By Ellen G. Makofsky Esq.
COVID-19 has disrupted the court system; it was shut down for weeks on end resulting in significant delays to many important pending legal matters.
Critical court matters such as probate and administration proceedings of decedents came to a complete halt for a long period of time. This means that executors and administrators did not receive the Letters Testamentary or Letters of Administration that they needed to proceed with accessing a decedent’s assets to pay estate bills and keep loved ones afloat; there were extreme delays in having guardians named for minor and/or disabled heirs; and estates were unable to be settled.
Even though courts have reopened, there are ongoing staffing shortages and the courts are bogged down with a backload of cases as well as dealing with the implementation of brand-new procedures for moving legal matters forward. This is a daunting task and we can only expect to see the courts become more increasingly backlogged.
In Nassau County, for a non-complicated estate, it is currently not unusual to wait at least 8-10 weeks before receiving Letters Testamentary or Letters of Administration, leaving the executor or administrator with no ability to sell real estate, manage stock portfolios, pay creditors or to resolve other estate issues during the waiting period.
All of this delay is occurring in a period of economic volatility and rising mortgage rates which is creating much anxiety for executors, administrators and beneficiaries.
A revocable trust is an estate planning tool that can provide for a seamless transition of assets upon your death while alleviating your loved ones from ever having to step a foot in the courthouse. A revocable trust can achieve many goals such as keeping one’s affairs private and allowing for the individual establishing the trust (often referred to as the “Grantor” or “Settlor”) to maintain control over his or her assets during life while also providing for asset management upon incapacity or death.
But one of the most important features of a fully funded revocable trust is that it permits assets titled in the name of the trust to pass seamlessly to the named beneficiaries of the trust upon the death of the grantor, without any court involvement.
Unlike a last will and testament which requires a court proceeding to have an executor appointed and to be able to gain access to a decedent’s assets, a revocable trust provides for trust assets to be available immediately following the death of the grantor and it does not require any court approval.
Revocable trusts are not for everyone. At the death of the grantor, a revocable trust can only transfer to heirs those assets which are owned by the trust.
What this means is that in order to be an effective substitute for a Will, the Grantor must transfer his or her assets into the trust during life. New deeds for real property need to be prepared and filed with the County Clerk and the title to bank accounts and brokerage accounts need to be changed to reflect trust ownership.
Any asset not retitled into the trust by the grantor that lacks a beneficiary requires a probate or estate administration, even though the deceased person created a revocable trust. Depending upon the type of assets an individual owns, transferring all assets into a trust can be complicated.
Every person’s estate plan contains different issues. Each one of us is unique and solutions need to be customized to an individual’s needs. As we all look forward to life going back to “normal”, now is a good time to plan in order to protect our families and assets. While we cannot control events like a global pandemic, we can leave a plan in place that saves our loved ones from unnecessary stress.
Ellen G. Makofsky, Esq., Makofsky Law Group, P.C., 600 Old Country Rd., STE 444, Garden City, NY 11530 [email protected]