Inheritance

Am I Named in a Will? How Would I Know?

Imagine a scenario where three brothers’ biological father passed away a decade ago. The father wasn’t married to their mother, and, he had another family with three children, grandchildren, and great grandchildren. The father never publicly acknowledged that the three boys were his children. They’ve now heard rumors that he left them something in his will—which may or may not exist. The father’s wife has also passed away.

Nj.com’s recent article entitled “How can we find out if our father left us something in his will?” explains that a parent isn’t required to leave his or her adult children an inheritance.

If a person doesn’t leave a will when they die, the intestacy laws of the state in which he or she dies will dictate how the decedent’s property is divided.

For example, if you die without a will in Kansas, your assets will go to your closest relatives. If there were children but no spouse, the children inherit everything. If there is a spouse and children, the spouse inherits one-half of your intestate property, and your children inherit the other one-half of your property.

In Illinois, if you’re married and you pass away without a will, the portion given to your spouse is based upon whether you have living descendants, such as children and grandchildren.

In New Jersey, if the decedent is survived by a spouse and children—this includes any children who are not children of the surviving spouse—the surviving spouse gets the first 25% of the intestate estate, but not less than $50,000 nor more than $200,000, plus one-half of the balance of the intestate estate. In that state, the descendants of the decedent would receive the remainder.

Note that an intestate estate doesn’t include property that’s in the joint name of the decedent and another person with rights of survivorship or payable upon death to another beneficiary. In our problem above, the issue would be whether the three boys would’ve been entitled to a percentage of the property permitted under the state intestacy statute, or under a will if you could prove there was one.

However, the time for the three boys to make a claim against their father’s estate would have been at his death. A 10-year delay is a problem. It may prevent a recovery because there are time limitations for bringing legal actions. However, they may have other claims, and there may be reasons you are not too late.

Litigation is very fact-specific, and the rules are state-specific. The boys should talk to an estate litigation attorney, if they think there are enough assets to make at it worth their while.

Reference: nj.com (Dec. 29, 2020) “How can we find out if our father left us something in his will?”

Do I Assume My Parents’ Timeshare when They Die?

Ridding yourself of a timeshare can be difficult. Frequently, heirs of a timeshare owner don’t want to take on the liability and the responsibility.

Nj.com’s recent article entitled “Can I leave a timeshare to the timeshare company in my will?” explains that as a general rule, unless it’s in an attempt to defraud creditors, a beneficiary may always renounce or disclaim a bequest made to him or her in a will.

However, if you write a provision in your will, it doesn’t mean that it’s legal, needs to be followed, or can be carried out.

As an example, a beneficiary designation on a bank account or certificate of deposit (CD) to your brother Dirk would take precedence over a specific bequest in your will that the same account or CD goes to your brother Chris. In that instant, the bank will pay the bank account or CD to your brother Dirk—no matter what your will says.

Likewise, with shares in a closely held business. If there is a contract between the shareholders dictating what happens to shares of the business if someone dies, that agreement will also override a provision in your will.

A timeshare is a contract. That means the terms of that contract control what happens. Your will doesn’t.

If the will doesn’t contradict the contract, like bequeathing the timeshare to a third-party who will continue to pay the contract obligations, both documents can co-exist.

A timeshare owner can’t avoid contractual obligations by just giving back the unit back to the corporation, unless that’s permitted in the contract.

The timeshare corporation isn’t required to take back a timeshare unit whether it is returned by the terms of the will or by the executor in administrating the estate, unless the signed timeshare agreement provides for this, or terms of the return are negotiated.

Reference: nj.com (Dec. 24, 2020) “Can I leave a timeshare to the timeshare company in my will?”

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

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.

named executor
Working with an experienced probate attorney makes the job of a named executor much easier

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”

How Much Should We Tell the Children About Our Estate Plan?

Congratulations, if you have finished your estate plan. You and your estate planning attorney created a plan that is suited for your family, you have checked on beneficiary designations, signed all of the necessary documents and named an executor to carry out your directions when you pass away. However, have you talked about your estate plan with your adult children? That is the issue explored in the recent article entitled “What to tell your adult kids when planning your estate” from CNBC. It can be a tricky one.

