Estate Planning

Discriminatory Old University Trust May Be Modified

Published on: May 20, 2013 | by Ettinger Law Firm

Upon visiting an estate planning lawyer for the first time and learning about available options, many are surprised at the flexibility of different legal tools involved in the transfer of property. Far from simply doling out assets to specific friends and family members, one has immense control in deciding how those assets are used, when they are received, and what can trigger the loss of those assets. In this way, unique plans can be crafty which account for any number of family dynamics–multiple marriages, concerns about ex-spouses, children with special needs, relatives with poor money management skills, and more.

Similarly, the same flexibility often exists with gifts to charity. Many New Yorkers decide to share part of their assets with favorite non-profit causes. Those gifts can be one-time transfers or they may involve the creation of trusts for use in specific ways. For example, one of the most common charitable trusts involves setting up a scholarship fund to an alma mater to benefit future students. The trust may be funded with various assets, growing over the years and helping countless students.

Those creating these trusts can set many different terms on the gifts. Perhaps you’d like the funds to be used solely for those interested in pursuing nursing or for those who came from a certain disadvantaged background. In most cases, an attorney can help craft the legal arrangement so that your exact wishes are carried out.

Siblings Inheritance Feud Turns Criminal

Published on: May 14, 2013 | by Ettinger Law Firm

Estate planning attorneys frequently urge residents to be careful about creating long-term plans to avoid family feuding. Careful consideration of inheritances, open communication between families, and prudent use of tools like trusts are usually the best way to ensure that families are not torn apart after a passing.

Some seniors appreciate certain inherent conflicts within the family and work to counter those risks. However, many others assume that such feuding only affects “others” and their family members would never fall into arguments and ruin relationships over property or other end-of-life matters. The reality is that no one knows for sure how things might play out. Reactions to the loss of a relative often spur deep psychological impulses with emotions askew. That can spur problems for even the most stable families.

Estate Planning Murder Plot

Children-Out-of-Wedlock and Inheritance Feuding

Published on: May 9, 2013 | by Ettinger Law Firm

The more complex a family arrangement, the more tailored estate plan is likely needed. For local residents this often takes the form of second or third marriages, with children and different step-relatives. The “default” rules may not be good at accounting for these various relationships and balancing the unique needs of wishes of each family member. Yet, even in the most extreme cases, an estate planning attorney is able to craft the best possible arrangements, provided participants are open and honest about their situation.

But, things can get particularly sticky when there are secret relationships or other family dynamics that are not incorporated into a plan.

Mistress & Children Fight for Inheritance

Developments in Anthony Marshall Case – Brooke Astor Estate Fiasco

Published on: April 29, 2013 | by Ettinger Law Firm

Celebrity estate planning complications and feuds are often used to illustrate basic planning principles or common problems. Perhaps none of those examples are as well-known, especially for New Yorkers, as the sad case of the estate of Brooke Astor. The legendary socialite and philanthropist died several years ago. Since her passing, a wide-range of claims were made regarding the distribution of her assets and criminal activity on the part of those responsible for her care and affairs in the later years of her life.

Astor reportedly suffered from Alzheimer’s at the end of her life–an affliction that similarly affects many New York seniors. Unfortunately, also like many others, it seems that her condition was abused by the very people who were supposed to look-out for her.

Astor’s son, Brooke Marshall, was criminally charged with exploiting his mother to funnel more money to himself. Marshall was ultimately convicted, along with a co-defendant, of illegally giving himself a $2 million “raise” to administer the estate. Claims also suggested that an amendment to Astor’s will in 2004 included a forged signature.

The DuPont Case, Mental Illness, and Wills

Published on: April 26, 2013 | by Ettinger Law Firm

Residents are often warned to complete their estate planning–wills and trusts–before it is “too late.” Most assume that the planning is only “too late” if they die before getting it done. But that is a mistake. In many cases “too late” actually refers to losing the competency to create the legal documents. As a practical matter, it may even mean before one even has the appearance of mental health issues, because even a hint of problems may open the door to legal challenge from others.

Estate planning is about ensuring one’s wishes are carried out and maximizing the preservation of assets without controversy. Limiting that controversy includes completing the planning early and efficiently, minimizing the risk of problems down the road. Thought of in that way, “too late” is far earlier than simply “before you die.”

John duPont Estate

New Case: Inheritance Rights of “Adopted Out” Children in New York

Published on: April 17, 2013 | by Ettinger Law Firm

A case recently came before a New York court that delved into a very unique inheritance issue. The case, Matter of Svenningsen involved the inheritance rights of “rejected” adopted children. “Rejected” is a harsh word, but refers to children who were adopted and whose adopted parents terminate parental rights. It is a rare occurrence, but various health issues or circumstantial factors may make such change in parental rights necessary in some cases.

The circumstances in the Svenningsen case are somewhat complex. Essentially, a New York family adopted a child, Emily, from China in 1996. The family had executed a trust in 1995 the had specifically included adopted children. A second trust was executed in 1996 that specifically named Emily. Sadly, the patriarch of the family died the following year, in 1997.

Eventually, Emily began attending a boarding school for children with special needs. Apparently Emily developed a close bond with those working at the school. As such, several years later, in 2003, Emily’s adopted mother agreed to terminate her parental rights under the assumption that Emily would be adopted by one of the director’s of her boarding school. No mention of Emily’s trust was provided during that second adoption hearing.

Federal Estate Tax — Back on the Agenda?

Published on: April 12, 2013 | by Ettinger Law Firm

Earlier this week we touched on the fact that estate tax issues need to be on all New Yorkers’ radar, because the state tax kicks in at a far lower level than the federal tax. The federal rate was seemingly fixed as part of the compromise legislation that averted the “fiscal cliff” earlier this year. While any law can be changed, the passage of this legislation was assumed by most to signal some level of finality on the matter. Debate had raged for months (even years) about the exemption level and rate. The uncertainty was a challenge for estate planners, because it is more difficult to craft complex protection plans when the tax rules are a moving target

In that vein, regardless of one’s own opinion of the estate tax, passage of the compromise bill was a welcome relief–offering stability. But that stability may be short lived, as proposals about changing the federal estate tax have are already making their way back into national political discussions.

Here We Go Again

Don’t Forget: There is a New York Estate Tax on Top of Federal Tax

Published on: April 10, 2013 | by Ettinger Law Firm

Much discussion at the end of last year dealt with the estate tax. As federal officials groped for a compromise to avoid the so-called “fiscal cliff,” details about the federal estate tax were one part of the negotiations. Democrats wanted it returned to levels during the Clinton Administration while Republicans wanted it eliminated altogether.

Just before the deadline, a law was passed which apparently settled some of the matters of contention. In so doing, it seemed to finally provide some permanence to the federal estate tax. The tax rate now tops off at 40% (a jump from the previous 35%) and begins on parts of the estate over $5.25 million. The exemption level is pegged to inflation, and so it will rise slightly each year.

With news of this new estate tax compromise (and its relatively high exemption level), many have pointed out that the federal tax is now only a concern to a small slice of the population. After all, the majority of residents will not die with assets over $5.25 million, and so estate planning to avoid that federal tax is unwarranted.

Washington Post Article on Family Struggles in Dividing Up Assets

Published on: April 5, 2013 | by Ettinger Law Firm

A recent Washington Post article discussed the lethal combination of family and finances. The author recounts how even the most close-knit families can be torn apart by disagreements about money matters. The article included one reader to wrote a letter offering an example of how his parent’s will is causing tension and turmoil.

The letter was written by an adult son who was asked by his parents to assist with their estate planning. He was named executor and helped with locating financial documents. The son saw a copy of the will after it was completed, noting that it left assets to a few charities and then split the remaining estate between himself and his one sibling–a sister. This represents a pretty common situation, with families assuming that such a simple estate plan and division will not come with any disagreement.

But then a few years later the parents updated their will. Instead of splitting the assets between their two children, they decided to split it in thirds. Their two teenage grandchildren (from their daughter) will receive a third, and the two adult children will each receive a third. The son noted with shock that his share suddenly went from one half to one third.

Effect of Presidential Budget on Estate Planning

Published on: March 29, 2013 | by Ettinger Law Firm

Nothing about the law is every entirely static. Obviously legal rules and principles change over time. However, some practice areas are far more stable than others. For example, the general process to recover for personal injuries in a car accident are roughly the same now as in the past. At the other end of the spectrum, certain estate planning processes can change virtually every year. That is because much of this planning is centered on tax savings. In that way, it mirrors applicable tax rules, and any change in those rules requires changes in estate planning details.

Possible Changes

For example, consider the estate planning changes that may need to be made if the latest presidential budget proposals are enacted. Financial One recently shared information on those possible alterations. The President’s proposed 2013 budget includes some so-called “tax loophole” closings which may alter what planners do for future clients.