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Virginia, Gloria and Dolly – A Room of One’s Own
I read Virginia Woolf’s A Room of One’s Own at an impressionable age. It was the 1980s, and women were grappling with issues of economic independence and freedom. I came away from that book believing, perhaps too simply, that economic independence was the key to every other kind of independence.
Many people choose to invest in a life insurance policy. Some choose to purchase a term life insurance policy wherein the insured pays a premium for a period of years and if he or she passes away during that period of time, the policy will pay out to the designated beneficiaries, while others purchase whole life insurance which works more like an investment product and has a guaranteed payout no matter the insured’s age.
Even if someone passes away with an estate below the federal estate tax exemption amount of $11.7 million dollars, if married, the estate should consider filing an estate tax return to capture the deceased spouse’s unused exemption amount.
Under Article 19 of the New York Surrogate’s Court Procedure Act, real property vests in the decedent’s heirs or legatees immediately as owners date of death. So why would someone have to go through probate to take title or sell it?
New York State has an estate tax “cliff”, which means that if an estate exceeds 105% of the New York estate tax exemption then the estate will receive absolutely no exemption from New York estate taxes and the entire value of the estate is subject to New York’s estate tax.
Whether a bank account must go through probate depends on how the account was held – jointly or in the decedent’s sole name. Like real property, bank accounts can be owned in many ways.
The 2017 Tax Cuts and Jobs Act (the “Act”) increased the federal estate tax exclusion amount for decedents dying in years 2018 to 2025. The exclusion amount for 2021 is $11.7 million. This means that an individual can leave $11.7 million and a married couple can leave $23.4 million dollars to their heirs or beneficiaries without paying any federal estate tax.
As fiduciary you are required to account to the beneficiaries, but the type of accounting will vary depending upon the actual beneficiaries and the fiduciary’s relationship with them. There are two types of accounting: informal and judicial accounting.
While the best elder law and estate plan is to have a valid health care proxy naming agents and a valid durable power of attorney naming an agent to make financial decisions, not everyone has done the proper planning. It is not uncommon for an elderly person to fall ill, be hospitalized and then need nursing home care with no time to plan.
Question: Who would inherit from an estate if someone dies without a will?
