The Importance of Establishing Guardianship for Minor Children

Everyone hopes to outlive their children, but you also hope that they are adults and well established in life before you pass on. But what happens if you die while your children are still minors? While it can be temporarily uncomfortable to address these issues, making a plan for these worst-case scenarios is vital for the welfare and security of your child.

In situations where there are two parents, the other parent would naturally step in, but this isn’t the case for everyone. If one parent has already passed or is not a part of the child’s life, it’s important to think about who would talk over as guardian for your children. Learn more about how guardianship works in New York, including picking a suitable guardian and how guardianship is established.

Who is a Guardian and What Are Their Responsibilities?

A guardian is a person who is responsible for providing care, maintenance, and support to the minor individual under their guardianship. The guardian of a minor has the same rights as a parent to make decisions regarding their health care, education, religious upbringing, housing situation, and other essential matters. Any individual over the age of 18 with a sound mind can be appointed as a guardian. However, you should make your designation carefully after considering the potential guardian’s values, skills, resources, and availability, as well as the familiarity of the individual with your children. The court maintains oversight of the guardian’s actions, and guardians must file an annual report with the court to update them on the status of the protected minor. 

The duties of a guardian may vary depending on the type of guardianship granted, but some primary responsibilities include:

• For guardians of the person:
  • Providing proper care, maintenance, education, and support.
  • Supplying food, clothing, shelter, and necessities.
  • Authorizing medical, surgical, dental, psychiatric, and psychological care.
  • Ensuring the protected person is appropriately trained and educated.
• For guardians of the property:
  • Managing the individual’s money and property strictly in their interest.
  • Preserving and protecting the individual’s assets.
  • Creating an inventory of the individual’s assets.

How Guardianship Works in New York

Establishing a guardianship plan is a way to ensure that you have some say in who will take over raising your child if something happens to you and the other parent. This is done by naming someone, referred to as the guardian, to assume care of the child, who is called the ward. However, there are also other circumstances where guardianship may be needed. 

For example, if a parent abandons or neglects a child, is deported, or is physically or mentally unable to make decisions for the child, a guardian may be needed.

The court is tasked with appointing a legal guardian, and without a guardianship plan in place, your child may be placed in foster care or be put into the care of someone you wouldn’t have chosen. It’s important to understand that while you can make your wishes known through a guardianship plan, it’s not a guarantee. For example, in the state of New York, once a child is 14 years of age, they must consent to the appointment of the guardian. If your child doesn’t want your choice to be appointed, another guardian may be instituted instead.

What Types of Guardianship Exist in New York?

With the assistance of a knowledgeable estate planning attorney, you can create a guardianship plan that will safeguard your minor children, no matter what happens in the future. Several documents may be used to create a customized plan covering every eventuality. New York law makes provisions for at least three varieties of guardianship that can be utilized in different situations.

Standby Guardian

Emergencies can occur anytime and may impact your ability to be present or provide proper care for your child. By completing a Designation of Standby Guardian form, a parent can ensure that their child will receive immediate care from a trusted person without significant disruption if a specified event occurs. A standby guardian is an individual who is given temporary authority to care for a minor child while the parent or legal guardian is still alive, although the standby guardian may petition the court to make the arrangement permanent if the circumstances warrant it. 

The event that allows the standby guardianship to go into effect is known as a “triggering event.” Examples of triggering events may include:

• Administrative separation between the parent and child, including incarceration, deportation, detention, and other events.
• Doctor diagnosed mental incapacitation, which renders the parent unable to care for the child.
• Physical debilitation, such as terminal illness, that causes the parent to consent to the initiation of the standby guardian’s authority.

The parent can specify whether they want the named standby guardian(s) to be the guardian of their child’s property, person, or both. For extra protection, the parent may choose one or several persons to act as standby guardians, in case a named standby guardian is unable or unwilling to assume responsibility when the triggering event occurs. It is important to note that if this designation is being made in anticipation of a specific triggering event, the standby guardianship must be approved by a judge prior to the event taking place. After completing and filing their form, the parent or legal guardian still retains full parental, guardianship, custodial, or caretaker rights and can revoke or cancel the standby guardianship at any time. 

Permanent Guardian

When creating your estate plan, it is crucial to consider who will care for your children long-term if you should pass away unexpectedly. Your co-parent will generally retain the right to be the guardian for your minor children in this event without any action required from the court. However, appointing a guardian in your Last Will and Testament provides protection if you and your co-parent are both deceased before your children become adults.

You should discuss your decision with the person you intend to name as your child’s guardian to ensure they are comfortable with the role and understand any expectations you may have. You may also wish to speak to your teenage children about your choice and allow for their input, as children over 14 may be consulted by the court for their consent before a guardian is appointed.

Guardian of the Property of a Minor Child

New York state law aims to protect the finances of minor children from fraud or mishandling. If a child receives assets valued at $10,000 or more from an inheritance, lawsuit settlement, or another source, a guardian of the property must be appointed. The guardian, working in conjunction with the court, is tasked with managing the child’s money until they turn 18. The designated individual has a fiduciary duty to act in the child’s best interests, and they cannot withdraw any funds without the consent of the court.

Factors to Consider When Choosing a Guardian for Your Child

While any person who is at least 18 years old and of sound mind can technically serve as a guardian for your children, it’s important to choose who will fill this role very carefully. Taking care of a child is an enormous responsibility — as you well know — and the person you choose should be physically able to care for the child, mentally prepared, and emotionally mature and be financially stable enough to support a child.

It’s also a good idea to choose someone who already has a solid, positive relationship with the child, as this can help ease the transition. Many people choose to name the child’s grandparent, adult sibling, or an aunt or uncle as a guardian. However, you may also choose a more distant relative or family friend if you feel they would be better suited.

Remember to factor in parenting philosophies as well as cultural and religious differences. If you want your child raised in a certain culture or religion, it’s important to consider this when you’re choosing a guardian.

Creating a Guardianship Plan

If you need to create a guardianship plan, your first visit should be to an attorney. A lawyer can help you understand how guardianship works in New York and help you make a plan that covers any specific scenario. A guardianship plan can be written into a will or created as a separate document that goes into play with a triggering event, such as a death, incarceration, or illness.

It’s also a good idea to ensure that you discuss your wishes with the person you intend to name as guardian and the rest of your family members, so there are no surprises when and if the time comes. This also ensures that the potential guardian is aware of their responsibilities and has the opportunity to ask questions, express concerns, or let you know that they don’t feel comfortable taking on that role.
Remember that any guardianship plan you create will still have to go through the court system to be put in place, so it’s important that all parties understand what that entails.

Can Guardianship Be Temporary?

Yes, in some cases, guardianships can be temporary. This may be done if there are temporary circumstances that keep the parents from being able to care for and make decisions for their children. For example, if the parent is in the military and is being deployed, it may make more sense for a temporary guardianship to be established so that the child can stay behind where their friends and school are. When the parent returns, the guardianship would be ended, and they would resume responsibility and care for the child. A temporary guardianship may also be used if a parent is very ill or is being incarcerated. A temporary guardian is usually referred to as a “standby guardian” in the state of New York.

How Do You Change or Rescind a Guardianship?

If the guardianship has not been put into place and you just want to make changes to who your appointed person would be, you can do this at any time. All you have to do is create a new document and destroy the old one. If the guardianship is already in place and the guardian no longer wants to or is unable to continue to care for the child, they must file a petition with the courts. The courts will review the circumstances and appoint a new guardian, if necessary.

How Can Our Estate Planning Law Firm Assist You?

Creating a guardianship plan isn’t difficult, and it’s something that’s important to ensure your children are cared for and that you have peace of mind if something were to happen. Whether you need help creating a guardianship plan or you wish to petition for guardianship, Davidov Law Group can help. Call 516-928-6594 to schedule an appointment to go over your case with an attorney.

