When New York residents neglect to draft an estate plan, they create a situation where others will be tasked with making important decisions on their behalf. Many people put off estate planning because contemplating end-of-life scenarios can be emotionally difficult, but resolving these matters can put an end to gnawing anxiety and provide peace of mind.
Estate planning deals mostly with how estates will be administered when an individual passes away, but it can also provide loved ones and doctors with instructions should that individual become seriously ill or incapacitated. An estate plan can also prevent bitter disputes between heirs by making the testator's position clear, and incorporating trusts will allow estates to be administered in private and away from the public glare of the probate process.
Individuals who have decided to draft an estate plan should begin by compiling a list of their assets and liabilities. This list should then be kept in a place that can be accessed easily. Once this is done, individuals and their attorneys will have an accurate understanding of the size of the estate and the kind of tax issues that must be addressed. Other important tasks include choosing executors or trustees and letting loved ones know that an estate plan has been drafted and where the documents can be found.
Attorneys with estate planning experience may explain how using annual and lifetime gift tax exemptions might allow individuals to distribute some of their assets while they are still alive to reduce the size of their estates. This may be a prudent strategy if estate taxes are likely to be high. Attorneys may also suggest using trusts to provide greater control over how assets will be distributed, which could be an important consideration if heirs have been irresponsible with money in the past or are struggling with drug or alcohol problems.