Continued from last week…

When the debts of an estate are uncertain, an executor AKA Personal Representative may apply with the Surrogate for an Order Limiting Creditors. This order is simply a notice to creditors that they are to present to the fiduciary within 6 months of the date of the order their claims in writing, under oath, specifying the amount claimed by them and the particulars of the claim. This enables the fiduciary to determine within a reasonable length of time whether the estate is solvent. It also assists the fiduciary in settling the estate without any undue delay. If an Order Limiting Creditors has been filed and the claim of a creditor is not presented within 6 months, then the fiduciary can distribute assets and not be liable to any creditor who has presented a claim. If a claim is presented to a fiduciary, it need not be accepted. The fiduciary has 3 months in which to dispute the claim. If the claim is disputed, then the claimant must commence an action on the claim within 3 months after receiving the notice of dispute. If the creditor does not commence an action within that time, the fiduciary would not be liable to him/her with respect to assets delivered or paid over before the commencement of any action.

After the Will has been entered into Probate, the executor must within 60 days of the date of the probate do Notice of Probate (R.4:80-6) to all beneficiaries under the Will and to all persons who would have inherited by intestacy (those next of kin listed on the Application For Probate). The notice in writing will state that the Will has been probated, the place and date of probate, the name and address of the executor and a statement that a copy of the Will shall be furnished upon request. A proof of mailing must be filed with the Surrogate within ten days thereof. If the names and addresses of any of those persons are not known, or cannot by reasonable inquiry be determined, then a Notice of Probate of the Will must be published in a newspaper of general circulation in the county naming or identifying those persons as having a possible interest in the probate estate. If by the terms of the Will property is devolved to a present or future charitable use or purpose, like notice and a copy of the Will must be mailed to the Attorney General of the State of New Jersey.

The executor AKA Personal Representative is required to pay the debts of the decedent and any taxes due, to perform a Child Support Judgment search on each beneficiary, to make distribution to the beneficiaries, and if required, to provide an accounting of his/her administration of the estate. An informal accounting may be requested by only the next-of-kin given on the Application for Probate or beneficiaries named under the Will and should not be requested until one year from date of probate. If the executor AKA Personal Representative refuses to comply with the request, an action may be brought in the Superior Court Probate Part for a formal accounting.

A Surrogate will deny probate of a Will if the Will was not properly executed or the witnesses cannot be located and proper execution cannot be proven.

The Surrogate may not act when (1) a caveat is filed before entry of the judgment (2) a doubt arises on the face of the Will or a copy of the Will is presented (3) a non-resident’s Will is offered for probate and has no assets in that county (4) the Surrogate certifies the case to be one of doubt or difficulty; or (4) a dispute arises as to any matter.

If, after a Will has been probated, another Will of a later date is found or if, after letters of administration have been granted, the existence of a Will is discovered, a Complaint and Order To Show Cause must be filed with the Superior Court- Probate Part. If on the return date, any person in interest contests the admission to probate of the after-discovered Will, the procedure followed is that of any other Will contest. If no contest is lodged, the later Will is proven before the Court. The estate will then be administered and distributed according to the terms of the after-discovered Will.

It should be noted that all papers that are filed with the Superior Court-Probate Part are filed with the Surrogate who is Deputy Clerk of that Court.

Succeeding executor occurs when a prior executor who had qualified has died.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.

Continued from last week…

The probate process is initiated with the presenting of the original Will together with the original death certificate to the Surrogate by the executor. If the purported Will is adjudicated to be valid then the Application for Probate, an Authorization To Accept Service of Process and an Executor Qualification are prepared by the Surrogate.

The executor AKA Personal Representative will sign the Application for Probate in which he/she has asked the Surrogate to pass on the validity of the Will and to file it with the Superior Court. This application contains information on the executor and the next of kin. The next of kin given must be of the same degree of kinship had the decedent died intestate. This allows for any of the listed next of kin to contest the probate if cause arises even if not a named beneficiary in the Will.

Before an executor can perform his/her duties, an Authorization To Accept Service of Process (Power of Attorney) must be executed in favor of the Surrogate empowering the Surrogate to accept service of process in any cause in which the fiduciary, in his/her capacity as such, is a party. If someone sues the estate and personal service cannot be effected, service of process may be made upon the Surrogate. The Surrogate must mail a copy of the process to the fiduciary at the address on the Authorization.

The executor must sign the Executor Qualification that he will administer the estate according to law.

