Misconceptions Regarding Wills

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Elliot S. Schlissel is a member of the National Academy of Elder Law Attorneys.  Elliot and his attorneys have more than 100 years of combined legal experience handling all aspects of estate planning and estate litigation.  Please call to schedule a consultation at 516-561-6645 or 718-350-2802 or send an email to schlissel.law@att.net.

Revoking a Will

wills and estates attorneyGerace brought a petition to probate a Will. The decedent’s mother in this case filed objections in this proceeding. She claimed the Will had been revoked 4 years after it had been executed. The decedent had written on the top of the Will “worked to revoke it.” Gerace claimed this was a revocation of the Will. Surrogate Louis Gigliotti sitting in Oneida County noted the Will was handwritten and on top of the Will was the handwritten notation referring to a “new” Will. Gerace took the position that he was the decedent’s attorney from 1995 until her death. He saw her at least twice annually, but at no time did she indicate she wanted to make a new Will or revoke the prior Will.

The second issue presented to the court was did the decedent’s actions cause the cancellation of the Will. The court took into consideration there was no burning, tearing, cutting or mutilation of the Will. Judge Gigliotti took the position that in the event the words on top of the Will were written by the decedent, those handwritten notes on the Will did not act to revoke the Will. Surrogate Gigliotti stated that for the decedent to have written a new Will or modified the old Will, the new Will or the Will modifications would need to be done with the appropriate testamentary formalities. Since the testamentary formalities were not undertaken in this case, the decedent’s actions did not cause the revocation of the prior Will and the Will should be admitted to be probated.

Conclusion

Should you wish to withdraw or modify or revoke a Will, hire an attorney to take the appropriate action to write a new Will and cause the revocation of the prior will. New York State requires testamentary formalities with regard to the execution and/or revocation of Wills and those testamentary formalities must be correctly adhered to.wills attorney in New York

Ex-Wife Not Entitled to Life Insurance Proceeds of Deceased Former Husband

estate lawyer in New YorkIn a case in Erie County, New York, before Surrogate Barbara Howe, an estate sought to have the decedent’s ex-wife turn over the life insurance proceeds to the estate which she had received as a result of decedent’s death. In this case, the decedent left his entire estate to one of his sisters. She brought an application to the Surrogate’s Court to force the ex-wife, to turn over to the estate all of the funds she received as the beneficiary of the decedent’s life insurance policies. The ex-wife, through her attorneys, claimed she was entitled to the benefits as the decedent made an affirmative choice not to remove her as the beneficiary.

The decedent’s sister asserted that the ex-wife’s legal basis to receive the life insurance proceeds was terminated upon entry of a judgement of divorce in the County Clerk’s office. The court referred to Section 5-1.4 of the Estate, Powers and Trusts Law and the legislative history with regard to the enactment of this section of the EPTL. Surrogate Barbara Howe found that for an ex-wife to inherit she must prove the decedent took affirmative action after the divorce to ensure the ex-spouse would retain her status as the beneficiary on the pre-divorce life insurance policy. In this case, the decedent did not do so. Therefore the pre-divorce beneficiary designation was ruled a nullity. Judge Howe in her decision went on to state the ex-wife did not meet the standard under EPTL 5-1.4 with regard to the ex-spouse taking action after the divorce to reinstate her as the beneficiary. Judge Howe found the ex-wife had been bought out of the life insurance policy during the divorce case and she no longer had any marital interest in the life insurance policy. The policy was decedent’s separate property. Surrogate Howe ordered the ex-wife to repay the estate the full amount of the life insurance proceeds she had received.

Conclusion

To be safe, if you are getting divorced, remove your ex-spouse as beneficiary on all financial documents, deeds, bank accounts, securities accounts and all other financial instruments of every type and nature.estate planning attorney on Long Island

Divorce’s Impact on Wills and Other Testamentary Devices

Let’s say you get divorced but you don’t modify your will or change your bank accounts. What happens at the time of your death if your ex-wife is the beneficiary of your will and other assets are held jointly with your ex-wife?

New York State Law

Under New York State Estate Powers and Trusts Law Section 5-1.4, unless a will expressly states otherwise, divorce, judicial separation or annulment of a marriage revokes all dispositions or appointments of property made by the divorced spouse to a former spouse. Your former spouse would be treated as if he or she died before you. This means that any clause which would have named your former spouse as a beneficiary under you Will is revoked.

In addition, if you are divorced, your ex-spouse also loses his or her rights to inherit from your bank accounts, life insurance policies, revokable trusts, and real estate interests involving joint tenancies.

Housekeeping Needed After Your Divorce

If you get divorced, it is important to go through all of your financial documents and records. Your ex-spouse’s name should be removed from being a beneficiary on your life insurance. You should also notify your health insurance carrier that he or she is no longer married to you. In addition, you should remove your spouse’s name from your bank accounts, securities accounts, and financial accounts of every type and nature. If you have a Will, you should meet with the attorney who drafted the Will and draft a new Will.

