WILLS AND ESTATES

WILLS / TRUSTS / ESTATE PLANNING / PROBATE

Here are some important decisions you can make to protect yourself and your family.

Create a Will
It’s been estimated that seventy percent of Americans have never drafted a will. This is amazing, because it is one of the most important documents you will ever create, especially if you have children.

In addition to your will, it is advisable to create Power-of-Attorney’s to allow someone you trust to be able to make financial decisions or pay bills on your behalf if you are not able to do so yourself.

Also consider creating a living will, outlining the types of treatments that you would want or not want to have performed. Typically a living will is accompanied by a health care proxy, which is a Power-of-Attorney specifically for making medical decisions.

WHY MAKE A WILL?
Everyone owns something and therefore is an owner of property – real or personal – and has an estate. REAL PROPERTY is land and buildings. Everything else that may be owned is called PERSONAL PROPERTY, such as bank accounts, stocks, bonds, furniture, automobiles, money, life insurance, jewelry, and personal effects. It is the owner’s privilege to select to whom his/her estate will go. You may choose one of several ways to dispose of your estate – by a Will, by creating a trust or joint ownership, or by letting the law distribute your property. Some of your property is best distributed by non-probate devices that can transfer property automatically to a named person at your death without looking to your Will, but you need good advice as to what assets you really want to transfer that way. (See Joint Ownership below).

For everything else you do not specifically set up outside your Will, the Will is what makes sure anything else you have goes to or is cared for by a person or entity of your own choosing.  Furthermore, a will can arrange your personal affairs to pass with the least tax consequences possible, which is especially important in larger estates.  Wayne F. Jentis, Esq. and East Coast Law, P.A. is dedicated to finding and providing you with the best available options for your individual situation, but you you have to take the first step to address your own estate planning and Will needs.  Too many people put off making a will because they think it is too difficult, expensive or a sad subject.  On the contrary, a Will can be quite simple and inexpensive and most people are so relieved to have one done they wonder why they never did it sooner.

THE BEST REASONS TO CREATE YOUR WILL
Making a Will is an important step in your financial management program. To save your heirs time and money, you can plan now for the orderly transfer of your property. Making a Will will avoid the cost of a bond and possible disagreement among those who are to receive your property. You decide to whom, when, and in what amounts your assets should go. You select your executor or personal representative, the one who shall be responsible for the disposition of the estate. You may avoid a forced sale of your property, or costly and tedious applications to the courts for the right to sell it. You have greater assurance that your plans will be carried out as you desire. Without a Will your estate must be distributed according to the intestate laws, the provisions of which are general and inflexible. The law will say who shall administer your estate, among whom, and how it shall be divided. If you do not name an executor or personal representative, your property may not be distributed as you wish, and thus cause hardship for those you want to safeguard most. Without a Will you lose the privilege of naming a guardian for your minor children. This is vital, particularly if your spouse should not survive you. If you leave no immediate family, failure to leave a Will may result in your property going to persons in whom you have no particular interest.

STEPS IN PREPARING A WILL
A document that will stand up in court, and tailor-made to meet the needs of your family, must be thought out carefully. The Will can be prepared by an attorney who specializes in Will drafting or estate planning. The attorney can guide you to the best decisions – but only after obtaining all the facts that you alone can give. Thus, you can be sure that your Will is properly phrased, witnessed, and has all the technicalities observed.

THINGS TO KNOW WHEN MAKING A WILL

MOST COMMON QUESTIONS:

1. You don’t need to make an itemized statement of your assets, nor do you need to state the disposition of your property item by item.
2. You can change your Will at anytime you wish, as your assets, beneficiaries or desires change.
3. Your Will is not required to be recorded before death; no one needs know of it if that is your wish.
4. The existence of the Will does not affect your ability to sell or dispose of property. You may continue as though you had not written the document.
5. While the law permits a beneficiary to witness a Will, it is recommended that a beneficiary witness be used only when a disinterested party is not available, in order to avoid future challenges as to conflict.

