Estate Planning for Dummies – The Important Steps You May Have Already Taken

Estate Planning for Dummies explains the most basic estate planning tools, many of which you may have already implemented without even knowing it.

Estate planning for dummies is a misnomer.  Because the premise of this article is that you may have sufficient estate planning in place, you are clearly not dummies.  But understanding how to make the most of your estate plan, will ensure that you and your family are protected in case the unforeseen occurs.

Do I need a Will?”  This is usually the first question asked by clients.  The short answer is yes and, to better understand why, it is important to know the protections that a Will provides.  A Last Will and Testament is the cornerstone to a comprehensive estate plan.  Whether you have children or not you do have assets.  Depending on their size, more complex planning may be required.  But the key to knowing whether you have unwittingly begun work on your estate plan, you must know what property passes under a planning basics

Probate Asset v. Non-Probate Assets

Wills cover probate assets, or assets held solely in your name. Examples include real property, bank accounts and personal belongings. Personal belongings are key because many people do not like the idea of a distant relative rooting through their most cherished items after death. Wills do not pass non-probate assets, or assets held jointly with someone else (like a bank account or real property held as a married couple or as joint tenants), assets held in trust for someone else or any asset that has a designated beneficiary, like an insurance policy, a 401(k) or an IRA retirement plan.

The goal of a good estate plan for a married couple is to maximize you non-probate asset designations.  If done correctly, there will be no need for a probate process upon the death of the first spouse.  Probate is the process by which the state of a decedent ensures that their Last Will and Testament was drafted and executed correctly, that the assets and debts of the decedent, the person who died, are identified, that the debts are paid and the assets are distributed according the decedent’s Will. The New York probate process governs the transfer of legal title of property from the estate of the person who has died to those named in that person’s Last Will and Testament.

If you are married and your home is listed in both spouses’ names, then the house will pass automatically to the surviving spouse with no need for probate.  Likewise, if you have joint bank accounts, the assets in those accounts pass outside of probate.

right of survivorship, JTWROS, joint tenantsMany city couples rent their apartments, making their most valuable assets their investment or retirement accounts.  For these investment vehicles, you may name your spouse, or partner if you are unmarried, as a designated beneficiary.  You may also name multiple designated beneficiaries as long as the percentage allocations are clear to the administrator of the investment/retirement account.

Estate planning for dummies = the maximization of non-probate asset designations.  It is the best tool you have to avoid probate.  And while this type of specific planning may allay the need for a Will, it is always a good idea to have a Will in place, even if you do not need to put that Will through probate.  If you are unmarried, it is of particular importance that you have a Will because the protections of marriage, which include naming the surviving spouse as the default beneficiary of a decedent’s assets, will not apply to you and your partner.

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Do I need a Will ? – Essential Estate Planning

Do I need a Will ? “I don’t own anything.”  “It’s too complicated.”  “I’m too young to think about a Will.”  I have heard all of these reasons and more for not adequately preparing an estate plan.

“Do I need a Will ?” is a very important question and this article will shed light on your Will’s importance and what happens if you don’t have one. While it may trigger unwanted emotions, having your “affairs” in order is the best gift you can give to your family and friends.

What happens if you do not have a Will? For the family and friends of those who have died without indicating their wishes for the disposition of their assets after death, not having a Last Will and Testament can be a nightmare.  State law determines where assets go when someone dies without a Will and the state doesn’t always get it right.  If you are married, your spouse receives your estate.  If you are married with children, most states direct half of your assets to your spouse and the other half to be divided among your children.  This may or may not be appropriate depending on an individual’s wishes and the ages of their planning trust, estate planning gay estate planning, lgbt estate planning, glbt estate planning, Wills, trusts, gay family law

If you do not have children, the state will look to your closest living legal relative as a recipient of your estate. This is where it gets tricky.  In most cases, a surviving parent is next in the line of succession, then siblings and their children.  If you do not have siblings, nieces or nephews, then the court will look out to your aunts, uncles and cousins.  The reality of this scenario is that someone who you may have never met, or had a relationship with may be the beneficiary of your estate if you do not plan carefully.

