January 22, 2020

Making an Estate Plan? Do Not Forget Your Business Succession Plan, Too

If you have a family business or started a company that you would like to keep in the family after you pass away, you need to create a succession plan. Even if you wish to sell that business, speaking with an estate planning attorney about your business’s future is critical – and you can incorporate your business succession plan into your estate plan.

Why Plainview Business Owners Need an Estate Plan and a Succession Plan

You might assume that you have an estate plan; therefore, you do not need a succession plan. What you may not realize is that all assets, including private businesses, do go through probate – unless you have named beneficiaries through a trust. Certain trusts can allow your assets to pass outside of the taxable estate, including your business.

To take advantage of those trusts, you need an attorney to help set up a business succession plan alongside your traditional estate plan. This way you protect your business, investment, and your loved ones at the same time.

The Consequences of Not Planning – and Not Including Both Options

Without considering a complete plan that incorporates personal and professional assets, your family may suffer from severe financial and emotional consequences.

The Consequences of No Business Succession Plan

  • No Clear Direction – Who will lead the business? Who takes over and manages? Without a succession plan in place, there is no clear direction for how the company will continue to operate (or if it should operate) after your death.
  • Creates a Fear of Uncertainty – A business relies on its employees. But when leadership is mismanaged, power struggles occur over who should run the business, and the company is left picking up the pieces. Employees may leave for a more transparent future than stay with a company that is full of uncertainty. After all, employees want personal job security.
  • Family Disagreements – Family members left to make decisions for the business may go through disagreements, and decisions like these can tear families apart.
  • Loss of Value – When the key person running the company dies, surviving shareholders may go to sell the business and realize that there is a loss in value because of that person’s death.

The Consequences of No Estate Plan

  • Tax Liability – Without an estate plan drawing a line between professional and personal income and assets, a family may experience estate tax liability that they had not planned on encountering.
  • Probate Court – Family members will have to endure probate court fees and time lost for private assets as well as the business.
  • Delayed Distribution – Without an estate plan, the estate waits in line for its turn in probate, which means there is a delay in the distribution of assets. It may take months to years for the estate to resolve, depending on the complexity of that estate.
  • Litigation Costs – Family members may have unexpected legal costs for disagreements amongst each other.

The Tax Considerations for a Budding Business

Between the time you make an estate plan and the time you pass away, your business may see significant growth. That means the amount of money your business generates can increase the value of your estate – and with that value comes the issue of estate taxes.

How Does the Business Succession Plan Differ from an Estate Plan?

Your business succession plan focuses strictly on the business and assets associated with that business.

At a bare minimum, your succession plan needs to focus on the transfer of management of the business or the ownership of the business entirely.

The procession of management succession typically involves:

  • Developing, training, and supporting successors
  • Delegating responsibility and authorities to successors
  • Bringing in outside advisors to help in the process
  • Maximizing employee retention by creating a smooth transition and proper planning

The process of ownership succession might involve:

  • A plan that coordinates the person who will own the business after death and who will manage the business (if they are two separate people).
  • A plan that considers the best interest of both sides.
  • A plan that involves moving the business over before the current owner’s death – giving that past owner a chance to meet with, cultivate, and guide successors.

Can You Make a Business Succession Plan without an Attorney?

A business succession plan protects your business, loved ones, and any employees you might have. While you know this, you should also know the importance of hiring a professional to draft that protection.

Templates online rarely address the complexity of each business, and every company is unique in what they need for succession to work. Succession plans account for various circumstances, including how partners will handle the business, what happens if legal agreements are violated, and how the business moves forward if you were to pass away unexpectedly.

These legal hurdles are serious. Without the right plan in place, your business could fail.

An attorney addresses any unique legal concerns your business might have, and an attorney will address all state and federal issues that could arise.

Business planning requires attention to detail and vast knowledge of employment, business, and estate laws. For this reason alone, a business owner should enlist the help of an attorney in their succession plan. An attorney will consult with tax experts to assist them in drafting a plan. Also, if a legal dispute does arise about your business later, your estate attorney will be able to defend your plan and your estate in court after your passing.

Consult with a Local Attorney that Helps Your Business Pass Safely

Attorney Andrew M. Lamkin, P.C., can help with not only your estate plan but your succession plan too. By going over your business’s unique needs along with your personal concerns for your loved ones, I will help you create a succession plan combined with a substantial estate plan that protects your family for years after your death.

To get started, schedule a consultation with my office at 516-605-0625. You can also schedule your free case evaluation appointment online.

What Is a Certified Elder Law Attorney – and What Can They Do for Me?

Description: An elder law attorney can help you long before retirement with everything from long-term care to Medicare and even the creation of an estate plan.

You know that you need an elder law attorney. But as you ponder over your options, you might have noticed some attorneys have called themselves “certified,” while others do not. The certification they have received may come from organizations like AARP’s Legal Services Network while others are members of the National Academy of Elder Law Attorneys (NAELA). Some attorneys go further and receive an official certification through an ABA-approved program.

While certification means they are proficient, that does not mean they are the right attorney for you. Instead, you should consider the pros and cons of certification, memberships or affiliations the attorney has, and their overall experience before solely choosing based on certification status.

Does an Attorney Require Certification in Plainview?

No, an attorney offering estate planning or elder law services in Plainview, NY, does not have to be certified in elder law. They do, however, require registration with the state bar association.

You can verify that your attorney is a member of the New York State Bar Association, and you can contact the Bar to see if there are any complaints or pending actions against an attorney you are considering.

What Does a Certification Mean?

