February 2012 Archives

Under New York law, your surviving spouse automatically has a right to a portion of your estate regardless of what your will may say. This is known as the right of election.

Generally, the share of your surviving spouse in New York is one-third of your estate if you have a child, or one-half, if you have no surviving children. Your surviving spouse gets the minimum even if you say otherwise. However, the New York right of election is not set in stone. Couples can agree to eliminate right of election through a prenuptial agreement.

A living trust — an inter vivos trust if you want to be formal — allows you to put your assets in a trust while you’re still alive, report the researchers at FindLaw’s New York Estate Planning News.

If your living trust is revocable, as almost all are, this estate planning tool gives you great flexibility.

Here’s how it works:

Nothing is certain but death and taxes … and tax deductions.

Most people are starting to become aware that death does not mean the end of taxes, particularly given the fact that issues of the estate tax still need to get sorted out.

So, if you want to have at least a material piece of you live on in this world after death, one way of doing it is through making sure that your estate will claim certain deductions.

The two most important deductions for estate tax purposes are the marital deduction and the charitable deduction.

With the passing of Whitney Houston, many aspects of her estate, both her property and her earnings, are coming up for public discussion.

In terms of property, Whitney Houston's estate includes a New Jersey mansion listed for $1.75 million, reports X17.

And in terms of her other assets, particularly those that come from royalties, there is discussion that her estate will see a lift as a result of what is sometimes called a post-mortem boost, reports Entertainment Weekly. Downloads of her music were up considerably, and she was set to star in a film called Sparkle, which may yet bring more revenue to her estate.

As Americans become increasingly attached to their pets, there are now books getting published on how even after your death, you may continue taking care of your beloved animals. One of these books is called Fat Cats & Lucky Dogs.

So how does one leave money to an animal when an animal does not have the legal capacity to own property? What many people do, reports FindLaw, is they leave the pet with someone who they know will provide it with good care. You can also leave that person any property or money to help out with the care of the pet.

In the past, it was only the wealthy that could take advantage of the tax breaks and other benefits of supporting a charity derived from charitable trusts. One reason for this was because it would often take over $100,000 to hire an attorney and start such a trust.

By pooling money among a group of people, however, you can set up your own charitable trust for very little - often with starting costs between $5,000 and $10,000. And the researchers at FindLaw have all the tips you need to know to pull off a pooled charitable trusts.

When you feel that you’re ready to make a substantial gift to a charity, you may want to consider a charitable trust, which is a special type of trust.

A charitable remainder trust is the most common type of charitable trust, report the researchers at FindLaw. To set up a charitable remainder trust, you must first set up a trust and transfer to that trust all the property that you want to donate to charity. The charity that you choose must be approved by the Internal Revenue Service, which generally means that the charity must be exempt from taxes.

Grown children of senior citizens often hire a caregiver for their parents. But from an estate planning perspective this has the ability of going awry. It has been known to happen that the caregiver develops a relationship with the elderly parent and secretly marries him or her, according to FindLaw's KnowledgeBase. Such marriages allow the former caregivers access to your inheritance and must be watched out for.

Where the fraudulent caregiver is still married when the patient dies, there is very little that the children can do to stop the caregiver from inheriting.

However, New York estate planning law as developed by the courts can provide a way out for families to overcome a fraudulent caregiver's shenanigans.

All those Mayan predictions about the end of the world in 2012, were, it turns out, warnings about the massive cataclysms that would affect the estate tax arena in 2012.

How do we know? Because after 2012 estate tax will not be the same, reports Fidelity. Consider the following:

For 2012, the current law provides a generous $5,120,000 per person federal estate tax exemption and taxes estates over that amount at a top rate of 35%. This compares with a $1 million per person federal estate tax exemption and a 55% effective top tax rate scheduled to go into effect on January 1, 2013.

An unexpected problem seems to have reared its head among the elder population.

It turns out that nursing home beds for men are really hard to find, reports The New York Times.

The reason, of course, is not difficult to infer. As The Times states: “Nursing homes are heavily female, like the elderly population itself.”

That second part of the sentence is crucial. It suggests that women are living longer than men and so have a greater population in nursing homes.

The federal estate tax is imposed on estates exceeding $5 million. And once you’ve got estates of that size, many people become inclined to find ways to reduce their estate tax.

The researchers at FindLaw, while no replacement for a qualified New York estate planning attorney, have put together a list of some general ideas on strategies for reducing estate tax. Five of these estate tax reduction strategies are: