{"id":348,"date":"2022-07-18T14:02:16","date_gmt":"2022-07-18T14:02:16","guid":{"rendered":"https:\/\/www.yadgarovalaw.com\/epub\/?p=348"},"modified":"2022-07-18T14:06:43","modified_gmt":"2022-07-18T14:06:43","slug":"trust-v-will-difference-between-a-trust-and-a-will","status":"publish","type":"post","link":"https:\/\/www.yadgarovalaw.com\/epub\/2022\/07\/18\/trust-v-will-difference-between-a-trust-and-a-will\/","title":{"rendered":"Trust v Will &#8211; Difference Between a Trust and a Will"},"content":{"rendered":"<p><iframe loading=\"lazy\" width=\"525\" height=\"295\" src=\"https:\/\/www.youtube.com\/embed\/3d_VKqoj7_0?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture\" allowfullscreen title=\"Will v  Trust\"><\/iframe><\/p>\n<p>Pros, cons and differences between a Trust and a Will<!--more--><\/p>\n<p>Irina Yadgarova, Michael Levitis<\/p>\n<p>Michael Levitis 00:00<br \/>\nHey everybody, this is Michael Levitis from JurisQ.com, a legal network and I am bringing back. Irina Yadgarova, a Medicaid and estates attorney. Hi Irina. Welcome back. Thank you for your time.<br \/>\nIrina Yadgarova 00:18<br \/>\nHello, how are you?<br \/>\nMichael Levitis 00:19<br \/>\nVery good. Thank you. Last time we spoke, you did an excellent job explaining what you do, how to<br \/>\nqualify for Medicaid. But still some questions remain some more basic issues that I want to get into.<br \/>\nYou know, a lot of people get confused when they hear a wil,l a trust. What is the difference between<br \/>\nthem? If you have a trust do you need a will? If you have a will do you need a trust? What&#8217;s easier to<br \/>\ndeal with when unfortunately, somebody passes away? What&#8217;s the easiest form to get the inheritance<br \/>\nthrough which mechanism? A will? A trust?<br \/>\nIrina Yadgarova 00:58<br \/>\nYes, those are excellent questions. I get asked that all the time. And they are very different a trust and a<br \/>\nwill, any trusts will actually avoid what you will have to go through with a will. So whether or not you<br \/>\nhave a will, there is a court process that the state has to go through before your beneficiaries inherit<br \/>\nanything. So if there is a will, that process is called probate and the surrogates court, if you don&#8217;t have a<br \/>\nwill, it&#8217;s administration and the surrogates court. So a basic impetus for doing a will even though you<br \/>\nstill have to go through the court process is you get to decide where your property goes when you die.<br \/>\nThis state has a statute. So if you don&#8217;t say it in this written instrument, the will the state decides who<br \/>\ninherits. And it goes in order of your nearest kin. And each state has a different statute. So for example,<br \/>\nin New York, the nearest relatives if you&#8217;re married, your spouse, and if you have children, your spouse<br \/>\ngets the first $50,000 plus one half of your estate, and the children get the rest and equal shares. If you<br \/>\ndon&#8217;t have children, your spouse gets everything. If you&#8217;re not married, and you have children, your<br \/>\nchildren get an equal share. So if you have no children, your parents, so then the statute goes in levels<br \/>\nof succession, who is your nearest kin, so if you have children, for example, but you don&#8217;t want them to inherit equally, let&#8217;s say you have a house or an account, or any asset that is just titled in your name will<br \/>\nhave to go through this court process. So in your will, you can say, I don&#8217;t want, you know, one of my<br \/>\nchildren to get anything, I don&#8217;t have a good relationship with him, I want the others to inherit, you<br \/>\nknow, in either equal shares or whatever disposition you want. Or if you want to give some to charity, or<br \/>\na friend, no one, you know, then the statue will operate unless you have a will. So that in itself is a<br \/>\ngreat motivation to have a will if you don&#8217;t want the state to decide the disposition of your property.<br \/>\nMichael Levitis 02:53<br \/>\nBut that process that sounds lengthy and could be expensive.<br \/>\nIrina Yadgarova 02:58<br \/>\nSo probate is a little bit better, right? It&#8217;s a step up from the administration in terms of length and cost.<br \/>\nAnd I&#8217;ll explain that. So you&#8217;re not avoiding a court process here. Unfortunately, the probate process is<br \/>\ntaking, depending on the county, I&#8217;m saying I think you&#8217;re looking at for my experience in various<br \/>\ncounties an average of about six months, at least. And this is like a very optimistic view. For example,<br \/>\nin Kings County, the petitions literally sit there for months and months before the surrogate judge gets<br \/>\nto look at them. Why?\u00a0 It&#8217;s not because they&#8217;re lazy or incompetent is because there&#8217;s such a backlog, not<br \/>\njust because of COVID. So pre COVID, there was still you&#8217;re looking at minimum six months time, post<br \/>\nCOVID. Of course, there&#8217;s still been this pent up delay. So now they&#8217;re kind of getting back up to speed.