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.

Do I Pay Taxes on a Gift Someone Left Me in a Will?

Jan 17, 2014  /  By: Barton P. Levine, Esq.  /  Category: Wills

Receiving a gift in someone’s Last Will and Testament often causes conflicting emotions. The gift itself may be appreciated, even needed; however, the reason for the gift is certainly not cause for celebration. One practical question that beneficiaries often have when they receive an inheritance is “Do I pay taxes on a gift someone left me in a Will?” As a general rule the answer to that question is “no”.

The Internal Revenue Service Code requires a tax to be paid on most gifts that are made. According to the IRS rules, almost anything you gift to someone is subject to the gift tax. For the average taxpayer, however, a tax will never actually be due because of the lifetime exemption for gift and estate taxes and/or the annual exclusion. When you die, your estate assets will be valued. The total value of your estate will then be added to the total value of all countable gifts made during your lifetime. If the total of the two exceeds the lifetime exemption limit (set at $5 million and adjusted annually for inflation making it $5.34 million for 2014) your estate will owe gift and estate taxes. This is how any tax due is paid on a gift. Therefore, if you are left a gift in someone’s Will, the estate of the person who left you the gift will pay any applicable tax on the gift. The same is true for any state gift tax that might be due on the gift – the donor’s estate will be responsible for paying the tax. Under certain circumstances, the recipient of a gift may agree to pay any taxes due on the gift; however that exception to the general rule would not apply to a gift left in a Will.

Although you will not be responsible for paying taxes on a gift at the time you receive the gift you could end up paying taxes on the gift down the road in the form of capital gains taxes. As the recipient of a gift you will also receive the donor’s basis in the property. The basis is typically what the donor paid for the asset. This could result in a considerable capital gains tax down the road. If, for example, you are gifted a house that the donor paid $50,000 for 30 years ago and is now worth $400,000 you would owe capital gains tax on $350,000 if you were to sell the home.

 

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

How Is My Property Transferred If I Die Intestate in New York?

Aug 28, 2013  /  By: Barton P. Levine, Esq.  /  Category: Wills

If you have taken the time to execute a Last Will and Testament prior to your death then you are said to have died testate. If you die without executing a Last Will and Testament then you are said to have died intestate. The intestate succession laws of the State of New York will determine what happens to your estate assets if you die intestate.

Each individual state decides how property will be handled when a decedent dies intestate. Although intestate succession laws are often similar among the states, there are also important differences. Understanding the intestate succession laws of the state you live is important if you do not plan to leave behind a Will.

If you die intestate, your estate will need to go through probate to determine who the legal heirs of your estate are. Legal heirs are typically your spouse, children, parents and other more distant blood relatives. Once your legal heirs have been determined, the court will distribute your estate assets according to the New York State intestate succession laws. The most common distribution scenarios are as follows:

  • Spouse and no children or other descendants – spouse inherits all of the estate
  • Children but no spouse – children inherit all of the estate assets
  • Spouse and children/descendants – spouse will inherit the first $50,000 out of your estate assets and is then entitled to one half of the remaining assets with descendants getting the remaining half.
  • Parent with no spouse or descendants – parent(s) inherit all estate assets
  • Siblings but no spouse, parents or descendants – siblings inherit all estate assets

In the event that you did not leave behind a spouse, children (or their descendants), parents, or siblings, the distribution of your estate assets get a bit more complicated. The law looks to grandparents and the descendants of your grandparents in that case to divide your estate property.

As you may have noticed, friends, co-workers, charities and more distant relatives are not among the list of people who will inherit from your intestate estate. This means if you have a special collection that you planned to give to your best friend, he or she will not be entitled to it when you die. Likewise, if giving to a charity that is close to your heart has been important during your lifetime, that charity will receiving nothing when you die from your estate.

In essence, you give up complete control over your estate assets by failing to create an estate plan prior to your death. Although the laws of the State of New York to cover intestate estates, the way those laws distribute your estate assets may not be the way you would have distributed them.

