Do you suspect that one of your beneficiaries may contest part or all of your Last Will and Testament? If so, you may wish to speak with your attorney about including a No Contest Clause in your Will.

Who Can Contest

Any current beneficiary, any beneficiary from a previous version of your Will who is now disinherited, or any heir at law can challenge your Last Will and Testament. This contest may be for one of four reasons: your Will was not signed according to law, you were not mentally competent to sign, someone fraudulently convinced you to sign, or a beneficiary had a major effect on provisions placed within your document (undue influence). A Will contest may hold up probate for additional months or even years. A long probate could cost your family and estate more money.

What a No Contest Clause Does

A no contest clause is a provision in your Last Will and Testament that aims to keep beneficiaries from contesting your Will. This clause states that if any beneficiary tries to challenge your estate document he or she will be completely disinherited.

Will It Work?

A No Contest Clause does not always work, and in fact it does not work at all in some states, such as the state of Florida. So why bother putting it in, if it may not work? Just the existence of the clause may be enough to deter your family members from protesting any part of your document. If you have left something to a family member in your Will, he or she will know what may be lost by contesting.

If you have disinherited a beneficiary in your Will, he or she will have nothing to lose and will feel no pressure to avoid a challenge. For this reason, it is sometimes advisable to leave at least something to every beneficiary and heir at law to make a no Contest Clause more meaningful.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

Reciprocal Last Will and Testaments, sometime called “I Love You” Wills, is an estate planning device that allows married couples to easily leave their entire estate to the other spouse in the event of death. To decide if a Reciprocal Will is right for you and your family, consider the potential benefits and pitfalls that come with this legal device.

Low Cost Planning

A Reciprocal Will can allow for fast and inexpensive planning. You and your spouse will each create simple Wills that state the other spouse inherits all. If you are looking to save money during the estate planning process, this is a good way to do so. Beware; however, a Reciprocal Will does not fit every family’s situation.

Good for Underage Children

If you and your spouse are the parents of all children in your household and all children are underage, a Reciprocal Will may be the easiest way to handle your children’s inheritance. You cannot leave an inheritance to a minor for his or her own control. With an “I Love You” Will, it is usually assumed that the living spouse will pass on the estate to the children. For this reason, creating a separate inheritance for each of your children may not be necessary in your early years of estate planning.

May Disinherit Family Members

One major disadvantage to a Reciprocal Will is that it can cause family members to be disinherited. When your spouse inherits your entire estate, he or she will decide who inherits next. If your spouse is not the biological parent of your children, you run the risk of having your children disinherited. Your spouse will be able to leave the estate to whomever he or she pleases including his or her own biological children or even another spouse if remarriage occurs after your death.

If you have a blended family, avoid a Reciprocal Will and focus on an estate plan that includes every family member.

Estate Tax Concerns

An “I Love You” Will, will not allow your family to take advantage of basic estate tax savings on the death of the second spouse.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

A Trust Amendment revises the conditions and terms of a Trust. Trust Amendments are only made if certain provisions of a Trust agreement must be changed or modified. All remaining provisions of the agreement remain unchanged in this case. Minor changes may include updating a beneficiary’s name, changes due to marriage or divorce, adding or deleting certain simple bequests, or naming a different trustee.

In contrast, a Trust Restatement is made if the basic goals of forming the Trust have changed or if all or main provisions of the Trust agreement need to be changed. Changes in the number of beneficiaries, changes in the way in which the funds or assets are to be distributed, or compliance with new laws are a few of the significant changes that may warrant a restatement.

A Trust agreement is also restated if the Trust has already been amended several times and consolidating all changes in a clear manner will help provide greater clarity. A restatement can help avoid confusion when directions contained in the Trust are implemented. Restatement of a trust agreement may also make sense if federal and state estate tax laws change, or new administration laws are enacted.

Important Points about Amendment and Restatement of Trusts

• There is no specific rule regarding when you should opt for a restatement or how many times a trust can be amended before it needs to be restated. Get the advice of an experienced attorney.
• While an amendment makes sense for minor changes, a restatement may be essential if major changes are made.
• The restated document completely supersedes the original agreement. In this case, the name and date of the trust remain the same and only the content must be changed.
• A Trust amendment document must be signed and formalized, as is the case with the original document.
• Handwritten changes may not be acceptable in some states or might be considered invalid.

Each time a Trust agreement is changed, the accompanying Pourover Wills should be reviewed as well.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

Making out your Will is only the first step to having a solid estate plan. In addition to keeping it updating, you also want to make sure you store your Will is a place that is both accessible to your family and well-protected. Here’s a few ideas to help you out.