<br \/>\nBut even then there&#8217;s one here, one judge, one surrogate for every county, and for every person whose<br \/>\nestate has to be administered or guardianship, you have one judge, they have their clerks, but it&#8217;s a<br \/>\nvery, very busy docket.<br \/>\nMichael Levitis 04:03<br \/>\nSo if your loved one passed away, unfortunately, and you have that to deal with you were expecting<br \/>\ncounting on this inheritance, you may have to wait six months and longer.<br \/>\nIrina Yadgarova 04:17<br \/>\nBecause probates and administrations most of the time they have some sort of kinks. They&#8217;re not as<br \/>\nsimple as you think. Because you have to set you have to notify and cite the nearest kin, even in a will.<br \/>\nThere&#8217;s no privacy there. So if there is a minor Oh, my goodness, they have to appoint a guardian ad<br \/>\nlitem of a minor beneficiary and these things take years years. So I&#8217;m literally saying optimistic six<br \/>\nmonths.<br \/>\nMichael Levitis 04:41<br \/>\nIrina, sometimes, I believe, your sibling or somebody else can contest. What&#8217;s happening in that case?<br \/>\nIrina Yadgarova 04:49<br \/>\nYeah. That&#8217;s why they&#8217;re given the right to be cited. Yes.<br \/>\nMichael Levitis 04:53<br \/>\nIt could be a whole litigation that could take years to decide.<br \/>\nIrina Yadgarova 04:58<\/p>\n<p>That example that I gave a little bit early. Do you want to disinherit your son and the will? Well guess<br \/>\nwhat? That son is gonna get note he has to get notice of that will and a copy. And if he&#8217;s not happy if he<br \/>\nthinks mom was under duress or had dementia at the time she signed, and he&#8217;s gonna be contesting it,<br \/>\nhe has another copy of some other instrument. So a trust avoids all of these. Avoiding Probate is one advantage<br \/>\nof doing a trust, of course, and the cost because you mentioned, you know, definitely, it&#8217;s expensive, it&#8217;s<br \/>\nvery expensive. So, for the attorneys fees, you&#8217;re looking at thousands of dollars, the court fee is based on<br \/>\nthe value of the estate, the highest court fee for any estate, a half a million or over is $1,250. You&#8217;re<br \/>\nlooking at a court fee, okay? A lawyer&#8217;s fee. And I&#8217;ve seen attorneys who do charge percentages of the<br \/>\nestate, I&#8217;ve seen 3% 6%.<br \/>\nMichael Levitis 05:50<br \/>\nit&#8217;s like a trustee, right?<br \/>\nIrina Yadgarova 05:53<br \/>\nThe attorney who does the probate who they aren&#8217;t sometimes they charge percent of the estate, I&#8217;ve\u00a0seen it on multiple occasions. So they&#8217;e, you know, apparently, I guess it&#8217;s something that would be<br \/>\nupheld in a challenge of attorneys fees, they do sometimes charge a percentage of the estate value. So<br \/>\nthat very hefty if you&#8217;re looking at your rental property is worth at least a million dollars in many areas in<br \/>\nNew York, so three to six are just to pay the lawyer to deal with the probate.<br \/>\nMichael Levitis 06:22<br \/>\nAnd what about a trustee? Don&#8217;t you need a trustee as well?<br \/>\nIrina Yadgarova 06:25<br \/>\nAn executor? Yes, whoever who is going to administer they marshal all the assets and distribute them<br \/>\nto the beneficiaries that you will point them in your will, which again, is another advantage you get?<br \/>\nYes, they administer exact they have fees, administrators and executives have a statutory rate of fees,<br \/>\nwhich you can circumvent in the Will you could do more or less depending on what you want. There&#8217;s\u00a0also\u00a0 a percentage schedule.<br \/>\nMichael Levitis 06:51<br \/>\nYes. Okay. Very good now, but if you create a trust ahead of time, and I know your office does that, can<br \/>\nyou explain a little bit how that works, and how that makes the process more painless.<br \/>\nIrina Yadgarova 07:07<br \/>\nOkay, so I think it&#8217;s very important to understand that the only assets that are going to pass through a<br \/>\nwill are those that are titled in your name. So any asset that you properly transfer into a trust is no<br \/>\nlonger titled in your name, and will not go through that court process of probate or administration, that<br \/>\nwill have nothing to do with it. So when you have a trust, it&#8217;s important not just to have a blank<br \/>\ninstrument that trust, you have to transfer either the account that you want to pass through the trust and<br \/>\nto the name of it, or the real property, whatever assets you want to pass pursuant to the trust, you have<br \/>\nto retitle in the name of the trust. That way, those assets will not go through any court process, they will<br \/>\npass automatically. Post your passing. So that&#8217;s a huge savings and time and cost and headache and privacy. That&#8217;s a very important concern. Of course, a long time in practice, the more I see all these<br \/>\ncomplications with probate processes.<br \/>\nMichael Levitis 08:05<br \/>\nThat&#8217;s an interesting point that you don&#8217;t think about. Right? Yeah, yeah, especially in this day and age.