FEATURES & NEWS

ILITs Unveiled: Estate Planning
Estate Planning

Why Is Everyone Talking About ILITs?

Why Is Everyone Talking About ILITs? In the evolving landscape of estate planning, Irrevocable Life Insurance Trusts (ILITs) have emerged as a buzz-worthy topic among

Read More »
About Elder Law in New York
elder law

About Elder Law in New York 2024

Elder Law in New York 2024: A Comprehensive Guide As the population ages, the importance of elder law—an area focusing on the legal needs of

Read More »
Will And Trust In New York
Wills and Trusts

Will And Trust In New York 2024

Wills and Trusts in New York: Your 2024 Comprehensive Guide As we approach 2024, the estate planning landscape in New York continues to evolve. Understanding

Read More »
Elder Law in NYC
elder law

Elder Law in NYC 2024

Elder Law in NYC 2024: Navigating Legal Challenges with Morgan Legal Group As 2024 approaches, navigating the complexities of elder law in New York City

Read More »
Probate in New York
Probate

Probate in New York 2024

Comprehensive Guide to Probate in New York 2024 As we step into 2024, the probate process in New York City continues to be a pivotal

Read More »
Estate Planning
Estate Planning

Estate Planning in New York 2024

Estate Planning in New York 2024: A Comprehensive Guide by Morgan Legal Group The landscape of estate planning in New York is ever-evolving, with 2024

Read More »
Article 81 Guardianship New York
Estate Planning

Article 81 Guardianship New York 2024

Article 81 Guardianship in New York Article 81 guardianship in New York plays a crucial role in safeguarding the interests of incapacitated individuals. As we

Read More »
Is trust better than inheritance?
Trusts

Is trust better than inheritance?

Is Trust Better Than Inheritance in New York? When planning to transfer assets to future generations in New York, individuals often decide between establishing a

Read More »
Can I do my own probate?
Estate Planning

Can I do my probate?

Can I Handle Probate on My Own in New York? Probate is the legal process of validating a will and administering the estate of a

Read More »
An Overview Of Elder Law In 2024
Estate Planning Law

An Overview Of Elder Law In 2024

An Overview of Elder Law in New York 2024 Elder Law is a specialized legal field that addresses the unique needs and challenges faced by

Read More »
How do I organize my estate documents?
Estate Planning

How do I organize my estate documents?

Organizing Your Estate Documents in New York Organizing your estate documents is a crucial aspect of responsible financial planning and ensuring that your wishes are

Read More »

Estate Planning

Estate Planning is the process of making arrangements on how the assets of a person would be managed in the event of incapacity or demise. A will is simply a document stating the intentions of a testator (the deceased) on how his/her estate should be administered or managed in the event of his/her demise.

Second Marriage as regards Estate Planning

Second marriage the state or practice of being married to more than one wife or one husband at a time. — bigamists. a second legal marriage after the termination of a first marriage by death or divorce.Remarriage is a marriage that takes place after a previous marital union has ended, as through divorce or widowhood.

What to be considered

Everyone believes in second chances. Second chances can bring a lot of joy, especially in the context of getting remarried. In fact, blended families now outnumber traditional families, according to the U.S. Census Bureau. This is not just because of rising divorce rates – our longer life spans mean that many more people are outliving their spouses and remarrying. However, second marriages bring with them unique challenges, and the need to have comprehensive estate planning becomes increasingly important. It is likely that in your first marriage, you and your spouse generally had the same goals when it came to your estate planning: taking care of the surviving spouse during their lifetime and then leaving whatever assets remain to your children. Now, not only do you have to take into consideration the needs of your new spouse, you also have to consider the needs of your children from your previous marriage and possibly the needs of children from your second marriage.

Wills:

In Oregon, when a person becomes married, his or her existing will is automatically revoked. So, even if you updated your estate planning documents after your divorce, a remarriage may require you to take a second look at your existing estate plan.

Beneficiary Designations:

Certain assets let you name a beneficiary and are not controlled by a will or trust. These assets include life insurance policies, employer retirement plans, IRAs, annuities, and certain investment and bank accounts. You most likely named your spouse as beneficiary when you were married. Given the fact that you have remarried and may have additional children, updating your beneficiary designations is critical: beneficiary designations will override a will or trust if the documentation isn’t consistent. What does this mean? It means your ex-spouse will receive the assets if he or she is still named as the beneficiary!

Qualified Terminable Interest Property (QTIP) Trust:

A QTIP Trust is a type of trust that can provide for your new spouse until his or her death or remarriage, with the remainder of the assets passing to the beneficiaries of the trust – usually your children (though you can name anyone). The surviving spouse is entitled to the income produced by the trust during their lifetime, but the surviving spouse does not have full ownership of the trust assets and cannot sell them or give them away. In addition, these are special IRS-favored trusts that have special estate tax implications. The benefit of a QTIP trust for a second marriage is that it provides for flexibility in treating beneficiaries, can save assets for children of a previous marriage, and can generate tax savings and deferrals of estate tax in taxable estates.

Irrevocable Life Insurance Trust (ILIT) :

 An ILIT is an irrevocable trust that is both the owner and beneficiary of one or more life insurance contracts. An ILIT could be a way to prevent conflict in your blended family because it would provide for an immediate death benefit to whomever you designate as beneficiaries (most likely your children from your first marriage), instead of forcing children to wait for your spouse to die before having access to assets (as is the case with a QTIP trust). Then, the remainder of your assets would be available to your spouse and perhaps children from your second marriage. As an added bonus, because the insurance proceeds are not part of your estate for estate tax purposes, an ILIT is a useful tool to avoid state and federal estate taxes.

Power of Attorney and Health Care Directive:

 Now that you are remarried, you want to make sure that you have designated the proper person to make financial and health care decisions for you in the event you become incapacitated. In many cases this will be your new spouse. In Oregon, divorce does not automatically revoke a power of attorney, so failure to update your estate planning documents could cause your ex-spouse to serve as your agent.

Most people think that their situation is “too simple” to necessitate any estate planning. In the case of second marriages, this thinking could not be further from the truth. Estate planning in second marriages presents many challenges and requires the assistance of well-qualified estate planning attorneys to ensure your goals are achieved.

Get help

If you would like to learn more about the necessity of estate planning for second marriages, any one of our estate planning attorneys would be happy to assist you.

Most Popular: