Questions and Answer on Wills
1. What is a Will?
A Will is a legal document that states the wishes of a "testator" those who will receive their property after death ("beneficiaries"). It also names an "executor" to "administer" the estate, which means they assemble the assets, pay debts, distribute the property to the beneficiaries and keep an account of all assets. This document is referred to formally as a "Last Will and Testament."
A Will can provide conditions on gifts so that property will go to the beneficiary only after they reach a certain age, or meet other qualifications, like completing college. It can also provide for a trustee to manage the assets, so the beneficiary has some use of the funds but not complete control.
2. Who should have a Will?
Adults who own property who want to choose beneficiaries of their property should have a Will. They should also have Wills if they want to choose who will take charge of their estate and who will act as guardian to their children. Wealthy individuals should use Wills to minimize estate tax applicable in 2011 and 2012, to estates of $5 million or more.
3. What formalities are required for signing a Will?
The signing of a Will is always accompanied by legal formalities, to provide the greatest assurance that the testator acts with understanding and free will. A Will signing ("execution") is usually performed under an attorney’s supervision. In New York, two witnesses are required but three are often used. They must sign a statement that the testator appeared to be of sound mind and signed it without coercion. All signatures must be notarized.
4. What are the advantages of a Will?
Under a Will, the testator’s wishes govern who gets gifts of property and the conditions under which they receive them. Without a will, the law provides a list of beneficiaries who are the legal "next-of-kin." they may not be the same people as the testator would choose. With large estates, a Will can provide a means for saving considerable estate tax.
5. What are the disadvantages of a Will?
The only disadvantage of a will is the attorney's fee for drafting.
6. Where should a Will be kept?
An original Will should be stored in a fireproof box whose location is known by and accessible to the executor. Keeping a copy of a Will where tax documents are kept is desirable, to encourage an annual review.
7. What conditions trigger the effectiveness of a Will?
The Will is triggered by the death of the testator. After death, the executor submits the Will to Surrogate's Court for "probate." The probate process allows anyone who challenges the validity of the Will to come before the court. Usually, no challenges are made and the named executor is given authority by the court -- by documents called "Letters Testamentary" -- to collect and distribute assets.
8. Can a Will be used out of the state of residence?
Yes. A Will drafted in one state can be probated either in the state of the testator’s domicile, the state where the testator’s property exists, or both.
9. Can a living trust be used instead of a Will to designate who gets property after death?
A living trust offers immediate accessibility to assets and, usually, no court involvement concerning distribution of trust property after death. To a large extent, it can dispose of property to chosen beneficiaries. It also avoids probate, up to a point, thereby lowering court costs and avoiding delays of distribution. But the exclusive use of a living trust to distribute property would require all assets be titled in the name of the trust at the time of death. It is rare to have that occur.
Usually a few assets require probate in order to release them for distribution. Such items as medical reimbursements, dividends issued near or after the date of death, or even the proceeds of a lawsuit brought by or on behalf of the decedent often preclude complete distribution from a trust.
10. What are
common misunderstandings about Wills?
Although people generally realize that the distribution of the property given in the Will is to take place only after death, many people believe that the named executor has some legal status during the lifetime of the testator. To the contrary, an executor has no legal authority as such, to do anything during the lifetime of the individual.
Of course, if the same person is appointed to act as an agent by another document -- like a health care proxy or a durable power of attorney -- he or she can act because of the authority given to them by that document..
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