This post was written by Michael F. Brennan -- an attorney at the Virtual Attorney™ a virtual law office helping clients in Illinois, Wisconsin, and Minnesota with estate planning and small business legal needs. It is a GREAT summary of the type of things that make up an "estate plan". Contact my firm to establish your estate plan today.
Estate planning doesn't have to be intimidating. In fact, most people are going to be in good shape with a few relatively simple documents. Here's what you should know:
When most people hear the term "estate planning" images of the Monopoly Man likely come to mind. Of course, the very wealthy are commonly associated with the estate planning process because they know how to benefit from a complex web of laws that enable them to most efficiently (and with the least amount of tax burden) leave their assets to future generations.
But estate planning is much more than trust funds and inherited wealth. A comprehensive estate plan can benefit practically anyone--from instructing family members who should care for minor children in the event of the untimely death or disability of the parents, to ensuring that one's medical wishes are followed. Of course, any estate plan will also direct where an inheritance should go, but that's never the only consideration. So what should you know about the process?
Well, there are a handful of documents that you should know about. Whether you're worth $1,000 or $10,000,000, the following estate planning documents are beneficial to have in place:
1) A Durable Power of Attorney for Healthcare (including HIPAA Release)
A power of attorney is a document in which one individual (the “principal”) grants another individual (the “agent”) the authority to act on his or behalf, often according to a specific list of directions.
When it comes to medical decisions, a durable power of attorney, permits the agent to make medical decisions relating to treatment on behalf of the principal and, properly drafted, it allows the agent access to the principal’s important medical records which may be necessary to consider when determining a course of treatment.
Without a valid durable power of attorney for healthcare in place, medical personnel have no obligation to follow anyone’s wishes regarding treatment or consent except for the patient’s. For married couples, this may not be as much of an issue as it is for other people, but it’s still important to cover your bases.
By executing a valid power of attorney, a couple can appoint each other to make heath related decisions if they themselves are unable to do so. The power of attorney ensures that your spouse will be able to take any action which you would be permitted to take on own behalf. Many states offer statutory forms that can be used if you know what you’re doing, or an attorney can draft one up very quickly with a few pieces of information.
2) A Durable Power of Attorney for Finances and Property
With a valid durable power of attorney for finances and property an agent should be able to access the principal’s bank accounts and financial records, pay rent, utilities and credit card bills, manage investments and loans and so on.
Without one, financial institutions like banks, utility providers or even landlords typically will not permit an individual that is not named on an account to access its funds or information. Of course, in the context of marriage, this is not as much of an issue as it sometimes is for single individuals. Nevertheless, it’s good to make one part of your plan to avoid any surprises down the road.
3) Law Will and Testament
If you want to direct where your possessions will go if you die, then it’s important to have a will.
If a person dies without a will, state law determines how the assets will be distributed. That will mean less money and more stress for the heirs—an unpleasant prospect for family members already dealing with the tragic death of a young person.
In addition, married couples enjoy a number of benefits when it comes to passing property upon death. While others need to consider the tax implications of leaving amounts over a certain threshold, spouses can leave unlimited assets to each other in a will. That means that upon the first death, substantial gifts left to an inheriting spouse will not be subject to hefty taxes. However, it’s important to involve an attorney here, as the death of the second spouse may bring with it a number of unwanted tax consequences. Strategic drafting of a comprehensive estate plan can fully utilize these benefits while also eliminating any unwanted consequences.
If you are married and do not have any children, then 9 times out of 10 your estate will go 100% to your spouse. If you or your spouse instead want to leave certain property or a little bit of money to other loved ones, then you’ll need a will to override the default intestacy laws.
4) Living Will
A living will is a legal document used to indicate which treatments you do or do not want applied to you in the event you either suffer from a terminal illness or are in a permanent vegetative state.
For example, you may indicate whether the use of feeding tubes or other life-prolonging equipment should be continued, or whether, at a certain point should be discontinued if there is no chance of recovery.
