Legal Terms Explained

Law for the Layman: Definitions for Wills, Trusts & Estates

ADMINISTRATOR (Male)
ADMINISTRATRIX (Female)
A person named by the Court to administer the estate of a person who died without a Will.
EXECUTOR (Male)
EXECUTRIX (Female)
A person named in a Will and appointed by a Surrogate Judge to carry out the terms of the Will.
REAL PROPERTY
Vacant land or land with a house on it.
PERSONAL PROPERTY
All assets except for real property i.e. money, automobiles and clothes.
LIFE ESTATE
The right to use or occupy property. The right ceases upon one's death.
BEQUEST
A gift of personal property in a Will.
DEVISE
A gift of real property (land and/or house), in a Will.
LEGACY
A gift in a Will, usually of money.
RESIDUE
The balance remaining after bequests, legacies and devises are given by a Will or Trust.
GUARDIAN
One designated by the Court to protect and look after either a person or the person's property, or both.
GUARDIAN AD LITEM
A person, usually an attorney, appointed by the Surrogate Judge to look after and protect the interests of a minor, a missing distributee, or an incompetent distributee or a person under disability for the duration of the estate proceedings only.
TESTAMENTARY GUARDIAN
A person named in a Will to be the guardian of an infant (minor) or a mentally retarded person.
ISSUE
Descendants from a common ancestor.
DISTRIBUTEE
A person, close enough by blood, who would receive a share if there were no Will.
HEIR AT LAW or NEXT OF KIN
One who inherits when there is no Will.
INCOMPETENT PERSON
One who has been declared by a Court to be unable to manage himself and/or his affairs.
INFANT
A person under age 18, same as a minor.
PERSON UNDER DISABILITY
One whom the Court has reason to believe is incapable of protecting his or her own interest in the estate, although not adjudicated an incompetent.
RESOURCE
A medicaid term which includes all of one's assets but not one's income.
TESTATE
When a person dies with a Will.
INTESTATE
When a person dies without a Will.
LETTERS TESTAMENTARY
Authorization or certificate of authority from the Court certifying the person named is the Executor.
LETTERS OF ADMINISTRATION
Authorization or certificate of authority from the Court certifying the person named is the Administrator.
CODICIL
An addition or supplement to a Will - either adding to, taking from, or changing the provisions of a Will.
DECEDENT
A person who has died.
DECREE
An order or direction from the Court to do or not to do a certain thing, or the written approval by the Court - i.e. decree directing delivery of an asset.
TESTATOR (Male)
TESTATRIX (Female)
A person who makes a Will.
ESTATE
Generally the total property which a person owns - real and personal.
PROBATE
Proven; e.g. when the Surrogate has reviewed the Will, all notices are property given, and witnesses have proven the Testator/Testatrix was of sound mind and actually declared the instrument to be his or her Will in the presence of two witnesses - the Will has then been proven or probated.
SURROGATE'S COURT
A court along with other powers, has full and complete jurisdiction in all matters relating to the affairs of decedents. There are 62 such Courts in the State of New York.
POWER OF ATTORNEY
Written authorization for another person to do something for you - in place of you. Does not grant the power to make medical decisions. Power ceases upon death.
DURABLE POWER OF ATTORNEY
A Power of Attorney which remains in effect even if the grantor of the Power of Attorney becomes mentally incompetent.
SPRINGING POWER OF ATTORNEY
A Power of Attorney which goes into effect upon the happening of a specified event; usually upon the grantor becoming mentally incompetent.
SPEND DOWN
One must use up one's assets until a specified dollar amount remains at which time one will qualify for Medicaid.
HEALTH CARE PROXY
Gives a named individual the right to direct the medical treatment to be given, withdrawn or withheld if the grantor is mentally incompetent.
LIVING WILL
A general statements about desired medical care if one is mentally incompetent.
TRUST
A structure created to protect and manage one's assets and it sets forth how the assets are to be spent and distributed.
CREATOR or GRANTOR
The person who sets up the Trust and generally puts some or all of his or her assets in the Trust.
TRUSTEE
The person who manages the Trust.
LIVING TRUST or INTERVIVOS TRUST
A Trust created while the creator of the Trust is living.
TESTAMENTARY TRUST
A Trust created after one's death by one's Will.
ESTATE TAX
When one dies, a tax may be due based upon the value of the decedent's property.
GIFT TAX
When one gives a gift, a tax may be due.
MARITAL DEDUCTION
All property inherited by a spouse is exempt from Estate Tax and Gift Tax.
Q-TIP TRUST
A Trust which qualifies for the marital tax deduction from Estate Tax and Gift Tax. Income to the Creator's spouse for life and upon his or her death, the Trust is distributed according to the directions set forth in the Trust document by the Creator.
MARITAL POWER OF APPOINTMENT TRUST
A Trust which qualifies for the marital tax deduction from Estate Tax and Gift Tax. Income to the Creator's spouse for life and upon his or her death, the Trust is distributed as directed by the Creator's spouse in his or her will or by other document.
MEDICAID TRUST
A Trust which protects one's assets yet allows one to qualify for Medicaid.
PET TRUST
A Trust that provides for the care of one's pet after one's death.
BY-PASS A/K/A CREDIT SHELTER TRUST
A Trust which preserves the Unified Credit from the first spouse to die so $10,680,00 (2014 value)* may be given by a husband and wife to their beneficiaries free from United States Estate Tax. $2,000,000.00 may be given by a husband and wife to their beneficiaries free from New York State Estate Tax. *Increases periodically based upon the cost of living index.
UNIFIED CREDIT
A dollar for dollar credit against Estate Tax or Gift Tax. Every person has a United States Unified Credit equivalent of $5,340,000 (2014 value).* Therefore, each person can give at least $5,340,000 during his or her lifetime or after death without paying United States Estate Tax. *Increases periodically based upon the cost of living index.
UNIFIED CREDIT INCREASE
YEAR ESTATE UNIFIED CREDIT EQUIVALENT GIFT UNIFIED CREDIT EQUIVALENT
2008 $2,000,000.00 $1,000,000.00
2009 $3,500,000.00 $1,000,000.00
2010 NO ESTATE TAX $1,000,000.00
2011 $1,000,000.00 $1,000,000.00
PORTABILITY
Preserves the unused Unified Credit of the first spouse to die. Steps must be taken to timely elect portability or it is lost.
ANNUAL EXCLUSION
Allows one to give up to $14,000.00* (2014 value) per year to as many people as one wants, gift and estate tax free. For example, one can give one's children $14,000.00 each, gift and estate tax free every year. *Increases periodically based upon the cost of living index.
NEW YORK STATE TAX
Estates greater than $1,000,000.00 are taxable.
NEW YORK STATE GIFT TAX
Repealed for gifts made after January 1, 2000.
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