1st:  If you wish and want the most detail, start by making a list of everything you own and owe – a statement that will show exactly where you stand financially. Decide to whom you will leave your real and personal property. Be certain you have stated just what your wishes are by making a list of the persons involved, their relationship to you, your objectives, when their bequest is to be given, and how it is to be provided.

NOTE: You may make bequests to friends or charities. It is not mandatory for you to make bequests only to family members.

2nd:Select an executor, executrix, or personal representative to administer the Will. This may be a beneficiary of your estate, a member of the family, your legal or financial advisor, a trusted friend or business associate. You should name a contingent executor or personal representative to act in case your first selection dies before you, or is unable to serve. A bank can act as an executor, personal representative, trustee under a trust, or guardian of either a minor or incompetent person.

A bank is experienced and familiar with accounting and management details. It is financially responsible and a continuing institution if an individual may die, but a bank has continued life. In selecting your executor or personal representative and trustee, the choice should be business like, not sentimental. Your executor or personal representative has the important responsibility of settling your estate and seeing that the wishes expressed are faithfully carried out.

Here are a few of the things an executor or personal representative may be required to do, in addition to seeing that the Will is offered for probate:

1. Qualify as executor, (also known as Personal Representative), obtain a certificate of authority, and if necessary, execute a bond.
2. Locate and take possession of all property, discover and assert all rights and line up claims owed by the estate.
3. Prepare and file an inventory of all property and interest of any kind belonging to the estate, listing the appraised value.
4. Review all assets, liquidating those of doubtful character.
5. Advertise for claims and pay them in the order cited by law.
6. Collect monies due the estate.
7. Figure and pay taxes.
8. Pay legacies under the Will.
9. Distribute the estate.
10. Make final accounting to the court, if required.

3rd: It is important that you name a guardian if you have minor children.

4th: You may put in last requests regarding your person, such as whether you prefer to be cremated or buried, and where you would like your last resting place to be if this is important to you.  This information is better placed in a separate Letter of Instruction as described below, if such a document exists and will be easily found.

East Coast Law, P.A. will provide you a rough draft of your Will to carefully review before signing the final copy.

SIGNING YOUR WILL
A Will must be written, signed by the testator (maker) and witnessed. The original copy is the legal document and must be signed.

In order for a Will to be admitted to probate, it must have at least two witnesses. The testator and the witnesses are required to be present at the signing, and each must see the others sign. The witnesses do not have to read it or know what it contains. However, they must be told by the testator that it is his/her Will, and asked to sign as witnesses.

The witnesses should be likely to outlive the testator and remain in the community. If you do not have a self-proven Will, the whereabouts of your witnesses should be known at all times.  (East Coast Law, P.A. always attaches appropriate documents and attestation to create a self-proven will so that the witnesses will not not have to be available for the Will to be probated).

SELF-PROVEN WILLS
If the witnesses and the testator execute an affidavit before a Notary Public, it will not be necessary for either of the witnesses to appear in Surrogate Court at the time of Probate. As your attorney, we can review your Will and advise you as to whether it can be made self-proven and prepare the proper Affidavit to comply with the law.

COMMON DISASTER CLAUSE
A well-drawn Will contains a common disaster clause to establish contingent beneficiaries if both husband and wife die within a stated period of time. Without a clause, if both husband and wife die with no way to determine who died first, their individual property is disposed of as if they had a widow and widower.

SAFEKEEPING YOUR WIL
Keep your Will in a safe place, but let the executor know where it can be found. If kept in a safe deposit box, it usually can be removed by the executor in the presence of an employee of the bank immediately after death. Husband and wife should have their own wills. They each should know where both are kept.

