When Is A Person Legally Incapacitated?

One of the most important components of the estate planning process is getting it done before it’s too late. When is it too late? Much of the time, the answer is not “when death occurs.” Instead, people are often ruled legally incapacitated by the courts long before they pass away. If the owner of an estate becomes legally incapacitated before making a plan or naming beneficiaries, then upon death the process kicks over to probate court — and that means a judge will make the decisions on your behalf, regardless of what you wanted.

Cadence Bank’s Trust and Management Executive Patrick Pacheco said, “People want to believe their family gets along pretty well and there won’t be any issues, but they are all just a collection of people. These folks have their own families and their own advisor, spouse or otherwise, whispering in their ears about what should happen or not happen. Will contests and incapacity or guardianship contests are the most bitter suits you ever get, and most of the time, control of the money is a driving factor.”

Sadly, those lawsuits are commonplace after a close family member passes away without going through the proper estate planning channels.

A person is legally incapacitated when they no longer have the physical or mental capabilities to properly communicate their wishes. This most often occurs when mental illnesses like dementia or Alzheimer’s disease ruin someone’s ability to think clearly. While that sounds simple, the ultimate determination often ends up in court when someone hasn’t named power of attorney.

Pacheco said, “If you are incapacitated, legally or otherwise, you won’t be able to sign contracts, estate documents, checks or anything of substance or do anything without help. The only thing you definitely want to avoid in almost all circumstances is a guardianship, because it is a court proceeding that requires budget approval, investment approval and spending approval. It can cost you, or more correctly the guardianship estate, a lot of money because court proceedings tend to ramp up all costs pretty quickly.”

That’s why you want to name a durable power of attorney while you’re still young. This person should be trustworthy, good with money, and reliable when carrying out your wishes. Most of what you want them to do should already be on paper when you name the person, so the responsibility will be mitigated somewhat. Still, don’t be upset with someone who doesn’t want to do it. It’s a big ask.

Your power of attorney will likely work in combination with a living will, which defines what can and cannot be done if incapacitation should occur.

Can My Estate Planning Lawyer Help Me Draft An Elder Abuse Lawsuit?

There are a lot of complicated subjects surrounding our loved ones as they grow older. That’s because with increasing age comes an increasing need for protection. Sometimes we share these tasks with specialized caregivers — who may or may not have our loved ones’ interests at heart. When those caregivers break our trust, we need to act fast. But how? Well, it just so happens that many estate planning lawyers also specialize in elder abuse. 

These practice areas are like pieces of the same pie.

Take a recent lawsuit lodged by Terry Ann McIntosh and her lawyers, for example: she was 75 years old and confined to a wheelchair when circumstances finally required the services of a full-time caregiver. The person who arrived to help perform all the daily tasks McIntosh couldn’t do for herself was a young woman — an innocent-looking enough young woman at that. But innocence was just a facade in this case, and McIntosh soon found her bank account under attack.

The caregiver tried to transfer a whopping $10,000 from McIntosh’s bank account into her own. The transaction was immediately marked as possible fraud by the managers at Bank of America, and they blocked it pending the confirmation of McIntosh’s identity via a phone call. The caregiver subsequently committed identity fraud, pretending to be McIntosh. She even failed those security questions with which we’re all so familiar! But Bank of America lifted the fraud alert anyway. The caregiver had just won her $10,000 payday.

The next 44 money transfers were much easier after the alert was lifted. The caregiver managed to pilfer about $245,000 during those more successful attempts, spending almost all of it before she was finally caught by the police, charged with grand theft and identity fraud, and convicted on both counts. McIntosh received only $8,000 of the stolen funds. She requested the money from Bank of America, whose security measures had proved insufficient, but Bank of America denied the request.

What’s important to understand is that this kind of theft is even less common than more organized theft committed by bigger organizations of people.

Director of elder abuse prevention at the Institute of Aging Shawn Reeves said, “This is big business, perpetrated by actors people think are legitimate.”

Des Moines Assistant Attorney General Chantelle Smith said that complaints are based on “any type of business you can imagine.”

That’s why it’s so important to seek out the qualified services of an estate planning or elder abuse attorney when delving into thefts of acts of fraud like the aforementioned. Even if you so much as suspect that such criminal acts are taking place, it’s worth your time to find out for sure.

Should You Attend An Estate Planning Workshop?

In larger communities, it isn’t uncommon for attorneys to offer their time for estate planning workshops designed to teach learners what they might not already know about the subject. The attorneys have ulterior motives, of course, but estate planning is also an oft-misunderstood subject that many of us believe is just for rich people. That couldn’t be further from the truth. Should you attend one of these workshops? 

It depends on how much you know and how well prepared you are for your family’s future.

