Who Can Witness a Will?

Estate Planning, Executor, Probate, Wills / Capacity, Estate Planning Lawyer, Executor, Probate Attorney, Probate Court, St. Petersburg Estate Planning Attorney, Wills

For a will to be binding, there are a number of requirements that must be met, including having a qualified person witness the will. While state laws on wills vary, most require you to be of legal adult age to make a will and have testamentary capacity (i.e., that you be “of sound mind”).

Yahoo Finance’s recent article entitled “Who Can and Cannot Witness a Will?” explains that you usually must have your will witnessed.

Witnesses to your will are significant in the event that someone disputes its validity later or if there is a will contest. If one of your heirs challenges the terms of your will, a witness may be asked by the probate court to attest that they watched you sign the will and that you appeared to be of sound mind when you did so. Witnesses provide you with another layer of validity to a will, and it makes it more difficult for someone to dispute its legality.

When drafting a will, it’s important to understand several requirements, including who can witness a will. Generally, but depending on applicable state law, anyone can witness a will, as long as they meet two requirements: (i) they are of legal adult age; and (ii) they have the mental capacity to sign the will. Therefore, the types of people who could act on your behalf include your friends, a neighbor, co-workers and any of your relatives. Some states also require that witnesses are not receiving anything in the will.

If you’ve hired an experienced estate planning attorney to help you draft your will, he or she can also act as a witness, provided they’re not named as a beneficiary.

Witnesses don’t need to review the entire will document in order to sign it. They only need to be able to verify that the document exists, that you have signed it in their presence and that they have signed it in front of you.

When you sign the will, get both witnesses together at the same time. You’ll need to sign, initial and date the will in ink, then have your witnesses do the same. Some states require you to attach a self-proving affidavit or have the will notarized.

Reference: Yahoo Finance (Dec. 28, 2020) “Who Can and Cannot Witness a Will?”

How do I Settle an Estate if I’m Named Executor?

Estate Planning, Executor, Inheritance, Personal Representative, Trustee, Wills / Estate Planning Lawyer, Executor, Inheritance, Personal Representative, Probate Court, St. Petersburg Estate Planning Attorney, Trustee, Wills

If you are the named executor of an estate, you should learn some of the basics of the job before any work will need to be completed. An executor is the individual named to distribute a decedent’s property that passes under his or her will. The executor also arranges for the payment of debts and expenses.

WMUR’s recent article entitled “Settling an estate” explains that if the named executor is not willing or able to do the job, there’s usually an alternate executor appointed in the will. If there’s no alternate, the court will designate an executor for the estate.

Depending on the estate, it can be a consuming and stressful task to address all of the issues. Sometimes, a decedent will leave a letter of instruction which can make the process easier. This letter may address things like the decedent’s important documents, contact info, a list of creditors, login information for important web sites and final burial wishes.

One of the key documents is a will. The executor must get a hold of a copy and review it. You can work with an estate planning attorney to determine the type of probate (a process that begins with getting a court to approve the validity of the will) is needed.

The named executor should conduct an inventory of the decedent’s assets, some of which may need to be appraised. If the decedent had a safe deposit box, the contents must be secured. Once the inventory of assets has been compiled, assets then may be sold or distributed according to the will.

Asset protection is critical and may mean changing the locks on property. The named executor may be required to pay mortgages, utility bills and maintenance costs on any property. Any brokerage accounts will need to be re-titled. The final expenses also need to be paid.

The funeral home or coroner will provide death certificates that will be needed in the probate process, and for filing life insurance claims.

If the decedent was collecting benefits, such as Social Security, the named executor will need to notify the agency of the decedent’s death so they can stop benefits. Any checks received after death must be returned. The executor will file a final federal and state tax return for the decedent, if necessary. There also may be an estate and gift tax return to be filed.

There’s a lot for a named executor to do. It can be made easier with the help an estate planning attorney.

