Administration

So You Need Immediate Access to Decedent’s Assets…

So You Need Immediate Access to Decedent’s Assets…

Your parent died in the middle of winter. Your parent rented out the upstairs portion of their home. The tenant called and said the heater blew and he is withholding rent. Your parents financial advisor just called and said that he needs access to sell some of the portfolio holdings to mitigate loss. And to make matters worse, you just found out that you may have a half-brother, who may be entitled to a portion of the estate.

You are not sure which problem you want to tackle first. But all three problems boil down to the same issue – you need Immediate Access to Decedent’s Assets and make some basic, important, and expeditious decisions on behalf of the decedent.

The solution: Preliminary Letters Testamentary (for when the decedent died with a will) or Temporary Letters of Administration (for when the decedent died without a will).

New York Surrogate’s Court Procedures Act (“SCPA”) Section 1412 allows the fiduciary named in the Decedent’s Will to petition the Court for immediate authority to handle the Decedent’s affairs. Similarly SCPA 901 allows an interested party to petition the Court for immediate authority to handle the Decedent’s affairs.

The Decedent’s fiduciary (be it person named in Will or next of kin who will be handling Decedent’s affairs) should petition the Court and request immediate access. The fiduciary will need to provide a short explanation of why immediate access is necessary, be it to pay bills, have authority to commence an eviction proceeding, have authority to make financial decisions, safeguard property, or repair property. While the fiduciary may have immediate access to funds to ensure the safekeeping of the property and proper administration of the estate, the fiduciary may not distribute any assets to satisfy a legacy or bequest until full letters are issued.

Although the Court may grant immediate access to Decedent’s assets, the Court may also impose limitations. For example, although the Court may allow a fiduciary to pay the bills of the estate, the Court may also limit how much of the assets the fiduciary may collect. The Court may also request that the Fiduciary post a bond as a way to safeguard assets for the rest of the Decedent’s heirs. For example, when the estate may be contested, the Court may want to ensure that Decedent’s assets are protected. (Certain counties, such as Queens, may request that you pay a fee for the filing of the bond.)

Preliminary Letters or Temporary letters are usually valid for 6 months at a time so the fiduciary will need to act quickly and renew if necessary.

In short – yes – immediate access is possible but, with restrictions.

Additional resources provided by the author

For more information, please contact estate planning attorney Regina Kiperman:
Phone: 917-261-4514
Email: rkiperman@gylawny.com
Or visit her at her new location:
Grimaldi & Yeung LLP
80 Maiden Lane
Suite 304
New York, NY 10038

This post is made available by the lawyer for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this site you understand that there is no attorney client relationship between you and the lawyer. The post should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. ATTORNEY ADVERTISING.

Procrastination, Turning 55 & the Essential Legal Documents in Between

Procrastination, Turning 55 & the Essential Legal Documents in Between

Procrastination: A Hidden Trap
by Joanne Seminara, Esq.

When you were young and one of your teachers gave you an assignment that was due in two weeks, did you rush home to complete it? Or were you more likely working to finish it late on the night before it was due?

We all procrastinate. Ok, maybe not when your boss says “I want this on my desk in an hour.” But if no one is looking over your shoulder, it’s a task that requires a certain amount of effort and there’s a cost involved, so it’s easier to say “I’ll get to it later.”

As a lawyer I’ve seen this to the extreme. One week I met two women, both over 100 years old, who both indicated they were in no rush to prepare a Will. That’s a great story to tell over cocktails but I’ve also seen the pain and suffering that comes when tragedy strikes while someone was procrastinating. For example, one day in court I watched a woman crying to the judge because her husband was incapacitated, had never made a Power of Attorney (which meant  that she didn’t have any access to their money) and she was about to lose their house. And her husband was a lawyer.

