Estate planning that actually works when it is needed

An estate plan is not a stack of documents. It is a set of decisions about what you own, who should have it, who should be in charge, and what happens if you cannot make decisions yourself — and then the follow-through that makes those decisions operative.

The firm’s planning work starts with what already exists: the recorded deed, the beneficiary designation forms, the accounts and how each is titled, any prior will or trust. That review very often finds the real issue, which is frequently not the one that prompted the call. Unfunded trusts, beneficiary forms naming a former spouse, a house that was deeded to a child years ago, a power of attorney no bank will accept — these are the problems that quietly defeat plans.

Below is what the estate planning practice covers. If you are dealing with long-term care or Medicaid, start with elder law and Medicaid planning. If someone has already died, start with probate and estate administration.

Wills

A will directs who receives the property that passes through your estate, names the executor who will carry that out, and — for parents of minor children — nominates a guardian. In New York a will has formal execution requirements, and a will that is not properly executed and witnessed may fail entirely.

What a will does not do is often more important than what it does. A will has no effect during your lifetime; it cannot authorize anyone to act for you if you lose capacity. It does not control assets that pass by beneficiary designation or by operation of law — retirement accounts, life insurance, transfer-on-death arrangements and jointly held property with rights of survivorship all pass outside the will. And a will does not avoid Surrogate’s Court; it is the document that gets filed there.

The firm reviews a proposed will against the actual titling of your assets, because the most common defect in a will is not a drafting error. It is a will that carefully divides assets that will never pass under it.

Points that deserve attention

• Naming an executor who is willing, capable and likely to outlive you, plus a successor
• What happens if a beneficiary dies first — per stirpes versus per capita
• Specific bequests of property that may not exist at death
• Whether a testamentary trust is needed for a minor, a beneficiary with creditor exposure or a beneficiary receiving public benefits
• Coordination with the spousal elective share, particularly in second marriages
• Where the original signed will is kept, and who knows

Revocable living trusts

A revocable living trust holds title to assets during your lifetime, with you typically serving as your own trustee, and directs where those assets go at death without a Surrogate’s Court proceeding. Because it is revocable, you can amend or revoke it and you retain full control.

That control is also its limit. Because you can take the assets back, a revocable trust generally does not protect assets from your own creditors and generally does not shelter assets for Medicaid purposes. Revocable trusts are about administration, privacy and continuity — not asset protection.

When a revocable trust tends to earn its cost

• Real property in another state. Property in Florida, North Carolina or anywhere outside New York would otherwise require a separate ancillary probate in that state. A properly funded trust generally avoids it.
• Privacy. A probated will becomes a public court record. A trust generally does not.
• Continuity through incapacity. A successor trustee can step in without a guardianship proceeding.
• Anticipated conflict. Where a contest is likely, trust administration can be a less exposed posture than a will offered for probate.
• Blended families and staged distributions. Where money should not simply land in a beneficiary’s hands on a given date.

Irrevocable trusts and asset protection

An irrevocable trust involves a genuine transfer. Assets placed into it are no longer yours in the same way, the terms generally cannot be freely rewritten, and you give up a meaningful degree of control. In exchange, the transfer may — depending on the type of trust, its terms and the timing — place assets outside the reach of certain future claims and outside the count for certain benefit programs.

Irrevocable trusts are not one thing. They are a family of tools with different purposes: long-term-care planning, estate tax reduction, life insurance ownership, gifting to descendants, protecting an inheritance for a beneficiary. The right question is never “should I have an irrevocable trust,” it is “what am I trying to place beyond reach, from whom, and what am I prepared to give up to do it.”

What you actually surrender

• The ability to freely revoke or rewrite the trust, subject to any consent mechanisms built in
• Typically, access to the principal — income is often retained, principal generally is not if long-term-care planning is the goal
• Direct control over trust assets, which pass to a trustee other than yourself in most protective designs

Because a transfer to an irrevocable trust may be treated as a gift with consequences under Medicaid transfer rules, timing matters a great deal. See elder law and Medicaid planning for how the lookback interacts with these transfers.