Reference: WMUR (Dec. 23, 2020) “Settling an estate”

Zappos CEO had No Will and That Is a Mistake

Estate Planning, Executor, Living Will, Power of Attorney, Probate, Wills / Beneficiary Designations, Executor, Living Will, Power of Attorney, Probate, St. Petersburg Estate Planning Attorney, Will

Former Zappos CEO Tony Hsieh, who built the giant online retailer Zappos based on “delivering happiness,” died at age 46 from complications of smoke inhalation from a house fire. He left an estate worth an estimated $840 million and no will, according to the article “Former Zappos CEO Tony Hsieh died without a will, reports say. Here’s why you should plan for your own death” from CNBC.

Without a will or an estate plan, his family will never know exactly how he wanted his estate to be distributed. The family has asked a judge to name Hsieh’s father and brother as special administrators of his estate.

How can someone with so much wealth not have an estate plan? Hsieh probably thought he had plenty of time to “get around to it.” However, we never know when we are going to pass away, and unexpected accidents and illnesses happen all the time.

Why would someone who is not wealthy need to have an estate plan? It is even more important when there are fewer assets to be distributed. When a person dies with no will, the family may be faced with unexpected and overwhelming expenses.

Putting an estate plan in place, including a will, power of attorney and health care proxy, makes it far easier for a family that might otherwise become ensnared in fights about what their loved one might have wanted.

An estate plan is about making things easier for your loved ones, as much as it is about distributing your assets.

What Does a Will Do? A will is the document that explains who you want to receive your assets when you die. It can be extremely specific, detailing what items you wish to leave to an individual, or more general, saying that your surviving spouse should get everything.

If you have no will, state statutes determine who receives your assets, and if you have minor children, the court will decide who will be appointed as the guardian to raise your children.

Some assets pass outside the will, including accounts with beneficiary designations. That can include tax deferred retirement accounts, life insurance policies and property owned jointly. The person named as the beneficiary will receive the assets in the accounts, regardless of what your will says. The law requires your current spouse to receive the assets in your 401(k) account, unless your spouse has signed a document that agrees otherwise.

If there are no beneficiaries listed on these non-will items, or if the beneficiary is deceased and there is no contingent beneficiary, then those assets automatically go into probate. The process can take months or a year or more under state law, depending on how complicated your estate is.

Naming an Executor. Part of making a will includes selecting a person who will carry out your instructions—the executor. This can be a big responsibility, depending upon the size and complexity of the estate. They are in charge of making sure assets go to beneficiaries, paying outstanding debts, paying taxes for you and your estate and even selling your home if necessary. Select someone who is trustworthy, reliable and good with finances.

Your estate plan should also include a power of attorney for someone to handle financial and legal affairs, if you become incapacitated. An advance health-care directive, or living will, is used to explain your wishes, if you are being kept alive by life support. Otherwise, your loved ones will not know if you want to be kept alive or if you would prefer to be allowed to pass away.

Having an estate plan is a kindness to your family. Don’t wait until it’s too late to take care of it.

Reference: CNBC (Dec. 3, 2020) “Former Zappos CEO Tony Hsieh died without a will, reports say. Here’s why you should plan for your own death”

What Does an Executor Do?

Estate Planning, Executor, Probate, Wills / Asset Distribution, Estate, Estate Planning Attorney, Executor, Income Tax, Inheritance, St. Petersburg Estate Planning Attorney, Will

Being asked to serve as the executor of a loved one’s estate is flattering, but it is also a big responsibility and a lot of work. So, what does an executor do? As the executor, you are responsible for taking care of all of the financial and legal matters of the estate, explains the article “An executor’s guide to settling a loved one’s estate” from Review Times. The job will require a lot of time and, depending upon the complexity of the estate and the family situation, could be challenging.

What does an executor do — The job of being an executor has many aspects.

Some of the tasks include:

Filing court papers to start the probate process to determine whether the will is valid.
Making a complete inventory of everything in the estate.
Obtaining an estate tax ID number, opening an estate bank account and using the estate funds to pay bills, including funeral costs and medical bills.
If the estate includes a home, maintaining the home and paying the mortgage, taxes, etc.
Terminating credit cards, notifying banks and government agencies—including Social Security—and the post office.
Preparing and filing income tax returns for the last year of the person’s life, unless they filed them already, and for the estate.
Distributing assets, as directed by the will.