<br \/>\nWe talked in our prior videos, how through a trust, you can qualify for Medicaid. Right. So certainly, you<br \/>\ncan save lots of money for your medical expenses.<br \/>\nIrina Yadgarova 08:24<br \/>\nYes, trusts can have so many advantages that wills do not trust can function in the form of Medicaid<br \/>\neligibility. Trust can function similarly to get you asset protection. And trust can also help you avoid or<br \/>\nminimize estate taxes, depending on your net worth, which may be a very large concern. So trust are<br \/>\nvehicles that we use, in many instances, they may not be appropriate for everyone. I just want to also<br \/>\nmention something super important because we&#8217;re talking about the complexity of probate. Probate is<br \/>\neven more cumbersome and very difficult when you have properties and multiple jurisdictions. Why?<br \/>\nBecause if you live if you&#8217;re living in New York, and you have property in New York, but you have<br \/>\nproperty as well in Florida, and you know, Pennsylvania, right, so many people have properties and<br \/>\nmultiple jurisdictions, even a vacation home, right, but you&#8217;re gonna need to do ancillary probate or if<br \/>\nyou didn&#8217;t have a real ancillary administer your attorney. Yes. That gets very costly. Multiple<br \/>\njurisdiction always triggers for me do a trust in order to avoid those, you know, and have all the right<br \/>\ntrust sometimes, again, depending on the nature of the property, if it&#8217;s just a bank account, this is<br \/>\nprobably the most useful advice that I can give everyone and it won&#8217;t cost you a penny -appoint a<br \/>\nbeneficiary, a transfer on death beneficiary on your bank account, because instead you don&#8217;t need to<br \/>\ndo a trust for a bank account. It will be similar to a life insurance or retirement account. Name a<br \/>\nbeneficiary that way the account doesn&#8217;t have to go through any court process, you don&#8217;t need a trust for it. There&#8217;s many<br \/>\nother reasons you may consider doing a trust for those properties. But if your sole concern is avoidance<br \/>\nof probate, for many assets, you can accomplish that without having to do a trust just by retitling and<br \/>\nadding a beneficiary designation to even a checking account.<br \/>\nMichael Levitis 10:20<br \/>\nIrina, you know, my biggest takeaway here, after I heard you explain, but all the complexities about<br \/>\nwhat happens when somebody passes away, you think you find peace? No. There&#8217;s more headache.<br \/>\nIrina Yadgarova 10:38<br \/>\nYour, well, you know, your nearest kin, your loved ones would have the rest of the headings planning<br \/>\nbeneficial for them.<br \/>\nMichael Levitis 10:45<br \/>\nThat&#8217;s what I was getting at that it sounds like you have to go to an attorney who is knowledgeable who<br \/>\ndoes just this trust and estates, retirement planning. And take all your assets, take everything you have<br \/>\nbank accounts, houses, accounts, businesses. Think about all your relationships, about all your kids,<br \/>\nlegitimate and illegitimate. Think about your wives, your ex wives, your future wives, and you have to<br \/>\nhave somebody like Irina Yadgarova to map it out for you. All in, in different documents, instruments,<br \/>\nsays when you pass on your cane, have a peace of mind and make it easy for them to move on.<\/p>\n<p>Irina Yadgarova 11:36<br \/>\nAbsolutely. Couldn&#8217;t agree more.<br \/>\nMichael Levitis 11:39<br \/>\nIrina, thank you so much. This was very informative, of course, what you heard here today. That&#8217;s just<br \/>\ngeneral advice Irina gave for you a broad landscape. If you want specific consultation on your specific<br \/>\nsituation, call the number on the bottom of the screen. Go early, don&#8217;t delay. Everybody. Thank you<br \/>\nvery much. Thank you everyone for your time.<br \/>\nIrina Yadgarova 12:08<br \/>\nThank you, Mike.<\/p>\n<p>SUMMARY KEYWORDS<br \/>\ntrust,\u00a0 probate, court, assets, estate, beneficiary, property, process, nearest kin, administer,<br \/>\ninstrument, attorney, pass, depending, fee, multiple jurisdictions, months, attorneys fees, bank account<br \/>\nSPEAKERS<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Pros, cons and differences between a Trust and a Will<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/posts\/348"}],"collection":[{"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/comments?post=348"}],"version-history":[{"count":3,"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/posts\/348\/revisions"}],"predecessor-version":[{"id":351,"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/posts\/348\/revisions\/351"}],"wp:attachment":[{"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/media?parent=348"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/categories?post=348"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.yadgarovalaw.com\/epub\/wp-json\/wp\/v2\/tags?post=348"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}