New York Estate Planning & Elder Law Blog

Entire Estate Left to a Dog?

Published on: August 16, 2012 | by Ettinger Law Firm

Ken5 News reported on a unique estate planning case this week involving a man who left a fortune to his favorite canine.

The report explains how the man amassed a large collection of various valuables over his lifetime, from fine china to antique furniture. His possessions were enough to fill ten homes. Wanting to ensure his wishes were carried out after his passing, the man contacted an estate planning lawyer to ensure legal documents were in place. Trusts were used to protect the valuables and delineate ownership in the event of death or disability. Our New York estate planning lawyers know that all of this is similar to steps taken by local families (of all net worths) when planning for the future.

What was different in this case, however, was who was set to receive all of these valuables at the man’s death. Interestingly, the man’s will left everything to his dogs–only one of which, named “Lucky,” was actually alive when the man passed away.

Naming Guardians for Children in New York Estate Plan

Published on: August 14, 2012 | by Ettinger Law Firm

Designating inheritances is not the only purpose of a New York estate plan. Some local residents may feel like there is no rush to have a plan in place, because they do not have many assets to pass on or have no particular wishes about their possessions. But inheritances are just a part of the planning. For one thing, all families with children–regardless of their net worth–need to have a plan in place to designate alternate caregivers for their children in the event of death or disability.

Naming an appropriate guardian is one of the most important preparatory steps that a parent can take to ensure their child’s well-being no matter what the future holds. If the parents do not make their wishes known in appropriate legal documents, then the decision is left to the court. While the court will work to make the best decision with the information in front of it, there is obviously no replacement for a parent’s choice.

In our area it is crucial to have a New York estate planning lawyer guide your family through this process. That is both to ensure the legal formalities are met and also to have an experienced third-party involved in the event of disagreement.

Professional Guidance Helps Avoid IRA Scams

Published on: August 10, 2012 | by Ettinger Law Firm

The financial world is a complex one. It is easy for local residents to get lost in the mire of special accounts and various loopholes to maximize their savings while protecting their hard-earned dollars. As always, the professional guidance of financial experts, estate planning attorneys, and others is usually the only foolproof way to ensure costly mistakes aren’t made. This also comes with the added benefit of having a trained set of eyes ensuring that one doesn’t fall for one of the many financial scams.

For example, the Wall Street Journal published a story late last month discussing the prevalence of Individual Retirement Account (IRA) scams. A growing number of states have opened investigations into fraud as a result of “self-directed IRAs. These special retirement accounts allow investors to use funds in a range of ways, including things like hedge funds and land purchases. The investments involved in these efforts are not publicly-traded which, officials advise, makes them far more susceptible to fraud.

For example, in one high profile case several defendants were accused of convincing individuals, mostly seniors, to roll their retirement accounts into these self-directed IRAs. Those doing so thought that the decision was a safe alternative to stocks or bonds. In this case, the investors were told that the money would be used to fund profitable small businesses.

Estate Tax “Portability” Trap

Published on: August 6, 2012 | by Ettinger Law Firm

Nothing is easy when dealing with the Internal Revenue Service (IRS). Even situations that seems straightforward or streamlined invariably involve developing complications that present headaches to taxpayers. Our New York estate planning attorneys know that this bears out in many planning issues.

Take, for example, the estate tax. As helpfully explained in a recent Wall Street Journal story, if not careful estate executors may cause spouses to miss out on millions in estate tax exemptions. This June the IRS intended to help families by streamlining the process for receiving the exemption. The new guidance sought to fix the complications caused by one spouse leaving all their assets to the other. Each spouse has a $5.12 million exemption individually, but when leaving assets to one another one of those exemptions was oftenlost. The new rules clarify the “portability” of the exemption from one spouse to another. In the past, various trusts were needed to get around this problem.

Yet, the new portability of the exemption does not mean that nothing need be done after a death to take advantage of the spouse’s exemptions. An estate tax return must be filed within nine months of the partner’s death to receive the benefit. Many executors may be under the mistaken impression that the return does not need to be filed. Failure to complete this step may be the difference between sheltering $5 million from the tax instead of over $10 million. Estate planning lawyers appreciate that this is no small error–literally millions of dollars might go to Uncle Sam which would have stayed with a family.

Prenuptial Agreements: What if Couples are from Different States?

Published on: August 4, 2012 | by Ettinger Law Firm

Prenuptial agreements commonly make headlines as celebrities getting hitched try to protect their fortunes. But the focus on celebrities (or the ultra-rich) is misleading. In reality, average Americans should, and frequently do, make use of the benefits of prenuptial agreements. In our area, New York estate planning attorneys know that these agreements are an important part of one’s long-term planning, particularly in the event of late-in-life or second marriages. These agreements allow for an individual to prepare and protect themselves and their families. But the creation of these legal documents is not without some pitfalls.

