A MESSAGE FROM SURROGATE SUSAN J. HOFFMAN

The most sensible, practical and surest way we can protect those who depend on us is by making a will.

I have assembled this booklet for distribution to all county residents to inform the public of the advantage of preparing a will, outline the meaning of the word "probate" and the course of action required to complete probate.

Wills should be reviewed on a regular basis as your situation in life changes such as children, moving to another state, grandchildren, remarriage, purchase of real property, etc. State and Federal laws also change constantly which could mean a revision in your will. Remember: an investment in a properly drawn will could save your heirs additional transfer inheritance taxes and income taxes at the time of your death.

If I can answer any questions or be of assistance, the Surrogate's Court is open Monday through Friday 7:45 AM - 5:15 PM or by appointment.

For information regarding a guest speaker, please contact me - I am available to speak to any group as a free public service.

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THE IMPORTANCE OF A WILL

Do you have a will? If not, you've probably given some thought to it. You know it's a good idea to make a will, but one thing or another keeps coming up and you put off doing something about it. It's a subject you really don't feel like thinking about - somehow, executing a will seems to make "the day of reckoning" a little closer.

Unfortunately, many people do not execute wills for two reasons - procrastination and antipathy to thoughts of death. Another reason for dying in testate (without a will) is that most individuals don't have a clear idea as to the law. They realize that if they die without will, their assets will be distributed to their family. But what they don't understand is that the plan of distribution may not be in accordance with their wishes. In fact, it's a good bet that it won't be as they would have desired.

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THE WILL DEFINED

Before proceeding further, let's define the will. It is a legal declaration of a person's intention concerning what shall be done following the death, as to the disposition of the property and the administration of the estate. Three characteristics of a will set it apart from other forms of property transfer.

1. A will is revocable during life - you can change your mind.
2. A will is inoperative until death - it's provisions don't take effect until that time.
3. A will only applies to the situation that exists at death - as to the extent of your property holdings and beneficiaries.

There are well defined legal requirements regarding wills which relate to such matters as the capacity to make a will, execution, restrictions upon the disposal of property by will and revocation. These requirements, which are beyond the scope of this discussion, are a direct concern you should present to your lawyer.

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STEPS IN PREPARING YOUR WILL

A will that is to be successfully probated and made to meet your needs and wishes, must first be thought out carefully by you. Although you can prepare your own will, an attorney can help fulfill your intentions and guide you in making the best decisions. Be sure to discuss fees with the attorney so there is no misunderstanding at a later time.

Remember, your will can be changed at any time you wish, as your assets, intentions or desired beneficiaries may change. Your will is not made public while you are alive, since the will is not presented for probate nor recorded before your death. The existence of a will does not affect your right to dispose of your property during your lifetime.

Firstly, start by making a list of all your assets. It is important to list how each asset is owned - individually, jointly, in trust, etc. - since this will determine whether or not the disposition of the property will be governed by the will, or by operation of law. Joint property with right of survivorship, real property and motor vehicles in the name of husband and wife pass automatically to the survivor.

Secondly, examine the beneficiary designations in all life insurance policies, IRA, pension plans and similar documents. They will not become part of your estate and therefore, be sure you have not included their value to cover any expenses.

Thirdly, select an executor to administer the will. It is the executor's duty to collect all the assets of the estate, determine what claims are being made against the estate, file the necessary tax returns and distribute the assets among the beneficiaries under the will. The executor may be a beneficiary under the will, a member of your family, your legal or financial advisor, a friend, a bank, trust department or business associate. It is also advisable to name a contingent executor to act in case your first selection dies before you, or, for any reason, is unable to serve as executor.

If the will is complex, you may need to appoint a trustee and/or guardian for some of the beneficiaries. A financial institution may be the right trustee to appoint in this situation to handle the many complex tax, accounting, investment and property management decisions.

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EXECUTING YOUR WILL

To be effective, a will must be written, signed by the testator and witnessed by at least two people, or the signature and material provisions are in his/her handwriting. The latter is not recommended because these wills , referred to as holographic wills, cannot be probated in the Surrogate's Court but must be presented to the Superior Court.

Each witness must personally witness the signing of the will. Witnesses do not have to read the will or know it's contents. However, they must be told by the testator that it is his will, and that he wants them to be witnesses to its execution.

While the law permits a beneficiary to witness a will, it is recommended that a beneficiary-witness be used only when a disinterested party is not available. In this way, possible future challenges may be avoided.

NJ Statutes also allow the witnesses and testator to sign the will in the presence of a Notary Public or attorney making the will "self-proven". This relieves the witnesses from appearing in the Surrogate's Court to prove their signature at the time of probate.

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SAFEGUARDING YOUR WILL

The will should be kept in a secure place such as safe deposit box or fire proof strong box. But more importantly, your executor should know where it can be found. It is a good idea to give a copy of the will to your executor with a notation where the original will can be located.

If it is kept in a safe deposit box it can be removed by the executor immediately following your death in the presence of an employee of the bank upon proof that you are the proposed executor named in the will.

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KEEPING YOUR WILL UP TO DATE

A will should be periodically reviewed and kept current. Keeping it current is just as important as making one in the first place. Certain changes in your life, such as marriage, birth of a child, purchase or sale of property, change in your financial status, or changes in various tax laws may warrant your making certain important revisions in your will. Also, laws change from state to state (and country to country) so the will should be updated to take the local laws into account.

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HOW TO CHANGE YOUR WILL

There are two ways to change your will: prepare a new one or prepare a codicil. If there are many changes to make, it may be less confusing to the executor to prepare a new will. If you have only minor additions or deletions, a codicil, executed in the same formality as a will, would be sufficient. Changing your will by drawing lines through items, erasing, writing over or adding notations is improper and may destroy it as a legal document.

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AFTER DEATH

When a person dies leaving assets in his name alone or in joint names with another person other than a spouse, it will be necessary to present the will to the Surrogate for probate. The will is presented to the Surrogate in the county wherein the decedent resided at the time of death.

The executor will need to present the original will, certified copy of death certificate and a list of names and addresses of the closest next of kin to the Surrogate. Papers are prepared by the court and signed by the executor. The legal review of the documents by the surrogate is the probate of the will. If all requirements are met, the will is admitted to probate and certificates are issued to the executor. These certificates allow the executor to execute documents formerly done by the decedent such as transfer automobiles, bank accounts, investment accounts, etc.

The original will is retained by the Surrogate and filed and recorded in the Surrogate's Court. The will becomes a public record and is listed in the general index.

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LETTER OF LAST INSTRUCTION

Few persons expect to die when they do, and therefore, relatively few leave their affairs in perfect order. Those who administer an estate and take care of what is left often find themselves without necessary information. To facilitate their job, it is advisable to give your personal representative or your attorney a letter of last instruction which is separate and apart from your will. This letter should contain the following:

1. Name and address of those to be notified at death and relationships of family members.
2. Instruction as to burial and funeral including any prepayments of funeral expenses.
3. Location of birth, baptismal and marriage certificates as well as social security card, citizenship papers, armed forces discharge papers and titles to automobiles.
4. Location of safe deposit box and where keys are kept.
5. List of insurance policies and where they can be found.
6. List of stocks, bonds, securities, savings accounts, credit union accounts, etc.
7. Statement of all real property owned by you with location of deeds, mortgages, abstracts and insurance policies for real property.
8. Location of income tax returns for previous five years.
9. Receipted bills and cancelled checks for previous five years.
10. List of any gifts made and information needed for estate tax.

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MANY ASKED QUESTIONS........

1. WHAT IS A WILL?
   A will is a legally enforceable written document directing which belongings and property go to whom. It also transfers ownership of real and personal property when the maker of the will passes away.
   
   
2. DO I NEED A WILL?
   Yes--if you want your assets to be distributed according to your wishes rather than by statute. Also, you get to pick the executor.
   
   
3. WHAT IF THE WITNESSES DIE OR CAN NOT BE LOCATED?
   A minimum of at least two witnesses is required to witness a will. You may, however, have additional witnesses. This would help insure that at least one witness would be available in the event of the testator's death. If one witness dies or can not be located you need do nothing. However, if no witnesses to the will are living someone who can identify the signatures of the two of the witnesses must come forth. If all witnesses die or cannot be located, it is advisable to prepare a new will
   
   
4. CAN THIS PROBLEM BE AVOIDED?
   Yes, simply have your will made self-proven at the time of signing which means to have a notary or attorney attest that they saw the testator and the witnesses sign the will and then witnesses will not be required to prove the will.
   
