Articles Posted in Estate Planning

Estate planning in New York is essential for the efficient settlement of a decedent’s estate.  The New York Probate Lawyer Blog has published many articles regarding planning an estate.  The various documents which may be prepared as part of a plan include a Last Will and Testament, Living Will, Health Care Proxy, Power of Attorney and Living Trust.  In short, these papers can be described as follows:

• Last Will and Testament: contains various provisions detailing a testator’s intentions and directions for the disposition of assets which are owned by a person in his name alone.  It is essential to remember that assets which are held jointly with others or have named beneficiaries, such as a life insurance policy, are paid directly to the designated surviving parties and are not controlled by a Will.
• Living Will: has provisions which explain a person’s intention and desire not to be artificially kept alive if their ability to live is intrinsically lost such that they are brain-dead.

The probate of a Last Will and Testament is essentially the procedure by which a Will is validated by the Surrogate’s Court.  The New York trust and estate laws contain many provisions which are intended to protect the sanctity of a Will and insure that the intentions of a decedent are carried out.

First and foremost are the provisions contained in Estates, Powers and Trusts Law Section 3-2.1 entitled “Execution and attestation of wills; formal requirements.”  This statute sets forth the various requirements for the signing of a Will.  There is a requirement that the Will be written, that there be at least two (2) attesting witnesses and that the Will be signed by the testator at the end.

The basic requirements found in the statute ensure that a decedent’s wishes which are expressed in the document are legitimately preserved.  When a person dies it is apparent that he is no longer around to certify and authenticate the dispositions that he set forth in the document.  The New York Probate Lawyer Blog contains numerous articles explaining and discussing the probate process.  New York probate and estate lawyers are familiar with the estate laws.

Estate planning in New York is important for the proper disposition of a person’s assets.  Planning an estate encompasses a broad array of considerations.  The New York Probate Lawyer Blog has published many articles on this topic.  Initially, the preparation of a Last Will and Testament is the central document when creating a plan.  A Will disposes of assets that are owned by a testator at death in his name alone.  Thus, assets which pass automatically to others by operation of law such as joint property or items which have designated beneficiaries such as retirement accounts, life insurance or other pay on death funds, are not generally controlled by the terms of a Will as long as the beneficiary survives a decedent.

In view of various rules regarding property disposition, it is imperative that any estate plan take into account the ownership and title of assets which are intended to be disposed of under a Will.  A recent Manhattan estate case, decided by Manhattan Surrogate Rita Mella on February 23, 2023 entitled Estate of McAulay, demonstrates the issues that may arise when a decedent’s asset ownership conflicts with the provisions of a Will.

In McAulay, the terms of a Will provided for equal distribution of a portion of the decedent’s residuary estate to four (4) individuals.  At the time of death, the decedent owned certain California real estate with one of the beneficiaries as joint tenants.  As a result, the California property passed to the joint owner by operation of law outside of the Will.  An issue was raised as to whether the value of the California real estate should reduce the amount of the share of the residue the beneficiary was to receive.

Estate planning in New York involves many different aspects.  Initially, a person needs to consider and develop the manner in which an estate is to be distributed.  Decisions need to be made concerning the various beneficiaries who are to receive distributions.  Also, the amount of payment to each beneficiary under a Last Will and Testament must be decided upon.  Another aspect for review involves whether or not a Will should contain a testamentary trust in which the beneficiaries’ share would be held rather than paid out immediately in one lump sum.  A trust can be established for a spouse, child or a third party beneficiary.  Sometimes a Supplemental Needs Trust is established to preserve governmental benefits for a beneficiary with a disability.

An estate plan should be made with attention to estate settlement.  Executors need to be named.  Contingency provisions should be included such as alternate beneficiary provisions in the event of a change of circumstances such as the death of a beneficiary preceding the decedent.

There are situations when the actual provisions of a Will need to be changed either due to circumstances or preferences by the testator.  In these cases, it is essential to remember that all Wills and alterations that are made on Wills must satisfy the requirements of Estates, Powers and Trusts Law Section 3-2.1 entitled “Execution and attestation of wills; formal requirements.”  This provision sets forth requirements regarding the signing of a Will and the need for two attesting witnesses.  Sometimes a person may prepare and execute a Codicil to a Will.  A Codicil is an amendment to a Will which needs to satisfy the EPTL 3-2.1 execution requirements.  Since the Codicil and the original Will need to be read together, there is the possibility that the language in the two documents may be confusing or ambiguous.  In my view, the better course to follow is to prepare a new original Last Will in the place of the old one, incorporating the new provisions.  This way there is less of a chance of confusion and there is no need to locate two documents at the time of probate.

Estate planning in New York is important for many reasons.  Primarily, when a person plans their estate, they are ultimately creating documents and situating assets to reflect their intentions regarding the ultimate disposition of these items.  Nowadays, estate planning is often viewed as a broader topic and includes papers that are referred to as advance directives.  These would include a Power of Attorney, Living Will and Health Care Proxy.  The more traditional estate planning papers include a Last Will and Testament, and possibly a living revocable trust or even an irrevocable trust.  The New York Probate Lawyer Blog has published many articles relating to the various documents identified above.