Your first task is to locate the will and any important documents and financial information. You will need the will, deeds, titles, brokerage statements, insurance policies, etc.

If the estate is complicated, you will want to work with an estate planning attorney, who can guide you through the process. The estate pays for the attorney, and you work closely with them. Every state has its own laws and timetables for the executor’s responsibilities, which the attorney will be familiar with.

If possible, find out if there are any family conflicts, before the loved one passes. If there are potential problems, it may be better for the loved one to tell who will be inheriting what before they die. If there is no plan for asset distribution, the person who is asking you to be the executor needs to meet with an estate planning attorney as soon as possible and have a plan created, with all of the documents necessary for your state.

The executor is entitled to be paid a fee, which is paid by the estate. In most states, that fee is set at a percentage of the estate’s value, depending on the size and complexity of the estate. If you are both an executor and a beneficiary, you may want to forgo the fee, because fees are taxable, but in most states, inheritances are not.

Reference: Review Times (Sep. 6, 2020) “An executor’s guide to settling a loved one’s estate”

What Is Involved with Serving as an Executor?

Estate Planning, Executor, Probate, Wills / Estate Planning, Executor, Probate Court, St. Petersburg Estate Planning Attorney, Wills

Serving as an executor of a relative’s estate may seem like an honor, but it can also be a lot of work, says The (Fostoria, OH) Review Times’ recent article entitled “An executor’s guide to settling a loved one’s estate.”

When serving as an executor of a will, you’re tasked with settling the decedent’s affairs after she dies. This may sound rather easy, but you should be aware that the job could be time consuming and difficult, depending on the size of the decedent’s estate and the complexity of the decedent’s financial and family situation. Here are some of the duties that are expected of anyone serving as an executor:

Filing court papers to initiate the probate process
Taking inventory of the decedent’s estate
Using the decedent’s estate funds to pay bills, taxes, and funeral costs
Taking care of canceling her credit cards and informing banks and government offices like Social Security and the post office of her death
Readying and filing her final income tax returns; and
Distributing assets to the beneficiaries named in the decedent’s will.

Each state has specific laws and deadlines for the responsibilities of anyone serving as an executor. To help you, work with an experienced estate planning attorney and take note of these reminders:

Get organized. Make sure that the decedent has an updated will and locate all her important documents and financial information. Having easy access to deeds, brokerage statements and insurance policies will save you a lot of time and effort, making the job of serving as an executor much easier. With a complex estate, you may want to hire an experienced estate planning attorney to help you through the process. The estate will pay that expense.

Avoid conflicts. Investigate to see if there are any conflicts between the beneficiaries of the decedent’s estate. If there are some potential issues, you can make your job as executor much easier if everyone knows in advance who’s getting what, and the decedent’s rationale for making those decisions. Ask the person you’ll be serving as an executor for to tell her beneficiaries what they can expect, even with her personal items because last wills often leave it up to the executor to distribute heirlooms.

Executor fees. You’re entitled to a fee for the work you do serving as an executor. The fee is paid by the estate. In most states, executors are allowed to take a percentage of the estate’s value, which can be from 1-5%, depending on the size of the estate. However, if you’re also a beneficiary, it may make sense for you to forgo the fee because fees are taxable as income, and it could also cause rancor among the other beneficiaries.

Reference: The (Fostoria, OH) Review Times (Aug. 19, 2020) “An executor’s guide to settling a loved one’s estate”

How Can I Avoid Family Fighting in My Estate Planning?

Asset Protection, Estate Planning, Executor, Inheritance / Asset Protection, Estate Planning Lawyer, Executor, Inheritance, Legacy Letter, Letter of Last Instruction, St. Petersburg Estate Planning Attorney

It’s not uncommon for parents to modify their first estate plans, when their children become adults. At that point, many parents’ estate plans are designed to help efficiently transfer assets to the surviving spouse and ultimately to the adult children. However, this process can encounter a number of hiccups and headaches.

Forbes’ recent article entitled “Three Steps To Estate Planning Without The Family Friction” explains that there are a number of reasons for sibling animosity in the inheritance process. Frequently there are issues that stem from a lack of communication between siblings, which causes doubts as to how things are being done. In addition, siblings may not agree if and how property should be sold and maintained. To help avoid these problems, use this three-step process for estate planning.