How does a Will work? A Last Will and Testament is the foundation for all Estate Plans and it passes only probate assets, or assets that are owned    in one person’s name without a designated beneficiary.  Examples of probate assets include land, homes, cars, personal belongings and bank accounts.  A Will does not cover non-probate assets.  A non-probate asset is something that is owned jointly or an asset with a designated beneficiary.  Examples of non-probate assets include jointly held real property, a joint bank account, a life insurance policy with a designated beneficiary and an IRA, 401(k) or other investment account with a designated beneficiary.  You may also name a “TOD” (transfer on death) designation for a bank account you own solely in your name.

The above described assets pass outside a Will, the benefit of which is a faster and easier transfer of someone’s money or property when they die. If, however, you are single and there is no appropriate person to name as a designated beneficiary, it is imperative that you have a Will to pass your property where you want it to go upon your death.

What else does a Will do? A Last Will and Testament, in most states, is the only document that will allow you to name a guardian for children if something happens to both legal parents.  If you have young children, it is critical that you have a Will to state who you want to care for them if anything were to happen to both parents.  A Will also allows you to name an executor.  An executor is the person who will be in charge of marshalling your assets, identifying your debts and ultimately paying them off and making a final distribution according to your wishes as written in the Will.  If you die without a Will, your closest living legal relative will be the first choice for an executor.  Only you know whether this would be appropriate or not.

What happens after I die? If you die with a Will, the executor named in your Will petitions the probate or surrogates court in the county where you lived to receive authorization letters from the court.  This process is called “probate” and it ensures that a Will has been drafted and executed correctly, as well as managing the asset distribution.  Authorization letters will allow you to set up a bank account in the estate’s name and start paying any bills that are due.  If an executor must spend their own money to start a probate proceeding, it will be reimbursed prior to any distribution of assets.

Each state is different and will have a different time line and fee structure, so it is imperative that you meet with an attorney in your area to discuss the process in detail. If you find yourself asking, “Do I need a Will ?,” now you know better how to answer that all important question.
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Estate Planning Trust – Does my family need one?

I get this question a lot, “Do I need an Estate planning trust?” The answer differs for every personal and family situation, but there are some critical reasons why an Estate Planning trust may be right for you.

Before understanding when an Estate Planning Trust is appropriate for you, it is important to understand exactly what they are. There are two types of Estate Planning Trusts, revocable and irrevocable, and two ways to create them, either in a Will, a testamentary trust, or as a standalone document.

Revocable Trusts – A revocable trust is executed during the lifetime of the Grantor, the person creating the trust, and is called an intervivos trust.  The Grantor often has controlling power over the assets in the trust during his or her lifetime.  Revocable trusts are tied to the social security number of the Grantor and provide the Grantor with specific control over the assets contained within the trust, including terminating the trust and transferring any trust assets back to the Grantor.  The most common reasons for revocable trusts are to bypass the probate process for passing assets upon the death of the Grantor and to provide for the management of assets that the Grantor may believe that they cannot manage due to planning , estate planning trust, glbt estate planning, lgbt estate planning, gay family law, wills, trusts

Irrevocable Trusts – An irrevocable trust may be created either during the life of the Grantor, an intervivos trust, or in the Grantor’s Last Will and Testament, a testamentary trust.  In the case of the latter, the trust becomes irrevocable upon the death of the Grantor.  The key difference between a revocable trust and an irrevocable trust is that the Grantor completely surrenders control over any assets contained in an irrevocable trust.  Irrevocable trusts also require separate tax ID numbers, and have separate tax filing requirements.  Reasons for creating an irrevocable trust include minimizing estate tax charges on assets passing to non-spousal beneficiaries, such as homes (Qualified Personal Residence Trusts – QPRTs) and life insurance proceeds (Irrevocable Life Insurance Trusts – ILITs).  The values of assets which pass through irrevocable trusts are not taxable in the Grantor’s estate; however, there may be a gift tax event which occurs at the time of the initial transfer of an asset into an irrevocable trust.

Other Reasons for an Estate Planning Trust – For Grantors who own real property in a state other than the state of their domicile, a proceeding called an “ancillary probate” is required.  This means that if a person lives in New York and owns real property in Florida, two probate proceedings must be brought: one in New York to pass their New York property and one in Florida to pass the Florida real property.  In order to avoid this unnecessary and expensive double probate process, the title to real property in Florida may be transferred into a New York revocable trust.  This transfer then negates the need for the Florida probate proceeding.  It is critical; however, to actually transfer the title of the Florida property into the New York trust and have that newly transferred title recorded in the appropriate Florida County Clerk’s office.  Simply creating the trust is not enough.