Typically, workshops will offer a run-down of essential estate planning techniques, annual alterations to previously made estate planning documents, tax laws, and options to reduce the tax burden sustained by donating to charity.

William K. Hayes, Esq. of the Hayes Law Firm said, “Even if you don’t have many assets, you want to make sure that you have all the proper estate planning documents in place that will give written instruction as to what you want to have happen to you if you are in a car accident or if you get some type of a debilitating chronic illness that requires Long Term Care. Your estate planning should account for long-term healthcare costs. If you haven’t prepared for long-term healthcare costs, then you really haven’t planned at all.”

Other commonly discussed topics include: the potential for internet plans ending up in court, living trusts, inheritance obstacles, common mistakes and pitfalls, long-term care opportunities, protecting assets, avoiding court supervision when impaired, and protecting a child’s inheritance.

Fiorito said, “Estate planning is unlike any other area of law and is something that really does apply to every single person on the planet, each of us will die at some point. For those with minor children, it is especially important to designate a legal guardian who you feel comfortable raising your children should the circumstance arise. Parents who choose not to properly plan, are subject to having court-appointed guardians care for their children.”

Many law firms are dedicated to holding these workshops at monthly seminars, but they are normally coupled with community education projects. If you are interested in this type of workshop, you might start researching online or looking at education services offered through local high schools or community colleges. Many workshops are free or cost a nominal fee. 

Without the proper estate planning, the probate court system will almost always decide how your assets are divided when you die — and that means the people you would have listed as beneficiaries if you had “gotten around to it” won’t necessarily get their due. 

Should Estate Planning Include The Family Pet?

If you’ve been online at all during the last seven days, you’ve probably noticed how many people were posting cute pictures of their dogs — because it was National Dog Day. For some reason it went viral on Instagram and Facebook this year more than any other. It also begs the question: is the family pet actually a member of your family? That’s what you need to ask yourself when deciding whether or not to add them to your estate plan.

If the answer is a resounding “yes” — and for most people that’s the case — then you’ll probably want to include Fido or Fluffy when drafting your last will and testament or speaking with an estate planning attorney.

What exactly does that mean?

Basically, it means making sure your pet is cared for after you pass away. You do the same for your kids, parents, spouse, and other close relatives, so why not your beloved cat, dog, or cockatoo? That’s why you can name a pet in your will. Legally, a pet is classified as property, which means the best shot of ensuring your pet gets where you want him to go is to decide for yourself.

Lots of pets end up in a shelter after their owner has died. If you don’t want that to happen to your pet, then it’s time to look for someone who would agree to look after him now rather than later. Before naming a pet in your will, be sure to ask your friends and family who would want him. Name someone who doesn’t want your king cobra and that poor, adorable snake will probably end up out in the cold anyway.

Although you can’t set up a trust fund for a pet the same way you can for a beneficiary, what you can do is leave money or assets specifically for the care of that pet. This becomes easier by setting up a trust fund that cannot be accessed unless by someone who owns and cares for the pet. This is especially necessary if your pet is getting older and needs more care.

The least popular option is placing your pet in the care of a facility that prides itself on taking care of animals after their owners pass away. If your pet is a member of the family — then that’s probably not the way you’ll want to go as long as their are other options available.

Alternatively, you can opt to leave your pet out of the will entirely. In this case you’ll want to put a “non-legal” arrangement in place with a trusted friend or family member. Keep in mind that these arrangements are entirely non-binding and there is nothing to keep the other party from reneging on their end of the deal when you’re no longer around to do anything about it. 

Everything You Need For A Great Estate Plan Your Beneficiaries Will Love

Estate planning is a simple endeavor for those who have known nothing but riches their entire lives. Some of us have worked for every penny we have, which can sometimes make estate planning seem like a way to capitalize on a lifetime’s worth of toil so that our beneficiaries can live easier in the future. Still, it can be a depressing process because few people want to consider a world that does not include yours truly. But it is necessary.

These are a few steps you will want to take in order to see the best outcome for your beneficiaries.

  1. Speak with beneficiaries. This might result in a few awkward conversations, but you may not want to surprise beneficiaries with an inheritance. Ensure that someone knows what you have and where you want it to go in order to reduce the chance that someone will contest your estate plan; doing so might kick the entire affair over to probate court, in which case a judge will have the ultimate decision-making power.

  2. Write A Last Will & Testament. This can be done electronically (online) without a lawyer present, but you may want to sit down with someone for a free consult in order to make sure you do not make any mistakes. Make a simple list of big ticket purchases like vehicles or homes before moving on to smaller, more sentimental items and trinkets that you may want to leave your friends and family. Don’t forget to include any investments or bank accounts when considering your assets. All these should be included in the legal document, and it should be updated whenever you procure new assets or lose old ones.

