Planning your Will

Planning your Will

Your Last Will and Testament  is the heart of your estate plan and governs distribution of your assets when you pass away. Thinking about death may be daunting, but making a will and comprehensive estate plan while you’re healthy can make settling your estate much easier and cheaper for your loved ones when you’re no longer around. A well-drafted will and estate plan can save tax and bring peace of mind knowing that your wishes should be carried out.

Since you won’t be around to explain your will or the rest of your estate plan, it is important to get it right in the first place. Therefore, before we complete an estate plan or draft a will, we will ask you about your circumstances, finances, and goals and present options to meet your aims and limit taxes if appropriate.

Distributing your property and other assets as you wish

Your will’s primary purpose is to make sure your property goes to your intended beneficiaries. That may not be as simple as it sounds. Primary beneficiaries may not survive you and your assets and wishes may change over time. Thus, a will is a living document and must be coordinated with other estate planning documents like beneficiary designations for employer plans and life insurance policies.

To ensure that your estate plan can withstand challenge, it is important to have a rational explanation for unusual provisions. For instance, you may want to name as beneficiaries persons who aren’t family members, favor one child over another, or exclude an estranged child or sibling.

Any property you don’t cover through a will or other beneficiary designation passes by intestacy to your heirs in a certain order regardless of your wishes. If you want to control distribution of your property when you die, you need a will.

Avoid family conflicts

When a family member dies, emotions tend to run high. Longstanding issues can come to the fore, buried hatchets get dug up, and petty disputes over assets, money and Executor designation can create lasting rifts that tear families apart. While we will prepare your will to reflect items that you consider important, we can draw on our experience in delicate situations to help design your will to avoid family conflicts.

Minimize taxes

Your estate may be subject to state and federal estate tax and/or New Jersey inheritance tax.  We can help you understand your estate’s potential tax liability and present options to limit tax.

Main page:  Estate and Inheritance Tax

Guardian for children

If you have children under age 18, or serve as guardian for a loved one who has been adjudged incapacitated, then you may want to designate a successor guardian in your will. A testamentary (named by will) guardian has similar powers to a parent.

The testamentary guardian still must be appointed by a court, but the process is much simpler than if no guardian were named in the will. The court probably will respect your wishes and appoint the person you name so long as he/she appears to be a responsible choice.

Safeguarding children from a prior marriage against disinheritance

Your children won’t be guarantied an inheritance unless you provide for them in your estate plan. Your spouse may not choose to provide for your children after you are gone especially if you both have children from other partners. While it certainly can be reasonable to leave everything to your spouse and hope the spouse will provides for your children, the spouse will be free to disinherit them.

We can present other options to strike a balance between providing for your spouse and protecting your children against disinheritance. These may involve contract to make a will, life insurance, distributions to your children when you die, and/or a trust.

A good compromise may be a QTIP trust that provides a lifetime income to your spouse but preserves principal for your children. A QTIP trust is administered by a trustee who automatically pays trust income to your spouse. You also can authorize the trustee to distribute principal to your spouse if needed. When your spouse dies, remaining QTIP trust principal is distributed to your children.

A contract to make a will can provide some protection against disinheritance, but it isn’t nearly as fool proof as a QTIP trust. Still many couples prefer a contract to make a will to avoid the complexity and cost of a QTIP trust.

Special needs planning

Distributions to a child or other loved one with disabilities or a trust for his/her support risk disqualifying your child for important public benefits like Medicaid and SSI. However, by including a special needs trust in your estate plan, you can provide for a person with disabilities without jeopardizing public assistance.

Main page:  Estate planning for a child with special needs

Coordinating non-probate assets

Assets that pass outside your will are called non-probate assets. These include life insurance or retirement accounts with a named beneficiary and assets held jointly (such as a joint bank account or house) where each owner has a right of survivorship. When planning your will, your probate assets (which pass under your will) should be coordinated with your non-probate estate. It may involve designating beneficiaries, tax planning and other steps that we can walk you through. At your request, we can help you fill out employee plan forms to coordinate with your will and lessen the impact of taxes.

Do I need a lawyer to make a Will?

It’s possible to create a will without a lawyer. Online services happily sell you forms that don’t cost much money, but they can’t give you legal advice. Doing your own will can save some money up front but may cost thousands down the road. For instance, unless you have tax expertise, how can you tell if your will contains even the most basic provisions needed to minimize taxes, not to mention more complex tax planning? Does the do it yourself will take into account children from prior marriage? What about drawing beneficiary forms to limit tax liabilities? And, that’s just the tip of the iceberg. In other words, there is much more to estate planning than a legal document.

When you hire an attorney, you’re working with a legal expert who will analyze your circumstances and create a custom plan tailored to your goals. When you buy a form, you’re getting a generic document that may not accomplish your goals or even meet your needs. A fill in the blank form probably won’t limit taxes, protect disabled children or children from prior marriages, and address other important concerns.

A Will is a complex legal document that your family will rely upon during a very difficult time. For something that important, it’s worth working with knowledgeable counsel.

As this website provides general information and isn’t tailored to your particular situation, it doesn’t constitute legal advice and may not take into account rules and exceptions that affect you. Although updated from time to time, this website may not take account of recent legal developments or differences in laws from state to state. For safety sake, obtain individual legal advice before you act! You assume all risk of acting on information contained in this website. This website doesn’t constitute legal advice, and no attorney-client relationship exists unless FriedmanLaw and you execute a written engagement agreement. Please contact us at 908-704-1900 to discuss engaging FriedmanLaw to help resolve your legal concerns.
Homepage photo: Cows grazing at Meadowbrook Farm, Bernardsville, NJ by Siddharth Mallya. October 23, 2012.
Interior photo: Somerset hills pastoral scene by Lawrence Friedman.