A Durable Power of Attorney is a powerful estate planning tool used to ensure that someone may act on your behalf in the event of incapacitation – but how do you make sure that your financial institutions will honor it?

Many banks carefully scrutinize Power of Attorney documents, and rightfully so.  But there have been cases in which a bank refused to accept a Power of Attorney involving one of their customers.  In fact, a recent Florida ruling awarded a gentleman $64,000 after his father’s bank refused to release funds to him from a joint account of his father even though he had a valid Durable Power of Attorney document.  At that point, a friend of his father’s, who was also listed on the account, withdrew the funds from the account.  The bank was ordered to repay the funds to the gentleman as the jury found they should have honored the legal document.

Careful planning may have avoided this situation.  Banks are trying to protect their customers’ interests as well as their own.  They are concerned they may be sued if the Power of Attorney document is found to be invalid or fraudulent.  To prevent this situation, contact your financial institution when your Power of Attorney is executed and ask what is needed to ensure the document is accepted. 

To make sure your estate planning documents are legal, valid documents, work with an estate planning attorney to ensure that not only will they be acceptable when they are needed, but that they meet your needs and goals.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

Do you plan to leave the funds in your IRA to multiple beneficiaries?  If so, consider dividing your IRA into a separate account for each beneficiary.   (Your IRA can be divided into separate accounts before your death, obviously, but also by the end of the year following your death.)

Here’s why: Say your husband is the sole beneficiary of an IRA.  When you pass away, he can roll over the IRA into his name, name his own beneficiaries, and put off taking distributions until he reaches age 70 ½.  But the only way to roll over an inherited IRA is if you are the sole beneficiary.

Or say you wish to leave your IRA to your two children.  When an inherited IRA has more than one non-spouse beneficiary, distributions must be taken based on the life expectancy of the oldest beneficiary.  Split the IRA into two separate accounts and each child can take distributions based on his or her life expectancy instead.

Think of it this way:  While it may be easier for you to keep up with one IRA account, it will be much easier for your beneficiaries to make smart choices regarding the funds you leave in an IRA after you pass away if you create separate accounts for each beneficiary.  Isn’t that your ultimate goal?

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

Asset protection is a key consideration in estate planning.   Most people seek to protect their assets through liability insurance – but what if you no longer have liability insurance in place?

A standard homeowners insurance policy typically includes some form of general liability insurance – like if a guest falls down the stairs or a friend slips in your kitchen.  Liability insurance is designed to protect you from claims made when you are in some way considered to be at fault.

That’s great – but say you or your parents decide to move to a retirement community or apartment.  Once the home is sold homeowners insurance is no longer in effect… but you could still be at risk of claims or even lawsuits.

Liability insurance policies tend to be relatively affordable.  Shop around and take the time to fully understand the terms, the situations that are covered, and the limits of the coverage you will receive.

Downsizing is a great financial move for many people; plus it can make daily life a lot simpler.  Just make sure you take care of the details:  Sometimes downsizing in one area requires a little bit of upsizing in another.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

Great estate plans accomplish a number of goals.  Chief among them is avoiding probate.  Owning property jointly is one way to avoid probate, and designating someone as the beneficiary is another.  You can even designate a beneficiary for property, using strategies like Transfer on Death and Payable on Death provisions.

Designating a beneficiary is a good way to avoid probate.  Setting up a Living Trust is a better way.  Why?

• Timing. Living Trusts allow you to specify when the beneficiary can access funds or take control of property.
• Creditor protection. Structured properly, a Trust can help prevent creditors from tapping assets held in the Trust.
• Ease of management. If you are disabled or incapacitated, a Trust can allow the trustee to take over management of assets so decisions can be made on your behalf.
• Avoids probate. If your beneficiary passes away before you do, you’ll have to name another beneficiary – or the asset(s) in question will need to enter probate.

Living Trusts are flexible estate planning tools; beneficiary designations are not.  Contact us to see how a Living Trust can accomplish a number of goals – both while you are living and after you pass away.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

First a definition:  A disclaimer is a legal method of turning down a gift that was made to you.  For estate planning purposes, disclaimers are a legal way to turn down either a gift or an inheritance.

For example, say your wife survives you.  Among other bequests, you leave a sizable bank account to your wife.  She is the primary beneficiary of the account, and your two children are the contingent beneficiaries.  So far so good, but what if your wife doesn’t need the money in the bank account, and wants to avoid paying estate taxes?  She can sign a legal document disclaiming the account; when she does, the account passes to your two children since they are the contingent beneficiaries.

The alternative is for your wife to accept the account and then give it to your children.  The problem with that approach is that the funds are counted in her estate, and gift taxes may be due as well.

Disclaimers can be a great estate planning tool under specific circumstances.  Contact us for more information on whether a disclaimer is the right way to ensure your wishes are carried out.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

Estate planning is often viewed as revolving around arranging for the transfer of assets to your loved ones. While it is true that this aspect is a large part of what it is all about, it is wise to consider all of the eventualities of aging when you are making plans for the future. It is best to implement a holistic plan that includes preparations for your active retirement years and the twilight years that will follow as well as the legacy component.

With this in mind you would do well to understand the fact that the majority of people who attain senior citizen status are going to need long-term care at some point in time. 70% of Americans who reach the age of 65 are going to require long-term care, and the average length of stay is between two and four years.

According to the MetLife Mature Market Institute the average annual expense for a private room in a nursing home in 2010 was around $83,500. The same period of time in an assisted living community would cost you about $40,000 on average.