In a Safe-Deposit Box

This option is popular because the Will is accessible by the maker, and it is kept under lock and key in a fire-proof safe. A loved one simply needs to know which bank and the location of the key get access to the Will upon your passing. You should also add your spouse or other loved one to the account as an authorized party so that there are no delays in accessing the box when it’s needed.

With the Your Attorney

Attorneys who draft your Will offer to store the Will at no charge. This absolutely safeguards against any parties attempting to destroy a non-favorable Will. It also provides a secure and fire proof location and permits timely access upon your death. You should notify your loved ones where the Will is stored and should note that on your confirmed copy of the Will.

At Home

Still the most popular option, this can also be the least desirable choice unless the Will is kept in a fire-proof and locked safe or filing cabinet. In addition, remember that this makes it easier for others to access as well so persons that you may have never wanted to see the Will may find and read it.

Of course, this is just a small list of places to store your Will. Just remember to notify your family members of its whereabouts so that they can easily access it after you’re gone.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

Estate plans include a variety of legal documents and plans that are put together to alleviate the impact of your death on your loved ones. At the center of an estate plan is a valid and legal Will that details the distribution of your assets and property.

But as you grow older and your life changes, it’s important that your Will addresses these issues. The situations that may dictate a review of your Will and possible changes are:

• Financial and business changes. Estate plans and Wills deal with finances., Significant changes to personal and professional finances as well as selling important assets or property require and update or review of your Will.
• Changes to tax and estate laws: As tax laws change, particularly with the recent annual changes to the federal estate tax, your Will should be reviewed to ensure that your decisions comply with the tax law changes.
• Change of heart: If you’d like to change a beneficiary, such as adding a charity, changing the recipients of assets, or putting restrictions on inheritances, it’s time to review and change the Will.

It’s important to remember that the will is a living document, it should be updated to reflect life’s changes. Don’t forget that one of life’s changes is our age. Wills should be reviewed at least every five years even if not prompted by another event. Ideally, an annual review will ensure that your Will is always up-to-date.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

While you might think a Will is all you need in your estate plan, this is not always the case. A solid estate plan consists of several documents that not only distribute your property but also ease the financial and emotional burden on your loved ones. Below are some of the legal documents commonly used in estate planning:

Valid Will

We all know that a Will can help us distribute our assets but does it do anything else? In addition to dividing up property, it can also be used to appoint a guardian for minor children. There are however, things it can’t do such as provide for a disabled dependant or protect you in the event of a disability. To really protect you and your loved ones, you need a complete plan.

Living Will

A living will documents your wishes regarding medical situations in which you would or would not want your life prolonged. It also tells your healthcare providers which treatments you do or do not want. This eases the moral and legal burden on your loved ones, as it speaks for you when you are unable to speak for yourself.

Medical Power of Attorney

A medical power of attorney is used to appoint someone to make medical decisions for you in the event you are unable to make them yourself and can be especially important if your Living Will doesn’t address your particular situation. This document not only applies during medical emergencies, but can also be handy for your family to have if you become incapacited.

Financial Power of Attorney

A financial Power of Attorney (also called a Durable Power of Attorney) is a document that names a person of your choosing to make financial decisions on your behalf, should you be unable to do it yourself. It can also document how the person should make those decisions when managing your financial affairs.

Of course, these documents are only part of the picture of a complete estate plan. Depending upon your personal circumstances, you might also want to consider creating incentives for your heirs, providing for children from multiple marriages, or perhaps some of the unique estate planning challenges that face gay or lesbian couples.

The point is, a Will alone does not create a complete estate plan – you need a qualified estate planning attorney to help you do that. For example, should you create a Living Trust? Do you have out-of-state property? How do you ensure that your beloved pet is cared for after you’re gone?

While estate planning can be a complex maze of legalities and ‘what-ifs’, working with a local attorney experienced in estate planning will simplify the process and bring peace of mind when addressing these sensitive topics.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

You’ve probably heard the term ‘trust fund’ but do you know what a trust does? More importantly, do you know how trusts can benefit you and your loved ones?

A trust is a separate legal entity set up by an individual or business to hold assets, such as cash or real estate, on behalf of that individual or a beneficiary. The person setting up the trust is called the grantor or trustor. A trustee is designated to manage the trust and oversee the assets.

Why would you need a trust in your estate plan?

Trusts can help avoid probate, in some states a lengthy and costly process, protect you in the event you become incapacitated and it can also streamline the distribution of your assets after you’re gone. In short, a trust is one of many methods of estate planning that can give you peace of mind.

While there are several types of trusts, a revocable living trust is the most common type of trust found in an estate plan. Unlike a Will, a trust is created while you’re still alive and can benefit both you and your heirs during your lifetime. To create a revocable living trust, several things must happen:

1. The grantor, the person setting up the trust, establishes and signs the trust agreement.

2. The grantor funds the trust by transferring property and titling it to the trust.

3. Beneficiaries are the grantors of the trust during their lifetimes. Successor beneficiaries are also established (these are typically the heirs to your estate).

