New Jersey Estate Planning and Probate Law Blog

What is included in an end-of-life estate?

On behalf of J. Jeffrey Press, P.A. posted in estate planning on Wednesday, September 11, 2019.

When New Jersey residents pass away, the items that they owned must be properly distributed to their loved ones, creditors and other relevant parties. The things and assets that they leave behind constitute their estate and depending upon the type of estate plan that they leave the distribution of those things and assets can look very different from decedent to decedent.

End-of-life estates can include tangible and intangible items. For example, the personal property that a person owns can be included in the estate. These items of property may include, but are not limited to, vehicles, pieces of art, jewelry and clothing, furniture, collections, books and heirlooms.

The benefits of a credit shelter trust

On behalf of J. Jeffrey Press, P.A. posted in trusts & trust administration on Thursday, August 29, 2019.

A credit shelter trust is a special type of living trust that may be established between two married people. It is set up during the partners' lifetimes and generally benefits their children when they are both gone. At its most basic level, a credit shelter trust takes possession of the partners' assets and when one dies, the assets pass to the beneficiaries who must use it for the benefit of the surviving partner. When the second spouse passes away, their children take possession of the assets.

Credit shelter trusts have a number of benefits. But, different individuals may have different estate planning goals and needs.

Are irrevocable trusts permanently set in stone?

On behalf of J. Jeffrey Press, P.A. posted in trusts & trust administration on Friday, August 16, 2019.

There are many types of trusts, but the main categories are testamentary trusts, which go into effect upon the grantor's death, and living trusts, which go into effect while the grantor is still alive. Among living trusts, there are another two main subcategories: revocable trusts and irrevocable trusts. As its name implies, an irrevocable trust usually cannot be modified after it is executed. However, there are always exceptions to the rule, and irrevocable trusts are no different.

New Jersey residents may be surprised to hear that, in certain limited circumstances, it is possible to modify an irrevocable trust.

Estate planning when you have a chronic illness

On behalf of J. Jeffrey Press, P.A. posted in estate planning on Friday, August 2, 2019.

It is not unusual for a person in New Jersey to have a chronic illness. Some chronic illnesses, such as Parkinson's or Alzheimer's will become progressively worse over time and will eventually make it difficult for a person to communicate their wishes or care for themselves. Therefore, it is very important that those with a chronic illness execute an estate plan while they are still able to do so.

While having a will and/or a trust are an important part of any estate plan, people with chronic illnesses will have some special considerations to make when comes to estate planning. For example, they will want to execute a HIPPA (Health Insurance Portability and Accountability Act) Release. A HIPPA Release gives a named person the ability to access your health records. A physician order for life-sustaining treatment (POLST) can be included in your medical records. It allows your doctors to understand what end of life care you want should an emergency arise.

What situations could cause a person to challenge a will?

On behalf of J. Jeffrey Press, P.A. posted in estate litigation on Thursday, July 18, 2019.

When a person in New Jersey writes a will, they generally believe they are making clear their intentions for how they want their estate dispersed between their heirs after their death. And, for the most part, a properly executed will does just that. However, there could be times when an heir feels the will should not be followed and wants to contest it. This can lead to estate litigation.

It is important to note that challenging a will can be difficult. This is because it is presumed that if the will was executed with all proper formalities, it is valid and should be followed. However, there are circumstances that could provide grounds for challenging a will.

The basics of estate taxes versus inheritance taxes

On behalf of J. Jeffrey Press, P.A. posted in estate and gift tax planning on Wednesday, July 3, 2019.

As the saying goes, the only two guarantees in life are death and taxes. And, for some people, receiving an inheritance after a loved one dies means that either Uncle Sam will take his share before the estate is distributed, or the state may ask the heirs to pay up, depending where they live. Therefore, it is important to understand the basics of inheritance taxes and estate taxes, and when these taxes apply.

An inheritance tax is paid by the person who inherits the estate. For example, if your Aunt Edith passed away and left you $500,000 in her will, you may be personally liable for paying taxes on that $500,000. Only certain states have an inheritance tax. New Jersey is one of those states. The state inheritance tax in New Jersey depends on the size of the inheritance and the relationship between the heir and the decedent. There is no federal inheritance tax.

Avoid making these common estate planning mistakes

On behalf of J. Jeffrey Press, P.A. posted in estate planning on Thursday, June 20, 2019.

Most people in New Jersey execute an estate plan with the intention that it will meet their wishes and benefit their heirs. However, a poorly drafted estate plan or an outdated estate plan can lead to undesirable complications when it comes to enforcing your wishes.

The following are some common mistakes people make when estate planning.

What are some advantages to special needs trusts?

On behalf of J. Jeffrey Press, P.A. posted in trusts & trust administration on Thursday, June 6, 2019.

Parents of special needs children in New Jersey may have concerns about how their child will be cared, especially after the child is an adult and the parents pass away. While parents may want to ensure that their adult special needs child receives the government benefits they need, such as Medicaid and Supplemental Security Income, they may also want to leave some of their assets to their child for the child's care. However, this can be complicated, as most government benefits have low thresholds for the income a disabled adult can have to qualify for benefits. For this reason, some parents choose to execute a special needs trust for the care of their child.

In a special needs trust, the beneficiary can still receive an inheritance, be given gifts and receive other funds without losing their government benefits. This is because these assets will belong to the trust, not the beneficiary and will be managed by a trustee. Even a beneficiary's own assets can be included in a special needs trust, since they will also belong to the trust and be managed by a trustee. There are several types of special needs trusts.

Why is it prudent to review your estate plan from time-to-time?

On behalf of J. Jeffrey Press, P.A. posted in estate planning on Thursday, May 23, 2019.

Some people in Parsippany have executed a comprehensive estate plan, including a will, trust, living will, and power of attorney. However, it is a mistake to simply file that estate plan away allowing it to collect dust as the years pass on. In fact, there are several reasons why a person will want to update their estate plan.

First, state law varies on what is required to execute a will and who will inherit. There may be other specific details determined by state law as well. If a person has moved to a new state since executing their estate plan, they will want to make sure their estate plan complies with their new state's laws so that their wishes for asset distribution can be fully protected.

Why is estate planning important for blended families?

On behalf of J. Jeffrey Press, P.A. posted in estate planning on Thursday, May 9, 2019.

Families in New Jersey come in all shapes and sizes these days, and it is not unusual for a person to marry a second time either due to divorce or the death of their first spouse. Oftentimes there are children from a first marriage, resulting in a blended family with step-parents and step-children. In such situations, it is important to have a well-rounded estate plan that meets your wishes both for your new spouse and your children from your first marriage, especially if those children are now adults.

First, merely having a will may not be enough to meet your estate planning needs if you have a blended family. For example, if you leave everything to your new spouse in your will, once your new spouse passes away there is no guarantee that he or she will leave anything to the children from your first marriage, leaving them with nothing.