A living will does not become effective unless you are incapacitated; until then you'll be able to say what treatments you do or don't want. Without a valid living will, doctors may or may not rely solely on the wishes of your spouse when determining what course of treatment to pursue.
Drafting a living will is important so that nasty disagreements don’t occur if something happens to you.
5) Authorization for Final Disposition
Leaving your loved ones specific instructions regarding funeral arrangements can drastically reduce the stress that they’ll obviously be facing should you pass away and spare them the difficulty of making those tough decisions at a painful time. This can be easily complicated when your family and significant other each believe that you wanted something different.
Items to consider are:
- Burial or cremation
- Contact information for a chosen funeral home, cemetery, etc.
- Details about your desired ceremony
- Details about any marker you may want
Drafting an authorization for final disposition provides details to your family and loved ones you may have never discussed with them and gives you a way to have a say in the final details of your life.
6) Revocable or Living Trust
A living trust, which may also just be referred to generally as a revocable trust by your attorney is a tool which can be used by practically anyone to create efficiency and additional protection in an estate plan.
Appropriate beneficiary designations on retirement (and other) accounts.
There are a number of things that a will won’t pass along to beneficiaries, including retirement accounts, insurance policies and other financial instruments that are governed by separate contracts between you and the provider.
In order to ensure that these items go to your spouse if you die, it’s important to name him or her as the beneficiary of the policy.
Married couples also enjoy some additional benefits when it comes to planning for the disposition of retirement accounts, if done correctly. For example, a spouse inheriting an IRA will be able to roll the finds over to his or her IRA if appropriate steps are taken which will permit the surviving spouse to space out distributions over a longer period of time.
If changes are necessary you should make sure to file a new beneficiary designation form with the company.
7) Title to Real Estate
If you and your spouse own real estate together, then you should consider your options when it comes to how real estate titles should be held.
For example, by holding the real estate as joint tenants with right of survivorship you’ll be able to ensure that, should something happen to one of you, the entire interest in the home will pass to the surviving partner.
Married couples in a number of states are also permitted to hold property as tenants by the entirety- a type of ownership only available to married couples. Joint tenancy and tenancy by the entirety create additional rights and protections that may not otherwise be available to property owners.
It’s a great idea to talk to your attorney about what certain types of real property ownership mean to you and your spouse.
8) Life Insurance/ Life Insurance Trusts
Life insurance can provide a windfall for your spouse should you pass away suddenly, so it’s a good idea to look at your options with your insurance agent.
One drawback of life insurance is that its value gets included in your estate for tax purposes upon your death.
With some policies paying out millions of dollars, this can have a significant impact on your surviving spouse, as it may push your estate over the estate tax threshold, thus reducing the award your surviving spouse will receive.
One way to potentially bypass that unwanted possibility is to have your attorney draft an irrevocable life insurance trust to hold the policy. A policy held in an irrevocable life insurance trust does not get included when calculating the total value of your estate for tax purposes upon your death. By naming your spouse as the beneficiary of the policy, you can ensure that the payout will be maximized in the event you pass away.
Are you or an organization you are involved with looking for an event speaker? I'm your guy! I would like to come and talk to your group about estate plans and elder law topics. Give me a call today!
The federal regulation known as the Health Insurance Portability and Accountability Act (HIPAA) was adopted regarding disclosure of individually identifiable health information. This necessitated the addition of a special release and consent authority to all healthcare providers before medical information will be released to agents and interested persons of the patients.
Any old Powers of Attorney, Living Wills, Revocable Living Trusts, and certainly all Medical Directives now require HIPAA amendments. After you sign the Living Will with the HIPAA provisions, you should provide a copy to your doctor and family. Powers of attorneys and Living Wills should be updated to reference this Federal regulation.