Understanding Business Succession Planning

Ensuring that you have a strong estate plan set up for your personal property and assets can make things smoother and less stressful for your beneficiaries and provide you with peace of mind as you live out the rest of your years. But if you’re a business owner, you also need to make a plan for what you want to happen with your company should something happen to you unexpectedly. Keep reading to learn more about what business succession planning is, why it’s important, and how to create a solid succession plan.

Why Business Succession Planning Is Important

You’ve worked hard to build your business and make it a success, so it’s important to plan for the future when you may not be here to oversee every aspect and make every decision. Business succession planning involves making provisions for the transfer of ownership if you were to pass unexpectedly as well as creating processes that ensure that your business can function well without you.

The main objective of business succession planning is to ensure that your business, including the employees and customers who depend on it, faces as little disruption as possible if something were to happen to you. Larger companies are often more inherently set up for this because they may have more stakeholders and more leadership staff who are able to take over and keep things running, but small businesses can face immediate issues without a proper succession plan in place.

The Benefits of Effective Succession Planning

When done properly, a business succession plan can provide many benefits for you personally and your business’s overall health. A business succession plan lets you rest easy knowing your business is in good hands. It’s also good for your business because it means you’ve ensured that your business isn’t dependent on any one person.

You may have heard people in your industry refer to “hit by a bus syndrome,” which means that if any one person at your company was hit by a bus, the business would not be able to continue or would experience extreme hardship temporarily. For example, if only one person at your company knows how to run payroll and they get “hit by a bus” — which can also mean that they quit or are too ill to come into work — payroll can’t go out, which is extremely problematic. Effective succession planning ensures that your business continues to run smoothly no matter what happens.

Business Succession Laws and Regulations in New York

When you’re creating a business succession plan, it’s important to be aware of the various laws and regulations that govern these types of issues, specifically in regards to transfer of ownership. For example, there are specific rules for how much stock can be gifted to someone on an annual basis. Gifting stock is one way to transfer ownership, but if you don’t consult with an attorney, you could find yourself paying hefty taxes.

Another option is to set up transfer of ownership in the business through a trust, but these also have specific guidelines. An attorney can help you understand what type of trust is the best one for your situation and ensure that everything is done correctly to facilitate a seamless transition when it’s time.

The best way to ensure that your business succession plan is in accordance with New York’s rules and regulations is to develop it with the help of a qualified attorney.

Creating a Succession Plan

If you’ve never created a succession plan before and aren’t sure where to start, the team at Davidov Law Group can help. We can guide you through the following steps to ensure that your succession plan is appropriate for your business and has covered every possible contingency.

Assessing the business. The first step is to take stock of your business, including making a list of employees and their roles, customers and clients, vendors, and your profit and loss history.
Identifying potential successors. Once you know what you have to pass on, you’ll need to start identifying candidates to take over the business. You may want to consider both overall ownership here as well as identify employees who could step up into more responsibility if needed.
Plan how to get current employees and potential successors up to speed. If your successor hasn’t worked in the business before, it’s a good idea to get them familiar with what your company does and how it works long before ownership actually transfers. This step is also where you would start crosstraining or promoting the employees identified in the previous step.
Create the business plan. Meet with an attorney to solidify your succession plan and make it official.

Identifying Potential Pitfalls in Succession Planning

One of the main parts of creating a successful succession plan is to take an inventory of the pain points of your business operations. Ask yourself questions like:

What employees would I be lost without?
Is there anything that only one person can do?
Which of my lower-level employees are showing potential for leadership positions?
Who would I trust with my business?

Asking and answering these questions can help you get a better understanding of where you need to do some extra work to ensure that things can run smoothly if something happens. For example, if you have one key employee that seems to keep the place running, it’s a good idea to focus on cross-training others to start spreading out some of those tasks and ensuring you’re not relying too heavily on any one person.

Whether your business is just starting or you have years of profitable dealings, creating a business succession plan should be part of your larger estate planning. Get help ensuring your company’s future is secure when you work with the legal team at Davidov Law Group. Call our office today at 516-928-6594 to get started.