Some attorneys will receive a certification in their legal specialty. This may require continuing education, testing, peer reviews, and passing exams to obtain that certification. Certification is an additional peace of mind. And while it does prove an attorney is capable in the area of elder law, you still want to consider the other items that go into an attorney’s qualifications.

Memberships Matter Too

Most attorneys will be members of organizations specific to their specialty. If an attorney practices elder law, they should be a member of the National Academy of Elder Law Attorneys (NAELA).

NAELA is a professional organization that provides continuing education to its members, peer networking, and helps local clients more easily find qualified attorneys.

To be part of the Academy, attorneys must be practicing members of the bar and offer legal services that address the needs of the elderly. They must represent a high code of ethics, exhibit knowledge in their field, and show commitment to their clients as well as remain active in the Academy.

These memberships are paid, but that payment helps fund continuing education and advocacy programs offered by the organization. Attorneys who are members of NAELA also have access to comprehensive libraries, knowledge databases, and other resources.

Another membership you should look for from an attorney is in the AARP Legal Services Network. This means that the attorney you are considering offers you a free consultation if you are an AARP member. Because elder law attorneys deal with local seniors, you would expect one to be part of this network and honor the discounted consultation fee. If an attorney is not a member of the local legal services network, you lose out on the free consultation opportunity.

Do Not Forget about Local Advocacy Groups

You are working with a local attorney, so you should expect to see a local advocacy group or organization affiliation. In Nassau County, an attorney practicing in elder law should be a member of SUN (Senior Umbrella Network), Nassau Chapter.

This group offers local professionals networking and continuing education opportunities specific to elder law and planning.

Looking at Core Services

Once you have looked over certifications, memberships, and affiliations, the next step is the services offered by the prospective attorney.

Remember, certifications are only a minor piece of the puzzle. If your prospective attorney is a full-service firm, how much time can they dedicate to elder law continuing education? How often do they address elder law plans, Medicare planning, and other long-term care planning needs?

An attorney may offer elder law services, but your goal should be to find one that specifically works in the estate and elder law field. This attorney will be up-to-date on the latest changes, including proposed changes in legislature. They work consistently in the area of elder law; therefore, they are well-versed in their field, know what local probate court judges expect, and how Medicare representatives review applications.

An attorney working exclusively in this field will also help plan for the unexpected – like the need for guardianship, creating advanced directives, or taking care of loved ones later in life.

Here are just some of the services an elder law attorney can help you with:

  • Living Will
  • Healthcare Proxy and Advanced Directives
  • Durable Power of Attorney
  • Medicaid Planning
  • Estate Planning and Estate Tax Planning
  • Asset Protection
  • Estate Administration and Probate Litigation

Do You Need an Attorney for Long-Term Planning?

If you are ready to create your estate plan, need to adjust one you already have, or you need the services of an elder law attorney in your area, contact attorney Andrew M. Lamkin, P.C. He is a member of the AARP Legal Services Network through Allstate and part of the NAELA group of professionals.

You can schedule your free, no-obligation consultation with the Law Office of Andrew M. Lamkin, P.C., now at 516-605-0625 or request more information online.

What Is Ancillary Probate?

If you are like most who are starting out with estate planning, you have heard of probate court – and you know that you want to do what you can to avoid it. What you might not have heard about is an ancillary probate. Ancillary probate is a secondary probate for your estate when you own property in another state.

Loved ones must endure the costs and hassles of a formal probate court. But adding on the hassles of ancillary probate can be even more taxing.

Two probates happen when you have out-of-state real estate because real estate is governed in the state where it is located – regardless of where you reside.

When Would a Plainview Resident Have Ancillary Probate?

Second probate court proceedings happen when you own real estate or tangible property outside of New York. For example, you have a New York primary residence but also a Florida condo you use in the winter.

Realize that ancillary probate is not just a vacation home or secondary residence. It can also involve tangible property. For example, you own a plot of land without any buildings on it in Montana. Another reason for ancillary will be if you own mineral rights out of state.

Your New York probate court would handle all property in New York, but any property outside of New York would require ancillary probate. When you own multiple properties or tangible properties out of state, each state would have probate proceedings for those pieces of real estate.

The Process for Ancillary Probate

First, the domiciliary probate process initiates. This occurs when the decedent’s state recognizes the will, and the executor starts the probate proceeding.

In some cases, the executor may also initiate the ancillary probate.

Any challenges to the estate plan are done in the domiciliary state’s probate court. Once the court admits the will, the ancillary states follow.

The process varies by state, but the process of ancillary probate is shorter than formal probate. Some states even offer streamlined ancillary probate processes, including allowances for foreign executors (an executor residing in another state). By doing so, the foreign executor can take control of the property and transfer, sell, or manage it by the instructions of the will.

The Negative Impact of Ancillary Probate

It is better to avoid ancillary probate because, like formal probate processes, there are consequences to going through the process.

One of the most significant consequences is the cost. It is costly enough to administer an estate in one state, but two states with two probates is expensive. Beneficiaries will not only endure the time of both courts, but also endure multiple court fees, attorney’s fees, and accounting costs.

If the deceased passes intestate (meaning they have no valid will), the intestacy laws of that state determine how the property will be handled. Every state is different with how they handle property if there is no will. Rightful heirs of the intestate estate may find that the property is dealt with differently in the other state – and not always favorable to them.

How to Avoid Ancillary Probate Entirely

Probate is not necessary for real estate in your domicile state let alone property out of state. With a trust, you can avoid probate entirely. With a living trust, your property is passed directly to your beneficiaries.

