Articles Posted in Estate Administration

will-300x150As our political landscape is more uncertain than ever after this week’s election results, our readers  cannot be certain that estate tax repeal is on the horizon.  Also, most people do not own substantial assets so that estate taxes may apply to their estates.  However, most of our clients  could benefit from the drafting of a Will and other estate documents by a skilled attorney.  This post will address the benefits of engaging a qualified attorney to draft your estate documents.

Without a Will, one’s property will be left according to the laws of intestacy.  Intestacy distribution through an administration proceeding may serve most people well enough.  For instance, if one’s closest surviving relative is a daughter with whom there is a good relationship, the parent would have no problem with the daughter inheriting her entire estate.  However, if there is also a son with whom the parent has an estranged relationship, intestacy would result in both children sharing in the estate equally.  Since this is not a result favored by the parent, the drafting of a Will is essential so that the parent’s wishes that only the daughter inherit will be honored.  Also, should the parent wish for both children to inherit, but in unequal portions, a Will would be needed to address this desire.  Likewise, a Will can allocate responsibility for the payment of estate taxes between beneficiaries and may direct that only certain assets be liquidated in order to pay estate taxes.

When working with an attorney  to draft estate documents, the opportunity to select an executor to manage the estate is also available.  Otherwise, with intestacy, the person who inherits the estate also is appointed to serve as administrator to manage the estate.  This may not be a favorable result if this person is not as prudent in managing money as another person that may be selected by the decedent.

fatherOur firm wants to extend its best wishes to all Dads for a happy Father’s Day.  We would like to mention some gift ideas of a legal nature that cannot be purchased in an ordinary department store.

Your Father may be on the verge of retirement.  As such, he may be in the market for a qualified attorney  who will negotiate and document the terms of his business sale.  Such a sale may involve preparation of a contract of sale, coordination of the payoff of a business or equipment loan, closing document drafting and the like.  Once the transaction is complete, your Dad can enjoy a care-free retirement.

If your Father is not ready to retire, he may have an ongoing business in the process of relocation.  Our attorneys would welcome the opportunity to negotiate the commercial lease for the new space. We would negotiate its terms in a manner most favorable to dear old Dad.

18If you are like this author , someone close to you may be about to turn eighteen years of age.  This post will discuss the legal ramifications of turning eighteen.  Additional rights and privileges as well as legal responsibilities occur once a “child” becomes eighteen.  Such a person can now vote, run for office, legally support oneself, and be employed full-time.  An eighteen year old male will be penalized if he does not register for the military draft.  All eighteen year olds are treated as adults if they commit a crime.  Since we  practice particular areas of law, this author will address the implications of turning eighteen as they apply to those areas of law.  Also, rights and obligations vary by state, so this post will only address these matters as they relate to New York.

Eighteen year olds have the right to enter a contract and to apply for credit.  Therefore, our soon-to-be eighteen year old can apply for a mortgage and sign a contract to buy a house.  Contracts involving real estate, whether for sale or for a lease of more than one year must be in writing.

Once a person is eighteen, he can make a Will and other estate documents.  While we do not want to consider that someone so young may pass away, without a Will, his assets will be distributed according to New York’s intestacy law.  Also, an eighteen year old can inherit from someone who named him in a Will or in an Administration proceeding if he is of the proper degree of relation according to the New York statute.  Since many eighteen year olds may not be sophisticated enough to inherit substantial assets, those drafting Wills may decide to leave such assets to the child in trust until such age as they anticipate that the child will be mature enough to manage the assets.

210deathThe timing of death is never particularly welcome.  Some families are prepared, in that the deceased was elderly, maybe ill, and living in a nursing home.  Perhaps such a person also had the foresight to have their attorney prepare her Will and other estate documents.   Others may pass away at a relatively young age, in the prime of life, with ongoing financial and personal activities.  This post will examine the legal ramifications of passing away while a legal matter is pending.