   
5. CAN A WILL SAVE MONEY?
   Yes, a will can eliminate the requirement of a bond which will reduce administration expenses and it could permit your estate to take advantage of tax savings.
   
   
6. CAN I PREPARE MY OWN WILL?
   Yes, but without professional guidance and advice it may not be legally sufficient to be admitted to probate. In addition, self prepared hand written "holographic" wills can only be admitted to probate after a costly time consuming formal Superior Court hearing.
   
   
7. CAN I NAME MORE THAN ONE EXECUTOR?
   Yes, you can name two or more executors to serve at the same time or alternate executors to serve in the event the first named executor dies or is unable to serve.
   
   
8. WHAT EFFECT DOES A WILL HAVE ON REAL ESTATE OWNED JOINTLY BY HUSBAND AND WIFE?
   Real estate owned jointly by husband and wife in the form of ownership legally known as "tenancy by the entirety" is not controlled by the will of the spouse who dies first. Absolute ownership of the property will pass to the surviving spouse who has rights of survivorship, regardless of what the will may provide.
   
   
9. WHAT ABOUT JOINT BANK ACCOUNTS OR CERTIFICATES OF DEPOSIT?
   Accounts held jointly may be owned with right of survivorship and if you want the account to pass outside the estate when one owner dies, make sure you set the account up that way.
   
   
10. DOES A DIVORCE REVOKE THE ENTIRE WILL?
    A divorce operates as revocation of any bequest made to your former spouse or any appointment of your former spouse as executor, but in all other respects the will is still effective.
    
    
11. DO ALL STATES HAVE THE SAME PROBATE LAWS?
    No, although New Jersey is one of several states to enact the Uniform Probate Code, most states have their own probate laws. It is a good idea to have your will reviewed when you move to another state.
    
    
12. IF BOTH PARENTS DIE LEAVING CHILDREN UNDER 18 YEARS OF AGE AND THEY HAVE NO WILL WHO SELECTS THE GUARDIAN?
    Application is made to the Surrogate who usually appoints a person from among the next of kin of the minor.

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GUARDIANSHIPS FOR MINORS

A Guardian for a minor can be named in a will or the Surrogate can appoint a guardian if a minor receives an inheritance or proceeds from a lawsuit.

Normally, the money is deposited in the Surrogate Court Intermingled Account and held until the minor reaches the age of 18 years.

As an alternative, the Guardian could post a bond and invest the monies themselves on behalf of the minor with court permission.

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POWERS OF ATTORNEY

A Power of Attorney is a written document in which another adult person is authorized to act on your behalf regarding real property, bank accounts and other financial and legal matters.

It is generally used when someone is unable for some physical or mental reason to carry out his or her affairs. With this instrument, a spouse, friend or family member, called an Agent, can act on behalf of you, the Principal.

There are generally two kinds of Power of Attorney: limited and general. The limited power of attorney gives a person authority to act for a specific purpose. With a general power of attorney the agent has the authority to act on anything and everything for the principal if he or she becomes disabled or mentally incompetent. Most general powers of attorney will have a provision that will allow the agent to act even in the event of the disability of the principal. A power of attorney ends at the death of the principal.

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IF YOU DIE WITHOUT A WILL - WHO GETS WHAT

The intestate share of decedent’s surviving spouse or domestic partner is:

a. The entire intestate estate if:

(1) No descendant or parent of the decedent survives the decedent; or

(2) All of the decedent’s surviving descendants are also descendants of the surviving spouse or domestic partner and there is no other descendant of the surviving spouse or domestic partner who survives the decedent;

b. The first 25% of the intestate estate, but not less than $50,000.00 nor more than $200,000.00, plus three-fourths of any balance of the intestate estate, if no descendant of the decedent survives the decedent, but a parent of the decedent survives the decedent

c) The first 25% of the intestate estate, but not less than $50,000.00 nor more than $200,000.00 plus one-half of the balance of the intestate estate:

(1) If all of the decedent’s surviving descendants are also descendants of the surviving spouse or domestic partner and the surviving spouse or domestic partner has one or more surviving descendants who are not descendants of the decedent; or

(2) If one or more of the decedent’s surviving descendants is not a descendant of the surviving spouse or domestic partner.