To do this, you would put the title of your out-of-state property and any in-state property into the trust. By doing so, the trust now owns the property (not you). Upon your death, the trustee would then distribute assets from the trust by the trust rules.

Using a living trust is the most common method for avoiding probate in both states. If you don’t want to use a living trust, you may also be able to:

  • Own the property with another person: Owning the property with another person opens the door to joint tenancy, which means the property would pass to the other owner upon death.
  • Transfer-on-Death deed: A transfer on death deed (TOD) transfers real estate upon death. You must record it and file it with the local records office for it to be valid. Note that not all states allow a TOD. New York, for example, does not allow TODs. Therefore, if your ancillary property is in New York, you would not be able to use this method for avoiding ancillary probate.

All of these options might work for your estate, but it is best that you consult with an attorney. Depending on your estate’s size, assets, and beneficiaries, some options for avoiding ancillary probate may not work for you.

Consult with an Attorney Regarding Your Ancillary Property and Possible Probate

If you have an out-of-state property you use as a vacation home, rental property, or you own mineral rights in another state, protect these assets by meeting with an attorney and drafting an estate plan that addresses the unique issues these properties create.

You can still protect your loved ones and avoid ancillary probate. To explore your options, speak with an attorney by calling the Law Offices of Andrew M. Lamkin, P.C.

During your free consultation, we can go over each option, discuss the pros and cons of your estate going through ancillary probate, and draft an estate plan that protects your long-term care needs and provides for your loved ones when the time comes.

Schedule your meeting today by calling 516-605-0625 or request more information online.

Estate Planning with an Out-of-State Vacation Home

It is not uncommon to find a client that has property in multiple states. Usually, it involves an individual or couple that has their primary home here in New York but a vacation home elsewhere else in the country.

Whether you have a vacation home in Florida for the warm summers or a snow-ready cottage in the mountains of Utah, it is essential that you do not forget about it when you make your estate plan.

Also, you must realize that the laws for your out-of-state vacation home might differ from where your primary residence is located. Therefore, it is important you speak with an attorney to ensure that you have both jurisdictions covered and your estate plan does not violate any laws.

Your Plainview, NY, Domicile in Estate Planning

In estate planning, you hear various terms. And one that you will hear often is your domicile. The law allows for you to have one main place of residence, the domicile, which is where you return when you leave.

A person could technically spend three-quarters of the year out-of-state and still have a domicile in another. In most cases, identifying the domicile is easy. But other times, it might become complicated when you split your times equally between two residences.

You might ask why it matters where your domicile is, and what the difference is between a vacation home and main residence. The main issue you are addressing by labeling your domicile is the state estate tax or income taxes that must be paid upon death. Also, your domicile location determines which probate court has jurisdiction over your estate and your beneficiaries inheritance.

Where you are domiciled has a significant impact on your estate, especially for taxes. Even if your estate is exempt from the federal tax, some states impose estate tax at a lower threshold than the federal level. When you do not specify clearly in your estate plan, two states may claim that you have domiciles in their territory and both apply a tax.

Declaring a Domicile Might Help

You can declare your domicile within your estate documents. Doing so is helpful for determining which state can impose taxes and which probate court has jurisdiction.

Simply stating your domicile state is not enough. Instead, you must use evidence to support your declaration to avoid the state contesting your domicile designation. One way to prove which residence is your domicile is by providing:

  • Physician information – People see physicians in their home state. Therefore, your primary physician should be located in the state where you declare your domicile – and you would have insurance billings and records to prove it.
  • Employment – Your employer is typically located in your domicile state. Therefore, employer information helps support your declaration.
  • Voter registration – You are not required to register as a voter, but doing so helps establish your domicile state.
  • Bank accounts – Showing where your bank accounts were opened and managed help prove your domicile, too – especially if you use a financial institution that is not located in the state of your vacation home.

Ancillary Probate and Your Vacation Home

You want to avoid probate. But if you did not plan properly, your real estate in another state could be subject to that state’s probate. Known as ancillary probate, your beneficiaries may have to deal with the hassles and costs of waiting for probate to complete.

Avoiding ancillary probate is easy if you use the tools similar to those available for your home state – such as transferring the deed of your second home into a trust or creating a limited liability company to hold the property.

Selling or Gifting Your Vacation Home

Now that you have declared your domicile, you need to help loved ones avoid taxes on your secondary real estate. Property is often the highest value asset in an estate, and there are tax implications – especially for out-of-state properties.

An attorney can help you avoid being subject to estate or income tax where the vacation property is located. One of the better ways to avoid taxes is to transfer or sell the property to a family member through a trust. This keeps the real estate in the family.

One issue with doing so is your long-term care planning. When you do not transfer ownership correctly, that vacation home could be seen as a personal asset, which may disqualify you for Medicare or Medicaid benefits.

Questions to Ask before You Plan for Your Vacation Home

Before going through the hassles of selling, transferring, or planning for your vacation home, address the following questions:

  1. Does anyone in the family want the home? You may have sentimental ties to your family vacation home, and you might want to leave it to a child. But before doing so, ask if they want it. For some heirs, inheriting a vacation home is more of a hassle than benefit. Some may prefer to receive the liquid assets rather than the home itself.
  2. Who will pay to upkeep the vacation home? Vacation homes are expensive and still require maintenance even if they sit empty for weeks or months at a time. Some heirs may not be willing to cover the upkeep of that home. If you truly want the home to be a benefit, you may want to set up a trust that includes secondary funds for maintaining the vacation property.

