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Preface to the Thirteenth Edition |
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Chapter 1: |
Introductory and General Matters; And Appendices 1A-1I |
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- § 1:1 : Introduction1-4
- § 1:2 : Appendices1-5
- § 1:3 : Scope of Discussion and Models1-5
- § 1:4 : Importance of Statutory History1-6
- § 1:4.1 : Major Changes in the New York Statutes over the Last Two Decades1-7
- § 1:5 : The Drafter’s Objectives1-9
- § 1:5.1 : Styles of Drafting1-10
- § 1:6 : Will or Trust?1-11
- § 1:7 : Legal Restrictions on Wills and Trusts1-15
- § 1:7.1 : Minimum Age and Capacity Required for Making a Will or Trust1-15
- § 1:7.2 : Property Not Disposable by Will or Trust1-16
- § 1:7.3 : Statute of Frauds (Contract to Make a Will)1-17
- § 1:8 : Marriage and the Rights of the Surviving Spouse1-18
- § 1:8.1 : Traditional Marriages1-18
- § 1:8.2 : Nontraditional Marriages1-19
- [A] : New York Law Prior to the Marriage Equality Act1-22
- [B] : Drafting Suggestions1-24
- § 1:8.3 : Right of Election of Surviving Spouse1-25
- [A] : New York Model1-26
- [B] : Testamentary Substitutes1-29
- [B][1] : Life Insurance As a Testamentary Substitute for New York Elective Share Purposes1-30
- [B][2] : Retirement Plans and Options As Testamentary Substitutes1-32
- [C] : Further Regarding the Elective Share—Calculation1-32
- [D] : Effect of Real Property Situs on Elective Share1-35
- [E] : Waiver of Elective Share (New York Model)1-36
- [F] : Impact of the Elective Share1-37
- [G] : Barring Elective Share, Dower and Other Rights1-37
- § 1:9 : Rights of Children1-38
- § 1:9.1 : Forced Heirs1-38
- § 1:9.2 : After-Born Children and Children of Assisted Reproduction Technologies1-39
- [A] : After-Born or Pretermitted Children1-39
- [B] : Posthumously Conceived Children1-42
- [C] : Children of Assisted Reproduction Technologies1-46
- § 1:9.3 : Adopted Children1-48
- [A] : New York Pre-1964 Precautionary Addendum1-49
- [B] : Post-1964 New York Law1-50
- [C] : Other States1-50
- [D] : Choosing to Exclude Adopted Children1-50
- [E] : Inheritance Rights of Adopted-Out Children1-51
- [F] : Drafting Suggestions1-52
- § 1:9.4 : Non-marital Children1-52
- [A] : The Evolving Treatment of Non-marital Children1-53
- [B] : New York Definition of Paternity1-54
- [C] : Presumption of Inclusion1-56
- [D] : Drafting Solutions1-57
- [E] : Choice of Law1-58
- [F] : Reproduction Technologies1-58
- § 1:10 : Need for a Comprehensive Estate Plan1-60
- § 1:10.1 : Life Insurance1-60
- § 1:10.2 : Other Benefits1-61
- § 1:10.3 : Family Residence1-61
- § 1:10.4 : Lifetime Trusts and Gifts1-61
- § 1:10.5 : Statutory Rights1-63
- § 1:10.6 : Taxes1-63
- § 1:11 : Introductory Clause1-64
- § 1:11.1 : Wills1-64
- [A] : Name of Testator1-65
- [B] : Recital of Residence1-65
- § 1:11.2 : Trusts1-67
- [A] : Trust Agreements1-67
- [B] : Declarations of Trust1-68
- [C] : Trust Clause1-69
- § 1:11.3 : Other Introductory Matter in Will1-69
- § 1:11.4 : Nomenclature1-69
- § 1:12 : Debts, Funeral Expenses, and Funeral Directions1-70
- § 1:12.1 : Debts1-70
- § 1:12.2 : Funeral Expenses1-70
- § 1:12.3 : Funeral Directions1-71
- § 1:12.4 : Cemetery Plots1-71
- § 1:13 : Common Disaster or Simultaneous Death1-72
- § 1:14 : In Terrorem Clauses and Conditions1-75
- § 1:14.1 : Actions Permitted Notwithstanding In Terrorem Clauses1-77
- § 1:15 : Execution of Will1-79
- § 1:15.1 : Attestation Clause1-79
- § 1:15.2 : Process of Completing and Signing the Will1-81
- [A] : Selection of Witnesses1-82
- [B] : Will Execution Ceremony1-85
- § 1:15.3 : Alternate Attestation Clause1-88
- § 1:15.4 : Affidavit of Due Execution1-88
- § 1:15.5 : Additional Observation on Formalities1-89
- § 1:15.6 : Choice of Law1-90
- § 1:15.7 : Destruction of Previous Wills1-90
- § 1:15.8 : Safekeeping of Wills1-91
- § 1:16 : Undue Influence1-92
- § 1:17 : Joint Wills1-97
- § 1:17.1 : Concurrent Execution of Separate Wills1-98
- § 1:17.2 : Mutual Wills: Ongoing Litigation1-98
- § 1:18 : Execution of Trusts1-100
- § 1:19 : Holographic Wills, Forms and Computer-Assisted Drafting1-101
- § 1:19.1 : Holographic Wills1-101
- § 1:19.2 : Pre-Printed Forms1-101
- § 1:19.3 : Computer-Assisted Drafting1-102
- § 1:20 : Review and Revision of Wills and Codicils1-103
- § 1:20.1 : Codicil or New Will?1-104
- § 1:21 : Pourover Provisions1-106
- § 1:21.1 : Reverse Pourovers1-106
- § 1:22 : Revocation1-107
- § 1:22.1 : Revocation of Prior Wills1-107
- § 1:22.2 : Revocation of Lifetime Trusts1-109
- § 1:23 : Uniform Gifts or Transfers to Minors Act1-109
- § 1:23.1 : Age at Which Custodianship Terminates1-110
