The Elder Law Minute TM
Handling the Debt of One’s Estate
ELDER LAW
THE ART OF ELDER LAW
For more than 30 years the elder law firm of Ronald Fatoullah & Associates has been providing
New Yorkers with legal solutions that protect, relieve and endure for generations.
Our dedicated attorneys are skilled in the art of giving legal advice and are accomplished in
elder law, Medicaid eligibility, estate planning, trusts, estate mediation, wills, asset protection,
guardianships, probate and most issues associated with the challenges of aging.
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standards and our core values of honesty, integrity, and excellence.
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1-877- ELDER LAW
1-877-ESTATES
Queens Long Island Manhattan Brooklyn
20 DECEMBER 2017 | WWW.QNS.COM | LEFRAK CITY COURIER
ATTORNEY ADVERTISING
BY RONALD A. FATOULLAH, ESQ.
AND DEBBY ROSENFELD, ESQ.
Drafting and overseeing the execution
of wills are standard activities
in most elder law and estate planning
firms. The main purpose of a will is
to direct how an individual’s assets
shall be distributed after he/she dies.
Nonetheless, a will can also be used for
other purposes. Th rough a will, an individual
(‘testator”) can provide instructions
as to how his/her debts should be
paid and disposed of. Typically, a benefi
ciary or heir cannot inherit another
person’s debt, but if an individual
dies with debt, it ultimately reduces the
amount that each benefi ciary receives.
Articulating and clearly delineating how
the debt of one’s estate should be paid
is ultimately very helpful to the various
benefi ciaries.
If a person dies (the “decedent”) with
outstanding debt, the executor appointed
in the will is responsible for making
sure those debts are paid. Paying off a
decedent’s debt may require the executor
to sell some of the assets held by the
estate, and the decedent may have wanted
to specifi cally leave such assets to
designated benefi ciaries. Th ere are two
types of debts that a person can leave
behind:
Secured debt, which is debt that is
attached to a piece of property or an
asset, such as a car loan or a mortgage.
If the debt is not paid off , the lender
can ultimately pursue the actual asset in
order to be made whole; and
Unsecured debt, which is any debt
that is not backed by an underlying
asset, such as credit card debt or medical
bills.
If an individual owns an asset that
is subject to debt and leaves such asset
to benefi ciaries, the debt remains with
the property. Th e benefi ciary can then
decide whether to continue to pay on
the debt or sell the property to pay off
whatever is outstanding. If a person
believes that an inheritance encumbered
by debt would cause a burden for his/her
heirs, language can be added to the will
to specifi cally address these concerns.
If, for example, the estate is comprised
of real property, the testator can designate
that one specific property be sold
in order to pay off any debt attached
to other properties. In the alternative,
the testator can indicate that each
beneficiary is responsible for any debt
attached to the property received. By
clearly instructing how debt should
be handled, the testator can avoid any
bad feeling or misunderstandings upon
his demise. Instructions allow for a
peaceful and uneventful distribution
of assets.
Ronald A. Fatoullah, Esq. is the principal
of Ronald Fatoullah & Associates,
a law fi rm that concentrates in elder
law, estate planning, Medicaid planning,
guardianships, estate administration,
trusts, wills, and real estate. Debby
Rosenfeld, Esq. is a senior staff attorney
at the fi rm. Th e law fi rm can be
reached at 718-261-1700, 516-466-
4422, or toll free at 1-877-ELDER-LAW
or 1-877-ESTATES. Mr. Fatoullah is
also a partner with Advice Period, a
wealth management firm, and he can
be reached at 424-256-7273.
RONALD FATOULLAH
ESQ, CELA*