Railroad Pensions

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Retirement benefits are one of the assets that may be up for division in a divorce action. If you or your spouse was a railroad employee, there are a few things to keep in mind with respect to equitable distribution of a railroad retirement benefit. First, railroad retirement is comprised of two components: Tier I and Tier II. Tier I s comparable to a social security benefit. This benefit is not divisible as part of a divorce. Tier II is more akin to a traditional pension. The Tier II portion of the benefit is subject to division with proper court order.  Some companies may also offer supplemental pension benefits. All non-Tier I benefits can be divided in a divorce.

As indicated above, to divide non-Tier I benefits, an appropriate court order is required. The order needs to be specific about the request for division of benefits under the Railroad Retirement Act and include a fixed dollar amount or percentage as to the amount to be paid directly to the former spouse. It is important to work with an expert to ensure the court order concerning division of the retirement benefits meets all requirements established by the Railroad Retirement Board. In addition to division of non-Tier I benefits, former spouses might also be eligible for a separate annuity from the Railroad Retirement Board. Receipt of this separate annuity does not impact the amount of any annuity due to the employee. There are a list of requirements that must be met in order to qualify for the separate former spouse annuity.

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What Must I Do as Executor or Administrator of NJ Estate?

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The first step is to appear before the county surrogate to probate the will. The earliest you can initiate probate is after at least ten (10) days have passed since the date of death.  The original will is required along with death certificate. You should also have an idea of the estimated value of the estate and list of all beneficiaries or heirs at law with addresses and ages.

Once you are authorized to handle the estate by the surrogate, you need to send notice to all beneficiaries and heirs at law to put them on notice of where the probate has been initiated and your role as the executor or administrator. You will need to file proof of notice with the surrogate. This notice should be provided within sixty (60) days from your appointment.

Next, you can begin managing the assets and debts of the estate. You should open an estate account to collect all the assets. Where there is real property, you may need to arrange for sale. Debts of the estate can include tax liabilities as well. An individual tax return should be filed for decedent. Explore if an inheritance tax return needs to be filed as well. The will may direct that any inheritance  tax assessed is paid out of the estate prior to distribution to beneficiaries. An inheritance tax return should be filed within eight months of death to avoid penalties and interest.

Distribution of the net estate can begin as soon as practical following reconciliation of all debt and collection of all assets. If beneficiaries agree with proposed distribution, have them sign a refunding bond and release to receive their bequest. The release should then be filed with the court. If there is any dispute about administration of the estate and proposed distributions, you may need to complete an accounting demonstrating all steps taking during administration and all funds in and out.  By April M. Townsend

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Estate Liability

As the executor or administrator of a decedent’s estate, you’ll need to review any outstanding debts or liabilities owed by the decedent. These expenses should be paid out of the estate prior to making distributions of assets to intended beneficiaries. One way of identifying any debts owed is to monitor the decedent’s mail for statements that come in. In an increasingly digital world, it may be even more productive to have log-in information to review online statements for accounts. Finally, notice of the estate can be published in the newspaper. Any creditors would have one year to submit their claim against the estate for outstanding debts.

 

Medical expenses must also be considered. This is especially important if the decedent was in-patient at a facility prior to their death. To the extent their long-term care was subsidized by the government funds, a claim may be assessed against the estate for the costs of the care. Both Pennsylvania and New Jersey have an Estate Recovery Program permits the state to pursue compensation for medical assistance provided to the decedent. As executor or administrator, you should also check that no outstanding funds are due if the decedent utilized subsidized long-term care. Certain expenses of estate administration can also be paid by the estate. This may include fees paid to the court of the estate process, fees paid to an attorney to handle the estate, or even fees paid to an accountant for preparing tax returns. Work with an experienced estate attorney to understand your obligation to manage the debts of the decedent if appointed as executor or administrator. by April M. Townsend

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Ancillary Probate

Ancillary probate is the probate process that occurs in a different jurisdiction that the primary probate because the decedent owns  real estate that is located outside of their state of residence. Ancillary probate may also be necessary to address tangible property that is registered and titled outside the home state, or livestock, oil, gas or mineral rights that are attached to real estate located outside of the home state. The same individual that was appointed to handle the initial estate administration is the individual who must handle ancillary probate.

To initiate ancillary probate you will need to present a copy of the will and/or proof of probate proceedings from home state, certified copy of the death certificate, copy of the deed for real estate or or proof of other tangible property that is the subject of the ancillary probate. There are often additional fees assessed by the jurisdiction where the ancillary probate is filed.  by April M. Townsend

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Alternatives to Estate Administration

In certain circumstances where the decedent did not have a will, surviving relatives may be able to handle their affairs without going through the probate process. If the decedent is survived by a spouse and the value of their estate is less than $50,000, the spouse can file an affidavit with the court. In addition to information regarding the assets of the estate, the spouse must also have a death certificate. A Child Support Verification is required in every case. This form puts parties on notice that any outstanding arrears are to be satisfied prior to disbursement of funds to any beneficiary that owes child support.  The affidavit only permits the spouse to handle the assets listed. If more assets are subsequently discovered and pushes the value of the estate over $50,000, formal probate will be required.

