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New York Pour-Over Will

While a will is one of the most common parts of an estate plan and often the primary means for wealth transfer, for a variety of reasons, many people opt to instead use a revocable living trusts as the primary means to transfer their wealth to their loved ones. If your preference is to have a trust in lieu of a last will and testament as your primary method for asset distribution, you should still execute a specific type of will, called a “pour-over” will. A pour-over will is a special type of last will and testament that is designed for use along with a trust-based estate plan. To learn more about the importance of having a pour-over will if you have a living trust, contact an experienced New York pour-over will lawyer at the Law Offices of Stephen Bilkis & Associates.

Benefits of a revocable trust

A revocable trust is a trust that you as the “trustmaker” makes and funds during your lifetime. You can transfer real estate, vehicles, jewelry, collectibles, and other assets to your trust. During your lifetime you are also the trustee. This allows you to retain control over the assets that you transfer to the trust. In addition, during your lifetime you can change the terms of the trust, including the beneficiaries as anytime as long as you are not mentally incapacity. You can also revoke the trust.

One of the main reasons that when creating an estate plan, many people decide that a revocable trust is preferable over a will is because a revocable trust allows beneficiaries access to estate assets quicker than a will does because assets held in a trust are not required to go through probate. Probate is the process during which your will is proved. Once that happens, before your assets can be distributed to your beneficiaries, your affairs must be settled. This involves your assets being inventoried, your bills being paid, and your taxes being paid. In New York probate and administration typically takes at least 8-9 months and often takes longer. Until administration ends, your assets cannot be distributed to your beneficiaries.

Because trust assets do not have to go through probate, typically there is a much faster distribution to beneficiaries. Your successor trustee will distribute your assets to your beneficiaries based on the terms of the trust.

Another advantage of avoiding probate is that your estate will avoid the expense related to probate. Probate involves court fees as well as fees to the executor. In addition, if there are complications such as a will contest or other estate litigation, the fees associated are typically paid out of estate assets. This means that ultimately there will be fewer assets available to pay beneficiaries. On the other hand, because revocable trusts do not go through probate, they are not subject to the fees and expenses associated with probate.

Also, unlike a will, a trust agreement is not usually made public, allowing the instructions in your trust to remain private. Because wills are filed with the Surrogate’s Court and probate is a public process, others will be able to access it and learn its contents. As a New York pour-over will lawyer will explain, anyone can go to the Surrogate’s Court and read your will. Generally, no one aside from the beneficiaries are entitled to see a trust document. The only reason that a trust will become public is if it becomes the subject of litigation.

Pour-over will

While creating and funding a revocable trust can help minimize the impact of probate on your estate and your beneficiaries, it is still important to have a will. However, instead of creating a traditional will in which your state who gets your specific assets, a pour-over will simply states that any assets that have not been funded into your revocable living trust should go there upon your death. Basically, instead of your individual loved ones being the beneficiaries of your estate. When you die any assets that remain in your probate estate “pour-over” into your revocable trust.

Even if your intention is to transfer all of your assets to your trust during your life time and you take steps to do so, there remains a strong possibility that upon your death there still remains probate assets in your estate that have not been transferred to your trust. No matter how organized and deliberate you may be, it is nearly impossible to ensure that all of your estate assets are transferred into a trust prior to your death. You may overlook assets. You may acquire assets right before your death. If you do not have a will, pour-over or otherwise, any assets that remain in your probate estate will be subject to New York’s intestate succession laws.

Pour-over wills require probate

While one the primary reasons that you might opt to created a revocable living trust is to avoid probate, it is important to understand that pour-over wills must be probated. This does not stop the assets that you transfer to your trust prior to your death to be distributed quickly based on the terms of the trust. What it means is that any assets that any assets that remain in your probate estate are subject to probate.

Just like with other types of wills, when you make a pour-over will, you will name someone in the will to serve as the executor of your estate. That person is charged with completing the activities necessary to settle your estate. The process begins with your executor filing your pour-over will with the Surrogate’s Court along with a petition for probate. Once the Surrogate’s Court admits the will to probate and formally appoints the executor, the executor then goes about the activities required to wind up your estate. This is the administration process. The executor must gather and inventory estate assets, pay estate debts, expenses, and taxes, and eventually transferring the assets to the beneficiaries named in the will. In the case of a pour-over will, however, the executor’s job is simpler. When it comes to asset distribution, all he must do is transfer all assets that pass under the will and put them into the living trust.

As a New York pour-over will lawyer will explain, it is important to understand which of your assets are subject to probate and, therefore, would be “poured-over” into your trust during the administration process. Generally speaking, probate assets include all personal and real property that you individually. This may include cars, motorcycles, boats, furniture, appliances, jewelry, artwork, clothing, cash, bank accounts, and real estate. It would also include your interest in property that you co-own with others as a tenant in common such as real estate.

On the other hand, property that is not classified as probate property is not subject to probate and would not be “poured-over” into your trust during the administration process. Non probate property includes real estate that is held in joint tenancy or as tenants by the entirety, bank or brokerage accounts with payable on death (POD) or transfer on death (TOD) beneficiaries, life insurance or brokerage accounts that list someone other than the decedent or the decedent’s estate as the beneficiary, and retirement accounts. Of course, any assets that are already in your trust are not probate property.

When planning your estate, check the ownership of your property and your accounts to make sure jointly owned property will be distributed the way you want it to. It is also important to review your beneficiary designations. For help with this, contact an experienced New York pour-over will lawyer.

Successor trustee’s duties

When you initially create your living trust, you will name yourself as the trustee. It is important to also name a successor trustee. This is the person who would take over the duties of managing the trust once you pass away. A successor trustee’s job is similar to that of an executor, except that that the trustee has control only over trust assets. In other words, while the property is still part of your estate, the executor is in charge of it. Once it is “poured-over” into your trust, your successor trust is in charge of it. Your trustee will then distribute trust assets to the trust beneficiaries according to the terms of the trust. A trustee, unlike an executor, does not need the Surrogate’s Court’s approval to act.

Remember, you control what happens to trust assets. You name the beneficiaries and you determine when and how the assets will be distributed. The trustee must follow the instructions you left in the trust document. If you want all trust assets given to the beneficiaries right away after you pass away, that is what the trustee will do. If you want all or a portion of the assets to stay in the trust, to be managed for the benefit of your children, grandchildren, or someone else, the trustee will keep them in the trust.

Absence of a pour-over will

If you have a revocable trust, but you do not have a pour-over will or any other type of will, any property that remains in your probate estate after your death will go to your heirs according to New York’s intestate succession statute. Under the intestate succession statute, your legal heirs are your surviving spouse and your children. If you have neither, your property will go to parents, siblings, or other relatives. As an experienced pour-over will attorney in New York will explain, this means that if you fail to fund property into your trust, and you do not have a pour-over will or any other type of will that directs the property to someone specific, that property might go to a relative you do not know or like.

Contact the Law Offices of Stephen Bilkis & Associates

If you have questions related to setting up a living trust and creating a pour-over will, contact the Law Offices of Stephen Bilkis & Associates. With over 20 years of experience representing individuals, executors, fiduciaries, beneficiaries, and heirs, we have the knowledge and resources to help you create a trust, a will, and overall estate plan that is consistent with your wishes and the requirements of New York law. Contact an experienced pour-over will attorney serving New York in our office at 1-800-NY-NY-LAW (1-800-696-9529) to schedule a free, no obligation consultation regarding your case. We represent clients in the following locations: Manhattan, County, Suffolk County, Queens, Bronx, Brooklyn, Long Island, Staten Island, and Westchester County.

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