Work with an experienced estate planning attorney. Hire an estate attorney who has many years of working in this practice area. This will mean that they’ve seen and, more importantly, resolved most types of family conflicts and problems that can arise in the estate planning process. That’s the know-how that you’re really paying for, in addition to his or her legal expertise in wills and trusts.

Create a financial overview. This will help your beneficiaries see what you own. A financial overview can simplify the inheritance process for your executor, and it can help to serve as the foundation for you and your executor to clearly communicate with future beneficiaries to reduce any lingering doubts or questions that they may have, when they’re not in the loop. Your inventory should at least include the following items:

A list of all assets, liabilities and insurance policies you have and their beneficiaries
Contact information for all financial, insurance and legal professionals with whom you partner;
Access information for any websites your beneficiaries may need for your online accounts; and
A legacy letter that discusses non-financial items for your children.

Hold a family meeting. This is the most important one. Conduct a family meeting that includes the parents and the children who will be inheriting assets. Let them hear directly from you exactly what your plans are. Some topics for this meeting include:

The basics of your estate intentions
Verify that a trusted person knows the location of your important estate documents
State who your executor and other involved people will be and your rationale
Make certain that all parties value communication and transparency during this process; and
Discuss non-financial legacy items that are important for you to give to your children.

This three-step process can help keep your children’s relationships intact after you are gone. Hiring an experienced estate planning attorney, creating a clear financial overview and communicating what’s important to you are critical steps in helping to keep your family together.

Reference: Forbes (July 2, 2020) “Three Steps To Estate Planning Without The Family Friction”

What are the Estate Planning Basics?

Estate Planning, Executor, Health Care, Living Will, Power of Attorney, Probate, Trusts, Wills / Asset Protection, Capacity, Estate Planning Lawyer, Executor, Guardianship, Healthcare Directive, Inheritance, Living Will, Power of Attorney, Probate Attorney, Probate Court, St. Petersburg Estate Planning Attorney, Wills

Estate planning is an all-encompassing term that refers to the process of organizing, inventorying and making plans for the proper handling of your affairs during incapacity and after you die. This typically involves writing a will, setting up a power of attorney and healthcare directives with the help of an experienced estate planning attorney.

CNET’s article entitled “Estate planning 101: Your guide to wills, trusts and all your end-of-life documents” provides us with some of the key steps in getting started with estate planning.

Create an Inventory. Your estate includes all of the things you own, such as your car and other valuable possessions, plus “intangible assets” like investments and savings. If you own a company, that’s also part of your estate. Everything you own should be given a valuation. Have your home and other valuables appraised.

Evaluate your family’s needs. A big reason for estate planning is to make certain that your family is cared for, in the case of your death or incapacitation. If you’re a breadwinner for your family, the loss of your income could be devastating financially. Consider a life insurance policy to help provide a financial cushion that can be used to cover living expenses, college tuition cost, and mortgage payments. You may also need to designate a guardian, if you have children under the age of 18.

Make job assignments. Dividing up a person’s property can be a tough and emotional task. Make it easier by ensuring that all of your assets have been assigned a beneficiary. You’ll also name a few people to coordinate the process of dividing up your belongings. List your beneficiaries, so they know who gets what.

Create a Will. You should have a legally binding document setting everything out in as much detail as possible. A will is a legal document that directs the way in which you want your assets and affairs handled after you die. This includes naming an executor, who is someone to manage how your will is executed and take care of the distribution of your assets.

Help your family if you’re incapacitated. A living will (also known as a medical care or health care directive) states your healthcare preferences, in case you’re unable to communicate or make those decisions on your own. If you need life support, a living will states your preferences.

Start estate planning sooner rather than later. Talk to an experienced estate planning attorney today.

Reference: CNET (June 8, 2020) “Estate planning 101: Your guide to wills, trusts and all your end-of-life documents”

How Do the Children Divide Up Mom’s Tangible Property?

