Diving In: The Last Will and Testament

Picture it: My office within the last couple of years

I cannot remember exactly when, but I had a consult where an adult son accompanied his mother and with full confidence and pride, told me how he had 1) drafted his mother’s Last Will and Testament, 2) signed it as a witness and 3) was also the Executor. He then showed it to me.

I sat there in complete silence.

I was also appalled.

Do you know why that situation was so problematic?

I am about to tell you by explaining what makes a “Will.” Just a caveat, there are a lot of layers when discussing “Wills.”

Lawyers have written treatises on the subject. Treatises are REALLY big books that take deep dives into different corners of a legal subject and are a reference guide for attorneys.

You will find no treatise here. Remember, this is an elemental series- and a foundation. YOU build on that.

You think you know…but a lot of you don’t

The most well-known estate planning document, by far, is the Last Will and Testament, more commonly known as “a Will.” I think many people have heard sad and downright horrible stories within and outside of their families, about the chaos that can ensue in this document’s absence.

The lack of a Will (and I will be very frank, even its existence) can bring out negative traits in an otherwise “good person,” and can create a monster from a person who already had ill intentions or frayed family ties. Either way, having a Will is far better than not having one.

Therefore, it is the document a potential client will come to me specifically requesting— and nothing else.

No estate planning or elder law attorney worth their law license would ever just draft a will for a person who has never done any type of planning. In my opinion, to do that is malpractice.

I will put this in a different context: If a person is in an accident and both of their arms and legs, all their limbs, were fractured, a physician would cast all four limbs- not just one. All limbs need protection so that bones can fuse back together properly, and the person can resume full mobility.

It is the same with attorneys. It is our responsibility to tell clients what they need, not just go along with that they think they need. More often, they do not know the importance of a document and the long-term consequences of having it versus not.

The Series will go into more detail about this, but I just wanted that point to be clear from the outset.

“Who’s Who” in a Will

Even with most people requesting a Will, many still do not understand the document and its actual function.

We will return to my non-hypothetical from the beginning as a clear example.

·      A Last Will and Testament is a testamentary document. Testamentary means it is a document that creates or transfers an interest or a right to an asset or property. NO ONE, other than the testator and an attorney, should look at this document before the Testator’s death.

  • It should be reviewed and/or revised as necessary. It cannot be utilized in any way prior to the Testator’s death. It becomes important at death.

·      The ONE person who has authority to execute a “Will” is the Testator or Testate(“Testatrix” if you want to be proper and reference a female).

·      When the Testator dies, they become the Decedent.

·      What the Decedent leaves behind in, or outside of, the Will is referred to as an Estate.

At some point after the Decedent’s death, the Will must be submitted to the local Supreme Court (in New York City) in the county where the person died for Probate.

In simple terms, and for this article, it is a judicial proceeding or process that gives a person called an Executor (more on the latter below) the power to collect all the Estate’s assets and distribute them according to the Decedent’s wishes.

The Executor was nominated and named in the Decedent’s Will.

·      Who drafts, or writes, a Will? An Attorney. More specifically, an attorney with experience. Even more explicitly, an Estate Planning and/or Elder Law Attorney who has built a practice around this area of law.

  • This is not snobbery. If a cardiologist cannot diagnose neurological conditions, then an Intellectual Property lawyer whose practice focuses almost exclusively in that area, does not have the experience or knowledge base to handle these types of matters.
  • Your son or daughter, even if they are an attorney, is not an acceptable draftsman. If they are your niece or nephew, then a BIG maybe. In my example, he was not an attorney.
  •  A Staples do it yourself “Will Kit” is not acceptable. Sorry Staples, I like buying my office supplies from you, but I would never go to you for my estate planning needs.
  • You cannot write your own Will, and your high education level or superb writing ability is irrelevant. Will drafting is more technical than creative.

·      A Testator leaves specific assets to the person or persons they name, and this class of people are generally known as Beneficiaries, or Designated Beneficiaries. Some people will use the word “heirs.”

  • A beneficiary can be a spouse, child or family member, a friend, an organization or institution.
  • In my example the son who was the Will draftsman was a beneficiary of his mother’s estate.
  • A beneficiary cannot draft a Will from which they expect to receive an inheritance. So, if your attorney nephew is a beneficiary he cannot draft it. If your favorite attorney is a beneficiary, they cannot draft it either.

