Wills, Trusts, & The Estate Planning Process in New York

Posted On January 2, 2024

Estate planning involves preparing and strategically organizing your assets for their orderly distribution. It encompasses all your possessions, including tangible assets, intellectual property, investments, automobiles, business interests, real estate, and more.

The role of an estate planning lawyer is crucial in minimizing uncertainties related to estate management while maximizing the value retained for your heirs. This includes reducing potential taxes, legal fees, and other expenses that could diminish the estate’s value.

Engaging in proactive estate management offers numerous benefits. Understanding the difference between trusts and wills, which are essential estate planning tools, can provide security and advantages for you and your family, safeguarding the value of your estate. At New York Legacy Lawyers, our team of New York estate planning lawyers can assist you in this process, helping to protect your assets and fulfill your wishes.

Contact us today at (718) 713-8080 to schedule a consultation.

What is Estate Planning?

Estate planning is the process of organizing and managing your assets while you’re alive and ensuring their efficient distribution according to your wishes after your death. It’s a comprehensive process that involves drafting legal documents, such as wills and trusts, and devising strategies to minimize estate taxes and avoid probate.

At its core, estate planning serves two important purposes. First, it helps distribute your assets to your chosen beneficiaries according to your wishes. This could involve passing property to family members, making charitable donations, or arranging any other form of asset distribution that reflects your intentions.

It also provides an opportunity to strategize around New York’s estate tax laws. With careful planning, you can legally reduce the estate tax burden and maximize the inheritance left for your heirs.

Estate planning also encompasses other considerations, such as appointing guardianship for minor children, designating healthcare proxies to make medical decisions on your behalf if you’re incapacitated, and assigning power of attorney to handle your financial affairs.

In New York, estate planning is governed by state-specific laws, making it advisable to consult an experienced estate planning attorney. They can guide you through New York’s estate laws and ensure your estate plan fulfills your wishes and optimizes your financial legacy.

Estate Planning with Wills

Most people know about wills and their basic purpose – distributing one’s hard-earned assets to the intended beneficiaries after passing away. However, wills can be used for a lot more. A will can be an important tool for anyone to have, regardless of personal wealth or the number of assets owned.

Here’s a list of some of the very valuable things a will can do: 

  • List who gets what. The most common purpose for a will is to name which individual, or group of individuals, will receive particular property belonging to a person when he or she passes away.
  • Name guardians for children. Typically, a will can state the parent’s preferences for their child or children’s guardian in the event of the parent’s incapacity or death. The will also usually contains at least one alternate in the event the first choice cannot serve as a guardian. 
  • Establish trusts. In many cases, a person may not want a child or loved one to receive all of the property that they are inheriting at once. Or a person may want the beneficiary to be able to use the property for a while, and then for it to pass on to someone else. In that situation, an individual may choose to use a trust. A trust holds property on someone else’s behalf. Trusts are commonly established for minor children so that someone else can manage the children’s money until they reach a certain age when their parents believe they will be able to manage it. Trusts are also commonly used in second marriage situations – a person may want to allow a spouse to have access to certain property while the spouse is living, but for that property to ultimately pass to the decedent’s children. Trusts can help accomplish that goal.
  • List funeral wishes. Although this can be done in other documents, too, a will commonly states whether an individual wants to be buried or cremated, and where the body should be buried or the ashes should be spread. Sometimes, wills contain other information about funeral wishes, like where it should take place and even what readings might be recited.
  • Tax planning. Wills can be great tools for tax planning in order to avoid federal or state estate or inheritance taxes. This can sometimes be accomplished by setting up various trusts.
  • Naming executors and trustees. A will usually states who will be the executor of an estate, which is the person who will carry out a deceased individual’s wishes listed in the will. Wills can also name the trustee of any trusts established in a will, which is the person who will be in charge of carrying out the instructions of the trusts.

While wills can serve as powerful estate planning tools, they are only effective if they are properly drafted to suit the needs of each individual. Whatever stage of life you find yourself in,  our New York estate planning lawyers can review all available options with you and establish a will that reflects your wishes. Contact New York Legacy Lawyers today to schedule a consultation.

