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TruthSeeker315

Significance of this paragraph in a will

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In laymen terms is there a significance to this paragraph?

 I direct that all estate, transfer, succession, and similar taxes or duties, including interest and penalties

thereon, whether they may be imposed with respect to any property or interest passing under this will,

or otherwise, shall be charged against the principal of my residuary estate and treated as an

expense of administering my estate.

 

 

Alot of accounts pass outside of probate. 

Can one direct that expenses be taking out of joint accounts that were left to a administrator to pay my bills if need be.

Or is that just something you have to trust your administrate will do fairly?

 

Thanks

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The quoted paragraph essentially only applies to payment of taxes.  It has nothing to do with payment of bills. 

 

A joint account passes to the designated joint tenant and is not liable to the bills of the decedent unless the estate is insufficient to pay the final bills and a creditor takes the time and effort to surcharge the joint account.  You should not assume the joint owner will use the joint funds to pay the estate bills since the joint owner may decide not to do so and that would work against the intended interest of the legatees.

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1 hour ago, TruthSeeker315 said:

In laymen terms is there a significance to this paragraph?

 

I'm not sure what "laymen terms" might mean, but of course there's a significance to the paragraph you quoted.  It seems pretty obvious to me, but is there something you don't understand?

 

 

1 hour ago, TruthSeeker315 said:

Can one direct that expenses be taking out of joint accounts that were left to a administrator to pay my bills if need be.

 

One "can direct" anything one likes, but assets that pass outside of probate are not available for payment of estate debt.

 

 

1 hour ago, TruthSeeker315 said:

Or is that just something you have to trust your administrate will do fairly?

 

I don't really know what this might mean.

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Thank you, And that would be only if there are any estate taxes. Not likely in most cases of a smaller probate estate with only a home, but still a substantial amount of money over all. 

 

When a Testator does not communicate to their financial adviser and Vice versa,  they have changed things in their will, the financial adviser can have a half picture of the Testator true and equitable intent. 

 

 

 

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1 hour ago, pg1067 said:

 

I'm not sure what "laymen terms" might mean, but of course there's a significance to the paragraph you quoted.  It seems pretty obvious to me, but is there something you don't understand?

 

 

 

One "can direct" anything one likes, but assets that pass outside of probate are not available for payment of estate debt.

 

 

 

I don't really know what this might mean.

You give your one son the responsibility to have access to these joint accounts for a purpose if the need arises, you pass suddenly, your intent is truly what you have in your WILL. Now my one son starts to think he is entitled to all I have left him in those joint accounts. When my intent is only to give him access to them if he needs to act on my behalf.  But I expect him to share my estate as a whole per my WILL.  It is a divide between legalities and moralities. trying to accomplish that seems complicated for us the mere mortals. 

 

laymen terms= plain common people language. I'm glad it seems obvious to you, but that does not mean it may be obvious to all.

 

 

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You should not make your son joint owner of the account if your sole intent is for him to manage your affairs if you become disabled or incometent.  Making him joint owner of the account is making  a gift of the account to him.  You should execute a power of attorney allowing him to act for you rather than turning over your assets to him.  Legality and morality aside, once you are dead you do not control what your son does with the property you gave him before you died, namely the funds in the joint account.  Similarly, if you have designated your son, or anyone else, beneficiary of an insurance policy, brokerage account, pension, 401(K), etc. expecting those assets be be treated as part of your estate, you are possibly making a mistake.  They are not part of the estate unless the beneficiary is the executor of the estate. 

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2 hours ago, RetiredinVA said:

They are not part of the estate unless the beneficiary is the executor of the estate. 

could you please elaborate. if he is a beneficiary of my Will and he is the appointed executor in my Will ?

I may be miss understanding this.

 

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2 hours ago, TruthSeeker315 said:

And that would be only if there are any estate taxes.

 

I'm not sure what the antecedent of "that" is in this sentence.  However, even if no estate taxes are due, other taxes may be due (e.g., personal income taxes for the decedent for the year in which he/she died).

 

 

1 hour ago, TruthSeeker315 said:

You give your one son the responsibility to have access to these joint accounts for a purpose if the need arises, you pass suddenly, your intent is truly what you have in your WILL. Now my one son starts to think he is entitled to all I have left him in those joint accounts. When my intent is only to give him access to them if he needs to act on my behalf.  But I expect him to share my estate as a whole per my WILL.  It is a divide between legalities and moralities. trying to accomplish that seems complicated for us the mere mortals.

 

Huh?  I'm not sure why the first part of this is written in the second person and then you shifted to the first person.  In any event, if you want someone to have access to money in a bank account but want the money in the account to remain as part of your estate when you die, then adding the other person as a joint account holder is the wrong way to accomplish that intent.  If T has money in a bank account and adds S as a joint account holder and then dies, the money in the account belongs to S, regardless of what T's will says.  Courts do not try to delve into the "intent" of a deceased person when the deceased's purported intent is contrary to the deceased person's actions.

