Many people who create Trusts do not have a family member who is an appropriate person to appoint to serve as a Trustee. The person who serves as a Trustee should be financially responsible and someone who will not be tempted to administer the Trust for his or her own benefit instead of the benefit of the Trust beneficiaries. Ideally, the person should also be someone who the beneficiaries respect enough to defer to in decision-making without unnecessary challenges.

Many people do have responsible and respected family members who can act as Trustees, but those who don’t have to look for other options. Some people choose to use professionals. Banks and Trust Companies will act as Trustees for a fee. They can both be excellent options. Another option is to hire an attorney to act as a Trustee. Because of the professional ethics demanded of attorneys, they will act for the benefit of the Trust. Yet another option is to appoint the best family member that you can and hire an attorney to act as an advisor to the family member Trustee when the need arises for professional advice.

Talk to your estate planning attorney about who you should appoint to serve as a Trustee for the Trusts that you create and whether you would benefit from a professional as a Trustee.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

As part of your estate plan, your  New York City estate planning attorney will draw up a wide range of documents for you. As part of the process, you will need to designate people to act on your behalf. You might need to appoint an executor, a trustee, a general power of attorney, a healthcare prox and more. You do not need to designate the same person to act in every role.

Speak with your attorney about what the people designated for each role actually do so that you can designate the most appropriate person. For example, the executor of your will has a short-term assignment. Once directives in the will are carried out, the executor’s role is over. However, a trustee may need continue administering the trust for years. Thus, you might want to consider a potential trustee’s ability to continue to act well into the future, which might not be as big of a concern for an executor.

Different considerations go into deciding who to appoint to different roles, such as appointing a power of attorney or a  healthcare proxy. An estate planning attorney will go over every role with you and has the experience to know what the most important factors are that you should consider. Make sure you ask your attorney about every role.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

To fund your living trust, you need to transfer assets into your trust. You can transfer money and property into your trust by placing title to your bank account and title to your real property into the trust. You must specifically identify the property and accounts within your trust.

In addition to properly funding your living trust, you need to appoint an individual or trust company to oversee and administer your living trust. The New York Estates, Powers and Trusts Law governs the administrative duties of trustees. Specifically, Article 7 of the New York Estates, Powers and Trusts Law sets forth the specific rules governing trusts. Part 2 of Article 7 establishes the specific duties and rules governing trustees.

Although there may be public confusion whether living trusts are contestable, they are. An attorney can minimize the opportunities for trust contests, but it is impossible and illegal to place a blanket provision in your trust prohibiting future contests. You should avoid sales pitches by trust companies attempting to sell you their trust services if they falsely promise to make them “fool-proof.” If you purchased a service from these companies, make sure you talk to your attorney about the living trust document they sold you before returning them.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

There are many different reasons you may want to create a living trust, and your attorney may decide to supplement your will with a living trust. However, in most cases, a living trust does not replace the need for a will. Your attorney may decide that creating a living trust is essential to your overall estate planning needs.

A living trust does not have to go through probate, and your living trust is not a part of public record, as your will is. A living trust may be a good idea to help you address setting aside enough money for a child or incapacitated adult who is unable to take care of her own finances. You can give your trustee specific instructions for distributing money to a guardian to address those special concerns.

Your attorney may decide that a living trust is unnecessary to meet your estate planning goals because other instruments, such as payable on death accounts, may address them. After discussing your needs with your estate planning attorney, your attorney can discuss the benefits with you. You can contact our office today to discuss whether a living trust is appropriate for your individual estate planning needs. If you contact our office we can help you determine the costs and benefits of creating a living trust as part of your estate planning documents.

Check in with us tomorrow to read Part 3 of An Insider’s Guide to Living Trusts in New York.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

A living trust allows the person creating the trust to set aside money or property within the trust for the benefit of others by appointing a trustee to administer the trust and ensure the trust property is distributed to the beneficiaries. If you are the person creating a living trust, you are known as the grantor, owner or settlor of the living trust. A living trust is also known as a revocable inter vivos trust.

A testamentary trust, on the other hand, becomes operative after your death, pursuant to your will. Testamentary trusts typically go through probate. A living trust earns its name from the fact that you as the grantor of the trust created it while you were alive and it becomes effective before your death. After your death, your living trust may continue to operate as long as you comply with the New York Estates, Trusts and Powers Law when creating one.

Your attorney may also decide to create a “pour-over” will that allows any other property to pour-over into your trust after your death. However, the property that may pour-over from your will into your living trust will still have to go through probate. It typically becomes public record as soon as your personal representative or trustee submits it for probate. In this case, your living trust and your will become part of the New York Surrogate Court’s public records accessible by public request.

Check in with us tomorrow to read Part 2 of An Insider’s Guide to Living Trusts in New York.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

You should own your property in accordance with your needs, goals, and up-to-date estate plan, designed by a qualified estate planning attorney.  Proper asset ownership is a key to a successful estate plan; and, most people don’t own their assets properly.  If you have a revocable living trust, fund your assets into the trust.

If you do trust-based planning, your estate planning attorney will tell you to fund all of your assets into the name of your trust.  This is the only way your trust will work and won’t be just a pretty pile of papers in your desk drawer.

How to Fund Your Trust

For example, you change the name on your bank accounts and investment accounts, to the name of your trust.

