As of May 1, 2020, the Law Offices of Cynthia M. Clark is changing its name to Manasota Elder Law. Since it is the 21st century, in addition to written blog articles, we’ll also be posting (very!) informal vlogs – video blogs. At some point, we plan to get a bit better microphone and camera, and have each video transcribed for those who prefer reading. But you have to start somewhere. 🙂
Here’s a brief welcome and the first vlog. We hope you enjoy them, and if you do, please “Like,” share, and Subscribe to the Manasota Elder Law YouTube channel!
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Some of the most valuable gifts you can leave your loved ones are information and a plan.
Spend the energy, effort, and time now to consider your wishes, collect information and, most importantly, get everything down on paper, says In Maricopa’s recent article entitled “Make an end-of-life checklist.”
A list of all your assets and critical personal information is a guarantee that nothing is forgotten, missed, or lost. An estate planning attorney can assist you and guide you through the process.
Admittedly, it’s an unpleasant subject and a topic most people don’t want to discuss, but an end-of-life checklist can be a welcome final gift to your family and loved ones.
When you work with an experienced estate planning attorney, you can generally add some specific instructions to your Will or other estate planning documentation. Make certain that you appoint an executor/personal representative that you trust and will carry out your wishes.
Have ready for your attorney all of your vital, personal information. This should include your name, birthdate, and Social Security number, as well as the location of key documents and items, such as birth certificate, marriage license, military discharge paperwork (if applicable), and your Will, powers of attorney, medical directives, ID cards, medical insurance cards, and details about your burial plot.
In addition, you need to let your family know about the sources of your income. This type of information should include specifics about pensions, retirement accounts, 401(k), or your 403(b) plan. Be sure to include the company name and contact information, as well as the account number, date of payment, document location, and when/how received.
Your end-of-life checklist should also include all medicines and medical equipment used, and the location of these items.
And then double check the locations of the following items: bank documents, titles and deeds, credit cards, tax returns, trust and power of attorney, mortgage and loan documents, personal documents, and insurance policies – life, health, auto, home, etc. It’s wise to add account numbers and contact information.
You may also want to consider creating a list of online usernames and passwords, in printed form, for your family or loved ones to use to access and monitor accounts.
Be sure to keep your End-of-Life Checklist in a secure place, such as an in-home safe, because it has sensitive and private information. And don’t forget to tell your executor/personal representative where it’s located.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Tired of watching TV due to COVID-19 “stay-at-home” orders? You could do something productive, such as reviewing your estate plan. 🙂
Many of you reading this are sitting at home with time on your hands. You can only watch so much Netflix, so perhaps now is a good time to dig your estate planning documents out of the drawer or safe and read them.
As this recent article points out, estate plans – like any other plan – should be reviewed periodically. Will your documents do what you think they’re supposed to do? Are they just a bunch of random documents or part of an overall plan? Are the right people in the right roles?
Are you and everyone involved in your plan in the same exact family, financial, and health situations you all were when your plan was created? Are you in the same state? Your estate plan should comply with your state of residence’s laws, not another state’s laws.
As I tell my clients, an estate plan is not a bucket list item – you can’t just create a plan and then cross it off the list. It’s a process that will provide what’s needed to guide your loved ones when you’re no longer able to help them.
So, take a good look at your current estate plan and its associated documents now. If anything needs work, contact a local estate planning or elder law attorney. Most of us can meet with you virtually via phone or Zoom video conferencing and make safe arrangements for executing documents. This is one thing that doesn’t need to wait until the world returns to normal.
And then review them every 3-5 years, or when you or your family members experience major life events. Remember, you’re not doing this for you…you’re doing it for them.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Public obituaries are nice, but the private obituary you leave your family can be priceless.
An obituary can be much more than just a dry announcement of the time and location of your funeral or memorial service. It can be a way to share your life story, and communicate information about significant events and people, as well as important values you would like to impart to others. You don’t need to leave this task to grieving family members after you pass away; instead, writing your own obituary can be an important part of your estate plan that you can do today.