A Living Will is your written expression of how you want to be treated in certain medical conditions. Depending on state law, this document may permit you to express whether or not you wish to be given life-sustaining treatments in the event you are terminally ill or injured, to decide in advance whether you wish to be provided nourishment via intravenous devices (sometimes erroneously referred to as "tube feeding"), and to give other medical directions that impact the end of life. "Life-sustaining treatment" means the use of available medical machinery and techniques, such as heart-lung machines, ventilators, and other medical equipment and techniques that will sustain and possibly extend your life, but which will not by themselves cure your condition. In addition to terminal illness or injury situations, most states permit you to express your preferences as to treatment using life-sustaining equipment and/or tube feeding for medical conditions that leave you permanently unconscious and without detectable brain activity.
The below verbiage is an EXAMPLE of clauses that might be included in a living will. They should NOT be used in your documents without discussing with an attorney.
Fluids and Nutrition. I request that artificially provided fluids and nutrition, such as by feeding tube or intravenous infusion (initial one)
1. ______ shall be withheld or withdrawn as "Life Sustaining Treatment."
2. ______ shall be provided to the extent medically appropriate even if other "Life Sustaining Treatment" is withheld or withdrawn.
Directive as to Medical Treatment. I request that "Life Sustaining Treatment" be withheld or withdrawn from me in each of the following circumstances: (Initial all that apply)
1. ______ If the "life sustaining treatment" is experimental and not a proven therapy, or is likely to be ineffective or futile in prolonging my life, or is likely to merely prolong an imminent dying process;
2. ______ If I am permanently unconscious (total and irreversible loss of consciousness and capacity for interaction with the environment);
3. ______ If I am in a terminal condition (terminal stage of an irreversibly fatal illness, disease, or condition); or
4. ______ If I have a serious irreversible illness or condition, and the likely risks and burdens associated with the medical intervention to be withheld or withdrawn outweigh the likely benefits to me from such intervention.
5. ______ None of the above. I direct that all medically appropriate measures be provided to sustain my life, regardless of my physical or mental condition.
Please contact our firm to discuss these important alterations that may be necessary for your existing will or other estate planning documents.
ITS ALMOST TIME!!!
National Healthcare Decisions Day--April 16th!!
National Healthcare Decisions Day (NHDD) is right around the corner! NHDD is an initiative to encourage people to express their wishes regarding healthcare and for providers and facilities to respect those wishes, whatever they may be. It's important to understand that NHDD is not only about end-of-life care but is meant to reach a much broader spectrum of individuals so that every individual may have their healthcare wishes met.
Interested in joining the movement? Visit the NHDD blog page to get inspired, listen to TCP's most recent community call where we discussed how individuals have participated in NHDD in the past and click here to access the NHDD promotional toolkit!
1701--the coworking space in Virginia Beach--is hosting me at a talk on April 10th. More information is available here. FREE LUNCH!
Eight surprising facts about getting old in America By Ashton Applewhite
March 9, 2019 | 9:52am | Updated
If you’d told me 10 years ago that I’d become fascinated with aging, I’d have snorted in disbelief. Why on earth would I, then aged 56, want to spend my time thinking about something so dismal and depressing? That was before I started a project about workers over 80 and learning about longevity. It didn’t take long to realize that almost everything I thought I knew was way off base — or flat-out wrong. Here are some of the numbers I came across:
2.5%: I thought the odds of ending up in some grim institution were pretty good, especially if I lived long enough. In fact, the percentage of Americans over 65 in nursing homes is just 2 and a half percent, and it’s dropping. Even for people 85 and up, the number is only 9 percent.
90%: What about the specter of dementia? Here’s the thing: Alzheimer’s is a terrible disease, but it is not typical of aging. One in 10 people age 65 and older (10 percent) has Alzheimer’s dementia, which means that 90 percent do not. Even as the population ages, dementia rates are falling significantly, according to a 2017 report by the Journal of the American Medical Association, and people are being diagnosed at older and older ages. The real epidemic is anxiety about memory loss.