Imagine that the deceased was a party to a contract concerning the sale of a house which has not yet closed.  The first step that the survivors would need to undertake is to review the contract and determine if it addresses the potential death of one of the parties before the closing.  In most cases, the seller is bound to the terms of the contract through her successors.  This means that the survivors cannot decide to nullify the contract and move into the house.  However, the seller is not available to conclude the transaction.  The attorney for the seller  would need to apply to the Surrogate’s Court  to apply for Letters Testamentary or Letters of Administration , which appoints the appropriate fiduciary to act for the Estate in order to complete the closing.  Should circumstances warrant, it may be prudent to apply for Preliminary Letters Testamentary or Preliminary Letters of Administration, to permit the sale to conclude if it is jeopardized by a continued delay.

If the deceased was the potential purchaser of the house, the contract is likely to allow the purchaser’s survivors to cancel the contract.  This is a logical result, as the transaction is inherently dependent upon the purchaser maintaining a job in order to pay the mortgage and other carrying costs of the house.  Forcing this transaction to conclusion is a cruel result.  In most cases, the downpayment is refundable.  However, some contracts only provide that half or none of the downpayment would be refunded.  It is advisable to have your attorney negotiate a favorable disposition for the downpayment in this instance when representing a purchaser, even if he is a young person.

starwarsMovie fans recently learned of the deaths of Carrie Fisher and her mother Debbie Reynolds, which occurred within one day of each other.  Those with symbiotic relationships, such as spouses married for more than fifty years, sometimes die within a close timeframe from one another.  This phenomenon is known as dying of a broken heart.  This post will discuss the legal ramifications of deaths occurring within close proximity.  This author will assume that the persons are husband and wife.

Spouses can pass away in close succession as a result of a sudden event such as an airplane crash or due to natural causes such as failing health in old age.  New York State has adopted its own version of the Uniform Simultaneous Death Act.  This statute provides that if two or more persons who are heirs to one another die within one hundred twenty hours of each other, that they are deemed to predecease the other.  Their estates would then be treated in accordance with the intestate provisions of New York’s Estate Powers and Trusts Law , with their property eventually being inherited by those individuals surviving them in the order as designated by the statute.

There are exceptions to the simultaneous death statute.  Such provisions do not take effect if the result would be that the person’s estate escheats to the state.  Escheat means that when there are no surviving relatives who may inherit, the state receives the property.  In addition, the beneficiary designations in a person’s life insurance policies or specifications contained in legal documents such as a will or trust take precedence over the statute’s simultaneous death provisions.  Your attorney  may advise a couple to include “mirror image” clauses in their wills wherein the wife is deemed to survive the husband in the event of deaths occurring within a certain period of time from one another, preferably in the range of sixty to ninety days.  There may be estate tax concerns that determine which spouse should “survive” the other.  Also, a person may wish to include a provision stating that a particular person should be considered to have predeceased her if she has personal reasons to disinherit a particular person.

thanks2016The upcoming Thanksgiving holiday requires quite a bit of planning.  We are not speaking merely about creating the menu, shopping for the required ingredients and preparing the delicious food.  Rather, we wish to call attention to those who will be sharing the holiday with you and the legal issues that may arise.

Our readers should consider those people who will be at the dinner table with them.  These people are likely to be relatives, some of whom may be able to inherit your estate from you if you die without a Will.  Should this result be inconsistent with your wishes, we suggest that you contact a qualified attorney and arrange for your wishes to be documented in a Will and other associated estate documents.  Also, consider the legal issues that arise should you be sharing the holiday with a step-parent.  In addition, it may be prudent to think about those from whom you may inherit, such as your parents, to address whether they have made the proper estate plans to legally include you.

Observe the items that are on the Thanksgiving table and throughout the home.  Is the valuable sterling silver flatware being used in the celebration?  Personal property also needs to be addressed in estate documents and should be safeguarded, so as to prevent it from landing into the wrong hands.   Should a family member’s estate already be in the administration or probate process, you may need to be prepared to sort through family items and manage who should take such items with them.  Perhaps you may want to encourage your relatives to part with some of their valuable personal property now, so as to potentially save on gift and estate taxes at a later time.

reliestphotoMany of our readers are about to celebrate Rosh Hashanah.  We wish those who observe a happy and healthy new year.  At this time of year, those of the Jewish faith tend to reflect upon their acts during the past year and to set goals for improvements in the following year.  Attorneys can provide the opportunity for one’s religious, moral and ethical values to be reflected in a final legacy, such as a Will or Trust.   This post will discuss the means by which your attorney will insure that your values are properly contained within your estate documents.