If the decedent was not married, their next of kin can submit an affidavit where the value of the estate of the decedent does not exceed $20,000.  Consents must be obtained from other next of kin of equal degree, if applicable, to enable the affidavit to be submitted. All surviving heirs should be supplied in the affidavit information sheet including degree of kinship, addresses and ages. Any deceased next-of-kin and their issue must also be named. Otherwise, the same rules apply as discussed above with respect to child support verification and what happens if additional assets are discovered over $20,000 limit.  By April M. Townsend

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Audit and Adjudication

An audit is scheduled when beneficiaries do not agree on how an estate should be distributed or there are questions regarding the estate. An accounting is filed with the court to obtain an audit hearing. The accounting should detail all the assets and debts of the estate to the penny. This is to ensure the executor or administrator properly handled the estate. A copy of the will, if applicable, should be attached along with proof of publication of notice of letters granted. Also, confirmation that notice of the audit was sent to all interested parties prior to the audit date is required.

At the time of the audit, if there are still objections or concerns, the matter will be scheduled for further proceedings to resolve the outstanding issues. If there are small issues or discrepancies, they can potentially be addressed that day so the estate can be resolved. If there are no objections or questions at the time of the audit, the executor or administrator should present a petition for adjudication to the court. The petition will include the proposed distribution of the estate and whether any reserve is being held for future expenses.  By April M. Townsend

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Attendance at Adoption Hearing

Several individuals are required to attend a scheduled adoption hearing. Pursuant to 23 Pa. C.S. Section 2723, the adopting parents and adoptee must appear at adoption hearing and testify under oath where required. In addition to these individuals, the court may direct that all persons whose consents were required, or any agency or intermediary involved, appear as well if their testimony would be necessary or helpful to the court. Consents are required of spouse of adopting parent (if not joined in petition), parents of adoptee under the age of 18 years (if their rights have not previously been terminated), and guardian of incapacitated or underage adoptee.

 

Testimony at an adoption hearing is for the purpose of verifying statements in the adoption petition and providing information to the court regarding the desirability of the proposed adoption. The court may inquire regarding the relationship that has been established between the prospective parents and the adoptee. The court may also question the prospective parents as to their understanding of the permanency of adoption and legal benefits conferred by establishing parent-child relationship. If satisfied that needs and welfare of adoptee will be served by the adoption, the court shall enter a decree grating the adoption.

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Alternate Service in Adoption

It is always necessary to give all interested parties proper notice of pending adoption proceedings. A copy of the adoption petition should be served on all interested parties, e.g. persons with parental rights to the minor child(ren) involved. If you do not have a good address for an interested party, there are other alternatives to provide notice. First, you will need to demonstrate a need for an alternate method of service and petition the court to get permission. The usual method of alternate service in a situation where the current whereabouts of a party are unknown is publication in the newspaper where the party was last known to reside.

The court’s order permitting publication would dictate for how many weeks the notice must be published in the newspaper. You should be careful to include all necessary information in the publication so that the court can accept the publication as acceptable method of alternate service. The newspaper subsequently provides an affidavit confirming the publication. This affidavit should be submitted to the court as proof that the required publication was completed. Using publication as an alternate method of service does increase the costs of the adoption matter as it can cost several hundred dollars to publish in the newspaper.  By April M. Townsend

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Alimony

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Alimony is support paid to an ex-spouse following divorce. The amount of alimony is usually based on the incomes of the parties. It is not uncommon for the amount of alimony to be considered in the context of the equitable distribution of marital assets, if any. Unless otherwise stated by agreement, the amount of alimony may be modified due the changed circumstances of either party. These changes must be substantial and of a continuing nature. Parties reaching their own agreement for alimony may contract for non-modifiable alimony.

The duration of alimony is based on the length of the marriage. For example, a party may expect approximately 1 year of alimony for every 3 years married. For marriages of over 25 years, an indefinite term of alimony may be appropriate. If the parties include alimony as a part of their own settlement agreement, they are free to set the amount and length of the alimony as they so agree. Previously, alimony was a tax deduction for the party paying the support while the party receiving the support had to claim it as income. Pursuant to the Tax Cuts and Jobs Act, alimony is no longer a taxable event. This change in the tax treatment of alimony became effective January 1, 2019. If your Order for alimony was entered prior to that date, the prior rules will continue to apply.  By April M. Townsend

 

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Advertising for Estate

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Probate is the process of handling an individual’s estate after they pass away. If the individual had a will, it should name an executor. An executor is the person designated to be responsible for the administration of a person’s estate. If the individual did not have a will, their next of kin can apply to be appointed as administrator of that individual’s estate. Part of the probate process is advertisement of the estate. The purpose of advertisement is to put any interested parties on notice of the death of the decedent.

Two types of advertisement are needed. First, notice should be published in the local law reporter for the county where probate is initiated. Second, notice should be published in a newspaper of general circulation within the county. Proper advertisement protects the executor or administrator in terms of their fiduciary responsibility to properly carry out the estate. After one year from date of advertisement, creditors can no longer make a claim against the estate and the executor or administrator can feel confident in making any distributions of the estate after that point.  By April M. Townsend

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