- § 1:23.2 : Territorial Application1-111
- § 1:23.3 : Investment Standard1-111
- § 1:23.4 : Income Tax Issue Addressed1-112
- § 1:23.5 : Compensation1-112
- § 1:24 : Honorary Trusts for Pets1-113
- § 1:24.1 : Statute on Trusts for Pets1-116
- Appendix 1A : Form of WillApp. 1A-1
- Appendix 1B : Short Form of Will with TrustApp. 1B-1
- Appendix 1C : Short Form of Will without TrustApp. 1C-1
- Appendix 1D : Self-Proving Affidavits for Witnesses upon Execution of WillApp. 1D-1
- Appendix 1E : Uniform Probate Code Form for Self-Proved WillApp. 1E-1
- Appendix 1F : CodicilApp. 1F-1
- Appendix 1G : Framework of Inter Vivos Trust Instrument (Revocable)App. 1G-1
- Appendix 1H : Alternative Initial Provisions for Insurance Trust (Irrevocable)App. 1H-1
- Appendix 1I : Example of Provisions for Use of Trust Funds During Grantor’s LifeApp. 1I-1
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Chapter 2: |
Legacies, Bequests and Devises; And Appendices 2A-2H |
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- § 2:1 : Introduction to Legacies, Bequests and Devises2-2
- § 2:2 : Specific Legacies2-3
- § 2:2.1 : Specific Bequest to Infant2-6
- § 2:2.2 : Legacies of Personal and Household Effects2-7
- § 2:2.3 : Incorporation by Reference, Separate Instructions and Precatory Requests to the Legatee to Make Gifts2-11
- [A] : Tax Opportunities2-13
- [B] : Alternate Approach: Power of Appointment2-13
- § 2:2.4 : Cooperative Apartments2-14
- § 2:2.5 : Specific Intangible Bequests2-15
- § 2:2.6 : “Residual” Specific Bequests2-16
- § 2:2.7 : Encumbrances on Bequests2-17
- § 2:2.8 : Life Estate in Tangible Property2-18
- § 2:3 : General Legacies2-19
- § 2:3.1 : Interest on General Legacies2-19
- § 2:3.2 : Separate or Omnibus Paragraphs2-20
- § 2:4 : General and Specific Legacies Contrasted; Effect on Post-death Income and Executors’ Commissions2-21
- § 2:5 : Demonstrative Legacies2-23
- § 2:6 : Residuary Legacies2-23
- § 2:6.1 : Negative Wills2-26
- § 2:7 : Gifts by Implication2-27
- § 2:8 : Identification of Legatees2-29
- § 2:9 : Allocation of Estate Taxes2-33
- § 2:10 : Survivorship of Legatee; Lapse2-35
- § 2:10.1 : Lapse of Residuary Legacies2-36
- § 2:10.2 : “Per Stirpes” and “Per Capita”2-39
- § 2:10.3 : “By Representation”2-42
- § 2:11 : Preferred Legacies2-44
- § 2:12 : Abatement of Legacies2-45
- § 2:13 : Forgiveness of Indebtedness2-47
- § 2:14 : Advancements2-47
- § 2:15 : Devises of Real Estate2-48
- § 2:15.1 : Description of Real Property2-49
- § 2:15.2 : Creation of Tenancy in Common2-50
- § 2:15.3 : Infant Devisees2-51
- § 2:15.4 : Compliance with Law of Situs2-52
- § 2:15.5 : Life Estate in Real Property2-52
- § 2:15.6 : Condominiums and Cooperative Apartments2-55
- § 2:16 : Charitable Legacies and Devises2-59
- § 2:16.1 : Limitations on Charitable Gifts2-60
- § 2:16.2 : Tax Aspects of Charitable Gifts2-61
- § 2:16.3 : Reformation and Amendment of Charitable Trusts2-63
- § 2:17 : Disclaimers and Renunciations2-64
- § 2:18 : Exercise of Power of Appointment2-66
- § 2:19 : Uniform Probate Code2-68
- § 2:19.1 : Elective Share2-69
- [A] : 1969 UPC2-69
- [B] : 1990 UPC: Radical Reform2-71
- [C] : 2008 UPC Amendments: Change in Form2-72
- § 2:19.2 : Anti-Lapse2-73
- [A] : 1969 UPC2-73
- [B] : 1990 UPC: Traps for the Unwary2-73
- [C] : Specific State Approaches2-74
- § 2:19.3 : Future Interests in Trust: Fundamental Change2-75
- § 2:19.4 : Ademption2-75
- [A] : 1969 UPC: The Traditional Approach, Somewhat Liberalized2-75
- [B] : 1990 UPC: A Break from Tradition2-76
- § 2:19.5 : Class Gifts to Issue2-77
- § 2:19.6 : Expanded Provisions Concerning the Effect of Divorce or Other Termination of Marriage2-77
- § 2:19.7 : Will Execution Requirements2-78
- § 2:19.8 : Chart Comparing New York Law and the UPC2-78
- Appendix 2A : Bequest of Stock Options and Deferred CompensationApp. 2A-1
- Appendix 2B : Personal and Household EffectsApp. 2B-1
- Appendix 2C : Cooperative Apartment, Free and Clear, to One Child; Equalizing Bequest to Other ChildApp. 2C-1
- Appendix 2D : Life Estate in House with Right to Rent (or Sell)App. 2D-1
- Appendix 2E : General Gift of ResidenceApp. 2E-1
- Appendix 2F : Residue of Unmarried, Childless TestatorApp. 2F-1
- Appendix 2G : Trust Saving ClausesApp. 2G-1
- Appendix 2H : Survivorship Phraseology: AlternativesApp. 2H-1
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Chapter 3: |
Trusts; And Appendices 3A-3E |
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- § 3:1 : Introduction3-3
- § 3:1.1 : Desirability of Trusts—Testamentary and Inter Vivos3-4
- [A] : Protection of Beneficiaries3-5
- [B] : Transfer Tax Savings3-6
