Estate Planning

Wills and Trusts

Wills and Trusts are important documents for everyone to create, but especially if the Guardians you select to care for your children or the family, friends and charities you favor as beneficiaries differ from what the law would presume to be your wishes. Carol will meet with you to understand the values and beliefs which shape your relationship with your assets, and the family, friends, or charities you care about, so that, together, an estate plan is created which resonates for you, directs what happens to your property upon death, and appoints representatives of your own choosing to carry out your wishes. We will also help you update these documents periodically to account for life changes. Even those who have Wills or Trusts in place should consider whether changes might be needed for any of the following reasons:

You are newly married

You are expanding your family through birth, adoption or surrogacy

You are ending a marriage or dissolving a long-standing relationship

You are buying a home or investment property with someone else, or contemplating commingling assets with another person

You have a recent inheritance or there has been a significant change in your financial status

You are experiencing medical issues which limit your physical or mental capacity

A loved one or named fiduciary has died or is experiencing growing mental incapacity

It is important to understand that the State of New York protects your assets by establishing your “default” plan, if you haven’t expressed your wishes through a Will or otherwise. This “statutory will” determines how your property will pass to your relatives, regardless of your wishes or the quality of your relationship with those relatives. For some people the statutory plan makes sense.

But for others, particularly if you are not married, or if your children are not biologically or genetically related to each parent, or if your friends are your “family of choice” and you wish to favor charities, an estate plan is critically important.

What should I bring with me to my first estate planning meeting with my attorney?

In most cases, whether this is your first attempt at formulating an estate plan, or you are revising a longstanding estate plan due to a change in circumstance, the attorney with whom you work will need to review your current financial documents, and gather important information that may assist in any subsequent probate or incapacity. Here are just some of the documents and information to be gathered for this important first meeting:

Driver’s license or passport for identification purposes

Copy of marriage certificate and/or other kinds of relationship recognition certificates which are applicable to your relationship

Civil union, domestic partnership, etc

Copy of birth certificates

And/or adoption certificates/parentage orders for your children

Copy of judgment(s) of divorce or terminations of other relationship recognitions

Domestic partnerships terminations, etc. for former partners/spouses

Copy of deed(s) or stock certificate(s) to any home, second home(s) or investment property(ies)

A list of assets and liabilities and/or copies of recent statements

Copy of any current property agreement(s) between you and anyone else

Or other kinds of domestic partnership or prenuptial/postnuptial agreements

Copy of any separation agreement(s), termination agreement(s), etc. with former partners/spouses

To the extent financial obligations still apply, such as child support obligations, or an obligation to maintain life insurance etc.

List of any and all primary and secondary (contingent) beneficiaries on any financial assets

List of employer death benefits, life insurance, tax deferred or qualified assets such as 401K’s, etc. and list of beneficiary designations, both primary and secondary

A list of other persons/charities meaningful to you with full names, addresses and mobile phone numbers

Particularly if you plan on naming the person/charity in your will or name the individuals in some fiduciary capacity, such as successor Executor, Trustee, Health Care Proxy or Power of Attorney; and List of all members of your immediate family, with full names of children, parents, siblings, siblings’ children, and if none of the above, a more formal family tree beginning with maternal and paternal grandparents

What documents will be prepared on my behalf?

Most estate planning attorneys, will suggest that you sign a number of documents which will ensure that your loved ones and nominated fiduciaries have the authority to care for you during any physical or mental incapacity prior to death, can carry out your wishes with respect to organ donation, burial or cremation, and can then carry out your wishes with respect to your property upon your death.

Last Will and Testament

Wills are the most basic tool of estate planning. A will can be simple or complex, but the important thing is that it clearly reflects your personal priorities, wishes and values. There are statutory formalities that must be followed when signing a will and a knowledgeable attorney supervising the execution of your will ensures that others will accept the document as your last will and testament.

Trusts

There are two kinds of Trusts: Living Trusts and Testamentary Trusts.

A Living Trust (also called an inter vivos trust) is created by a living person or “grantor” and is effective during the grantor’s lifetime. Your attorney can prepare a Trust, but it is important for you to then transfer assets into the trust, that is, “fund” the trust. Deeds to real property in your individual names must be transferred into the trust. Financial accounts must be re-titled from your name, individually, into the trust. This generally takes time to accomplish. An attorney can help you weigh the benefits of transferring assets into the trust against the expense during your lifetime and the financial benefits, if any, upon your death. Transferring assets into a trust may solve one set of problems, while at the same time, opening the door to other problems and expenses.

It is important to understand that a trust is a relationship, not a document. Trusts take many forms and accomplish specific things, Here are just some examples of different types of trusts:

Revocable Trust

The person establishing this trust retains full control of any assets transferred into it. The trust can be amended, revoked, or restated. Assets can be removed or added at any time during your life. Upon your incapacity your successor trustee continues to utilize your assets, but only for your benefit. Upon your death your successor trustee distributes your assets to your friends/family/charities according to your wishes as expressed in the Trust document.

Irrevocable Trust

The person establishing this trust gives up the ability to change the terms. Someone other than you is the Trustee, and this person manages the assets transferred into the trust for your benefit, or as you otherwise express in the Trust document. But there may be a substantial benefit in transferring the assets, such as reducing estate taxes, obtaining Medicaid coverage for long-term care, or protecting assets against outside claims.

Property transferred into a Living Trust, whether it is revocable or irrevocable, does not have to go through probate and may be distributed to your chosen beneficiaries or even held in a continuing trust after you are gone.

Testamentary Trust

A person establishes this trust under a will and the trust does not come into effect until after the person has died. Some examples of Testamentary trusts are: (1) trusts established for the benefit of a child, with the distribution of assets postponed until the child is a little older and able to make good financial decisions, and (2) Trusts established for the benefit of a disabled adult to protect the assets from medicare claims. You may have been advised by your financial advisor that you need a trust. You may have a close friend or relative who has a trust and believes you need one as well. Or perhaps you have extensively researched this issue and are just trying to understand if you would benefit from this estate planning option. We can sit down together and review the options, the tax implications, the costs involved in establishing the plan, weighed against the possible long-term benefits and make a decision together that resonates for you.