Finance & Law

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By Nancy Burner, Esq.

Nancy Burner, Esq.

Many people use irrevocable trusts as part of their estate plan for tax savings, asset protection and Medicaid planning. In all these types of trusts, the grantor (creator) of the trust is going to be limited to their access of the principal of the trust in order to ensure that their planning needs are met. This means that their ability to use trust assets as collateral for a loan is going to be limited. 

A concern that should be discussed before transferring real estate to an irrevocable trust, is whether or not you 1.) have an existing mortgage and plan to refinance in the near future and 2.) whether you think you may need to get a new mortgage or line of credit in the near future?

It is common, particularly in Medicaid planning, to transfer real estate to your irrevocable trust because Medicaid trusts typically provide that the grantor can reside in the property and shall maintain all tax exemptions formerly afforded to them. This makes the home an easy asset to protect since the transfer does not affect everyday use of the property. The biggest exception is the Grantor’s ability to refinance or secure new mortgage products once the property is in a trust since many banks will not lend to properties owned by an irrevocable trust.

While most irrevocable trusts do not expressly prohibit the Trustee from securing a mortgage with a trust asset, the loan industry’s underwriting guidelines typically do not allow it. 

Luckily, some banks are catching up with the times and have special products which can be secured against properties in irrevocable trusts. However, you should expect to pay higher interest rates.

If your preferred lending institution will not work with your property in the trust, then it may be possible to revoke the trust with the consent of the grantor and beneficiaries. However, once a trust is revoked, it will no longer afford you the planning goals it once did.
In other words, if your house was in a Medicaid Trust for 7 years and you revoke it to avail yourself to the low interest rates now available for mortgages, it will no longer be protected. The home would have to be placed in another Medicaid trust for an additional 5 years before it would be protected again should you require nursing home care and ask that the Medicaid program pay for said care. 

Always speak to your attorney before taking any asset out of an irrevocable trust. While everyone wants to pay the lowest interest rate possible, the protection you are getting by keeping the assets in the trust may outweigh the cost savings. If beneficiaries will not consent, or cannot consent due to death, disability or minority, the Trustee may be able to “decant” the irrevocable trust assets to a new trust with different terms which the bank may find more favorable. Decanting requires a Trustee who is not an interested party, so if the current Trustee is also a beneficiary, a new Trustee will need to be appointed. 

Decanting has become popular in recent years not only for amending trusts to please the lenders, but to fix a myriad of issues that older trusts may present. This is a specialized area of the law and you should seek counsel that is familiar with sophisticated trust and estate principles before transferring any asset from one trust to another.

In sum, transferring your property to an irrevocable trust will likely limit your choices for refinancing or mortgaging the property in the future. If this is something you are considering, speak to your attorney about obtaining financing before you transfer your house to the trust to avoid the hassle later.

Nancy Burner, Esq. practices elder law and estate planning from her East Setauket office. 

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By Linda Toga, Esq.

Linda Toga

THE FACTS: Just before my husband died we adopted a puppy we named Morris. Morris is a great source of comfort and joy and I cannot imagine being without him. My concern is that something may happen to me that makes it difficult or impossible for me to care for Morris. Although my children live close by, I cannot depend on them to care for Morris because of allergies and their living arrangements. My friends told me that I should include a pet trust in my will so that Morris’s needs will be met but, I understand that the provisions in my will will have no bearing on Morris’ care until I die and my will is admitted to probate.

THE QUESTION: What can I do to make sure Morris will be cared for in the event I am disabled or simply cannot take care of him any longer? 

THE ANSWER: To insure that Morris is cared for despite your inability to take care of him yourself, you should create an intervivos pet trust. An intervivos pet trust becomes effective as soon as it is executed and funded in contrast to a pet trust that is included in your will. The latter will not address Morris’s needs during your lifetime. 

In the pet trust you need to name the pet or pets that you want to benefit from the terms of the trust. If Morris is your only pet and you do not have plans to get another pet, you can name Morris as the sole beneficiary of the trust. People who have more than one pet or who expect to have other pets during their lifetime may want to identify the beneficiaries of the trust as “any and all pets” they may have at the time the provisions of the trust are triggered. Generally, the terms of a pet trust are triggered when the pet owner’s health deteriorates to the point that the caregiver must assume responsibility for the pet’s care. Triggering events may include your illness, disability (either permanent or temporary) and your death.  