- § 3:1.2 : Preliminary Considerations—Inter Vivos Trusts3-8
- [A] : Revocability3-8
- [B] : Unilateral or Bilateral3-9
- [C] : Number of Trust Instruments3-10
- § 3:2 : Creation of Inter Vivos Trusts3-10
- § 3:2.1 : Trust Situs/Choice of Law3-10
- [A] : Selected Favorable Attributes of Trust-Friendly Jurisdictions3-11
- [A][1] : State Level Income Tax Savings3-11
- [A][2] : Enhanced Creditor Protection3-12
- [A][3] : Bifurcation of Duties3-14
- [B] : Choice of Law3-14
- § 3:2.2 : Execution Formalities3-15
- § 3:2.3 : Funding3-15
- § 3:3 : Matters Directly Impacting Dispositions of Trusts3-16
- § 3:3.1 : Definition of the Current Interest—Traditional Approach or Annuity or Unitrust3-16
- [A] : Traditional Approach3-16
- [B] : Annuity Trusts and Unitrusts—Overview3-17
- [C] : Annuity Trusts3-18
- [D] : Statutory Unitrusts3-20
- § 3:3.2 : Remainder Interests3-20
- [A] : Vested Remainders versus Contingent Remainders—The Basic Distinction3-21
- [B] : Remainder to a Class; Importance of Survivorship Language3-23
- [C] : Continuing Trusts3-23
- [C][1] : Introducing Continuing Trusts3-24
- [C][2] : Establishing Continuing Trusts for Children3-25
- [C][3] : Remote Contingencies3-26
- § 3:3.3 : Mandatory or Discretionary Distributions3-28
- [A] : In General3-28
- [B] : Mandatory Distributions3-28
- [C] : Discretionary Distributions3-29
- § 3:3.4 : Powers of Appointment3-36
- [A] : Tax Considerations in Creating Powers of Appointment3-38
- [A][1] : General Powers of Appointment3-38
- [A][2] : Non-General, Special or Limited Powers of Appointment3-40
- [A][3] : Powers of Withdrawal; “5 and 5” Powers3-41
- [A][4] : Ascertainable Standards3-42
- [B] : Power to Appoint in Further Trust3-44
- [C] : Specimen Language Creating Powers of Appointment3-44
- [D] : Considerations Applicable to the Exercise of Powers of Appointment3-45
- [D][1] : Compliance with Conditions3-45
- [D][2] : Compliance with the Rule Against Perpetuities3-46
- § 3:3.5 : Alternative Drafting Forms3-48
- [A] : Traditional Trusts3-48
- [B] : Annuity Trusts and Unitrusts3-48
- [C] : Modification for Inter Vivos Trusts3-48
- § 3:4 : Matters Indirectly Impacting Dispositions of Trust3-48
- § 3:4.1 : Tax Apportionment3-48
- § 3:4.2 : Rule Against Perpetuities (RAP)3-49
- [A] : Interests Subject to RAP3-50
- [A][1] : Exclusion of Future Interests Retained by Creator; Future Interests Created in Charities3-50
- [A][2] : Inapplicability to Powers in Trust3-50
- [A][3] : Inapplicability to Options to Renew Commercial Leases3-51
- [B] : Choice of Law3-51
- [C] : New York3-51
- [C][1] : Prior Law3-51
- [C][2] : Current Law3-52
- [C][3] : Example: Trust for Grandchild3-55
- [C][4] : Prior RAP Trap: Unborn Widow3-56
- [C][5] : RAP Trap: Trusts Lasting for a Fixed Term Exceeding Twenty-One Years3-57
- [C][6] : Additional Drafting Points3-57
- [C][7] : Diagrams3-57
- [D] : Uniform Rule3-58
- [E] : Savings Clauses3-58
- [F] : Rule Against Suspension of Power of Alienation Distinguished3-59
- § 3:4.3 : Limitations on Accumulations of Income3-60
- § 3:5 : Matters Not Impacting Dispositions of Trust3-62
- § 3:5.1 : Application of Income3-62
- [A] : Authorization to Apply Income3-62
- [B] : Facilitating the Application of Income3-63
- § 3:5.2 : Spendthrift Provisions3-64
- [A] : Protecting Beneficiaries3-64
- [B] : Protecting the Settlor—Self-Settled Trusts3-66
- § 3:5.3 : Corporate Trustees3-67
- § 3:5.4 : Classification As a Domestic Trust or a Foreign Trust3-69
- § 3:5.5 : Changing Trust Situs3-71
- § 3:6 : Power in Trust Distinguished from Trust3-73
- § 3:7 : Uniform Trust Code3-77
- § 3:7.1 : Creation of Trusts3-78
- § 3:7.2 : Revocation of Trusts3-79
- § 3:7.3 : Reformation of Trusts3-79
- § 3:7.4 : Capacity to Execute Revocable Trusts3-81
- § 3:7.5 : Removal of Trustees3-81
- § 3:7.6 : Spendthrift Trusts and Creditor Protection3-83
- § 3:7.7 : Notice to Beneficiaries3-84
- § 3:7.8 : Trusts for Pets3-85
- § 3:7.9 : Chart Comparing New York Law and the UTC3-86
- Appendix 3A : Sample Traditional Trust Provision—Omnibus ApproachApp. 3A-1
- Appendix 3B : Sample Traditional Trust Provision—Subparagraph ApproachApp. 3B-1
- Appendix 3C : Sample Non-Charitable Unitrust Clause—Including Testamentary Power of Appointment (As an Article in an Inter Vivos Trust)App. 3C-1
- Appendix 3D : Sample Incentive Trust (As an Article in an Inter Vivos Trust)App. 3D-1
- Appendix 3E : Sample Governing Law and Situs Change Trust ProvisionApp. 3E-1
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Chapter 4: |
Tax Considerations; And Appendices 4A-4H |
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- § 4:1 : Introduction4-4
