Will, Trust and Estates

Q. What does it mean to "probate" a will?
A. It means that a court (in New York State, the Surrogate's Court) has decreed that a particular document is the last will of a competent testator (the signer of the will), and that it was executed in the manner required by law.

Q. What does dying "intestate" mean?
A. It means that an individual has died without a will.

Q. Can probate be avoided?
A. Yes, if all of your assets are:

  • jointly owned with survivorship rights vested in the co-owner 
  • payable on death to a named beneficiary.

Q. Are the proceeds of my life insurance policies taxable?
A. They are not income taxable, but they may be subject to estate or inheritance taxes unless all ownership rights are surrendered during your lifetime.

Q. If my property is jointly owned, will it be exempt from estate tax?
A. Generally speaking, no, unless there are no survivorship rights between the co-owners, and then only your percentage share will be taxed.

Q. If I die without a will, what happens to my property?
A. Your property will be distributed among those heirs established by the law at the time of your death, regardless of whether you wanted all or any of them to receive assets. If you have no heirs, your property will pass to the state.

Q. Even if I draw a will, can I leave my property to anyone I choose?
A. Yes, as a general rule, except that a husband or a wife cannot be completely disinherited. A certain percentage of your estate - although not all - must be left to your spouse.

Q. Can my spouse be completely disinherited under any circumstances?
A. Yes, if there is a divorce, or if there is a written agreement whereby your spouse waives his or her inheritance rights in your estate.

Q. Are there any particular requirements for me to make a will?
A. The basic requirements are that you be 18 or older, and of sound mind and memory.

Q. Should my will be notarized?
A. No. It should be signed by you in the presence of two witnesses, who must then sign, as witnesses, in your presence.

Q. Is it possible for me to save estate taxes and other expenses simply by executing a will?
A. Yes.

Q. What is a codicil?
A. It's a document - executed in the same way that you executed your will - which in some way modifies your will.

Q. Can anyone contest my will when it's offered for probate?
A. No, unless that person would stand to benefit financially from the setting aside of your will. Generally speaking, only your distributees (your heirs) or a beneficiary named in an earlier will would have standing to contest.

Q. What's the difference between an executor and an administrator?
A. An executor is a fiduciary chosen and named by you in your will to collect and distribute your assets. An administrator is the fiduciary named by the Surrogate's Court when you die without a will. The functions of an administrator, broadly speaking, are the same as an executor.

Q. Are executors and administrators compensated for their services?
A. Yes, they receive commissions in percentage amounts set by statute.

Q. How will my estate be distributed if I die without a will?
A. Percentages will be allocated between your spouse and children. If you have no children, your spouse gets the entire estate. If you have no spouse, but have children, your children will take the entire estate in equal shares. If you have no spouse, no children, and no parents who survive your death, your brothers and sisters (and, in some cases, their children) will take your entire estate. It progresses accordingly, but the point is that you have an absolute privilege to name your beneficiaries - rather than having the state name beneficiaries you may not want - simply by executing a will.

Q. Do I need a will?
A. Do you even have to ask? Since you did, the answer is yes. Even if you don't have assets, your will may name a guardian for your children.

Q. Do I need a lawyer to draw my will?
A. No one can force you to retain a lawyer, but what if you or a non-lawyer draws your will improperly? When you die - that's when your will becomes effective for the first time, and often that is the first time it's seen by anyone - your estate may be lost to inheritance taxes, or your will might be invalidated in a will contest, causing your estate assets to pass under the state's distribution laws. Most experienced lawyers will regale you with accounts of totally defective do-it-yourself wills . . . or do-it-yourself divorce judgments which never divorced the litigants . . . or do-it-yourself contracts which turn out to be unenforceable. Lawyers have an old saying: One who represents himself, has a fool for a client. Don't put yourself in that category.

 A. It's a fund created during your lifetime (inter vivos trust) or under your will, whereby the fund is set aside, "in trust," permitting you to name the beneficiaries to receive income and the fund's principal at the end of a stipulated period.

Q. Do I need a lawyer to prepare my trust agreement?
A. No, as long as you know the nuance differences between a "marital deduction" trust, and a "QTIP" trust, and a "by-pass" trust, and a "charitable" trust, and a "gift-to-minors" trust, and a "dynasty" trust, not to mention inter vivos and testamentary trusts.

Q. Does a trust save taxes?
A. It may, if it becomes an integrated part of your estate plan, but, in the main, the then existing tax laws and solid advice from an accountant and our firm are indispensable prerequisites.

Q. Is a trust the same as a living will?
A. No. A "living will," combined with a "power of attorney and health care proxy," gives you the power to decide in advance when you want to forgo artificial life-sustaining treatment . . . resuscitators, respirators, and the like. A living will may be drawn and executed at the time you execute your last will and testament, but doesn't necessarily have to be.

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