In addition to naming the pets who are to benefit from the provisions of the trust and the events that will result in Morris’s care being taken over by the caregiver, you need to name the person or persons who will be Morris’ caregiver. Be sure to name a successor caregiver in case the caregiver you name is unable to deal with Morris when the need arises. Before naming a caregiver, you should ask each potential caregiver if she is willing to take on the responsibility of caring for Morris. It is important to discuss with all potential caregivers whether their living arrangements can accommodate your pet, whether they or the people they live with have any health issues that may be adversely impacted by the presence of your pet and whether caring for Morris will be an undue burden, financially or otherwise. 

You should plan on funding the pet trust with enough money to cover Morris’s anticipated expenses for the rest of his life. Doing so will alleviate any financial burden on the caregiver However, money will not necessarily alleviate the burden created by the time and effort needed to feed and walk Morris and to get to him the vet and/or groomer as needed. Make sure the caregiver you chose understands exactly what is involved in caring for Morris. You should not assume that everyone will be willing and/or able to give Morris the care and attention he has grown accustomed to. 

Your pet trust should address what will be done in the event you are temporarily unable to care for Morris, as well as what will be done if your health deteriorates to the point that you can no longer care for him at all. Obviously, the trust should also provide guidance as to Morris’s care after your death and your wishes with respect to Morris’s burial or cremation. 

In the trust you should set forth any special needs that Morris may have in terms of diet, grooming or medication. You should also provide the names and contact information for the people who have been treating and grooming Morris. If you want Morris to be groomed monthly, state that in the trust. If you want Morris to be fed a special diet, state as much in the trust. The more information you can provide the caregiver, the more likely it is that Morris will be taken care of in accordance with your wishes. 

With respect to how much money to put into the trust for Morris’s care, you need to consider his age and current physical condition, as well as what you have historically paid for his care. Although you don’t want to set aside too much money, the trust should be funded with sufficient assets to cover routine expenses as well as expenses that will arise when Morris dies. You can indicate in the trust what will happen to the funds that may remain in the trust once Morris is gone. Many people have those assets pass to the caregiver in recognition of their service but, some people opt to have the funds pass to a charity that provides services to abandoned pets. 

There are clearly a lot that goes into the creation of a pet trust for a beloved pet like Morris. It is, therefore, important to seek the expertise of an attorney with experience in creating pet trusts since they are in the best position to insure that all of the important issues that should be addressed in the trust are, in fact, addressed. 

Linda M. Toga, Esq. provides legal services in the areas of estate planning and administration, real estate, small business services and litigation from her East Setauket office. Visit her website at www.lmtogalaw.com or call 631-444-5605 to schedule a free consultation.

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By Nancy Burner, Esq.

Nancy Burner, Esq.

While the beginning of the year is typically tax season, it is important to remember that property tax exemptions can be applied for at this time. There are different programs that homeowners should be aware of in order to potentially save with respect to property taxes. 

Most individuals are familiar with the STAR program, which is the New York State School Tax Relief Program. Another program that people may not be as familiar with is the exemption for persons with disabilities. New York State offers local governments and school districts the ability to opt into a grant reduction on the amount of property taxes paid by qualifying persons with disabilities.

The eligibility requirements for this exemption is based on the individual’s disability, income, residency and ownership. For the disability component, the individual must demonstrate a physical or mental impairment that substantially limits the person’s ability to engage in one or more major life activity (e.g., walking, hearing, breathing, working). The applicant must submit proof of disability via an award letter from the Social Security Administration, an award letter from the Railroad Retirement Board, a certificate from the State Commission for the Blind and Visually Handicapped, an award letter from the U.S. Postal Service or an award letter from the U.S. Department of Veterans Affairs. 

If the disability is not permanent, the applicant will be required to certify the disability each year. For the residency requirement, the property must be the “legal residence” of the disabled person and currently occupied by the disabled person. There is an exception for absence due to medical treatment. For the ownership requirement, all property owners must be disabled. The only two exceptions are for spouse- or sibling-owned property. In those cases, only one owner needs to be disabled.

With respect to the income eligibility, the basic exemption is a 50 percent reduction in the assessed value of the legal residence. New York State allows each county, city, town, village or school district to set the maximum annual income limit at any figure between $3,000.00 and $29,000.00. If the disabled person makes between $29,000.00 and $37,399.99, the localities can give a less than 50 percent exemption based on a sliding scale. Proof of income of the most recent tax year is required to be submitted with the application. 

