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Estate Planning For Medical Professionals

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An estate plan is critical for ensuring that a person’s assets and finances are handled properly after death or incapacitation. People of all professions and occupations should have an estate plan. Estate planning for medical professionals involves some unique intricacies, such as ownership of a private medical practice and the possibility of outstanding medical malpractice lawsuits. Medical professionals who would like estate planning guidance can learn more about their options from the Washington estate planning lawyers at Baxter Legal Services: call today at 425-686-0574.

 

What Documents Should Be Included in a Medical Professional Estate Plan?

Medical professionals should address estate planning early in their careers. There is a common misconception that an estate plan should only be crafted later in life, however waiting until the golden years is not the strongest way to approach your asset protection and estate planning matters. It is vital to be prepared for how your finances and medical care will be handled in the event that you unexpectedly become incapacitated or pass away.

A medical professional estate plan should start with the main tenets that are included in most estate plans, which include:

 

  • Last Will and Testament (Will)- Legally designates beneficiaries and heirs, as well as who will gather assets, pay debts, and fulfill other wishes after the death of the estate owner.
  • Financial Power of Attorney - Allows the estate owner to name another person who can legally act on their behalf in financial matters.
  • Healthcare Directive - Designates an individual or individuals who can make healthcare decisions on the estate owner’s behalf if they become incapacitated.

 

Once these main estate planning cornerstones have been established, it is time to consider what additional provisions should be added for medical professionals. 

Group of doctors looking at a tablet

Private Medical Practices and Estate Planning

There are unique considerations that need to be considered when estate planning for medical professionals who own a private practice. The pandemic has driven many doctors away from private practice, however approximately 49% of American doctors still have their own practice, according to the American Medical Association. A private practice is a business, and it is important to include this business in an estate plan.

Medical professionals who own private practices should consider how to best pass the practice down to heirs or beneficiaries in their estate plan. In many cases, placing the medical practice in a trust can help avoid the probate process and ensure that beneficiaries inherit the private practice as soon as possible. This will allow the beneficiaries to sell the practice before it loses significant value. The experienced estate planning lawyers at Baxter Legal Services can help private practice doctors plan for what will happen to their practice after their incapacitation or death.

 

Accounting For Medical Malpractice Lawsuit Risks in Estate Planning

Doctors are exposed to higher liability risk than most other professions because of medical malpractice lawsuits. The American Medical Association estimates that about 34 percent of physicians have been sued and approximately 50% will face a lawsuit by age 55. A well-constructed estate plan should account for this liability risk and include asset protection measures.

Asset protection trust laws vary from state to state. While Washington is not one of the 17 states with asset protection trusts, there are other ways to protect assets when estate planning as a medical professional in Washington. Medical professionals who would like to incorporate asset protection into their estate plans should consult with an experienced estate planning lawyer to learn more about their available options.

 

Avoiding Probate in Washington State

The probate process in Washington can be time-consuming, expensive, and difficult to navigate. Fortunately, some estate planning options can help avoid probate. Avoiding this process can help prevent family members from future difficulties executing an estate plan after a loved one passes away. Washington residents have a few options for avoiding probate.

Set Up a Living Trust

A living trust can be set up in Washington to avoid probate for most assets, including bank accounts, real estate properties, vehicles, and more. The estate owner will name themselves as a trustee and transfer ownership of their assets to themselves during their lifetime. Additionally, a living trust will name someone as a successor trustee who will take control of these assets after the estate owner dies without needing to go through probate.

Joint Property Ownership

Many married couples share ownership of their properties. In such cases, the surviving spouse will automatically take sole ownership of any joint-owned properties when their spouse dies, without going to probate. The survivor will simply need to present documentation to show that they are now the sole owner of the properties.

Washington state allows property owners and co-owners to share assets through joint tenancy. Property owned under joint tenancy will automatically transfer to surviving owners when one of the owners dies. This can include real estate, bank accounts, vehicles, and other high-value properties.

Community Property Agreements

In Washington state, community property agreements are a common form of asset protection for married couples. These official legal documents dictate that when one spouse dies, all of the deceased spouse’s property automatically becomes community property and transfers to the surviving spouse without going through probate.

Designating a Bank Account as Payable-on-Death

Similar to a living trust but less complicated, a payable-on-death designation is an agreement made between a bank account holder and their financial institution. The account holder simply needs to notify the bank that a designated individual will inherit the account immediately after the account holder’s death.

 

Contact a Washington Estate Planning Lawyer for More Information on Estate Planning as a Medical Professional

Estate planning can be complicated for individuals of all occupations, but there are unique circumstances that must be accounted for when estate planning as a medical professional. Fully protecting your assets, ensuring all of your wishes are met, and making the process as simple as possible for surviving family members can often be made easier with legal guidance. Contact the Washington estate planning lawyers at Baxter Legal Services today for more information about estate planning for medical professionals: 425-686-0574.