Children’s Trusts – The primary reason why people include an Estate Planning Trust in their Wills, a testamentary trust, is to provide for young children in case something were to happen to both parents before he children reach an age where they can responsibly manage their money.  Children’s trusts allow parents to name a trustee, or money manager, for the assets which will eventually pass to their children, to provide for unexpected circumstances such as drug or alcohol abuse of a child and to stretch out distributions of principal and interest over a controlled period of time.  It is important to note that a Children’s trust cannot name a guardian for the person of the child, only for the property of the child.  This personal guardianship designation can only be made in a Last Will and Testament.

If I have an Estate Planning trust, do I still need a Will? – In a word, yes!  The Estate Planning Trust should be an addition to a person’s estate plan, not a substitution for it.  To see a list of estate planning basics which all individuals and couples, with or without children, should have, visit

When you are considering an Estate Planning Trust, please consider me a resource. For more information the basics for estate planning for gay couples, contact Anthony M. Brown at Time for Families and speak to a specialist family lawyer to secure your and your family’s future.

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Tips For Estate Planning – Inside Information

Tips for estate planning can come from many people and places. The most important thing that you probably won’t hear is that you may have already done a substantial amount of estate planning without even knowing it.

The best tips for estate planning that I can offer involve a little basic education first. Most people, when they hear the term, “estate planning,” they think of Wills and, in some cases, trusts.  While Wills are a necessity and a Trust can be helpful in certain circumstances, you can take critical steps to protect your family without even having a Will or Trust.

Estate Planning For Same Sex Couples

Probate Assets

To understand this, you must understand what a Last Will and Testament does. A Will passes probate assets to your beneficiaries, the people you choose to receive them.  A probate asset is anything that is owned solely by an individual.  Examples of probate assets include your personal property and furnishings, bank accounts held solely in your name or a car, house or apartment titled solely in your name alone.

Non-Probate Assets

Wills do not cover, or pass, non-probate assets.  These assets pass outside a Will and, usually, are transferred to specified recipients much faster than if they would if transferred by a Will.  Examples of non-probate assets include accounts or policies with designated beneficiaries, like life insurance or joint bank accounts.  They also include property titled as joint tenants with rights of survivorship or tenancy by the entirety (how married couples jointly own property.)  Real property owned as joint tenants with rights of survivorship or tenancy by the entirety automatically passes to the joint owner upon the death of the first to die.

If you are in a long term relationship and have an IRA, a 401(k) or 403(b) account, a brokerage account, a joint bank account and you own your home or apartment jointly with your spouse or partner, then there is relatively little that would be considered a “probate” asset, therefore, very little need for the probate process.  Just make sure that you have named your spouse or partner as the primary designated beneficiary and you are good to go.  You can also name a secondary beneficiary on these accounts.

What is Probate?

While the specific process differs state by state, probate is the process that transfers legal title of property from the estate of the person who has died to those named in that person’s Last Will and Testament under the supervision of the local surrogates or probate court. If the person who has died has successfully minimized their inventory of probate assets, then there may be nothing which would require a probate court’s intervention.  This is successful estate planning.

Wills and Trust

It is always wise to have a Will, even if you have maximized your non-probate assets. Wills ensure that nothing falls between the cracks and, if your probate estate is under a certain amount, for example – in New York, a small estate proceeding can be accomplished if probate assets are valued at less than $30,000.00 – then you may be able to avoid a full probate proceeding.  If you have children that are minors, you should consider creating a Will with a testamentary trust (a trust that does not come into existence unless you, or you and your spouse or partner both die).  This trust allows you to control the way money is distributed to a minor and by whom.  Trusts are also advisable for people who own property in states other than those in which they reside.  This will help to avoid costly and redundant probate proceedings.  Click here for more information about what documents constitute a complete estate plan.

For more information on tips for estate planning for same sex couples, contact Anthony M. Brown at Time for Families and speak to a specialist family lawyer to secure your and your family’s future.  Click here to read more about estate planning for same sex couples.

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