The most common problem that walks through the door of my office is a family with an elderly mother or father who has to be put into a nursing home. Because they’ve done no planning, rather than have Medicaid foot the bill, $15,000 or more a month is going to have to come out of the elderly person’s assets.  While we can provide some help at this “11th hour,” planning this late results in unavoidably greater cost in terms of stress, finances and delay.  This is a situation that could have easily been prevented with the earlier help of an experienced elder law attorney. But because there’s a “five-year” transfer or “look back” period which can lead to the imposition of a Medicaid penalty period, the necessary legal work must be completed years before nursing home care is required.  And so, due to no planning, family members who would have inherited substantial estate assets pay the high price of procrastination.

Sadly, dementia, often caused by Alzheimer’s disease, is on the rise. Once a dementia sufferer reaches a certain level of cognitive decline, she or he can no longer sign legal papers. And that often means that procrastination will claim financial victims, who are often the spouse or children of their incapacitated loved one, as well.

One reason that people procrastinate in making these plans is that, in our society, we are ill prepared to deal with the concept of death. Death is inevitable and because planning for it requires facing its inevitability many people prefer to push anything having to do with death aside. Which is one reason I wrote “5@55: The Five Essential Legal Documents You Need By Age 55.” 55 is an age when thoughts of dying are probably dim enough not to frighten you away from protecting yourself.

If you’re 55 years of age or older and don’t have a Will, Health Care Proxy, Living Will, Power of Attorney and Digital Diary, I urge you to stop procrastinating in order not to become a victim of Father Time.

 

Joanne Seminara, Esq.
Partner
GRIMALDI & YEUNG LLP
9201 Fourth Avenue, 6th Floor
Brooklyn, NY 11209
Tel:   718-238-6960
Fax:  718-238-3091
jseminara@gylawny.com

 

Partner Regina Kiperman Receives Impressive Summary Judgment for Client

Partner Regina Kiperman Receives Impressive Summary Judgment for Client

Grimaldi & Yeung Partner Regina Kiperman successfully obtained a summary judgment in a contested accounting proceeding on behalf of an estate administrator who was alleged to have misappropriated and converted over $2.6 million dollars.

The estate and our law firm are very satisfied with this decision.

 

For more information, please contact estate planning attorney Regina Kiperman:
Phone: 917-261-4514
Email: rkiperman@gylawny.com
Or visit her at her new location:
Grimaldi & Yeung LLP
80 Maiden Lane
Suite 304
New York, NY 10038

How to Avoid It! – Ancillary (or additional) probate and administration

How to Avoid It! – Ancillary (or additional) probate and administration

Donna owned property in New York and Florida. She did not do any planning during her lifetime. When she retired, she moved down to Florida and lived in Florida full time until her death. After her death, her children begin to wonder how they are going to take ownership of Donna’s property.

When a person dies owning property located outside of their domiciliary state, the decedent’s heirs must bring an ancillary (or another) probate or administration proceeding. This is because a Court that has issued Letters Testamentary or Letters of Administration in one state does not have authority to issue Letters Testamentary or Letters of Administration that are valid in another state. As such, the heirs must obtain legal authority from the state where the property is located to act on that property. Essentially, the heirs must first file for probate in the state of the decedent’s domicile. Then, the heir must bring a second probate / administration proceeding in the state which holds decedent’s additional property.  Having to bring another probate proceeding can add unnecessary cost and delay to the estate.

Who may petition for ancillary probate?

  1. The person expressly appointed in the will as executor with respect to property located within the particular state.
  2. The person to whom domiciliary letters have been issued or if domiciliary letters are not issued, the person appointed in the will to administer all property wherever located.
  3. The person acting in the domiciliary jurisdiction to administer and distribute the testator’s estate.
  4. A person entitled under the SCPA to letters of administration c.t.a. A person entitled to letters of administration c.t.a. is anyone set forth in SCPA 1418(1).

How to avoid ancillary probate?