Any type of planning document requires that the person creating the paper consider the selection of various types of fiduciaries.  These fiduciaries include executors, trustees and agents acting pursuant to a power of attorney or health care proxy.  It may also include the nomination of a guardian for a minor child.  In most cases, the appointment of a fiduciary is simple and the choice is typically a spouse or child or other close relative or friend.  However, there are many situations where the selection is not as clear cut and various considerations need to be taken into account.

One issue which should be analyzed is whether the proposed appointee is willing to accept the appointment.  Not everyone wants to accept the responsibility of being an estate executor or trustee of a trust.  It is always a good idea to ask the proposed fiduciary if they would accept the appointment.  This avoids having to find a replacement once a document comes into effect.  While a substitute appointment in the document is always advisable, there is no assurance the substitute would be available or want to accept the task.

Many articles have been written about New York estate planning when a couple is considering or entering into a divorce.  The New York Probate Lawyer Blog has published a number of articles on this topic in the past.  However, it is important from time to time to review this information.

Spousal rights are a very special area when considering estate issues.  This is due to the fact that New York estate laws provide a surviving spouse with certain rights, most importantly a spousal right of election.  This prevents a surviving spouse from being disinherited.  Estates, Powers and Trusts Law Section 5-1.1A entitled “Right of election by surviving spouse” essentially provides that a surviving spouse is entitled to receive at least one-third of a deceased spouse’s estate.  So, even when spouses are engaged in actual or possible divorce proceedings, the death of one may still result in an inheritance by another.  Until there is a final divorce or a waiver of spousal rights, a feuding husband and wife may be subjected to inheritance rights.  I have seen many cases where parties have been separated for many years, even decades, but a spousal right of election might still apply.

As can be imagined, even though parties may change their Last Wills and Trusts and other asset dispositions, inheritance by a surviving spouse prior to a divorce may not be avoided.  However, once parties do officially become divorced, there are still many items to be taken into consideration.  While a divorce may nullify preexisting provisions in Wills or other post-death beneficiary designations, these documents should not be left to chance.

One of the benefits from implementing a New York estate plan and preparing a Last Will and Testament is the ability of a testator to select an executor.  This option does not exist when a person dies intestate without a Will.  In such a situation, the estate administrator is determined pursuant to the estate laws contained in Surrogate’s Court Procedure Act Section 1001 entitled “Order of priority for granting letters of administrations”.

The selection or nomination of an executor, as well as a substitute executor, is a very important aspect of Will preparation.  Such person, once appointed by the Surrogate’s Court, is in charge of handling all estate affairs.  This includes determining and collecting estate assets, paying expenses, resolving estate claims and liabilities, and ultimately, making distributions to the estate beneficiaries.

An executor is essentially the chief operating officer regarding all aspects of the estate.  He must deal with lawsuits concerning the decedent’s affairs and select and interact with accountants and attorneys needed to perform services in furtherance of estate settlement.  The New York Probate Lawyer Blog has published many articles regarding estate fiduciaries and administration issues.

Estate planning in New York encompasses many types of considerations.  The most common way to plan an estate is to prepare a Last Will and Testament.  When a person dies, a Will must be filed with the Surrogate’s Court to be validated.  This is known as the probate process.  Probating a Will involves filing a petition with the Court.  All of the decedent’s next of kin must be given notice of the proceeding.  Most probate matters are rather routine, and the Will is admitted to probate, and letters testamentary are issued to the nominated executor.  The New York Probate Lawyer Blog contains many posts dealing with estate administrators and estate settlement.

Sometimes a person desires to avoid probate.  There can be many reasons for avoiding a Court proceeding.  One of the main goals is to avoid a possible Will contest.  Another reason may be to prevent a search for next of kin who may need to receive notice in the probate case.

The creation of a Living Trust or a Revocable Trust is a means by which assets can be transferred without the need to probate a Will.  In order for a Living Trust to be effective, all of the grantor’s assets must be transferred into trust ownership.  This transfer is easy for financial accounts where the title of the account can be changed into the name of the grantor as trustee of the trust.  Other assets, such as real estate or the ownership of a cooperative apartment, may be more complicated.  As to real estate, a deed and other transfer documents must be prepared and filed with the appropriate county office to show the transfer of the ownership into the trust.  Tax forms and other recording papers and fees need to be properly accounted for.

It is apparent that the preparation of New York estate planning documents is important.  A lot of time and effort can be expected in connection with reviewing assets and financial interests, figuring out the manner in which dispositions are to be made to beneficiaries and implementing the papers and documents to formalize the plan.  In view of the commitment to start and finish this procedure, it is equally important to make certain that the documents that are prepared are correctly and properly created and also executed.

While there are many considerations involved in the above process, these three (3) areas should be at the top of the list.

Expressing Creator’s Intentions:  The whole point of planning an estate is to insure that a testator or creator of a document can memorialize his intentions regarding the disposition of assets.  Thus, the papers that are prepared, whether a Last Will and Testament or Living Trust or even advance directives, such as a power of attorney or health care proxy, should contain clear and unambiguous provisions and directions.  It makes sense to consult with an estate lawyer who is familiar with drafting clauses which effectuate intentions regarding bequests and contain appropriate dispositive language.  Even the simplest of documents may require clauses dealing with alternative or contingency dispositions.  Also, it may be necessary to include specialized language concerning estate tax matters or the payment of estate debts or expenses.  A well drafted, unambiguous Will or Trust is essential for the creator’s intentions to be accomplished.