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Monthly Archives

October 2015

Clauses to Include in a Will or Living Trust

By Asset Protection Planning, Elder Law, Estate Planning

While everyone needs individualized legal advice on what language their estate planning documents should contain, the following are some of the most common and important clauses which should be discussed with the lawyer preparing your will or living trust.

  • Revocation: Previously written wills or trusts should be revoked to avoid the court intervening later to decide which parts of certain documents should be followed.
  • Disaster Clause: This clause helps plan what will happen to your assets if both you and your spouse or main beneficiary die at the same time.
  • Appointment of personal representative: While doing estate planning you will need to name someone as your Personal Representative who will be in charge of distributing the assets in your estate.
  • Guardianship of children: If you have minor children, it is very important that you name someone as their guardian in the event that you or you and your spouse die.
  • Spendthrift Provision: This clause prevents the beneficiary of your assets from transferring their rights to those assets. A spendthrift provision is often used to protect assets from creditors.
  • Total failure: Total failure would occur if all heirs of your estate died before inheriting your assets. This is an extremely rare situation but, without a total failure clause, your estate would go to the government in this circumstance.  A total failure clause allows you to instead designate an organization of your choice for the estate to be given to.

If you have questions about what should be in your estate planning documents to ensure all of your wishes are met and your assets are distributed exactly as you desire, contact our office at (941) 906-1231 to speak with an experienced estate planning attorney.

October 30, 2015
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What to Include in a Letter of Instruction to Your Family about End of Life Wishes

By Estate Planning, Probate

To minimize your family’s level of distress and conflict after your death, consider writing a letter of instruction to ensure they understand and will honor your desires.  This letter is not to replace other estate planning documents but is a helpful tool used to help your loved ones with funeral arrangements and the handling of your personal and financial documents.  The following is a list of items you should remember to include in this letter of instruction to make it as clear as possible.

  • List anyone (including individuals and groups) who you want to be notified of your death. If there is anyone who you do not want to be notified, include this as well.  If you can, include updated contact information.
  • Describe what burial method you would like and indicate whether you have already paid for funeral arrangements. Also describe any specifics about what you want your funeral to look like.
  • Make a list of all financial accounts and contact info for people associated with your accounts and estate planning such as attorneys, financial planners, stockbrokers, etc.
  • If your estate planning documents include donating any of your assets to charity, list relevant contact info for the recipients.
  • Give the location of important personal documents such as birth certificate, marriage certificates, divorce papers, etc. This information should be in a secure location which only certain trusted people, such as the personal representative of your will, can access.
  • State planned arrangements for who should care for your pet and how. Pet trusts can also be set up to provide more structure to pet care.

For help ensuring your estate plan is clear and will allow your assets to be distributed exactly as you desire, contact our office at (941) 906-1231.

October 27, 2015
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How can I give specific belongings to members of my family?

By Asset Protection Planning, Estate Planning, Probate

You may have done estate planning to designate who your major assets, such as homes, vehicles, and life insurance policies, will be passed along to but incorporating smaller personal belongings into your estate plan is also necessary to make sure you are able to choose which beneficiaries will get your collections or items with sentimental or monetary value.

As long as the items you have in mind are tangible personal property, they can be listed along with your desired beneficiary of them on a personal property list that your other estate planning documents mention.  A personal property list is highly flexible as you can change it as you desire without redoing anything else in your estate plan.

Personal property lists can be useful for conveying many items but if the items you have in mind are particularly valuable, either monetarily or emotionally, it may be recommended that you describe who you want these items to be passed to explicitly in your will or trust.  This more formal, less easily modified method is generally more binding and can better prevent conflict among beneficiaries.

If you have further questions or would like help planning for specific items in your estate, contact our office today at (941) 906-1231.

October 20, 2015
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What are the duties of the Trustee of an irrevocable life insurance trust (ILIT)?

By Asset Protection Planning, Elder Law, Estate Planning

It is important for Trustees of irrevocable life insurance trusts to understand their duties which exist even while the insured is alive.  Some of the most important duties are:

  • The Trustee must pay premiums on the policy. This money would usually be added to the trust by the insured person as each premium comes due.
  • The money added to the trust by the insured is taxable unless the Trustee issues a “Crummey” notice to each beneficiary letting them know that they do have the right to ask for a part of that money added to the trust to pay the policy’s premium. Issuing a Crummey notice qualifies this added money for a gift tax exemption.
  • The Trustee could be held responsible if the insurance company through which the policy is purchased becomes financially insolvent and the Trustee did not anticipate and prevent financial losses.
  • The trustee could also be held responsible if they are found to have made very poor investment or management decisions which resulted in the loss of funds.
  • The trustee must ensure they do not have a conflict of interest such as receiving part of the insurance broker’s commission.
  • A Trustee has the right to withdraw money from the ILIT to loan to the insured.

