Living Wills & Trusts in Oregon
A living trust plans for the distribution of your assets and income in Oregon, while a living will contains directions for your medical care in the event of your incapacitation. Both items allow you to leave final instructions for your affairs when you are no longer capable of making decisions or taking actions yourself.
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Function
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A living trust is an agreement you make that controls your assets and income while you are alive and after your death. The terms of your trust dictate who receives distributions from your trust and how much each person receives, and your trustee manages the fund. You may serve as the trustee in Oregon, but you must name a successor trustee to serve after your death or your trust will not be able to operate.
A living will, referred to as an advance directive in Oregon, is used to appoint a person--referred to as a "health care representative"--to make your medical decisions for you in the event you become incapacitated due to illness, injury or an accident.
Benefits
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A living trust allows you to place all of your assets and income into the fund before you die. Your loved ones may be able to avoid probate, the legal proceeding used in Oregon to settle an estate when a person dies with a will, according to the Oregon State Bar Association. Probate proceedings are a matter of public record in Oregon, so using a trust may keep the contents and matters of your estate private. Probate involves legal and court fees that your trust may not incur.
A living will ensures that your wishes concerning your medical care are honored. Your family members have a document containing your instructions for the difficult circumstances, and your representative has the authority to carry out your wishes if your family is struggling with making decisions.
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Considerations
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Oregon permits you to transfer assets to your trust after your death by including the transfer in a will. You can transfer a maximum of $50,000 of personal property and $150,000 in real estate you own to your trust through your will as of 2010. Your will may be subject to full probate proceedings if you fail to transfer all of your assets to your trust before your death and the value exceeds the limits allowed by law.
With a living will, your health care representative cannot overrule your medical care decisions unless you are incapacitated, even if your mental state is questionable. The representative can have you involuntarily committed to a hospital for up to 18 days if you engage in dangerous behavior due to dementia.
Misconceptions
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A living trust does not avoid taxes. Income, estate and gift taxes may still apply to your trust's contents and distributions. The amount of taxes your estate is required to pay depends on your estate's value and the federal and Oregon tax exemptions and rates.
In your living will, you may include directions barring life support, but Oregon requires certain circumstances be present to effect this provision. Your representative can refuse or withdraw life support for you if two physicians confirm one of the following: you are close to death and the support would only temporarily prolong your life; you will never regain consciousness; you have a progressive disease; or the support would only prolong your suffering and not help your condition.
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