Estate Planning Isn’t Just about Money and Property
When estate planning is mentioned, it’s not unusual for a Will or a trust to come to mind first. Wills and trusts are among the most common estate planning tools for transferring your belongings and money to your loved ones. But money and property are not the only forms of wealth you’ve accumulated over your lifetime. You have many stories, lessons, experiences, and values to share. You may also want to acknowledge influential family members and other people who’ve played an important part in your life. Your obituary is also a great opportunity for you to ensure that you are remembered in the way you wish.
What Should You Include in Your Obituary?
Because your obituary is all about you, you can emphasize any aspects of your life you wish. There’s no correct format, so you’re free to tell your story in the way you feel most comfortable, showcasing your personality. Here are a few ideas to get your creative juices flowing:
Important life events: If you’d like an opportunity to tell a brief story of your life, your obituary can provide an opportunity for you to highlight the most impactful experiences from your youth into adulthood.
Lessons learned: Most people learn many lessons over the course of their lives, and it’s likely that friends and family members can benefit from your experiences. You can include these lessons in your obituary if you choose so they’ll also be available to a wider audience.
Gratitude: You can use your obituary to express gratitude to the people who’ve played an important and beneficial role in your life. If you’re dealing with a long-term or chronic illness, you may wish to thank healthcare providers or caregivers who have gone above and beyond to help you during a difficult time.
History: Times are changing rapidly. You can tell your friends and family about the different periods in history in which you lived and how they impacted you. If you lived through a war or were involved in or witnessed certain historical events, your loved ones will cherish your memories of those times because they are part of what molded you as a person. Writing down your memories will also leave an important historical record for the next generation.
Goodbyes: Your obituary can be a wonderful way for you to say goodbye to friends and family members who may not live near you and are unlikely to be present when you pass away. As sad as it seems, it’s invaluable for those who are important to you to know that you have thought of them and have made an effort to express your affection.
Where Should You Store Your Obituary?
If it’s important to you for loved ones to publish the obituary you’ve prepared, you need to take steps to ensure that it’s preserved and stored properly. The obituary you’ve written can simply be incorporated as part of your Remembrance and Services Memorandum. A Remembrance and Services Memorandum is an important estate planning document designed to provide guidance to your family members, trustee, and personal representative about who to notify when you pass away, how your remains should be handled, your wishes for your memorial service or funeral, as well as the information that should be included in your obituary—or the obituary itself. You should store the original version of the Remembrance and Services Memorandum containing your obituary in the same safe location as your other estate planning documents, i.e. a fireproof safe. Be sure to let your family, personal representative, and trustee know where your documents are stored, and keep a copy for yourself.
We Can Help
Writing your own obituary in advance can provide you with the peace of mind that comes with knowing you’ll be remembered in the way you wish. It also enables you to provide your family, friends, and acquaintances with a final message of love. In addition, it will relieve your family members of this task during an emotionally difficult time.
Please give us a call to set up a meeting so we can help you create a Remembrance and Services Memorandum that includes your obituary, as well as the other important estate planning documents you need, so you can rest assured that your family members and loved ones will receive all the emotional, spiritual, and monetary gifts you intend.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Don’t let your college-aged kids leave home without their important legal documents.
If you have children or grandchildren in college or heading to college in the fall, there’s one more thing they need before they leave for school – estate planning documents.
As this recent article states, at their age, a Will is far less important than the disability documents: a Durable Power of Attorney, Health Care Proxy, and Living Will. College-aged kids generally don’t have much valuable “stuff”, and under Florida law, the parents are entitled to their kids’ “stuff” even without a Will. But things aren’t as easy when it comes to taking care of your legal-aged child’s financial, legal, and health care issues.
