More Help for Modest Estates in New Jersey

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For people of modest means, the estate administration process often adds legal and administrative expenses that serve only to reduce the amount of the estate that passes onto heirs. In addition to these hard costs, a lot of the heirs’ time and energy can be lost at a time when they are likely already grieving the loss of a loved one. It hardly seems worth it to process these modest estates.

Fortunately, the State of New Jersey recognizes the burden that estate administration can place on people of modest means and thus always allowed intestate estates valued at less than $20,000.00 to pass to a surviving spouse or partner without the need for administration. An intestate estate is an estate where there is no Will.

Recently, the New Jersey State Legislature passed two new laws which expand upon this policy. First, the amount that can be transferred to a surviving spouse or partner has been increased to $50,000.00. This adjustment will allow a much larger number of estates to pass without administration and should serve to alleviate unnecessary stress on many New Jersey families.

If the decedent does not have a surviving spouse or partner, the maximum amount that could pass was previously $10,000.00, but that amount has also been increased and is now $20,000.00.

The second law assists some of the State’s least financially secure individuals — nursing home patients. Under this new law, nursing homes are required to work with residents to help them designate a beneficiary who will be entitled to any personal needs allowance funds that amount to $1,000.00 or less. The named beneficiary will usually be able to take these monies without administration.

If you have questions regarding your eligibility, or the eligibility of a loved one, under the provisions of either of these laws, consult with a lawyer as soon as possible. For residents of New York and New Jersey seeking estate planning assistance, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com, or call 908-236-6457.

Will New Jersey Take a Gas Tax in Exchange for Repeal of the Inheritance Tax?

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New Jersey is one of the last states to still have the loathed inheritance tax. To make matters worse for New Jerseyans, the state has the lowest estate tax exemption limit — $675,000. For years members of various political groups have called for a repeal of the state inheritance and estate tax laws. Will they finally achieve their goal?

A recent plan has been in the works to offer some form of tax cut on the current inheritance and estate tax which is tied to an increase in gas prices. Basically, let’s pay for a tax cut by charging more for gas throughout the state.

Who will the new law affect if it passes?

In the unlikely event that this proposed gas tax-estate tax tie-in plan comes to fruition, it will affect everyone in the state. The current estate tax exemption is $675,000, ridiculously low and still a substantial amount of money for the average American. A tax cut would raise this limit considerably, helping the wealthiest members of the state while hitting the middle and lower-middle class the hardest.

As for the inheritance tax, no tax is imposed on class A beneficiaries (father, mother, grandparent, descendant, spouse, civil union partner, or domestic partner). For beneficiaries who are subjected to the inheritance tax, the current rate is between 11-16%. So basically, if your uncle leaves you an estate, it is subject to an 11-16% tax from the start. If the total value of the estate exceeds $675,000, you also have to pay an estate tax. If the new law passes, the inheritance and estate tax laws will take a cut but the price per gallon for gas will go up as a result.

Considering that fewer than five percent of estates are affected by the estate tax, the plan may not be worth it. Many economists say the numbers don’t add up, especially since the inheritance tax and estate tax combined equal New Jersey’s third largest source of tax revenue.

If you have questions about the N.J. estate tax, or need help probating a will, consult with an experienced attorney as soon as possible. For legal assistance with estate planning matters in Hunterdon and Union Counties, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com or call 908-236-6457.

Common Questions about New Jersey Estate Administration

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Becoming the Executor or personal representative of an estate is an important, yet often confusing, responsibility. Should a loved one or relative appoint you as Executor of their estate, you should contact an attorney. He/she can immediately alleviate much of the stress and confusion you experience as a result of your new obligation.

To further achieve that end, following are some common questions about NJ estate administration:

  • What is probate? — Probate is the legal process of validating a Will. To begin the probate process, go to the Surrogates Court with the original Will and the certificate of death. If the Will is not self-proven, one of the witnesses at the Will signing must validate the signature on the Will.
  • When do state inheritance taxes have to be paid? — In New Jersey, you must pay state inheritance taxes within eight months of the decedent’s death.
  • How can I retrieve a Will from a safety deposit box? — If you are the Executor of the Will, bring a copy of the Will with you that names you as the Executor. In some cases, a bank will allow the Executor to retrieve a Will with him or her present.
  • Do I have to serve as Executor of a will? — No, there is no law requiring you to serve as Executor of a Will. You may renounce your duty as Executor and the job will pass to the contingent executor if any exists. If there is no contingent executor, an Administrator will be appointed in accordance with the state’s intestacy laws.
  • How long does the probate process take? — The duration of the probate process depends on the complexity of the estate and the clarity and thoroughness of the Will. A vague Will may lead to a Will Contest, delaying the process further. Some large estates can take months or even years to settle.
  • What happens if there is no Will? — If no Will exists, an Administrator will be appointed to the estate and assets and property will be distributed based on New Jersey’s intestacy laws.

