LAST WILL AND TESTAMENT
Your Last Will and Testament (will) is a legal document that directs how you wish to dispose of your property, both real and personal, after your death. The primary reason for making a will is to leave your property to those you care about, and in the proportions you choose. If you do not have a will, those assets which would otherwise pass under your will instead will be distributed according to New York State’s Laws of Intestacy.
If you die without a will, the property in your name in most instances will be distributed among your family members, and perhaps not in the way you would prefer. If you are survived by a spouse and descendants, your spouse would take the first $50,000 plus one-half of the balance of the property, and your descendants would share the rest. If you are survived by a spouse but no descendants, your spouse would take all. If you are survived by descendants but no spouse, your descendants would take all. There are specific laws which dictate how property passes when there is no will. A will is essential if you want to leave assets in any manner not consistent with the laws of intestacy. If you have a partner you’re not married to, he/she may get nothing and even be forced from your shared home if not protected by a properly drawn will.
A will is tailored to your own particular needs. You name as executor(s) the person(s) you want to tie up your affairs and handle your property after your death. An executor can be a relative, a friend, your lawyer, or a bank or trust company that specializes in the handling of estates. If the property management includes a trust, a trustee(s) will also be designated in the will. The choice of an executor and testamentary trustee is yours if you make a will.
If you die without a will and leave young children, a court-appointed guardian will be required to manage your child’s share. Although the court probably would appoint your spouse as a guardian, a bond may have to be posted. If any money has to be used to pay for your child’s education, clothing or living costs, prior approval of the court may be required. The court also requires annual accountings and examination of income and expenses. Investment of the funds by the guardian may be limited. These problems can be avoided or minimized with a properly drafted will. If you and your spouse die at or about the same time it is important that you make provision not only for a guardian of the property of any child under age 18 but also for your child’s person. The person(s) designated in your will as guardian(s) for your children does not automatically have legal authority to act as guardian upon your death; they will have to go to court for approval. While a will is not enough to put in place your future plans for your children, it is strong evidence of your wishes regarding this important decision and is generally given great weight by the courts.
Property held jointly (with right of survivorship) with another, held in trust for another, for the benefit of another, or payable on death to another will not be distributed by will but according to the designation on the account or joint ownership. Life insurance will be distributed to the policy holder’s beneficiary(s) which may or may not be the estate. If the beneficiary is the policy holder’s estate, the policy will be distributed through the will. The same can be said of individual retirement accounts, pension plans, and other assets. It is important to remember that the will is only part of the total plan for the distribution of your property. You should have a clear picture of the assets you own, how they are titled and if there are beneficiaries designated when reviewing or considering making a will.
When you make a will, you should also consider how estate taxes will affect you. The Federal and New York State estate taxes change as a result of federal and state tax reform acts. Currently, there is a $3,500,000 federal estate tax unified credit and a $1,000,000 New York State estate tax unified credit. These amounts may change in the near future.
Making the right plan for your estate takes knowledge and expert advice. To have the best plan for yourself and for your beneficiaries, call a lawyer and make an appointment to discuss your will. The advice of an expert may prove invaluable. Feel free to discuss the attorney’s fees in advance of your meeting.