What happens if your 18- or 19-year old child becomes ill or is injured in an accident and can no longer make decisions or communicate with medical professionals? He’s not your baby anymore, and the doctors and hospitals can refuse to allow you to make medical decisions for him or see his medical records – especially if you’re divorced from the other parent. No hospital wants to get in the middle of a potential legal battle. So, if your child didn’t previously execute a Health Care Proxy and Living Will, your only option is guardianship court. Guardianship is a legal process, so it’s costly and stressful – at a time where a parent is already under stress.
A Health Care Proxy (in Florida, we call it a Designation of Health Care Surrogate) allows your child to appoint the people he wants making health care decisions for him when he can’t. And a Living Will is his declaration that he wishes to die a natural death when there’s no reasonable medical probability of recovery – and not be hooked up to machines. Remember the Terri Schiavo case? She was only 26 when she suffered a heart attack in her St. Petersburg, Florida apartment that essentially ended her life. But her body was kept alive by machines for 15 years because her husband and her parents didn’t know what her wishes were.
What if the accident that injured your child was caused by a drunk driver? Without a valid Durable Power of Attorney, a parent will once again be forced to go to guardianship court to be declared the child’s legal guardian, and obtain government permission to sue the drunk driver on behalf of the child. Without a Power of Attorney, the parent also couldn’t access the child’s bank accounts, file his tax returns, talk to the school about his financial aid or grades, talk to the lender on his car loan, and the list goes on.
Your child is naturally focused on the excitement of classes, new friends, and parties – not illness, disability, or death. But, as parents, we know that unforeseen illnesses and accidents can happen to anyone. Make sure your child sees an estate planning attorney and executes these important legal documents so guardianship proceedings can be avoided and loved ones can easily step in when there’s an emergency.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Have you heard these myths about what happens to your estate when you die in Florida?
There are many misconceptions about the law in general and about estate planning in particular. There are also many opportunities to use the law to protect those we love when it comes to helping families navigate life and the legal processes that happen after the death or disability of a loved one. The best option is to plan ahead, reports the article “I’m dead, now what? Myths about deaths in Georgia” from the Cherokee Tribune & Ledger-News. While the article addresses Georgia law, here are the top four myths about what happens when someone dies in Florida (other states may have different laws):
Myth 1.Even if I have no Will, my spouse gets everything. Maybe, maybe not. While you may want your spouse to get everything, if there’s no Will, then Florida’s laws will determine who gets what. Under Florida law, if neither you nor your spouse have any children from previous relationships, then, yes, your spouse will inherit everything. But if either of you have other children outside the marriage, then your children will inherit half of your estate and your spouse will inherit half of your estate. That might not be what you were expecting.
Having a Will allows you to choose who inherits what.
Myth 2: A Will means there’s no need for probate court. Wrong! Having a Will doesn’t mean you avoid probate court and the legal process known as probate. A Will isn’t legally effective until the nominated executor/personal representative presents your Will to the probate court and the court accepts the Will and declares it to be valid. The probate process can be costly and last nine months or longer in Florida. Going through the probate process does have other some downsides if there’s a disgruntled family member or a need for privacy: The probate process creates a public record and information can and often is obtained by family members. To avoid making your life public, you may want to consider an estate plan that includes trusts, which don’t go through the probate process and don’t become public records.
Myth 3: If I don’t have a Will, the state will take it all. It’s very rare that any state will take everything, even if there’s no Will. Florida only does that if absolutely no family members can be found, or if the person who died received Medicaid benefits while alive and left no spouse. More likely? A distant family member will be entitled to inherit. Again, the law varies by state, so check with an experienced estate planning lawyer in your state.
Myth 4: The family gets stuck with the debts. Sort of. The deceased person’s debts don’t have to be paid by a family member if they were not a joint borrower or otherwise legally obligated to pay the debt. However, the debts are paid by the deceased’s estate before anything can be distributed to the beneficiaries. Therefore, the family members will inherit less, but it’s not coming directly out of their own pockets. The debts of the deceased are to be paid by whatever assets he or she owned at the time of death. If there’s not enough in the estate, the family is not obligated to pay the debt.
