Age(s) of payout and percentage to children for separate trust (staggered payments over more
than one age and different percentages are permitted (eg. 1/2 at 21, 1/3 at 25 and balance at
30):
If you choose E-mail, please select your word processor format from the following list:
Should you have any questions completing the form or desire revisions to the draft submitted to
you, please call me or email me 
to discuss your will.
E-mail
william.jaekel@verizon.net
RETURN TO FORM PAGE
RETURN TO HOME PAGE
Return to Form (Gifts)
Specific gifts of property and cash are
not required in wills. All
of your assets, whether
specifically identified or not, will pass according to your residuary gift, a sort of catch all. If there
is an amount of cash, business property, titled property (eg. an auto)or real property, other than
small articles of personal property such as personal effects, that you want to go a specific
individual or charity, the gift must be listed in the will.
(1.)Gifts of Cash. Be careful with cash gifts
since your financial
fortunes can change over the course of your life. What may have once been a small fractional gift
of your estate, may later result in your children receiving no inheritance as a result of a generous
gift to an aunt or even more remote relative, another reason to dust off and review that will every
few years.
(2.)Gifts of Real Property. Real property left
to a beneficiary under
your will passes title to the benficiary by the will document, not by a deed later drawn by your
executor. A proper legal description, minimally a tax lot and block number, but preferrably a full
legal description of the property, must be included to describe the gift.
(3.)Gifts of Pets. No beneficiary can be
forced to accept a gift under
your will. The only way to be assured that your pet is cared for perpetually is to provide for a
trust in your will to care for the pet. Such a trust can be expensive to establish and administer.
While not legally enforcible, a better practice might be to leave non-binding instructions in your
will for a trusted relative or friend to care for the pet with a gift of cash to that individual should
they elect to care for the pet.
(4.)Gifts of Business Property. Gifts of
stock or other business
property to a spouse or other beneficiary should be accompanied by a "business powers" clause in
your will. This clause grants your spouse or beneficiary powers to make business decisions, such
as the sale of the business or to make a bank loan for the business. Such a clause can be added to
your will by requesting a business clause in the "comments" block of the will form.
Return to Form (Gifts)
Residue and
Beneficiaries
Return to Form (residue)
The residue is all of the rest and remainder of your property not
disposed of by specific gift under
your will. Many clients feel that it is necessary to list all of their assets in the residuary clause.
This is actually a bad practice since your assets can change frequently over the years. This can
easily result in property being omitted from the will. A better practice is to assure that you
include and frequently update a list of assets with your will, identifying the nature of the asset, its
account, serial or identification number and its location. My guess is that many insurance policies
and stock brokerage accounts go unclaimed every year merely because the poor beneficiaries have
no idea what assets exist and where the asset can be found. Don't let this happen to you - leave
some sort of inventory.
(1.) How to leave your residue. While you
can attempt to divide up
your estate amongst your beneficiaries, this is a dangerous practice. An asset can be sold or
destroyed before your death, resulting in a lapse of the gift. A better practice is to leave each
beneficiary a fractional or percentage share of your estate.
(2.) What about children I wish to disinherit?
You may wish to make
no provision in your will for a child for any number of reasons. It is a good practice to make
specific reference in the will that you are making no provision for this child. Otherwise, that child
might attempt to challenge the will arguing that you were unaware of who your children were at
the time the will was drawn and thus incompetant to draw a will. There is no need to state your
reason to disinherit the child. If you wish a disinheritance clause in your will, please request the
clause under the "Comments" section of the form.
(3.) Death Taxes. Inheritance taxes should
be a major consideration in
deciding how to leave your residue. So long as your residue is left to your spouse, parents or
children, there is no inheritance tax due to New Jersey. Gifts in excess of $25,000.00 to brothers
and sisters are taxed at rates from 11% to 15%, while more remote relatives and friends receive
only a $500.00 exemption. At the federal level, generally all gifts to your spouse are tax free, but
gifts to your children and all others, other than charities, are taxed to the extent that the gift
exceeds $600,000.00. If you have an estate in excess of $600,000.00, you should not be using this
program, but seeking counsel from an attorney experienced in federal estate planning.
(4.) Ultimate
Distribution. If you have a
small family and feel that you wish to make provisions in the event that your primary and alternate
beneficiaries should all die in some common disaster, you may want to include an ultimate
distribution clause (e.g. Should all of my beneficiaries and their lineal descendants predecease me,
I give my estate to the following:).
(5.) For Married Couples without Children.
These wills can be
difficult. One reason to have a will is to assure that your parents and your in-laws do not have to
litigate to determine whether you or your spouse died first in a common disaster. Without a will,
the last to die would take all, which would pass under the NJ intestate statute to that spouse's
family, not a pretty picture. A fair way to resolve this problem is to provide that the alternate
beneficiary in each will receuves 1/2 of the assets to the husband's relatives or chosen beneficiaries
and the other 1/2 passes according to the wife's wishes. This is call a "mirror will".