 

 

1 hour ago, TruthSeeker315 said:

laymen terms= plain common people language. I'm glad it seems obvious to you, but that does not mean it may be obvious to all.

 

I'm quite aware.  That's why I asked if "there [was] something you don't understand."

 

 

17 minutes ago, TruthSeeker315 said:
1 hour ago, RetiredinVA said:

They are not part of the estate unless the beneficiary is the executor of the estate.

 

could you please elaborate. if he is a beneficiary of my Will and he is the appointed executor in my Will ?

I may be miss understanding this.

 

I may also be misunderstanding what "RetiredinVA" wrote because, as phrased, I disagree with the "unless" part of the quoted sentence.

 

When "RetiredinVA" wrote that "[t]hey are not part of the estate," he was referring to "funds in [a] joint account, . . . [the proceeds] of an insurance policy, [and funds in a] brokerage account, pension, 401(K), etc." (if there is a designated pay-on-death beneficiary.  In the absence of an unusually worded account agreement, funds in a joint account pass to the surviving owner when one of the owners dies and are not part of the deceased owner's estate.  Similarly, when there is a designated beneficiary, the proceeds of a life insurance policy and funds in brokerage and retirement accounts belong to the designated beneficiary and are not part of the estate.

 

The "unless" portion "RetiredinVA's" response puzzles me because it says that, if the designated beneficiary happens to be the executor of the estate, then the above-mentioned assets are part of the estate.  If that's what was intended, then I disagree, but I'll leave it to "RetiredinVA" to clarify.

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2 hours ago, pg1067 said:

The "unless" portion "RetiredinVA's" response puzzles me because it says that, if the designated beneficiary happens to be the executor of the estate, then the above-mentioned assets are part of the estate.  If that's what was intended, then I disagree, but I'll leave it to "RetiredinVA" to clarify.

When I stated that the assets of an account that requires or allows the designation of a beneficiary becomes a part of the decedent's estate when the designated beneficiary is the executor of the estate I meant the designated beneficiary is "X as executor my estate", not when the designated beneficiary also happens to be the nominated executor.  It is much safer to simply designate the beneficiary as "the executor of my estate" rather than naming a specific person.

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55 minutes ago, RetiredinVA said:

When I stated that the assets of an account that requires or allows the designation of a beneficiary becomes a part of the decedent's estate when the designated beneficiary is the executor of the estate I meant the designated beneficiary is "X as executor my estate", not when the designated beneficiary also happens to be the nominated executor.  It is much safer to simply designate the beneficiary as "the executor of my estate" rather than naming a specific person.

 

Got it.  I've never seen it where the beneficiary was named as "[name], as executor of my estate."  Rather, I've seen it where the estate is designated as beneficiary.  Same effect, although I think designating a specific person "as executor" could create a problem if the designated person is not, in fact, appointed as the executor.

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3 hours ago, pg1067 said:

 

Huh?  I'm not sure why the first part of this is written in the second person and then you shifted to the first person.  In any event, if you want someone to have access to money in a bank account but want the money in the account to remain as part of your estate when you die, then adding the other person as a joint account holder is the wrong way to accomplish that intent.  If T has money in a bank account and adds S as a joint account holder and then dies, the money in the account belongs to S, regardless of what T's will says.  Courts do not try to delve into the "intent" of a deceased person when the deceased's purported intent is contrary to the deceased person's actions.

 

 

Partially because I am trying to update/create my own Will on one hand, while currently the beneficiary to my last parent passing recently. While trying to understanding the extent of how far off equitably one document is in relation to the others.  And to make it even worse, Will changes were made to my last parents Will, that included some stated wishes for grandchilds future college plans (a minor)

 

And no offense to lawyers intended here, but their language is not that easy for common folk to understand. And sometimes when a individual asks to many questions, in order to better understand, to what extent their actions can have, I think lawyers get frustrated with us lay persons. 

 

 

While talking to other friends about how they have theirs set up, I see this one sidedness of accounts, yet they tell me it is being left to the one with the most(executor) to do the sharing with the rest of the beneficiaries. Most of these friends are of generation way before me.

 

 

The below statement of how these accounts can go array of your intent if the plan is not made as a "whole"

“Unfortunately, people often don’t realize that certain assets, such as retirement accounts, life insurance policies, and annuities, pass to their beneficiaries by contract and not under the provisions of their will or trust,”

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3 minutes ago, TruthSeeker315 said:

I am trying to update/create my own Will on one hand, while currently the beneficiary to my last parent passing recently.

 

Not really sure what these two things have to do with each other.

 

 

4 minutes ago, TruthSeeker315 said:

While trying to understanding the extent of how far off equitably one document is in relation to the others.

