Estate Planning Terms and Definitions

Fiduciary
A person in whom one places great confidence in and upon whom one relies for his or her integrity, trust, and good faith. A fiduciary has the legal duty to act in the best interest and benefit of another and therefore is held to the very highest legal standards. A trustee is a fiduciary.

Tenancy-in-Common
A form of ownership of property in which two or more persons share ownership (may be equal or unequal shares). At the death of a tenant-in-common, his/her share in the property transfers to his/her heirs, rather than to the other surviving owner(s). Compare with Joint Tenancy.

Trust
A long recognized legal concept (first used in ancient Greece during the times of Socrates and Plato) in which some or all property of a Trust Creator is held on behalf of a beneficiary (which may include the trust creator) in the name of the Trustee.

Interlineation
Something written in-between; often a change to a typed document that is made by crossing out words and entering in replacement words. Never change an executed will or trust by interlineation.

Informed Consent
An authorization to proceed by a person who has been given and understands all of the relevant facts.

Inheritance Tax
A tax imposed by the state at the time of a person's death that is based upon the total value of the decedent's estate

Gross Estate
The value of an estate before the debts are paid. In California Probate statutory attorneys and personal representatives fees are usually calculated based on the gross value of the estate, so that the value of the home is calculated before deducting the amount due on the mortgage.

Devise
A gift made by a will or a trust. A devise is made to a beneficiary under the terms of the will or trust.

Trustee
A person or institution responsible for the management and distribution of property held in a Trust. The trustee has the authority to act according to the instructions provided in the trust agreement. See Fiduciary.

Living Trust
Sometimes called an Inter-Vivos Trust--A written legal document established during a person's lifetime into which he/she places property.