Return to Form (residue)
Return to Form (executor)
The executor is the individual whom you select to administer your
estate. The executor is
responsible for probating the will, filing the necessary inheritance tax returns, distributing the
assets of the estate according to your will and also for investing the assets until the assets or
money can be distributed. Obviously, this individual should be someone you trust. Most clients
will select their spouse as executor or executrix. An alternate should also be selected in case of a
common disaster. The alternate should, where possible, be one or more adults, responsible
children or trusted friends.
A bank, trust company or attorney can also be selected. On the plus side,
professional executors
have experience in administering estates. Also, they can be surcharged (be held accountable) if
they lose estate assets by investing negligently. They are also neutral parties in the event that you
anticipate inter-sibling warfare over the assets of the estate. On the down side, they are entitled to
a commission under New Jersey law for performing this service based on the size of the
estate.
Return to Form (executor)
Return to Form (trusts)
Under New Jersey law, a child becomes an adult when he or
she reaches the
age of 18. Many
people feel that this is too young an age for a child to come into an inheritance. The child may
lack the maturity to use the money wisely. A prudently invested trust can assure that the child
will be supported and educated to that child's ability. The minor trust in your will gives broad
power to the trustee including the power to dip into the corpus or body of the trust for the broad
purposes of the child's health, welfare and education.
Two kinds of trusts can be created for minor children. First, separate trust
funds can be created
for each child and distributed at one or a series of ages. This is certainly the fairest dispostion
since each child receives an equal amount to be used according to his or her needs. However, if
your primary wish is to assure that all of your children are educated through college, there may
not be adequate funds in a younger child's trust to assure that this goal is reached. The second
type of trust is called a "sprinkle" or
"pot"
trust and pays out of a single larger trust fund for the benefit of all of your children until the
youngest child reaches a certain set age. At that time, the trust is distributed equally amongst the
children. If you have 3 or more children and an estate less than $500,000.00, you may want to
consider a "sprinkle" or "pot" trust for your children.
The considerations in selecting a trustee for your minor children are the
same as those in selecting
your executor. Rather than being paid a
commission, the trustee is paid
a percentage (up to 6%) of the income of the trust. Ideally, if you have a relative or child who is
responsible and prudent, that individual can serve as all three, alternate executor, alternate trustee
and guardian for minor children. This eleminates the possibility of disputes between a guardian
and trustee or executor over the adequacy of income paid to support the children.
Return to Form (trusts)
Return to Form (guardian)
The guardian is the individual or individuals whom you designate
to take physical custody of your
child or children. The guardian is responsible for decisions regarding the health, education,
religion and general up-bringing of your children. Actually, the State of New Jersey is the ultimate
guardian for your children. Should your choice be deemed imprudent, the selection can be
changed by the Surrogate's Court in the best interests of the children. However, it is, often a
matter of two or more fit relatives, fighting for custody of your children. To avoid litigation by
such qualified relatives as to who is fittest, you should designate an alternate guardian (you will
probably want to appoint your spouse as primary guardian). The courts will normally honor your
choice, if it is reasonable, thus avoiding litigation.
Often a husband and wife cannot agree on the appointment of an alternate
guardian. My advice is
to select each other as guardian and omit the selection of an alternate. Your will is important for
so many other reasons that it should not be deferred until the children reach age 18.
Return to Form (guardian)
Return to Form
(1.) Durable Power of Attorney. The power of attorney need only be
signed by you as your name appears. The power of attorney must be witnessed by a notary
public.
(2.)Living Will.The living will must be witnessed by
two
witnesses and
acknowledged by a notary public.
(3.) Last Will and Testament.The signing or
execution
of a will is very
simple; however, if there is any deviation from the procedure the surrogate may not admit the will
to probate.
a. It is a good practice, but not required, to initial each page of the will in
the bottom margin, particularly if the will has been stapled and re-stapled.
b. The will
must be signed exactly as your name appears before at least two witnesses on the signature line in
black ink, preferrably but again not required. The witnesses must watch you sign and you and the
witnesses must watch each other sign. Make sure that no one leaves the room while you and the
witnesses are signing. Who can act as witness? NJ permits spouses and other beneficiaries to
witness the will; however, I do not think this is a good practice except in an emergency. Many
states still disallow gifts to beneficiaries who witness a will. Should you move to such a state, it
could cause problems.
c. NJ allows self-proving wills. This means that the will is
admitted to probate without having to call at least one witness to the surrogate's office to prove
the will. This is important particularly when the will was signed many years ago and witnesses
have moved or died. To qualify as a self-proved will, the testator must sign the affidavit which is
provided with your will and a notary public at the end of the will document must acknowledge the
will.
Congratulations! You are now testate!
Return to Form
E-mail
william.jaekel@verizon.net
© William C. Jaekel, Esq., 1996
55 Harristown Road
Glen Rock, New Jersey 07452
(201 )652-1113
RETURN TO FORM PAGE
RETURN TO HOME PAGE