50%: OK, but what about becoming sick, and helpless? Over half of the “oldest old” — 85 and up — can go about their everyday activities without any help. Probably not shoveling their driveways or doing Costco runs, but dressing, cooking and wiping their own bottoms. The vast majority of older Americans enjoy independent lives, slowed somewhat but fully capable of finding our glasses sooner or later and making our way in the world.
25%: Don’t we age into loneliness and depression? Not usually. Only a quarter of Americans over 70 say they’re lonely (25 percent, compared with 43 percent of people ages 45-49). Younger people worry more than their elders about becoming socially isolated, and for good reason. According to a 2018 survey by global health-service company Cigna, the loneliest group is Generation Z (ages 18-22).
Here’s the kicker: People are happiest at the beginnings and the ends of their lives. It’s called the “U-shaped happiness curve” — go ahead, Google it — and it’s been borne out by many reputable studies in the US and around the world.
$7.4 trillion: Think older people are an economic burden? Think again. Although they make up only 35 percent of the population, people over 50 contribute 43 percent of the total US GDP — a cool $7.4 trillion. Not only can we afford “all these old people,” they’re punching above their weight when it comes to their impact on the economy.
Why do so many of these numbers come as a surprise? Because of ageism: discrimination and stereotyping on the basis of age, especially against older people. The personal, social and economic consequences are devastating.
$64 billion: Ageism in health care adds a staggering $64 billion to the cost of health care in the US every year, a Yale School of Public Health study found in 2018. That’s because battling the negative stereotypes that feed ageism cause stress, which is bad for our health. And that’s just the health-care price tag.
56%: Brand new data shows more than half of older US workers are pushed out of longtime jobs before they choose to retire, suffering financial damage that is often irreversible. The personal effects also devastate.
7.5 years: People with accurate perceptions of aging can expect to live 7 an a half years longer, on average, than people brainwashed by negative myths and stereotypes, according to a 2002 study published by the National Institutes of Health. Not only that, they walk faster, heal quicker and are less likely to develop dementia — even if they’re genetically predisposed towards the disease.
I’ve learned that our fears about aging are way out of whack with reality and that knowing the facts about getting older leads to a happier, healthier approach for society. That’s why I’m on a crusade to make ageism as unacceptable as any form of prejudice. I hope you’ll join me.
Brooklyn-based writer and activist Ashton Applewhite is the author of “This Chair Rocks: A Manifesto Against Ageism” (Celadon Books), out now.
Talked to several doctors and psychologists about this recently. They urged people to get a voluntary baseline scan and evaluation at age 50. Again, this would establish a mental health baseline so that later on down the line the doctors who examine you have something to go off of. Valuable advice.
Every senior needs cognitive screening, Alzheimer's Association says
By Sandee LaMotte, CNN
At first, she just forgot a name or two. Then, a few meetings on her schedule. A few months later, LuPita Gutierrez-Parker found herself struggling at work to use computer software she knew intimately.
"In the beginning, when I wasn't sure what was happening to me, I just figured it must be stress because I was doing a lot of work and had too much on my mind," Gutierrez-Parker said.
Another few months passed, and she found herself re-reading the same passage in documents to comprehend their meaning. When her command of language also began to fail, Gutierrez-Parker, who lives in Yakima, Washington, began to worry.
"Why did I just say that? That's not grammatically correct," she would think. " 'That wasn't me. I have a very strong vocabulary.' I was a very articulate person."
Lupita Guitterez-Parker waited for more than a year to discuss her worries about mental decline with her doctor.
Yet it took her another year or so to bring up the topic with her primary care physician.
The delay in seeking answers to cognitive decline is not surprising, according to a survey included in the Alzheimer's Association's 2019 Alzheimer's Disease Facts and Figures report, released Tuesday.
"We need to increase the confidence and the skills of front-line providers so they can provide more care in this area," said Joanne Pike, chief program officer at the Alzheimer's Association.
"And we need to destigmatize the process for seniors, encouraging people to talk to their health-care providers and families about their concerns," she said.