There are certain parts of estate plans that should be shared with adult children, even if money is not among them. Family conflict is common, whether the estate is worth $50,000 or $50 million. So, even if your estate plan is perfect, it might hold a number of surprises for your children, if you don’t speak with them about your plan while you are living.

Even the best estate plan can bequeath resentment and family conflicts, if family members don’t have a head’s up about what you’ve planned and why.

If you die without a will, there can be even more problems for the family. With no will—called dying “intestate”—it is up to the courts in your state to decide who inherits what. This is a public process, so your life’s work is on display for all to see. If your heirs have a history of arguing (especially over who deserves what), dying without a will can make a bad family situation worse.

Not everything about an estate plan has to do with distribution of possessions. Much of an estate plan is concerned with protecting you, while you are alive.

For starters, your estate planning attorney can help you with a Power of Attorney. You’ll name a person who will handle your finances, if you become unable to do so because of illness or injury. A Healthcare Power of Attorney is used to empower a trusted person to act as a surrogate and make medical decisions for you, if you are incapacitated. Some estate planning attorneys recommend having a Living Will, also called an Advance Healthcare Directive, to convey end-of-life wishes, if you don’t want to be kept alive through artificial means.

These documents do not require you to name a family member. A friend or colleague you trust and know to be responsible can carry out your wishes and can be named to any of these positions.

All of these matters should be discussed with your children. Even if you don’t want them to know about the assets in your estate, they should be told who will be responsible for making decisions on your finances and health care.

Consider if you want your children to learn about your finances during your lifetime, when you are able to discuss your choices with them, or if they will learn about them after you have passed, possibly from a stranger or from reading court documents.

Many of these decisions depend upon your family’s dynamics. Do your children work well together, or are there deep-seated hostilities that will lead to endless battles? You know your own children best, so this is a decision only you can make.

It is also important to take into consideration that an unexpected large inheritance can create emotional turbulence for many people. If heirs have never handled any sizable finances before, or if they have a marriage on shaky ground, an unexpected inheritance could create very real problems—and a divorce could put their inheritance at risk.

Talk with your children, if at all possible. Erring on the side of over-communicating might be a better mistake than leaving them in the dark.

Reference: CNBC (Nov. 11, 2020) “What to tell your adult kids when planning your estate”

Taking a Look at the Estate of Late Soccer Star Diego Maradona

Similar to soccer star Diego Maradona’s life, the inheritance process is likely to be a mess with his big family that includes eight children from six different partners as heirs to his assets, plus his intangible heritage.

Reuters’ recent article entitled “Image rights, fast cars and a ‘tank’: Maradona’s death triggers complex inheritance” explains that Maradona, who died recently at 60 from cardiac arrest, had four children in Argentina, one in Italy, and three in Cuba, when he went there for treatment to recover from his addictions, his lawyer Matías Morla said.

02 July 1982 – FIFA World Cup – Argentina v Brazil (photo by Mark Leech/Offside/Getty Images)

“In the specific case of Maradona, he is divorced and has eight children, so the estate is divided by eight in an inheritance trial,” Buenos Aires-based soccer lawyer Martín Apolo told Reuters. “It will be a complex process.”

The probate process can last 90 days in a normal case. However, Apolo said it could be much longer with the prospect of “internal disputes” and opportunists seeking a payout from Maradona’s estate. The estate of the World Cup champion, who at the time of his death was coach of the Argentine club Gimnasia y Esgrima, includes properties, cars, investments and jewels that he was given throughout his career. He played and coached in Argentina, Spain, Italy, the United Arab Emirates, Belarus and Mexico.

There is no established value of Diego Maradona’s fortune. Celebrity Net Worth estimates his net worth at the time of his death at $500,000 but said he had earned millions during his career from contracts with the different teams and sponsorship with brands, such as Coca-Cola.