Between the attorneys fees involved in the divorce, the child support, spousal maintenance, and division of assets pursuant to the terms of the divorce, your net worth will be diminished. You should carefully review all of your financial assets to make sure that upon your death, your ex-wife will not be in a position to seek to try to inherit and possibly cause litigation. Even though if you don’t disinherit her, the statutes in New York cause her to be disinherited, it is still better to change the documents to avoid the potential complications and legal expenses.estate planning attorney

Wills Litigation

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Elliot S. Schlissel is a member of the National Academy of Elder Law Attorneys.  Elliot and his attorneys have more than 100 years of combined legal experience handling all aspects of estate planning and estate litigation.  Please call to schedule a consultation at 516-561-6645 or 718-350-2802 or send an email to schlissel.law@att.net.

Medicaid and IRA’s

long island estate planning attorneyIf you have an Individual Retirement Account (“IRA”) and you are applying for Medicaid there are certain rules and circumstances which affect your IRA. Your IRA cannot be transferred if you are married. The only way to transfer an IRA between a husband and a wife is to have them enter into a separation agreement or get divorced. If you are in an institution and Medicaid is paying for your care, your spouse is entitled to the monthly maintenance needs allowance. The monthly maintenance needs allowance is currently $2,980.50 per month. This is the total you can receive from Social Security and from the IRA or other sources of assets which are in your spouse’s name. It should be noted the funds you receive from an IRA are pre-taxed assets and federal and state income taxes may need to be paid with regard to the funds distributed.

If you have an IRA custodian account you should request your custodian withhold taxes from payments and therefore your spouse can receive the entire $2,980.50 and not have any taxes removed from these funds. The $2,980.50 stipend used for your spouse’s expenses in New York State is the highest in the United States. Unfortunately, this may not be sufficient to live on in the State of New York. A legal proceeding can be brought to obtain a larger allowance, but this is difficult to be successful in these proceedings. The fact that the standard of living in New York State is high is not a valid reason for obtaining a higher monthly stipend.

Conclusion

It may be necessary for Medicaid to pay expenses for you or your spouse, either for private nursing care at your residence or in a nursing home facility. You should meet with an elder care attorney early on and develop a plan to help you qualify for Medicaid should you need it to pay your expenses for nursing home care.estate planning attorney

Handling An Estate in a Nutshell

estate administration attorneyAll human beings that live will eventually die.  When a loved one passes, dealing with his or her estate is not a task most people look forward to.  However, most people will, during the course of their lifetime, be involved with estate issues concerning a loved one.

When the grief passes, the issues involved are who are the heirs of the estate, what are the assets, how are they distributed, and what creditors need to be paid, become issues in the decedent’s estate.  If the individual dies with a Will, the process to validate the Will by the Court is called PROBATE.  If an individual dies without a Will, the process of determining who will inherit from his or her estate is called ADMINISTRATION.  If there is a Will, the Will will appoint an executor.  It will be the executor’s responsibility to hire an estates lawyer and to take the appropriate legal action regarding the estate.  If there is no Will, an individual who is next of kin to the decedent can ask to be appointed the administrator of the decedent’s estate.

Legal Work in the Estate

If you hire an attorney, he or she will draft a probate petition or a petition for the administration of the estate.  The petition will thereafter be filed in the Surrogate’s Court in the County in which the decedent was a resident of at the time of his or her death.

After the probate petition or administration petition is filed, next of kin and potential beneficiaries will be notified of a court date.  On that court date, any individual seeking to challenge either the appointment of the administrator in an administration proceeding, or the executor in a Will in a probate proceeding can appear in Court and advise the judge that he or she seeks to challenge the estate proceeding.

Executor’s and Administrator’s Duties

When the Will is accepted for probate, the executor or administrator’s duties are to find the assets, liquidate them, and obtain them for the benefit of the beneficiaries.  The technical aspects of handling the funds is usually dealt with by the attorney retained by the administrator or executor of the estate.  Assets of an estate can involve houses, money, stocks and bonds, insurance policies, jewelry, artwork, clothing and other personal items.

Real Estate Issues in Estates

If an individual owns real property outside of New York State (houses, land and other structures on land), an ancillary probate proceeding will be required to be undertaken in the State where the real estate is located.  Surrogate’s Courts in the State of New York only have jurisdiction over real property that lies within New York State.

Accounting of Assets Before Distribution to Beneficiaries

After all of the assets are amassed by the estate, and all of the creditors are paid, the administrator or executor thereafter needs to provide a simple accounting to the beneficiaries showing assets, liabilities and the amount which will be available to be distributed to the beneficiaries.