What you think you know about estate planning can hurt you and your family. An easy way to prevent this is to meet with an experienced estate planning attorney and make a plan that will distribute your assets according to your wishes.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
The money you received from that personal services contract you signed has to be reported to the IRS.
Personal services contracts are very popular in long-term care planning – especially when Medicaid benefits are sought. But they may not be the best solution.
Long-term care in a nursing home (also called a rehabilitation center) is expensive. Many people who are receiving or will be receiving long-term care have little in savings and face impending impoverishment. Medicaid rules allow certain planning measures that may preserve some of the applicant’s assets for his or her family.
One of these measures is known as a personal service or lifetime care contract. This legal contract specifies the compensation a family member will receive in return for providing lifetime personal care and oversight of professional care for the nursing home resident. The Medicaid rules and the family situation will dictate how much compensation can be paid.
In most states, the caretaker is paid in installments as the care is provided. But, in Florida, the caretaker can receive the compensation as a lump sum payment. The caretaker receives the compensation up front, but is legally obligated to provide care for as long as the nursing home resident is alive.
This lump sum payment is considered compensation by the IRS and is taxable income to the caretaker when received.
I’m going to repeat that because it’s so important:
This lump sum payment is considered compensation by the IRS and is taxable income to the caretaker when received.
The Internal Revenue Code § 61 defines gross income as “…all income from whatever source derived, including (but not limited to) the following items: (1)Compensation for services, including fees, commissions, fringe benefits, and similar items…”
Some people think that just because they don’t receive a 1099 or W-2 for certain income, they don’t have to report it on their tax return. Wrong! Just because the IRS may not be notified of the payment doesn’t mean it doesn’t have to be reported. All income – even illegal income – must be reported or you’re committing tax fraud.
If you’ll be receiving compensation due to a personal service contract, be sure to talk to your tax professional before signing the contract because the tax consequences of receiving a lump sum payment may be more detrimental to you than it is beneficial to the potential Medicaid applicant. An Elder Law attorney may be able to provide your family with other alternatives.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Whether you die with a Will, a trust, or neither, some sort of estate administration is almost always needed.
Everyone dies with one of three estate plans. Some die with a Last Will and Testament (Will), others die with a fully funded revocable living trust (RLT), while still others die with neither a Will nor a RLT. The purpose of this brief article is to introduce each of these three estate planning approaches – not to serve as an in-depth treatise on the benefits and drawbacks of each.
Will-Based Planning
When a loved one dies, you need to go through his or her papers as soon as possible to look for a Will. Why? This traditional estate planning legal document often contains critical instructions regarding any “final wishes” of the decedent. For example, some people include funeral and burial instructions in their Wills. Time is of the essence when it comes to those decisions.
Assuming that you’ve found the Will, the first thing you should do is read it and determine who is appointed as its executor/personal representative. If you are the executor, you need to know who the beneficiaries of the Will are, what they are to receive, and when. You also need to determine whether the Will identifies anyone else as a co-executor. For example, a parent might name her two adult children as co-executors of her Will. All co-executors must be involved in the probate process unless they formally decline the appointment. Read the Will to see if it creates any “testamentary trusts” to administer the inheritance. Parents often provide that the inheritance of a minor child shall be held in trust and distributed according to its terms, instead of being distributed outright in a lump sum.
Without delay, contact the attorney who prepared the Will. That attorney is likely the person who knows the “testamentary intent” of the decedent, along with the nature and location of all estate assets.
Proving the Will
The first responsibility of the probate court is to “prove” the Will. In other words, is the Will presented truly the “Last Will” and not the “second to the last Will”? If the judge determines that the Will presented is the “Last Will” and is otherwise legal in all technical respects, the judge will issue “letters testamentary” or “letters of administration,” giving you legal authority to act as executor on behalf of the estate. You can use this key document when dealing with the decedent’s banks, brokerage firms and insurance companies, and fulfilling the many responsibilities that come with being the executor of the estate.