 

When agreeing to become the Trustee of an irrevocable life insurance trust, it is important to understand what your duties will be and have a plan in place for executing them properly.  If you have further questions about this post or a specific ILIT, contact our office at (941) 906-1231.

October 16, 2015
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What is innocent spouse relief and am I entitled to it?

By Tax Law

Many married couples file joint tax returns but problems can ensue when the IRS determines that under-payment has occurred and decides criminal fraud has taken place.  It is often the case that one person signs a tax return without really looking closely at what their spouse is reporting about their own business.  In this case, one party may be entitled to innocent spouse relief.  If you believe there were errors in the tax return you signed, believe you may be entitled to innocent spouse relief, or are wondering whether you should file a joint return, especially if you have a divorce pending, please contact our Board Certified Tax Attorney Fredric Jacobs at (941) 906-1231.

October 13, 2015
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Probate and Alternative Dispute Resolution

By Elder Law, Estate Planning, Probate

            Probate disputes can become time consuming and expensive processes which is why many prefer to settle outside of court through arbitration or mediation as alternatives to a full court proceeding.  These processes are less formal than court proceedings and, consequently, are also more flexible.  Through arbitration, both parties agree to adhere to the decision made by a third party arbitrator who usually specializes in certain types of cases.  In mediation, a third party works to propose a solution which both parties will agree to. Both processes allow each side to present their personal view of the case and can lead to creative solutions compared to standard court decisions.

October 9, 2015
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New law signed by President Obama will require hospitals to provide Observation Status notice to patients:

By Elder Law, Medicare

When an individual goes to the hospital, they may not be admitted right away.  If one is not “admitted” to the hospital, Medicare will not pay for hospitalization and a patient may have a large medical bill as a result.  There may be a period in which an individual is being “assessed”.  This is called “Observation Status”.   Observation status ends once a patient is admitted or discharged.

After a three (3) night hospital stay, Medicare will cover rehabilitation.  Previously, patients are not aware of the difference between observation status and being admitted.  The new law known as Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act signed by President Obama will take effect one year from August 6, 2015, the date it was signed.  Hospitals have to develop a notification system within this year.

The new law will require the hospitals to give notice to the patients who have been under observation status for more than 24 hours of their outpatient status within 36 hours or upon discharge, whichever happens sooner.  The notice must advise the patient of their outpatient status and advise that their stay does not qualify for rehabilitation services covered by Medicare because they did not meet the three (3) night requirement.

This is one step closer to ensuring hospital patients are properly being informed.

October 7, 2015
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What is a qualified disclaimer and when should it be used?

By Asset Protection Planning, Elder Law, Estate Planning, Probate, Tax Law

If for financial or tax reasons you do not wish to receive an asset for which you are a beneficiary, you can use a qualified disclaimer to pass this asset instead to other listed beneficiaries.  This may be beneficial for individuals who do not wish to claim an asset they are set to inherit for tax purposes.  To make sure your qualified disclaimer is compliant with IRS codes it must be in writing, delivered within a set amount of time dependent on specific circumstances, and irrevocable.  The assets you disclaim cannot be directed by you and will usually pass to the spouse of the decedent.

It is important to consult an experienced attorney when planning to submit a qualified disclaimer.  Contact our Board Certified Tax Law Attorney Fredric Jacobs, Esq. at (941)  906-1231.

October 6, 2015
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Privacy of Estate Planning Documents

By Elder Law, Estate Planning

During estate planning, it is crucial to learn about the different levels of privacy that various estate planning documents provide you.  If you choose to leave assets through a will, that will and its contents become public after your death.  After a will becomes public record, it is available for viewing in the county in which the person it was written for was living or domiciled at their death.  To keep your desires for your assets private after your death a trust may be a more appropriate estate planning document because of the privacy protection it provides.  For example, the full terms of the trust are not recorded in the public record, unlike a will.  If you have more specific questions about the privacy of your estate planning documents after your death, contact our office at (941) 906-1231.  We have attorneys who provide estate planning services have experience in providing these services to high net worth families who can help assure your desires for privacy are met as your plan for your estate.

October 2, 2015
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