Steps to Prevent a Contested Will

Emotions can run high at the death of a family member. If a family member is unhappy with the amount they received (or didn’t receive) under a Will, a Will contest may ensue. 

iStock_will

Generally, only a person’s closest heirs, or “distributees” are able to contest a Will. Will contests can drag out for years, keeping all the beneficiaries from getting what they are entitled to. It may be impossible to prevent heirs from fighting over your Will entirely, but there are steps you can take to try to minimize squabbles and ensure your intentions are carried out.

Your Will can be contested if an heir believes you did not have the requisite mental capacity to execute the Will, someone exerted undue influence over you, someone committed fraud, or the Will was not executed properly.

The following are some steps that may make a will contest less likely to succeed:

  • Make sure your Will is properly executed. The best way to do this is to have an experienced elder law or estate planning attorney assist you in drafting and executing the will. Wills need to be signed and witnessed, usually by two independent witnesses.
  • Explain your decision. If family members understand the reasoning behind the decisions in your Will, they may be less likely to contest the Will. It is a good idea to talk to family members at the time you draft the will and explain why someone is getting left out of the Will or getting a reduced share. If you don’t discuss it in person, state the reason in the Will. You may also want to include a letter with the Will.
  • Use a no-contest clause. One of the most effective ways of preventing a challenge to your Will is to include a no-contest clause (also called an “in terrorem clause”) in the will. This will only work if you are willing to leave something of value to the potentially disgruntled family member. A no-contest clause provides that if an heir challenges the Will and loses, then he or she will get nothing. You must leave the heir enough so that a challenge is not worth the risk of losing the inheritance.
  • Prove competency. One common way of challenging a Will is to argue that the deceased family member was not mentally competent at the time he or she signed the Will. You can try to avoid this by making sure the attorney drafting the Will tests you for competency. This could involve seeing a doctor or answering a series of questions.
  • Remove the appearance of undue influence. Another common method of challenging a Will is to argue that someone exerted undue influence over the deceased family member. For example, if you are planning on leaving everything to your daughter who is also your primary caregiver, your other children may argue that your daughter took advantage of her position to influence you. To avoid the appearance of undue influence, do not involve any family members who are inheriting under your Will in drafting your will. Family members should not be present when you discuss the Will with your attorney or when you sign it. To be totally safe, family members shouldn’t even drive you to the attorney’s office.

Bear in mind that some of these strategies may not be advisable in certain states and certain situations. Feel free to talk to me about the best strategy for you.

(For more information on Wills click here.)

Regards,

Brian A. Raphan, Esq.

No will or estate plan? Big problem for you and your heirs

Estate planning isn’t just for the wealthy. Financial advisors say that most Americans can benefit from it. Read on and see how you can benefit even if you are not worth millions.

Sarah O’Brien | Tuesday, 9 Aug 2016 | 7:50 AM ET

About 10 years ago, financial advisor Andrew Rafal was involved in helping a husband and wife create an estate plan. Six days after all the documents were in order and signed, the husband unexpectedly died from an aneurysm.

Thanks to the couple’s planning, the surviving wife was able to access and assume ownership of assets that otherwise would not have been available immediately.

“It would have been a very different situation if they hadn’t finalized their estate plan,” said Rafal, founder and president of Bayntree Wealth Advisors. “In a time of grieving, it’s one less thing to go through.”

While estate planning is often associated with the wealthy, financial advisors say that most Americans can benefit from it.

Senior man pensive

Lee Edwards | Getty Images

“It’s not just for the wealthy; it’s for all of us,” Rafal said. “And the earlier you start, the better.”

The most basic part of estate planning is a will, which more than half of Americans die without, according to various data. Advisors caution that dying intestate (having no will) will result in a state court deciding who gets your assets and, if you have children, who will care for them.

This means that if you have an unmarried partner or a favorite charity but no will, your assets won’t end up with them. Typically, the courts will pass on assets to your closest blood relatives, even if that wouldn’t have been your first choice.

“Everyone should have a will,” Rafal said. “It allows assets to go to beneficiaries you name. And if you have children who are minors, it names a guardian, which is extremely important.”

“As people go through different milestones in life, they need to change their beneficiaries. The beneficiary trumps any other estate planning you do.”-Andrew Rafal, founder and president of Bayntree Wealth Advisors

Another often-overlooked element of estate planning is updating beneficiaries on financial assets such as individual retirement accounts, 401(k) plans and life insurance policies. Regular bank accounts, too, should have beneficiaries listed on a payable-on-death form, also known as a POD, which your bank can supply.