The Basics

A prenuptial agreement is essentially a contract between two people planning to get married. They agree prior to marriage on how they will divide their assets if they are divorced and on any number of other issues. While this process can be emotional, especially because the couples are naturally optimistic and excited about their future, forming this agreement while everyone still cares for each other and wants the best for each other is always the preferred model. If the good feelings should disappear, this agreement allows a couple to separate as fairly and painlessly as possible.

Failure to Update a Plan Nightmare

Published on: August 3, 2012 | by Ettinger Law Firm

Estate planning takes time. Unfortunately, considering the daily time stresses faced by all local residents, our New York elder law estate planning attorneys appreciate that there is often not a sense of “urgency” with this planning. It is usually a task that gets pushed to the side while day-to-day choeres are dealt with.

Yet, there are many individuals out there who can testify about the consequences of failing to plan their estate.

For example, one recent editorial shared that story of a husband and wife who had been married for one year. The husband was waiting for a liver transplant and despite his precarious health situation the couple did not do any estate planning, thinking they had “plenty of time.” This would prove incredibly harmful for the family.

Improvement in the IRS Art Value Appraisal Services

Published on: August 1, 2012 | by Ettinger Law Firm

An appraisal is an expert assessment of the value of a particular asset at a given time. Many factors involved in the appraisal of a property can easily distort its value–overvaluing or undervaluing it.

The IRS uses appraisals in the process of assessing property taxes, which requires the appeal of experts in the subject. As such, the IRS’s Art Appraisal Services’ (AAS) job consists of assessing the value of works of art for tax purposes. Our New York estate planning lawyers work with families who have valuable art collections and whose tax burden is significantly affected by these appraisal services.

A recent article in Accounting Today discusses the IRS’ need to improve its appraisal of the value of art and the Government Accountability Office (GAO) report on the matter.

Massive Medicaid Fraud and Texas’ O.I.G Dollar Recovery Strategy

Published on: July 31, 2012 | by Ettinger Law Firm

Medicaid and Medicare frauds have been weighing heavily on states’ financial resources in the past years and New York is not an exception.

In the midst of solutions to this inter-state problem, eyes are focused on the Office of Inspector General at Health and Human Services Commission (O.I.G) – charged with investigating fraud among health care providers in Texas- who has revolutionized its method of dealing with frauds. Our New York Medcaid attorneys are intimately familiar with the important role the program plays in the lives of so many local residents.

The O.I.G’s strategy: A Fair Solution to Medicaid Fraud?

Medicaid and Pension Obligations Pressuring State Budgets

Published on: July 26, 2012 | by Ettinger Law Firm

A new report from the “State Budget Task Force” released last week found that two issues were by far the most pressing for state and local government budgets: pensions and Medicaid. The full report can be viewed HERE.

Chaired by former New York Lieutenant Governor Richard Ravich, the group creating the report examined six states (including New York). Much focus was placed on currently unfunded New York Medicaid and pension obligations. It is unsurprising that these two issues are at the top of the list, and our New York elder law estate planning lawyers know this is even more reinforcement of the vital need for residents to plan for retirement and elder disability issues on their own.

In issuing the report, Ravitch argued that the problems extend beyond the recession. Instead, the report claims that the underlying financial concerns are far greater than a simple drop in revenues and increased need for aid services due to the economic climate. Like all similar reports of this nature, the author claims vast structural changes are needed to account for the looming fiscal crisis.

DOMA Challenge Likely Headed to U.S. Supreme Court

Published on: July 25, 2012 | by Ettinger Law Firm

http://www.washingtonpost.com/lifestyle/style/edie-windsors-fight-for-same-sex-marriage-rights-continues-even-after-partners-death/2012/07/19/gJQARguhwW_story.html

In the wake of the passage of marriage equality laws in our state, many assumed that the issue was settled for New York’s same-sex couples–they would be treated the same as all other couples in our state. Not so. Our New York estate planning attorneys are acutely aware of the continued inequalities faced by these citizens. The problem is rooted in federal treatment of these couples with clear estate planning ramifications.

A 1996 law–the so-called, “Defense of Marriage Act” (DOMA)–forces the federal government to treat same-sex married couples differently than others. Breaking with long-standing tradition of recognizing all marriages legal in each states, the federal government explicitly defined marriage as not including same-sex couples. As a result, same-sex couples married legally in individual states are still considered strangers by the U.S. government. Obviously, this split recognition has negative consequences for the involved couples. All estate plans for these couples must continue to take this into account.