Estate Planning, Executor, Inheritance, Personal Representative / Asset Protection, Estate Distribution, Estate Planning Lawyer, Inheritance, St. Petersburg Estate Planning Attorney

What should you do if you’ve been given the task to be in charge of dividing up a parent’s estate that includes assorted tangible items?

Minneapolis Tribune’s article entitled “A clever way to divvy up items after a parent’s death” says that some families do it, by taking turns selecting which items each will keep.

The article discusses how a family decided to divide things up their mom’s grand estate and how the method the family used to divvy up the tangible items could be one that other families with much smaller estates could use.

After their mom’s death at 93, the brother and sister co-executors created an inventory of 724 items in her estate that had monetary or sentimental value. These included things like furniture, artwork, oriental rugs, cutlery, china, a piano and a car. They didn’t include their mom’s jewelry, books or linens, or her silver, gold and collectible coins. The four siblings all agreed to sell the coins and to deal with the many books, linens, and jewelry more informally, after the more significant items had been distributed.

The family didn’t use the common way of disbursing tangible items of an estate, in which family members take turns choosing items. With over 700 items, that could take a while. They felt that system wouldn’t maximize the value received by the four children and seven grandchildren. Instead, their process for dividing the intangible items used the following steps:

The inventory was given to all four siblings and asked each one to state the items that they were interested in. This divided the 724 items into three groups: (a) stuff in which no one had an interest; (b) stuff in which only one person had an interest; and (c) those in which two or more were interested. Things in which no one had an interest, were set aside to be sold or given away, and those who were the only siblings to want certain items got them.
They then made lists of items in which more than one sibling expressed an interest. Each received a list of those items. They were not given information on ones in which they weren’t interested—one of two ways the system wasn’t transparent.
Each person was then “given” 500 virtual poker chips that he or she could use to bid for contested items. However, prior to the bidding deadline, they could talk with one another about their intentions. The result was that many had bid for several similar items, like family pictures, bookcases and oriental rugs — when they really only wanted one from each category. Thus, they agreed among themselves who would receive each one, without wasting too many chips. This also avoided two siblings using a lot of tokens to bid for a particular item, and no one bidding on another similar one.
After the bids were in, the co-executors announced the results, without revealing the bids, to avoid a silent auction where bidders can see what others are bidding and readjust their bids up to the deadline. This was the second part of the system that wasn’t transparent.
Finally, when all the allocations were determined, the co-executors tabulated the monetary value of all the items and readjusted the estate monetary distributions to ensure that everyone came out at the same place financially. The most valuable items were a 1919 Steinway drawing room grand piano valued at $25,000; a 2005 Toyota Camry valued at $4,500; and some oriental rugs with a total value of $13,975. Those who got the big-ticket items had to pay their siblings something for them, with a total of $17,500 trading hands.

It was time-consuming and took several months, but the siblings thought that their system was very fair and the process, unlike what is done in some other family estates, relieved tensions and brought the siblings closer together.

Reference: Minneapolis Tribune (Feb. 25, 2020) “A clever way to divvy up items after a parent’s death”

What Exactly Does an Executor Do?

Estate Planning, Executor, Personal Representative, Probate, Wills / Asset Distribution, Estate Account, Estate Planning Attorney, Executor, Heirs, Last Will and Testament, Probate, St. Petersburg Estate Planning Attorney

The job of the executor is an important one. The executor has a responsibility to manage the assets and debts of the decedent and carry out instructions documented in the last will and testament. The executor is also responsible for distributing assets, explains the article “A Step-by-Step Guide to Being an Executor” from Kiplinger. If there are any claims against the estate, the executor might be facing personal responsibility, if funds are not handled properly.

The learning curve could be steep, especially if the executor does not know a lot about the person’s finances and possessions, or is new to the tasks of managing money, locating heirs or navigating the legal processes that occur after someone dies. If the decedent didn’t tell the executor where their records and important papers are kept, things can get even more challenging.

Here’s what an executor needs to know, preferably before their services are needed:

Get informed and up to speed. Read the will and see if the decedent’s intentions are clear. That’s not always the case. When one man became executor of his mother’s will, he and his sister had two different interpretations about what their mother wanted to happen to the family home. While they wrangled over the issue, there were property taxes to be paid and maintenance costs. A letter of direction explaining things clearly would have prevented many problems.