Probate Administration
With a valid Will and letters of administration in hand, the duties of the executor regarding probate administration may vary from state to state, but generally the executor follows these fundamental steps:
Collects, protects, values and insures (if needed) the assets of the estate,
Files an inventory with the court listing the assets subject to probate,
Provides actual notice to known creditors and notice by publication to potential creditors,
Pays the final expenses, taxes and legitimate debts of the decedent,
Files appropriate state and federal tax returns for the decedent and the estate,
Distributes the assets according to the Will (with the approval of the judge, if needed),
Follows any additional specific instructions under the Will (with the approval of the judge, if needed), and
Closes the estate and receives formal discharge by the probate judge.
Note: the executor is often appointed to serve as the trustee for any “testamentary trusts” created over the inheritance. While your services as executor may end with the closing of probate, it may only be beginning, if appointed as trustee.
Revocable Trust-based Planning
If the decedent left a trust agreement, the estate will be distributed according to the terms of the trust document, with little if any involvement by the probate court. In many states, the trust agreement itself is not filed with the court unless there’s a contest or dispute. As a result, there’s no need for the court to declare whether the trust agreement is valid and appoint a trustee. This lack of probate is one of the chief advantages of a RLT-based estate plan. However, probate would still be necessary to approve of any guardian nominated to serve as the backup parent for an orphaned minor child.
In contrast to probate administration under the supervision of an impartial judge, the trustee is responsible for the complete stewardship over the trust assets and fulfilling its terms. This responsibility includes paying final expenses, taxes and legitimate debts of the decedent, managing assets, paying the debts and expenses, filing the tax returns and distributing the trust assets according to the terms of the trust agreement. As with a “testamentary trust” created under a Will, these distributions may be made in an immediate lump sum, staggered over years, or continue over multiple generations.
No Will or Trust
Every state has “intestate succession” laws governing what happens when a person dies without a valid Will or RLT. As described above, it’s even possible to have a Will declared invalid, resulting in the estate going through intestacy. One of the greatest drawbacks to “dying intestate” is the complete lack of input that the decedent has when it comes to who serves as executor and how the inheritance is distributed. For example, in many states, if the decedent was married and had minor children, then the surviving spouse doesn’t inherit the entire estate. The surviving spouse may be responsible for managing the share allotted to the children until each child reaches age 18. Upon reaching that age, the inheritance for each child must be paid over in one lump sum, even if the child has special needs or suffers from addictions.
Your life, loved ones, and estate are all unique. In turn, your estate planning should reflect your goals to protect everyone you love and everything you have.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
The CARES Act of 2020 will affect nearly everyone’s retirement and estate planning.
The CARES (Coronavirus Aid, Relief, and Economic Security) Act of 2020 was signed into law by the President on March 27th. Several provisions of the legislation impact IRA and employer-retirement plans.
This is just a high-level overview of just a few of these provisions; be sure to contact your financial advisor to see if changes need to be made to your retirement-plan strategy.
If you were expecting to take Required Minimum Distributions (RMDs) from IRAs or employer retirement plans in 2020, this year’s RMDs are now waived. This is a permanent waiver, not just a deferral. This waiver also applies to beneficiaries of inherited IRAs, Roth IRAs, and employer retirement plans.
Any remaining 2019 RMDs having a required beginning date of April 1, 2020 and not withdrawn by January 1, 2020 are also waived.
Already take a RMD you don’t need? You may be able to reverse it through what is known as an indirect rollover. Distributions taken from an IRA can be returned to the same IRA if 1) the money is returned within 60 days and 2) there must not have been an IRA-to-IRA or Roth IRA-to-Roth IRA transfer within the 12 months preceding the distribution. However, beneficiaries are not able to reverse an RMD from an inherited IRA or employer retirement plan.
