Everyone in New York who creates an estate plan must make an important decision about who to name as executor under their will. The executor of a will is responsible for making sure that all of the instructions in the document are followed exactly and assets are correctly distributed to beneficiaries. While serving as executor, a person may have to commit to long hours of sorting through voluminous paperwork and might have to make practical choices that could lead to conflicts.
The first decision to make when choosing an executor is whether to select a professional or a family member. People with complicated estates may lean towards choosing a financial adviser, accountant or lawyer. Selecting a professional will ensure that a person’s estate is handled by an uninterested party with the knowledge and ability to handle complex estate administration issues.
People with relatively simple estates might decide to choose a close friend, sibling or adult child to serve as their estate executor. A friend or family member will have a more intimate knowledge of a person’s estate than a professional. When selecting a non-professional executor , it is important to choose someone who is trustworthy and responsible.
Some people decide to name a professional person and a family member as co-executors over their estate. This arrangement may provide the best of both worlds for some families. In the process of assisting a client in will preparation, a lawyer may be able to discuss all of the options for choosing an executor and help the client to determine what option would be the most practical and beneficial.
Although no one wants to think about their parents dying, there is a chance that a child will be named executor of a parent’s will. Those who are named the executor will need to take specific steps to ensure that the estate can be settled properly. For instance, it may be a good idea to order as many as 15 copies of a death certificate and determine quickly whether or not the will needs to go through probate.
Locating key documents and asset records is a critical role for the executor of a will. Doing so makes it easier to gain access to passwords and other data that may make it easier to transfer assets to beneficiaries. It will also make it easier to verify the contents of a bank account or the overall worth of an estate.
Should a parent have multiple bank accounts, it may be best to consolidate the money inside of them to one account. It will reduce the amount of paperwork that needs to be completed and can make it easier to pay taxes or any other debts that a parent may have left outstanding. Although creditors and beneficiaries may want to be paid right away, those who study the issue say that a good executor is thorough and will take his or her time before settling an estate.
Those who are tasked with being the executor under a will may wish to ask an attorney for assistance. An attorney may be able to review estate administration protocols and help gain access to passwords or other information needed to settle the estate in a timely manner. In some cases, legal counsel will already have vital information stored in their office or know where it is located.
The probate process in New York can sometimes drag on for months or even years, and mounting costs can drain estates and leave heirs wanting. The most effective way to prevent this from happening is to transfer assets in a way that they pass outside of probate, and estate planning strategies that can be used to avoid probate include gifts, death beneficiaries, trusts and joint property ownership arrangements.
Joint property ownership avoids the probate process by transferring property to the surviving joint owner when one joint owner dies. Probate is avoided because the deceased individual no longer owns the property. This is accomplished under New York law with a joint tenancy with a right of survivorship. Gifting assets to heirs is another way to avoid probate, but this strategy requires planning and may be undone by unexpected circumstances. Using gifts to transfer less valuable assets mitigates these risks.
Revocable living trusts allow individuals to transfer property while retaining the right to revoke the trust in the future. Transferring assets to a trust removes them from an estate and avoids probate, and the trust can be set up to transfer the assets to designated heirs upon the benefactor’s death. Beneficiary designations are another estate planning tool often used to avoid probate. Retirement accounts and other financial instruments may allow funds to be transferred to a designated beneficiary when the account holder dies, and these arrangements are often quick and simple to set up.
A comprehensive estate plan may prevent family conflict, avoid probate and minimize estate and gift tax exposure. An attorney familiar with end-of-life matters could explain how addressing these difficult issues can eliminate gnawing anxiety and provide peace of mind. An attorney may also recommend that estate plans be regularly revised and updated in light of evolving family situations or changes in the law.