Estate Planning In New York

You can save a lot of money, potential chaos and hard feelings between those closest to you by preplanning how you want your assets managed when you are now longer able to manage them yourself, and how your property will be divided at your death.

Powers of Attorney

In New York, you can sign a "springing power of attorney" to appoint someone to handle your assets if you become incapacitated. At a minimum, a power of attorney should include the power to:

• Manage and transfer all assets
• Deal with the IRS
• Make gifts on your behalf
• Create and amend any trusts you set up

You don't need to transfer any assets at the time you sign a springing power of attorney , but it's a good idea to keep the person you've chosen informed about your ongoing financial matters.

You can also appoint a Health Care Proxy to make health care decisions for you when you're unable to do so yourself. This person can provide informed consent for treatment, or even refuse treatment for you.

Dying Without A Will

If you die without a will (known as dying "intestate") in New York, your assets will be divided amongst your immediate family. If you have a spouse but no children, your spouse inherits everything. If you're survived by a spouse and children, your spouse will take the first $50,000 and one-half of the balance of the property, with your children inheriting the rest.

If you have children, but no spouse, your living children each receive an equal share, with the children of any of your predeceased children dividing up their parent's share.

If you have no spouse or children or grandchildren, your parents (or their descendents such as your siblings or nieces and nephews) will inherit everything.

Alternatives To A Will

Wills eventually become public after your death, with the details of what you owned and how much it was worth available to anyone curious enough to read the court file. So many people look for more private ways to transfer their assets.

In New York, alternatives to making a will include:

• Life insurance policies or trusts
• Gifting cash or other assets before your death
• "Payable On Death" ("POD") bank accounts
• Holding assets by "joint tenancy ," with the assets transferring automatically to the other joint tenant at the time of death
• Retirement plans and Individual Retirement Accounts ("IRAs")
• "Revocable living trusts," giving all your assets to a trustee for management before your death

Making A Will

To make a valid will in New York, you must be at least eighteen years old and of "sound mind and memory." The will must be witnessed by two adult witnesses who understand it's a will and won't be beneficiaries. You can file the original with the Surrogate's Court in your county, or keep it in your attorney's safe. It's a good idea to keep a copy somewhere where it can easily be found by the person who will be processing your estate, called the "executor."

A New York lawyer who does a lot of estate planning can explain the consequences of some of the most basic choices you must make, such as whether property you want to leave to your minor children should be put into a trust at your death. For that reason, it makes sense to consult with a New York estate planning lawyer and have him or her draft your will, so that you don't make costly mistakes or accidentally not accomplish what you intended.

Providing For Young Children

There are many kinds of trusts, but the most common is one you would set up for your minor children or incapacitated adult relatives for their care after you are gone and until they are old enough or well enough to take care of themselves. A parent can name a trustee to be in control of the finances and decide whether to sell or keep property, and manage assets such as real estate. The trustee, usually a family member or trusted friend, can be paid an hourly rate or a set monthly amount for their services out of the trust assets.

You will probably also want to name a guardian for your children, someone who would have physical custody of and take care of your children on a daily basis should you or your spouse be unable to do so.

Probate

"Probate" is the public process of:

• Filing and validating a will in court
• Paying all the debts and taxes of the deceased person
• Dividing up the assets according to the will or New York law

Even if you have less than $20,000 in assets and die without a will, your estate will still need to go through an administration process in court .

Probate lawyers generally charge by the hour, and make sure everything gets processed according to the law.

Related Web link:

New York Health Care Proxy and Living Will Forms

New York Durable Power Of Attorney Form

New York Estates, Wills and Probate Message Board for more help