Estate Planning Starts with a Last Will & Testament

A Last Will and Testament is one of the most well-known components of any estate plan. This legal document determines who will inherit your property after your passing. It provides a clear framework for distributing your assets according to your wishes, honoring your intentions and helping to avoid potential disputes among beneficiaries.

Beyond asset distribution, a will allows you to name guardians for your children, providing security and clarity about their care if something happens to you. Without a will, these critical decisions may be left to the courts, potentially resulting in outcomes that do not align with your preferences, such as temporary foster care. A well-crafted will offers peace of mind, protecting both your loved ones and your legacy.

When drafting a will, you will also need to think about your will’s executor. This individual will be responsible for overseeing the process of carrying out your will and managing the probate process to ensure your wishes are fulfilled.

Why Is It Important to Name an Executor in a Will?

Naming an executor in a will plays a vital role in ensuring the proper management of your estate after your passing. The executor carries out the terms of the will, managing the estate’s affairs and handling essential tasks.

Responsibilities of an executor include overseeing the probate process, a legal procedure to validate the will. They gather individually owned assets, address any outstanding debts and taxes, and distribute the remaining estate as directed in the will. Debts may involve expenses such as funeral costs, while taxes could include final income taxes or estate taxes.

Without a designated executor, the estate could face delays, higher legal expenses, and potential disputes among heirs or beneficiaries. The executor also manages and protects the estate’s assets during the administration period, which can vary in duration. This management is crucial for estates with complex assets or those that generate income.

Executors are tasked with fulfilling any pledges or agreements you made during your lifetime. In cases of uncertainty, they may need to seek court guidance. Once all financial matters are settled, the executor distributes the remaining assets to beneficiaries according to the will and provides a comprehensive accounting of their actions.

Naming an executor ensures the smooth administration of your estate, fulfillment of obligations, and distribution of assets according to your wishes. This step is essential for creating a clear and effective will that minimizes complications for your loved ones.

What Are the Disadvantages of Having a Will?

While creating a will is a fundamental aspect of estate planning, it comes with certain drawbacks that should be considered. One significant disadvantage is that a will becomes a public record once it goes through probate. This public accessibility can be a concern for those who value privacy regarding their personal financial matters and beneficiary details.

Another downside is the probate process itself, which a will must undergo. Probate can be both time-consuming and expensive. It involves court supervision, and the process can extend over several months, or even longer if there are disputes among beneficiaries or claims against the estate. This duration not only delays the distribution of assets to the beneficiaries but can also deplete the estate’s funds through various legal and court fees.

Furthermore, a will only takes effect upon death, meaning it does not provide instructions for situations where an individual might become incapacitated. Therefore, additional arrangements, such as a power of attorney, are necessary to address all potential issues comprehensively.

Understanding these disadvantages is crucial for comprehensive estate planning. While a will is essential, considering its limitations can help you make more informed decisions. If you have questions or need assistance with your estate planning, consult a New York estate planning attorney to ensure your wishes are fully protected. Contact New York Legacy Lawyers today to schedule a consultation.

You Can Also Create a Trust

Another way to protect your assets in your estate plan is through a trust. A trust is a tool in which you place selected assets into. When you pass away or depending to the terms of the trust, the trustee (the person you nominated who has the authority to manage your trust) will distribute your property according to your directions.

Here’s why trusts are so valuable to your estate planning: Trust assets do not have to pass through the probate process for the property to be transferred to the people you love.  By skipping probate, you avoid a public court process. Where a will becomes a public document, open for others to look through, and even fight over, the assets and contents of a trust are more confidential. A well-crafted trust can save your family thousands in probate fees and potential legal costs from infighting. 