YOU SHOULD ALSO PREPARE LETTER OF LAST INSTRUCTIONS
Those who administer an estate and take care of what is left often find themselves without necessary information. To facilitate their job, it is advisable to give your executor, executrix, personal representative or attorney a letter of last instructions – which is separate and apart from your Will. This letter, to be opened upon your death, should contain the following:

• Names and addresses of those to be notified at death, and relationship of members of family and relatives.
• Statement as to where your Will may be found.
• Instructions as to funeral and burial. You may Wish to specify, for example, that, as a Veteran you want to be buried in a national cemetery.
• Where your birth or baptismal certificate, certificate of auto ownership, social security card, marriage or divorce certificate, naturalization and citizenship papers, and discharge papers from the armed forces may be found.
• Where your membership certificates in any lodge or fraternal organizations which provides death or cemetery benefits may be found.
• Location of any safe deposit boxes you may have, and where keys are kept.
• A list of your insurance policies and where they may be found.
• A list of all bank accounts, checking and saving; their location and where the passbooks are kept.
• A list of all other savings accounts; for example, credit union deposits, etc., and passbook locations.
• A statement concerning any trusts and/or pension systems from which your estate may be entitled to receive benefits.
• A list of all stocks and bonds or other securities you own, and where they may be found.
• A statement of all real property owned by you with the location of deeds, mortgages, abstracts, and insurance policies for real property owned.
• A location of copies of income tax returns for previous 5 years.
• Receipted bills and canceled checks for last 5 years.
• List of debts and names of creditors – with addresses.
• A statement of reasons for actions taken in your Will, such as disinheritances. It is usually better to place the explanation in a separate but accompanying letter, rather than in your Will, to avoid a complicated will and expensive litigation.
• List of any gifts made and information needed for estate tax.
• A list of any payments made, especially for funeral expenses.

KEEPING YOUR WILL UP TO DATE
Periodically review your Will to keep it up to date. Keeping it current is just as important as making one in the first place. Changes in your life such as marriage, birth of a child, death, change of witnesses, purchase or sale of property, a change in your financial status – or a change in the estate tax law may make important revisions or a new Will advisable. A Will drawn in another state can be valid; however, revision in relation to laws of the state you currently reside in may be prudent.  As a member of the FL, NJ, and NY bars, Wayne F. Jentis, Esq. is qualified to help you analyze any such need in relation to those states and may be able to help you determine such a need regarding other states.  Of course you should be aware that you are free to change your Will at any time.

HOW TO CHANGE YOUR WILL
The safe way to change your Will is to have a new one drawn; however a codicil may be effective.

A codicil is a separate document used to make minor changes. It must be signed with the same formality as the Will itself. It is not necessary to have the same witnesses on the codicil and the original Will.

Do not try to change your Will by drawing lines through items, erasing, writing over or adding notations. This may destroy it as a legal document.

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Wayne F. Jentis, Esq., and East Coast Law, P.A. strongly advocates that everyone should have a Will, but as a service, the following information SECTION is provided as an example regarding what happens to the property of individuals who do not leave a Will:

DYING WITHOUT A WILL
Intestate Succession

When no Will exists, Real and Personal property is not distributed according to the decedent’s wishes. Rather, it is distributed according to the statutes of New Jersey.

How will your property be divided if you have no Will? The Chart below shows how an Estate is distributed in New Jersey if you do not leave a Will.

If you die without leaving a Will the State law provides the manner for distributing your property. Your net estate remaining after deduction of debts, taxes, family exemptions, etc., would be distributed under the Statutes governing Decedent’s Estates and, in the case of most common occurrence, the heirs who would receive such property are as follows:

Property owned jointly by husband and wife is automatically owned by the survivor.

