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Debunking Common Misconceptions about Estate Planning

Estate planning is about establishing the proper safe guards to ensure your loved ones are cared for and protected in the event that a tragedy occurs. Though this process will provide you and your loved ones with peace of mind it is so often put off due to some misperceptions. In this post, expert NJ attorneys will ease your mind as we debunk the three most common misperceptions.

  1. You don’t think you are wealthy enough to have an estate plan: Despite their association with the rich and elite, estate planning is not just for the wealthy. Take a look at your life right now. Do you own any assets? A bank account? A vehicle? A home? Do you have a family you need to provide for? If you answered “yes” to any of these questions then you need an estate plan – it’s that simple.
  2. I’m too young: As scary as it may seem, life can bring about unexpected events.  No one is immune to the possibility of a tragic accident or terminal illness. A comprehensive estate plan gives you peace of mind and a sense of certainty in a more and more uncertain world. In addition, it’s also far easier and more inexpensive to start estate planning while you are younger and generally have a far less complex financial situation.
  3. It’s too complex: Estate planning is a complex legal procedure and trying to decide if you need a Living Trust, a Last Will and Testament, a Power of Attorney, or all of the above, is not an easy decision to make. Fortunately, that’s where legal assistance from experienced estate planning attorneys will help smooth the way. By looking at your situation in-depth, we can help you decide on the right course of action and develop a customized estate plan which ideally meets your needs and provides the proper protection for your assets.

Easy estate planning with our New Jersey law firm

If you want to find out more about estate planning and the benefits thereof, the law firm of Sedita, Campisano & Campisano, LLC can offer you expert estate planning advice. In addition, we can assist you with creating a trust, Last Will and Testament and drawing up Power of attorney documents. For more information, please contact us today.

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Your elder law guide to guardianship over a senior loved one

As our loved ones grow older, they may become incapable of managing their personal and business affairs. This can leave them vulnerable to scams, ill-advised decisions and the loss of assets. Luckily you can protect your senior loved one through legal guardianship. With legal guardianship a trusted individual is appointed to make personal, financial and medical decisions on behalf of your loved one. Here, elder law attorneys in New Jersey answer frequently asked questions about guardianship.

Is legal guardianship necessary? 

This legal appointment is important for several reasons, most importantly to help a senior loved one to maintain a good quality of life. Financial decisions such as managing investments and paying for home care or nursing are essential, as are decisions about the kind of medical care he or he needs to receive.

Unfortunately, even if your loved one has a spouse who is competent to make these decisions, they cannot legally do so without court ordered guardianship, a Living Will or a Power of Attorney which specifically grants this power to them. This makes this process absolutely essential in cases where a Power of Attorney is not contained in the estate planning documents.

Who should be appointed guardian? 

A guardian should be trustworthy and have your loved one’s interests first in mind above all else. This is because handing over financial, personal and medical control to another person makes your loved one incredibly vulnerable. In New Jersey, the state gives first preference to the spouse of the individual and, if he or she is unable or refuses, then on to an adult child.

How does the guardianship process work? 

This is a complex legal proceeding which generally comprises of the following steps:

  • Filing a complaint in the Superior Court in the county in which the incapacitated individual lives. This must include two separate medical affidavits from physicians who have examined the individual.
  • Filing an assessment of the incapacitated individual’s assets.
  • Attending a court hearing where a judge will oversee the petition to file for guardianship. Here, you will be represented by an attorney who will also have to interview the incapacitated individual and file a report indicating that guardianship is necessary.
  • If guardianship is granted, he or she will have to execute qualification forms and receive letters of guardianship. The guardian may also have to be granted a bond to help ensure against mismanagement of the incapacitated individuals affairs and finances.

Get support and expert knowledge from experienced elder law attorneys

At Sedita, Campisano & Campisano, LLC, we offer compassionate legal support for families and individuals seeking guardianship of a loved one. By working with you each step of the way and representing you and your loved one’s legal rights, we will help deliver a solution which allows you to properly care for your elderly family member. For more information on guardianship, veteran’s benefits, medical directives or other elder law concerns, please contact us today.