- § 4:1.1 : EGTRRA and TRA 2010 Tax Regimes4-8
- [A] : Changes to Prior Tax Regime4-8
- [A][1] : Reduction of Top Rates4-8
- [A][2] : Changes in Exemption Amount4-9
- [A][3] : Portability4-11
- [A][4] : Recapture?4-12
- [A][5] : Deduction for State Death Taxes4-14
- [A][5][a] : Larger Estates—Focus on Effective Top Rate Bracket4-17
- [A][5][b] : Smaller Estates—Focus on Exemption Amount4-19
- § 4:1.2 : Repeal of Qualified Family-Owned Business Deduction4-20
- § 4:2 : Threshold for Imposition of the Federal Estate Tax (the Applicable Credit Amount)4-21
- § 4:2.1 : Amount4-21
- § 4:2.2 : General Considerations4-23
- § 4:2.3 : Tax Structure and Drafting Approaches4-25
- § 4:2.4 : Example of Unified Credit Shelter Trust Formulas4-27
- [A] : Other Credits Against Tax4-28
- [A][1] : State Death Taxes and Impact on Shelter Legacy4-28
- [A][1][a] : Drafting the Formula Shelter Legacy Prior to 20054-29
- [A][1][b] : Drafting the Formula Shelter Legacy After 20054-30
- [A][2] : Planning Pointer4-31
- [A][3] : State Gift Taxes; Gifts Versus Legacies4-33
- [A][4] : Other Credits Against Federal Estate Tax4-33
- [B] : Former Exclusion (Then Deduction) for Portion of Family-Owned Business Repealed4-34
- [C] : Reductions of the Credit Shelter Amount4-35
- [C][1] : Example of Tax on Tax4-36
- [C][2] : Other Reductions4-38
- [D] : Payment of Death Taxes4-38
- § 4:2.5 : General Comments on Unified Credit Formulas4-38
- [A] : Effect of Increases in Unified Credit4-41
- § 4:2.6 : Control Premiums and Minority Discounts—Impact on Credit Shelter Planning4-43
- § 4:2.7 : Formula Clauses in 20104-44
- § 4:3 : Marital Deduction4-45
- § 4:3.1 : Quantitative Limitations—Current Unlimited Marital Deduction4-46
- [A] : Significance of Pre-1982 Limitations on Amount of Marital Deduction4-46
- § 4:3.2 : Qualitative Restrictions4-46
- § 4:3.3 : General Considerations4-47
- § 4:3.4 : Trusts Qualifying for Marital Deduction4-50
- [A] : Traditional Trust; Estate Trust4-50
- [B] : QTIP Trust4-51
- [B][1] : In General4-51
- [B][2] : Additional QTIP Requirements4-52
- [B][2][a] : Distributions to Persons Other Than Surviving Spouse4-52
- [B][2][b] : Power to Elect QTIP Treatment4-53
- [B][2][c] : Conditional QTIP Provisions4-54
- [B][3] : Partial QTIP Election4-55
- [B][3][a] : “Specific Portion” of Trust4-55
- [B][3][b] : Partial Election and Splitting QTIPs: Planning and Drafting4-56
- [B][4] : Planning Opportunity: Fractional Discount Available for QTIP and Probate Assets4-58
- [B][5] : QTIP Trusts: Final-Period Income4-59
- [B][6] : Estate Tax on QTIP Property4-61
- [B][6][a] : Direction in First Testator’s Will or Trust4-62
- [B][6][b] : Provision in Surviving Spouse’s Will or Trust and Protective Statutes4-63
- [B][6][c] : Right of Recovery from QTIP4-63
- [C] : “Traditional” Marital Deduction Trust with General Power of Appointment4-64
- [C][1] : Powers of Appointment and Invasion4-69
- [C][2] : “Specific Portion”4-69
- [D] : Qualified Domestic Trust (QDOT)4-70
- [D][1] : QDOT Requirements4-70
- [D][2] : Sample Qualified Domestic Trust (QDOT) Language4-73
- § 4:3.5 : Provisions Regarding “All the Income” in QTIPs and Traditional Trusts4-77
- § 4:3.6 : Other Marital Deduction Drafting Issues4-81
- [A] : Interest in Unidentified Assets4-81
- [B] : Encumbrances and Obligations4-82
- [C] : Common Disaster and Simultaneous Death4-83
- [D] : Qualifying IRA Assets for QTIP4-88
- § 4:3.7 : Marital Deduction Disallowed4-89
- § 4:3.8 : Floor and Ceiling Clauses4-91
- § 4:3.9 : Relationship of Unified Credit Clauses and Marital Deduction Clauses4-95
- § 4:3.10 : Maximum Marital Deduction Clauses Under Current Law4-95
- § 4:3.11 : Evolution of the Maximum-Minimum (Maxi-Mini) Formulation4-96
- § 4:3.12 : Current and Simpler Marital Deduction Formulas to Minimize Estate Tax4-97
- [A] : Marital Deduction Disclaimer Legacy4-98
- § 4:3.13 : Pecuniary Gifts Versus Residuary (Fractional Share) Gifts4-100
- [A] : Funding the Legacy4-101
- [B] : Leverage in Appreciation or Depreciation4-103
- [C] : Before or in the Residuary Clause4-104
- § 4:3.14 : Adjustments for Tax Elections4-104
- [A] : Impact on the Actual Size of the Marital Legacy4-105
- [B] : Impact on the Size of the Marital Deduction4-105
- [B][1] : Effect of Deduction for Interest on Estate Tax Underpayments4-105
- [B][2] : Effect of Deduction for Other Administration Expenses Paid Out of Income4-106
- [B][2][a] : Revised Regulations Regarding “Estate Transmission” or “Management” Expenses4-107
- [B][2][b] : Planning and Drafting Implications4-107
- § 4:3.15 : Source of Payment of Estate Taxes4-109
- § 4:3.16 : Defined-Value and Value-Adjustment Clauses4-110
- § 4:4 : Generation-Skipping Transfer Tax4-114
- § 4:4.1 : Background and General Observations on the GST Tax4-114
- § 4:4.2 : Structure of the GST Tax4-115
- § 4:4.3 : Exemptions from GST Tax4-117
- [A] : GST Exemption4-117
- [B] : Gift Tax Exclusions Applicable to GST Tax4-118
- [C] : Predeceased Child or Collateral Relative Exception4-119
- [D] : Transfers Subject to Gift or Estate Tax4-121
- [E] : Change of Transferor; Reverse QTIP4-121
- § 4:4.4 : Drafting Aspects of GST4-122
- [A] : Predeceased Relative Exception4-123
- [B] : Allocation of GST Exemption; Splitting Trusts4-123
- [C] : Constructive Addition Issues4-131
- [C][1] : Possible Solutions4-135
- [D] : “Reverse” QTIP Election4-136
- [E] : Reverse QTIP Election for QDOT4-137
- [F] : Granting General Power of Appointment4-138
- [F][1] : Require Consent4-138
- [F][2] : Limit Appointees to Creditors4-139
- [F][3] : Include Self-Destruct Clause4-139
- [F][4] : Trim the Scope of the Power4-140
- [F][5] : Payment of Taxes on Power, Default Provisions, and Coordinating Formulae4-140
- § 4:4.5 : Retreats in Final GST Regulations4-142
- § 4:4.6 : Determination and Payment of GST Tax4-143
- § 4:5 : Estate Taxes: Payment4-147
- § 4:5.1 : Paying Taxes Imposed on Probate Estate or Taxable Estate4-147
- § 4:5.2 : Interrelation of Tax Clauses in Will and Inter Vivos Trust4-152
- § 4:5.3 : Allocation of GST Tax4-153
- § 4:5.4 : Allocation of State Taxes4-154
- § 4:5.5 : Allocation of Tax on Life Insurance4-155
- § 4:5.6 : Allocation Within Residuary Estate4-155
- § 4:5.7 : Composite Model4-156
- § 4:5.8 : Effect of Lifetime Gifts4-157
- [A] : Use of Applicable Credit Amount4-157
- [B] : Effect of Paying Gift Tax4-158
- § 4:6 : Planning for 2010 (and Maybe Beyond): The Carryover Basis Election4-160
- § 4:6.1 : Property to Which the Basis Step-Up May Apply4-161
- § 4:6.2 : Additional Basis Step-Up for Assets Passing to Surviving Spouse4-162
- § 4:6.3 : Exclusion on Gains of Residences4-163
- § 4:6.4 : Allocation of Basis Adjustments4-163
- § 4:7 : Future Uncertainty—General Considerations4-164
- Appendix 4A : Pre-1982 Limitations on Amount of Marital Deduction and Transaction RulesApp. 4A-1
- Appendix 4B : Marital Deduction Formulas to Minimize Estate TaxApp. 4B-1
- Appendix 4C : Estate Taxes: Payment—QTIP ClauseApp. 4C-1
- Appendix 4D : Estate Taxes: Payment; GST Taxes on Outright BequestsApp. 4D-1
- Appendix 4E : GST Tax: Authorization to Allocate ExemptionApp. 4E-1
- Appendix 4F : Authority to Exercise Tax Options and ElectionsApp. 4F-1
- Appendix 4G : Distributions In Kind: Income Tax BasisApp. 4G-1
- Appendix 4H : General Power of Appointment with LimitationsApp. 4H-1
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Chapter 5: |
Special Purpose Trusts; And Appendices 5A-5G |
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- § 5:1 : Introduction5-3
- § 5:2 : Revocable Trusts5-4
- § 5:2.1 : Purposes of Revocable Trusts5-4
- [A] : Avoiding Probate5-4
- [B] : Privacy Concerns5-5
- [C] : Unknown Heirs5-5
- [D] : Taxes5-5
- [E] : Management Vehicle5-6
- [F] : Flexibility5-6
- § 5:2.2 : Execution Formalities5-7
- § 5:2.3 : Transfers to Lifetime Trusts5-8
- § 5:2.4 : Procedural and Dispositive Differences Between Trusts and Wills5-8
- § 5:2.5 : Revocability5-11
- § 5:3 : Grantor Trusts5-12
- § 5:3.1 : Background on Grantor Trust Rules5-12
- [A] : A Word on Nomenclature5-12
- § 5:3.2 : Uses of Intentionally Defective Grantor Trusts5-13
- § 5:3.3 : Methods of Creating Grantor Trust Status5-14
- [A] : Statement of Intent to Be Treated As a Grantor Trust5-14
- [B] : Power of Disposition by Nonadverse Party5-14
- [C] : Power to Add Beneficiaries5-16
- [D] : Power to Substitute Property5-17
- [E] : Power to Lend5-19
- § 5:3.4 : Exit Strategy5-19
- § 5:3.5 : Dealing with the Right of Reimbursement5-21
- § 5:4 : Crummey Power Trusts5-23
- § 5:4.1 : Who May Hold the Power5-24
- § 5:4.2 : What Triggers the Crummey Power?5-26
- § 5:4.3 : Creation of Power5-26
- § 5:4.4 : How Large Should the Power of Withdrawal Be?5-26
- § 5:4.5 : Lapse of the Power5-29
- § 5:4.6 : Hanging Powers5-30
- § 5:4.7 : GST Issue5-31
- § 5:4.8 : Notice5-31
- § 5:4.9 : Minors and Incapacitated Persons5-32
- § 5:4.10 : Modification of Crummey Powers5-33
- § 5:4.11 : Restrictions on Other Distributions5-34
- § 5:5 : Irrevocable Trusts with Retained Discretionary Distribution Rights: Asset Protection and Tax Planning Developments5-35
- § 5:5.1 : Asset Protection Against Creditors of Trust Creator5-35
- § 5:5.2 : Tax Planning and Asset Protection Trusts5-36
- § 5:5.3 : Asset Protection for Beneficiaries5-38