  3. Execution and Power of Attorney. When you’re done drafting a will, start thinking about who you trust enough to execute your wishes. This can be a close friend or family member, or even a trusted financial advisor or attorney. This is the person who will make sure your assets are distributed according to your wishes. The same individual might make a good Power of Attorney, or you might wish to let someone else handle the responsibility. This person will make decisions for you when you cannot make them for yourself — such as when you are physically or mentally impaired because of old age or after an accident.

  4. Trusts. Creating a trust for each beneficiary is one of the best moves you can make to determine where your assets go and whether or not they can be used. You might make an inheritance available to a grandchild for college — or bar that inheritance from being used in the event the grandchild opts to forego continuing education. With trusts, it doesn’t matter if you are still alive. The trust will kick in according to the conditions you set.

Tricks Of The Trade Every Estate Should Keep In Mind When Planning For The Future

Imagine this: you’re an individual whose family has always been about lower means. You don’t have much money, nor do you need it because you know how to stretch a dollar. Suddenly you win a multimillion dollar lottery draw. Your life has changed, but you don’t know whether for better or worse because the scope of what you can pay for is drastically different than it was before. Would you know what to do? Would you know who to ask? The answer is simple enough. You need an estate planning lawyer.

Be wary of financial advisors. Many are only out for themselves, trying to make a quick buck off people who don’t know any better. They might try to take control over your slew of new investments. They might try to sell you a service for commission. Don’t fall into their trap.

These are the things you need to keep in mind:

  1. Your goal when estate planning is to minimize your overall taxes so that the beneficiaries who inherit the estate won’t have an enormous financial burden when the time comes. Your estate planning lawyer will help you consolidate assets or create separate accounts so the process is easier. An estate freeze may be put into place to ensure taxes do not grow more than they should, depending on where you live.

  2. Life insurance will sometimes help. Your attorney will help you calculate the tax burden with or without a good life insurance plan.

  3. A family governance plan will help when consolidating those assets. Not only will overall cost of maintenance go down over time, but each beneficiary will be held accountable for specific aspects of maintaining the estate.

  4. Drafting a proper will and allocating power of attorney is an important step in the estate planning process, but many of the wealthier estate owners will fail to keep these documents current. If there are disputes when the estate owner dies because the will isn’t specific enough, then the contested articles automatically get kicked to the probate courts. That means a judge makes the final decision about how to divide those assets.

  5. Decide who will preside as executor over the estate plan once you’re gone. Most people who leave behind a smaller estate will give the responsibility to a trusted family member. As the estate grows, many people will decide to instead give the responsibility to an attorney who has all the relevant documents anyway.

  6. Consider placing money into trusts for beneficiaries; especially those who are younger. You can provide prerequisite instructions for how this money is to be divided up. Will a beneficiary get it all at age 18? Or will he get a slice now, and more when he’s older and wiser? It’s up to you.

The Four Fundamental Questions of Estate Planning

As we get older, we may obsess over our appearance, dying our hair, getting plastic surgery, etc. Some of us go into health mode and start a new diet and working out to prolong the inevitability of death. However, it would be surprising to learn that many people think about their estate plan. If you are getting older and are considering creating an estate plan or if your loved one is near retirement age, these are the four fundamental questions you need to ask:

Do you have your estate planning documents in place? Basic estate planning documents include last wills and testaments, powers of attorneys, healthcare proxies, and living wills.

If you do have them in place, where are they located? Having an estate plan is one thing but if it can’t be found in a moment of crisis can make it difficult for friends and family. A good estate planning attorney should have a copy for their records. Do not put documents in a bank deposit or safe that cannot be accessed after death.

What are your assets? Once passed, an executor will be in charge of gathering all the assets and doling them out according to your wishes in your estate plan. It is helpful to know exactly what your assets, in fact, are, as well as your debts. Assets including everything from property to bank accounts and debts include credit card to loan. It will be the burden of the beneficiary to pay for the debts.

What do you want to do with your body? Funerals are sadly expensive. By having the details of your funeral written and secured with the estate plan, along with funds saved for it, will make this burden easier on your family and friends at the event of your passing.

For more information about creating an estate plan, contact our attorney for a free consultation.

Estate Planning Could Have Saved President Trump Millions Of Dollars (Legally)

Estate planning is a simple concept. For those whose families aren’t wealthy enough to incur any estate taxes at the time of their death (this is the case for almost all of us), you might only require an estate planning or probate lawyer in order to set up a legal will and last testament or determine power of attorney in cases during which you’re incapacitated and need someone who you trust to make the important decisions for you.