“As people go through different milestones in life, they need to change their beneficiaries,” Rafal said, explaining, “If you had your parents listed and then you get married, those assets go to your parents. The beneficiary trumps any other estate planning you do.”

Certified financial planner Aaron Graham had a client who, after a divorce, updated his will to exclude his ex-wife. But because the client’s beneficiary designations were not updated, his ex-wife received his retirement account assets.

“Thankfully, the ex-wife was cooperative with the children of the deceased, but that’s not always the case,” said Graham, a financial advisor at Abacus Planning Group.

If no beneficiary is listed on those assets or the beneficiary has already passed away, the assets automatically go into probate. That’s the process by which all of your debt is paid off and then the remaining assets are distributed to heirs.

Each state has its own laws governing how long creditors have to make a claim against the decedent’s estate, but it typically is about six months to a year.

In the case of Rafal’s client, for instance, if the wife had not been listed as a beneficiary on her husband’s retirement and stock accounts, those assets would have first gone into probate and she would have had no claim to them until probate was completed.

Another part of estate planning involves what Rafal calls “lifetime management.” That is, for starters, creating legal documents that give powers of attorney to specific people in your life if you are alive but incapacitated.

A medical power of attorney lets the chosen person make important health-care decisions if you cannot; a person with durable power of attorney will act as your agent if you become unable to tend to your finances.

Granting your own wishes

Rafal said those people could be one and the same, but most often, people name two separate people.

“You might have someone who’s not great with finances but you trust the person to make medical decisions for you, or vice versa,” Rafal explained. “Durable power of attorney lets a person step in if you are unable to make decisions.”

Tied to that is a living will. It states your wishes if you are on life support or have a terminal condition.

“Do you want to prolong [your] life at all costs, or do you have specific instructions on when and how you would like for life-saving measures to be implemented?” Graham said.

The idea is that it will be your wishes, not someone else’s.

Have you made your annual financial checklist?

   WIN-Initative | Getty Images

As far as taxes go when it comes to estate planning, chances are, you won’t have to worry about the estate tax.

“It’s important to remember that 99 percent of all people don’t need to focus on the tax aspects of estate planning,” said Pete Lang, president of Lang Capital. “For the vast majority of the population, there will be no gift or estate tax.”

For 2016, the Internal Revenue Service will impose taxes on estates whose assets exceed $5.45 million. Roughly 0.02 percent of the population ends up paying the estate tax in any given year.

Estate planning also “helps protect against families fighting, or someone potentially contesting the wishes of the deceased,” Rafal said. “We’ve had new clients come to us who didn’t have proper planning, and their families have been torn apart.”

Rafal said it’s also important to make a list — handwritten or electronic — of all your assets and where they are.

“It makes it so much easier upon death or incapacity so your family isn’t running around wondering what you have or don’t have,” he said.

DOWNLOAD YOUR FREE ESTATE PLANNING GUIDE >>>

Did rockstar Prince die without a Will?

Who will get his millions?

Screen Shot 2016-04-27 at 11.14.52 AM

This article in USA Today states; Prince left no will, according to documents filed Tuesday by his sister, Tyka Nelson, in probate court for Carver County, Minn., where the beloved pop icon died suddenly last week at his Paisley Park compound.

“The Decedent died intestate,” Nelson said in her petition for the appointment of a special administrator to deal with Prince’s estate, which has been widely reported to be valued at $300 million.

Nelson said her brother left no surviving spouse, no children and no parents.  Besides Nelson, his full sister, he is survived by half-brothers and half-sisters, whom Nelson names in her petition as “interested parties” to the Prince estate to her knowledge thus far.

The adult half-siblings are: John Nelson, Norrine Nelson, Sharon Nelson, Alfred Jackson and Omar Baker. She also listed another half-sister, Lorna Nelson, who has died and did not have children. There was at least one other sibling identified as a stepbrother, Duane Nelson, who also has died, but Tyka Nelson did not list him as an interested party.

“I do not know of the existence of a Will and have no reason to believe that the Decedent executed testamentary documents in any form,” Tyka Nelson stated in the petition.