Powers of attorney, health care proxies and living wills

These are the documents that matter while you are alive, and they are the ones families most often discover are missing or defective at the worst moment.

Power of attorney

A power of attorney lets an agent act on your behalf in financial and legal matters. New York substantially revised its statutory short form power of attorney, and older forms — particularly ones executed decades ago — are sometimes questioned or refused by banks and title companies even when they remain legally effective. A power of attorney also terminates at death, which surprises families who assume the agent can keep paying bills afterward.

The gifting authority in a New York power of attorney deserves particular attention. Without appropriately drafted gifting powers, an agent may be unable to carry out the transfers a long-term-care plan depends on — exactly when the principal can no longer sign for themselves.

Health care proxy

A health care proxy names the person who makes medical decisions if you cannot. It is a different document with a different agent from the financial power of attorney, and both are needed.

Living will

A living will records your wishes about end-of-life treatment. New York does not have a living will statute in the way some states do, but a clearly expressed written statement of wishes carries weight and gives your health care agent guidance and cover.

Trust funding and asset titling

This is the step that gets skipped, and it is the reason well-drafted plans fail.

Signing a trust creates an empty container. Until assets are actually transferred into it, the trust controls nothing. Funding is a series of separate, unglamorous acts: recording a new deed, retitling bank and brokerage accounts, assigning an LLC membership interest, updating a beneficiary designation, transferring a life insurance policy. Each asset class has its own mechanics, and some assets should deliberately not go into the trust.

Assets that generally should not simply be retitled to a living trust

• Retirement accounts — IRAs, 401(k)s and similar. Retitling one during life is generally a taxable event. The beneficiary designation is the planning tool here, and the rules for trusts named as retirement beneficiaries are technical.
• Certain business interests where an operating agreement or shareholder agreement restricts transfer, or where an S corporation election could be jeopardized.
• Vehicles and small personal accounts, where the administrative burden often outweighs the benefit.

The funding audit

The firm reviews the actual title of each significant asset against the plan on paper: what the recorded deed says, whose name is on each account, what each beneficiary designation form says today rather than what the client remembers signing. Where the two diverge, the plan is corrected — either by moving the asset or by amending the documents to match reality.

Estate and gift tax planning

A New York family with real money in the estate is planning against two separate tax systems at once, and the two do not work the same way. New York’s threshold is far lower than the federal one, New York gives a married couple no way to carry an unused exclusion from the first death to the second, and New York has a penalty built into its arithmetic that the federal system does not have. The result is that a plan built only around the federal rules can leave a seven-figure New York bill on the table.

Why the New York side is the harder problem

Most New York families who owe estate tax owe it to Albany, not to Washington. Three features of the New York statute account for that.

1. The cliff

New York does not give an exclusion in the way people expect. It gives a credit, and the credit disappears. An estate at or under the exclusion pays nothing. Between the exclusion and 105% of it, the credit phases out on a ramp. Once the taxable estate passes 105%, the statute says no credit at all — and New York then taxes the estate from the first dollar, not just the amount above the threshold.

2. No portability between spouses

Federal law lets a surviving spouse use whatever exclusion the first spouse did not — but only if the election is made on a timely filed federal estate tax return, which means filing a return even when no tax is due. Miss it and the couple’s combined federal exclusion is not what they assumed.

New York has no equivalent at all. A will that leaves everything outright to the surviving spouse uses New York’s marital deduction at the first death and throws the first spouse’s entire New York exclusion away. Everything then sits in one estate, closer to one cliff.

3. No gift tax, but a three-year look-back

New York repealed its gift tax in 2000, so lifetime gifts are not taxed by the state. What New York does instead is add certain taxable gifts back into the estate if the person dies within three years of making them. The window runs backward from the date of death, so it moves with you.