Under N.J.S.A. 3B:3-4 a Will prepared after 1978 should be “self-proved”. This meaning that there is certain language at the end of the Will in which the testator and two witnesses attest that the instrument is a Last Will and Testament, the testator is over 18 years of age, of sound mind and under no undue constraint in signing this instrument. An Attorney at Law or Notary Public must swear and subscribe to this. A Will properly self-proved may be admitted to probate without further proof of proper execution.

When a Will is not “self-proved” one of the witnesses must appear before the Surrogate to execute a Proof of Witness. If the witness to the Will is outside the county or the state at the time of probate, proof of the execution of the Will must be submitted on the deposition of the witness. At the time of application, the Surrogate will order a commission to another Surrogate (in state) or notary public (out of state) to take oath in the jurisdiction where the deposition is to be taken of the witness to the Will. A copy of the Will with an Order signed by the Surrogate requesting the deposition of the witness and the Proof of Witness form are sent to the person commissioned. The deposition of the witness is then taken under oath and certified by the person commissioned. The Proof of Witness is returned to the Surrogate.

In the case where both witnesses are deceased and the Will is not “self-proved” the signatures of both the witnesses and the Testator must be proved. One person may prove the signature of both witnesses.

When the Will is properly proven the Surrogate will enter a Judgment Admitting Will To Probate and issue Letters Testamentary which certifies the Will and is the authorization for the executor AKA Personal Representative to act on behalf of the estate.

The Surrogate will also issue an Executor Short Certificate which the executor AKA Personal Representative uses as proof of his/her authority to transfer or sell assets of the deceased. The number of short certificates needed will depend upon the number of institutions or agencies in which an asset needs to be dealt with for transferring the asset to the estate.

Stay tuned next week for Article III of The Probate Process In New Jersey.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.

The Probate Process In New Jersey – Article 1

Before the probate procedure is initiated it is necessary to determine whether there is a need to probate the Will. A Will does not need to be entered into probate if there are no assets in the decedent’s name solely.

If the decedent has assets in his/her name alone then the Will must be probated regardless of the value of the estate. You probate in order to nominate an executor AKA Personal Represenative who is given the authority to transfer the assets both real and personal to the estate.

It is necessary at the outset to ascertain certain information in order to probate the Will.

1. Check the death certificate to determine which Surrogate’s Court the probate will be entered. The probate must be done in the county where the decedent resided.

2. Check the Will to be sure that it is the original Will, not a conformed copy. Only an original may be entered into probate.

3. Determine who the named executor AKA Personal Represenative is in the Will and whether he/she will qualify.

4. Check to see if the Will is “self-proved” N.J.S.A. 3B:3-4. If not, a witness needs to be located to execute a Proof of Witness. .

5. List all the assets of the decedent in order to determine the number of short certificates that will be requested.

6. List all next of kin with names, addresses and ages, if minors. If there are any deceased next-of-kin then their issue must be named.

The probate of a Will can not occur until the eleventh day from the date of death. The procedure may be initiated in the Surrogate’s Court earlier but the issuance of short certificates will not occur until the eleventh day. This ten day period allows for the filing of a caveat by the proper degree of kinship or beneficiary in a prior last Will. 

Stay tuned next week for Article II of The Probate Process In New Jersey.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.

If you have individual bank accounts and fail to make a Will, your accounts, along with the other assets in your estate, will go through a probate process after your demise. If you want to prevent your bank accounts from going through a probate, you can choose to convert your individual accounts into joint accounts.

Using Joint Account to Avoid Probate

In a joint account, you can simply name your loved one as the joint owner of that account. After your death, the ownership of assets in the account is transferred to the joint account holder, without the need for an order from a probate judge.

If you have named more than one joint holder of your account, the bank would simply remove your name from the list of owners of the account, after your death.

There are, however a few disadvantages of using this method:

• If you add a person’s name to your account and that person does not make any contribution, then your portion of the account, when transferred to the name of the joint holder at the time of your death, is considered as a gift. If the value of this gift is higher than the maximum amount excluded from gift tax, your beneficiary will need to report the gift to the IRS.
• If you have added more than one name to your account, and if any one of the joint owners faces a lawsuit, the entire funds in the joint account could be at risk.
• If you have named a minor as the joint holder of your account, the account will be handled by a guardian or conservator, who will be constantly supervised by a court so that the minor’s interests are taken care of.
• The joint owner of your account can start using the money even in your lifetime, which may not be acceptable to you.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.

When someone passes away, their property must be distributed to their heirs. There are a few different ways to do this, two of which (Will and dying intestate) require your property to go through the courts. This is known as probate.

Now, because probate is handled on a state by state basis, any property held outside the state of residence will require a separate probate hearing, known as Ancillary Probate. The type of property that can go into ancillary probate includes real estate, as well as any other tangible property located and registered in another state.