NOTE: Residuary Beneficiary is a beneficiary who is not left a specific bequest (gift/asset) in the Will. A very simple example of a specific bequest followed by a Residuary Clause is:

I leave (or give/devise/bequeath- they all mean the same thing) my primary residence, located at 123 Mockingbird Lane, New York, NY 10023 to my wife, Jane Smith.

I leave the rest, remainder and residue of my estate, both real and personal, of whatever nature and wherever situated, real or personal property, tangible or intangible, to my only daughter Joanie Smith.”

All those words are meant to cover our butts, I mean, bases. Our aim is to be thorough after all.  

·      Every Last Will and Testament execution (signing) must be witnessed. The Witnesses,two to three of them, should be non-family members or, if family members, those who are not beneficiaries listed in the Will.

  • The purpose of the witnesses is to maintain the integrity of the process. In other words, 1) attest to the testator’s sound mind- their orientation to self, time and place and 2) ensure others that the testator was not unduly influenced, under duress or pressure to sign the document when executed.
  • The witnesses will sign a Self-Proving Affidavit attesting to what I just wrote above.

·      Who carries out the Testator’s wishes? The Executor.

  • The Executor can also be a beneficiary of the Will, but it is not necessary.
  • They can be a family member or a friend.
  • They can be a trusted professional, like an attorney, a financial advisor or accountant.
  • Most importantly, they need to trustworthy people.  Executors have a very important job and what is known as a “fiduciary responsibility” or duty to the beneficiaries. They must be accountable to the beneficiaries for all the assets in the estate, answer all questions, and ensure all assets are given to the named beneficiaries, in the manner intended and that the Estate closes properly.
  • If an Executor does not do their job or if they steal from the Estate, you can have them removed.

There should ALWAYS be an alternate Executor named in the Will, in the event of the Executor’s death, illness, misconduct or deciding to step down from or discontinue the role.

What can go “in” a Will?

Almost everything.

Property: “real property” like a primary residence and other residential or commercial properties you may own.

Property: “personal property” like the objects within your home, your favorite watch, your grandmother’s china set, or your mother’s engagement ring or sentimental objects with great personal value but no great monetary one.

This category includes vehicles for the road, a vessel for the water or, why can’t it—an aircraft for flight in the skies.

Intellectual Property: music compositions or master recordings, original artwork, designs, manuscripts, your written work product or ideas etc. Anything you physically create or anything you create or own in the digital space or “cloud.” And this even includes access to your online accounts.

NOTE: There are more sophisticated techniques to protect property, but remember this Series is elemental. A Will is better than NO Will for almost any property. It’s protection. It is stated wishes, not guesswork.

I will briefly mention property that is non-probate and that can pass outside of a Court proceeding and, for some, AS LONG AS A (INSTITUTIONAL) BENEFICIARY FORM OR DESIGNATION has been completed:

·      Retirement accounts

·      Pension (plan)

·      Life Insurance

·      Property held by two people, a “joint tenancy with right of survivorship” or as “tenants by the entirety”

·      Property held in the name of a revocable or irrevocable Trust

·      Joint Savings Account (Checking accounts are not included here)

·      A bank account “held in Trust for” another person

This is your “primer” on the Last Will and Testament.

I bet you are wondering what happened to the adult son and his mother I mentioned at the beginning of this article? I told him that his mother’s bequests to him in the Last Will and Testament would not survive for the mere fact that he “drafted” a Will where he is an Executor and Beneficiary. If there were other irregularities in the Will drafting (which there were) and in the signing ceremony (which there likely were), the Will could be declared a nullity.

I never heard back from him.

You can’t help everyone, unfortunately.

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If you’d like to learn more about me and my law practice you can go here or, si hablas español, here.

 

Why I am Doing This

A number of months ago, LinkedIn invited me to their Series “pilot,” and I began to publish my Series, “Elder and Special Needs Law in a ‘New York Minute'”

I am reproducing the Series here every week.

Super thankful to have been invited to this Series pilot. I must write that as a first sentence.

Now, I will tell you why I titled it “Elder and Special Needs Law in a New York Minute.”

