Power of Attorney

In planning your estate, you most likely have concerned yourself with “big picture” issues. Who inherits what? Do I need a living trust? However, there are numerous details that are often overlooked, and which can drastically impact the distribution of your estate to your intended beneficiaries. Listed below are some of the most common overlooked estate planning issues.

Liquid Cash: Is there enough available cash to cover the estate’s operating expenses until it is settled? The estate may have to pay attorneys’ fees, court costs, probate expenses, debts of the decedent, or living expenses for a surviving spouse or other dependents. Your estate plan should estimate the cash needs and ensure there are adequate cash resources to cover these expenses.

Tax Planning: Even if your estate is exempt from federal estate tax, there are other possible taxes that should be anticipated by your estate plan. There may be estate or death taxes at the state level. The estate may have to pay income taxes on investment income earned before the estate is settled. Income taxes can be paid out of the liquid assets held in the estate. Death taxes may be paid by the estate from the amount inherited by each beneficiary. 

Executor’s Access to Documents: The executor or estate administrator must be able to access the decedent’s important papers in order to locate assets and close up the decedent’s affairs. Also, creditors must be identified and paid before an estate can be settled. It is important to leave a notebook or other instructions listing significant assets, where they are located, identifying information such as serial numbers, account numbers or passwords. If the executor is not left with this information, it may require unnecessary expenditures of time and money to locate all of the assets. This notebook should also include a comprehensive list of creditors, to help the executor verify or refute any creditor claims.

Beneficiary Designations: Many assets can be transferred outside of a will or trust, by simply designating a beneficiary to receive the asset upon your death. Life insurance policies, annuities, retirement accounts, and motor vehicles are some of the assets that can be transferred directly to a beneficiary. To make these arrangements, submit a beneficiary designation form to the financial institution, retirement plan or motor vehicle department. Be sure to keep the beneficiary designations current, and provide instructions to the executor listing which assets are to be transferred in this manner.

Fund the Living Trust: Unfortunately, many people establish living trusts, but fail to fully implement them, thereby reducing or eliminating the trust’s potential benefits. To be subject to the trust, as opposed to the probate court, an asset’s ownership must be legally transferred into the trust. If legal title to homes, vehicles or financial accounts is not transferred into the trust, the trust is of no effect and the assets must be probated.

Preparing for the future is an uncertain business, but there are steps you can take during your lifetime to simplify matters for your loved ones after you pass, and to ensure your final wishes are carried out. Planning for what happens to your property, or who cares for your family members, upon your death can be a complicated process. To simplify things, we’ve created the following list to help you avoid some of the pitfalls you may encounter before, or even long after, you create your estate plan.

Don’t assume you can plan your estate by yourself. Get help from an estate planning attorney whose training and experience can ensure that you minimize tax implications and simplify the process of settling your estate.

Don’t put off your estate planning needs because of finances. To be sure, there are upfront costs for establishing the estate plan; however establishing your estate plan is an investment in the future well-being of your family, and one which will result in a far greater cash savings over the long term.

Don’t make changes to your estate plan without consulting your attorney. Changes in one area of your estate plan could impact other provisions you have made, triggering legal or tax implications you never intended.

Don’t assume your children will intuitively know your wishes, and handle the situation appropriately upon your death. Money and sentimental items can cause a rift between even the most agreeable siblings, and they will be especially vulnerable as they deal with the emotional impact of your passing.

Don’t assume that once you’ve prepared your estate plan it’s set in stone. Estate planning documents regularly need to be revised, often due to a change in marital status, birth or death of a family member, or a significant change in the value of your estate. Beneficiary designations should be periodically reviewed to ensure they are up to date.

Don’t forget to notify your family members, friends or other beneficiaries of your estate plan. Make sure your executor and successor trustee have access to your end-of-life documents.

Don’t assume your spouse will handle everything if something happens to you. It’s possible your spouse may be incapacitated at the same time, for example if you both are injured in the same accident. A proper estate plan appoints alternate representatives to handle your affairs if both you and your spouse are unable to do so.

Don’t use the same person as your agent under both the financial and healthcare powers of attorney. Using the same individual gives that person an incredible amount of influence over your future and it may be a good idea to split up the decision-making authority.

Don’t forget to name alternate agents, executors or successor trustees. You may name a family member to fill one of these roles, and forget to revise the document if that person dies or becomes incapacitated. By adding alternates, you ensure there is no question regarding who has the authority to act on your or the estate’s behalf.

Many people purchase a life insurance policy as a way to ensure that their dependents are protected upon their passing. Generally speaking, there are two basic types of life insurance policies: term life and whole life insurance. With a term policy, the holder pays a monthly, or yearly, premium for the policy which will pay out a death benefit to the beneficiaries upon the holder’s death so long as the policy was in effect. A whole life policy is similar to a term, but also has an investment component which builds cash value over time. This cash value can benefit either the policy holder during his or her lifetime or the beneficiaries.