Called “Dios” for his godlike skills on the soccer pitch and “Pelusa” for his prominent mane of hair. Maradona will be valuable for his image, even after death.

“The most important patrimony here could be the image rights, and also all his shirts,” said Apolo. “How much is the one he used in the World Cup final worth? How much could you pay at auction?”

The soccer star’s family has been through several legal battles in recent years, including a trial with his ex-partner Claudia Villafañe for tax evasion, procedural fraud and misappropriation of 458 objects from his past as a soccer player. However, Maradona’s family has asked for unity in the recent weeks before his death, after he underwent brain surgery to remove a blood clot, from which he was recovering when he died.

Reference: Reuters (Nov. 27, 2020) “Image rights, fast cars and a ‘tank’: Maradona’s death triggers complex inheritance”

What Do I Need to Know about Creating a Will?

Creating a will is a simple way to lay out the way in which you want your assets to be distributed among your beneficiaries after your death. This can be a good starting point for creating a comprehensive estate plan because you may need more than just a basic will. Creating a Will

KAKE’s recent article entitled “What Is a Simple Will and How Do You Make One?” explains that a last will and testament is a legal document that states what you want to happen to your property and “worldly goods” when you die. A simple will can be used to designate an executor for the will and a legal guardian for minor children and specify who (or which organizations) should inherit your assets when you die.

A will must be approved in the probate process when you pass away. After the probate court reviews the will to make sure it’s valid, your executor will take care of the collection and distribution of assets listed in the will. Your executor would also be responsible for paying any debts owed by your estate.

Creating a will can be a good starting point for estate planning. However, deciding if it should be simple or complex can depend on a number of factors, such as:

  • The size of your estate
  • The amount of estate tax you expect to owe
  • The type of assets and property you own
  • Whether you own a business
  • The number of beneficiaries you want to name
  • Whether the beneficiaries are individuals or organizations (like charities)
  • Any significant life changes you anticipate, like marriages, divorces, or having more children; and
  • Whether any of your children or beneficiaries have special needs.

With these situations, you may need a more detailed will to plan how you want your assets to be distributed. In any event, work with an experienced estate planning attorney. With life or financial changes, you may need to create a more complex will or consider a trust. It is smart to speak with an estate planning attorney, who can help you determine which components to include in your plan and help you keep it updated.

Reference: KAKE (Nov. 23, 2020) “What Is a Simple Will and How Do You Make One?”

Can I Leave My Pet Some of My Estate?

Pet Trusts
Pet trusts are a great option for making sure your four-legged family members are cared for if something happens to you.

The Minneapolis Star Tribune’s article entitled “Who will take care of Fido when you’re gone? Minnesotans put trust in trusts reports that Minnesotans are setting up trusts to care for their pets in the event they survive them.  Floridians can do the same.

With a pet trust, there’s a guarantee that the money earmarked to care for the animal will be there for the animal as intended. A trust can designate a separate caretaker and trustee to care for the animal, manage the money, and make certain the care is being provided as instructed in the trust.

A pet trust can contain instructions on the type of food, medical care, exercise and housing the pet will get, as well as the pet’s end of life and burial or cremation directions.

A pet trust can also be used to care for an animal before the owner dies but is disabled or incapacitated. When the pet dies, depending on how the trust was created, the money left in the trust would be distributed to heirs or could go to another designated person or charity.

In states where this is not an estate planning option, a person could write in their will that a relative will inherit a pet, and the pet owner could also leave the person money to pay for the animal’s care. However, because pets are legally considered personal property, they cannot own property or inherit assets themselves. As a result, you’ll want to choose a person who will abide by your wishes and not spend the cash on themselves.

A pet trust can provide a plan for animal lovers who want to own pets late in life but may be concerned the pet might outlive them. Talk to an experienced estate planning attorney about pet trusts in your state.

Reference: StarTribune (Sep. 23, 2020) “Who will take care of Fido when you’re gone? Minnesotans put trust in trusts”

How Can Siblings Settle Disputes over an Estate?

disputes over an estate
It’s best to avoid future disputes over an estate by giving clear direction in your estate planning documents.