I was born, raised, live and practice law in New York City. It is a fast-paced city, where people oftentimes need an answer—succinctly and quickly.

Elder and Special Needs Law is not a sexy topic, I can admit that.  However, I will strenuously argue that it is important, even vital, to every single person including…you.  If you have not been touched by these areas of law (yet), you will be and already know a person or persons who have confronted legal issues associated with aging, a special needs child or both.

Unfortunately, and all too often, people’s decision to plan is reactive, as opposed to proactive. What I mean by this is, 1) they never thought about, 2) did not want to think about, 3) did not think it was their time to think about it yet (i.e. too young), or 4) thought it was too costly to do…until they could no longer avoid it.  Fear is one contributing factor to this “procrastination,” but cultural taboos around aging, illness, money and death are others.

When they finally decide to plan, some are surprised, disappointed or frustrated to realize that waiting left them with less than desirable options. In these areas of law, time is not necessarily your friend.

The purpose of the series will be to break down these two areas of law into its components, starting with the basics of estate planning and branching out into Elder Law and then Special Needs. When people ask me what Elder Law is, I always reply that it is a “sibling” to Trusts and Estates. Like real siblings, they share important characteristics but are clearly distinct from one another. I characterize Special Needs Law as the youngest, the “baby.”

I am here to teach. I am here to impart understanding. I am here to demystify these areas of law. I do not want people to be afraid.  I promise not to overload you with information. On the contrary, I hope to assist you in creating a foundation, a foundation that is important now, no matter your age, and well into your future.  

If you’d like to learn more about me and my law practice you can go here or, si hablas español, here.

The Tragic Case of Peter Knoll: What Legal Steps Could Have Prevented His Death?

This morning, I was reading the newspaper– on my smartphone– when a headline grabbed my attention: “Battle Erupts Over Estate of Wealthy Recluse Who Froze to Death Inside his Upper East Side Mansion (you can read the article here http://www.nydailynews.com/new-york/ny-metro-battle-estate-upper-east-side-man-20180722-story.html).

Reading this article led me to another one published on April 23, 2018, a number of months after his death that winter (read here: http://www.nydailynews.com/new-york/manhattan/hypothermia-kills-75-year-old-man-upper-east-side-townhouse-article-1.3949019).

Peter Knoll, a 75 year old Manhattanite and son of a furniture magnate,  froze to death in his apartment.  Con Edison had shut off his utilities in 2014. However and very unfortunately,  they failed to notify the proper adult protective and other city authorities so Mr. Knoll suffered in silence until his death. His close circle of family and friends evidently knew he had no heat in his home, but…nothing was ever said by anyone (as far as we know).

Publicly, there is not a lot known about his life in those last years. There is a brief mention of physical ailments, but the public record is largely silent on whether or not he suffered from any condition that cognitively or psychologically impaired him. My suspicion is that Mr. Knoll was not in his right frame of mind.  And I have some thoughts on that, but before I get to that…

In my professional experience, older people who live alone are often isolated-particularly if they live in a private residence–unless they have involved family or friends to supervise or otherwise “check in” on them.  This is why many older people and their loved ones, opt to have them reside in 1) senior living communities or 2) an assisted living residence. A third option, if finances permit, is to hire professional live in help. If problems arise, they will become known sooner.

It is shocking and tragic that a man of Mr. Knoll’s immense financial  resources would have been left to suffer alone. He had enough assets to not only live comfortably the rest of his days but to have others attend to his every need- without him ever having to leave his home, or ever becoming impoverished as a result.

The solution to this inevitable tragedy? Properly executed “Advance Directives,” individually known as a Health Proxy (for medical decisions) and a Power of Attorney (for everything non-medical). These documents are in effect during a period of incapacity. If these documents were never executed,  then the option would be an Article 81 Proceeding a.k.a. Adult Guardianship

I have been involved in Article 81 proceedings for a number of years and have worn every hat imaginable: 1. Petitioner’s Counsel, 2) Court Evaluator (the Judges’ “eyes and ears,”), 3) Counsel for the Alleged Incapacitated Person (AIP) and 4) Permanent Guardian.  Briefly, this proceeding is filed in Supreme Court (a trial court)  to request from the “Court” (the Judge) that a Guardian be appointed to care for the personal needs and property management of an “Alleged Incapacitated Person.” Yes, there is a hearing. Sometimes they are uncontested, other times they are quite contested. The AIP can consent, but sometimes they do not and then there are those who cannot.

