Probate lawyers in Monroe County and our neighbors in Ontario, Wayne and Livingston Counties are well aware of the hassles and headaches that families face when a loved one’s estate goes into probate. The process can drag out, eating up not just time but also resources that would have otherwise gone to beneficiaries. Appointed executors find themselves with burdensome responsibilities that can compound their grief. In order to navigate the process as quickly and smoothly as possible, probate lawyers recommend you keep the following in mind:
Probate Tip #1: Hire an Experienced Estates Attorney
It may be tempting to navigate probate and estate administration alone, but a good estates lawyer will be able to make the entire process more efficient. The attorney’s expertise will guide you steadily in the right direction and experienced paralegals who do this type of work daily keep you on track for completing the administration as quickly as possible.
Probate Tip #2: Determine Creditors Quickly
Part of the probate process is determining debts and notifying creditors to cut off potential late fees and penalties. Determine debts and expenses as quickly as possible to be able to keep the process flowing smoothly.
Probate Tip #3: Prepare Detailed Records Contemporaneously
An asset inventory will need to be filed with the Surrogate’s Court as part of the administration process. As the executor or administrator works with the estate, he or she should be creating an inventory of its assets and getting appraisals when appropriate, whether on personal effects, real estate, or other assets. Copies of all financials should be provided to the law firm assisting with the administration to avoid the expense of research and trying to recreate records.
Probate Tip #4: Don’t Miss Deadlines
There are specific deadlines set for when documents need to be filed. Missing these deadlines will lead to keeping the matter open longer, possibly result in additional tax return filings and could necessitate additional court appearances.
Probate Tip #5: Keep Accurate Records
The creditor claim period can vary from state to state, which is another excellent reason to work with a local estates attorney. Once this period has ended, the executor will file the final report and accounting. Beneficiaries are entitled to a detailed accounting of the executor’s actions. Having these numbers ready to go and double checking them for accuracy helps get the estate closed faster.
There’s no doubt that seeing an estate through the administration process creates stress and potential confusion. A good estates lawyer and the firm’s experienced team will minimize this stress, and utilizing these simple probate tips can get the estate and all those connected to it through the process that much faster.
Unless you were living under a rock, you most likely heard about the tax reform bill that was passed by Congress and signed by the President over the holidays. One big change that came out of it was the doubling of the exemption amount for federal estate, gift, and generation-skipping transfer taxes.
Beginning in 2018, the exemption for federal estate, gift, and generation-skipping taxes increased from a $5 million base to $10 million. That amount was annually adjusted for inflation which makes the exemption $11.2 million, or $22.4 million for a married couple in 2018. This means that you can pass down a total of $11.2 million (or $22.4 million if you’re married) to heirs without incurring any federal estate taxes.
Of course, planning to minimize or avoid estate taxes has always been a traditional benefit of estate planning. If taxes were your primary concern, you may be thinking that you can now neglect planning in light of these legislative changes. But, that would be a mistake.
Estate planning is about much more than avoiding taxes. Good estate planning will ensure that your financial and medical wishes are followed if you become incapacitated and when you pass away. Estate planning further allows you to direct how your assets are divided and to whom they should pass. Also, if you have minor children, you can select who you want to care for them if you die, rather than leaving the determination to a judge who doesn’t know you or your family and who may have multiple individuals arguing over who should fill that role.
It is critical to note that the new estate tax exemption only lasts for a set number of years. After 2025, under the terms of the act, the exemption would revert back to the $5 million base. Further, the next presidential election could roll it back even more. If you have accumulated sufficient wealth, you should consider making gifts before the sunset provision takes effect after 2025 – or earlier, depending on the next election cycle.
For New York residents we still have our own estate tax that needs to be reviewed in light of your family wealth and in light of the changes to the income tax regime we are strongly recommending that our clients review their planning, especially business owners who may benefit from an entity change or restructuring. So, rather than the tax law changes lessening the need to plan, there are plenty of important issues that require an experienced Finger Lakes estate planning attorney.
The doubling of the estate exemption was historic. There’s really no precedent, so we can’t look to the past for clues about what will happen next. The important thing to remember is that the pendulum can easily swing the other way, and it is critical that you are prepared for that possibility. Rather than live with uncertainty, schedule a review meeting and talk to one of our knowledgeable Finger Lakes area estate planning attorneys about how to best plan for the state of your affairs both now and in the future. If you would like to schedule your planning session call (585) 232-5300 and be sure to mention whether you prefer to visit our Rochester, Newark or Canandaigua office.
The Achieving a Better Life Experience (ABLE) Act, which was created by Congress in 2014, allows people with disabilities and their families to save up to $100,000 in accounts for the benefit of a disabled person. The funds can be saved without jeopardizing the individual’s eligibility for Medicaid, Supplemental Security Income (SSI) and other government benefits. ABLE accounts may be opened by anyone with a disability as long as the disability began before the person turned 26.
Starting in 2018, the amount of money that can be deposited in an ABLE account per year without jeopardizing public benefits will rise from $14,000 to $15,000. The amount that can be deposited in an ABLE account is tied to the federal gift tax exclusion, which has also risen to $15,000.
Other changes to the program in 2018 include the following:
- Traditional 529 plans can now be rolled into ABLE accounts. This helps parents utilize funds that were accumulated in traditional college savings plans before learning their child had a disability.
- Individuals with disabilities who are working may be able to save up to the federal poverty level. Rather than savings being capped at $15,000 per year, in some cases the new law will allow people with disabilities to save their earnings beyond that threshold up to the federal poverty level to potentially accumulate as much as $27,060 per year in savings.
- A note of caution: There are no real “safeguards” built into the legislation to help people monitor contributions that go over $15,000. There have been delays implementing this new part of the law. Legal and financial professionals fear that mistakes are easy to make and benefits could inadvertently be jeopardized.
Setting up an ABLE account is often a solid way to save money toward future expenses for an individual with disabilities. As with most federal or state programs, there are intricacies in the rules that should be understood prior to establishing an account. Seek the assistance of a qualified special needs attorney to ensure that you understand the process before tying up funds.
If you would like to speak to one of our attorneys about the creation of an ABLE Account or use of an ABLE account in conjunction with a special needs trust for your loved one, please contact our Rochester office at (585) 232-5300. Planning sessions can be arranged in any of our offices, Rochester, Canandaigua or Newark, or if you or your loved one is home-bound, we can come to you.