Within One Will, Lessons on What not to Do

Apr 24, 2014  /  By: Barton P. Levine, Esq.  /  Category: Beneficiaries, Estate Planning

For those with considerable wealth, they’re seemingly always surrounded by financial and legal people, all with sound advice. When you’re a celebrity, multiply it by ten. That’s why it’s difficult to understand L’Wren Scott’s motives now that her will has been read. Scott, a well recognized celebrity who also happened to be in a serious relationship with Rolling Stones’ founder Mick Jagger, took her own life in March. Since then, her will has been unveiled and it’s causing more than a few hurt feelings – not to mention the legal inconsistencies.

Scott left her entire estate, valued at $9 million, to Jagger. She also left nothing at all for her two siblings – and they’re not taking it well. In New York, the law is clear: if you die intestate (without a will), a drawn out process begins in which a fiduciary is appointed by the courts. Scott recognized the importance and made sure those bases were covered. Beyond that, it gets complicated when trying to understand her reasoning.

As mentioned, she left her estate to Jagger and as for her siblings, they’ve been invited, via a personal message in her will, to “start a lawsuit”. That’s exactly what will happen since New York law also is clear on what happens when the obvious does not: the next of kin is assumed to receive the estate and when that didn’t happen, those siblings now must either consent to her wishes or begin a court hearing.

Scott’s will is less than a year old, too. This could present the opportunity for those siblings to claim her mind wasn’t right and she lacked the necessary legal capacity to properly execute it. Make no mistake: this can drag on for years, but they just might win. Further complicating matters is that an attorney in California drafted her will. Further, the attorney overnighted the will to her and did not actually witness her sign it. Again, this could be grounds for overturning the will since it very well may not meeting the necessary formalities for its legality.

Next, we take a look at her decision to stop at a will. If she wanted to “lawsuit-proof” it, she could have – and indeed, should have – established a trust for Jagger. This would have saved him a lot of headaches that are now going to affect his life.

Consider the dynamics: Jagger’s already worth more than $300 million. Imagine his tax bracket. This gift Scott left him, of course, increases that estate. When he dies, there will be millions due in estate taxes because she failed to set up a proper revocable trust. Now, though, it’s part of his taxable state, creditors can actually come after him for that $9 million and she could have left instructions for how she wanted any remaining inheritance to be distributed at the time of his own death. Had she done this, she would have avoided the now-necessary court hearings, her siblings wouldn’t have been forced to consent to the will or battle it out in court with Jagger’s lawyers and in fact, she could have even put a “no contest” clause in place that would have sealed the deal in terms of preventing her siblings from any kind of legal recourse. Naturally, that works best when those siblings are actually left something, which Scott’s weren’t.

The biggest purpose this latest legal brouhaha serves is a reminder for others of what not to do. Scott would have fared far better had she met with an estate planning lawyer in New York who truly had the best intentions at heart and who could have avoided what’s sure to be a costly and time consuming process for her siblings and the man she loved.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Former Marine Fights for Her Partner — A German Shepherd Named Rex

Apr 23, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

Dogs have long been referred to as “man’s best friend.” A service dog can be more than a friend — it can be your partner and protector. Take, for example, the case of Marine Cpl. Megan Leavey and her canine partner Sgt. Rex.

Leavey and Sgt. Rex completed over 100 missions during two six-month tours in Iraq before returning home in 2007. Upon their return home, the partners were separated. Leavey soon realized that her bond with Rex was a deep one and that she did not want to be apart from her canine partner. Leavey decided to petition for Rex’s adoption. Although adopting a military service dog is not a simply process, Leavey was determined to have Rex with her. With the help and support of U.S. Senator Schumer, as well as the signatures of over 21,000 supporters on an online petition, Leavey’s petition for adoption was finally approved just last week. Leavey and Sgt. Rex will soon be together again.

For anyone who has a beloved pet that is considered part of the family, be sure that you treat your pet as part of the family when it comes time to create your estate plan as well. A pet trust is an excellent way to guarantee that your pet will be well taken care of in the event that you predecease him or her.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Amy Winehouse Died Intestate — Another Example of The Importance of Estate Planning

Apr 21, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

Singer Amy Winehouse was found dead of alcohol poisoning last July at the young age of just 27 years old. While the world mourned the loss of Winehouse’s deep, soulful voice, speculation also began about who would receive her fortune. Initially, it was believed that Winehouse left behind a Last Will and Testament. Moreover, reports were that the young star had the presence of mind to update that Will when she divorced her ex-husband Blake Fielder-Civil. It appears as though those early reports were mistaken.

