An important concern for all individuals is the protection of assets from creditors, lawsuits, and rising long-term care costs. Asset protection is shielding your wealth from unforseen circumstances. Assets not protected include cash, stocks and bonds, bank accounts, brokerage accounts, certificates of deposit, second residences, real estate, oil and gas properties, and closely-held businesses. Certain types of strategies can assist with asset protection.

Your last will and testament is a guide on how to disseminate your assets upon passing. It is among the most important tasks you can make to ensure a smooth and seamless distribution of your estate. Without a last will and testament, states each have pre-determined laws governing the rights of surviving spouses, heirs, and next of kin to your property.

A trust is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries.

Since trusts usually avoid probate, your beneficiaries may gain access to these assets more quickly than they might to assets that are transferred using a will. Additionally, if it is an irrevocable trust, it may not be considered part of the taxable estate, so fewer taxes may be due upon your death.

Assets in a trust may also be able to pass outside of probate, saving time, court fees, and potentially reducing estate taxes as well.

Other benefits of trusts include:

Control of your wealth. You can specify the terms of a trust precisely, controlling when and to whom distributions may be made. You may also, for example, set up a revocable trust so that the trust assets remain accessible to you during your lifetime while designating to whom the remaining assets will pass thereafter, even when there are complex situations such as children from more than one marriage.

Protection of your legacy. A properly constructed trust can help protect your estate from your heirs' creditors or from beneficiaries who may not be adept at money management.

Privacy and probate savings. Probate is a matter of public record; a trust may allow assets to pass outside of probate and remain private, in addition to possibly reducing the amount lost to court fees and taxes in the process.

Trusts may offer protection from long-term care costs and Medicaid spend downs or estate recovery lawsuits or liens.

Guardianships are a legal solution for adults unable to make informed decisions regarding their assets and person due to mental incapacity. A guardian is appointed by the Court as the individual’s decision maker for matters related to health care, finances, and other personal affairs. Guardianship is a last resort and lesser restrictive alternatives need to be sought first. Often, a carefully drafted durable power of attorney, supported decision making agreement, or health care proxy can obviate the need for a guardianship.

Elder law is a holistic, multidisciplinary practice that concentrates on representation, legal counseling, and assistance to seniors, people with disabilities, and their families in connection with a variety of legal issues, from estate planning to long-term care issues, with an emphasis on promoting the highest quality of life for the individual. The person-centered approach considers legal, medical, financial, social, and family issues. Qualified elder law and special needs planning attorneys bring a different perspective to the delivery of services to their clients.

Elder law attorneys help older adults and their families in a caring, compassionate way that seeks to preserve dignity for such individuals. Elder law and special needs planning attorneys look at what is best for their clients from all points of view, and are able to address these issues in an objective way.

Often, long-term care needs are expensive and can drain someone’s financial resources quickly and may leave the well spouse impoverished. Oftentimes, families with moderate wealth are left to plan to apply for Medicaid to cover nursing home and home care costs. It is important to plan for disability and long-term care early, so that you can preserve your wealth outside of any lookback period.

Medicaid planning can also occur at the time of disability or the need for a nursing home arises, and different planning methods are used. The goal is to not have a person’s assets and income go entirely toward their cost of care, leaving them unable to provide for themselves or their spouse.

Individuals with disabilities who receive public benefits would benefit further from having funds in a trust (or other exempt account) to maintain their quality of life and pay for beyond what their benefits can provide. When an individual who receives public benefits also receives money, the public benefits may be jeopardized. This situation may arise when the individual receives a personal injury or divorce settlement, an inheritance, or other funds. Regardless of the source of the funds, once the individual has money in his or her own name, the public benefits may be at risk. To protect the public benefits, the excess funds can be placed in a Special Needs Trust. A Special Needs Trust is used to supplement, not replace, public benefits such as Supplemental Security Income (SSI) or Medicaid. There are several planning options and the advice of an experienced Special Needs Planning attorney is needed.

Parents should consider their own Wills and gifting the distribution to a child with disabilities in the form of a third party testamentary supplemental needs trust to avoid a termination of their child’s benefits. Other planning tools involve using the IRS tax rules to stretch IRA funds for children with disabilities beyond the 10-year rule the SECURE Act put in place in 2020. ABLE accounts also allow individuals with disabilities to have access to some funds giving them more independence while keeping their benefits intact.

If you served in the United States Armed Forces, you may be eligible for additional benefits from the U.S. Department of Veterans Affairs (“VA”). Veterans and surviving spouses of Veterans who need help with activities of daily living may receive assistance through the VA. VA benefits can be a great help to a loved one needing care at home or in other care settings.

If you or your spouse served 90 consecutive days and at least one of them was during wartime and you need assistance with your activities of daily living, you could be due a tax-free benefit of up to $26,752 as a single Veteran, $31,714 as a married Veteran, or $17,192 as a surviving spouse of a Veteran (based on 2023 benefit levels). This benefit could be used for in-home care, assisted living or nursing home care. In some cases, it can even be used to pay for a child or someone else to care for you in your home.

Most VA service centers and Veterans organizations can help you apply for this benefit, however, Andrea can help you if you have been turned down for Aid & Attendance benefits. She will review your denial letter for no charge and is able to appeal on your behalf as an Accredited VA Attorney. The VA pension program has a 3-year lookback period much like Medicaid, so oftentimes, your estate plan and financial eligibility have an impact on your ability to receive these earned benefits, and if you are already receiving benefits, it is important that you remain within the means-tested limits of the program as you go forward. Estate planning tools may be of assistance to individuals in this situation.

What Is Probate and Estate Administration in New York?

When someone dies in New York, their estate must go through a legal process before assets can be transferred to heirs or beneficiaries. This process is known as probate (if there’s a will) or estate administration (if there’s no will). Both take place in New York Surrogate’s Court and follow specific legal steps to ensure debts are paid and assets are properly distributed.

What Is Probate in New York?

Probate is the legal process used when a person dies with a valid will. Generally, the will must be submitted to the Surrogate’s Court in the county where the deceased lived. The court reviews the will to ensure it is legally valid and appoints the executor named in the will to manage the estate.

Responsibilities of the executor include:

• Filing the will with the court

• Notifying heirs and beneficiaries

• Identifying and gathering estate assets

• Paying debts, taxes, and final expenses

• Distributing remaining assets according to the will

Probate in New York typically takes several months to a year, depending on the complexity of the estate.

What Is Estate Administration in New York?

Estate administration applies when someone dies without a will—this is called intestacy. In this case, a family member or interested party must petition the Surrogate’s Court to be appointed as the administrator of the estate.

The administrator performs similar duties to an executor but distributes assets based on New York intestacy laws. These laws determine who inherits and in what order—starting with a spouse and children, then moving to other relatives.

What Assets Go Through Probate or Estate Administration?

Only assets owned solely by the deceased are subject to probate or administration. These may include:

• Solely titled real estate

• Bank accounts without a joint owner or named beneficiary

• Personal property (cars, valuables, etc.)

Assets that avoid probate include:

• Joint accounts with rights of survivorship

• Retirement accounts with named beneficiaries

• Life insurance policies

• Trust assets

Proper estate planning can help minimize the need for probate and speed up the distribution of assets.