ESTATE PLANNING SERVICES:
Do you need a Will or Trust?
What is a Will?
The most important aspect of a Will is that it explains who will inherit all your assets (personal, financial or real property) and where your children shall be placed should something happen to you or your spouse.
In absence of a Will, a court can force your loved ones to sell assets, including real estate, without regard for tax consequences and without guidance as to what is best fo ryour heirs. If you have a Will, the courts are obligated to follow your instructions which will allow your heirs to benefit in the manner that you so choose. And only those that you choose will inherit whatever you wish them to have. It is entirely your choice.
What is a Trust?
Like a Will, you can use a Trust to designate who you want to inherit your assets. The difference, however, is that all Wills need to be approved by the courts. Once approved, and the process can take many months, your heirs can inherit. With a Trust, however, you do not need to go to court to get it approved before your heirs inherit. They pay all your debts, take care of any last minute issues, and then distribute the money, period.
Trusts are either revocable or irrevocable. Revocable Trusts simply allow your heirs to avoid probate, that is, getting court approval to distribute your assets. An Irrevocable Trust is used to keep money out of a person's estate for either Medicaid planning or to let the assets grow, sheltered from creditors.
Trust Administration and Probate:
Probate is the process by which the assets of the decedent are transferred to the beneficiaries named in his/her Will. If there is a Will, the person named as Executor files a petition with the court to become the Executor. Once appointed, that person distributes the assets to teh named beneficiaries after paying all the creditors.
If there is no Will, someone close to the decedent files a petition to become Administrator of the Estate. The process is similar to probate, however, the Estate assets are distributed according to Intestate Succession laws rather than to the decedent's wishes. They may be the same, but they may not as well. Only by creating a Will or a Trust can you be sure that your assets go to the people you choose to benefit.
The benefit of putting your wishing in writing?
Setting up a plan ahead of time makes it easy for your loved ones to receive what you've amassed during your lifetime and it puts everyone on notice, including the courts, as to what your true wishes are for the distribution of your Estate. A carefully prepared plan will protect your estate and will help manage how, when and, to whom, your assets are distributed. Remember, going to Administration court is much more costly and cumbersome than naming an Executor to oversee the distribution of your Estate, through the Probate court, according to your wishes, which you have detailed in a Will. If you have prepared a Trust, your cost drops even more as no court administration is usually required. Furthermore, some Trusts have an added benefit of protecting assets from creditors including Medicaid.
Plan early to retain what has taken you a lifeitme to accumulate so that your heirs can benefit. Devise a plan that works for you. And importantly, ask me how you can protect your assets against the cost of long term care.
Disclaimer: This site is provided for informational purposes only. While legal issues are discussed, it is not legal advice or legal representation. We make no warranties or guarantees as to the accuracy and authenticity of the information provided herein and suggest that you contact an attorney to discuss your particular situation.
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Disclaimer: This site is provided for informational purposes only. While legal issues are discussed, it is not legal advice or legal representation. We make no warranties or guarantees as to the accuracy and authenticity of the information provided herein and suggest that you speak to an attorney to discuss your particular situation.
Iris Bikel, Esq.
309 West 86th Street, Unit 6B
New York, NY 10024
646.969.6989 x101 (phone) / 917.640.6292 (mobile)
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