- § 5:5.4 : Disclaimers As a Form of Asset Protection5-38
- § 5:6 : Generation-Skipping Trusts5-39
- § 5:6.1 : Background5-39
- § 5:6.2 : Inter Vivos GST Planning5-40
- § 5:6.3 : Dynasty Trusts5-41
- [A] : Single Pot Approach5-41
- [B] : Stirpital Shares at Each Generation5-41
- [C] : Comparison of the Two Approaches5-42
- § 5:6.4 : Typical Dynasty Trust Dispositive Scheme (Separate Shares)5-42
- § 5:6.5 : Perpetual Term Dynasty Trusts5-44
- [A] : Drafting Flexibility5-46
- § 5:6.6 : Other Dynasty Trust Drafting Matters5-47
- [A] : Consequences of Overfunding5-47
- [B] : Statement of Intention to Create Perpetual Trust5-48
- [C] : Trustee Appointment Provisions5-48
- [D] : Back-Up Perpetuities Provision5-51
- § 5:7 : Insurance Trusts5-52
- § 5:8 : Charitable Split Interest Trusts5-54
- § 5:8.1 : Charitable Remainder Trusts5-54
- [A] : Background5-54
- [B] : Tax Benefits5-55
- [C] : Governing Instrument and Operation of CRT5-56
- [D] : Power to Amend; Statement of Intent5-57
- [E] : Selection of Trustee, Limitation on Powers5-58
- [F] : The Unitrust Payment5-58
- [F][1] : Amount5-58
- [F][2] : Adjustments5-59
- [F][3] : Accelerated CRTs5-59
- [F][4] : Trusts for Financially Disabled Beneficiary As the Current Beneficiary5-60
- [G] : Interest of Successive Beneficiary: Power to Revoke, Estate Tax Concerns5-60
- [H] : Designation of Charitable Recipients5-62
- [I] : Net Income Unitrusts5-63
- [J] : Flip Unitrusts5-65
- [K] : Right of Election Complications for CRTs5-66
- § 5:8.2 : Charitable Lead Trusts5-67
- [A] : General5-67
- [B] : Avoiding Estate Tax Inclusion5-70
- [C] : Generation-Skipping Opportunities5-71
- [D] : Grantor Trust Status5-71
- [E] : Private Foundation As Lead Beneficiary5-74
- [F] : Additional Drafting Considerations5-74
- § 5:9 : Trusts to Hold Stock in S Corporations5-77
- § 5:9.1 : Qualified Subchapter S Trusts (QSSTs)5-78
- [A] : The Single Current Beneficiary Requirement5-79
- [B] : The Trust Termination Requirements5-79
- [C] : The Requirement to Distribute All of the Trust Income5-79
- [D] : Income Taxation of QSSTs5-80
- § 5:9.2 : Electing Small Business Trusts (ESBTs)5-80
- § 5:9.3 : S Stock and Foreign Trusts, Grantors and Beneficiaries5-82
- § 5:10 : Qualified Personal Residence Trusts5-83
- § 5:11 : Grantor Retained Annuity Trusts5-87
- § 5:11.1 : GRAT Spousal Annuities No Longer Work But Are No Longer Needed5-89
- § 5:11.2 : Additional GRAT Details5-92
- § 5:11.3 : Sample Language5-95
- § 5:12 : QTIPs5-95
- § 5:13 : QDOTs5-95
- § 5:14 : Support Trusts and Governmental Programs5-95
- § 5:14.1 : Supplemental Needs Trusts5-97
- § 5:14.2 : Payback Trusts5-100
- § 5:15 : Directed Trusts5-101
- § 5:16 : Silent Trusts5-102
- Appendix 5A : Rights of WithdrawalApp. 5A-1
- Appendix 5B : Life Insurance PoliciesApp. 5B-1
- Appendix 5C : Qualified Personal Residence TrustApp. 5C-1
- Appendix 5D : GRAT ProvisionsApp. 5D-1
- Appendix 5E : Investment AdvisorApp. 5E-1
- Appendix 5F : Distribution AdvisorApp. 5F-1
- Appendix 5G : Administrative TrusteeApp. 5G-1
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Chapter 6: |
Fiduciaries and Administrative Powers; And Appendices 6A-6C |
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- § 6:1 : Designation of Fiduciaries6-3
- § 6:1.1 : Selection of a Trustee6-3
- § 6:1.2 : Formal Qualifications6-4
- § 6:1.3 : Designation of Successor Fiduciaries; Additional Fiduciaries6-6
- § 6:1.4 : Resignation and Removal6-8
- [A] : Situs of Fiduciary6-10
- § 6:2 : Bond6-11
- § 6:3 : Commissions and Fees6-12
- § 6:3.1 : Commissions of More Than Two Fiduciaries6-14
- [A] : Drafting Under the Multiple Commissions Statute6-14
- § 6:3.2 : Commissions of Corporate Fiduciaries6-16
- [A] : New York Executors’ Commissions Legislation6-16
- [B] : New York SCPA Section 2312: Commissions of Corporate Trustees6-18
- [C] : Clauses Regarding Compensation of Corporate Fiduciaries6-18
- § 6:3.3 : Attorney-Fiduciaries6-19
- [A] : Commissions for Attorney-Fiduciary and Employees of Attorney6-20
- [A][1] : The Current SCPA Section 2307-a and Model Disclosure Agreement6-21
- [A][2] : Problems Caused by the 2004 Amendments to SCPA Section 2307-a6-23
- [A][3] : Execution Formalities for Disclosure Agreements6-24
- [A][4] : When a Disclosure Agreement Is Not Required6-27
- [B] : Executors’ Commissions for Attorneys; Multiple Commissions6-29
- [C] : Attorney As Beneficiary6-30
- [D] : Calculation of Attorneys’ Fees6-31
- [E] : Legal Disbursements6-32
- § 6:3.4 : Deductibility of Investment Advisory Fees6-33
- [A] : Proposed Regulations6-34
- § 6:4 : Unanimous or Nonunanimous Decisions and Acts6-35
- § 6:4.1 : Directed Trustees6-36