The following charts show the distribution of separately owned property. (Effective February 27, 2005)

IF YOU DIE LEAVING:

Survivors (Heirs)	New (2004) UPC
Spouse and parent(s), but no children	Spouse: the first 25% (but not less than $50,000 nor more than $200,000) plus three fourths of the balance Parent(s): All other estate assets
Spouse and children of Decedent, all of whom are also children of spouse (and spouse has no children by any other relationship)	Spouse: 100% of estate Children: nothing
Spouse and children of Decedent, some of whom are not children of spouse	Spouse: the first 25% (but not less than $50,000 nor more than $200,000) plus one half of the balance Children of the Decedent: all other estate assets
Spouse and children of Decedent, all of whom are also children of spouse (and spouse has children by another relationship)	Spouse: the first 25% (but not less than $50,000 nor more than $200,000) plus one half of the balance Children of the Decedent: all other estate assets
Spouse and stepchildren (children of spouse who are not Decedent’s children)	Spouse: 100% of estate Stepchildren: nothing
Children of spouse (stepchildren), but no descendants, parents, descendants of parents or descendants of grandparents	Stepchildren: 100% of estate

Note: shares of predeceased children pass to descendants by representation. The new rules on intestacy say that the decedents inherit “per capita, by generation” rather than “per stirpes.”

However, the State of New Jersey takes your property if you leave no wife or husband; child or its descendants; parent; brother or sister or their descendants; grandparent; or uncle or aunt or their children; or their grandchildren or stepchildren.

NOTE: Any person who fails to survive the decedent by 120 hours is deemed to have predeceased the decedent for purposes of intestate succession.

APPOINTMENT OF ADMINISTRATOR OR PERSONAL REPRESENTATIVE

When there is no Will, an administrator, administratrix, or personal representative is appointed by the Court. Any close relative may be appointed.

For an individual or a bank to be appointed administrator or personal representative, all other heirs must renounce their rights. In most cases, a surety bond must be furnished by paying a premium to a surety company for signing this bond.

The county surrogate, or the Superior Court, grants letters of administration showing the authority to act.

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PROBATE REQUIREMENTS

• Decedent must be a resident of the County of probate, or if a non-resident, decedent died intestate seized of real property in this County
• Certified death certificate
• Original Will or if no Will, immediate next of kin
• Probate fee

APPOINTMENT OF GUARDIAN
A guardian may be appointed by the court for minor children. In order to sell or dispose of a minor’s interest in a parent’s land, a guardian must be appointed by the Superior Court to sign the deed for them. The expense of having the guardian appointed, bond for the guardian, appraisals, court costs and attorney’s fees are charged to the minor.

In some cases, the guardian applies to the court for permission and approval to sell and/or to spend the children’s money for their support or education. The guardian must account for income and disbursements – by the court action if necessary.

HOW A WILL IS PROBATED
Upon the death of the testator or testatrix, the Will is probated. This is the legal process which establishes the genuineness of the Will. It is done by the surrogate or the Superior Court in the county where the testator or testatrix resides at the time of death.

The executor, executrix, or personal representative is appointed by going to the Surrogate Court with the original Will, certified death certificate, and if the Will is not self-proven, at least one of the witnesses who signed the Will must prove his or her signature on the Will.

If the Will, for any reason is not properly executed, the Surrogate’s court and/or an attorney can advise the executor or personal representative as to the proper procedure in order to allow the Will to be admitted to probate.

GUIDELINES FOR EXECUTOR/EXECUTRIX
If you have just probated a Will and have been named Executor, or if you have qualified as Administrator for an estate with no Will, you may be asking yourself the question, “What do I do next?” I am pleased to supply you with some basic guidelines to assist you.  East Coast Law, P.A,  is available either to simply guide you or personally handle as many of the tasks below as required.

1. Notice of probate of the Will must be served on all interested parties within sixty days of probate, advising them of the name and address of the Executor. A copy of the Will may accompany this notice or a copy may be requested. If the Will contains any charitable bequests, notice must also be given to the appropriate State official. You are to file a proof of service by filing an affidavit that all parties were served by personal service, or regular and certified mail. There is a filing fee per page.

2. The Administrator of an intestate estate (no Will) is obligated to notify appropriate State offficials in the event that there are no surviving heirs. In this case, the net proceeds of the estate would escheat to the State of New Jersey.