  1. Place beneficiary designations on your assets
  2. Add a co or joint account or deed holder
  3. Do an inter vivos or lifetime transfer (or lifetime transfer while keeping a life estate)
  4. Transfer the property into a probate avoidance vehicle such as:
  5. Trust (revocable or irrevocable)
  6. LLC
  7. Family Limited Partnership

Additional resources provided by the author

For more information, please contact estate planning attorney Regina Kiperman:
Phone: 917-261-4514
Email: rkiperman@gylawny.com
Or visit her at her new location:
Grimaldi & Yeung LLP
80 Maiden Lane
Suite 304
New York, NY 10038

This post is made available by the lawyer for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this site you understand that there is no attorney client relationship between you and the lawyer. The post should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. ATTORNEY ADVERTISING.

Is a “Lifetime” (or Revocable) Trust for You?

Is a “Lifetime” (or Revocable) Trust for You?

In certain, but not all, situations, it may make sense to create and fund a “lifetime” (or revocable) trust. The below are a few factors you should consider in determining whether such a trust makes sense for you.

Avoid Court Meddling
Many people desire to avoid court intervention in the distribution and division of their assets. People believe that involving the courts drags out the process, delays the distribution of assets, and results in higher legal fees. Establishing a “lifetime” (or revocable) trust may eliminate the need for court intervention.

Note that certain counties may require you to disclose the existence of a revocable trust in the event that you ultimately file for probate. Although you may have to disclose the trust, you will not need to obtain “Letters of Trusteeship” for the trust. Not having to obtain separate “Letters of Trusteeship” eliminates the Court oversight and reduces the administrative burdens.

Ease of Administration
Having a “lifetime” trust allows you to place assets, regardless of size and location into the trust, thereby creating one general operating base. For example, you may decide to place properties held across several states into the trust. You may also decide to transfer bank accounts held with various financial institutions into the trust. This way, all assets may be acted upon uniformly and in accordance with your wishes.

Direct Distribution of your Assets
When you place beneficiary designations on assets, or create joint accounts, you are directing that the entire asset pass, all at once, to the person you have designated. Under such an approach, you are not able to control or temper distributions. If you create a trust however, you may direct that a portion of the funds be held back or delayed or kept in further trust upon the occurrence of a certain event (e.g. beneficiary turning a certain age or reaching a certain milestone).

Creating a trust and controlling further distribution of assets may similarly be beneficial when your beneficiary is, or is expected to, receive government benefits. By controlling distribution, you can help ensure the beneficiary continues to receive those benefits along with the amount you have set aside for them.

Create Flexibility for Future Planning
Creating a lifetime trust is one way to plan for disability or incapacity.

  1. First, by creating a trust, you may be able to provide a smooth succession plan for the management of your assets by specifying, in your trust, who you would prefer to handle the finances in the event of your disability.
  2. Second, in the event you become disabled, all of your assets are already in one place and you can undertake certain acts to prepare for long term care planning (e.g. make the trust irrevocable and commence medicaid planning).

Privacy
The beauty of a trust is the limited number of people who, in the absence of litigation, can access the document. A trust is ordinarily viewable by the creator of the instrument, the trustee(s) of the trust, and the beneficiaries (to the extent of their interest).
If you have nosy family members, or, if you are concerned, for example, about the reaction of one family member to your decision to provide (or not provide) for another family member, then you may opt for a trust

Remember, if you establish a trust, only assets placed into the trust will be subject to the rules of the trust. Therefore, if you do choose to establish a “lifetime” (or revocable) trust, remember to discuss, with your attorney, which assets should be transferred to the trust immediately in order to maximize the effectiveness of the trust.

Additional resources provided by the author

For more information, please contact estate planning attorney Regina Kiperman:
Phone: 917-261-4514
Email: rkiperman@gylawny.com
Or visit her at her new location:
Grimaldi & Yeung LLP
80 Maiden Lane
Suite 304
New York, NY 10038

This post is made available by the lawyer for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this site you understand that there is no attorney client relationship between you and the lawyer. The post should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. ATTORNEY ADVERTISING.