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Category: Trusts and Estates

The Importance of Updating Retirement Account Beneficiary Designations

Many estate-planning mistakes involve retirement accounts. If you or a loved one has rolled over an employer sponsored 401(k) plan into an existing IRA, it is imperative that you update the beneficiary designation form that is on file. The failure to do so may result in an unintended beneficiary. Many individuals unintentionally fail to update the intended beneficiary on file in accordance with life situations such as divorce, death, or birth of a family member or another loved one.

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Placing Property In A Revocable Trust

A common estate planning mistake occurs when individuals own or acquire property outside of a trust. This can lead to unintended tax consequences and exposing property to probate or creditors.

Placing property in a revocable trust provides benefits such as allowing assets to avoid the probate process. In addition, by placing property in a revocable trust, it will allow family members or loved ones to have control over the assets in the event that the creator of the trust becomes incapacitated. Otherwise, a court may need to appoint a guardian.

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Taking On The Role Of “Agent” In A Power Of Attorney

It may be a big undertaking when obtaining a power of attorney for a family member or loved one. A power of attorney provides authority to an agent to make decisions on behalf of the principal in the event that he or she becomes incapacitated. The “principal” is the person for whom an individual is acting as power of attorney. The “agent” is the individual responsible for carrying out the wishes of the “principal.”

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Adding A Prenuptial or Postnuptial Agreement To An Estate Plan

Many people who are looking to tie the knot believe that mentioning a prenuptial agreement eliminates the romance. However, like any business relationship, a prenuptial or even a postnuptial agreement provide a range of benefits and security to both parties involved in the marriage.

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Estate Plans Should Account for Digital Assets

Whether it’s through social media, online bank accounts, PayPal or email, today many people are storing their personal information and finances online. When an individual passes away, his or her online accounts will continue to remain active. For this reason, it is important to account for digital assets in an estate plan. By defining what assets an individual owns and how to access them, a person will ensure that their loved ones can access online accounts that may have sentimental, financial, or practical value. Additionally, making these accounts available to beneficiaries after death can prevent them from falling into the wrong hands, resulting in fraud or hacking.

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Grounds to Contest a Will

When someone contests a Last Will and Testament, they are objecting to its validity. In order to contest a Will in New Jersey, an individual must have “standing,” or locus standi. To have standing, or locus standi, the individual must be considered a person with an interest in the estate, such as legal heir. Anyone named in a prior Last Will and Testament may also have standing to contest a Will, if the Will entered into probate removes or reduces the share that person or group would have received in a prior Will.

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Important Documents to Have in Place Specifically for End-of-Life Decisions

Every individual should have documents such as a Health Care Proxy, Living Will, Do Not Resuscitate (DNR) and/or Do Not Intubate (DNI), and Practitioner Orders for Life-Sustaining Treatment (POLST) in place to assist loved ones who may need to make medical decisions on their behalf, including end-of-life decisions. A brief overview of the purpose of each document can be found below.

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What to Do When the Surrogate’s Court Asks for an Inventory of Assets

An inventory of assets is a form that may be required by the Surrogate’s Court. The form must be completed and delivered to the court by either the fiduciary of the estate or, at the request of the fiduciary, it may be provided by the attorney on record.

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Probating a Will

It is important to create a comprehensive estate plan, and there are certain measures that one can take to avoid probate if done correctly. Probate is the legal process whereby a last will and testament is determined to be valid and authentic by a court of law. Under New Jersey State Law, the will is admitted to probate when the executor files a “Petition for Probate” with the decedent’s will attached. Additionally, if the decedent died without a will, then an administrator would apply with the Surrogate. Probate proceedings take place in the county surrogate’s court where the decedent resided at the time of their death.

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New Jersey Credit Shelter Trust and Estate Taxes

Over the last few years, both New Jersey and federal estate tax laws have changed. Currently, a decedent’s estate only needs to pay federal estate tax if the gross value of the estate exceeds $5,490,000. In New Jersey, estates with a value in excess of $2,000,000 have to pay the state’s estate tax. As of January 1, 2018, the New Jersey estate tax will no longer be in effect.

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