Own a Vacation Home or Secondary Real Estate? Hire an Attorney First

Planning for a secondary home or vacation property can be complicated, especially when you are dealing with two different states. If you have a vacation property and you want to explore your options, schedule a consultation with an estate planning attorney.

The Law Offices of Andrew M. Lamkin, P.C., can help go over your options, discuss the pros and cons for both, and find a solution that works long-term for you and your beneficiaries.

Schedule your free consultation today at 516-605-0625 or contact us online to get started.

How Long Does an Executor Have to Go through Probate in NY?

An executor has a duty to the estate to complete the probate as quickly as possible. While sometimes it takes a few months, estates can take up to three years to complete.

An executor is a party who oversees administering an estate after the individual dies. In New York, they can invest whatever amount of time necessary to settle the estate entirely. However, the law holds exceptions. If an executor assumes his or her role but then fails to execute any of their responsibilities toward the estate, the court or a beneficiary can petition his or her removal.

Unfortunately, there is no set time for how long the executor has, because every estate is different and unique circumstances might delay the process for the executor. Typically, an executor should complete the probate process in one-year without complications and about three years when there are complications.

The Processes of Probate in Plainview, NY

To understand how long your case might take, you must understand the processes that go into probate. These are the steps the executor must go through to complete probate – and the steps you must wait through, too.

The Appointment of the Executor

After a loved one passes away, the courts must first validate the will and decide that it is authentic. During that validation, they will appoint the executor named in the will. You can expect this process to take up to a month. The executor initiates the process by submitting the will for probate. So if it takes longer, the court may penalize them for filing too late and causing financial harm to creditors and beneficiaries.

Delays in Appointing the Executor

It can take even longer to appoint an executor, depending on situations that might arise. Some issues that could delay the process include:

  • Problems with collecting documents. Sometimes loved ones are not cooperative when it comes to signing and having documents notarized. When an executor must wait on the family, the process can become much lengthier than necessary.
  • Court delays can occur. Courts take time processing documents too, which can be anywhere from four to eight weeks, depending on the status of their docket.
  • Issues with third-party hearings. Sometimes the court must appoint a third party to investigate and create a special report. This will involve two court hearings instead of one.

The Payment of Creditors

Appointing the executor is merely one step of many. Now that the executor is in place, the executor must notify all creditors named in the deceased’s will. From there, creditors are given seven months to make any claims against the estate for funds owed.

Executors are personally liable for all debts owed by the estate if he or she distributes assets from the estate before creditors are notified or have time to file their claim. Therefore, you could not expect the executor to complete this process sooner than the required seven month timeframe.

Filing Estate Tax Returns

Your executor must file all federal estate tax returns, which tend to consume the most time. A more considerable estate may fall under federal taxes for their value, and the deadline is nine months post-death. Then, after filing, the executor must wait for the IRS to approve the return and issue a closing. The executor cannot distribute assets until this process completes, which could take up to two years if issues arise in the filing.

Liquidating Assets

Another delay is that the estate might require the executor to liquidate assets. When the estate has assets harder to sell such as private shares in a business, real estate with tenants, or undesirable assets, selling them may take longer. Another example would be a family home that is in disrepair and must be first repaired, then wait for the however long it takes to sell.

Without liquidating these assets, the executor cannot move forward.

Will Contests and Accounting Contests

One of the most significant delays in probate is contests. Whether someone contests the will itself or they contest the accounting and property valuations, these cause significant delays. The estate must wait for an appointment with the court, which may take weeks or months to complete.

The executor must initiate a financial report to all beneficiaries that detail the transactions and any financial activities of the estate. This is one of the last steps before they can close it out and distribute assets. All it takes is for one beneficiary to disagree with that financial report and contest it. From there, the court must determine the accuracy of the accounting statement. This process alone could take up to one year.

The Bottom Line

There are numerous ways to delay the closing of an estate. While sometimes it could be the fault of the executor, most of the time it is out of their control. If you suspect that your executor is purposely delaying or not doing their fiduciary duty, then you should speak with an attorney to explore your options.

Working with a Qualified Attorney Can Help

Whether you need help as the executor of an estate or you would like to draft an estate plan that helps streamline the process, working with a qualified estate planning attorney in New York is your best option.

For assistance with your estate or the probate process, contact the Law Office of Andrew M. Lamkin, P.C., today at 516-605-0625 or you may contact us online. We offer free, no-obligation consultations.

10 Essential Questions to Ask before Hiring Your Elder Care Attorney

When you are looking for an elder law attorney, ask these questions before hiring him or her to make sure they are the right fit.

As you age, concerns about your living situation, care needs, and finances start to arise. You might wonder how you will pay for long-term care, what will happen to your assets, or who will take care of you and make decisions on your behalf.

All of these are legitimate questions and concerns and ones you should bring to an elder law attorney. Elder law lawyers focus on the unique legal matters of seniors, and they can help you manage your circumstances today and well into the future.

Regardless of what questions bring you to an attorney, you need to meet with one earlier rather than later. The sooner you get an attorney involved, the easier it will be to put your concerns at ease and get you on the right path.

10 Critical Questions to Ask a Potential Elder Law Attorney

You have an attorney in mind, and you have scheduled the consultation. The next step is to create a list of questions. These questions help gauge whether the attorney is a good fit for your needs and addresses any initial concerns you may have. You want to address these questions in the consultation so that the attorney better understands what services you need.