Fiduciary Responsibility

It should be noted an executor is a fiduciary.  In the event he or she makes mistakes or mishandles funds, they are personally liable to the beneficiaries of the estate for these actions.  It is therefore almost always advisable for the executor or administrator to hire an experienced estates attorney to assist him or her with regard to all aspects of the decedent’s estate.estate litigation lawyer

What is Needed During a Probate Proceeding?

estate litigation lawyerA probate proceeding is a proceeding brought to see to it that a Will is accepted as being valid by the Surrogate Court in New York State. The best way to start a probate proceeding is to visit several attorneys and hire an experienced, dedicated estate lawyer. Make sure when you hire this lawyer, that he or she has been doing this for a minimum of ten years and has handled numerous estate matters.

There are a variety of documents which are necessary to assist the attorney in bringing the probate proceeding. The following are a list of some of these items:

  • The original Will. The original Will, not a photocopy of the original Will, should be brought to your attorney’s office.
  • Your attorney will need several original raised seal death certificates. It is suggested, depending on the size of the estate, that you receive a minimum of six, and if there are a number of different bank accounts or securities accounts involved, twelve original death certificates may be helpful.
  • You need to bring with you, when you go to your attorney’s office, a copy of a funeral bill indicating it is paid. Funeral directors have a very strong lobbying group in Albany, and estates cannot be processed unless you show the funeral bill has been paid.
  • You need to provide the attorney with the names and addresses of all of the individuals who are next of kin as well as all the individuals named as beneficiaries in the will.
  • In the event there are minor children involved, the attorney will need to know their names, addresses, dates of birth, social security numbers and the names and addresses of their legal guardians.
  • If you are familiar with the assets of the decedent it is very important you provide the attorney with an itemized list documenting each and every one of the assets the decedent died owning.

If you provide the attorney you hire with all of the necessary information and documents, the estate proceeding will move forward without problems. This can also reduce your legal expenses and the time it takes for the Will to be probated.

It should be noted that once a Will is probated, distribution of the assets is not supposed to take place for a period of seven months. This gives creditors a reasonable period of time to file claims against the estate.wills and estates attorney

How Do I Avoid Probate?

estate planning lawyerIn some states, the probate process can be long and expensive. Wills, when they are probated, are public documents and anyone can go to the courthouse and view the Will. While there is a valid reason for drafting a Will and having it probated, in some cases this may not be the very best way to handle the transfer of assets from one generation to the next. This is especially true when the individuals involved are of modest means and do not have significant amounts of property. The following are several examples of devices which can be used to avoid the necessity of probate.

Joint Ownership of Property

When two individuals own property, and they want the survivor of the two to become the sole owner of the property they enter into a type of deed which specifically has the right of survivorship. In New York State a deed which allows for the survivor to inherit the property is called a joint tenancy with right of survivorship, or a tenancy by the entirety for married individuals. This type of deed causes the property upon the death of the first one to die to automatically vest title to the entire parcel of property in the other individual’s name.

Gifts

Simply speaking, if you gift your assets to others during the course of your lifetime you will have no property to be inherited at the time of your death. There are various Internal Revenue Service rules concerning the gifting of property. As of the writing of this article an individual can gift up to $5,430,000 (a married couple can give $10,860,000 specifically $5,430,000 for both the husband and wife) during the course of his or her lifetime without it creating a Federal taxable event. The amount an individual can give to others during his or her lifetime goes up each and every year based on a formula which deals with inflation. In addition, an individual can, each and every year, give the sum of $14,000 to each recipient in each calendar year. Couples who are married, therefore, can give up to $28,000 to individuals in each and every calendar year.

If a family friend or loved one has medical bills, you can offer to pay for the medical treatment and there is no limit under the Internal Revenue Code as to payments of this nature to help out a friend or loved one.

Living Trusts

A living trust is a testamentary vehicle which will allow an individual to avoid having a will which needs to be probated. In theory, the individual puts his assets in the name of the living trust and therefore these assets are removed from the individual’s estate. When living trusts are created it is necessary to have a pour over will drafted so any assets which are not included in the trust will be poured back into the trust at the time of the individual’s death.

Pay on Death Accounts

If you have maintained money in banks or other financial institutions, you can designate that upon your death all of the assets in the account be paid over to an individual of your choice. When you pass, the individual named on the account needs to provide a valid, original death certificate to prove your death and thereafter all of the funds in the account would be paid over to him or her.

Conclusion

The best way to avoid probate is to meet with a qualified estate planning attorney and work out an estate plan which meets your family’s needs.wills and trusts lawyer

Long Term Health Care Plans

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Elliot S. Schlissel has more than 35 years experience representing clients in all aspects of estate and long term care planning.  He and his associates are available for consultation at 516-561-6645, 718-350-2802 or by sending an email to schlissel.law@att.net.