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Durable and Non-Durable Power of Attorney

In order to insure your health, peace of mind, and legacy it is crucial that the correct type of Power of Attorney (POA) is established and drawn correctly for your needs. But what is Power of Attorney and how does it play into estate planning? To answer your questions, here’s some guidance from expert New Jersey estate planning attorneys.

What is Power of Attorney?

Power of Attorney is a legal document which empowers a person of the principal’s choosing also known as an “attorney-in-fact” to act on the principal’s behalf in a wide range of financial, legal and medical matters.  In New Jersey, all power of attorney documents require that both the principal and the attorney-in-fact are competent and be of sound mind at the point at which they are executed. Every adult should have a Power of Attorney executed regardless of their health, number of dependents or the assets they own.

Durable Power of Attorney

A Durable POA is typically used to appoint an attorney-in-fact to make healthcare related decisions on behalf of the principal. This type of Power of Attorney goes into effect immediately and ends only upon the death of the principal. This is typically used with elderly individuals preparing for the onset of Alzheimer’s or other debilitating diseases and gives a child broad leverage to manage their affairs even after they become incompetent.

General Power of Attorney

This is the least specific form of POA and gives the appointed person or organization the broadest range of powers to act on your behalf. This kind of POA should be used sparingly due to the wide array of powers it grants. It is only valid while the principle is competent enough to agree to have control relinquished on their behalf. This is the primary difference between a general or nondurable Power of Attorney and a “Durable” Power of attorney.

Speak to your New Jersey estate planning attorney to create a Power of Attorney

At Sedita, Campisano & Campisano, LLC, we will work with you to create a comprehensive, fully customized Power of Attorney as part of your estate plan. We can also assist you with updating your current Power of Attorney documents should you require it. For more information on this and other estate planning documents, including your Last Will and Testament or trusts, please contact us today.

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Is a Living Trust only for the wealthy? Estate planning specialists in New Jersey answer

If you’ve been thinking about creating a Last Will and Testament and investing in estate planning then you’ve probably come across a lot of information on Living Trusts. Despite their association with the rich and elite, Living Trusts are not just for the wealthy according to experienced estate planning attorneys in New Jersey.

What is a Living Trust?

There are many different types of Living Trusts, each suited to different needs. Essentially, it is a legal document that dictates how your assets are to be divided up in the event of your passing. It is active as soon as it is created and only becomes effective after you pass away and your Last Will and Testament enters probate.

What are the benefits of a Living Trust?

The biggest difference between a Living Trust and your Will is that the first option bypasses the often costly, tax-heavy and time-consuming probate process which often lasts longer than nine months, allowing your beneficiaries to access their inheritance, funds and assets immediately.

It is also a very comprehensive document, allowing you to be as specific about the distribution of your assets as you want, as well as choosing legal guardians for your children. Other benefits include:

  • Privacy – Unlike a Will, the contents of a Living Trust are not made public.
  • It can include Durable Power of Attorney – Allowing your named trustee to immediately make financial and medical decisions for you if required.
  • Delay distribution of assets – If you prefer, you can ensure that certain assets are held back from distribution to beneficiaries until a particular time, for example, keeping aside money for your child’s college fund or until he/she reaches a certain age.
  • Keeps your business running – If your business is included in your Living Trust, then its income will stay accessible. If it is in a Will, then income will be inaccessible until the probate process is concluded.
  • It is legal in any state and requires no modification if you move between states (although you may need to modify it in terms of updating assets), which Wills often require.

At Sedita, Campisano & Campisano, LLC, experienced estate planning attorneys can assist you with creating a Living Trust or drawing up other legal documents including Power of Attorney, medical directives and Wills. For more information or to speak to an attorney, please contact us today.

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Second marriage? Here’s how it impacts on your estate planning in New Jersey

Second marriages are a very real possibility for many modern adults and while it represents a second chance at lifelong happiness it does come with some complications regarding estate planning, especially when you have children in the mix. Here are a few important factors to consider from New Jersey estate planning attorneys.

