(732)572-0500. Edison, NJ.
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2053 Woodbridge Avenue - Edison, NJ 08817
Tuesday, October 12, 2021
E625 VercammenLaw News
1.What is a Testamentary Trust in a Will for minor children or children with problems with money
2.Have a Power of Attorney prepared for your college children and children traveling out of state
3. September Estate Planning & Probate seminars
4 End of Summer Bash Edison September 11, 2021
5. September Running Races
1What is a Testamentary Trust in a Will for minor children or children with problems with money
The Testamentary Trust in a Will is recommended when you have minor children, or children that can’t handle money.
A testamentary trust is a Trust set up inside your Will
A regular trust is funded during your lifetime with your assets.
A Testamentary Trust in a Will is not funded until you pass away.
A funded Stand-alone Trust costs between $3,000- $4,000 to set up and usually not needed in NJ.
A Will with Testamentary Trust costs approx $500 each.
A Testamentary Trust in a Will (sometimes referred to as a will trust or trust under will) is a trust which arises upon the death of the testator, and which is specified in his or her will.
Testamentary trusts are distinguished from inter vivos trusts, which are created during the settlor's lifetime and funded with money.
There are four parties involved in a testamentary trust:
·the person who specifies that the trust be created, usually as a part of his or her will, but it may be set up in abeyance during the person's lifetime. This person may be called the grantor or trustor, but is usually referred to as the settlor;
·the trustee, whose duty is to carry out the terms of the will. He or she may be named in the will, or may be appointed by the probate court that handles the will;
·the beneficiary(s), who will receive the benefits of the trust;
·Although not a party to the trust itself, the probate court is a necessary component of the trust's activity. It oversees the trustee's handling of the trust.
A testamentary trust is a legal arrangement created as specified in a person's will, and is occasioned by the death of that person. It is created to address any estate accumulated during that person's lifetime or generated as a result of a postmortem lawsuit, such as a settlement in a survival claim, or the proceeds from a life insurance policy held on the settlor. A trust can be created to oversee such assets. A trustee is appointed to direct the trust until a set time when the trust expires, such as when minor beneficiaries reach a specified age or accomplish a deed such as completing a set educational goal or achieving a specified matrimonial status.
For a testamentary trust, as the settlor is deceased, he or she will generally not have any influence over the trustee's exercise of discretion, although in some jurisdictions it is common for the testator to leave a letter of wishes for the trustee. In practical terms testamentary trusts tend to be driven more by the needs of the beneficiaries (particularly infant beneficiaries) than by tax considerations, which are the usual considerations in inter vivos trusts.
Using a Testamentary Spendthrift Trust in a Will for children with substance abuse issues
A spendthrift trust in a Will is one of the best options when estate planning for addicts. There are several forms of this trust a parent can consider, and each has pros and cons. At its most basic, the spendthrift trust enables a parent to put spending authority in the hands of a trustee, or a trusted person who will control the reckless spending of the child. This can prevent them from wasting funds and can prevent them from using funds to purchase drugs.
Spendthrift clauses in trusts are also valuable because a parent can use them to provide necessary funds such as food, clothing, cab fare and shelter to the beneficiary, without allowing them to spend anything else. This enables a parent to offer support, even after a parent are deceased.
Finally, spendthrift clauses typically protect the funds in the estate from creditors. So long as the funds are in the trust, creditors cannot reach them. This is ideal in instances where the child may have to declare bankruptcy due to poor financial decisions while under the influence of drugs or alcohol, has a large amount of debt, or is likely to accrue a large amount of debt. However, once funds are taken out of the trust, they can be garnished by creditors. Creditors include child support, alimony, taxes, Medicaid.
In some cases, a parent may be able to set up a discretionary spendthrift supplementary needs trust, which enables the child to qualify for needs-based government benefits (SSI, Medicaid, housing, SNAP, etc.), while offering the other benefits of the trust.
The best way to set this up is to create a Testamentary Discretionary Trust with a spendthrift clause, which will come into effect after a parent are deceased. Then, the funds will be moved into trust and spending will be controlled by the trustee for the benefit of the child (the beneficiary). Source https://beginningstreatment.com/estate-planning-for-addicts/
N.J.S.A. 3B:31-68 Discretionary Powers
Originally drafted by one of NJ’s top attorneys Glenn A. Henkel, also a past great Wrestler at St. Thomas Bishop Ahr High School Edison with Ken V on wrestling team.
2. Have a Power of Attorney prepared for your college children and children traveling out of state
There are many good reasons to consider getting a Power of Attorney and Medical Directive for your adult "child". A prominent Monmouth County Law office wrote while you made certain decision for your child before he or she turned 18, you have no authority to take action now. In the event your child becomes ill or has a serious accident while they are away, you do not have legal right to withhold Power of Attorney, it is important to have a plan in place to deal with their health, financial, educational and legal needs.
Durable Power of Attorney to handle finances will enable you to take care of tasks for your child. This includes: registering their car; communicating with their college about issues which fall under HIPAA, like grades and disciplinary actions; completing financial transactions at their bank, their college, etc. If your child runs in to an issue with their passport while they are overseas, you can be assured that you have the authority to help.
Living Will or Health Care Directive is important in the event of an accident or illness. You will be able to talk to medical staff and make decisions on your child's behalf, if necessary.
While you may never need to use these documents, it is better to be safe than sorry!
9/18/21 Rat Race Pub Crawl Belmar 4-Miles, 4-beverage (beer and a few others) stops/checks, Celebrating 25-years of the WRAT Radio Station, $25 pays for all + you get a premium 'Rat Hash' hat, 10:17a.m. start - Maclearie Park - Belmar, NJ 07719 (Park across River Rd. if there are no parking spots left), Bar-b-Que at the end, will run partially through the San Gennaro Festival and also have a bagel and coffee stop (if you wish). This is a Coed event and this is not a serious run - JUST FUN! and scenic too! https://raceforum.com/RatHash
9/19/21 ShopRite of Hunterdon County Race for Hunger Sunday Flemington, NJ US 08822
If you are attending any of these charity races, please call or email Ken V. at Kenv@njaws.com Often we car pool from East Brunswick /Edison or meet at these events. I update this list at http://vercammensport.blogspot.com I share these events so that even non-runners can walk or volunteer. All events help an area charity or non-profit. We encourage Americans to get off the couch and exercise .
6. HELP WANTED - Clerk for Law Office – Answer phones, schedule appointments, envelope stuffing, misc. clerk duties
start 8:55am 1:30 flexible
To start September
$15.00 per hour start
-Adding client names to computer database, open files, prepare letters, and work on client traffic ticket matters.
- Preparation of documents on Computer and mail to courts
-General Office duties in Law Office
-Update mailing/ client lists and learn marketing
-All other work needed including working on litigation cases
A good way to learn NJ Law Office procedures
Must be dependable and committed to perfection.
Call Law Office of Kenneth Vercammen & Associates at 732-572-0500 if interested.
Check out our website at www.njlaws.com to see more information on our law office.