Gutierrez-Parker's primary care doctor gave her a mini-cognitive assessment, asking her some question verbally and then on paper. It didn't go well.
"I said, 'what did I flunk?' " Gutierrez-Parker remembered. "And we both laughed because she knew I was an educated woman."
A PET scan and neuropsychological evaluation six months later confirmed her worst fears. In 2016, at the relatively young age of 61, Gutierrez-Parker was diagnosed with mild cognitive impairment, an early stage of dementia.
Even though she was devastated, she also "felt reassured knowing that they finally put a label on what was wrong with me" and encourages others who are worried about their mental status to reach out to a doctor for help.A call to action
The Alzheimer's Association couldn't agree more. In its annual report, the association includes a call for action to the nation's primary care physicians. Every senior should receive a brief cognitive assessment at their first Medicare annual wellness visit at age 65, the group says, and the exams should be a regular part of their ongoing annual care.
This is the cognitive test the president passed
Yet a survey by the association found that early cognitive assessments were not the norm during most senior doctor visits.
"The survey found a really troubling underuse of cognitive assessments during the annual healthcare checkup," said Pike. "Despite a strong belief among seniors and physicians that cognitive assessments are important for the early detection of Alzheimer's, only half of the seniors in the survey were being assessed for cognitive decline. And only 16% [of] seniors received regular followup assessments."
A comparison of those statistics against those of other wellness checkup items give a clear picture of the disparity, Pike said. In each visit, physicians check cholesterol 83% of the time, vaccinations 80% and blood pressure 91% of the time, she said.
"So while physicians say it's important to assess all patients age 65 or older, fewer than half are saying that it's part of their standard protocol," she said.
Newly discovered Alzheimer's genes further hope for future treatments
A good bit of that might be due to "a strong disconnect between seniors and doctors as to who should initiate the conversation," Pike said. Over 90% of seniors thought their doctor would recommend testing, so fewer than 1 in 7 brought the topic up on their own, the survey found. Primary care physicians, on the other hand, say they are waiting for senior patients and their families to report symptoms and ask for an assessment.
"We need to increase the confidence and the skills of front-line providers so they can provide more care in this area," Pike said. "And we need to destigmatize the process for seniors, encouraging people to talk to their health-care providers and families about their concerns."
Gutierrez-Parker agrees. She's thankful she has the chance to spend quality time with her family, and volunteer for the Alzheimer's Association to bring awareness to her community.
"I would say to people who have an opportunity to find out what is wrong with them, to do it," she said. "It gives you more opportunities to get your house in order: do advance directives, your will, even your funeral. It's peace of mind, and it takes that load off your family.
"Get it done and then enjoy the rest of your time with your family and loved ones."
Sandy's Story: 7 years after Alzheimer's diagnosis, 'there's still a good life'
Prevalence of Alzheimer's
There's a bit of good news buried in the association's annual report. A flurry of recent studies show that Alzheimer's and other dementias in the United States and other higher-income Western countries is on a decline, mostly due to tighter control of cardiovascular risk factors and improved education. But overall, study results are mixed and inconclusive, according to the report, and certainly will have little effect on the current rise in cases in the United States as the baby boomer population continues to age.
With no significant treatment and no cure in sight, the association's report projects that by 2025, the number of Americans 65 and older with Alzheimer's will "reach 7.1 million -- almost a 27 percent increase from the 5.6 million age 65 and older affected in 2019."
It's the "oldest old," those over 85, who are most at risk for Alzheimer's, the association says. In 2019, there are just over 2 million Americans 85 and older; in 2031, when the first wave of baby boomers hits that age, the number will rise to 3 million. By midcentury, there will be 7 million of the "oldest old" in the United States, accounting for half of all people over 65 with Alzheimer's.
The cost to society will be substantial, the report says. In 2019 alone, it estimates a $290 billion burden from health care, long-term case and hospice combined. Medicare and Medicaid will cover $195 billion of that, with out-of-pocket costs to caregivers reaching $63 billion.