For others, estate planning is a way to conserve assets. The process is complicated and convoluted, but it helps save families a lot of money by avoiding taxes they might otherwise have to pay. Sometimes it helps keep businesses alive. With the right estate planning lawyer, the probate courts can be avoided down the road. More importantly, it’s a legal path.

Donald Trump and his family decided to go another way. Instead of using estate planning lawyers to their advantage, he and his father set up a sham company in order to hide money and dodge taxes throughout the 1990s. This, after claiming that his fortune was “self-made” and that he had no help from his father, from whom he inherited about $413 million worth of real estate.

Trump was allegedly in part responsible for the devisement of a plan to undervalue those real estate holdings. Subsequently, the taxes were reduced substantially when the estate passed to him and his other siblings. All the children together received over $1 billion in assets, but paid only $52.2 million in taxes even though the typical tax rate of 55 percent would have resulted in a $550 million bill. Not surprisingly, Trump doesn’t have much to say about these accusations, save to say that no one cares about his tax returns.

One of Trump’s lawyers was quick to contend how these allegations are false, and borderline defamatory. He made this claim by arguing that Trump had delegated the tasks to others, and that it was really those individuals and possibly the other members of his family who had potentially broken the law. Sure thing, that’s a likely story.

Experts take note that Trump will likely never be prosecuted under criminal law because the statute of limitations has elapsed. Although this will likely also reduce the chances of an investigation, if one were to take place then he might be liable for civil fines that stem from tax fraud or tax evasion.

What The New 2018 Estate Planning Law Might Mean For You

Estate planning laws have always been complicated, and some of you may not even know that the laws are a little bit different in 2018. In particular, the estate tax exemption has been raised to $11 million if you file as single. If you’re married, it may have been raised to $22 million based on your selections during planning.

Before the new law, it was thought that the tax might be eliminated altogether. That turned out not to be the case, and for most of us the differences won’t matter. Estate planning is for the wealthy. Most people who need estate planning or probate help use simpler, easier services that making writing up wills and trusts a lot easier.

There is an annual amount that you can exempt from taxes by declaring it a gift. You can declare this tax exemption because you are, in effect, choosing to let your assets diminish by the amount of the annual gift, which helps your unified lifetime credit for gifts go up each year. If single, you can “give” away $15,000. If married, the amount increases to $30,000. Believe it or not, you can do this without filing any gift tax returns. You only need to do this when you give a gift that exceeds the maximum gift allowance.

Even so, there are things you can do in order to relieve yourself of the estate tax. If you choose not to engage with estate planning services, then you should realize that any family you leave behind will be forced to endure the probate process, which is basically the court’s decision. Extensive estate planning will help avoid that process, and grant you the power to do what you want with the assets you earned after a lifetime of work.

The 2018 law doesn’t change much else about the estate planning process. Keep in mind that each state has its own estate planning tax laws, which might reduce, increase, or eliminate the tax altogether. In order to find out how estate planning can work for you, consult with a qualified attorney as soon as possible. There’s no such thing as planning for the future too early.

What Is An Educational Trust?

Probate is all about planning for the future. What do you want to leave behind for your living heirs? What kind of legacy will they remember when they think of your name? It’s all up to you, but you have to make plans while you have the chance. One way of providing beneficiaries with an inheritance is to set up a trust.

A trust can be used to get around what would otherwise be a solid wall of taxes. It’s a fiduciary contract that allows a trustee to hold or manage money or other assets for your beneficiary. There are a number of different types of trusts that you can use to transfer wealth in a variety of ways. One such type of trust is an educational trust. Funds placed in this kind of a trust can only be used for education. The person who is transferring assets into the trust decides who will get the money and who will control it until that happens.

Often, the funds will only be funneled into the trust upon the death of the grantor. Or sometimes the grantor decides to transfer money immediately. You might do this if one of the beneficiaries was set to go to school soon. The trustee might be different from the beneficiary, and when the trust becomes operational the trustee is responsible for providing the required money to the beneficiary depending on the terms of the trust.

If you decide to set up an educational trust, there are a few questions you need to answer:

Will you set up the trust for one beneficiary? Multiple?

Who will be the trustee?

When will the trust go into effect?

What kind of education will the trust require? You determine any requirements the beneficiary might need to keep in mind. You can decide to offer the money only for a full-time legal student or you can support any education at all. Your choice.

When will the trust be terminated? You will need to determine what happens if there are remaining funds when the beneficiary completes an education. Then again, you’ll need to decide what happens if the beneficiary decides not to acquire an education. Will the money go to a new beneficiary if the first dies or is unable to complete the terms of the trust?

There are a number of options, and you must weigh them all before you can set up a reliable trust!