If you’re like most people, you appreciate access to a dictionary so you can check out the meaning of words that you’re not used to using every day. As you enter the world of estate planning, there is sure to be new lingo. Here are estate planning terms that begin with the letters, A, B, and C.

Agent or Attorney in fact

Someone you trust to act on your behalf under a power of attorney. It is NOT the same as an attorney at law.

Ancillary Probate

The administration of an estate in a state where the decedent owned property but was not domiciled (or was not a resident).

For example, the decedent lived in Kentucky but owned a vacation home in Florida. Florida would be the state of the ancillary probate.

Applicable Exclusion Amount

The amount you can pass on without incurring federal estate tax.

B Trust

A trust which holds the assets protected federal estate tax free because of the applicable exclusion amount of the first spouse to die.

The B trust is also known as the “bypass trust,” “family trust,” and “credit shelter trust.”

Beneficiary

The recipient of assets from a will, trust, life insurance policy, retirement account, annuity, estate, or any other asset.

Bill of Sale

A form used to transfer your tangible personal property (property you can touch, other than real estate) into your trust.

Capital Gains Tax

The income tax on the sale (or exchange) of an investment, such as stocks, bonds, or real estate.

For example, you buy a stock for $50 and sell it for $75. There will be a capital gains tax on the $25 increase.

Community Property States

Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. In these states, husband and wife each own an undivided one-half interest in community property assets.

Corpus

The principal of a trust. Not the income (such as interest, dividends, or gains) that the principal creates.

If you have questions about these estate planning terms or any others, consult with a qualified estate planning attorney.