Estate Plan Checklist

power of a will, wills, trusts, estate planning, union and hunterdon counties new jersey

After weeks, months, or maybe even years of procrastinating, you’re finally ready to set up your estate plan. Remember, the sooner you create your estate plan, the sooner you will have peace of mind that your family is taken care of should something happen to you.

Many people who decide to create an estate plan say, I just want a simple plan, nothing fancy. The truth of the matter is that your estate, assets and family members greatly determine the complexity of your estate plan. So while you may want a simple plan that requires very little of your time to set up, the circumstances of your estate and life may dictate otherwise.

Of course you can always make your life easier by running through the following estate plan checklist:

  1. Determine the goal of your estate plan — So, you’ve decided you need an estate plan. Why? What is the ultimate goal of having an estate plan in place? Are you a philanthropist who wants to see your wealth enjoyed by the less fortunate? Maybe you want to leave everything you have to your spouse. Or perhaps your intention is to preserve your legacy for many generations after you’re gone.
  2. Retain an estate planning lawyer — Unless you practice law, you probably don’t know much about estate planning, wills, trusts, healthcare directives and other estate planning mechanisms. When hiring a lawyer, make sure you choose someone who practices estate planning law in your state. And no, don’t attempt to move forward on your own without an estate planning lawyer — this is your legacy after all.
  3. Identify your assets — Prior to setting up an estate plan, you need to be able to identify all assets and property you own. Depending on your financial situation, compiling such a list may require more than a Sunday afternoon.
  4. Identify your executor — If you had to choose one person in your life to handle all your affairs after your death, who would it be? The person you name as your executor must be a trustworthy and competent individual who will ensure the wishes of your last will and testament are carried out.

Now that you’ve successfully gone through this checklist, it’s time to draft your estate plan. To begin the process, make an appointment with your estate planning lawyer as soon as possible. For more information on estate planning in NJ and NY, Contact Alec Borenstein, Esq., at alec@bmcestateplanning.com, or call 908-236-6457.

Understanding “I Love You Wills” in New Jersey

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If you are married and creating or updating your estate plan, you may be considering “I love you Wills.” Essentially, this type of Will leaves all your personal belongings to your spouse in the event of your death, and vice versa.

For many married couples, “I love you Wills” present a more straightforward approach to estate planning — you love your spouse, you leave everything you have to him or her and that’s that.

Yet clients considering “I love you Wills” often wonder, what happens to my Will if my spouse and I get divorced? First of all, you should update your Will during any major life event — births, deaths, new jobs and divorce just to name a few. However, what if you fail to update your Will after divorce? Does your ex still get everything? Fortunately, the State of New Jersey has laws in place to protect divorcees who previously had an “I love you Will” in place.

According to N.J.S.A. § 3B:3-14, there is a revocation of probate and non-probate transfers by divorce or annulment. So, let’s say you are happily married and have an “I love you Will” in place. Then, at some point down the road, you and your spouse get divorced but you forget to update your “I love you Will”. New Jersey law revokes any bequests made to your former spouse and they automatically pass on to your next beneficiaries.

In addition, if your ex-spouse was named the primary executor of your “I love you Will”, worry not — your Will would be probated by the next person you named as executor of your Will. There are only a few ways to “revive” the bequests to spouses in “I love you Wills” after divorce in New Jersey and they are as follows:

  1. Remarriage;
  2. Revocation or nullification of the divorce; or
  3. The execution of a Will or Codicil after divorce.

The statute also revokes any survivorship claims either spouse has in a joint asset. This means that if you and your ex-spouse owned a piece of real estate together, your stake in the property would pass to your other beneficiaries and not to your surviving spouse. N.J.S.A. § 3B:3-14 also revokes the beneficiary rights of your former spouse to your life insurance policy unless otherwise specified in your divorce agreement.

There is no perfect Will for married couples — every relationship is different and requires its own custom tailored estate plan. Whether you are considering an “I love you Will” or need help updating your current estate plan, it is in your best interest to contact an estate planning attorney.

To discuss your NJ estate planning matter today, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com, or call 908-236-6457.

N.J. Estate Tax versus Federal Estate Tax

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If you live in New Jersey and are planning your estate, you may be wondering how the N.J. and federal estate taxes will affect your heirs. Unfortunately, N.J. has both an inheritance tax and an estate tax. Furthermore, the state’s estate tax exemption limit is quite low when compared to the rest of the states in the union.

State exemption limit

The exemption limit in New Jersey as of 2016 is $675,000. If you are the executor of a Will, and the value of the gross estate is more than $675,000, you will have to file a New Jersey estate tax return. However, keep in mind that there are various deductions such as funeral expenses, attorney’s fees, and income tax bills that may reduce the estate value below the exemption limit.

Federal exemption limit

The federal exemption limit as of 2015 is $5.43 million per person, which is up from $5.34 million in 2014. This means that a married couple in 2016 can give away $10.86 million tax free. It also means, that unless the decedent’s gross estate is valued at more than $5.43 million, it won’t have to pay the federal estate tax rate of 40%.

What is meant by “the value of the gross estate”?

Many people make the mistake of assuming the word “estate” refers only to a house. In fact, it encompasses much more. In order to calculate the total value of a decedent’s estate, numerous assets are gathered and assessed, including:

  • New Jersey real estate;
  • Vehicles and other items of personal property;
  • Securities and investment accounts;
  • Funds from retirement account;
  • Business interests such as a sole proprietorship, limited liability company, or small corporation; and
  • Bank accounts and certificates of deposit.

Also keep in mind that any property you leave to your spouse or civil partner is exempt from the NJ estate tax.

Comprehending legal information after losing a loved one can be difficult and frustrating. An experienced attorney can explain estate planning to you in an easily accessible manner so that you and your family can move on with your lives. For more information on estate planning in Union and Hunterdon Counties, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com or call 908-236-6457 today.

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.

Your Duties as the Executor of a Will in New Jersey

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Over the course of your life, you may be asked to serve as the executor of someone’s Will. The job has many important responsibilities and should not be taken lightly. Your primary duties as executor are to gather and manage all property and assets of the estate and ensure they are distributed according to the Will.  If you are named executor of a Will in New Jersey, seek guidance from an experienced estate planning attorney.

In the meantime, review the following list containing the primary obligations of a New Jersey will executor:

  1. Probate — First, you must probate the will, that is, have it “validated” by the court. Once this has been accomplished, you are granted the authority to perform your duties under the provisions of the will.
  2. Manage the decedent’s estate — You must gather and assess the value of all estate property and assets. Additionally, you should hire a professional appraisal company to ensure the estate is assessed at market value. In order to properly manage estate assets, you may be required to operate or even liquidate an estate-owned business.
  3. Handle taxes — Remember, as executor, you are legally responsible for filing required income and estate-tax returns, and for paying any necessary inheritance taxes.
  4. Settle debts — Any outstanding debts owed by the estate should be paid as soon as possible. In many cases, litigation may be required to determine if a claim is valid.
  5. Distribute assets— Once you have paid off all debts and expenses, you can distribute the remaining estate in accordance with the last wishes of the testator.

Will Guardian

In addition to eventually performing the obligations above, you may become the guardian of a Will if the creator of the Will provides you with a copy for safe-keeping. He or she may even provide you with the location of the original document should a will contest dispute arise.

Being the executor of a will is both an honorable and overwhelming experience. Fortunately, with the assistance of an experienced attorney, you can properly execute your loved one’s Will. If you need assistance probating a Will or have general estate planning requests in Hunterdon or Union Counties of New Jersey, contact Alec Borenstein, Esq., at alec@bmcestateplanning.com or call 908-236-6457.

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