  • A prenuptial agreement – While many couples consider this the norm in their first marriage, it’s even more important for a second marriage. Not only does this agreement establish the division of assets in the event of death or divorce, it also can contain lifestyle clauses which establish financial boundaries before the marriage. For example, financial agreements which determine the extent of support for adult children or dependents where the other spouse may be affected.
  • Creating a trust – Often, married couples choose to create a trust which will ensure their estate avoids costly taxation and their surviving spouse and children are taken care of. This becomes a more complex issue when the surviving spouse remarries and more so when new children become part of the family. Your lawyer will work with you to determine if the new spouse should control the trust in the event of your passing, how it should provide for new siblings and where assets belonging to the previous spouse should be managed. There are also certain ways of increasing the value of the estate to help provide for new children and spouses, including taking out life insurance. Your lawyer will have to assist you with this, as it requires a specific legal procedure to ensure that your estate taxes are minimized.
  • Providing for your new spouse and children – Your spouse may be entering into the marriage alone or with children and you may want to include provisions in your estate plan which guarantee that they are cared for if you pass away. This is very important in the event your spouse has a falling out with your own children or beneficiaries, if they sign a Last Will and Testament which leaves everything to their own dependents or remarries. Creating a trust with a third party trustee will ensure that your wishes are carried out impartially and objectively.
  • Your Last Will and Testament – Inheritance issues can easily affect your loved ones when you have remarried and an updated Will is essential to prevent conflict. Without a Will, New Jersey state law says that half of your assets go to your spouse and the other half is left outright to your children, which isn’t ideal for most families. While your lawyer can work with you to make a more comprehensive Will, there are other option, such as insurance trusts, which present useful alternatives to dividing your assets.

Let our New Jersey estate planning attorneys assist you

Estate planning is a complex procedure made even more so by second marriages, but this shouldn’t make you put it on the backburner. Experienced attorneys at Sedita, Campisano & Campisano, LLC will help you simplify the process and – most importantly – ensure your loved ones are properly cared for. For more advice on this process or to have your estate planning documents developed by our attorneys, please contact us today.

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Why life insurance is such an important part of estate planning

Estate planning is all about securing your assets and finances to help support and protect your loved ones in the event of your passing. Life insurance is another means to the same end, supporting and protecting your loved ones. But is life insurance a necessary part of estate planning? Expert attorneys in New Jersey say: Yes.

Firstly, this is because a life insurance policy increases the size of the estate you’re leaving to your loved ones, directly providing them with more financial protection. It also benefits your loved ones in that many policies cover some or all funeral costs. Further, in the event of an unexpected death, the money can help fulfill any unplanned financial obligations.

Secondly, life insurance usually pays out much more quickly than an inheritance when an individual is named as the beneficiary, helping your family and dependents to continue to meet financial obligations while your estate is settled. Naming your estate as the beneficiary, however, will mean the money goes into the estate itself and will be tied up until probate is concluded.

Thirdly, life insurance policies are highly beneficial to estates that include a business, especially if the business is being left to a family member. This way, you can use your life insurance policy to ensure your heirs benefit more equally from your estate.

And lastly, insurance policy payouts are generally income tax-free, helping your heirs to avoid potentially costly inheritance taxes. In fact, you can also help ensure it does not affect your estate tax as a whole by either ensuring your spouse is the beneficiary, or by making the policy part of a trust known as an irrevocable life insurance trust, which is something an experienced estate planning attorney can assist you with. This is especially important for estates that exceed the limits for both federal and New Jersey estate taxes, which are subject to change from year to year.

An estate planning attorney such as SCC Legal,  can help you set up this trust and name your chosen beneficiaries of the trust – not the policy – and the trust will then purchase your life insurance policy. If you pass away, the trust then becomes the beneficiary of your policy and will receive the money paid out by the insurance company. The beneficiaries of the trust will then receive the payments directly through the trust agreement. This means the proceeds of your policy are not counted as part of your estate and are therefore not subject to estate taxes.

