Wills, Trusts, and Estates
It is never too early to begin the estate planning process. The most common reasons given for estate planning include management and protection of assets during a lifetime, and distribution of estate assets after death.
An unplanned estate rarely conforms to the wishes of an individual and, as a result, can have undesirable consequences. Every estate is unique; therefore, to effectively meet your planning needs, a carefully crafted estate plan should always be favored over a one-size-fits-all approach.
Creating a will ensures that your estate will be distributed in accordance with your wishes. In the absence of a properly executed will, distribution of assets is governed by Article 4 of the New York Estates, Powers and Trusts Law ("EPTL"), which lists the order and amount that family members will take from the estate of the decedent. The goal of Article 4 is to carry out the probable intent of the average person; however, in many circumstances, Article 4 often fails to fully recognize a person's true wishes. Preparing a will avoids this situation.
The substantive law of wills is governed by Article 3 of EPTL. Pursuant to Article 3, any person eighteen years of age or over, of sound mind and memory, may dispose of his or her assets by will and exercise a power to appoint such property. A will must be in writing, executed, and attested in accordance to the formalities outlined in EPTL § 3-2.1.
Finally, based on the size of your estate, tax planning may be necessary in order to adequately address future state and federal estate tax obligations.
A trust is a fiduciary relationship where a trustee manages assets for the benefit of one or more named beneficiaries. A valid trust must contain specific assets. Real property, personal property, money, intangibles, or future interests will suffice, however, a mere expectancy will not. A trust may be created for any purpose that is not illegal or contrary to public policy.
Trustee. A trustee holds the legal title to the trust property. A trustee must be able to acquire and hold property for his own benefit and possess the capacity to administer a trust.
Beneficiary. Any individual or entity can be named as a beneficiary, as long as the individual or entity is capable of taking and holding equitable title to property.
Revocable Trust. A revocable trust (also referred to as a living or lifetime trust) allows for the management of trust assets during the creator's life, as well as distribution of assets upon the creator's death. A revocable trust can be terminated by its creator at any time. New York law presumes that a trust is irrevocable and not amendable, unless otherwise stated in the creating instrument. EPTL § 7-1.16.
Benefits of creating a revocable trust include:
- Asset Management. Over time, management of securities or other assets by older individuals can be a burden.
- Avoidance of Probate
- Immediate Asset Distribution
Irrevocable Trust. Unless the trust "expressly provides that it is revocable," it is irrevocable. EPTL § 7-1.16. A trust that is not expressly revocable may be revoked or amended only with the written consent of the settlor and all persons beneficially interested in the trust.
Testamentary Trust. Testamentary trusts occur when the terms of the trust are contained in writing in a will or in a document incorporated by reference into a will.
Durable Health Care Powers and Powers of Attorney
Healthcare Proxies. New York recognizes healthcare proxies, which allow the appointment of an agent to make healthcare decisions for a principal in the event the principal cannot make the decision competently. N.Y. Pub. Health Law § 2981.
Health care proxies must be in writing, name the principal and agent, be signed and dated by the principal or another at his or her direction, and be witnessed by two adults (the designated agent may not act as a witness).
A principal may revoke a health care proxy by notifying the agent or health care provider orally or in writing, or by taking an action that evidences a specific intent to revoke the proxy. The execution of a subsequent health care proxy will revoke a prior proxy.
Power of Attorney. A power of attorney permits another person (an agent) to complete financial transactions on a principal's behalf. There are two types of power of attorney in New York: durable and nondurable. A durable power of attorney survives the principal's incapacity, while a nondurable power of attorney ceases at the principal's incapacity. A power of attorney is presumed durable unless it expressly provides that it is terminated by the principal's incapacity. N.Y. GOB. Law § 5-150A.
Request a Consultation
To schedule a consultation to discuss your estate planning matter, please call or email the office. Once you schedule your consultation, you will be provided with a list of documents to submit prior to the consultation.