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

Tips for Choosing Your Child’s Guardian

Jun 10, 2013  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning, Wills

Your Last Will and Testament allows you to do much more than just decide who will receive which assets when you die. In fact, for people with minor children, probably the most important decision you make in your estate plan is included in your Will – the appointment of a guardian for your child. Because this person will be responsible for raising your child should the need arise, consider the following tips before making a final decision about who to appoint:

  1. Location – the older your child is, the more important it may be to choose a guardian who lives close if possible. Taking a teenager away from his or her friends and school right after losing a parent can have disastrous results.
  2. Familiarity – appointing your cousin who lives 1000 miles away and whom your child has spent little, or no, time with may not be the best choice even if you have complete confidence in him or her.
  3. Capacity – does your potential guardian have the emotional, physical and financial capacity to do the job? Is he or she mature enough and stable enough to handle becoming a parent?
  4. Willingness – being capable is not the same as being willing. Never assume that someone will take the job either – always sit down and discuss your choice at length with a potential guardian before making a final decision.
  5. Style – does your choice have the same parenting philosophies that you have? While not completely necessary, it will likely help your child adjust if your guardian has a similar parenting style to yours.

 

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

Taking Against a Will

Mar 23, 2013  /  By: Barton P. Levine, Esq.  /  Category: Wills

Most of us assume that once we execute a Last Will and Testament that the document controls everything relating to the disposal of estate property after death. While your Will certainly is the foundation of an estate plan, there are situations in which a Will does not tell the entire story. Taking against a Will is one of those examples.

Individual state laws govern wills and trusts. For that reason, the state in which a decedent is considered a resident at the time of death will determine any legal issues relating to the estate of the decedent. Most states have a law that allows a surviving spouse to “take against the Will”. What this means is that a spouse may elect to take a specific dollar amount or percent of the estate instead of accepting whatever was left to him or her in the Will. If, for example, your spouse left you $10,000 under the terms of his or her Will, but the laws in the state where you live allow you to take $25,000 as a surviving spouse then you would be better off taking against the Will.

Whether you are a surviving spouse or are someone who is in the process of drafting a Will, you should understand your state’s laws with regard to a spouse’s right to take against a Will. As a testator, you need to understand what rights your surviving spouse will have with regard to your estate. On the other hand, if you are the surviving spouse then you may be entitled to more estate assets than the Will left you.

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

The Cost of Challenging a Will

Mar 21, 2013  /  By: Barton P. Levine, Esq.  /  Category: Wills

If you are like most people, you have heard over and over again why you should not use a “do-it-yourself” Last Will and Testament, yet you may still be considering it. Once you consider the cost of challenging a Will you may finally be convinced that professional advice is warranted when you execute a Will.

A Will contest can be filed for a number of reasons, but the bottom line is that they must claim that the Will itself is invalid. If the probate court is satisfied that the challenge is not frivolous, it will be litigated. The emotional cost to the family members and loved ones who must go through this process is immeasurable. The financial cost, however, can be measured.

While each Will challenge is unique, they all incur costs. The executor or personal representative of the estate must defend the Will. This requires an attorney. The attorney must prepare a response to the challenge and file that with the court. Discovery will then take place which will include reviewing and analyzing numerous documents, medical records and evidence. Depositions of people involved with case may be scheduled. Hearings will be held along the way. All of these steps along the way incur legal fees that are charged to your estate assets. By the time all is said and done, the cost of litigating a Will challenge will almost always far exceed what it would have cost to simply consult with an estate planning attorney in the first place.

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

What Does Testamentary Capacity Mean?

Mar 13, 2013  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning, Wills

Estate planning attorneys and courts often talk about testamentary capacity. The most common reference to testamentary capacity is when someone is challenging a Last Will and Testament under the grounds that the testator did not have the testamentary capacity to execute the Will. So what does this term really mean and why is it important?

State laws define estate planning terms and concepts; however, there are usually similarities among the states. As a general rule, “testamentary capacity” refers to an individual’s mental capacity to sign a document such as a Last Will and Testament. Despite how many books and movies portray the concept, testamentary capacity usually has a relatively low standard.

