Dentists in California know the importance of estate planning, but that doesn’t make it any easier. Knowing where to start and how to build an effective estate plan can be challenging.
Estate plans include a will that outlines what should happen to your dental practice and other assets. But estate plans should also address things like power of attorney and advanced medical directives.
Power of attorney and advanced medical directives
A power of attorney is the person who will make legal and financial decisions on your behalf should you become incapacitated. This could be when you have to go under general anesthesia for surgery or if you lose your ability to make these decisions.
Sometimes a power of attorney will also serve as your healthcare proxy, but having a different person for the role is not uncommon. You might choose your brother or even a lawyer to be your power of attorney, but a spouse or adult child to serve as your healthcare proxy.
Medical directives outline your wishes for end-of-life care as well as any healthcare decisions that may happen in the future. It will be up to your healthcare proxy and power of attorney to carry out those decisions on your behalf.
Additional estate planning tools
There are additional estate planning tools that dentists can use to reduce estate taxes and help ease the transfer of assets. You could put certain assets – like your dental practice – into a trust so it won’t have to go through probate process. Assets put into a trust won’t be included in estate taxes either.
Estate planning when you own a dental practice can be intimidating. This doesn’t change the fact that estate planning is a crucial step in protecting your dental practice and easing the burden on your family.