The job of an Executor can be daunting. Unless you have a background in law, you should not attempt the probate process alone. In the event you need help understanding estate administration in Hunterdon and Union Counties, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com or call 908-236-6457.

Understanding New York Estate Administration

Any type of legal matter should be handled by an experienced attorney, especially estate planning. After all, estate planning is about the legacy you leave behind to your loved ones. In the event that you need help probating a will in New York, you should familiarize yourself with the State’s administration and probate basics. By having a general understanding of how the process works you will be better prepared when you meet with your estate planning attorney.

Some basics

Unless you are an attorney or have already been involved in estate planning, many of the legal terms used in the process may be confusing for you. First, you should know that when we talk about an “estate,” we are discussing a legal entity that holds the assets, rights and obligations of a deceased person.

Additionally, you should be aware that probate is the process by which the NY Surrogate court validates a last will and testament. In many cases, people try to avoid probate to save time and money and to maintain privacy. Should no will exist, the descendant’s estate will be disposed of through administration proceedings following state intestacy laws.

Administration proceedings

When you die in New York without a will, the State must appoint an administrator to handle the distribution of your estate. According to N.Y.

statute, an administrator is chosen in the following order:

  1. The spouse of the deceased;
  2. If no spouse exists, then it passes to the decedent‘s children;
  3. If the descendent has no children, then it passes to decedent’s mother/father;
  4. Should the descendent have no surviving parents, the decedent’s sisters or brothers are next in line;
  5. The grandparents may be appointed if none of the above individuals exist.

If more than one person is eligible, they must settle the dispute and choose an administrator. Any disputes that remain unsettled will be handled by the Surrogates court. It is important to understand that the administrator has many responsibilities including, but not limited to:

  • Locating and gathering all estate assets;
  • Opening an estate account;
  • Managing estate assets;
  • Acquiring an estate identification number from the IRS;
  • Paying any estate taxes that might be due;
  • Paying any debts owed by the decedent;
  • Distribution of the remaining estate assets.

Like all areas of law, estate planning can become very complicated very fast. For experienced guidance with an estate planning matter in New York or Union or Hunterdon counties of New Jersey, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com or call 908-236-6457 today.

What are Your Responsibilities as an Estate Administrator in New York State?

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Contrary to what you may have heard, an administrator is not the same as an executor. An executor is a person named in a will to carry out the descendant’s last wishes. The job of the administrator, on the other hand, is to ensure the estate of the descendant is processed in accordance with the state’s intestacy laws. In addition, an administrator is appointed by the Surrogate Court in the event that no will exists.

If you are appointed administrator of an estate in New York, your first move should be to contact your attorney. Your lawyer can explain the process and guide you through the necessary steps. Following is a basic checklist of tasks you’ll want to take care of immediately:

  1. Identify and list out the decedent’s assets.
  2. Contact financial institutions and notify them of the death and that you have been appointed administrator of the estate.
  3. Have real and personal property, including furniture, jewelry, art, collectibles, automobiles, etc., professionally appraised.
  4. Open an estate checking account.
  5. Find out if there are creditors of the estate and if their claims are valid. If their claims are valid, consult with your lawyer on how to proceed.
  6. Pay off all estate expenses including court fees, appraisal costs, funeral expenses, attorney fees, etc.
  7. Create a journal and record all financial transactions related to the administration of the estate.
  8. If required, be sure to have the decedent’s last income tax return and estate income tax returns organized and filed.
  9. Distribute the balance of estate funds to the surviving beneficiaries.

It is important to remember that you are appointed by the court and you should take your responsibilities as an estate administrator seriously. If state or federal taxes are owed on the estate, be sure to file them correctly and on time. A failure to do so may result in penalties against you.

Recently appointed executor/administrator of an estate in NY or New Jersey? Without proper legal guidance, you could find yourself in over your head. An experienced estate planning lawyer can assist you in obtaining and filling out paper work, understanding the probate process and creating an estate plan of your own. For estate planning help in Union and Hunterdon Counties, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com or call 908-236-6457 today.

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