Clearly, these costs are considerable but the good news is that many veterans are eligible for a benefit that can provide assistance should long-term care become necessary. The Veterans Aid & Attendance pension is available to veterans who need assistance with their day to day living needs. To be eligible you must have served for at least one day during a time of war out of a total of 90 days of service at minimum.

If you are a single veteran who is eligible for this benefit you could receive as much as $1632 each month to defray your long-term care costs or perhaps pay for in-home care in total. A married couple could receive as much as $1949 monthly.

Veterans A & A can have a big impact on your life if you are a qualified veteran in need of living assistance. To find out more about this resource, simply contact the Veterans Benefits Administration.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

Though estate planning is something that people of all ages should engage in, the truth of the matter is that a lot of people don’t give it much thought until they start to see their retirement years come into focus. If you are one of the many who hasn’t looked into it very deeply, you may simply assume that estate planning involves drawing up a last will to direct the transfer of your assets.

While you can certainly use a last will to detail your wishes, it is not your only choice. You may have heard about trusts but assumed that they are only useful for people who are extraordinarily wealthy. In reality the creation of a trust such as a revocable living trust can be a good option for people who would not consider themselves to be rich by any means. One of the reasons why these trusts hold appeal is because they enable the transfer of assets outside of the process of probate.

Your estate must be probated when you use a last will as your primary vehicle of asset transfer. The heirs to the estate do not receive their inheritances until the estate has been probated and closed. Probate can take quite a bit of time and just how long it takes will depend upon the jurisdiction in question and the relative complexity of the case. The infamous Anna Nicole Smith battle with the Marshall family went on for some 15 years, outliving both of the original combatants. But even simple, uncontested cases can take several months.

The time factor is just one of the reasons why probate is often avoided. There are expenses involved in the process and the goings-on are a matter of public record. Many people would like to keep their final affairs confidential.

Revocable living trusts are quite popular and as you can see they enable the avoidance of some rather unappealing circumstances. If you’d like to learn more about these trusts, simply take a moment to arrange for a consultation with an experienced Smithtown, NY estate planning attorney.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

There is a lot of information available on the Internet these days.  Because of this easy access to information, you can take care of many things on your own that used to require the assistance of others. This is clearly a positive development, but there are people who try to take advantage of the broad reach that the Internet provides in ways that could be perceived as inappropriate. To this end, Internet marketers sometimes make claims that are enticing but perhaps a bit incomplete or inaccurate.

The above is something to take into consideration if you come across websites that want you to believe that estate planning makes for a very simple do-it-yourself project. They state that all you have to do is fill in the blanks on a one-size-fits-all document that they will provide you with for a fee and you’ll then be good to go. The legacy that you have shaped throughout the entirety of your life will be seamlessly transferred to those that you love in one fell swoop with no legal guidance necessary.

The truth is that every individual is different and there are various ways to transfer assets to your loved ones. The course of action that is best for you may not be right for the next person. Some people are exposed to the estate tax and some are not. And of course there are things to consider other than the transfer of assets, such as planning for the possibility of incapacity.

Additionally, the estate plan that you initially devised is probably going to be have to be updated as time passes and your life situation changes in various ways. Are you prepared to make these changes on your own?

When something sounds too good to be true in virtually every instance it is just that. Estate planning is a serious matter and it is not something that makes for a suitable do-it-yourself project.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

The lives of famous people are often put on display by the media for public consumption, and though this can be difficult for the targets of the attention we can sometimes learn from the successes and failures of others.

This is certainly true when it comes to estate planning and we have seen many instances of high profile individuals leaving behind a mess for their family members due to a lack of proper planning.

On the other end of the spectrum, there was a recent case involving a famous individual doing a good job planning her estate.

Because of the fact that Singer Amy Winehouse was known for a rather freewheeling lifestyle many people would assume that she would be someone who would not have her financial house in order. In fact, British newspapers have reported that she did have an ironclad estate plan in place that left behind her fortune to her parents and her brother.

The thing about the Winehouse estate that is particularly instructive is the fact that under British law her former husband, Blake Fielder-Civil, could have been in line for an inheritance had Winehouse not executed the proper estate planning documents.

Clearly, changes in marital status are just about always going to necessitate an estate plan update. If your estate plan needs revising or if you have not yet made any plans for the future, right now would be a good time to take action and arrange for a consultation with a licensed and experienced Long Island estate planning attorney.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.

People who are partners in small businesses have to take a unique approach to estate planning. If you are the co-owner of a small business the value of your share in the enterprise may be considerable. If you simply leave it to your loved ones they may want to sell it for any number of reasons. Should they do so your remaining partners would be forced to deal with the outcome without having any say.

This scenario can be avoided by executing a buy-sell agreement, and this small business succession strategy often involves the purchase of life insurance.

We will look at the cross purchase plan here. All the partners in the business get together and decide on the value of an individual share. They then take out insurance policies on each other with the total of them equaling the agreed-upon value of a share in the business.

When one of the partners passes away the insurance policy proceeds will be paid out. The surviving partners then pool this money and utilize it to purchase the share in the business that was owned by the deceased partner from his or her family members.

This is one way that you can choose to proceed if you are a partner in a small business. To explore all of your options in depth, the wise course of action is to sit down and discuss your unique situation with a licensed and experienced Suffolk County estate planning attorney who has a background assisting clients who own small businesses.

Mark S. Eghrari & Associates, PLLC is a member of the American Academy of Estate Planning Attorneys.