1. Are You a Certified Elder Law Attorney?

An attorney can prove their prowess in elder law by being certified through the National Elder Law Foundation (NELF). NELF helps attorneys understand the requirements regarding their clients better. To remain certified, your attorney must continue their practice focusing on elder law and do specific amounts of continuing education.

To certify, your attorney also must have a license in your state, maintain good standing with the New York State Bar Association, practice law for a minimum of five years, complete 45 hours of continuing education in elder law in the past three years, have references from five attorneys, and pass an examination.

2. How Many Years Have You Practiced Elder Law?

Some attorneys branch out into elder law because they see the growing demand. However, they do not practice exclusively in this area, or they recently opened their practice to that area of the law. Preferably, you want an attorney who has several years of experience. This is because the regulations regarding senior care, estate plans, and long-term care planning change continuously – and you need someone experienced with the case law and changes.

3. Is There a Niche in Elder Law on Which You Focus?

Some attorneys only focus on specialized areas of elder law such as elder abuse, long-term care, Medicare or Medicaid planning, and Social Security. Inquire about what areas of elder law your attorney practices in to make sure they cover not only the services you need, but also the services you may require in the future.

4. Do You Have Experience with Cases like Mine?

Every client and every case is unique. You want an attorney that has experience working on similar issues like yours because they are faster at creating a solution than an attorney venturing into unknown waters.

5. Who Will Handle My Case?

When you meet with an attorney, you should always ask who will be handling the case. The attorney you meet with might represent your case in court, but the back-end work involves a team of professionals such as an accountant, paralegal, secretary, and possibly other attorneys. Therefore, you’ll want to know who exactly you will encounter and who does the work on your case.

6. How Familiar Are You with the State Laws?

Your attorney is a guide through the legal system. You want to know the laws and how they affect you when it comes to areas like Medicaid, Medicare, long-term care planning, nursing home rights, estate planning, asset management, and more.

Your attorney should be well versed in all laws that affect your estate plan and long-term care planning.

7. What Relevant Organizations Do You Participate In?

Your attorney should participate in organizations that influence elder laws and planning. Examples would be: the Special Needs Alliance, local or state agencies involving elder law, and the National Academy of Elder Law Attorneys, Inc.

8. How Familiar Are You with Medicare and Medicaid?

One of the most important services you receive from an elder attorney is Medicare or Medicaid planning. Therefore, you need an attorney that is well versed in these government systems and knows how to plan for long-term care properly.

Medicare is for individuals 65 years and older or those with a qualifying disability. These programs are highly complicated and have strict requirements. Your attorney must understand all of the requirements for Medicare or Medicaid, including assets, custodial care, and the needs-based entitlements from Medicaid.

9. What Happens to My File If You Stop Practicing?

One crucial question clients forget to ask is what happens to their files if their attorneys stop practicing. What if a severe illness strikes your attorney or the attorney retires? Who takes over their cases? Ask about your potential attorney’s contingency plan, and what they have in place in the event they retire or an emergency occurs.

10. What Suggestions Do You Have for Me?

You can get an idea of what your potential attorney has planned for you just by asking for suggestions. What do they suggest you do so that you can qualify for Medicare in the future? How do they suspect they will handle your assets in your estate plan?

Meet with an Elder Law Attorney in Your Area Today

The questions you have about your future should not go unanswered. If you need an elder law or estate planning attorney, meet with attorney Andrew M. Lamkin, P.C., at the Law Office of Andrew M. Lamkin.

He can meet with you and discuss your questions, find solutions to your pressing concerns, and help you navigate through the complexities of long-term care planning – including estates, assets, and Medicaid planning.

Schedule a free consultation today at 516-605-0625 or request your appointment online.

What Assets Should You Put in a Trust?

Not sure which assets you should transfer into a trust? There are some you can transfer (and should), while others could cost you when it comes to taxes and penalties.

Creating a trust is only half the battle. The most critical step to establishing a revocable trust is to fund that trust. Funding, in its simplest terms, means transferring assets from your name into the name of the trust – making the trust the owner of that asset.

A revocable living trust is the trust of choice for many families today. They break away from reliance on a will or joint ownership and save loved ones the cost and time of probate court. Furthermore, they allow beneficiaries to receive their inheritance faster.

Assets You Can and Cannot Put into Your Plainview, NY, Trust

Funding is a critical step to finalizing your trust. Once your assets are put into the trust, you are the trustee, and you control those assets. As the trustee, you buy and sell assets associated with the trust, and you do not need court approval.

The funding process sounds daunting, but it is not. One thing funding does require is time. You will need to fill out the documents allowing you to transfer ownership, and an estate planning attorney can help if you do not wish to do so yourself.

Not all assets can transfer into a revocable trust. Therefore, you need to understand what assets you can and cannot transfer, and ones that you should prioritize in case you are unable to move all of the assets in time.

Types of Assets You Cannot Put in a Revocable Trust

As stated before, not all assets can go into a trust. These assets are those that cannot be retitled, but you can still designate a beneficiary for them.

  • Retirement Accounts – Your retirement account is yours, and you have funded it. But you cannot place it into your trust. Any retirement account, including a 401(k), IRA, and annuities should never be put into a trust. If you do, then the transfer of those assets will count as a withdrawal and 100 percent of the value is subject to income tax. To avoid such tax, name the trust as the beneficiary on your beneficiary designation.
  • Health Savings Accounts or Medical Savings Accounts – If you contribute to an HSA, you may be unable to retitle that account. If you cannot, you can again name the trust as the primary or secondary beneficiary.
  • Life Insurance Policies – Life insurance policies can be transferred into a trust, but ask your attorney before doing so. Sometimes it is better to use the trust as the primary or secondary beneficiary.