In the end, the Judge determines if the person is incapacitated and how this incapacity could further harm them without the appointment of a Guardian.

Based on the brewing estate “battle” and the allegations by one of Mr. Knoll’s adult sons that others took advantage of his father’s “frail physical and mental state,” it seems it was known, at least by some, that Mr. Knoll was not well.

So why did nothing happen? I have absolutely no idea.  And if I were to put forth theories, this blog post would become even longer and I would become even more incensed.

My biggest takeaways from his story:

  1. Even all the money in the world cannot protect you, when people choose to remain silent.
  2. Watch over older people you know, in your family and community.  It really is our responsibility.
  3.  In Spanish there is a saying, “Hoy por ti, mañana por mi” which means “Today for you, tomorrow for me.” Treat others how you would want to be treated. Getting to old age is a privilege and it should happen with dignity.

 

Your government will not take care of you…so you have to: a post on paying for long-term care

A few months ago, I gave a brief presentation on long term care for the elderly and disabled. As I contemplate my own mortality, that of my parents and the people I come into contact daily– I thought I’d write a post about it. It’s a little long, but I promise you’ll learn something valuable.

Americans tend to think, “I have medical insurance so I’m covered.” And while this may be true for routine medical care, doctor’s visits, prescriptions and in-patient hospitalization and some types of rehabilitation, it does not extend to long-term care.

What is long-term care? I could define it, but the National Institutes of Health does a better job explaining it.

When we hear “long-term care” we often visualize an older person, but that is not always the case. Anyone can become ill at any time and require long term care in a facility.  As Americans we are living longer due to better medical care, advances in science, environmental factors and, if you’re lucky, good genes. Inevitably, no matter your genes, you will become ill. We just do not know from what-or when.

Most of us are not prepared to finance our long term stays in a nursing home. And it’s expensive, more expensive than paying for one year of university (private or public), a wedding and in some states, a year’s worth of mortgage payments. During my presentation I referenced this infographic and the dollars and cents really do make it real. It is worth a look.

Thankfully, there are ways to plan the financing of long term care. The earlier you do it, the more options you have. While none of the options are cheap, the later options are much more costly – and I am not just referring to money.

a) Private pay. This is exactly what it means. You or a loved one pays out of pocket for your long-term in care in a facility. Most of us will far outlive our savings, especially in light of the very high financial cost associated with aging.

But, if you are one of the relatively few who find themselves in the exclusive tax bracket of “exceedingly wealthy”- congratulations. Now, for the rest of us.

b) Long-term care insurance (LTC). I could tell you what it is, but the National Institutes of Health (NIH) does a better job of defining it here. It is insurance that you pay for so that it can take care of you should you need it.  Since I am a huge infographic fan here is another one, from 2013, that illustrates rates of  LTC insurance acceptance and rejection based on age, as well as the cost to maintain it

Again, the earlier you plan the better off you are. Because once you become ill, this type of insurance is no longer available to you.

One caveat: LTC insurance will likely not cover your entire long term care needs for the time you will require it. The latter is assuming you live past the period for which it will cover your needs i.e. the money runs out before you die. LTC insurance is meant to be a cushion of sorts, to delay or prevent spending out of pocket, parting with your assets, or applying for Medicaid. Applying for Medicaid is the next step for many, but it is not without challenges.

c) Medicaid. It is a needs based insurance program. In simplest terms, you must meet certain income and resource limits in order to qualify. And those limits are low- and in some people’s opinions- almost near indigency.

About 2/3 of nursing home residents rely on Medicaid for their medical coverage and a majority of those people worked with an attorney in order to qualify because they had “too much” in assets. And you’d be surprised to learn what “too much” is.

Unlike long term care insurance, Medicaid does not “run out” and will continue to cover your medical care —as long as you meet income and resource eligibility. It can quite possibly cover your long term care needs until your death. Very important, Medicaid is the only health insurance that covers long term care; Medicare has never and will never do so.