During the Medicaid planning process, many people are surprised to learn that the cash value of life insurance is a countable asset. In most cases, if you have a policy with a cash value, you are able to go to the insurance company and request to withdraw that cash value. Thus, for Medicaid purposes, that cash value will be treated just like a bank account in your name. There may be certain exceptions under your state law where Medicaid will not count the cash value. For example, if the face value (which is normally the death benefit) of the policy is a fairly small amount (such as $10,000 or less) and if your "estate" is named as a beneficiary, or if a "funeral home" is named as a beneficiary, the cash value may not be counted. However, if your estate is the beneficiary then Medicaid likely would have the ability to collect the death proceeds from your estate to reimburse Medicaid for the amounts they have paid out on your behalf while you are living (this is known as estate recovery). Generally, the face value ($10,000 in the example) is an aggregate amount of all life insurance policies you have. It is not a per policy amount.

Each state has different Medicaid laws so it’s absolutely essential that you seek out a good elder law or Medicaid planning attorney in determining whether your life insurance policy is a countable asset.

Jacque Wilson (CNN.com) has recently published an article entitled, “Dying: What no one wants to talk about” (January 12, 2014). Provided below is the abstract to the article from CNN.com:

Dying: What no one wants to talk about

No one likes to think about death; it is a situation that no one wants to be in. Looking at a loved on a hospital bed as the doctors talk about ventilators, feeding tubes, EEG results, etc. and wondering if this is what your loved one would have wanted is a horrible situation to be in. What would you do in a similar situation?

13-year-old Jahi McMath has made many people question what they would do in a situation like this. Doctors declared her brain dead after a tonsillectomy in early December. Although a judge agreed that she was brain dead, her family fought to keep Jahi alive. Do you think this is what Jahi would have wanted? Her family does not know the answer to that question.

A California study found that 84% of those who were surveyed said their loved ones had no idea or knew what their wishes were exactly and only 29% had ever had a serious conversation about end of life care. No matter what your age is right now you do not know what can happen to you and therefore talking to loved ones about end of life care should be an important conversation to have sooner than latter.

Find out the five things you need to do now by continuing to read more about this article “Dying: What no one wants to talk about” by Jacque Wilson.

For Week 3 of the National Alzheimer's Awareness Month, LegalJourney will be offering a free Power of Attorney and Declaration of Preened Guardian¹ from Wednesday November 20th until Friday November 22nd, 2013. 

Week 3: Free Power of Attorney and Declaration of Preneed Guardian¹

The first 4 individuals who contact the LegalJourney Law Firm using the "Contact the Firm" option on www.legaljourney.com will receive a free Florida Power of Attorney and a free Florida Declaration of Preneed Guardian.

The LegalJourney Law Firm’s Week 3 offer includes: an interview with an attorney, a customized power of attorney, a customized declaration of preneed guardian and notarization² of your documents.

To find out additional details, please contact the LegalJourney Law Firm PLLC

¹This offer is available until close of business November 22, 2013.

²Notarization is only available to residents of the Tampa Bay Area

In general, wills or living trusts that are valid in one state should be valid in all states. However, if you’ve recently moved, it’s highly recommended that you consult an estate planning attorney in your new state. This is because states can have very different laws regarding all aspects of estate planning. For example, some states may allow you to disinherit a spouse if certain language is used, while other states may not allow it.

Another event that can cause problems with moving and estate planning is moving from a community property state to a common law state or vice versa. In community property states, all property earned or acquired during marriage is generally owned in equal halves by each spouse, with some exceptions, such as any property received by only one of them through gift or inheritance. The property that is considered community property includes income, anything acquired with income during the marriage, and any separate property that is transformed into community property. Separate property includes anything owned by either spouse before marriage, property received by only one spouse by gift or inheritance, and any property earned by one spouse after permanent separation. One spouse is not required in community property states to leave his or her half of the community property to another spouse, although many do.

In common law states, property acquired during a marriage is not automatically owned by both spouses. In common law states, the spouse who earns money and acquires property owns it by himself or herself, unless he or she chooses to share it with his or her spouse. Common law states usually have rules to protect a surviving spouse from being disinherited.

Whether a couple lives in a community property state or a common law state is important for estate planning purposes, because that can directly affect what each spouse is considered to own at death.

If a couple moves from a common law state to a community property state, there are different rules about what happens depending on where you move. If you move from a common law state to California, Washington, Idaho or Wisconsin, the property you bring into the state becomes community property. If you move to another community property state (Alaska, Arizona, New Mexico, Nevada, or Texas), your property ownership won’t automatically change. If a couple moves from a community property state to a common law state, each spouse retains a one-half interest in property accumulated during marriage while they lived in the community property state.

