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Estate planning terminology can feel unfamiliar. This glossary explains common terms used in California living trusts, wills, powers of attorney, advance health care directives, deeds, beneficiary designations, and related documents.

These definitions are general educational summaries. The meaning and legal effect of a term may vary depending on the document, the facts, and applicable law. LDA Document Services is not a law firm and cannot provide legal, tax, financial, or investment advice. Documents are prepared at the client's direction based on the information and decisions the client provides.

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A

Advance Health Care Directive

A California document in which a person may appoint a health care agent and state preferences concerning medical treatment, end-of-life care, organ donation, and related health care matters.

Agent

A person authorized to act for another person. An agent may be appointed under a financial power of attorney or an advance health care directive. An agent does not need to be an attorney.

Amendment

A document that changes one or more provisions of an existing trust while leaving the remainder of the trust in effect.

Annual Gift-Tax Exclusion

The amount a person may generally give to each recipient during a calendar year without using part of the person's lifetime federal gift and estate tax exclusion. The amount changes periodically, so current tax information should be obtained from the IRS or a qualified tax professional.

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B

Beneficiary

A person, organization, trust, or other recipient entitled to receive property, income, or another benefit under a trust, will, account, insurance policy, or beneficiary designation.

Beneficiary Designation

Instructions on an account, retirement plan, insurance policy, or other asset naming who will receive the asset after the owner's death. A beneficiary designation generally controls that asset independently of a will.

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C

Capacity

The legal ability to understand and make a particular decision or to sign a particular document. The required level of capacity may differ depending on the document and circumstances.

Certification of Trust

A shortened document confirming selected facts about a trust, such as the trust's name, date, trustees, and trustee powers, without disclosing the entire trust agreement.

Community Property

Under California law, property acquired by either spouse during marriage is generally presumed to be community property unless an exception applies. Property classification can be legally complex.

Contingent Beneficiary

A person or organization designated to receive property only if another named beneficiary does not receive it or if a stated condition occurs.

 

D

Decedent

A person who has died.

Deed

A written instrument used to transfer an ownership interest in real property.

Descendants

A person's children, grandchildren, and later generations. The exact meaning may depend on the governing document and applicable law.

Durable Power of Attorney for Finances

A written document authorizing an agent to handle specified financial or property matters. Durable means the authority may continue even if the person who signed the document later becomes incapacitated. The authority ends at death.

 

E

Estate

A general term for the property, rights, and obligations associated with a person. The term may refer broadly to everything a person owns or more narrowly to property administered after death.

Estate Planning

The process of arranging how personal, financial, property, and health care matters will be handled during life, during incapacity, and after death. An estate plan may include a living trust, will, power of attorney, advance health care directive, beneficiary designations, and deeds.

Estate and Gift Tax Exclusion

The cumulative amount an individual may generally transfer during life and at death before federal gift or estate tax becomes payable. The amount and rules may change, and tax advice should come from a qualified professional.

 

F

Fiduciary

A person or institution required to act in the interests of another person or for the purposes stated in a governing document. Trustees and agents under powers of attorney are examples of fiduciaries.

Funding a Trust

The process of transferring or connecting assets to a trust through deeds, account retitling, assignments, beneficiary designations, or other appropriate procedures.

 

G

Gift Tax

A federal tax system that may apply when a person transfers property to another person without receiving equivalent value in return. Exclusions and exceptions may apply, and a taxable gift does not necessarily mean that tax is immediately owed.

Grant Deed

A commonly used California deed that transfers an interest in real property and includes certain implied assurances by the grantor.

Grantor

In a trust, a person who creates or contributes property to the trust; also called a settlor or trustor. In a deed, the grantor is the person transferring the real property.

 

G-H

Guardian

A person appointed by a court to care for a minor child, manage the child's property, or both. A parent may nominate a proposed guardian in a will, but the court makes the final appointment.

HIPAA Authorization

A document authorizing designated persons to receive protected health information from health care providers or health plans.

 

I

Incapacity

A condition in which a person is unable to make or communicate certain personal, financial, or health care decisions. The applicable standard may depend on the document and the law.

Individual Property Assignment

A document used to assign specified personal property to a trust. Assets requiring separate title or registration procedures generally must be transferred by those procedures.

Intestate

Dying without a valid will. Property not controlled by a trust, beneficiary designation, joint ownership, or another transfer arrangement may then pass under California succession law.

Irrevocable Trust

A trust that generally cannot be revoked by the person who created it. Irrevocable trusts can involve complex legal and tax consequences and ordinarily require attorney and tax advice.

