to the SNT and creates a separate document for inspection by agencies assessing benefit eligibility without disclosing the revocable trust or will provisions.

All supporting documents (pourover will, health care directives, HIPAA release, community property agreements, if applicable, financial powers of attorney, etc.), documents to fund the trust (state specific deeds, assignments, etc.), and correspondence to third parties to fund the trust and to educate grantors and trustees are created by software - with consistency in content assured by the Cowles' system.

View the Jackson Checklist (PDF) »
View the Jackson Plan (PDF) »