The probate of Winehouse’s state has now been filed. Probate documents show that Winehouse died intestate, or without leaving behind a Will at all. Since Winehouse was not married at the time of her death, and left behind no children, her entire estate will go to her parents. Despite the fact that she was supposedly still close to her ex-husband, and had a close relationship with older brother Alex, they will receive nothing form her estate because she did not leave behind a Will.

Winehouse is another in a long line of young stars who have died prematurely and who failed to leave behind an estate plan. Her story reminds all of us of the importance of creating an estate plan early on in life. Just as Winehouse shot to the top in a relatively short period of time, the same thing could happen to anyone. Without an estate plan in place, the vast fortune that you earn will be distributed according to state law in the event of your death, leaving your wishes out of the decision making process altogether.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Can You Probate Your Will Before You Die?

Apr 09, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning, Probate, Wills

Probating your Will before your death often makes practical sense. By pre-probating your Will, you can avoid confusion about your Will, including whether it is your most recent Will and if you actually died with a written Will. You do not have to keep track of your Will and do not have to provide multiple sets of instructions to your loved ones about where they should keep your Will. If you can probate your Will before your death, your county clerk’s office or county recorder can index and record it for public retrieval. Not all county recorders, probate courts, or circuit courts (names for courts vary by jurisdiction) can probate your Will before you die. If your local rules allow you to pre-probate or register your will before your death, you may want to ask your probate attorney to do so or speak with he or she as to whether it is a good idea. If you draft a will, but your relatives or executor cannot locate it, you may be subject to your state’s intestacy statute. This means that the heirs to your estate are not established by your will. Instead, the succession laws applicable in your state establish them.

Even if you can probate your Will before you die, you should let your heirs know so that your Will directs or controls your testamentary intent, instead of the state intestacy statute.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Why You Need to Avoid Ambiguity in a Last Will and Testament

Apr 08, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

An estate plan can be an elaborate set of legal documents or it can be as simple as a Last Will and Testament. In all estate plans, however, a Will is where it all starts. Your Will provides the basic framework and guidance for the way in which you want your estate handled upon your death. For this reason, you must be certain that you have not included any ambiguous terms in your Will that will cause your entire estate plan to become the subject of a long, drawn out estate battle. Not only will this hold up all of your estate assets for months, even years, but it will costs your estate a considerable amount of money in legal fees. Ambiguous terms in a Will can be found in almost any part of the Will, including the following:

  • Specific bequests – failing to describe the item with specificity so that a court is clear on what you are gifting. For example, using “my grandmother’s lamp” when no one is certain which lamp belonged to your grandmother
  • Specific bequests – failing to identify the person to whom you wish to make the gift with specificity. For example, using “my grandson” when you have more than one.
  • Residual clause – This is where the remainder of your estate is handled after specific bequests have been honored. Failing to name the beneficiaries with clarity can cause a problem. For example, saying “my heirs” may not be sufficient.
  • Residual clause – Failing to be clear about how much of the estate will go to each beneficiary.

Avoiding ambiguity is simple when you consult with an estate planning attorney. Although using a generic form may seem like a great money saver, in the long run it may cost your estate and your beneficiaries considerably more money than you saved.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Beware of Offshore Accounts

Apr 05, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

Years ago, sheltering money from taxes, creditors and even spouses by placing it in off shore accounts was a common practice for United States citizens. Times have changed though, and the U.S. government has really cracked down on loopholes that were used to avoid the payment of debts and taxes, including the offshore account tactic.

Despite changes in the laws relating to banking and taxes that all but make offshore accounts the thing of the past, unscrupulous companies continue to try and lure investors into transferring money into offshore accounts. This is one of those situations that falls into the “if it sounds too good to be true, then it probably is”. Advertisements abound by planners that claim they can set up accounts or trusts that will shelter money from U.S. taxes, creditors and even from current spouses or ex-spouses in the event of a divorce. While this sounds attractive, the asset protection an investor is looking for could actually land him or her in jail. At a bare minimum, the funds placed in those accounts will likely still be accessible by the U.S government and most courts. In some cases, the investor could be accused of outright fraud.

Before you become a victim, or worse a criminal, sit down and talk to your estate planning attorney. If there is a legal way to protect your assets from taxes or creditors, your estate planning attorney can help you do it without the risks involved in trusting a planner you don’t know.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Charitable Giving – Steps to Choosing and Including the Right Charities in Your Estate Plan

Apr 05, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

For many people, charitable giving is an important part of an estate plan. Choosing which charities to include in your estate plan, how to include them, and how much to give though can be a difficult process. According to the National Center for Charitable Statistics, there are over one million public charitable organizations in the United States alone.