In New York, various types of trusts serve distinct purposes in estate planning. Below are brief definitions of some common trusts:

  • Trusts for Minors: These trusts hold assets for beneficiaries under the age of 18, managing and distributing funds until they reach adulthood. This arrangement ensures that minors receive financial support in a controlled manner.
  • Special Needs Trusts: Designed to provide for individuals with disabilities without affecting their eligibility for government benefits, these trusts cover expenses not met by public assistance programs. They help maintain the beneficiary’s quality of life while preserving access to essential services.
  • Marital Trusts: Also known as “A” trusts, marital trusts benefit a surviving spouse by providing income for life, with the principal passing to other beneficiaries upon the spouse’s death. This structure can offer tax advantages and ensure financial security for the surviving spouse.
  • Revocable Living Trusts: These trusts allow the grantor to retain control over assets during their lifetime, with the flexibility to modify or revoke the trust as circumstances change. Upon the grantor’s death, the assets are distributed to beneficiaries, often bypassing the probate process.
  • Irrevocable Life Insurance Trusts (ILITs): An ILIT owns a life insurance policy, removing it from the grantor’s taxable estate. This arrangement can reduce estate taxes and provide liquidity to cover expenses or debts after the grantor’s death.
  • Spendthrift Trusts: These trusts protect beneficiaries who may be prone to mismanaging funds by restricting their access to the trust principal. A trustee manages distributions, safeguarding the assets from creditors and the beneficiary’s potential financial irresponsibility.

Each trust type serves specific goals and offers unique benefits, making it essential to choose the appropriate structure based on individual circumstances and objectives.

What Assets Cannot be Placed in a Trust?

When establishing a living trust, it is crucial to carefully evaluate which assets are appropriate for inclusion. Not all assets are suitable for transfer into a living trust, as they may have specific legal and financial considerations.

There are certain types of assets that are generally not recommended for placement in a living trust. Here are a few examples:

Retirement accounts: Assets like 401(k), IRA, 403(b), and certain qualified annuities should not be transferred directly into a living trust. Transferring these assets may result in income tax obligations since they require withdrawal. However, you can designate the living trust as a beneficiary to facilitate the smooth transfer of funds upon your passing.

Health savings accounts or medical savings accounts: These accounts are designed for tax-free utilization on eligible medical expenses and cannot be transferred to a living trust. Similar to retirement accounts, you can designate the trust as a primary or secondary beneficiary.

Active financial accounts: Unless you are the trustee with complete control over trust assets, it is generally advisable to keep accounts used for monthly bill payments separate from the trust. This is because individuals may have concerns about potential delays in probate and the inability to quickly distribute these funds to heirs. Instead, you can designate beneficiaries for these accounts using options like payable-on-death (POD).

UGMA/UTMA accounts: If the trustee were to pass away before the minor, a trust might be subjected to probate. In such cases, it is advisable to consider appointing a successor custodian for these accounts.


Vehicles: Generally, everyday vehicles such as cars, boats, trucks, motorcycles, airplanes, mules, or snowmobiles are not typically included in a living trust. These assets often bypass the probate process, and unlike collectible vehicles, they do not appreciate in value. Additionally, some states impose taxes during the retitling of vehicles, and certain states do not permit vehicle owners to name beneficiaries after their demise.

Assets that Cannot be Placed in a Trust Details
Retirement accounts Assets like 401(k), IRA, 403(b), and certain annuities should not be transferred directly to a living trust due to potential tax obligations.
Health savings accounts or medical savings accounts Tax-advantaged accounts designed for medical expenses cannot be placed in a living trust. Designate the trust as a beneficiary instead.
Active financial accounts Keep monthly bill payment accounts separate from the trust. Use beneficiary designations like payable-on-death (POD) for these accounts.
UGMA/UTMA accounts Consider appointing a successor custodian for these accounts to avoid probate if the trustee passes away before the minor beneficiary.
Vehicles Everyday vehicles like cars, boats, and motorcycles are typically excluded from living trusts. They bypass probate and don’t appreciate.

Get Help with a Will, Trust, Or Both!

Wills and trusts are valuable tools for creating a comprehensive estate plan, but they can involve intricate details. If you’re planning for your own future, and for the future of your family, consulting an experienced New York estate planning lawyer can provide the guidance needed to make informed decisions.

New York Legacy Lawyers can assist in creating a customized estate plan that meets your needs. Contact us today at (718)713-8080 to schedule a consultation and take the next step in securing your family’s future.