How Trusts Can Help Protect Your Assets

Having a solid estate plan can bring relief in your later years by providing peace of mind that your wishes are clearly stated and that those left behind will know what to expect. While a good estate plan has several parts and may make use of different tools, the trust is one possibility that is often overlooked but can be very helpful in many cases. Keep reading to find out how you can use a trust for asset protection.

What Is a Trust?

A trust is an estate planning tool that lets you transfer assets to another person. When you place the assets in the trust, you also designate a beneficiary — or multiple beneficiaries — as well as a trustee. The trustee is responsible for managing the trust and ensuring that the assets are properly distributed to the beneficiaries according to the terms of the trust. The person who creates the trust is called the trustor.

There are a few different types of trusts, but most people have either revocable or irrevocable trusts. An irrevocable trust is one that can’t be changed after it has been set up. It gets its name from the fact that the trustor can’t change their mind — or revoke the terms. A revocable trust is one that can be changed up until the trustor’s death. These trusts are often more popular because they allow for more flexibility.

You may also hear people use the terms living trust or testamentary trust. A living trust is one that is created while the trustor is still alive. A testamentary trust is one that is set up after the trustor’s death through instructions left in the will.

Using Trusts for Asset Protection

Many people believe that the best way to leave their assets to their children, grandchildren, or other beneficiaries is to outline their wishes in a will. However, wills can be more cumbersome, are harder to change, and can take a long time to go through probate. Using a trust as part of your overall estate plan can give you more flexibility and freedom in ensuring that your assets are distributed as you wish.

Benefits of Using Trusts

There are many benefits to using trusts for asset protection as part of your estate plan, and we’ve outlined some of the most important ones below. If you’re not sure whether a trust is the right option for you or you have questions about how a trust can help you protect your assets, talking with an estate planning attorney at Davidov Law Group is a good first step.

Bypassing Probate

One of the biggest advantages using a trust provides is that assets in a trust don’t have to go through probate. Assets that are set to be dispersed through a will can be held up for months — or even years if the will is contested — which can create problems if those assets are needed quickly to pay for a funeral or other expenses. Bypassing probate also means there are no worries about anyone trying to challenge how you’ve distributed your assets.

Ability to Change Beneficiaries

While it is possible to change how your assets are distributed in a will, it requires creating an entirely new will every time. If you work with an estate planning attorney to set up the right kind of trust, you can have more flexibility in changing the beneficiary without having to change your entire estate plan or draft new documents. Changing the beneficiary — whether you are leaving the assets to someone completely different or are adding beneficiaries — is a simple and easy process.

More Control Over How Your Assets Are Distributed

If you die without an estate plan, your assets automatically pass to a relative, such as a spouse or an adult child, depending on what living family members you have. If you have no family, the estate reverts back to the state of New York. For those who want to ensure that their assets go to a specific place — such as a charity — or person, a trust allows them to make those decisions early on and set everything up so that there’s no confusion later on.

Lower Taxes

Many people choose to use trusts as a way to protect their assets from estate or gift taxes. When done properly, a trust can make a significant difference in how taxes are handled on your estate and assets, which can preserve more of your wealth and assets for your children and other beneficiaries. However, it’s important to recognize that tax laws are complex. If you are planning on using a trust because of the lower tax implications, you need to work with an experienced estate planning attorney who understands which type of trust is your best option and can help you set things up correctly.

Ensure Your Estate Plan Meets Your Needs

While it may be tempting to try to create an estate plan on your own, it’s important to talk about your wishes and the best way to ensure they are carried out with an estate planning attorney. These lawyers have extensive experience helping clients understand their options, and they know what questions to ask and what potential challenges may come up to plan for.
At Davidov Law Group, we understand how important it is for you to know what’s going to happen to your assets after your death. We can help you create an estate plan that works for your situation and let you know if a trust may be applicable and beneficial for you. Call our New York office at 516-928-6594 to speak to a member of our team to schedule a consultation to discuss your options.