Sit down and talk about it. It is a kindness to heirs to share information and intentions, while you are still alive. Discuss the will with the immediate family to avoid any surprises or misunderstandings. Consider having a conference with children to ensure that they understand the estate, the will and what to expect. If you have an argumentative family, doing this in advance won’t guarantee smooth sailing, but it may lessen the fighting.

Make an inventory. Managing an estate can be a long process, with many curves along the way. You’ll make it easier, if you create a list of all assets, accounts, debts and liabilities. Make a note of where tax records and insurance policies can be found. Include a list of all online accounts and digital assets, plus the names of your professional advisors, including the estate planning lawyer and CPA. Ideally, review the list with your executor.

Get copies of the death certificate. Request multiple copies. Some institutions will require originals with a raised seal, while others will work with a copy or a scanned document. Better to have a few more than you need, so you don’t have to keep buying new ones.

Speak with an estate planning attorney. There are legal forms and tax forms that will need to be prepared. In some states, probate is straightforward. In other states, it is a complex and time consuming process. You don’t need to go it alone.

Open an estate account. The estate is a legal entity and requires a separate tax ID. The executor needs to apply for a separate tax ID, and then can use that to open a bank account. The estate funds the bank account, which is used to pay bills and deposit proceeds from assets.

Distribute assets. The executor is responsible for keeping heirs updated. Heirs receive assets, as designated in the will. If there are collections or a home, they will need to be professionally assessed, before they can be sold.

Reference: Kiplinger (May 12, 2020) “A Step-by-Step Guide to Being an Executor”

Requests for Estate Plans Reflect Fears about Coronavirus

Estate Planning, Executor, Guardian, Health Care, Living Will, Power of Attorney, Wills / Coronavirus, COVID-19, Do Not Resuscitate, Estate Planning Attorney, Health Care Proxy, Incapacitated, Living Will, Nursing Home, Power of Attorney, St. Petersburg Estate Planning Attorney, Surrogate, Wills, Witnesses

Estate planning lawyers have always known that estate planning is not about “if,” but about “when.” The current health pandemic has given many people a wake-up call. They realize there’s no time to procrastinate, reports the article “Surge on wills: Fearing death by coronavirus, people ask lawyers to write their last wishes” from InsuranceNews.net. Legal professionals urge everyone, not just the elderly or the wealthy, to put their end-of-life plans in writing.

The last time estate planning attorneys saw this type of surge was in 2012, when wealthy people were worried that Congress was about to lower the threshold of the estate tax. Today, everyone is worried.

Top priorities are creating a living will stating your wishes if you become incapacitated, designating a surrogate or a proxy to make medical decisions on your behalf and granting power of attorney to someone who can make legal and financial decisions.

An estate plan, including a last will and testament (and often trusts) that detail what you want to happen to assets and who will be guardian to minor children upon your death, spares your family legal costs, family disagreements and hours in court that can result when there is no estate plan.

The coronavirus has created a new problem for families. In the past, a health care surrogate would be in the hospital with you, talking to healthcare providers and making decisions on your behalf. However, now there are no visitors allowed in hospitals and patients are completely isolated. Estate planning attorneys are recommending that specific language be added to any end of life documents that authorize a surrogate to give instructions by phone, email or during an online conference.

Any prior documents that may have prohibited intubation need to be revised, since intubation is part of treatment for COVID-19 and not necessarily just an end-of-life stage.

Attorneys are finding ways to ensure that documents are properly witnessed and signed. In some states, remote signings are being permitted, while other states, Florida in particular, still require two in-person witnesses, when a will or other estate planning documents are being signed.

There are many stories of people who have put off having their wills prepared, figuring out succession plans that usually take years to plan and people coming to terms with what they want to happen to their assets.

Equally concerning are seniors in nursing homes who have not reviewed their wills in many years and are not able to make changes now. Older adults and relatives are struggling with awkward and urgent circumstances, when they are confined to nursing homes or senior communities with no visitors.

Reference: InsuranceNews.net (April 3, 2020) “Surge on wills: Fearing death by coronavirus, people ask lawyers to write their last wishes”