4. The trustee is designated to manage the assets. In the case of a revocable living trust, the grantor and the trustee may be the same person.

5. A successor trustee is also named to step in and manage the assets after the trustee/grantor is no longer able or passes away.

6. Upon the death of the grantor, the successor steps in and begins distributing the assets in accordance with the trust agreement. Probate is not necessary since the grantor no longer owns the property.

7. If it is important to continue the trust for the benefit of others the successor trustee may hold these assets, and the trust will continue. On the otherhand, once all the assets have been distributed to the beneficiaries, the trust is dissolved.

To determine if a trust is right for you, consult with a qualified estate planning attorney.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

It happens all too often, a person passes away unexpectedly and they do not have a valid will (or Living Trust which we will talk about in our next blog). In the legal world, this is known as dying “intestate.” What happens to the property of the deceased if they die intestate? You might be surprised.

Without a valid Will to dictate how property is distributed, the courts take over and divide the property according to state law. This distribution will normally included the most immediate family members – spouse and children for example – but how the property is divided and who gets what might not always be what you wanted.

In addition, the court will ensure that any debts of the deceased are paid before property is distributed and if assets need to be sold to pay those debts, the court will order that as well. If you didn’t leave a Will to specify which assets should be sold, the court will opt for the most practical assets. This may not be the most beneficial option for your heirs.

The administration process can take weeks or months or even longer, as the court will need to be supplied with a list of assets, including real estate, personal property, stocks and investments, and as we mentioned before, liabilities. Until the administration process is complete, the assets cannot be distributed, creating a potential hardship for family members. Often, a performance bond will be required of the Administrator and that could be costly.

While estates with a Will are probated, the process is often much smoother and even shorter. Because a valid Will is already in place, probate may just involve ratifying, or certifying, that the Will is valid and confirming the executor so that he or she can then begin inventorying assets and notifying beneficiaries.

Obviously, having a valid Will is an important step in the estate planning process. To learn more about drafting a Will, give us a call today.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

There are certain people that are considered to have a “right to inherit” your property upon your death. These people are typically your closest relatives, including your spouse, your children and possibly your grandchildren. These relatives may be able to make an inheritance claim against your estate, even if your will does not name one or more of these relatives as a beneficiary.

Other family members, such as siblings, parents and grandparents may also be entitled to inherit if more immediate relatives are non-existent.

To determine the right to inherit, the courts follow your state’s laws of intestacy but this can be overcome by having a valid Will or Trust that outlines how your estate should be distributed.

It is possible that the Will or Trust could be contested and perhaps even declared invalid by a judge in the event that you do something unusual, such as disinherit a child or a spouse.

The “right to inherit” also typically implies the right to contest so if you’re leaving an immediate family member out of your Will, you should take steps to ensure that it’s clear that omission wasn’t an oversight on your part. You should further provide documentation that proves to the court that you were of sound mind when you made the decision.

Of course, there’s no way to guarantee that a judge won’t still consider the contest. But the more documentation you provide, the better chance you have of ensuring that your estate is distributed in accordance with your wishes.

Also remember that because inheritance laws can be quite complicated, it is never a good idea to try and write your own will. If you want to protect your family and your estate the best thing you could do is to retain the services of an experienced estate-planning attorney.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.

How do I minimize the cost of estate planning?

Many lawyers charge fees on an hourly basis. If this is the fee structure of your lawyer, it would be good if you invest some time in locating the documents relevant to your plan and formulating your wishes in writing. This will help you reduce the time spent with your legal advisor and lower the final cost. It will also help where your lawyer charges a fixed fee since the lawyer will be immediately aware of what exactly needs to be done.

Isn’t estate planning just for old people?

Estate planning is for anyone who owns property and assets in the form of cash and/or securities. With today’s hectic lifestyle affecting people’s physical health and longevity, there is no guarantee that nothing will happen to you till you feel you are old enough to plan your estate. Thus, it is best not to delay estate planning.

Why should I go through all the hassle of estate planning and writing a Will?

Through estate planning, you not only save on costs related to a probate or lawsuits, but also achieve peace of mind. While probate can be time consuming and expensive, lawsuits challenging the claims made by your loved ones may also prove to be traumatic. With your clear and concise estate plan, your loved ones can get what you have bequeathed to them more quickly and with minimal legal hassles.

Why do I need so many documents while planning for my estate? Isn’t a Will enough?

Although a Will is the most critical part of an estate plan, other estate planning tools, such as life insurance, trusts, gifts and joint ownership, can help you transfer your property to your loved ones rapidly and at a lower cost.

Levine & Furman, LLC is a member of the American Academy of Estate Planning Attorneys.