Following is an explanation of commonly used words and phrases related to estate planning and probate.

AB Trust – A trust designed to make sure the personal estate tax exemption of each spouse is used to the fullest extent possible, while allowing the surviving spouse to have use of the assets of the deceased spouse during the remainder of the surviving spouse’s lifetime.

Administrator – A court-appointed person who manages the estate of a deceased person who has died without a will.

Attorney-in-Fact – An individual designated in a power of attorney to act as the agent of the person who executed the document.

Basic Will – A will that distributes everything to your spouse,  if living, otherwise to your children when they reach the age of majority.

Beneficiary – A person who receives funds, property, or other benefits from a will, contract, or insurance policy.

Durable Power of Attorney for Health Care – A written document in which an individual designates another person to make health care and health-related decisions in the event that the individual becomes incapacitated.

Durable Power of Attorney for Property – A written document in which an individual designates another person to make his or her property and property-related decisions in the event that the individual becomes incapacitated and is unable to do so.

Estate – An individual’s property and assets — including real estate, bank accounts, life insurance policies, stocks, and personal property such as automobiles and jewelry.

Estate Tax – A tax that is imposed at a person’s death, on the transfers of some types of property from their estate to heirs and beneficiaries.

Executor/Executrix – A person named in a will who is authorized to manage the estate of the deceased person. The executor will collect the property, pay off any debts, and distribute property and assets according to the terms of the will.

Fiduciary – A person or institution that is legally responsible for the management, investment, and distribution of funds; i.e. the trustee identified in a trust.

Grantor – A person who transfers assets to another, usually into a trust.

Guardian – An individual with the legal authority to care for another, usually a minor child but could be an adult who is unable to take care of him/herself.

Incapacity – A person’s inability to act on his or her own behalf, i.e. the “sound mind” requirement for drafting a valid will. A court makes a finding of incapacity.

Inter vivos trust – A trust that is created during a person’s lifetime, which holds property for the benefit of another.

Intestate – A term used when a person dies without a will.

Joint Tenancy With Right of Survivorship – A title that is often placed on co-owned property. At the death of one owner, the other owner will be legally entitled to sole possession of the property, regardless of what provisions are made in a will. A husband and wife often use this form of ownership.

Living Trust – A revocable trust established during a grantor’s lifetime that is used for the placement of some or all of the grantor’s property. In a situation involving a married couple, a basic living trust does not effectively use the personal estate tax exemption of either spouse. Because of this deficiency of a basic living trust, an AB Trust (discussed above) is often recommended instead to married couples with substantial assets.

Living Will –  A binding legal document that sets forth a person’s wishes regarding the use of life-sustaining treatment in the event that he or she becomes terminally ill or permanently unconscious.

Marital Deduction –  A federal tax deduction that allows one spouse to pass his or her estate to the other spouse without having to pay estate or gift taxes.

No Will – A decedent dies without a valid will, so that his or her estate passes to heirs based on the Mississippi laws of descent and distribution of his or her state.

Pour-Over Will – A will that distributes everything to a trust.

Power of Appointment – A legal right given to a person in order to allow him or her to decide how to distribute a deceased person’s property. A “general” power of appointment places no restrictions on the named person, while a “limited” or “special” power of appointment places restrictions on who may receive distributions.

Power of Attorney – A written document that gives one person the legal authority to act on behalf of another person.  This can be specific to one transaction or it can be unlimited.

Probate – A process whereby a court reviews a will to make sure that it is authentic, and allows others to make legal challenges to the will. When a will is probated, it is the responsibility of the Court to be sure that all property of the decedent is distributed in the manner prescribed by the maker of the will.

QTIP Trust – A trust designed to permit a spouse to transfer assets to his/her trust while still maintaining control over the ultimate disposition of those assets at the spouse’s death. QTIP Trusts are particularly popular in situations where a person is married for a second time but has children from a first marriage for whom he/she wants to reserve assets.

State Death or Inheritance Taxes –  Taxes that may be imposed by the state where a deceased person lived, or where his or her property is located after death.

Tenancy by the Entireties – This real property tenancy is limited to property owned by a husband and wife.  A deed by the entireties insulates the property from the claims of the pre-decedent’s estate creditors. In fact, the property is not merely insulated. it is exempt, which means in essence that it is no part of the estate at all. So, for instance, a doctor who is sued for malpractice will not have to worry that his joint real property will be subject to a judgment against him if it is owned with his wife by the entireties.  A wife need not fret that her property owned by the entirety will be subject to her husband’s debts and vice versa. Death of one party or a divorce terminates the entirety.

Trust – A written document providing that property be held by one (the “trustee”) for the benefit of another (the “beneficiary”). A trust may be created during the grantor’s lifetime or after his or her death.

Trustee –  A person named in a trust document who will manage property owned by the trust, and distribute the trust income or property according to the terms of the trust document. A trustee may be an individual or a business.

Will – A document that directs how property shall be distributed upon a deceased persons death.