Types of Assets You Can and Should Put in a Revocable Trust

Other assets can and should be placed in your trust. These assets are quickly passed to your loved ones, and they avoid going through probate – a lengthy and costly process.

All these accounts should be your top priority. Because without them being in a trust, they could be subject to creditors. Many of these accounts will hold high value and may contain inheritances your beneficiaries need immediately. If they are subject to probate, then your family will need to wait for the probate process to complete itself.

  • Cash Accounts – Cash accounts, including savings and checking accounts, money markets, and CDs should be placed into a trust. Check with your bank before transferring a CD. Some financial institutions consider a CD transfer a withdrawal, which means you could be penalized. If that is the case, name the trust as the primary or secondary beneficiary instead.
  • Investment and Brokerage Accounts – Any investment account you have, including brokerage accounts in your name or joint accounts, should be transferred into your trust.
  • Annuities – A non-qualified annuity can be transferred into the name of your Revocable Living Trust, and you can also name the trust as your primary or secondary beneficiary if you prefer.
  • Stocks and Bonds – If you have stocks or bonds in certificate form, you can return those certificates to the transfer agent and receive a new certificate with the trust named as the owner. If you want to avoid the hassles of transfer, you can also deposit the certificates into a brokerage account and then transfer them that way.
  • Personal Property – Tangible assets like jewelry, books, papers, household goods, and other personal property can be put into the trust.
  • Businesses – If you have business interests such as stocks in a public corporation, you can transfer those into the estate. However, you must read all shareholder agreements to ensure you are complying. Also, review any partnership agreements and operating agreements to ensure you follow the rules of transfer.
  • Unsecured Personal Loans – Any money owed to you may be transferred into the trust. If you have an unsecured personal loan out, the proceeds of that loan repayment can go directly into the trust.
  • Royalties, Trademarks, Patents, and Copyrights – You will need to go through the federal guidelines to transfer any royalties from patents and copyrights into your trust.
  • Oil, Mineral, or Gas Rights – If you have ownership of these rights, you may be able to transfer them or assign a new deed with the name of the trust listed.
  • Real Estate – Any real estate you own can be transferred into the living trust. You will need to have a new deed recorded where the real estate is located. Therefore, if you have a vacation property, you must receive a deed in that vacation property’s city or state.

Concerned about Your Assets? Talk to an Estate Planning Attorney First

Identifying which assets you can and should transfer versus those you cannot requires an understanding of estate planning laws here in New York.

Instead of trying to decode the law, speak with an estate planning attorney who can help you identify the assets best suited for your estate plan and those where you would name the trust as the beneficiary instead of transferring.

Contact the Law Office of Andrew M. Lamkin, P.C. to explore your options at 516-605-0625 or request a free consultation online.

The Steps to Creating a Solid Estate Plan for the Elderly

Creating an estate plan as a senior requires a more complex approach than someone in their 20s – including specific steps you must take to protect yourself.

No one sets out thinking about mortality. But eventually, you will come to the point where addressing your mortality is critical for yourself and your loved ones.

Ideally, you should start estate planning in your 20s. Most experts would agree that by then you have an income, debts, and possibly assets. All of which need to be addressed in an estate plan. In the United States, 81 percent of those ages 72 or older do have an estate plan, And Baby Boomers (ages 53 to 71) has 58 percent of their generation with a solid estate plan, too. However, an astounding 64 percent of Generation Xers (ages 37 to 52) do not have any estate plan. Therefore, if you are reaching retirement or you are a Baby Boomer without an estate plan, now is the time to implement one.

When you are retired or reaching retirement age, your estate planning is more complicated (and often feels rushed) compared to someone in their 20s. You do not have as many years to make corrections or put long-term plans in place. Also, you may need to conduct long-term care planning over the course of a few weeks rather than months.

Even if you do not have an estate plan, there is never a wrong time to start. An estate plan protects your loved ones from having to make difficult decisions but also ensures that your assets go to the beneficiaries you want to receive your estate.

Essential Steps to Follow for Plainview, NY Seniors Ready to Plan

Whether you are in your 50s or pushing 70, now is the time to get your estate in order. You may need to move quickly, but do not over-rush your decisions. Take the time to think about what you want and confer with a family to see if they agree with your choice.

Pick Your Estate Team

You need an estate planning team. This team of professionals will help create a plan that not only adheres to local laws but also protects your financial interests. A good team starts with an estate planning attorney. You will want an attorney that also has experience in elder law since some of the issues you must address focus specifically in that area of the law.

An accountant and financial advisor should also be brought into the team. You may already have an accountant that handles your budgets and taxes or an advisor that addresses your retirement. Regardless, having them ready to consult on your estate plan is critical.

Take Inventory

Before your first meeting with an attorney, get an inventory of the estate. This includes:

  • Assets
  • Investment accounts
  • Retirement accounts
  • Savings accounts
  • Insurance policies
  • Real estate and business holdings
  • Sentimental items
  • Collectibles
  • Debts owed by the estate

Think about the Critical Questions

You can streamline the estate planning process if you have some of the tougher questions already answered at your first appointment. These questions include:

  • Who should inherit your assets?
  • Who should be named as your guardian if you become incapacitated?
  • Who should be responsible for the execution of your will (i.e. the executor)?
  • Who should make financial and medical decisions if you cannot do so yourself?