- § 6:5 : Business Associates of Testator6-37
- § 6:6 : Special Business or Property Situations of Testator6-38
- § 6:7 : Exculpatory Clause6-41
- § 6:8 : Appointment of Guardians6-43
- § 6:8.1 : Standby Guardians in New York6-44
- § 6:9 : Administrative Powers of Executors and Trustees6-45
- § 6:9.1 : Introductory Clause6-47
- § 6:9.2 : Retention6-49
- § 6:9.3 : Investment6-50
- [A] : Evolution of Trustee Investment Standard Through 19706-51
- [B] : Prudent Person Rule (1970 Through 1995)6-51
- [C] : Unwise Drafting Restrictions on Investment (Beware of Bad Precedents)6-52
- [D] : Prudent Investor Act—1992 to Date6-53
- [D][1] : New York’s Version of the Prudent Investor Act (1994)6-54
- [D][1][a] : Current Standard of Conduct6-55
- [D][1][b] : Specific Duties Under the New Statute6-56
- [D][2] : Drafting Approaches Under the New Statute6-58
- [D][2][a] : Invasions; Income and Principal6-58
- [D][2][b] : Annuities and Unitrusts6-60
- [D][3] : The Trustee’s Duty to Diversify Assets6-64
- [D][3][a] : The Balance Between the Duty to Diversify and the Testator’s Wishes6-65
- [D][3][b] : Diversification and Market Pressures6-68
- [D][3][c] : Diversification and Hindsight Liability6-69
- [D][3][d] : Drafting Guidelines6-70
- [D][4] : Retention of Initial Portfolio6-73
- [D][5] : Additional Powers Under the New Statute6-74
- [D][6] : Delegation of Investment and Management Functions6-75
- [E] : The Final “Income” Tax Regulations and Total Return Legislation6-77
- [E][1] : The Tax Questions the Final Regulations Were Intended to Address6-78
- [E][2] : The Effective Dates for the Final Regulations6-78
- [E][3] : How the Final Regulations Address the Tax Issues6-79
- [E][3][a] : Definition of “Income”6-79
- [E][3][b] : Mandatory versus Permissive Statutes6-80
- [E][3][c] : Capital Gains and Distributable Net Income6-81
- [E][3][d] : Marital Deduction Trusts6-81
- [E][3][e] : Grandfathered GST Tax Exempt Trusts6-82
- [E][3][f] : Charitable Remainder Trusts6-82
- [E][3][g] : Pooled Income Funds6-83
- [E][4] : Distinctions Between the Final Regulations and the Proposed Regulations6-83
- [E][5] : Open Issues6-83
- § 6:9.4 : Other Provisions Relating to Investments6-84
- § 6:9.5 : Lending6-86
- § 6:9.6 : Sale6-86
- § 6:9.7 : Mortgage, Lease, Repairs6-86
- § 6:9.8 : Borrowing6-88
- § 6:9.9 : Renewing Obligations; Settling and Arbitrating Claims6-88
- § 6:9.10 : Voting Rights, Reorganizations6-89
- § 6:9.11 : Distribution in Kind6-90
- § 6:9.12 : Dividends6-91
- § 6:9.13 : Amortization6-91
- § 6:9.14 : Consolidated Investments6-92
- § 6:9.15 : Services of Others6-93
- § 6:9.16 : Accumulations, Powers in Trust6-94
- § 6:9.17 : Authority After Trusts Terminate6-94
- § 6:9.18 : Administrative Provisions in Absence of Trusts6-95
- § 6:9.19 : Pourover or Decanting Powers6-95
- [A] : New York Decanting Statute6-96
- [B] : 2011 Amendments to the New York Decanting Statute6-98
- [C] : Model Pourover/Decanting Language6-100
- § 6:10 : Duties of Executors and Trustees6-101
- § 6:10.1 : The New York Model6-101
- § 6:10.2 : The Uniform Codes6-102
- Appendix 6A : Designating New York Standby GuardianApp. 6A-1
- Appendix 6B : Definition of Executor and Trustee; No Bond; AccountsApp. 6B-1
- Appendix 6C : Administrative Powers for Executors: Compact Alternative (Where No Trusts Are In Will)App. 6C-1
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Chapter 7: |
Other Estate Planning Documents; And Appendices 7A-7U |
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- § 7:1 : General Considerations7-3
- § 7:2 : Testamentary Substitutes7-3
- § 7:2.1 : Life Insurance and Pension Plans7-3
- § 7:2.2 : Joint Property7-4
- § 7:2.3 : Bank Accounts and Securities7-6
- [A] : Bank Accounts7-6
- [B] : Securities7-8
- [C] : Considerations for the Drafter7-9
- § 7:2.4 : Usefulness of Inter Vivos Trusts: Privacy, Incapacity7-10
- § 7:3 : Durable Powers of Attorney7-11
- § 7:3.1 : Varieties of Powers of Attorney7-14
- § 7:3.2 : Power of Attorney Statutes7-17
- [A] : Statutory Forms and Drafting Considerations7-17
- [B] : New York Power of Attorney Statute7-19
- [B][1] : Statutory Short-Form Power of Attorney7-21
- [B][2] : Gifts and Certain Gift Transactions7-21
- [B][3] : Fiduciary Duties of Agent7-22
- [B][4] : HIPAA Privacy Rule7-22
- [B][5] : Reasonable Refusal of Power of Attorney7-22
- [B][6] : The 2010 Technical Amendments7-22
- § 7:3.3 : Special Powers: Making Gifts and Amending Trusts7-23
- [A] : Gifts Under Durable Power7-23
- [B] : Amending Trusts7-27
- § 7:3.4 : Execution and Other Considerations7-28
- § 7:4 : The Living Will and Health Care Proxy7-31
- § 7:4.1 : Court Decisions7-31