In most cases, the capacity required to execute a Wills is presumed, meaning that anyone challenging the Will must prove that the testator lacked the legal capacity required. In addition, it is typically only necessary that the testator had the capacity at the precise moment that the Will was signed. If the testator doesn’t remember signing the document the following say, he or she way still have had the capacity at the time of signing under the eyes of the law.

While full blown dementia or Alzheimer’s may be enough to find that the testator lacked the requisite capacity,  early stage symptoms of either may not. For this reason, if you are considering contesting a Will based on the lack of testamentary capacity, be sure to consult with an experienced estate planning attorney first.

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

The Importance of Language in your Estate Plan

Feb 20, 2013  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning, Wills

Most people who do not happen to work in the legal profession tend to feel that reading legal documents is often akin to reading something written in a foreign language. Even attorneys have to agree that they have a point.

Legal “jargon” can seem superfluous (a perfect example of legal jargon) to anyone outside of the legal profession. Along with including words and terms that seem unnecessary, it may seem as though your attorney is being difficult when he or she insists on using specific words or including the same information over and over again in your estate plan. There are, however, reasons for using all this jargon and repetitive information because language is everything in your estate plan.

In the United States, we use a legal system that has developed over centuries. One case sets a precedent and then the cases that come after it build on that precedent. Other cases may try and distinguish themselves from the original precedent by focusing on the differences between the cases.

In essence, language is important in the law. Therefore, the reason your estate planning attorney insists on using specific language is because he or she knows that language will accomplish your goals.

A perfect example in estate planning is the use of the word “heirs” or “beneficiaries.” Although people often use them interchangeably, in the eyes of the law they mean two very different things. Your beneficiaries are the people you specifically mention and gift things to in your estate plan. Your heirs, on the other hand, are the people who would legally inherit from you if you died intestate, or without executing a Last Will and Testament.

Because language is so critical in your estate plan, be sure you confer with an experienced estate planning attorney to ensure that your intentions are properly conveyed in your estate plan.

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

Reasons All Parents Need Emergency Planning

Jan 20, 2013  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning, Wills

When you think of estate planning you typically think of what happens after you die, but one thing you might not have thought about is what happens during an emergency? If you have kids, elderly parents or other forms of dependents that you are responsible for you need to create a plan for what will happen to them during an emergency situation.

Sample Situations to Consider:

  • Something occurs to an elderly parent while you are on vacation. Who can take care of them while you are gone?
  • You are hospitalized in a car accident, but who will watch your children while you are away?
  • You or your spouse is fatally injured in an accident, but the Will is nowhere to be found. Where do police or other authorities take your children?

Your Will is Not Enough

Though there is a guardian listed in your Will, that individual cannot oversee your children until a court judge approves it. This could take weeks or even months, which means your children could be sent to protective services until the matter is hashed out in the courts – especially if there is a dispute between interested parties. By creating a Temporary or Emergency Proxy Guardianship, your children will be spared the hassle of going to a group home or other protective custody house and be given to guardians that you have appointed while the court hashes out the details of your Will.

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

Will Contests and Statutes of Limitations

Apr 24, 2012  /  By: Barton P. Levine, Esq.  /  Category: Estate Planning, Wills

Oftentimes, prospective clients will contact our office and ask us how to proceed in contesting a Will. They may want to challenge the validity of their spouse’s Will or another loved one’s Will. You may believe that you have an unlimited time to contest someone’s Will, but that is untrue and you may lose your legal right to challenge the validity of a Will if you believe such. If you want to disclaim your inheritance as a spouse in favor of an elective or forced share, you may lose your right to do so if you wait too long.

The statute of limitations is a legal doctrine that gives you a certain number of days, months, or years to assert a legal claim. If you wait too long, you may be time-barred from asserting a legal claim or defense. For example, if you wanted to contest a written contract, your state’s statute of limitations to sue someone for breaching a written contract may be three years. After three years, you would not be able to sue for breach of a written contract. Similarly, each state has a limitations period setting the time limits for plaintiffs to challenge a decedent’s will. In some states, you may have only a few months, while in others, you have a few years. Make sure you speak with an estate planning lawyer regarding the statute of limitations applicable in your state for challenging a Will.

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