Any part of the intestate estate not passing to the decedent’s surviving spouse or domestic partner or the entire intestate estate if there is no surviving spouse or domestic partner, passes in the following order to the individuals designated below who survive the decedent:

a. To the decedent’s descendants by representation;

b. If there are no surviving descendants, to the decedent’s parents equally if both survive, or to the surviving parent;

c. If there is no surviving descendants or parent, to the descendants of the decedent’s parents or either of them by representation;

d. If there is no surviving descendant, parent or descendant of a parent, but the decedent is survived by one or more grandparents:

(1) half of the estate passes to the decedent’s paternal grandparents equally if both survive, or to the surviving paternal grandparent, or to the descendants of the decedent’s paternal grandparents or either of them if both are deceased, the descendants taking by representation;  and the other half passes to the decedent’s maternal relatives in the same manner; but if there is none the entire estate passes to the decedent’s relatives on the other side in the same manner as the half.

e. If there is no surviving descendant, parent, descendant of a parent, or grandparent, but the decedent is survived by one or more descendants of grandparents, the descendants take equally if they are all of the same degree of kinship to the decedent, but if of unequal degree those of more remote degree take by representation.

f. If there are no surviving descendants of grandparents, then the decedent’s step-children or their descendants by representation.

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GLOSSARY

• Administrator: (also known as Personal Representative) Person or institution appointed by the court to manage and distribute the estate of a person who dies without a will.
  
• Beneficiary: Person named to receive property or benefits.
  
• Codicil: An addition or supplement made to change or add provisions to a will.
  
• Contingent beneficiary: Receiver of property or benefits if first-named beneficiary dies before receiving all benefits.
  
• Contract: Legal enforceable agreement.
  
• Decedent: A deceased person.
  
• Devise: To give (or a gift of) property.
  
• Estate: Everything a person owns.
  
• Executor: (also known as Personal Representative) A person or institution named in the will to carry out the provisions and directions of the will.
  
• Heirs: Those persons who are legally entitled to receive a decedent's property.
  
• Issue: Children, grandchildren, great grandchildren, etc. (lineal descendants)
• Intestate: A person who dies without making a valid will.
• Legatee: A person who receives personal property under a will.
• Levy: To collect by assessment.
  
• Lien: A charge upon property, real or personal, for the satisfaction of a debt.
• Personal property: Intangible property such as stocks, bonds, or bank accounts and tangible property such as furniture, automobiles and jewelry.
• Probate: Official proof of the genuineness of a will.
• Real property: Land and buildings.
• Surrogate: A judicial officer who has jurisdiction over the probate of wills.
• Tenants in common: Two or more persons owning individual interests in property.
• Testator: The person who makes a will.
• Trust: Property owned and managed by one person for the benefit of another person.
• Trustee: Person or institution holding property in trust.
• Waiver: A legal instrument relinquishing a right or lien.
• Will: A legal declaration of the manner in which a person wishes his estate divided after death.
• Witness: Person who observes the signing of a will and also attests to the signatures.

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FREQUENTLY REQUESTED TELEPHONE NUMBERS

• Hunterdon County Surrogate's Court: 908-788-1156
  
  
• Hunterdon County Clerk, to obtain copies of deeds and mortgages: 908-788-1221
  
  
• Hunterdon County Historical Society: 908-782-1091
  
  
• Hunterdon County Office on Aging: 908-788-1361
  
  
• Township of Raritan, Registrar of Vital Statistics, to obtain death certificates: 908-806-6100
  
  
• New Jersey Department of Health, Division of Vital Statistics, to obtain birth, death and marriage records:  609-292-4087
  
  
• Internal Revenue Service, to obtain estate ID #:  1-800-829-1040
  
  
• State of New Jersey, Transfer Inheritance Tax Bureau: 609-292-5033/5035
  
  
• Social Security Administration: 1-800-772-1213

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