- § 7:4.2 : Drafting the Living Will and Health Care Proxy7-34
- [A] : Drafting Guidelines7-35
- [B] : Choice of Health Care Agent7-36
- [C] : Providing Instructions for the Health Care Agent7-37
- [D] : Specific Types of Living Wills7-38
- § 7:4.3 : Federal Legislation; HIPAA7-39
- § 7:4.4 : New York Health Care Agents7-42
- [A] : Overview of Health Care Proxy Statute7-43
- [B] : General Standard Health Care Agents Use to Make Decisions7-45
- [C] : 2010 Family Health Care Decisions Act7-47
- § 7:5 : Organ Dispositions7-48
- § 7:6 : Appointment of Agent to Control Disposition of Remains7-48
- Appendix 7A : Power of Attorney—New York Statutory Short FormApp. 7A-1
- Appendix 7B : New York Statutory Gifts Rider—Authorization for Certain Gift TransactionsApp. 7B-1
- Appendix 7C : Non-statutory Power of Attorney—Including Authorization for Certain Gift TransactionsApp. 7C-1
- Appendix 7D : New York Combined Health Care Proxy and Medical DirectiveApp. 7D-1
- Appendix 7E : New York Medical Directive (No Health Care Proxy)App. 7E-1
- Appendix 7F : New York Health Care Proxy (No Medical Directive)App. 7F-1
- Appendix 7G : New York State Department of Health Health Care Proxy Instructions, Explanations, and FormApp. 7G-1
- Appendix 7H : The Medical Directive (and Health Care Proxy) Developed by Dr. EmanuelApp. 7H-1
- Appendix 7I : The Halachic Living Will (Including Proxy)App. 7I-1
- Appendix 7J : New Jersey Proxy Directive—(Durable Power of Attorney for Health Care) Designation of Health Care RepresentativeApp. 7J-1
- Appendix 7K : New Jersey Combined Advance Directive for Health CareApp. 7K-1
- Appendix 7L : New Jersey Instruction Directive—(Without Proxy)App. 7L-1
- Appendix 7M : Connecticut Form Concerning Health Care and Withholding or Withdrawal of Life Support SystemsApp. 7M-1
- Appendix 7N : Connecticut Health Care Instructions FormApp. 7N-1
- Appendix 7O : Florida Living WillApp. 7O-1
- Appendix 7P : Florida Designation of Health Care SurrogateApp. 7P-1
- Appendix 7Q : Illinois Declaration Regarding Health CareApp. 7Q-1
- Appendix 7R : Illinois Statutory Short Form Power of Attorney for Health CareApp. 7R-1
- Appendix 7S : California Advance Health Care DirectiveApp. 7S-1
- Appendix 7T : Georgia Advance Directive for Health CareApp. 7T-1
- Appendix 7U : New York Appointment of Agent to Control Disposition of RemainsApp. 7U-1
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Chapter 8: |
The Lawyer's Legal and Ethical Duties |
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- § 8:1 : Introduction8-2
- § 8:1.1 : Reasons for Concern8-3
- § 8:2 : Ethical Duties8-3
- § 8:2.1 : Conflicts of Interest in Estate Planning and Administration8-4
- [A] : Lawyer As Beneficiary or Fiduciary8-5
- [B] : Potential Conflicts of Interest Between Clients8-5
- [B][1] : Spouses8-5
- [B][2] : Beneficiary and Testator8-7
- [B][3] : Beneficiary and Fiduciary8-8
- § 8:2.2 : Other Ethical Issues8-10
- [A] : Dormant Representation8-10
- [B] : Lawyer As Intermediary8-10
- § 8:2.3 : Letters of Engagement8-10
- § 8:3 : Legal Duties and Malpractice8-11
- § 8:3.1 : Privity: The Historic Barrier to Malpractice Liability8-12
- § 8:3.2 : Contemporary Cases8-14
- § 8:4 : Drafting Defects8-17
- § 8:4.1 : Types of Defects8-17
- [A] : Errors in Transcription8-18
- [B] : Ambiguities8-19
- [C] : Tax Problems8-20
- [D] : Unanticipated Changes in Facts8-22
- § 8:4.2 : Factors to Consider When Undertaking Representation8-22
- [A] : Sufficiency of Administrative Support8-23
- [B] : Degree of Expertise Required8-23
- [C] : Availability of Relevant Facts8-23
- [D] : Availability of Reformation and Other Remedies8-24
- § 8:5 : Execution Errors8-25
- § 8:5.1 : Types of Errors8-26
- [A] : Signing Errors8-27
- [B] : Number and Qualifications of Witnesses8-29
- [C] : Other Execution Errors8-31
- § 8:5.2 : Assessing the Risk of Malpractice8-32
- § 8:5.3 : Situation-Specific Impediments to Execution8-34
- § 8:6 : Claims Based on Common Law Doctrines Affecting Validity of an Instrument8-34
- § 8:6.1 : Testamentary Capacity8-35
- § 8:6.2 : Undue Influence8-38
- § 8:6.3 : Fraud8-39
- § 8:6.4 : Factors to Consider When Undertaking Representation8-40
- [A] : New Client or New Matter8-40
- [B] : Experience Dealing with Questionably Competent Clients8-40
- [C] : Continuing Obligations to Client8-41
- § 8:7 : Protective Measures to Avoid Malpractice Liability8-41
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Chapter 9: |
Table of Authorities |
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Chapter 10: |
Index to Stocker and Rikoon on Drawing Wills and Trusts |
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