As you can see, the laws of different states vary significantly with respect to incapacity planning, estate planning and inheritance rights. Therefore, it’s important to contact an estate planning attorney in your new area, especially if you are moving from a community property state to a common law state, or vice versa.

To raise awareness for Alzheimer’s disease, Attorney Karnardo Garnett will be participating in the National Alzheimer’s Awareness month by offering a free service each week starting Wednesdays and ending Fridays.

This week LegalJourney will be offering a free Online Power of Attorney¹from Wednesday November 7^th until Friday November 9^th, 2013.

Week 1: Free Online Power of Attorney¹

The LegalJourney Law Firm will provide a free “Online Power of Attorney,” each day¹, for the first 3 individuals who sign up for a new online client account via the online legal services link on www.legaljourney.com.

To set up a free online account:

1.     Go to www.legaljourney.com;

2.     Select “Click Here For Online Legal Services”;

3.     Select “Register for a New Online Legal Services Account today!"

Create a user account and you will be notified within 24 hours if you will be a recipient of todays offer.

Florida Statute Section 709.2101 through 709.2402 (effective date October 1, 2011): Although still effective, everyone with a Power of Attorney (POA) created prior to October 1, 2011 should discuss his or her options with a knowledgeable estate-planning attorney. Issues have arisen in the past with financial institutions not accepting POAs or requiring their specific form to be signed. However, for POAs created under the new Statute, per section 709.2120, F.S., a third person is required to accept or reject a POA within a reasonable time and is not allowed to require an additional or a different POA for authority granted in the present POA. If the third person rejects a POA under the new Statute, they could be held liable for damages and attorney fees.

¹This offer is available until November 9^th, 2013.

As part of National Alzheimer’s Awareness Month, the LegalJourney Law Firm will be spreading the word on free services offered during the month of November 2013. 

The Byrd Institute is offering the following services:

Free Memory Screening - TUESDAY, NOVEMBER 19, 2013 8:30AM - 3:30PM

The USF Health Byrd Alzheimer’s Institute will offer free memory screenings on Tuesday, November 19th from 8:30am-3:30pm. In addition to memory screenings, guests will enjoy exhibit booths, blood pressure checks, and hearing screenings. Bring your prescription and over-the-counter medications for a consultation with a clinical pharmacist.

*Reservations required. To make an appointment, please call: (813) 974-4357

Free Tremor Screenings - TUESDAY, NOVEMBER 19, 2013 10:00AM - 12:30PM the USF Health Parkinson’s Disease and Movement Disorders Center (6th floor of Byrd Alzheimer’s Institute).

 *Reservations required. To make an appointment, please call: (813) 396-0751

The Byrd Institute is located at 4001 E. Fletcher Ave, Tampa, FL

Day 5: Free Online Will Based Estate Plan Package¹

The LegalJourney Law Firm is providing a free “Online Will Based Estate Plan Package” for the first 2 individuals who sign up for a new client account via the online legal services link at www.legaljourney.com. 

To set up a free online account:

1.     Go to www.legaljourney.com;

2.     Select “Click Here For Online Legal Services”;

3.     Select “Register for a New Online Legal Services Account today!"

Create a user account and you will be notified within 24 hours if you will be a recipient of todays offer.

The LegalJourney Law Firm’s Online Will based Estate Plan Package includes: a Will, a Living Will, Health Care Power of Attorney, HIPPA Authorization and Durable Power of Attorney.

To find out additional details, please contact the LegalJourney Law Firm PLLC

¹This offer is available until close of business October 21, 2013.

Day 4: Free Power of Attorney and Declaration of Preneed Guardian¹

The first 4 individuals who contact the LegalJourney Law Firm using the "Contact the Firm" option on www.legaljourney.com will receive a free Florida Power of Attorney and a free Florida Declaration of Preneed Guardian.

The LegalJourney Law Firm’s Day 4 offer includes: an interview with an attorney, a customized power of attorney, a customized declaration of preneed guardian and notarization² of your documents.

To find out additional details, please contact the LegalJourney Law Firm PLLC

¹This offer is available until close of business October 18, 2013.

²Notarization is only available to residents of the Tampa Bay Area

Day 3: Free Online Trust Based Estate Plan Package¹

The LegalJourney Law Firm is providing a free “Online Trust Based Estate Plan Package” for the first 2 individuals who sign up for a new client account via the online legal services link at www.legaljourney.com. 

To set up a free online account:

1.     Go to www.legaljourney.com;

2.     Select “Click Here For Online Legal Services”;

3.     Select “Register for a New Online Legal Services Account today!"

Create a user account and you will be notified within 24 hours if you will be a recipient of todays offer.

The LegalJourney Law Firm’s Online Will based Estate Plan Package includes: a Will, a Living Will, Health Care Power of Attorney, HIPPA Authorization and Durable Power of Attorney.

To find out additional details, please contact the LegalJourney Law Firm PLLC

¹This offer is available until close of business October 17th, 2013