 

The others?  As in other documents?  What other documents?

 

 

5 minutes ago, TruthSeeker315 said:

While talking to other friends about how they have theirs set up, I see this one sidedness of accounts, yet they tell me it is being left to the one with the most(executor) to do the sharing with the rest of the beneficiaries.

 

Sometimes folks will leave money to one person with the intent -- not stated in the will -- that the recipient of the money will share it with others.  Sometimes a person who receives money under such circumstances will follow that intent, but that doesn't always happen, and the point we're making is that, if you don't follow the legally correct procedure, what you intend to happen might not actually happen.

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The law is designed to make sure the wishes of the testator are fulfilled, regardless of the good will of the survivors.  You would be surprised how often the person who the decedent trusted to distribute the assets decides not to respect the wishes of the decedent.  I suspect that sort of thing happens more often when the decedent decides he didn't need to have an attorney prepare the will.

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1 hour ago, pg1067 said:

 

Not really sure what these two things have to do with each other.

I'm not sure why the first part of this is written in the second person and then you shifted to the first person.

   An explanation in shift for one

1 hour ago, pg1067 said:

 

The others?  As in other documents?  What other documents?

the WILL vs checking, savings, ins, IRA, pensions, etc.....whichever apply

1 hour ago, pg1067 said:

  Courts do not try to delve into the "intent" of a deceased person when the deceased's purported intent is contrary to the deceased person's actions.

 

 

Sometimes folks will leave money to one person with the intent -- not stated in the will -- that the recipient of the money will share it with others.  Sometimes a person who receives money under such circumstances will follow that intent, but that doesn't always happen, and the point we're making is that, if you don't follow the legally correct procedure, what you intend to happen might not actually happen.

Correct, and the point I am making is that banks, financial advisers, lawyers can give wrong/complex information where in communication breakdown, if/when misunderstood information leads to actions by us, not so savy consumers, that the outcome of our actions would not be our true intent had we FULLY understood the effects our actions were going to have after our death. (Speaking in a general context as us/we being consumers obtaining these services.) 

 

So then where is the justice for true intent of the Testator, when wills and contracts have conflicts.

 

would these pertain to a persons Will vs what a person may instruct another individual to do with their money after their passing? I may not be understanding that statement.

purported intent?? 

the deceased person's actions?? 

 

   

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17 hours ago, RetiredinVA said:

When I stated that the assets of an account that requires or allows the designation of a beneficiary becomes a part of the decedent's estate when the designated beneficiary is the executor of the estate I meant the designated beneficiary is "X as executor my estate", not when the designated beneficiary also happens to be the nominated executor.  It is much safer to simply designate the beneficiary as "the executor of my estate" rather than naming a specific person.

This is a example in regards to mis-communication, I may pose this question to other common folk to get their opinion/understanding, or maybe I am just blind. Some people are just really uncomfortable in discussing these matters.

 

So in the beneficiary designation part of a ins policy, a person would have to actually write, "the executor of my estate" or better yet, just "my estate"  

 

Which then this "action" draws the ins policy into probate of the estate?

 

As opposed to the "action" of naming the person who IS the executor of a Will, creates a whole different intent/meaning or outcome correct? 

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Your estate is made up of those assets which have not been specifically given to a person, either prior to your death or upon your death. Your will can not take someone else's property and give it to another. Once a "gift" is given, it is no longer yours and can not be redistributed after your death. If you give your son your bank account, it becomes solely his upon your death, regardless of what you state in your will. It is no different than if you sold a family heirloom; even if Grandmother's ring was listed in the will, it is no longer yours and belongs solely to the new owner. That does not change because you sold it/gave it to someone in the family. That relative/buyer might out of the goodness of their heart give it to Cousin Jane who Grandmother always wanted to have it, but that is entirely up to the new owner.

 

Insurance policies, pensions, and the like typically have a named person as the beneficiary whether or not you have a will. These can be designated to go simply to the estate, but if you put an actual name on it, it belongs only to that person. Same with any tangible objects you gift to someone. If something is truly a loan, it needs to be very very clear, preferably in writing. You might let your son "borrow" your car while you are alive, but "gift" vs. "loan" is frequently the subject of much debate after someone passes.

 

A will only governs those items which are specifically named and which have not already been distributed by other means, such as going to the named beneficiary, or gifted to others. Anything left, becomes the estate and is distributed per the laws of your state. It is very possible, and advisable, to designate how the estate is to be distributed in your will. Possessions and values of assets change over time and you want to have a plan for that. In 2000, Enron stock was quite valuable. In 2002, it was most useful to line the birdcage.

 

If there is more than one person who you intend to inherit your estate, it is well worth your while to consult with an estate planner and lawyer to see that your assets are maintained in such a way that they go where you intend upon your demise. You can name an executor, but granting something to "the executor of my estate" means whomever fulfills that role, gets the goods. Executor of the estate =/= Estate. One is a person, the other a collection of assets and debts.