You transfer the title of your house to the name of the trust, and change the beneficiary of your life insurance policies, annuities, and retirement plans to the name of your trust.

Assets Your Trust WON’T Control

Your trust can only control assets in its own name; therefore, your trust does NOT control:

• Assets in your individual name
• Assets you own jointly with someone else
• Tenancy by the entireties assets
• Assets with a beneficiary designation, unless the title and beneficiary have been changed to the trust
• Assets with a “pay on death” or “transfer on death” designation
• Assets with a “in trust for” designation
• Assets in your spouse or children’s names

If you’ve done estate planning, specifically trust planning, make sure that your plan actually works by making sure you own your assets properly.   For guidance on your individual situation, consult with a qualified estate planning attorney.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

Some estate planning documents are effective as soon as you sign them; others not until you’re incapacitated or die.  You and your trusted helpers (i.e. executor, power of attorney agents, guardians for minor children, and trustees) need to understand when your estate planning documents are effective.  After all, your trusted helpers only have the legal authority to act on your behalf when the documents are in effect.

• Your Will

Your will is only effective if you’re dead; it has no authority and doesn’t get filed anywhere until then.  Your executor files your will with the probate court and is then granted authority to act.  It is then that the guardians for your minor children have the authority to make legal, medical, general welfare, and lifestyle decisions for your children.

• Your Revocable Living Trust

Your revocable living trust is effective as soon as you sign it; however, your successor trustees don’t have authority to act on your behalf until the trust document says that they do.  For example, trusts typically have provisions for disability (i.e. incapacity.)  When that definition is met, your disability trustees have the authority to act on your behalf and manage trust assets.

The trust is not filed with the court and there is no need for the court to grant authority to the successor trustees (unless your trust provides for such.)  Death (i.e. settlement) trustees have the authority to act upon your death.

You may name a spouse or an adult child as an initial trustee, along with, or instead of, yourself.  Any person named as an initial trustee has authority to act as soon as the trust is signed.

• Your Health Care Proxy

A health care proxy is effective if you cannot give informed consent to accept or refuse medical treatment.

• Your Power of Attorney

A power of attorney is sometimes effective immediately; other times, it’s effective only when you are incapacitated.

• Your Living Will

Your living will is effective if your doctors examine you and determine that you are in an irreversible coma or persistent vegetative state.

If you need additional assistance understanding when your estate planning documents are effective or think your documents are different than described above, consult with a qualified estate planning attorney.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

We’ve found that our clients benefit from reviewing our “9 Important Trust Planning Terms” so we’re sharing it with you as well.  If you have any trust planning questions or concerns, be sure to consult with a qualified trust planning – estate planning attorney.

Trust

A trust is a legal agreement, technically, a contract.  The trust is like an instruction book that gives guidance to the trustee as to how to carry out his duties.

Irrevocable Trust

A trust that, in general, cannot be changed (without court order or trust protector intervention.)  Examples of irrevocable trusts would include insurance trusts, children’s trusts, spousal trusts, qualified residence trusts, and charitable trusts.  A revocable trust becomes irrevocable upon the disability or death of the trust maker.

Revocable Trust

A trust that can be changed anytime while the trust maker is alive and well.  The trust maker retains full control over assets and trust provisions because he serves as trustee.  A revocable trust becomes irrevocable if the trust maker becomes incapacitated or dies.

Trustee

The individual or corporate fiduciary (i.e. bank or trust company) that holds legal title to trust assets and carries out the instructions in the trust.

Testamentary Trust

A trust created under a will typically for a surviving spouse and children.

Trustee Powers

The trust provisions (i.e. instructions) that define what the trustee must, may, and cannot do.

Totten Trust

A “totten trust” is a pay-on-death (POD) or transfer-on-death (TOD) bank account.

Trust Corpus

The assets held in the name of the trust are called “trust corpus” or “trust res.”

Trust Merger

When the beneficiary and the trustee are the same individual, it is called a “trust merger.”  It’s as if no trust exists.  This is why it’s imperative that your beneficiary serves with a co-trustee to retain asset protection.

If you’re interested in trust planning or have estate planning questions, be sure to consult a trust planning – estate planning attorney.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

JOIN US FOR A FREE WORKSHOP THIS WEEKEND TO LEARN THE FOLLOWING:

Elder Law and Medicaid Planning

Medicaid needs arise when you least expect them. Americans are living longer than before. At the turn of the 20th century, life expectancy was about 47 years. In the 21st Century, life expectancy has doubled. As a result, we face more challenges and transitions in our lives than those who came before us.

PROTECT your life savings.
INCREASE the amount of income of keep.�
AVOID losing your home.
REDUCE or ELIMINATE your nursing home bills and long term care costs.
LEARN about Veteran’s Benefits.

Wills, Trust and Estate Planning

We know you want to pass your wealth to whom you want, when you want, the way you want, at the time of your death. If done correctly, a Estate Plan can help minimize estate taxes for a married couple and allow a trusted person to take over your care and finances during incapacity.

PROTECT your family.
AVOID probate delays and expenses.
SAVE estate taxes. Give your money to your family.
PRESERVE money for children or charitable causes.

Join us at our FREE Workshop this weekend. Our experienced attorneys will give you the information you need.

To register for the seminar, call our office at (718) 793-7000 , or click on this link

 http://www.davidovlaw.com/local/estate-planning-seminars.aspx

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.