It’s not uncommon for example, to own a vacation home or rental property in another state. Many people also own other property as well, including automobiles, boats and even just raw land. Because of this, ancillary probate is becoming much more common and unless you have taken steps to avoid this secondary probate, your loved ones will face not one but two probate hearings when you pass away .

The action you take to protect your out of state property will depend a lot on your particular situation, and who it is that you want to receive this property. To avoid ancillary probate with your out of state property there are some steps you can take.

Married Couples – People that are married can easily avoid ancillary probate by simply ensuring that the property is deeded to both spouses. One spouse will inherit the property by right of survivorship. The main problem with this is that if both spouses were to die at the same time in an accident, the property would then go into ancillary probate. This is also true in the case where the surviving spouse passes away at a later time, unless an estate plan has been put into place to prevent this from happening.

Joint Deed With Other Beneficiaries – Another approach to keeping your out of state property out of ancillary probate is to add the beneficiary of your choice to the deed, along with yourself, but keep in mind that it may also be necessary to include right of survivorship with the deed. This is the approach you would take if you are not married, or if you want someone to inherit the property other than your spouse, but there are several problems to this approach. One is that you may lose some tax benefits by adding someone else to the deed, plus if that person were to become involved in a lawsuit, a lean could be put against the property.

The Revocable Living Trust – No matter what your personal situation is, in most cases the easiest way to ensure that your out of state property does not go into ancillary probate is to deed it to your Revocable Living Trust. With this type of trust your property can go directly from the trust to your chosen beneficiaries, without the problems of going through ancillary probate.

If you own property outside of your home state, estate planning is essential to ensure that your heirs receive your property after you die. By far the best choice to ensure that your property goes directly to your chosen heirs is through an estate plan that includes a Revocable Living Trust.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.

If you’re just getting started in the estate planning process, you may be wondering what all the lingo means. Like any legal field, estate planning has a number of terms that help define the players in the estate planning process. Understanding those terms will help you create a plan that’s right for you.

Here are some basic terms relating to Estate Planning:

Probate – This is the legal process that oversees the settlement of an Estate after the owner’s death. The Probate process includes payments to creditors, payments of taxes, protection of assets to be given to beneficiaries and the like. There are ways to minimize those taxes and even avoid probate altogether. Talk to your estate planning attorney to discuss your options.

Beneficiaries – These are the people who will inherit your assets and belongings – whether it’s a big financial gift or the family scrapbook – after your death.

Fiduciaries – These are the people you name in your Will who would be responsible for handling various aspects of your Probate process. For example, a fiduciary would be responsible for seeing that benefits of a particular bank account go to your minor children after you pass on.

Will – A Will is a legally binding document that details how your estate should be distributed after you die. A Will is considered a key component of your Estate Plan.

Trustees – Like a Will, a trust can distribute your assets after you pass but it also offers several benefits that a Will does not. A trust can keep your estate out of probate, it can minimize the taxes your heirs would have to pay and it can also allow you to set up incentives and encourage personal growth among your heirs. The person you appoint to oversee your trust is called a Trustee. Trustees are often family members but they can also be an attorney, a bank or similar institution.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.

When a person dies, the total value of his estate is assessed and then distributed according to the Will of the deceased. If there are creditors to be paid or taxes owed, the estate must handle that as well. To ensure all of these things occur, the court will oversee a process known as probate.

As an Estate owner, it is your duty to name someone in your Will to handle these affairs for you. If you don’t, the court will appoint someone for you, and that may not be the person you would choose.

The Probate process includes the following steps:

1 – The Court appoints a personal representative, executor or administrator to look after the Probate process.

2 – The representative is responsible for locating, listing and protecting the assets of the decedent.

3 – The representative has to list the value of the entire Estate and all the assets.

4 – All known creditors are located and informed that the decedent is no more. Notices might be published in the newspaper to inform any unknown creditors. ( Although, in NJ this is no longer required).

5 – All the decedent’s bills are cleared and taxes paid. Taxes to be paid may include the Income Tax, the Estate Tax, the Inheritance Tax etc.

6 – A need might arise to sell some of the assets to clear all these bills and taxes. The representative will have to take care of all these problems.

7 – The remaining assets would be distributed to the beneficiaries. All disputes will also have to be resolved if the beneficiaries raise objections. The distribution of assets to beneficiaries is based on the Will of the decedent.

If you have been named as the executor of someone’s estate, a qualified estate planning attorney can help guide you through the entire probate process. Likewise, if you’re wondering how best to construct your Will and estate plan, an attorney can help you with these matters as well.

The Bonfrisco Law Firm is a member of the American Academy of Estate Planning Attorneys.