 

 

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35 minutes ago, TruthSeeker315 said:

So in the beneficiary designation part of a ins policy, a person would have to actually write, "the executor of my estate" or better yet, just "my estate"  

 

Which then this "action" draws the ins policy into probate of the estate?

 

As opposed to the "action" of naming the person who IS the executor of a Will, creates a whole different intent/meaning or outcome correct? 

 

That is correct.  Look at it this way:  Suppose you name Jim Jones as the beneficiary of a life insurance policy.  As it happens, Jim is the executor of the estate of Sally Smith.  You would not believe the insurance policy would become part of Sally's estate.  It would be clear that Jim has two identities, his personal identity and his identity as the executor.  Well, the same thing applies to a will or beneficiary designation that names Jim as a beneficiary.  If the will or beneficiary designation doesn't specify that Jim is receiving the asset as executor, then it is assumed he receives the asset as his personal property.

 

The law of wills is very strict and it needs to be.  After a person dies it is impossible to determine what that person's wishes might have been had they survived.  Therefore the law requires that anything that is to occur as a result or upon the death of a person must be proven in writing and done under strict conditions, such as witnessing of the signature of the testator by two people.  That avoids the situation where a person may add a child to his checking account to make it easier to tend to the person's affair.  After the person's death the child may simply say the decedent told him or her, on his death bed, he could keep the money in the account.  How can it be proven otherwise?  The child has a written document, the account initiation papers, that appear to make him a co-owner of the account and there is nothing in writing to the contrary.

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1 hour ago, RetiredinVA said:

 

 

That is correct.  Look at it this way:  Suppose you name Jim Jones as the beneficiary of a life insurance policy.  As it happens, Jim is the executor of the estate of Sally Smith.  You would not believe the insurance policy would become part of Sally's estate.  It would be clear that Jim has two identities, his personal identity and his identity as the executor.  Well, the same thing applies to a will or beneficiary designation that names Jim as a beneficiary.  If the will or beneficiary designation doesn't specify that Jim is receiving the asset as executor, then it is assumed he receives the asset as his personal property.

 

The law of wills is very strict and it needs to be.  After a person dies it is impossible to determine what that person's wishes might have been had they survived.  Therefore the law requires that anything that is to occur as a result or upon the death of a person must be proven in writing and done under strict conditions, such as witnessing of the signature of the testator by two people.  That avoids the situation where a person may add a child to his checking account to make it easier to tend to the person's affair.  After the person's death the child may simply say the decedent told him or her, on his death bed, he could keep the money in the account.  How can it be proven otherwise?  The child has a written document, the account initiation papers, that appear to make him a co-owner of the account and there is nothing in writing to the contrary.

My reason for asking was that in my mothers will this paragraph was in a previous will, but when the will was updated this paragraph was not updated within the new Will. 

 

During this probate process this joint bank account was used to pay her funeral, debts, property taxes, and such.

A estate account was set up with the sale of the home proceeds being deposited and a few bills paid out of this estate account.

The executor is seeking reimbursement from the probate estate for what was paid out of the JOWRS account that only manifested itself as this type of account a short time prior to her death.  

The only change in a 30yr Will seems to be inclusion of grandchildren that were minors and a wish/hope for college.

On the surface that is a kind act, on the backside the home(probated estate) is only 5% of the gross estate(other accounts) 

 

 

If I should start another thread posing this question if you all think it would be better addressed in a new thread, please let me know.

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I don't know where else we can go with this thread.  Your original question was:

 

"Can one direct that expenses be taking out of joint accounts that were left to a administrator to pay my bills if need be.

Or is that just something you have to trust your administrate will do fairly?"

 

The answer is "No.  If the account is joint with the administrator you cannot require the administrator through the will to use the funds in the joint account to pay the bills."  At the time of your death the funds in the joint account become the sole property of the surviving tenant and are not part of your estate.  You can certainly hope and expect the administrator will do as you wish but you can not command him or her to do so in your will.  There is really not much more to say about the question.  Don't use a joint account, use a power of attorney.

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So, your mother had a joint account with someone, and upon her death, that someone used the funds in the account to pay expenses which would ordinarily be paid by the estate. I am not sure why anyone would do that, as opposed to letting the estate pay those expenses. There is nothing preventing that from happening though.

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1 hour ago, ElleMD said:

So, your mother had a joint account with someone, and upon her death, that someone used the funds in the account to pay expenses which would ordinarily be paid by the estate. I am not sure why anyone would do that, as opposed to letting the estate pay those expenses. There is nothing preventing that from happening though.

 

yes the executor.

 

If the executor has never been in this type of position before,assumes they know what they are doing. It really can become a mess.

 

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