I'm glad to see the FBI is getting serious. Now, like I talked about in my blog last week--YOU NEED TO PAY ATTENTION and help your elderly relatives not fall victim to these scams. PLEASE. PAY. ATTENTION. If you see something suspicious or off, talk to your elderly relative/friend. If you are not satisfied with their answers, get them some law enforcement assistance ASAP.
$356,000 to protect your computer? Feds promise 'all-out attack' on scams targeting the elderly
Kevin Johnson, USA TODAY Published 12:05 p.m. ET March 7, 2019 | Updated 4:16 p.m. ET March 7, 2019
WASHINGTON – One man, alarmed at the thought that hackers might attack his computer, shelled out $14,990 to a company promising a "fix" that would keep it safe.
Eight months later, the 68-year-old from Hawaii mailed the same company a check for $24,999 more. And he kept paying. All told, the unnamed man, who suffers from dementia, sent about $356,000 in checks and wire transfers, unaware that the computer security alert was part of a network of elaborate scams that the government says cost the nation’s elderly and infirm hundreds of millions of dollars over the past year alone.
The case is part of a heartbreaking archive of court documents filed in just the past year, charging more than 200 suspects with trying to swindle 2 million Americans, most of them elderly.
Federal authorities said the illicit operations, some based in the United States and others scattered across the globe, looted seniors of nearly $1 billion. The charges brought in the past 12 months, the second such enforcement campaign in as many years, represents the largest of the federal sweeps against elder fraud.
“Crimes against the elderly target some of the most vulnerable people in our society,” Attorney General William Barr said Thursday. He said the Justice Department will intensify its efforts to target those cams, promising to mount an “all-out attack.”
Tech Support Scams: Beware of tech-support scams
Be Careful: Seniors face slew of online, phone scams. Here's how to avoid the top ones.
The broad enforcement effort, involving the FBI, Postal Inspection Service, Secret Service and the Department of Homeland Security, identified suspects in Canada, The Cayman Islands, Costa Rica, Jamaica and Poland. The far-flung networks involved groups of varying sizes, from small boiler-room operations to organizations involving as many as 500 people who worked day and night shifts calling potential targets throughout the United States, authorities said.
New attention was brought to the problem earlier this year when former FBI and CIA Director William Webster acknowledged that he had been targeted in a lottery scam.
Webster, 95, went straight to the FBI after he was directed to pay thousands of dollars to cover taxes on the phony multimillion-dollar prize.
This year, a Jamaican man was sentenced in the case to nearly six years in prison.
The most prolific of the recent schemes, however, have involved phony computer security alerts, which prompted a costly response by the elderly Hawaii victim, who was identified in court documents by the initials, “S.K.”
Typically, suspects trick victims into providing remote access to their computers, believing that the so-called “technical support” will plug gaps in security. Last year, the Federal Trade Commission received more than 142,000 complaints involving the computer scams.
In another case involving a California man, a telemarketer directed the 74-year-old retiree to make a series of payments to install “updated security software” to guard against hacks.
During a two-year period, the victim made payments totaling more than $500,000, some of it routed to a bank in New Delhi.
Trump Treasury Backtracks On Lump-Sum Pension Rules Meant To Protect Retirees
The Treasury Department told employers back in 2015: Lump-sum pension buyouts for retirees already in payout status are a no-no. In practice, employers stopped offering them, per Notice 2015-49, despite the fact that proposed and temporary rules never came out.
Jeff Sodoma, MPA, Esq. is a lawyer based in Virginia Beach, Virginia
Hello, there! Welcome to my blog. I will use this blog as a platform for my writing. I will write about topics in the legal world, certainly, as well as everything else under the sun, because I have many interests (and viewpoints). All views expressed in this blog, unless otherwise noted, are mine alone. One of my interests is music--my wife believes that I should go on "Beat Shazam" because I know so many songs--and I will be, from time to time, analyzing song lyrics and how they relate to the legal world.