This link provides a succinct overview of the income and resource limits required in my home state, New York.

d) Reverse Mortgage. This is an option for individuals who are at least 62 years old and have either paid off their mortgage completely or have way more equity in their home than a mortgage balance. The amount of the reverse mortgage should be sufficient to pay off their mortgage (if necessary), live in the home and maintain it, pay off bills or debts of any kind, fund home renovations or to have a “nest egg” for the unexpected.

You can obtain a reverse mortgage and never touch a penny of it.  I have little experience with reverse mortgages, so I will let US. Department of Housing and Urban Development (HUD) provide further information here.

Lastly, and as a bonus for reading this post to the end, is one last infographic painting a literal picture of financing aging in the U.S.  Pictures definitely tell a story.

Do yourself a big favor, plan and plan early…and share this post with others!

My forthcoming post will be about how legal protection, in the form of a trust document (and other legal mechanisms), can safeguard your assets as you anticipate long term care needs in your future. To properly plan, you will need a lawyer in your corner.

To learn more about me, visit my law practice website here and connect with me on Twitter, Facebook and Google + 

It can never be too early, but it can always be too late

As a solo practitioner, I now find myself doing a lot of networking. In recent months the phrase, “It can never be too early, but it can always be too late” has become a part of my lawyer lexicon. I think it is a phrase that is applicable to certain parts of our lives, but it definitely applies when speaking about what I do– mainly the practice of elder law and trusts and estates.

I generally deal with an older population- people who have lived life,  gained insight and experience (or maybe not) and, at the very least,  have a life to reflect on. But I also meet with younger people: single, married, with or without children, whose own  experiences have influenced their life outlook.  There is never a right age to plan for the future- it really depends on the person and their circumstances.  Some people need to feel “ready” to do so. News flash–you’ll never be 100% ready for anything.

People procrastinate when it comes to estate planning. My own parents did it, so it does not surprise me. I think estate planning, in general, really forces us to confront  our own mortality and to literally take stock of our lives– and our life’s work.

We will all die one day. You do not know when or how, but you know it will happen. This a scary thought for many of us. Who wants to think about drafting a will where you decide who gets what when you die…before you actually do? Morbid? No. I just call it smart.

I  hope to be a very old lady who dies peacefully in her sleep. I want to age and die with dignity, like everyone should. But I do not call the shots when it comes to my aging and dying– that is genetics and the luck of the draw.  Who wants to think about what happens if you can no longer take care of yourself or live independently? Who wants to think about who will make medical decisions for you if you can  no longer make those decisions competently? Scary stuff. Scarier still? Leaving those decisions to someone you would not have chosen to make them for you- just because you did not make that election when you had the opportunity.

I was taught from a young age that we have to confront the things that scare us in order to move forward.  I have learned that when I have confronted frightening situations: 1) I am stronger than I thought, 2) What I thought was scary really was not, and 3) That everything in life comes and passes. As quickly as it came, it can also go away.  In sum, we overcome.  Survival is what human beings do best.

Do not be afraid. Confront your mortality head on. Plan ahead.  Believe me, you will fee a lot of better if you do. Who does not like being in the driver’s seat?

Children and the Elderly- getting the short end of the stick?

I usually write about the law and its relevancy to my practice areas. However, I just started to think about how so much of my work (and my clients) are impacted by external forces that are beyond our control. These forces affect how effectively I can  do my job and how my clients will live. We are living in very difficult economic times, that some people refer to as the worst economic depression the United States- and the world– has seen in years (second only to the Great Depression).

All of us,  to different extents, have had to practice “austerity”- i.e. the tightening of the purse strings,  doing more with less, putting ourselves on a spending “diet,” and using less plastic and more green –or in many instances, counting our pennies and putting them away.

We have also felt the repercussions of our fragile economic state in the programs that support the most vulnerable in our population- children and the elderly. In my 30 something years on this Earth, I have learned that when times get tough, programs benefiting children and the elderly are always the first to get a good trimming or axed altogether. I admit that these programs are very expensive to administer, however I refuse to look at everything as dollars and cents all the time. I think it is important to look at the dividends these programs yield- that have absolutely no monetary value.