If you need to withdraw money from your IRA and you’re under 59 1/2, Coronavirus-related distributions (CRDs) up to $100,000 from IRA or employer plans will be exempt from the 10% early withdrawal penalty that would normally apply. Individuals who meet the requirements for being affected by the coronavirus are eligible.
These CRDs would still be taxable to the account owner, but you can pay the tax over a three-year period.
To avoid taxation, CRDs can be repaid to an eligible retirement plan or IRA and treated as having satisfied the 60-day rollover requirements if repaid during the three-year period beginning the day after the CRD was received.
The Treasury has extended the tax return filing date to July 15, 2020, from April 15, 2020, so the date for making 2019 IRA and Roth IRA contributions is also extended to the same date. Normally, IRA contributions for a prior year must be made by April 15th of the following year.
The extended contribution deadline also applies to 2019 Health Savings Account, Archer Medical Savings Account, and Coverdell Education Savings Account (ESA) contributions.
And finally, beginning with 2020 income tax returns, you’ll be able to take a $300 above-the-line charitable income tax deduction – even if you take the standard deduction.
Again, this is just a high-level view of some of the many provisions of the CARES Act. Be sure to contact your financial advisor and tax professional to find out how they may apply to your situation.
***Want to learn more about how to protect your family from the government, lawsuits, accidental disinheritance, or nursing homes? Click THIS LINK to book a seat at one of our upcoming fun and educational workshops.***
Multigenerational living arrangements can be a gift for the entire family if careful planning is done.
Multi-generational living arrangements are not new, and as people are living longer it may start becoming more common. Shared households bring many benefits, including convenience. Why should a nurse daughter travel 20 miles a day to take her mom’s blood pressure, asks The Mercury’s article “Do shared living arrangements make sense?”
There’s also the benefit of increased financial security. Two households merged into one can share expenses, including mortgages, property taxes, utilities and more.
Whether this works in each case depends upon the situation and the relationships of the individuals involved. If there is flexibility and relationships are good, it can be a blessing. Imagine grandparents and grandchildren who are part of each other’s lives on a daily basis, rather than a twice-a-year visit. That’s a gift.
Multi-generational living arrangements need to start with a lot of discussions and good understanding of the wants and needs of each participant. It also needs to be based on reasonable expectations. A happy joint living arrangement can swiftly be derailed if parents assume that grandparents are willing to be 24/7 babysitters, or if grandparents consider household chores something for their children and grandchildren to do.
Joint living arrangements must also address financial considerations, estate planning, and everyone’s personal experiences and convictions. What works for one family may not work at all for another. Each family must work through their own details.
Here are some examples where a multi-generational living arrangement works.
Parents and children buy a house together. When parents and children live too far away, and the parent’s house would require too much modification for them to continue to live there, both sell their homes and buy a much bigger home that can be made handicapped accessible. The parents make most of the down payment. The house is titled in joint names. Titling is critical. One half is owned by the father and mother, the other half is owned by the spouse and adult child. Each half would be tenants by entireties (in states where that form of ownership between spouses is available) as between the spouses, but joint tenants with rights of survivorship as to the whole.
Parent moves in with adult child. A widow or widower comes to live with a son or daughter and their family. The parent makes contributions to the monthly expenses. A written agreement is very important for Medicaid rules regarding gifting. If modifications need to be made to the house—a mother-in-law suite, for example—a written agreement would detail who contributed what so that it is not considered a “gift” by Medicaid.
Adult child moves in with parent. This is a “buy-in,” where an adult child obtains a home equity line of credit to purchase an interest as joint tenant with right of survivorship. The house can be inherited by paying one-half of the value.
None of these strategies should be done without the help of an elder law attorney who is knowledgeable about Medicaid, estate planning, tax planning, and real estate ownership. When it works, this multi-generational living arrangement can benefit everyone in the family.