At Sedita, Campisano & Campisano, LLC, we can offer you over 30 years of estate planning experience to give you complete peace of mind. For more information on estate planning in New Jersey, please contact us today.

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Your Estate Planning Guide to Creating, Changing or Revoking Your Will in New Jersey

Creating or changing your Last Will and Testament can seem complicated, but it can be handled easily if done through experienced New Jersey estate planning attorneys. Here’s a guide to understanding the different elements that go into this important legal process.

It is important to remember that a Last Will and Testament isn’t just for the wealthy, it’s for anyone with any assets they would like to pass on to specific people or anyone who would like to ensure their dependents are financially protected. This document also allows your estate to avoid the often lengthy and costly probate process.

Creating a Last Will and Testament

In New Jersey, anyone 18 or older who is of sound mind may create a Last Will and Testament. “Being of sound mind” generally means you have not been declared incompetent in a previous legal proceeding.

The first thing you need to decide is to whom you would like to leave your assets. Some of these choices may be sentimental in nature, where you would like to leave something memorable to someone specific. Other choices are generally centered on giving family and dependents financial protection. It’s important to keep in mind you can also donate to charities and organizations close to your heart.

You will also have to specify an executor of your Will who will be responsible for ensuring your assets are distributed according to your wishes. While this person can also be a beneficiary, it is often recommended that you choose someone independent who has a background in legal and business proceedings and can easily navigate this process.

You can, at any time you would like to, change details of your Will, add dependents or revoke it entirely.

In addition to your Will, it’s important to consider a Living Will (or healthcare proxy) and Power of Attorney. These two documents will ensure your medical care and financial choices are carried out as you wish should you be in a position where you are unable to give consent.

In conclusion, creating a Last Will and Testament gives you peace of mind – and by putting it in the hands of a leading law firm like Sedita, Campisano & Campisano, LLC, you can rest assured that your health, assets and loved ones will be taken care of the way you would like. For more information on setting up or changing your Will, please contact us at the law firm of Sedita, Campisano & Campisano, LLC today.

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Your guide to gifting – advice from New Jersey estate planning attorneys

Gifting, in the context of estate planning is one of the most effective means of reducing estate and inheritance tax, yet many people are unsure of how it all works. As elderly law and estate planning attorneys in New Jersey we can shed some light on the key benefits and features of gifting.

In  New Jersey, gifting has become even more important as it is one of the few states that impose a state estate tax in addition to federal estate taxes on people who live in New Jersey, own property here or are leaving property to an inheritor who is not a close relative.

The annual exclusion gift amount is determined each year by the Internal Revenue service (IRS). In 2015, this amount is $14,000 and it can be given freely to as many family members or friends as you would like without impacting on the lifetime fit exemption. Spouses can also combine this amount into donations of $28,000 per gift per person.

The federal lifetime gift tax exemption is an amount the IRS determines year by year that an individual can leave their inheritors without being subjected to federal estate tax. This year it is set at $5.34 million and, because it is determined on an individual basis without regard to matrimonial status, a husband and wife will each get their own exemption. By tracking this sum, you can make the most of lifetime giving opportunities as well through a dedicated trust by increasing the gifts to the trust until they reach the amount determined by the IRS.

Other ways of utilizing gifting include donations towards medical and dental expenses for friends and family by paying the provider directly. You can also fund section 529 college plans for children and grandchildren. In addition, this money grows in tax-free accounts and can be withdrawn tax-free as well, providing it is used to fund specific educational and vocational expenses.

It’s important to track your gifting carefully before you commit to any transfers, as exceeding the basic federal exclusion amount/federal lifetime gift tax exemption could mean that your estate ends up owing as much as 40% in taxes.

Knowing exactly when and where to distribute your assets is key to effective gifting – and a comprehensive estate plan managed by experienced attorneys will ensure you are kept up-to-date and in line with state and federal tax regulations. At Sedita, Campisano & Campisano, LLC, we can offer you over 30 years of estate planning experience to give you and your family the best possible results. For more information on estate planning in New Jersey, please contact us today.

