Every state has a set of procedures that allow for a simplified probate process. Simplified probate, sometimes called summary probate, is a way to transfer estate property to new owners without having to go through the often complicated and lengthy process of formal probate. Though the exact rules for simplified probate differ by state, let’s take a look at two different types of simplified probate.

Summary Administration: In some states, the personal representative can begin transferring estate assets almost immediately after being appointed, as long as certain conditions are met. The personal representative, sometimes called an executor, is the person appointed by the court to handle the estate settling process. If the estate qualifies, the administrator does not have to provide notice to creditors and can begin distributing estate property immediately. Once finished, the administrator files a verified statement with the probate court stating the details of the distribution.

Collection of Personal Property By Affidavit: Another form of simplified probate allows inheritors to file an affidavit with the court and take estate property directly. Affidavits are sworn statements in which people claiming property must swear under oath that they are entitled to receive that property. However, the person filing the affidavit must be certain there are no disagreements about who is entitled to the property, and the property itself must be less than a specific amount as determined by state law.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

To someone with no background in the law, a contract and a last will and testament may appear to be very similar, though they are in fact quite different. A will is an expression of your desires, while a contract is an agreement between you and someone else.  However, though the two are quite different in their creation and effect, you can enter into contracts that affect your will. State laws impose limits on how you can do this, but let’s take a look at a few examples.

Contract to Provide. You are generally under no obligation to create a will or, once you do, to leave anything to your children, family members or anyone else. However, you can choose to enter into a contract in which you promise to provide for someone in your will. This promise has value and you can use it as part of a contract. If you violate the terms of the contract by not including the agreed-upon provision in your will, the person to whom you made the promise can sue your estate for a breach of contract.

Contract not to Revoke. Another kind of contract you can enter into that affects your will is one that prevents you from changing the terms. Normally, you can change the terms of your will at any time. You can also provide for someone in your will and then use that provision, and a promise to not change or revoke those terms as a part of a contract.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

Though she died in 2007 at the age of 105, Brooke Astor’s estimated $100 million estate has been fought over in a New York State probate court ever since then. Much of the conflict involves whether her son, Anthony D. Marshall, would manage the charitable donations Ms. Astor had directed in her Last Will and Testament. However, since Mr. Marshall, age 87, has been convicted of defrauding his mother while she was still alive, the case has become much more complicated and has been in the headlines even before her death.

The settlement reached in court will grant Mr. Marshall approximately half of the $31 million inheritance he would have originally received. The rest of the estate funds will be used in establishing a Brooke Astor Fund for New York City Education, as well as be distributed to other charitable organizations in New York.

The Office of the New York Attorney General Eric T. Schneiderman reached the settlement with all the parties involved in late March. Mr. Marshall is still awaiting the outcome of an appeal he filed for his criminal conviction. If he loses the appeal he will be sentenced to one to three years in prison. However, regardless of the outcome of the appeal, the probate settlement is binding and it will not be changed.

Before her death, Ms. Astor had dementia and had made several amendments to her Will that would have granted her son much more control over her estate, as well as reducing the amount she gave to charities. Mr. Marshall and an attorney were convicted of tricking her into signing the amendments. The settlement is based on the original Will terms and not the changes made after she was tricked.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

Once the probate process begins, the administrator has a responsibility to pay estate expenses. There are 6 basic types of estate expenses, each of which must be repaid with estate property. The types of expenses and the time in which they must be repaid differ by state, so consult with an experienced probate attorney if you need assistance.

Type 1: Funeral Expenses. When a person dies, the money used to pay for the funeral often comes from the surviving spouse or various other sources. These expenses are often repaid even before the will is probated. Regardless of the status of the will, they typically have top priority and are first to be repaid by the administrator.

Type 2: Administration Expenses. It costs money to administer an estate, and the administrator is entitled to recover the costs and fees due to him or her. Administration fees also cover attorneys fees incurred for the probate process or any litigation associated with it.

Type 3: Taxes. The administrator must pay federal and state estate or inheritances taxes. Federal taxes get paid first, then state taxes. Taxes can also include unpaid income or property taxes.

Type 4: Medical Expenses. If the decedent incurred medical expenses in his or her last illness, these get paid next. The expenses must have been incurred as a part of the decedent’s final illness, meaning the medical condition that led to or caused his or her death.

Type 5: Debts as dictated by law. State laws establish which creditors receive priority.

Type 6: Remaining debts. Any other debts not addressed by law are dealt with last.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

A good estate plan contains everything you need to not only ensure your property goes to whom you wish to receive it, but also covers what you want to happen to your body after you die. In Arkansas, you have the ability to take steps to state in detail as to what your funeral wishes are, and make sure someone has the legal authority to see they are followed.

Tip 1: Make your choices known. A good funeral plan starts by discussing your desires with your family and friends. Once you make your wishes clear, you can then ask someone to act as your agent to carry them out.

Tip 2: Give someone the authority to carry out your wishes. Arkansas law allows residents the right to designate someone else as their agent to carry out their funeral arrangements by creating a “Directions for Disposition” form. The law requires that you create or fill out a form stating who your agent is, what your wishes are and then sign the document. You must have two witnesses sign it as well.

