Medical professionals in California encounter life-or-death situations every day. However, few take the time to consider their own deaths. But like everyone, it’s important to plan their estates. While they may share the same estate planning issues as the rest of the population, they also face legal challenges that are unique to the medical profession. This article addresses those issues and offers useful tips that may be beneficial.
Establish an asset protection trust
In addition to a revocable trust, medical professionals need to establish an asset protection trust. This is an irrevocable trust that is legally protected, making it difficult to take the assets in a lawsuit. Because physicians are often the target of malpractice claims this type of trust is invaluable.
Make decisions about your business
Estate planning for physicians is especially important because so many of them own their own businesses or are in partnership with others. If they are in a solo practice, they need to consider what would happen if they died or became incapacitated. They need to choose a doctor to take over their practice or to sell it for them. If they are part of a group practice, they need to have estate plans that indicate what will happen to their part of the business upon their death. Perhaps another partner will buy their portion from their family. They also need to decide who will inform their patients of the changes.
Monitor and update your plans periodically
Normally, physicians’ incomes and assets increase over time, as they pay off hefty student loans, and become more established. It is important to keep estate documents current to reflect any changes that occur as time goes by.
Estate planning is important, no matter what your profession. If you begin with a solid plan, you have a foundation to build upon.