NY estate planning attorney Albert Goodwin is committed to helping seniors meet the challenges of getting older. As a senior, your income may have declined when you stopped working, but your medical and living expenses are soaring. You are gradually becoming more vulnerable and more dependent on others. Depending on the state of your health, you may need a home health aide or to be in a living facility. You are worried if you will have enough money to maintain your lifestyle and if there will be anything left for your family.
Estate planning attorney Albert Goodwin can help you maintain a comfortable lifestyle while preserving your wealth for the next generation of your family.
If you don’t have a will, then the court will distribute your property according to NY’s intestacy laws. Your estate would still be divided only among your relatives, and the proportions of the distribution will most likely be different than what you would have wanted. You will lose the opportunity to leave out some of your relatives, and children may gain access to large sums of money upon turning 18.
Without a Valid Will Made by an Estate Planning Attorney, Your Family Would “Inherit” Attorneys’ Fees, Estate Taxes, Confusion and Feuds
If you leave behind a business, real estate, or financial papers which it would be a loss to sell at the current market conditions, the court might force your estate to sell such an asset. If you leave behind an asset that requires management, the court might direct your heirs to jointly manage the asset, without defining each heir’s role. Such co-ownership often results in feuding over money and control, which leads to years of litigation and tens of thousands of dollars spent on lawyers.
An estate planning attorney can help you make a will, letting you select who will serve as your executor (the person who handles your estate). You would choose someone that you trust, probably a relative and someone who is familiar with your property. Without a will, the family might disagree with whom the court should appoint as an executor, which may result in feuding and probate litigation.
Making a will is a good time for tax planning, saving your heirs tens of thousands of dollars in estate taxes. It is also a good time to calculate your estate tax liability and make sure that your estate has liquid assets to satisfy estate taxes. Otherwise, the probate court will force your heirs to sell a part of their inheritance to pay for estate taxes.
A trust can provide various important benefits to a senior – get Medicaid, protection from creditors, avoid probate, maintain privacy, avoid multiple-state legal proceedings, avoid interruption of income and use of assets, provide planning for mental disability, and save money on estate taxes, and many other benefits.
A Charitable Remainder Trust (CRT) or a Charitable Lead Trust (CLT) will help you maximize your tax advantage per charitable dollar. A Grantor Retained Annuity Trusts (GRAT), an Intentionally Defective Grantor Trusts (IDGT), or a Unitrust are advanced trusts that remove appreciation of your property from your estate. Read more in Advanced Estate Planning.
A revocable trust does not offer enough protection to be considered a good asset protection tool. The law considers assets in the revocable trust to belong to the person who placed the asset into the trust, so forming an irrevocable trust, although it has some benefits, will have no impact on asset protection. This is because revocable trust gives a lot of control to the person who established the trust. You can even revoke the trust, reversing it completely. For this reason, only an irrevocable trust works as a tool that an estate planning attorney would use in NY. However, a NY estate planning attorney would still use revocable trusts for a number of situations. Revocable trusts are flexible because you can change or revoke them any time you like and for any reason. A revocable trust becomes irrevocable after the death of the person who made it, making it a flexible option but at the same time offering many of the trust benefits outlined above.
An Irrevocable Life Insurance Trust (ILIT) can be set up to own the life insurance policy, so that when the insured person dies, the proceeds of the life insurance will not become a part of the taxable estate. The insured can still pay the premiums by a “Crummy gift” to the trust. The downside of the trust is that the trust cannot be changed since it is irrevocable. The upside – no estate taxes (if set up the right way).
A Life Insurance Trust is also an important estate planning tool. It holds your life insurance for the benefit of your beneficiaries. After three years the trust would be deemed the owner of the policy, so as to minimize and chance that your estate will pay estate taxes on the proceeds. It also ensures that any appreciation of the life insurance policy is kept out of your estate. As a note of caution, a Life Insurance trust has to be carefully drafted by an experienced NY estate planning attorney to meet exacting IRS requirements.
Power of Attorney
A Power of Attorney is a legal document in which you give another person legal authority to act on behalf of the senior. A senior can select someone they trust, like their child, to be their “agent”. A revocable power of attorney makes sure that you can change your agent at any time.
If you do not have a power of attorney, your family might have no choice but to ask the court to appoint a guardian to make medical or financial decisions on your behalf. This procedure can be expensive and time-consuming and may result in the court appointing someone that you might not have wanted to make financial decisions on your behalf.
An estate planning attorney will prepare a Living Will, which determines what life-sustaining measures if any, you wish to be taken in case you will not be able to direct the doctors. For example, do you want to leave a do not resuscitate (DNR) instruction? Does your religion dictate a preference? What do you want to happen to your organs? These and many other issues are addressed by your estate planning attorney in your living will.
An estate planning attorney will prepare a Health Proxy is a document that specifies the person that you would like to make health decisions for you when you are not able to do so yourself. A Health Care Proxy is a power of attorney for healthcare decisions.
If you need a NY estate planning attorney to help you maintain a comfortable lifestyle while preserving your wealth for the next generation of your family, call Albert Goodwin at (212) 233-1233 or 212-233-1233.