Trusts

November 15, 2013

The Estate of New York Musician Lou Reed

Celebrity estate planning remains one of the most common ways that local residents are confronted with issues regarding wills, trusts, and other inheritance issues. As the old adage makes clear, the only certainties in life are death and taxes. It does not matter whether one is a billionaire, international celebrity, elementary school teacher, or anything in between. We will all face death and deal the the aftermath of a passing.

In that way, it is useful to take advantage of high-profile deaths as a way to again share information on the value of estate planning.

The most recent celebrity planning story to hit the headlines is that of famed musician Lou Reed. Reed died in late October in Southampton, New York following liver disease complications at the age of 71.

November 1, 2013

What Matters When Choosing an Executor?

by Ettinger Law Firm

Understanding the specifics of the law is just one aspect of successful estate planning. Obviously it is critical that a will is created in a such a way that it will be upheld or that a trust will have legal effect (or that you take advantage of all available trust options to begin with).

But that legal knowledge is not enough to best prepare for the future. In addition, it is critical to understand the social, emotional, and practical considerations that affect these issues. Are certain family members more likely to feel jilted by a specific arrangement? Is there a financial danger that should be guarded against? These and hundreds of other questions must be considered when planning. Memorizing statutes and legal books will only provide so much guidance–experience on these issues fills in the gaps.

Advice for Executor Selection

October 31, 2013

Back to the Basics: Trusts Are Not Only For the Wealthy

by Ettinger Law Firm

One of the biggest misconceptions about general estate planning is that a “trust” is something that only rich families need to consider. This perception likely arises from colloquial use of “trust funds” to signify wealthy individuals who are living off substantial earnings preserved for them in a trust.

A better understanding of the legal tool takes away much of the mystique. The bottom line is that trusts are for everyone, serving as an incredibly useful option for middle class New Yorkers to protect assets accumulated over a lifetime for themselves and their loved ones.

The Basics

September 30, 2013

Tough Legal Questions: Inheriting Digital Media

by Ettinger Law Firm

It is a cliche to assert that the world of estate planning is ever-changing. Of course, laws are frequently altered by policymakers which affect the best practices for passing on an inheritance and saving on taxes. For example, just this year Congress agreed on new federal estate tax rates, which may influence how some decide to use wills and trusts to best plan for the future.

But it is not only legal changes that impact these issues–technological and cultural changes can uproot estate planning details as well. On the cultural side, consider the changing gender roles. Only a century ago, in many families it was expected that the oldest male would inherit almost the entire estate, with daughter and younger sons receiving only a minimal inheritance. While similar arrangements can be made today, the practice is incredibly uncommon. Cultural changes since then altered how these distributions are normally made.

Technology Changes Estate Planning

September 26, 2013

Mysterious Will Filed in New York Intestate Case

by Ettinger Law Firm

Earlier this year we shared information about a $40 million New York inheritance that was destined to go entirely to the government. 97-year old former NY developer Roman Blum died in January, leaving behind the multi-million dollar estate. Yet, it seems that Blum conducted no estate planning–no trust was created and no will was found. Not only that, but it was unclear if he had any living relatives. As a result, per intestacy rules in the state, the assets would eventually “escheat” to the government. This represented the largest unclaimed estate in New York history.

The case is often pointed to as a vivid reminder of the need to lay out your inheritance wishes ahead of time or risk losing control of the decision entirely.

Will is Found?

September 23, 2013

State Supreme Court Sends Most of James Brown Assets to Charity

by Ettinger Law Firm

One common misconception regarding estate planning is that simply getting wishes down on paper automatically means that those wishes will be carried out. Some New Yorkers, for example, may be under the too-optimistic assumption that drafting a quick will designating inheritances is enough to ensure that assets will go where intended.

It may be that simple in theory, but the reality is far murkier.

That is because challenges to wills and trusts are incredibly common. Disputes frequently result in compromises that are far different than what was originally intended. That is sometimes true even in cases where extensive planning was done ahead of time.

September 16, 2013

Planning Must Consider the Unforeseen Future, Not Just the Present

by Ettinger Law Firm

It may seem obvious, but it is critical for all of your long-term planning, from an inheritance to a business succession strategy, to take into account potential events that have yet to happen. Far too many New Yorkers engage in estate planning and financial planning that gives short shrift to potential changes in circumstance in the future. It is worth reiterating that all families should make plans that take into account unknown future events, like divorce, disability, a lost job, and more.

Divorce, Disability, and More

A Financial Advisor magazine article from late last month touched on the principle of long-term forecasting. The story is focused specifically on business succession planning, but the basic principles are applicable to many forms of long-term preparations. The story summarizes the potential unknowns as the “Four Ds” — divorce, disability, drugs, and death.

September 10, 2013

Tax Evasion Case – Hiding Inheritance from IRS

by Ettinger Law Firm

One important purpose of estate planning is to ensure that as many assets as possible pass on to friends, families, and charities–instead of Uncle Sam. Using trusts and other legal arrangements to structure an inheritance is a prudent move for all New York families, but particularly those with sizeable assets. Taxes at both the state and federal level can take a significant chunk out of any inheritance. There are many high-profile cases of individual who failed to take advantage of all the planning tools at their disposal, resulting in an inflated tax bill. The estate of actor James Gandolfini’s, settled in New York, is just one recent example of how millions can be lost to taxes.

Illegally Cutting Corners

Unfortunately, some families may be tempted to cut corners and resort to illegal conduct in order to prevent the government from collecting on a large tax bill. The temptation to act in this manner is even higher when prudent estate planning is not conducted at the outset.

September 5, 2013

Inadequate Retirement Worries? – Tips to Boost Your Savings

by Ettinger Law Firm

Retirement saving. Those two works often strike immediate fear and worry in the heart of New Yorkers. It is hard enough for many families to meet their weekly needs, from mortgage payments to children’s tuition payments and everything in between. In the end, there is often little left over to stock away for one’s golden years. Add in the 2008 economic recession, which hurt many plans, and it is no wonder that New Yorkers are worried about the inadequacy of their retirement.

Fear not. Depending on your age, there is still time to put strategies in place to ensure access to resources for later in life. Even if you are knocking on retirement’s door, there are still steps that can be taken to catch-up.

Strategies from Forbes

August 19, 2013

Issues with Family Vacation Homes

by Ettinger Law Firm

Many New York families have vacation homes. While the reference often conjures up images of the super-wealthy wintering in palacial estates, the truth is that owning a second piece of real estate in a favorite location is not only for the elite. Middle class families who prudently save often decide to purchase a second home for investment purposes.

Considering the frequency of these homes, it is important for families to be aware of some financial and estate planning issues that they may create. A Forbes story from last week provides a helpful introduction into the topic.

Unfortunately, the use and future ownership of these homes is often cause for confusion, misunderstanding , and argument. For one thing, parents and children often have different ideas about the property. Is it meant to be a family keepsake that is passed down through the generations as a meeting place and memory maker? Or is it simply an investment item that can be sold if necessary without much thought? Often different family members have different levels of attached to these homes. One sibling may hold the location dear and never dream of getting rid of it while another may have few memories of the home and not wish to hold onto the property if it does not make financial sense.