It’s possible there is a will and Nelson doesn’t know about it, but no one has come forward yet to say so. Calls to the office of Prince’s longtime attorney, L. Londell McMillan, were not answered.

When someone dies intestate, without a will, a probate court takes over the administration of the decedent’s estate and distribution of assets, which Nelson listed as “Homestead, other real estate, cash, securities and Other.”

Her petition said Prince had “substantial assets consisting of personal and real property that requires protection.” He “owned and controlled business interests that require ongoing management and supervision.” And he “has heirs whose identities and addresses need to be determined.”

She said “an emergency exists to the extent that the appointment should be made without notice because immediate action and decisions need to be made to continue the ongoing management and supervision of Decedent’s business interests; and because the names and addresses of all interested parties are currently unknown.”

She named Bremer Bank, National Association, as Prince’s longtime banker, which would be in “the best position of any corporate trust company to protect the Decedent’s assets pending the appointment” of an executor.

According to estate lawyers contacted by USA TODAY, when there is no will, state laws on inheritance prevail. In Minnesota, for instance, half-siblings are treated the same as full siblings for the purposes of inheritance. Nelson’s filings on Tuesday come as a surprise. Estate lawyers and Prince’s former manager, Owen Husney, said they would have expected Prince to have drawn up a will and an estate plan long ago.

Husney said he was too smart to have overlooked something that crucial and he had teams of lawyers, business managers and accountants over the years who would have advised him it was crucial.

So what’s the lesson learned here? Let’s start with you should have a Will.

If you die without a Will, the people who inherit may not be those you want to receive your money or personal property when you die!  This could include remote relatives you haven’t spoken to in years. If the Public Administrator is appointed to administer the estate, they will auction or dispose of your intimate personal property and your family may never have an opportunity to receive, or pass on, items which may have wanted them to have.

If you die without a Will in New York, your estate will pass under the laws of the State of New York. When an estate is handled by the Public Administrator, heirs may be required to partake in potentially lengthy and costly legal proceedings to prove their relationships before they can inherit. The Court may also appoint a “Guardian ad Litem” for “unknown” persons.  This Guardian ad Litem, along with the Public Administrator, will get a fee from your estate! If your heirs cannot prove their relationship to the Court, your estate may be paid to the State of New York.

Having a Will can ensure those you select inherit from you, reduce expenses, and expedite handling of your estate. It also allows you to nominate an Executor, who is the person who collects your assets and delivers them to your beneficiaries.  If you have the right Executor, your estate should move swiftly. Lastly, if you already have a Will and haven’t reviewed it in over two years, now is the time to do so to ensure your current wishes are carried out.

If you have any questions about drafting a Will or revising an existing Will feel free to reach out to me.

Regards,

Matthew S. Raphan, Esq.

mraphan@raphanlaw.com

BB King heirs to challenge his Will and actions of manager

Associated Press in Las Vegas

Lawyer for daughters and other heirs alleges business manager misappropriated millions, had been untruthful and was unqualified to be executor.

BB King's Will

A lawyer representing a group of BB King’s heirs said on Saturday they would challenge the blues legend’s will and the actions of his longtime business manager-turned-executor of his affairs.

Attorney Larissa Drohobyczer issued a statement early on Saturday, just hours before a private memorial service in Las Vegas.

King was 89 when he died at his home in Las Vegas earlier this month. Fans lined up for a public viewing of his body on Friday. His body will be flown back to Memphis, Tennessee, on Wednesday. A tribute is scheduled that day at WC Handy Park on Beale Street.

A public viewing is scheduled for Friday at the museum that bears his name in Indianola, with a funeral on Saturday at nearby Bell Grove Missionary Baptist church. He will be buried during a private service on the museum grounds.

Drohobyczer’s statement alleged that LaVerne Toney had misappropriated millions of dollars, had been untruthful, had “undue influence” and was unqualified to serve as executor of the estate.

Drohobyczer says she met with five adult King daughters – Patty King, Michelle King, Karen Williams, Barbara King Winfree and Claudette King Robinson – and several other heirs before issuing the statement.

Toney told the Associated Press that she was not going to immediately respond. She said she hoped Saturday’s memorial would be calm, peaceful and respectful.

Hundreds of fans, meanwhile, were expected on Sunday at the 35th annual BB King Homecoming Festival, a free gathering that the legendary bluesman started in his hometown, Indianola.