 

J-L

Joint Tenancy

A form of co-ownership that commonly includes a right of survivorship, causing a deceased owner's interest to pass to the surviving joint owner or owners.

Living Trust

A trust created during the trust creator's lifetime. Most consumer living trusts are revocable, meaning the creator may generally amend or revoke the trust while competent.

Living Will

A general term sometimes used for written health care instructions. In California, those instructions are commonly included in an Advance Health Care Directive.

 

N-P

No-Contest Clause

A provision intended to discourage certain challenges to a trust or will. Whether the provision is enforceable depends on California law and the nature of the challenge.

Personal Property

Property other than real estate. It may include household belongings, vehicles, bank accounts, investments, business interests, and other assets.

Per Stirpes

A method of distribution by family branch. If a beneficiary dies before the distribution date, that beneficiary's share generally passes to the beneficiary's descendants, subject to the language of the document.

Pour-Over Will

A will commonly used with a living trust. It generally directs that property subject to the will be transferred to the trust after death. Property passing under the will may still require a court or other estate-administration procedure.

Power of Attorney

A written document authorizing another person, called an agent, to act on the signer's behalf for specified financial or property matters. A power of attorney ends when the signer dies.

Probate

A court-supervised process that may be used to administer and distribute certain property after death. Not every asset is subject to probate. LDA Document Services does not provide probate document services.

 

R

Real Property

Land and permanently attached improvements, such as a house or other building.

Restatement

A complete replacement of the operative terms of an existing trust while generally continuing the original trust rather than creating an entirely new trust.

Revocable Living Trust

A living trust that the creator may generally amend or revoke while competent. It may hold and manage property during life and provide instructions for management during incapacity and distribution after death.

Revocable Transfer on Death Deed

A California deed that may transfer qualifying real property to a named beneficiary at the owner's death while remaining revocable during the owner's lifetime. Strict execution and recording requirements apply, and the deed may not be suitable for every situation.

 

S

Separate Property

Property that may belong to one spouse individually, such as qualifying property owned before marriage or received by gift or inheritance. Classification can be legally complex.

Settlor

A person who creates a trust. Also called a trustor or grantor.

Special Needs Trust

A trust designed to hold and manage assets for a person with a disability while addressing eligibility for certain means-tested public benefits. This is a specialized area requiring qualified legal advice.

Successor Trustee

The person or institution designated to serve as trustee when the current trustee dies, resigns, becomes incapacitated, or otherwise stops serving.

 

T

Tangible Personal Property

Physical personal property that can be touched and moved, such as furniture, jewelry, artwork, household items, and vehicles.

Tenancy in Common

A form of co-ownership in which each owner holds a separate fractional interest that may generally be transferred during life or at death.

Trust

A legal arrangement in which a trustee holds and manages property according to written instructions for one or more beneficiaries.

Trust Agreement

The document stating the terms under which trust property is held, managed, and distributed. It may also be called a declaration of trust or trust instrument.

Trust Funding

The process of transferring or connecting assets to a trust so that the trust can control those assets as intended.

Trust Property

Assets legally held in, titled to, or validly assigned to a trust.

Trustee

The person or institution responsible for holding, managing, and distributing trust property according to the trust document and applicable law. A trustee owes fiduciary duties to the trust beneficiaries.

Trustor

A person who creates a trust. Also called a settlor or grantor.

 

W

Will

A document stating how certain property should be distributed after death. A will may also nominate an executor and proposed guardians for minor children. A will generally does not control assets passing through a trust, joint ownership, or beneficiary designation.

 

Estate Planning Glossary • Educational information only

LDA DOCUMENT SERVICES | LEGAL DOCUMENT PREPARATION

Important Notes:

This glossary is designed for general consumer education and is not a substitute for individualized legal or tax advice.

 

LDA Document Services prepares documents only at the client's specific direction and does not select legal strategies or determine which documents are appropriate.

 

Clients should consult a licensed California attorney when they need advice about property classification, tax planning, blended-family issues, creditor protection, special needs planning, disputed family relationships, or the legal effect of a document.

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Federal tax amounts and rules change periodically. Current information should be confirmed with the IRS or a qualified tax professional.

LDA Document Services does not provide probate document services.

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Reference Sources

1. California Probate Code provisions governing advance health care directives and powers of attorney for health care.

2. California Secretary of State, Advance Health Care Directive Registry.

3. Internal Revenue Service guidance concerning federal gift and estate tax rules.

Glossary text for clarity, California focus, and current website use.