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Queens Probate & Estate Administration Law Blog

3 ways to reduce estate tax

If you live in New York and have worked hard to leave a legacy behind to your loved ones, you may have concerns about just how much tax the government will assess on your estate. Every dollar the government takes from your estate is one that cannot go directly to your loved ones, so learning how to minimize estate taxes is an important component of the estate planning process. At the law offices of Joseph A. Ledwidge, P.C., we understand the ins and outs of estate planning, and we have helped many clients who wished to preserve as much of their wealth as possible for their loved ones.

Per U.S. News and World Report, one of the most effective methods of preserving your wealth and reducing estate tax involves placing your assets in trusts. Trusts can come in several different forms, so you can do some exploring to find the right type or types to fit your needs. When you create a trust, you must appoint some as trustee, and it becomes this person’s duty to oversee the trust and make sure assets undergo proper distribution to beneficiaries.

When a beneficiary starts living large

During the course of our professional duties here at Joseph A. Ledwidge, P.C., we see our fair share of family disagreements. Among the most acrimonious are those resulting from the alleged misappropriation of estate assets. We understand that everyone deals with grief in a different way: some mourn in solitude while others attempt to live life to the fullest. Unfortunately, the latter alternative sometimes causes discord when that lavish lifestyle is funded by trusts.

Our main concern, and that of the courts in many cases, is that the intent of a decedent is carried out faithfully. That is, after all, the purpose at the core of estate documents: that you have the ability to carry out your loved one's will even in face of even the most extreme circumstances.

When your parents die broke

Saying goodbye to your parents is one of the hardest things you may ever do, and no one wants to worry about juggling paperwork and tying up loose ends when they are going through such an emotionally taxing time. On top of planning a New York burial and helping your family heal after your shared loss, you may also have concerns about whether your parents left considerable debt behind, and if so, whether you might be responsible for it. At the law offices of Joseph A. Ledwidge, P.C., we are well-versed in the answers to these and related questions, and we have helped many clients navigate the many steps that often follow losing a parent.

Per U.S. News and World Report, almost half of today’s seniors die with less than $10,000 in assets, leaving an entire generation uncertain of what happens to their parents’ mortgages, credit card debts and other financial obligations. There is some good news for you if your parents pass on without any money left, however – in many cases, you will not be on the hook for such debts.

What happens if I die without a will?

If you are a New York resident who has yet to make a last will and testament, you may wish to consider making one. Wills are not just for the wealthy. Regardless of your financial status, your will is the means by which you set forth your wishes as to who receives your property when you die.

NYCourts.gov explains that if you die without a will, the State of New York determines who receives your property because you died intestate. Section 4-1.1 of New York's Estates, Powers and Trusts Law makes extensive provision for all manner of your possible heirs, such as your spouse, children, grandchildren and other relatives, none of which may have anything to do with your own wishes. In fact, your own wishes are irrelevant, even if someone knows what they were.

How to remove an executor of an estate

Change is something that is inevitable when it comes to contending with an estate and probate. If you are dealing with the prospect of probate after a loved one has passed away, it is likely that you have come across outdated wishes and a set-up that is no longer appropriate to the situation.

It is also quite common for loved ones of a deceased person to have issues with the executor of the will. You may feel that he or she is acting in one's own interests, being manipulative, or that he or she is not fulfilling duties as the person is required to do. While a living person can effortlessly remove an executor of one's will, it becomes considerably more difficult for a loved one to do this after a will maker's death. However, there are certain situations where it is possible.

Considerations in choosing an executor

If you, like many people across New York, are working on your estate plan, one of the many important decisions you may have to make involves who to name as your executor. The executor role involves a high level of trust and responsibility, so it is not a decision you should make without first devoting careful consideration to it. At the law offices of Joseph A. Ledwidge, P.C., we recognize the critical nature of naming the right person as executor, and we have helped many clients navigate this and related estate planning matters.

According to the American Bar Association, the executor has numerous responsibilities relating to getting your affairs in order after your death. Executor duties might include paying estate taxes, paying claims against the estate, handling probate and notifying beneficiaries, among others, so it is important that you pick someone who you can trust to handle a lengthy list of important matters.

What is standing and how does it apply in will contests?

One of the most important questions for challenging a will, or for any civil litigation for that matter, is whether you possess standing. Standing is like the main gateway to pass through to start civil litigation. A New York court wants to know that you have a legitimate interest in contesting the will. If not, the court will not allow you to proceed.

As Findlaw describes, while laws regarding standing differ depending on the jurisdiction, typically a person who can contest a will is somebody who is already named on the will. Generally people who are named on a will but contest it feel that they are not receiving a proper portion of the inheritance or have problems with how certain assets will be distributed. Being named on a will can provide a huge advantage to receive standing.

Reasons to keep checking your beneficiary designations

Will the money in your retirement account actually go to your children as you intend? Unfortunately, not all New York residents can be sure. While you may list your children as your heirs in your will, you may have actually named someone else as the beneficiary on your retirement account or pension. As an article on the CNBC website points out, some people do not always update their designated beneficiaries, causing many would-be heirs to wage court battles to retrieve assets from a dead relative only to receive nothing for their pains.   

Sometimes problems arise in cases involving divorces. Someone may designate a wife or a husband as a beneficiary, but after a divorce, the individual fails to remove the divorced spouse as a designated beneficiary. Thus, when the person dies, the divorced spouse gets the assets instead of children, step-children or other heirs. Beneficiary designations can even trump divorce agreements where the ex-spouse has waived rights to receiving future assets. 

Why asset consolidation can help your estate planning

Important life decisions become even more crucial as you enter middle age. You likely have already implemented New York estate planning for your children, perhaps by setting up a will that leaves your assets and property to them when you pass away. However, it is possible that not all of your assets may end up in the hands of your loved ones. If you are not careful, some assets might slip through the cracks.

As Forbes points out, people accumulate a lot of assets over a lifetime. People in middle age have probably changed jobs several times and in the process have opened up different retirement plans at those jobs. You might have left several accounts floating around that you may not remember or do not regard as important since they have not reached maturity yet. Additionally, you may have made a number of small investments or own pieces of real estate. Over the years, these investments can add up.

What are common reasons to contest estates and last wills?

Few people have more than a cursory knowledge of the probate process until they find themselves involved with an estate. Even if you created your own estate plan, you likely relied on the guidance of an attorney to create your will. So, you may still be confused now that you need to administer an estate as executor or if you are a beneficiary to a large estate.

One issue that people often find confusing when and how to contest a will or estate administration process. If you are an executor, you may be nervous about possible challenges to your role as administrator of the estate. If you are an heir, you may have similar questions about when you should consider challenging a last will or estate administration. Knowing the most common causes for contesting an estate can help you make informed decisions about your situation.