Primarily, we suggest that you meet with a skilled professional , who is prepared to discuss your ethical values.  The meeting should not only address the standard discussion of who should serve as fiduciaries (those named in the Will to act on behalf of the estate such as executors, trustees and guardians) and who should inherit your assets.  For instance, a couple with minor children typically needs to determine who will serve as guardians to raise their children if they pass away.  If religion is important to such a couple, they may want to appoint someone of the same religious background who will be instructed to continue the religious instruction and ritual observance to which the children have been accustomed.  It is possible that a separate fiduciary may need to be named to handle financial matters for the children when a religiously sensitive guardian has been selected.

Discussions should be undertaken as to the distribution of assets.  Authorizing a trust to distribute assets for religious education and travel, in addition to the standard education expenses, may be appropriate.  Charitable matters should also be considered.  If charitable giving is an important value to the client, we discuss the means by which charitable giving can be accomplished.  Gifts made during lifetime typically have less significant tax consequences and the donor may be recognized personally for the contribution.  However, the donor may need the assets during her lifetime and would rather part with them at a later time.  Charitable trusts can also be established if appropriate.  Our firm commonly coordinates with various organizations that are prepared to assist in the establishment of such charitable trusts.

property-dividedOur firm is often consulted in situations where a number of individuals have inherited real property.  For example, a parent passes away, and leaves a house to her three children. Many legal issues can arise from this type of situation, which will be discussed in this blog post.

The first question when a property owner dies is whether they have a written will.  If they do, then their Last Will and Testament should direct the disposition of the said property.  For example, the Will may state “I leave my property located at (address) to my three children (names of children).  Another possibility is that the property is not specifically addressed, but the testator (the person making the Will), simply leaves all of their property owned at time of death jointly to their children.

If the person dies without a Will (intestate), then the disposition of their property, including any real property, is made pursuant to New York Estate Law. For example, if a person passes away without a Will, and has no living spouse or parents, then their property would be inherited by her living children.

prince2In a prior post , we  discussed the death of the musician Prince and speculated about matters pertaining to his estate.  Since that time, the public has become aware of the tragic circumstances of his death and that he did indeed die without a Will.

In New York, person dying without a Will is deemed “intestate”.  The proceeding held in Surrogate’s Court  is then called an Administration Proceeding.  In such a proceeding, those persons inherit depending upon their proximity in relationship to the deceased.  For instance, if the deceased died without a spouse or children, then his parents would inherit from the deceased.  With the estimated $300,000,000 estate at stake in the Prince case, random people may have an interest in claiming to be “related”.

Recent news reports have indicated that the Judge in the Prince case has limited those who claim to be Prince’s “relatives”.  Even a person serving time in prison made such a claim.  A DNA test was administered to the inmate to eliminate his claim in the estate.  Others were not offered blood testing.  While we can debate which persons should have been more thoroughly considered through DNA and blood testing, the mechanism shows that the Court will look at scientific evidence when necessary to determine whether a claimant is indeed related.

militaryMany of our readers are looking forward to the upcoming Memorial Day holiday weekend.  Most of us are thinking of spending time at a backyard barbeque or taking advantage of a sale at a department store.  Memorial Day also has a more somber connotation, thanking our military for the ultimate sacrifice that they have made for our country.  As attorneys, we wish to bring to your attention particular legal matters with which we can assist should your loved one make such a sacrifice for our country.

We think of our military as young and not wealthy as yet.  Saving estate taxes is not the concern of this population.  However, estate and financial planning is still needed due to the inherent danger in their profession and their age.  For instance, an accident could result in permanent disability or death.  The service member may get married.  These changes could have significant consequences if the proper legal documents are not drafted by a skilled professional.

In the absence of a Will , the service member would be deemed to die intestate and an Administration proceeding would be required to manage the person’s assets and liabilities.  Concerns with the disposition of personal property need to be addressed, preferably in a Will.