The add-back has real limits worth knowing: it does not reach gifts made while the person was not a New York resident, gifts of real or tangible property located outside New York, or gifts made before April 2014. And it is scheduled to expire — the provision does not apply to estates of people dying on or after January 1, 2032. Whether that sunset survives is a legislative question nobody can answer today.

The planning point is timing. Gifting is a New York strategy when it is done early and deliberately. It is a much weaker one done late.

What is actually done about it — New York

• Credit shelter or bypass trust. The answer to non-portability. Instead of leaving everything outright to the survivor, the plan directs an amount up to the New York exclusion into a trust at the first death. The surviving spouse can be provided for from it, but the assets are not taxed again in the survivor’s estate — so the couple uses two exclusions instead of one. See blended families, where the same structure does a second job.
• Disclaimer planning. A variation that leaves the decision until after the first death, when the actual numbers are known, rather than locking it in years earlier.
• Charitable “Santa Clause” provisions. A formula clause in the will or trust directing that anything above the cliff threshold passes to charity. Because a charitable bequest reduces the taxable estate, the estate drops back under the line. For an estate sitting just over the cliff, giving away the excess can leave the family with materially more than keeping it would have.
• Lifetime gifting, done early. Outside the three-year window, and weighed against the loss of the step-up in basis — an asset given away during life keeps its original basis, so an income tax bill can replace an estate tax bill.
• Irrevocable life insurance trusts, so a policy the family is counting on to pay the tax is not itself part of what gets taxed.
• Valuation work on closely held business interests and real property, which is where the number that decides everything actually comes from.

What is actually done about it — federal

Above the federal exclusion the question changes from “which side of a line are we on” to “how much future growth can be moved out of the estate before it happens.” The tools are freezing techniques:

• Grantor retained annuity trust (GRAT). Assets go into a trust and pay a fixed annuity back for a term of years. Growth above an assumed IRS interest rate passes to the beneficiaries without using much exclusion. The catch is real: the grantor has to survive the term, or the assets come back into the estate and the exercise was for nothing.
• Sale to an intentionally defective grantor trust (IDGT). Assets are sold to a trust for a note. The trust is deliberately drafted so the grantor still pays the income tax on what it earns — which lets the trust grow without that drag, and is not itself treated as a taxable gift. It commits the grantor to a tax bill on income they no longer receive, which is the part families underestimate.
• Spousal lifetime access trust (SLAT). One spouse uses federal exclusion now to fund an irrevocable trust for the other. It banks the exclusion against future changes in the law while leaving the funds reachable, indirectly, through the beneficiary spouse. Divorce and the death of the beneficiary spouse are the two scenarios that have to be drafted for before it is signed.
• Dynasty and generation-skipping trusts. Allocating GST exemption so the assets can serve children, grandchildren and beyond without a transfer tax at each generation.

Property, entities and moving away

Three questions come up constantly, and the honest answers are narrower than the marketing around them.

• New York taxes New York property no matter where you live. A nonresident who owns real estate or tangible property physically located in New York is taxed by New York on it. Intangible property of a nonresident generally is not.
• Putting New York real estate into an out-of-state LLC does not reliably solve that. The theory — that an LLC interest is intangible property outside New York’s reach — is widely marketed. The Department of Taxation and Finance has addressed it directly and rejected it for the most common structure, a single-member LLC that is disregarded for federal income tax purposes: it looks through the entity to the real property. It has also said a post-death election to fix the entity’s classification will be ignored, so this is not repairable afterward. Structures that are genuinely respected as separate for federal tax purposes sit differently, but that ground is untested in New York and carries income tax and basis consequences of its own. Anyone presenting this as a settled technique is overselling it.
• Changing domicile is a real strategy and a commonly botched one. New York taxes its domiciliaries on everything, so leaving genuinely removes the state from the picture. But domicile is not a day count — it is where your permanent home is, and a New York domicile continues until abandonment is shown by clear and convincing evidence. Counting days addresses a different test: someone who keeps a permanent place of abode in New York and spends more than 183 days here is taxed as a statutory resident whatever their domicile, and any part of a day counts as a day. Both tests have to be dealt with, and the evidence has to be built while you are moving, not produced afterward.