All income sources are countable except Social Security Income (SSI), Foster Grandparent Program Grant monies, welfare payments, inheritances, return of capital and reparation payments received by Holocaust survivors. Certain medical expenses can be used to offset gross income. For example, medical and prescription drug expenses that are not reimbursed or paid by insurance may be deducted from total income. 

Additionally, if the owner is an inpatient in a residential health care facility, the monies paid by the owner, spouse or co-owner will not be considered income in determining the exemption eligibility. Each municipality may be more generous with the exception than others.

Finally, even if all requirements are met, if there are children living in the home and attending public school, the disabled owner is typically not eligible for the exemption. This can be waived by the school district under specific circumstances.

New York State sets out broad eligibility requirements that each municipality can narrow down. It is important to find out the exact requirements for your specific municipality to determine if you qualify for the exemption. The exemption for persons with disability can offer a substantial relief for those who qualify.

Nancy Burner, Esq. practices elder law and estate planning from her East Setauket office.

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By Nancer Burner, Esq.

Nancy Burner, Esq.

The new Setting Every Community Up for Retirement Enhancement (SECURE) Act, effective Jan. 1, 2020, is the broadest piece of retirement legislation passed in 13 years. The law focuses on retirement planning in three areas: modifying required minimum distribution (RMD) rules for retirement plans, expanding retirement plan access and increasing lifetime income options in retirement plans. This article will focus on the modifications to the RMD rules and their effects on inherited individual retirement accounts. 

Before the SECURE Act, if you had money in a traditional IRA and were retired, you were required to start making withdrawals at age 70½. But for people who have not reached age 70½ by the end of 2019, the SECURE Act pushes RMD start date to age 72. By delaying the RMD start date, the SECURE Act gives your IRAs and 401(k)s additional time to grow without required distributions and the resulting income taxes.

Since RMDs will not start until age 72, the new law will give you an additional two years to do what are known as Roth IRA conversions without having to worry about the impact of required distributions. With a Roth IRA, unlike a traditional IRA, withdrawals are income tax-free if you meet certain requirements and there are no RMDs during your lifetime. The general goal of a Roth conversion is to convert taxable money in an IRA into a Roth IRA at lower tax rates today than you expect to pay in the future.

The SECURE Act also removed the so-called “stretch” provisions for beneficiaries of IRAs. In the past, if an IRA was left to a beneficiary, that person could stretch out the RMDs over his or her life expectancy, essentially “stretching” out the tax benefits of the retirement account. But with the SECURE Act, most IRA beneficiaries will now have to distribute their entire IRA account within 10 years of the year of death of the owner. 

There are, however, exceptions to the 10-year rule for the following beneficiaries: surviving spouse, children under the age of majority, disabled, chronically ill and an individual not more than 10 years younger than employee. 

The SECURE Act means it is now very important to review the beneficiary designations of your retirement accounts. You want to make sure they align with the new beneficiary rules. Prior to the SECURE Act, a spousal rollover was generally the best practice to preserve the IRA. For many with large retirement accounts, it may now be better to begin distributing the IRA earlier in order to minimize exposure to higher tax brackets. It may also be beneficial to name multiple beneficiaries on an IRA to spread the distributions to more taxpayers, so the 10-year rule has less of an impact on the beneficiary’s income tax bracket. 

Prior to the SECURE Act, many people used trusts as beneficiaries of retirement accounts with a “see-through” feature that let the beneficiary stretch out the tax benefits of the inherited IRA account. The benefit of the trust was to help manage the inherited IRA and to provide protection from creditors. 

However, many of these trusts provided the beneficiary with access to only the RMD. With the new rule that all money must be taken out within 10 years, these trusts no longer have the same effect and could be troublesome, requiring that significantly more money be distributed to the beneficiary annually than initially intended. In addition, the trust funds would likely be exhausted after 10 years rather than providing funds to the beneficiary over his or her remaining life expectancy. 

Anyone with a trust as the beneficiary of an IRA should immediately review the trust language with an experienced estate planning attorney to see if it still aligns with his or her intended goals. 

If you are not sure what the new SECURE Act means for your retirement account, you should also contact an experienced estate planning attorney to review your beneficiary designations. 

Nancy Burner, Esq. practices elder law and estate planning from her East Setauket office.

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: My husband Joe and I own our house jointly. In addition to our joint checking account, Joe has a savings account with a balance of about $100,000. Joe suffers from advanced dementia and his health is failing. I do not know how much longer he will be able to live at home with me. I anticipate needing to apply for Medicaid down the road. I understand that Joe is more likely to be eligible for Medicaid if his assets are transferred to me. 