Include the Essential Forms

You need the proper estate planning documents created to protect you and your estate. Your attorney will help decide which documents apply specifically to your case. Some that you can expect to file include:

  • Advance Healthcare Directive – This discusses all healthcare preferences, including your wishes for life-saving treatments, blood transfusions, oxygen, and resuscitation.
  • Power of Attorney – The power of attorney appoints someone who will handle your financial affairs if you become incapacitated. This party can be the same as the person named for your healthcare decisions, a professional, or a separate family member.
  • HIPAA Release Form – The HIPAA release form allows those named for your health care directive and the power of attorney to access any health information so that they may handle insurance and healthcare decisions on your behalf.
  • Will – Your will outlines your wishes, transfers assets to beneficiaries, and discusses funeral/burial wishes.
  • Living Trust – Instead of transferring assets through a will, which requires that assets go through probate, you can establish a living trust. All assets are then moved into the trust, and upon your death automatically transfer to beneficiaries named in the documents. These are faster and more flexible, but not always necessary. If you suspect that your will would be contested, it may be in your best interest to create a living trust.

Write Your Funeral or Memorial Instructions

Some people find this the hardest part of estate planning – addressing their death. While you could include funeral and burial wishes in your will, it is recommended that you also write them down elsewhere. The reason is that wills may not be opened until days or weeks after the funeral.

Tell friends and family members about your wishes regarding your funeral and burial preferences. Then, give everyone associated with it copies of your requests and store the original in a safe place. If you already purchased a cemetery plot, keep the documentation with the original instruction, provide a copy to your attorney, and tell family members where the location is.

Do Not Forget About Your Pet

Pets are companions and members of the family. Yet, they are often forgotten when it comes to estate planning. You can create wishes and instructions for your pet so that they are cared for too. Name a beneficiary for your pet, or give instructions for what shelter to send the pet to if you were to pass.

Also, choose a backup guardian for your pet in case the party initially named is unable to fulfill their duty.

Speak with an Estate Planning Attorney

Creating an estate plan when you are older is complicated and requires addressing long-term care and other financial matters. Therefore, it is best that you consult with an attorney who has experience handling elder care plans and estates.

Speak with an attorney today by calling the Law Office of Andrew M. Lamkin, P.C. You can schedule a free consultation now at 516-605-0625 or request an appointment online.

Are Probate Records Public Records?

Probate court is a legal process that follows a person’s death. It goes through various stages to help settle the estate, handle any outstanding debts, and distribute assets to named beneficiaries.

Probate records are public records. These include everything from a will to estate inventories, letters of administration, and any document related to the estate’s administration and settlement. These records also contain information on the deceased, identities of the heirs, and any legal actions associated with the estate. They are available via public databases through each state, and the courts are typically held by the state’s court archives.

What Types of Probate Records are Kept in Plainview, New York

Each state has a system for what records they keep and what can be accessed. In New York, the following probate records are part of the public search:

  • Surrogate Court Records: After May 1787, all county surrogate courts have their probate records on file. There is a complicated index for these records, and if you need to search, the surrogate’s court is usually the first place you will be directed to.
  • Probate Packets: Probate packets are the entire estate file. These have copies of the documents related to the estate’s settlement, including administration, inventories, and bonds.

How Do People Access Probate Records?

Receiving a copy of the deceased’s last will or other probate records is relatively easy because these are private documents available to the public. Probate files are part of the court record, and copies are available for a small fee. Sometimes you can access an entire person’s estate online – without a fee at all.

While you do not have access to the exact details of the will, you can review other documents including the name of the executor, heirs, attorneys of record, and the judge that oversaw the case. Some court records will also provide access to all names and contact information for creditors, beneficiaries, and allow copies of those documents.

What if I Do Not Want My Court Records Publicized

Unfortunately, the only way to avoid having your entire estate a matter of public record is to plan early on. Probate court is an open process, and anyone could review these records to determine how much your estate was worth – and some documents tell what beneficiaries inherited and how much. Because most people would rather keep their probate records private – and protect beneficiaries – the first step to avoiding this is to not go through probate.

Any time an asset is passed through a will, it is subject to probate. Probate is not only a hassle because your information is now public, but it is expensive and time-consuming – and entirely unnecessary for a modern estate.

Why Work to Avoid Probate?

Probate is expensive and lengthy. Therefore, your beneficiaries will not receive their inheritances right away, and probate courts typically cost five to 10 percent of the value of the estate assets. Some estates take up to one year to process through – and if there are any will contest they can take much longer.

You have designed an estate plan to protect loved ones and ensure they are taken care of; therefore, your last step is to help them avoid probate entirely.

If you think it is not an issue to have your estate a matter of public record, consider this: after probate is filed, any creditor can look up the estate and start petitioning the court for money. Therefore, the amount your beneficiaries receive can decrease even further. The process of fighting these claims will drain the estate and put an unnecessary burden on your loved ones as well.

You do not have to go through probate – so why bother?

Instead, you can speak with an attorney and work to avoid the entire hassle and cost of the probate process – and protect your loved ones.

Creative Tools that Are Effective in Avoiding Probate

No estate is required to go through probate, but to do that you must implement a variety of tools. Some of the more preferred ways to do this include:

  • Revocable Living Trust: This is the more popular method for avoiding probate. You establish a trust, control assets while alive, and then the assets are distributed probate-free upon your death.
  • Creating Beneficiary Deeds: A beneficiary deed is a real estate document that allows you to transfer property, like your family home, upon your death. The transfer takes place, and there is no reason for probate. You can send it to any jointly owned property, such as a home you share with your spouse.
  • Transfer Upon Death (TOD) Designations: You can also use the transfer-on-death designation through your personal property like vehicles, trailers, motorcycles, and other personal items. There are limitations on what property you can legally TOD; therefore, speak with an attorney.
  • Payable Upon Death: These designations are tied to financial accounts, such as life insurance, retirement accounts, and bank accounts. You can pick a beneficiary, and the institution that oversees the asset would automatically transfer upon your dearth.