Which set of rules is yours

Most families the firm sees are in the first column and have been given advice from the second. The two are not interchangeable.

Special needs and supplemental needs trusts

An inheritance left outright to a person receiving needs-based public benefits such as Medicaid or SSI can disqualify them from those benefits — often just as the family that was providing support is no longer there.

A supplemental needs trust is designed to hold assets for that person’s benefit without the assets being counted as their own resource, so the trust supplements rather than replaces what the programs provide. There are different structures depending on whose money funds the trust:

• Third-party supplemental needs trusts are funded with someone else’s assets — typically a parent’s or grandparent’s, by will or during life. These generally do not require a payback to the state at the beneficiary’s death, so remaining funds can pass to other family members.
• First-party or self-settled trusts hold the disabled person’s own assets, such as a personal injury settlement or an inheritance received outright. These are subject to strict requirements and generally include a payback provision.
• Pooled trusts administered by nonprofit organizations can be an option where a smaller amount does not justify a standalone trust.

Same-sex couples and unmarried partners

New York has treated same-sex spouses identically to any other spouses since the Marriage Equality Act took effect in July 2011 — four years before the Supreme Court decided Obergefell. The Domestic Relations Law provision it added requires every New York statute to be read without regard to the spouses’ sexes, so the intestacy rules and the spousal right of election apply the same way to a same-sex marriage as to any other. A married couple does not need a special kind of estate plan.

The exposure is for couples who are not married, and it is severe:

• Intestacy gives an unmarried partner nothing. New York’s intestate distribution statute runs to a surviving spouse and to blood and adoptive relatives. A partner of thirty years is a legal stranger to the estate. Without a will, the property goes to parents, siblings, nieces and nephews.
• There is no right of election. The elective share protects a surviving spouse. An unmarried partner who is left out of a will has no statutory claim to elect against it.
• The home is the usual flashpoint. How the deed reads decides what happens, and it frequently does not read the way both partners assumed. Joint tenancy with right of survivorship passes outside the will; tenancy in common does not.

Health care decisions

New York’s Family Health Care Decisions Act does place a domestic partner in the same priority class as a spouse when there is no health care proxy, ahead of adult children and parents. That is better than many people expect, and better than the law in a number of other states. Two limits are worth knowing before relying on it. The statute defines who counts as a domestic partner, there is no statewide registry to point to, and the showing can be disputed by a relative at exactly the wrong moment. The priority list also applies in hospitals, residential health care facilities and hospices rather than in every setting.

Children

New York’s Child-Parent Security Act, in effect since February 2021, created a court procedure for establishing parentage in assisted-reproduction cases. Intended parents need not be married, and a judgment of parentage can be obtained before or after the birth. It is a real improvement and it is not a reason to skip adoption: a judgment of parentage is less well understood outside New York than an adoption decree, and families who may live, travel or hold property in other states or countries are still generally better served by completing a second-parent adoption as well. Which route fits is a conversation, not a form.

Documents written before 2011

Plans drafted when a partner could not be a spouse often worked around the law with arrangements that are now unnecessary or actively unhelpful — joint accounts opened for access rather than ownership, deeds restructured for reasons that no longer apply, trusts built to substitute for rights the couple now has by marriage. If the documents predate the marriage, they are worth reading again.

Structured settlements in an estate plan

A structured settlement pays an injury or malpractice recovery out over years instead of in one check. The firm does not bring the underlying injury cases. What it handles is what the structure means afterward — how the payments sit alongside benefits, what happens to them at death, and what a court requires before anyone sells them.