THE QUESTION: As his spouse, can I simply transfer Joe’s assets into my name?

THE ANSWER: Unfortunately, you do not have the authority to transfer Joe’s assets to yourself unless Joe has a power of attorney in which he names you as his agent and gives you authority to make gifts to yourself. Without the benefit of a power of attorney that includes a statutory gifts rider, you have no more authority to transfer Joe’s assets to yourself than a stranger would have.

Even though you and Joe own your home jointly, both you and Joe would need to sign a deed to transfer the property to you alone. If Joe’s dementia is advanced, there is a chance that he lacks the capacity to sign a deed. To find out if that is the case, you and Joe should talk to an experienced estate planning attorney. After speaking to Joe, the attorney should be able to tell you whether Joe has the requisite capacity to sign a deed. 

If the determination is that Joe lacks capacity, the only other option you have to transfer the property is to be appointed as Joe’s guardian in the context of a costly and time-consuming guardianship proceeding. 

Just as Joe’s interest in your house cannot be transferred to you without Joe taking action, the funds in his savings account cannot be removed without Joe’s active participation. Unless you are Joe’s agent pursuant to a valid, enforceable power of attorney or his legal guardian, Joe’s signature will be needed to close the account.

Fortunately, that is not the case when it comes to your joint account. You need not be Joe’s agent or his guardian to transfer the funds in the joint bank account to yourself. That is because joint account holders each have an ownership interest in the funds in a joint account. As such, any joint owner can either close that account or reduce the balance in the account to a negligible amount. If you close that account and put the funds in your name, the transfer will not be deemed a gift and the funds will be deemed not available to Joe in the context of his Medicaid application. 

Even if it is too late for Joe to sign a power of attorney giving you authority to handle his affairs and make gifts to yourself, it is not too late for you to delegate authority to an agent of your choice to handle your affairs down the road. To ensure that any power of attorney you sign is tailored to your needs, I urge you to retain an attorney who practices in the area of estate planning to explain in detail the current power of attorney and the various types of transaction and activities you may want to delegate, and to prepare for you a new power of attorney that reflects your wishes. 

Linda M. Toga, Esq. provides legal services in the areas of estate planning and administration, real estate, small business services and litigation from her East Setauket office. Visit her website at www.lmtogalaw.com or call 631-444-5605 to schedule a free consultation.

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By Nancy Burner, Esq.

Nancy Burner, Esq.

Married couples often share everything. They can have joint assets including real estate, checking and savings accounts and brokerage accounts. However, there are assets that cannot be held in joint names. 

While a retirement account or life insurance policy can name the spouse as beneficiary, the owner is usually just one person. Therefore, if the nonowner spouse needs to contact the institution that holds the policy or account on behalf of their spouse, they will run into a roadblock if they do not have any legal authorization to do so. The mere fact that you are a spouse does not give you access to this information. 

It is for these types of assets that one spouse will need a power of attorney for another. This document states exactly what powers one person, the “principal,” is allowing another, the “agent,” to have over their affairs. If the power is not specifically included in the document, the agent cannot act on it. If the spouse is named as agent, it is often advisable to name a second and/or third person to act as successor agent if your spouse is unable to act. 

Beyond accessing certain assets, the power of attorney document can allow the agent to step into the shoes of the principal and act on his behalf in other instances. If the powers are properly granted, the agent can create and fund a trust for the principal, sign contracts, access safe deposit boxes, give charitable gifts, engage in Medicaid planning and so on.  

While signing a power of attorney in the presence of a lawyer is not a requirement, it is a good idea. The power of attorney document gives the option of attaching a contemporaneously signed statutory gifts rider. The document itself says that the preparation of the rider should be supervised by an attorney. In the rider, the principal is giving the agent authority to transfer assets out of the principal’s name. Any such transfers must be in the best interest of the principal.

The power of attorney is a complicated document that can have an extreme impact on your life as it is giving another person the ability to access your accounts and confidential information. This is an important document to have in the toolbox as one ages but only if you understand and feel comfortable with the powers being granted. For this reason, it is advisable to seek the counsel of an experienced elder law or estate planning attorney to explore the different scenarios in which your spouse may need to have power of attorney over your affairs.  

Nancy Burner, Esq. practices elder law and estate planning from her East Setauket office.

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Linda Toga, Esq.