Performers were scheduled to include a country blues band called the North Mississippi Allstars; a Bentonia, Mississippi, blues guitarist and singer, Jimmy “Duck” Holmes; and a children’s choir based at the BB King Museum and Delta Interpretive Center in Indianola.

King played at the free festival dozens of times. He drew a larger than usual crowd in 2014, which was already billed as the final homecoming performance for the King of the Blues.

While King was alive, organisers were planning this year’s event as a tribute to him. Since his death on 14 May, they have called it a memorial celebration. The festival is held on the grounds of the museum that opened in 2008.

“We certainly will miss his infectious smile and warmth this year, but we have no doubt he would want us to carry on with this tradition,” the museum’s executive director, Dion Brown, said in a statement.

For 5 Reasons to Review Your Will click here.

Learn the difference between a Will & a Trust click here.

To make sure you have an iron clad will, you can reach me here.

Regards,

Brian

The Law Offices of Brian A. Raphan, P.C.

7 Penn Plaza, New York, NY 10001

http://www.RaphanLaw.com

“SERVING THE LEGAL NEEDS OF

CLIENTS FOR OVER 25 YEARS”

Legal DIY Web Sites Are No Match for a Pro, Consumer Reports Concludes

After road testing three leading Web sites that help you create your own will, power of attorney, and other important legal documents, Consumer Reports has concluded that none of the will-writing products is likely to entirely meet your needs unless those needs are extremely simple.

Consumer Reports

The independent non-profit testing agency evaluated three online services: LegalZoom, Nolo, and Rocket Lawyer. Using online worksheets or downloads, researchers created a will, a car bill of sale for a seller, a home lease for a small landlord, and a promissory note. They then asked three law professors — including Gerry W. Beyer of Texas Tech University School of Law, who specializes in estates and trusts — to review in a blind test the processes and resulting documents.

In his evaluation of the will-making programs, Prof. Beyer said that two of them could create good simple wills but he found deficiencies in all three, including features that could lead a user to add clauses that contradict other parts of the will.

Consumer Reports’ verdict?   “Using any of the three services is generally better than drafting the documents yourself without legal training or not having them at all. But unless your needs are simple—say, you want to leave your entire estate to your spouse—none of the will-writing products is likely to entirely meet your needs. And in some cases, the other documents aren’t specific enough or contain language that could lead to ‘an unintended result,’ in [a professor’s] words,”

An article on the study, titled “Legal DIY websites are no match for a pro,” appeared in Consumer Reports.  To read it, click here.

Consumer Reports’ findings accord with ElderLawAnswers’ own evaluation of online estate planning programs. For their White Paper on these programs, click here.

For a FREE DOWNLOAD : GUIDE TO ESTATE PLANNING click here.

Using a No-Contest Clause to Prevent Heirs from Challenging a Will or Trust

If you are worried that disappointed heirs could contest your will or trust after you die, one option is to include a “no-contest clause” in your estate planning documents. A no-contest clause provides that if an heir challenges the will or trust and loses, then he or she will get nothing.

Last Will & TestamentA no-contest clause may be a good idea if you have a beneficiary who may be upset by the property distributed to him or her. However, no-contest clauses (also called in terrorem clauses) only work if you are willing to leave something of value to the potentially disgruntled heir. You must leave the individual enough so that a challenge is not worth the risk of losing the inheritance.

Most states allow no-contest clauses, but there may be restrictions. In many states, if the contest is based on probable cause or good faith, then the no-contest clause is unenforceable. That means that if the court determines there is a good reason for the contest, the clause won’t prevent the challenging heir from inheriting. In addition, a no-contest clause may apply to some portions of your estate plan, but not others. For example, your heirs may be able to challenge your executors without violating a no-contest clause.

Two states –Florida and Indiana — will not enforce no-contest clauses no matter what. If you write your will in a state that enforces no-contest clauses and then move to Florida or Indiana, the no-contest clause will be void.

If you include a no-contest clause in your estate plan, you need to be sure there are no mistakes. If you leave out important property or aren’t clear about property in your possession, your heirs could be completely disinherited if they try to fix any mistakes.

While a no-contest clause can be a good tool, there are other ways to discourage a will contest. To contact me about Wills or this info email: info@raphanlaw.com

To subscribe to my FREE Monthly newsletter, click here.

Regards, Brian

http://Raphanlaw.com