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Estate Planning Archives

How to account for an IRA in an estate plan

New York residents can generally leave funds within an IRA to whoever they feel deserves it the most. If there is no person worthy of receiving the money, it may be possible to donate it to a charity. However, how an IRA is transferred generally depends on who is receiving it. For instance, if an IRA is left to a spouse, he or she could simply roll that money into his or her own account.

The importance of choosing the right trustee

When New Yorkers are planning their living trusts, they will need to consider who to name to serve as their successor trustees. This decision is important because administering a trust is a complex and technical process, and the trustee must also be someone who can be trusted to work in the best interests of the beneficiaries.

What to consider when creating a power of attorney

New York residents may be able to plan for what happens to assets after they die by creating a will or trust. However, there is also a way to plan for what happens if an individual becomes mentally incapacitated while still alive. By adding a power of attorney, an individual can appoint an individual or entity to manage his or her financial affairs.

Funeral trusts for estate planning

New York residents might like to know about funeral trusts. Planning one's own funeral ahead of time by using a trust will make the process much easier down the line for surviving family members. A funeral trust also allows a person to arrange a service based on personal preferences.

Managing a residence in a QPRT

While a qualified personal residence trust may be less necessary for people in New York and others throughout the country today because of the large exemptions for estate and gift tax, many people will still have these as part of their estate plan. A QPRT works by removing the home from a person's ownership and placing it in a trust for a fixed amount of time. This reduces taxes on the home at the person's death. If the person dies before the end of the fixed term, the benefits are lost. Neither the grantor nor the spouse can repurchase the home at the end of the fixed term.

Using irrevocable trusts to protect assets

When New York residents have worked hard all of their lives to provide for their families, they want to ensure that they protect the assets that they have obtained. However, many residents who start the estate planning process still want to maintain some form of control over those assets while they are alive. One way to do this is through an irrevocable trust.

Finding the right trustee

Trusts can be an important part of estate planning that help benefactors take care of their heirs. However, the good intentions of a grantor sometimes turn disastrous when the wrong person serves as a trustee.

Advantages of trusts for charitable giving

New York residents who would like to give to charity and provide for their loved ones in their estate plan can do both with a charitable trust. There are two types of charitable trusts. With a charitable remainder trust, a person places assets in the trust and then chooses a time period for the trust to pay distributions. This might be for up to 20 years. It can also be for the lifetime of the beneficiary. After the term ends, the remainder of assets in the trust go to the charity. A charitable lead trust works in reverse in that it funds a charity for a certain period of time after which the remaining assets go to another beneficiary.

Benefits of IRA trusts

New York residents who have individual retirement accounts can use two types of IRA trusts to protect any funds that are left to heirs. Individuals can spend IRA funds as they wish as long as they only take the mandated minimum required. However, for heirs that may have a tendency to not spend money wisely, account holders can use a trust to make sure that the funds are distributed in a sensible manner.

Steps to take after making an estate plan

An estate plan may give a testator more control over his or her assets after death. However, New York residents should know that without good communication, an estate plan could lead to fights between family members. A disorganized plan could also make it difficult for estate holders preserve wealth for future generations.