3. The Executor/Administrator is responsible for determining and marshaling all assets of the estate. An estate checking account is opened from which bills are paid. It may be necessary to secure a Federal ID number for the estate. You can call the IRS AT 800-829-1040 for an ID number.

4. The Executor/Administrator is responsible for all debts, last illness expenses, inheritance and estate taxes, and administrative expenses from the decedent’s assets.

5. The Executor/Administrator is responsible for filing appropriate State and Federal tax forms as applicable, and forwarding any tax payments due.

6. The Executor/Administrator is entitled to a commission (5% in NJ) of the value of the gross estate (for estates up to $200,000.00) and 6% on income.

7. The Executor/Administrator shall prepare an accounting of the estate assets and disbursements and proposed distribution, which accounting may be proved informally by each beneficiary/heir acknowledging his approval of same. In the alternative, the Superior Court of New Jersey approves a Formal Accounting. Filing fee for the Informal Accounting is $5.00 per page.

8. The Executor has the obligation to distribute the net estate in a timely manner, in accordance with the terms of the will. The Administrator distributes in accordance with the intestate laws of the State . A copy of the relevant Statutes is available at the Law Libraries.

9. Prior to the distribution, each beneficiary shall execute a Refunding Bond and Release. Upon receipt of the executed document, the Executor/Administrator issues payment. The original refunding Bonds and Releases are filed with the Surrogate. The filing fee is $5.00 per page.

10.The Executor/Administrator is required by law to initiate a child support enforcement order search for any beneficiary receiving in excess of $2,000.00, prior to distribution of any money to the beneficiary. The search shall be conducted by a private judgment search company that will verify results.

A TRUST
If there is a question as to the ability of your beneficiaries to manage money or if you are in a high tax bracket, your lawyer can set up a trust. A trust may be created by an agreement or by your Will giving property to a third person – trustee – to hold and administer for the benefit of the person named in the trust. A trust may reduce estate, legal and administrative expenses. The trustee is entitled to a fee for such service.

NOTICE OF PROBATE OF WILL
Within 60 days after the date of the probate of a will, the personal representative shall cause to be mailed to all beneficiaries under the will and to all persons who would inherit if there was no will, at their last known addresses, a notice in writing that the will has been probated, the place and date of probate, the name and address of the personal representative and a statement that a copy of the will shall be furnished upon request. Proof of mailing shall be filed with the Surrogate within 10 days thereof. If the names or addresses of any of those persons are not known, or cannot by reasonable inquiry be determined, then a notice of probate of the will shall be published in a newspaper of general circulation in the county naming or identifying those persons as having a possible interest in the probate estate. If by the terms of the will property is devoted to a present or future charitable use or purpose, like notice and a copy of the will shall be mailed to the Attorney General. A TRUST If there is a question as to the ability of your beneficiaries to manage money or if you are in a high tax bracket, ask your lawyer or inquire at a bank about setting up a trust. A trust may be created by an agreement or by your Will giving property to a third person – trustee – to hold and administer for the benefit of the person named in the trust. A trust may reduce estate, legal and administrative expenses. The trustee is entitled to a fee for such service.

JOINT OWNERSHIP
Another way to transfer property is through joint ownership. Real Estate owned by both husband and wife automatically becomes the sole property of the survivor.

If two or more persons other than husband or wife own real estate together, each owns an undivided share as tenants in common, unless the deed states they are to own “as joint tenants and not as tenants in common” or “as joint tenants with right of survivorship” or “JTWROS.”  With exceptions, real estate held in joint ownership goes to the survivor or survivors when one of the joint owners dies. An interest in real estate owned by tenants in common passes to the heirs of the deceased.

Personal property may also be owned jointly with right of survivorship, the survivor becoming the sole owner. Checking accounts, saving accounts, or stocks and bonds may be held in joint ownership with right of survivorships, or as tenants in common.