Some of these programs give children a “head start” in life –literally, or provide their parents the opportunity to work and better their lives while the children are being cared for in government subsidized day cares, or allow them to feed their family when they can’t afford groceries.  Others, allow otherwise home bound seniors to receive a nice hot meal, once– or sometimes twice– per day.  Or they run the risk of eating poorly,  not eating at all or burning down the house. I could go on– and on- about the  issues, but I realize this is a blog post not a chapter in a book . And I COULD write a book about my thoughts (just ask any of my close friends, if you know them)

My point is this, if you offer children better opportunities as they begin life you are leveling the playing field and giving them a better chance at having a brighter future.  If you cut off their opportunities early in life, you are basically telling them they aren’t worth the effort– not as much as more affluent children.   If you offer the elderly basic human services as they enter the twilight of their years, you are bestowing upon them the dignity and respect they deserve after contributing to our society during their most productive years.  They are old; not disposable.

Whenever I see someone going through rough times, I say to myself, “There but for the grace of God, go I.”  And it’s true. Anything that is given can also be taken away. Never think it  can’t be you– or someone you know and love. I just wish our legislature saw it that way too…my next post will be about the proposed cuts to existing programs- like Medicaid and home care– for the elderly…which has me scared for my elderly clients. Coming soon.

Having “The Talk” with your Parents

Yeah, I know it can be uncomfortable to talk about these kinds of things with your parents. They come from a different time (and sometimes a different country)where these topics are  taboo,  but it has to be done.  I’ve done it repeatedly and it wasn’t as bad as I thought.  Come to think of it, it was cathartic and I know my parents felt good about it too.

No, I am not talking about the “birds and the bees.” What I am talking about is health, death and money.

We’d all like to think that our parents will live to a ripe old age, without infirmities and  pass away snug in their beds.   I know I want that for myself- and for my parents- but the reality is that all of us will die of something. Health and Death are not topics to shy away from.  On the contrary, you need to have these discussions with your parents while they are still alive and have the capacity to meaningfully talk about these issues with you. You also need to have this discussion with yourself about your own health and wishes.

The below is a succinct and general post that provides an overview of  the legal documents that serve to protect your parents’ wishes regarding their health, money and death.

Health: Does your parent (or parents) want to be kept alive by artificial means if they were to suffer from a catastrophic injury or illness that would severely impact their quality of life?  Whether the answer is yes or no, your parent needs a Living Will. While the latter is not legally enforceable in New York State, it is a document that is recognized and respected by medical personnel.  Click here to download a copy to read.  It expressly states a person’s wishes regarding medical treatment, artificial respiration and the appointment of a health care agent to carry out those wishes.  In addition, a Health Care Proxy, which is legally recognized,  is also strongly recommended. Like a Living Will, it memorializes a person’s wishes regarding end of life issues but it is a general power regarding medical care and treatment should the principal become disabled. Click here to download a copy to read.

They have religiously conscious health care proxies too, like a Halachic Health Care Proxy that aligns with Jewish law.  Click here to download a copy to read.  In addition, there are reading materials on the internet for Catholic and Orthodox Christians, as well as other denominations, regarding the use of health care proxies.

Money: Does your parent (or parents) have a Last Will and Testament? They should, no matter how big or small their “estate” is. If your parent dies without a will it means they died ” intestate,” which means a headache to obtain and/or dispose of their assets-plus Uncle Sam will take a nice chunk out of it before it ever gets to the beneficiaries.  For some assets, a  Trust is an even better testamentary document for the disposition of assets.  There are different types of trusts and each has a specific function and objective.  And last but not least, the never to be forgotten Power of Attorney.  Necessary.  End of story.

Death: The “Last Will and Testament” can express the testator’s wishes regarding burial or disposition of remains, as well as who or what will pay for it.  In my opinion, there is an even more important document that everyone should have in their legal arsenal,  the  “Appointment of Agent to Control Disposition of Remains. Click here to download your own copy. It can designate how  remains are to be disposed (i.e. burial, cremation, spreading of ashes, being buried in your favorite dress, etc.) as well as whether  there will be a wake for the deceased, an open or closed casket,  a religious ceremony (a service or Mass), a graveside prayer, or no prayer at all.

These topics may not be easy to talk about, but once you do and they put their wishes in writing, you will feel as if a big weight has been lifted. I would even venture to say, it’s a good feeling.

So go and have “the talk” with mom and dad, or anyone else you care about.