Hiring an Attorney is the Best Option

If you truly want to avoid probate, you have a few options, but not all will apply to your situation. Therefore, the best place to start is by contacting an attorney in the area and exploring your options. An attorney, like the Law Office of Andrew M. Lamkin, P.C., will go over the options you have, your estate, and find the best way to transfer assets to loved ones all without becoming a public record in surrogate’s court.

Schedule a free consultation today by calling 516-605-0625 or request more information online.

How Aging Affects Memory – and What to Take Care of Now

Most people assume that it is natural to lose the ability to remember things as they get older. While memory loss does happen as part of the aging process, the intensity and how it affects you depends on the person and type of memory affected.

Also, not all memory loss is part of dementia or Alzheimer’s Disease. However, a vast majority of the more severe cases are. Therefore, it is essential that individuals and family members act early – including preparing an estate plan – before memory becomes a legal issue.

One Critical Flaw in Estate Plans Made in Plainview, NY

When a couple makes an estate plan, they often list a spouse as their beneficiary and sometimes the executor of their estate. They do this because at the time they draft their estate plan, both parties are of sound mind and have a legal capacity to do so. Unfortunately, years later one party could fall ill or suffer from a form of dementia, rendering them unable to fill their role. Without an alternate designated, the estate could find itself in court with parties battling to take over.

It is essential to plan, especially before memory loss or diseases like dementia take over. The sooner the estate planning starts, the more likely the person with the memory loss can participate and make decisions – and more likely the court is to honor those decisions.

Why Plan Now?

Making legal decisions, including an estate plan now, is essential for a few reasons:

  • Planning early allows for the individual to express their wishes and be involved in the planning – including designating future care.
  • Early planning will eliminate the stress of family members having to guess or make decisions on their loved one’s behalf.
  • Starting early ensures the estate has time to sift through the problematic legal procedures and financial issues that come with long-term care planning, end-of-life management, and estate distribution.

When older individuals start the planning process, they need to ensure that their estate plan includes the core components, such as:

  • Long-term care
  • Financial and property plans
  • Naming an agent and alternate agent

The Role of Capacity in Estate Planning

A person’s capacity plays a substantial role in estate planning. Once a person is legally incapacitated or cannot make decisions for themselves, they rely on documents pre-made in their estate plan to protect them. However, a loss of mental capacity can be quite subjective.

In situations where a person suffers an unexpected loss of capacity or has slowly diminished their capacity over time, the courts would consider the following factors:

  • Can the individual remember details?
  • Does the individual act out of character compared to the typical demeanor?
  • Can that party recognize family members?
  • Does the individual suffer from constant confusion and decreased attention?
  • How difficult is it for the person to speak or follow through in a conversation?
  • Is there a decreased appreciation for risks?

If a person fails the capacity test, then the courts may deem them incapacitated.

If a person is considered incapacity before they finished an estate plan, the documents and decisions they made will be subject to court scrutiny, and the final will could be disregarded entirely.

Therefore, attorneys urge their clients to start the process early. Dementia, Alzheimer’s Disease, and other memory-affecting conditions can strike without notice, and by the time the symptoms are recognized, it could be too late to create an estate plan.

How an Attorney Can Help

While certain documents could be completed without an attorney, it is best to consult one if you suspect that your mental capacity is declining, or you were recently diagnosed with Alzheimer’s Disease. Getting legal advice and services from a local estate planning attorney can be helpful, especially in complicated cases just like this.

Your attorney will discuss the key issues that come with a diagnosis just like this, such as:

  • Your options for health care decisions and which party will make health care decision on your behalf.
  • Your options for managing the property and personal care – and if you will have a separate party designated for that role.
  • Your potential options for long-term care coverage, including veteran benefits, Medicare, or Medicaid qualifications.

5 Essential Tips for Better Planning with Memory Loss

It does not matter how severe the memory loss is now, or whether you suffer from forms of memory loss at all. The more prepared you are, the easier it will be for family members to help you, but also protect you from the endless scams out there that target aging individuals specifically.

Some key things to keep in mind while you work on a plan include:

  • Hand Out Copies: Anyone you give a power of attorney designation to should have a copy of the document as well as access to the original – whether that means access to a safe deposit box or a code to an in-home safe.
  • Name a Successor: No matter what the situation is, you need to provide a backup agent or successor to the original power of attorney. That way, if the original party cannot fulfill his or her duty, you have an alternative that was selected by you.
  • Brain Autopsy: Some individuals may want a brain autopsy to identify what caused their dementia or to donate for research. If this is something you want to do, you will need to ensure the power of attorney with health care decision-making power does this.
  • Health Care Providers: Give a copy of your living will to your health care providers so that they know which parties are authorized to make decisions.
  • Attorney: Consider hiring an attorney to manage your estate if you do not have someone that you trust to handle the assets and personal finances.

Speak with an Attorney Regarding Your Care

Avoid the hassles of waiting until the last minute and speak with an attorney about your long-term care planning, wishes, and more today. Contact the Law Office of Andrew M. Lamkin, P.C. now for a free estate planning consultation at 516-605-0625 or request more information online.