new york trust lawyer

Back to Basics: Your First Estate Planning Meeting

Published on: September 28, 2016 | by Ettinger Law Firm

The first time you meet with your estate planning attorney can be stressful and emotional. Many people go into the meeting not knowing what to expect. In order to make your first meeting as painless and hassle free as possible, here are a few things to consider ahead of time

Think About Your Wishes Beforehand

Come to the meeting prepared. During this meeting, you will be making decisions that will affect your future and your family for generations to come. Estate planning decisions should not be made lightly. The size of your estate and the unique makeup of your family can determine aspects of your plan. Consider your specific needs.

JOINT SPOUSAL TRUST

Published on: April 15, 2016 | by Ettinger Law Firm

NOT AS USEFUL BUT STILL GOOD TO HAVE

This blog has explored the issues revolving around an ABC trust in the past and how its previously primary reason for existence is now no longer a consideration for many people. The primary reason for their existence was to ultimately lowering the overall tax liability of the parties by sheltering one spouse’s assets and estate tax liability from the others. With the higher estate tax exemption and exemption portability allowed between spouses, its utility is diminished. For those in New York, however, there is some need to maintain it for New York estate tax purposes. There are other benefits to having such a trust. ABC trusts are known by many names, including a credit shelter trust or a joint spousal trust.

There is little if any difference between the names. Another benefit to such trusts is the step up basis that is accomplished upon the passing of the owner. Whenever title to that asset eventually does pass, the new owner will have a higher basis, so that when they in turn pass title, they will have a lower capital gains tax bill. Indeed under federal estate tax law, the stepped up basis will likely be not be an issue for estate tax liability, given the large federal estate tax exemption and availability of the portable exemption between spouses. New York’s estate tax, however, makes it more likely that a joint spousal trust should be employed, so that the deceased spouse’s original basis can be noted and the surviving spouse can account for any increase in basis for their estate when they pass away, since the surviving spouse gets full stepped up basis of the asset. This can help to possibly reduce the overall tax bill.

THE CLAT – STRANGE NAME, GREAT PLAN

Published on: March 28, 2016 | by Ettinger Law Firm

CHARITABLE LEAD ANNUITY TRUST

There are many great estate planning strategies that allow a person to avoid or lower estate tax liability and give money to charity at the same time. With the large estate tax exemption and portability of estate tax exemptions only a small number of Americans will face the possibility of paying the federal estate tax. For many New Yorkers, however, the federal estate tax is a secondary consideration in light of the lack of right to transfer any unused estate tax exemption from for the first deceased spouse to the next. Instead of a double benefit, New Yorkers face a potential double hit of not only having a lower estate tax threshold, but being taxed on the entire estate amount, sans estate tax exemption. For couples that face this possibility and for those with larger estates, few match the simplicity of the charitable lead annuity trust, often abbreviated as a CLAT. It is also a good fit for those who seek to defer the payout of their trust payments to relatives quite some distance in the future.

The CLAT works quite simply by funding the trust with a certain amount, usually a large amount (since it is generally used by families or grantors looking to reduce their estate tax liability) that is scheduled to be paid out to a charity over of a certain length of time. Once the payout period for the charity is over, a certain sum, plus any additional monies earned (minus taxes and expenses of course) is paid to the remainderman beneficiary of the trust.

VETERANS ADMINISTRATION PENSIONS – AID AND ATTENDANCE PENSION

Published on: January 29, 2016 | by Ettinger Law Firm

The Veterans Administration has a program that allows for a large subset of the veterans population to qualify for certain benefits that pay for costs associated with caring for a veteran or their spouse. This Aid and Attendance pension may be in addition to any pension that the service member and/or their spouse may already receive. The Housebound pension also covers certain costs associated the care and attendance to the veteran or their spouse when they are primarily confined to their residence. While a veteran or their spouse may already receive a pension, as well as these additional benefits, one cannot receive both the Aid and Attendance benefits as well as the Housebound benefits. It is important to note at the outset the difference between a pension and compensation.

Compensation is a sum of money that the veteran receives, tax free, for disabilities that the veteran suffered in relation to their time as a service member. The compensation is meant to make up for any loss of income due to the disability. A Pension is meant to provide additional monies to low income or disabled veterans who served during a period of war, or in a war zone. Both of these benefits are distinct from a military retirement. The benefits under these Veterans Administration programs have been in existence for over 60 years, yet many Veterans Administration officials and Veterans Administration attorneys were unaware of these benefits until recently.

WHAT IS COVERED

HOW REVOCABLE IS MY IRREVOCABLE TRUST

Published on: December 27, 2015 | by Ettinger Law Firm

IRREVOCABLE TRUSTS COSTS AND BENEFITS

Trusts are valuable estate planning devices that allow for the transmission of wealth with lower tax liability. When proper estate management is picked, they also allow for the creation of future income, potentially allowing for the life of the trust in perpetuity. Trusts also allow for the beneficiaries to benefit from the income of the corpus of the trust, yet insure that their creditors cannot obtain the income producing assets itself. The same also applies for a financially irresponsible beneficiary, in that it provides income but prevents the financially irresponsible beneficiary from squandering the income producing asset. One of the most popular types of trusts is the irrevocable trust. As with anything in life, there are upsides and downsides; one of the downsides to an irrevocable trust is that in most circumstances, and, more particularly, most states, an irrevocable trust is usually irrevocable. Unwinding an irrevocable trust when it no longer functions as it should, due to, for example, a major change in the estate and gift tax law is possible but must be done correctly, whereby the assets from the trust may be transferred or gifted to the beneficiaries or the settlor if still alive.

WHY TO MODIFY OR REVOKE?