THE FACTS: My grandson Frank is disabled and will likely need medical and financial assistance as an adult. I would like to name Frank and my other grandchildren as beneficiaries in my will, but I am concerned that doing so may make Frank ineligible for government assistance programs. 

THE QUESTION: How can I leave Frank money without interfering with whatever government benefits he may be receiving at the time of my death? 

THE ANSWER: The best way to provide financial support to Frank without making him ineligible for needs-based government benefits like Medicaid and Section 8 housing assistance is to direct your executor to put Frank’s bequest in a supplement needs trust, (SNT). 

An SNT is designed so that the trustee can use trust assets to supplement the government benefits that the disabled beneficiary may be receiving. Trust assets can be used to enhance the life and well-being of the beneficiary. They cannot, however, be used to pay for goods and/or services provided to the beneficiary by the government. 

For example, the trustee may pay for a disabled beneficiary’s cellphone, car or vacation but cannot pay for medical treatment if the beneficiary is receiving Medicaid. Similarly, if the beneficiary’s housing costs are covered by a needs-based government program, the trustee can use the trust asset to furnish an apartment but cannot pay the rent. 

As mentioned above, in your will you can direct your executor to fund a testamentary SNT that will be administered by a trustee of your choosing. In the alternative, you can create and fund an SNT for Frank during your lifetime. One advantage of this approach is that other family members can then contribute to the SNT either directly or by a bequest in their own wills. In either case, Frank will benefit from your generosity because rather than his inheritance being used for necessities, the trust assets can be used for things that will enhance his life, make him more comfortable and make each day more enjoyable. 

To create an SNT, you should contact an attorney who has prepared trusts in the past and who has experience working with clients concerned about the future of their disabled beneficiaries. 

Linda M. Toga, Esq. provides legal services in the areas of estate planning and administration, real estate, small business services and litigation from her East Setauket office. Visit her website at www.lmtogalaw.com or call 631-444-5605 to schedule a free consultation.

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By Nancy Burner, Esq.

Nancy Burner, Esq.

If you are the beneficiary of an estate or trust and you think that the fiduciary or person in charge is not meeting their obligations, there are procedures in which they can be removed. Surrogate’s Court Procedure Act SCPA §719 lists several grounds upon which a fiduciary can be removed. The grounds are straightforward and include when the fiduciary refused to obey a court order, the fiduciary is a convicted felon, the fiduciary declared an incapacitated person or the fiduciary deposits assets in an account other than as fiduciary of the estate or trust. 

However, many situations are not as straightforward as the grounds listed in SCPA §719. While you may be working with a fiduciary that does not act in the manner that you wish, oftentimes, the conduct does not rise to the standard that would warrant their removal. 

 Courts have held that the removal of a fiduciary pursuant to SCPA §719 is equivalent to a judicial nullification of the testator’s choice and can only be done when the grounds set forth in the statutes have been clearly established. The court may remove a fiduciary without a hearing only when the misconduct is established by undisputed facts or concessions, when the fiduciary’s in-court conduct causes such facts to be within the court’s knowledge or when facts warranting amendment of letters are presented to the court during a related evidentiary proceeding. 

Pursuant to SCPA §711 a person interested may petition the court to remove the fiduciary. Some of the grounds listed in the statute include: the fiduciary wasted or improvidently managed property; the fiduciary willfully refused or without good cause neglected to obey any lawful direction of the court; or the fiduciary does not possess the necessary qualifications by reason of substance abuse, dishonesty, improvidence, want of understanding or who is otherwise unfit for the execution of the office. Again, while there are many cases where fiduciaries have behaved badly, courts are generally hesitant to remove fiduciaries unless the assets of the estate/trust are put at risk. 

Even though you may be unhappy with the conduct of a fiduciary, not every breach of duty will result in the removal of the fiduciary. Many breaches can be addressed in an accounting proceeding either through surcharge or denial of commissions. While a fiduciary can be removed if conduct that violates SCPA §711 or §719 can be proven, it is often a lengthy and expensive process that involves the exercise of discretion by a court that is hesitant to remove a fiduciary chosen by the testator. 

A proceeding to remove a fiduciary should only be undertaken if it can be proven that the assets of the estate/trust are in danger under the fiduciary’s control. Mere speculation or distrust will not be enough to remove a fiduciary. If you believe that the fiduciary of an estate or trust is not managing the estate or trust properly, you should consult with an attorney experienced in estate administration matters that can review the facts and determine the best course of action. 

Nancy Burner, Esq. practices elder law and estate planning from her East Setauket office. 

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By Linda Toga, Esq.

Linda Toga, Esq.

THE FACTS: My brother Joe died recently. At the time of his death, Joe was living in a house that has been in the family for generations. When my father died, Joe inherited the house. It was understood that he would eventually pass it on to me, his only surviving sibling, or to his children so that it would remain in the family. Instead, Joe has left the house to a woman with whom he has been living for the past five years. She has no relationship with the family.

THE QUESTION: Can Joe’s children and I contest the will to prevent the house from passing to a nonfamily member?

THE ANSWER: Whether a person can object to the probate of a will depends on two factors: whether the person has standing (the legal right to object to the probate of the will) and whether the person has a legal basis for objecting. 

A person has standing to object to a will only if the person would inherit from the estate if there was no will. That, in turn, depends on the relationship between the person and the decedent and whether there are people alive whose relationship with the decedent takes priority. 

The intestacy statute, which governs how an estate is distributed when a person dies without a will, sets forth the classes of people who are in line to inherit in their order of priority. Since Joe’s children are alive and have priority over you under the statute, they have standing to object to the probate of the will but you do not.

As for a basis for objecting to probate, there are three grounds for challenging the validity of a will. They are improper execution of the will, undue influence over the testator and lack of testamentary capacity. 

If the execution of the will was supervised by an attorney, there is a presumption that the required formalities were followed. However, if the will was not signed by the testator in the proper place in the presence of suitable witnesses who were advised that they were witnessing the execution of a will, that presumption can be rebutted. The issue of improper execution is more common when there is no supervising attorney present when the will is signed. 

Unlike improper execution, the other grounds for challenging the validity of a will, undue influence and lack of capacity, both address the mental fitness of the testator. Undue influence may exist when the testator is easily manipulated or persuaded by someone who pressures the testator to make certain bequests. 

Lack of testamentary capacity may be established with proof that the testator was notably confused about and/or unaware of what he owned, who his relatives might be and/or the consequences of the bequests made in his will. Both undue influence and incapacity are difficult to prove, especially if years have passed between when the will was executed and when it is offered for probate. 

If Joe’s children suspect that any of the grounds for a will contest that are discussed above exist, they should consult with an attorney with experience in estate litigation. The attorney should be able to evaluate the situation and give them some sense of whether they should proceed with a will contest. 

Linda M. Toga, Esq. provides legal services in the areas of estate planning and administration, real estate, small business services and litigation from her East Setauket office. Visit her website at www.lmtogalaw.com or call 631-444-5605 to schedule a free consultation.

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Nancy Burner, Esq.

By Nancy Burner, Esq.

Losing a spouse is an extremely difficult time in life and handling the administration of their estate can be a stressful experience. When you are ready, it is important to seek the advice of an estate planning and elder law attorney to discuss what needs to be done on behalf of your spouse’s estate and also what planning you need to do for your own estate.

Your attorney will want to review all assets held by your spouse, whether individually or jointly with you, and all assets in your name. It is also important to review any previous estate planning documents you may have in place, such as last will and testaments, trusts, powers of attorney and health care directives. A thorough review of the assets and estate planning documents will help your attorney advise you on what additional planning, if any, needs to be done.

If your spouse was the owner of an IRA or other tax deferred retirement account, you are likely named as the primary beneficiary on the account. You will want to ensure that you roll over this account into an IRA account in your name. It will also be necessary for you to put your sole name on any accounts that are held jointly with you and your spouse or that name you as transfer on death beneficiary.

Furthermore, it is important you update the beneficiaries under these accounts where appropriate, especially if your spouse was previously listed as your primary beneficiary. 

You will need to go through a court process to gain control of assets held in your spouse’s sole name without a beneficiary.  The court proceeding is called “probate” if your spouse had a last will and testament or “administration” if your spouse died without a last will and testament. New York State law provides a scheme for the distribution of assets in the case of a person that did not execute a last will and testament.

If your spouse had children, you and the children will share in the assets of the administration estate. There are also certain rights that a surviving spouse has to assets of the estate about which your attorney can advise you.

Lastly, a review of your current estate planning documents will help determine if updates to your plan are required. For example, you will likely need to change your agents listed under your power of attorney and health care proxy if each document listed your spouse as agent.

Additional changes to your will and/or trust may be required if there are changes to the tax law, your family structure or personal health status, such as a need for long-term care.

Nancy Burner, Esq. practices elder law and estate planning from her East Setauket office.