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Moving states? Here’s how it affects your estate planning

Moving to a different state isn’t just about a change of lifestyle – it also has far-reaching effects on your estate plan. While wills and living trusts should be valid across all states, the laws of each particular state can change particular aspects of estate planning. It’s important to update these documents as soon as you are able, as these differences can significantly change what you would like to achieve in terms of deciding inheritance, reducing taxes and even managing your medical directives.

Estate planning and moving to New Jersey 

New Jersey is an equitable distribution state rather than a community of property state, which does affect estate planning with regards to particular processes such as divorce. Rather than splitting assets 50-50, assets will be evaluated and distributed in a manner seen as fair, but not necessarily equal. If you are moving from somewhere in a community of property state, it is important this change is addressed.

New Jersey also has its own additional estate tax which varies year by year. This year you will qualify for the state tax if the gross value of your estate exceeds $675,000. You will also qualify for the federal tax if the gross value of your estate exceeds $5,340,000. This gross value is inclusive of assets such as property, life insurance, IRA’s, bank accounts and investments so you can exceed the state exemption amount and pay around 10% of the estate value in tax. For people looking to keep as many of their assets as possible to support their family after their passing, it’s important you speak to an estate planning lawyer about implementing a trust that will significantly reduce estate taxes.

If you have an advanced health directive or want to create one, it’s important you speak to an attorney who can walk you through the legal allowances and restrictions set down by the state of New Jersey. This will guarantee your wishes are maintained rather than impeded by legal technicalities. For example, New Jersey state law allows you to create two types of advanced directives, the first being an instructive directive for the medical care and measures you would like to receive and the second a proxy directive which allows a specific person to make decisions on your behalf if you are unable.

In essence, reviewing your estate planning documentation is about guaranteeing your original wishes are adhered to as far as the laws of the state will allow. It insures your documentation is in order and that costly and time-consuming legal technicalities are avoided.

For more information on estate planning and New Jersey estate law or to book an appointment at Sedita, Campisano & Campisano, LLC, please contact us today.

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Estate planning tips: When is the right time to pass your property on to your children?

For many parents, passing their home and property on to their children is an important part of providing for them, especially if they can do so while still alive. After all, you can live in your home, provide your children with a paid-off asset and reduce inheritance taxes all at the same time. However, according to New Jersey estate planning attorneys, this is not without risks:

  • Medicaid: Medicaid provides financial assistance to help pay for long term care, something which costs on average $70,000 a year, with most people requiring at least two years of care. While transferring your assets can provide you with some Medicaid asset protection, it can also increase your risk of being refused aid. That’s because this program has a five-year-look-back period in which they include gifted assets in your evaluation. This means you may be ineligible for Medicaid when you need it most.
  • Security: Putting a significant asset like your home in the hands of others does put you at risk of losing the asset entirely. For example, if your child gets divorced and his or her ex-spouse has a claim on the property it could be lost or cost you significantly in divorce proceedings. Similarly, should your child gets into debt, the property may be used as collateral to settle, leaving you homeless.
  • Conflict: Inheritance can cause conflict in the best situations and leaving property to children is no different. This is a very valuable asset and, especially if you have more than one child, this inheritance can cause contention about who deserves the property, who needs it more, whether it should be sold or not and so on.

Estate planning attorneys can give you options to provide for yourselves – and your children

Fortunately, transferring your property to your children is not the only option for achieving your estate planning goals. Utilizing the expertise of an attorney will ensure you draw up a solution which meets your needs and provides for your children the best way possible. This may take the form of a more specific Last Will and Testament which divides your assets fairly and avoids lengthy probate, a Living Trust where an executor will ensure fair division and use of assets, or an estate plan which ensures you have maximum Medicaid asset protection and preserves your assets for your children.

For more information on our estate planning services or to draw up comprehensive estate planning documents, please contact us to book a consultation with Frank R. Campisano today.

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