• Payments and needs-based benefits. Structured payments arriving in the injured person’s own name are their own income and resource, which is how a settlement meant to provide for someone’s care ends their Medicaid or SSI instead. Directing the payments to a properly drafted first-party supplemental needs trust is the usual answer, and it is far easier to arrange before the settlement is finalized than after. See special needs and supplemental needs trusts above.
• What happens at death. Whether anything remains depends entirely on how the annuity was written — guaranteed payments for a term continue to a named beneficiary or to the estate, while payments for life simply stop. Two settlements that look the same produce opposite results. The annuity contract is the document that answers it, and it is worth locating while the plan is being written rather than after.
• Selling the payment rights. New York does not let a payee sell a structured settlement by signing a contract with a buyer. The Structured Settlement Protection Act requires a court to approve the transfer in advance and to find, among other things, that the transfer is in the payee’s best interest taking account of dependents, that the discount rate, fees and expenses are fair and reasonable, and that the payee received independent professional advice about the legal, tax and financial consequences or waived it knowingly and in writing.

Blended families, digital assets and pets

Blended families and second marriages

The central tension is straightforward: providing for a current spouse while making sure children from a prior marriage actually inherit. Leaving everything outright to a spouse with an understanding that they will pass it on to your children relies entirely on that spouse’s later choices, their later spouse, and their own creditors. It is not a plan.

New York’s spousal elective share means a surviving spouse generally cannot be disinherited without a valid waiver, which affects what is possible. Common tools include trusts that provide income to the surviving spouse with remainder to the children, prenuptial or postnuptial waivers, separate property discipline, and life insurance used to equalize.

Digital assets and online accounts

Photographs, email, cryptocurrency, domain names, loyalty points, business social media accounts and cloud storage all present the same problem: a fiduciary may have legal authority but no practical access, and service providers’ terms of service and federal privacy law limit what they may disclose. New York has adopted a version of the fiduciary access act that lets a fiduciary obtain access under defined circumstances, and many providers offer their own legacy contact settings that operate independently of your will.

• Grant digital asset authority explicitly in the will, trust and power of attorney
• Use the provider’s own legacy or inactive account tools where offered
• Maintain an inventory — separate from the will, since a will becomes public — of where things live and how they are secured
• Treat cryptocurrency as a special case: without the keys, the asset is simply gone

Pet trusts and animal care planning

New York permits a trust for the care of a designated animal alive during the grantor’s lifetime. It names a caregiver, names someone to enforce the arrangement, funds the care, and says what happens to any remainder. A bequest of money to a friend with a request that they look after the dog is not enforceable in the same way. Naming a caregiver and a backup, and funding the arrangement realistically, is what keeps animals out of shelters after an owner dies.

Documents to bring

The first meeting goes faster and produces better advice if you bring whatever you have of the following. Missing items are normal — bring what exists.

• Any existing will, trust, power of attorney, health care proxy or living will
• The recorded deed to your home and any other real property you own
• Recent mortgage, home equity or reverse-mortgage statements
• A list of bank, brokerage and retirement accounts, with how each is titled
• Beneficiary designation forms for retirement accounts, annuities and life insurance
• Life insurance policies, including any group coverage through an employer
• Business documents — operating agreement, shareholder agreement, buy-sell agreement
• Prenuptial or postnuptial agreements and any divorce judgment or separation agreement
• Long-term-care insurance policies
• A written list of who you want to receive what, and who should be in charge

What working with the firm looks like

1. Free initial consultation. A phone call or half-hour meeting to understand the situation and tell you whether you need what you think you need.
2. Document and title review. The firm reads the deed, the designations, the prior documents and the account titling.
3. A written plan and a fee quote. What is recommended, why, what it costs, and what alternatives exist.
4. Drafting and review. Documents prepared, explained in plain language and revised until they say what you mean.
5. Execution. Signing with the formalities New York requires.
6. Funding. The step that makes it real — deeds recorded, accounts retitled, designations updated.
7. Review when life changes.

Frequently asked questions