If you already support a local charity, then you are ahead of the game. If you are still trying to decide which charities interest you, you may be able to narrow down your search by searching websites like charitywatch.org. Once you have chosen some possible candidates, make sure that the IRS recognizes the charities to ensure that your gifts will be tax deductible. You can check for IRS recognition using the Exempt Organization Select Check. Finally, you will likely want to look into how your gift will be used. What percentage of your gift actually goes to help your charity and how much is spent on administrative costs? Is your charity financially stable? Questions like these can be answered by looking up the charity on Charity Navigator.

Once you have decided on a charity or charities, sit down with your estate planning attorney and decide how you want to include your chosen charity in your estate plan. You may opt for a direct gift in your Last Will and Testament or you may want to create a trust that will provide continued giving long after you are gone.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Estate Planning for the Blended Family

Apr 04, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

A second or subsequent marriage often means that two families now become one. The period of adjustment that often accompanies a new marriage can leave both spouses a bit exhausted. Be sure that in the midst of all the other issues and concerns that you must address that you don’t forget some important estate planning considerations such as:

Obligations to a former spouse – a previous divorce decree may require you or your new spouse to pay child support. Alimony as well as could require maintenance of a life insurance policy. Failing to fulfill these obligations could give a former spouse a claim on the estate.

Beneficiary designations –people often forget that they made a former spouse a beneficiary on an old life insurance policy or retirement account. Now is the time to dig those out and change them.

Fiduciaries – You, or your new spouse, may also have made a former spouse, an executor, trustee, or agent in a power of attorney—designations that should be changed. If you designated an adult child in one of these roles, you may also wish to change that to a neutral third party now that you are part of a blended family.

Last Will and Testament – people often make the mistake of using a do-it-yourself Will and simply gifting everything to a spouse, and if the spouse is not alive to the children. Now that you are re-married though, this could mean that everything goes to your new spouse and then you have to count on he or she to leave assets to your children from a previous marriage upon death.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Why an Independent Trustee May Be a Better Choice

Apr 02, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

When it comes time to create an estate plan, many people choose to include much more than a simple Last Will and Testament. One common additional beyond a simple Will is a trust. One benefit to a trust is that it can be as simple, or as complex, as you need it to be. Regardless of how detailed your trust is, however, you will need to appoint a trustee. Although it may not be your fist thought, you should think about appointing a neutral, independent trustee.

Most people immediately think of appointing a spouse, parent, or adult child as the trustee of their trust. Appointing a family member may seem like the obvious choice; however, it can create more problems than it solves in the long run. People tend to choose a family member because they want to keep control of assets in the family or because they feel a family member can better understand family dynamics. While these may be valid points, there are other things to consider as well.

Being the trustee of a trust is typically a complicated and time consuming job. It usually requires a significant amount of experience and knowledge of both financial and legal matters – knowledge that a family member may not have. If your trustee makes even a simple, inadvertent mistake, he or she could be personally liable and trust assets could be forever lost. Furthermore, other family members may resent the appointment and the perceived control the trustee has over them if they are beneficiaries. In the end, it often makes more sense to appoint an independent trustee who has the requisite experience and knowledge to carry out the job well. Ask your estate planning attorney for recommendations for independent, professional trustees in your area.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.

Is It Time for a Family Meeting about Estate Planning?

Apr 01, 2014  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning

Estate planning is one of those things that people often put off. There are numerous reasons why people procrastinate; however, it frequently boils down to the simple fact that people don’t want to think about their own death. If you are one of the minority who has actually taken the time to create a comprehensive estate plan then you are to be congratulated – but don’t stop there. Isn’t it time to sit down for a family meeting and discuss your plan?

From a legal standpoint, a well-drafted estate plan should take care of important end of life issues such as long term care, medical decisions, and divisions of assets after death. What happens though, if you never share your estate plan with your loved ones? From an emotional standpoint, what often happens is that you add another layer of stress or confusion to an already emotional time for your loved ones. If you get sick, how does your family know who is supposed to be in charge of your financial matters, much less you if they have no idea what your estate plan says?

The point here is that once you have taken the time to create an estate plan, consider sitting down with your spouse, children, or both and discuss the plan. You may wish to do so with your estate planning attorney in case there are legal questions that arise. By doing this, everyone knows what to expect, where documents are located, and what your wishes are when the time comes.

The Law Offices of Barton P. Levine is a member of the American Academy of Estate Planning Attorneys.