When a parent passes away, their assets are often divided between their children. However, if there’s no will to answer any legal questions and disputes over the estate, siblings can argue over the assets. Some even take the matter to court. It would be great to avoid disputes over the estate because, in many cases, a fight between the siblings can end their good relationship and enrich attorneys, instead of family members.

The Legal Reader’s recent article entitled “Tips to Help Siblings Avoid or Resolve an Estate Battle” says that the following tips can help people avoid disputes over an estate or assist them in preventing the fight entirely.

Use a Family Auction. With a family auction, siblings use agreed upon “tokens” to bid for the estate items they want.

Get an Appraisal. The division of an estate between the siblings can get complicated and end in a fight if the siblings want different pieces of the estate and have to work out the value difference. If, for example, the siblings decide to split the estate unevenly, and one gets a car and another a house, it’s worthwhile to engage the services of an appraiser to calculate the value of these assets. That way, those pieces of smaller value can be deducted from ones of higher value for fairer distribution.

Mediation. If siblings historically don’t get along, they may battle over every trinket left as an inheritance, no matter how immaterial. In that case, you should use a mediator to help divide the estate fairly without a court battle.

Take Turns! Sometimes, if there are several siblings involved in the division of assets, they can take turns in claiming the items within the estate. All siblings naturally have to agree to the idea with no hard feelings involved. Just like Mom would have wanted!

Asset Liquidation. If everything else fails, the easiest way to divide the assets and the estate between the siblings is to go through asset liquidation and split the proceeds.

As you can see, there are a number of ways to deal with the division of the estate and assets and prevent the legal battle between the siblings. To avoid hard feelings, stay calm, be reasonable and ask your siblings to act the same way.

Reference: The Legal Reader (Aug. 24, 2020) “Tips to Help Siblings Avoid or Resolve an Estate Battle”

What Does an Executor Do?

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”

Is an Ex-Wife Entitled to an Inheritance from Her Former Husband?

Nj.com’s recent article entitled “My brother died of COVID-19. Should his ex-wife get an inheritance?” says that it’s unlikely that an ex-wife is entitled to an inheritance from her former husband’s estate.  However, the answer is highly dependent on state law.

There are three main ways property can transfer at death. They each have different rules.

ex-wife entitled to inheritance from her husband
It is not likely that an ex-wife is entitled to an inheritance from her former husband’s estate.

Joint assets. When property is held as Joint Tenants with Rights of Survivorship (JTWROS), the surviving joint owner automatically becomes the sole owner of the property. Usually, jointly owned property is retitled into individually owned property after the divorce. If this was never done, some states automatically change JTWROS property to a different form of joint ownership, called Tenancy In Common when a divorce is finalized. As a result, with tenants in common property, when one owner dies, his or her 50% ownership interest becomes a probate asset and passes pursuant to his or her will (or the state’s intestacy laws, if they didn’t have a will).

This means that even if the husband in this scenario still owned JTWROS property with his ex-wife when he passed away, she wouldn’t automatically inherit his share. She still has her own 50% share that she owned all along.

Beneficiary designations.  Property can also pass by beneficiary designation, like with life insurance or retirement accounts.

Beneficiary designations are typically updated after a divorce. However, again, ask an experienced estate planning attorney about your state laws. For example, some state’s laws revoke a divorced spouse as beneficiary, even if the beneficiary designation was never updated.

In this situation, even if the husband named his wife as a beneficiary on an insurance policy or retirement accounts and never changed it, she wouldn’t be able to collect.

Probate.  Finally, the third way that property can pass, is through the probate process. This means there’s a will.  If there was no will, it would be pursuant to the state’s intestacy laws.

An ex-spouse is never entitled to inherit property under state intestate statutes.

There’s an important caveats for these rules. They can be superseded by a divorce decree. Therefore, review the divorce decree to see whether it has any relevant language.

Reference: nj.com (Aug. 4, 2020) “My brother died of COVID-19. Should his ex-wife get an inheritance?”

Scroll to Top