Tip 3: Make arrangements with a funeral director. A good funeral director can walk you through the process and forms you need to fill out when making your funeral plans. However, there are specific laws that apply to funerals and pre-paid funeral plans.  It is important that you consult with your attorney when you are making funeral arrangements so that you can incorporate it into your overall estate plan.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

As reported on National Public Radio earlier this month, Medicaid currently provides health care coverage for one out of every three American children. With the new expanded coverage under the Affordable Care Act that will take effect in 2014, millions of more Americans may become covered under Medicaid. However, as the Supreme Court makes its decision on the case challenging the new law, legal experts are wondering if the court’s decision may fundamentally alter not just Medicaid and the healthcare law, but the way the states interact with the federal government on many other programs.

Medicaid is a voluntary program, meaning that states are not required to participate in it, but they do receive federal funding if they choose to do so. The new expansion guidelines under the Affordable Care Act will require states to provide coverage to many more patients who currently do not qualify. Part of the challenge to the law is this expansion of coverage. The states challenging the law are saying that this is coercive and should not be allowed by the court.

If the Supreme Court agrees with the coercion argument, it may strike down the law as unconstitutional. However, there are other Federal programs that use a similar voluntary funding and requirement structure that may be vulnerable to such a ruling. Federal educational, child welfare and other programs may be jeopardized if the court declares the Medicaid expansion to be coercive. Though the court has heard arguments, it will not issue a ruling until sometime this summer.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

The internet has changed so much of our day-to-day lives that we often rely on it when we really shouldn’t. If you’re beginning the estate planning process, you may be tempted to try out one of the many internet services or e-lawyering providers out there. These companies often offer to make your Will for you, establish a Trust or provide other services that attorneys usually provide.  Use these providers with extreme caution.

Errors. There are any number of potential errors that arise when you use an do-it-yourself legal service. For example, a review of one company’s Will creation software revealed 22 errors. The Will software mistakes included complete omissions of vital information, contradictions within the Will, mistakes about the changes in the law and even parts that were specifically prohibited by state law.

Competency. Unlike an attorney, companies that sell you pre-made Wills, Powers of Attorney or books and materials about estate planning do not face significant penalties if they make a mistake. Your lawyer does. Your estate planning attorney has a legal duty to provide you with sound, competent advice. If he or she doesn’t, the attorney’s career could be in jeopardy. In other words, an attorney has a legal obligation to provide you with good advice, while internet legal products do not.

Education. One great way to use the internet is to bolster your own knowledge about estate planning. But don’t let this introduction to estate planning give you false confidence. An experienced attorney has years of education and experience and stays current on all the relevant laws, not just the bullet-pointed highlights.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

Singer Amy Winehouse died last year in London at the age of 27. The singer had achieved remarkable success several years prior, but had since fallen on hard times. However, she left behind numerous assets and, as Forbes reports, did not have a Last Will and Testament. Though the laws of the United Kingdom are slightly different than those in the United States, there are enough similarities that we can learn a lot about our own probate process just by looking at the Winehouse Estate.

Question 1: What happens if I don’t have a Will?

Like Ms. Winehouse, if you don’t have a Last Will and Testament your property will go to specific people as determined by your state’s laws of intestate succession. These laws choose who receives your property and give your possessions to your closest family members, typically your spouse, children, or parents depending on who survives you after you die.

Question 2: Does probate cover everything you own?

Not necessarily. Though Ms. Winehouse’s probate estate was worth about $4.6 million after taxes and debts were accounted for, that doesn’t mean that was the total sum of her worth at the time of her death. If she had non-probate assets, such as Trusts, transfer on death accounts or jointly held assets, those would pass outside of the probate process and would not be included in the probate court documents.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

As part of your estate plan, you’ll probably come up with a long term care plan in case one day you lose your ability to care for all your needs. Of all the estate planning areas, long term care planning can be one of the more daunting as it forces us to accept that we may become more dependent on others. Though this may not be an easy pill for our pride to swallow, long term care is an important part of your estate plan, and you shouldn’t allow yourself to fall prey to certain myths that can harm your planning efforts.

Myth 1: I don’t need a plan because my spouse/child will take care of me. While having your family provide your long term care needs is the ideal solution for many people, it isn’t always possible. This is especially true if you’re relying on your spouse to care for you as you get older. Your spouse will face his or her own limitations and may not be able to provide full-time care, or worse, may cause more problems in the attempt.

Myth 2: Medicare provides all the long term care I need. While Medicare does provide for some long term care, the amount it provides for is extremely limited. For example, Medicare will only pay for 20 days of nursing home care after surgery, and it may pay for an additional 80 days, but only if you provide a daily co-payment. Further, Medicare rules may change and may not be as reliable as once believed.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.

Risk 1: You lose money. Failure to have an estate plan can cost you money both while you’re still alive and after you die. A good estate plan, for example,will take advantages of any laws that allow you to minimize any estate taxes. It will also make plans for you if you become unable to manage your finances if you get sick. Not taking the time to prepare for these situations can cause you to lose money both in taxes and court costs associated with having to appoint someone to run your financial affairs.

Risk 2: You cause family discord. If your family is important to you, or even if you want to disinherit someone, you should know that not having an estate plan is a great way to cause arguments, grief and even legal battles between family members. As long as you create an estate plan that makes your wishes clear, your family will at least know what you wanted. This won’t guarantee that fights won’t arise, but it will minimize the chances as much as possible.

Risk 3: Your state gets your property. While this is a very unlikely scenario, it can happen. All states have laws that determine who inherits your property, leaving that property to your relatives depending on who is the closest living relative at the time of your death. If you don’t have living family members that qualify under state law, your state may inherit everything you own.

Deborah Sexton Law Office, PA is a member of the American Academy of Estate Planning Attorneys.