The Wiewel Law Firm, an estate planning law firm in Austin, Texas
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Category: Powers of Attorney

What must be done when a loved one dies?

Why You Need an Advance Directive Right Now

The number of Americans who have died in the last few months because of COVID-19 is staggering, reports Inside Indiana Business in an article that advises readers to “Get Your Advance Directives in Place Now.”  This is why you need an advance directive right now. Just talking with family members about your wishes is not enough. You’ll need to put the proper legal documents in place. It’s not that hard, and it is necessary.

Only one in three Americans has completed any kind of advance directive. Many younger adults don’t feel the need to complete these documents, but there have been many examples that prove this is the wrong approach. Both Terri Schiavo and Karen Ann Quinlan were only in their twenties when they were not able to make their wishes known. Family members fought in and out of court for years.

The clinical realities of COVID-19 make it hard for healthcare workers to determine their patient’s wishes. Visitors are not permitted, and staff members are overwhelmed with patients. COVID-19 respiratory symptoms come on rapidly in many cases, making it impossible to convey end-of-life wishes.

Advance directives are the written instructions regarding health care decisions, if you are not able to communicate your wishes. They must be in compliance with your state’s laws. The most common types of advance care directives are the durable power of attorney for health care and the living will.

A durable power of attorney for health care names a person, usually a spouse or family member, to be a health care agent. You may also name alternative agents. This person will be able to make decisions about your health care on your behalf, so be sure they know what your wishes are.

A living will is the document that states your wishes about the type of care you do or don’t want to receive. Living wills typically concern treatments like CPR (cardiopulmonary resuscitation), breathing machines (ventilators), dialysis, feeding tubes and certain treatments, like the use of an IV (intravenous, meaning medicine delivered directly into the bloodstream).

Studies show that people who have properly executed advance directives are more likely to get care that reflects their stated preferences.

Traditional documents will cover most health situations. However, the specific symptoms of COVID-19 may require you to reconsider opinions on certain treatments. Many COVID-19 patients need ventilators to breathe and do subsequently recover. If in the past you wanted to refuse being put on a ventilator, this may cause you to reconsider.

Almost all states require notarization and/or witnesses for advance directives and other estate planning documents to be valid. Many states, including Indiana and New York, now allow for remote notarization.

Talk with your estate planning attorney about putting all of your estate planning documents in order.

Reference: Inside Indiana Business (June 8, 2020) “Get Your Advance Directives in Place Now”

 

What must be done when a loved one dies?

Plan for Your Pet During the Pandemic

If you have a pet, chances are you have worried about what would happen to your furry companion if something were to happen to you. However, worrying and having an actual plan are two very different things, as discussed at a Council of Aging webinar. Take the time to plan for your pet during the pandemic. That’s the subject of the article “COA speakers urge pet owners to plan for their animal’s future” that appeared in The Harvard Press.

It’s stressful to worry about something happening, especially during this pandemic, but it’s not that difficult to put something in place. After you’ve got a plan for yourself, your children and your property, add a plan for your pet.

Start by considering who would really commit to caring for your pet, if you had a long-term illness or in the event of your unexpected passing. Have a discussion with them. Don’t assume that they’ll take care of your pet. A casual agreement isn’t enough. The owner needs to be sure that the potential caretaker understands the degree of commitment and responsibility involved.

If you should need to receive home health care, don’t also assume that your health care provider will be willing to take care of your pet. It’s best to find a pet sitter or friend who can care for the pet before the need arises. Write down the pet’s information: the name and contact info for the vets, the brand of food, medication and any behavioral quirks.

There are legal documents that can be put into place to protect a pet. Your will can contain general directions about how the pet should be cared for, and a certain amount of money can be set aside in a will, although that method may not be legally enforceable. Owners cannot leave money directly to a pet, but a pet trust can be created to hold money to be used for the benefit of the pet, under the management of the trustee. The trust can also be accessed while the owner is still living. Therefore, if the owner becomes incapacitated, the pet’s care will not be interrupted.

An estate planning attorney will know the laws concerning pet trusts in your state. Not all states permit them, although many do.

A pet trust is also preferable to a mention in a will, because the caretaker will have to wait until the will is probated to receive funds to care for your pet. The cost of veterinary services, food, medication, boarding or pet sitters can add up quickly, as pet owners know.

A durable power of attorney can also be used to make provisions for the care of a pet. The person in that role has the authority to access and use the owner’s financial resources to care for the animal.

The legal documents will not contain information about the pet, so it’s a good idea to provide info on the pet’s habits, medications, etc., in a separate document. Plan for your pet during the pandemic. —your pet’s well-being may depend upon it!

Reference: The Harvard Press (May 14, 2020) “COA speakers urge pet owners to plan for their animal’s future”

 

What must be done when a loved one dies?

What Should I Keep in a Safe Deposit Box?

What should I keep in a safe deposit box? A safety deposit box isn’t a smart choice for everything. Kiplinger’s recent article entitled “9 Things You’ll Regret Keeping in a Safe Deposit Box” advises that there are some items you might not want to lock up in your bank, which isn’t open nights, holidays, or weekends. During this pandemic, hours of operation for many businesses are reduced. In fact, some financial institutions, like Bank of America, have temporarily closed some locations. There are other banks that require an appointment for in-branch services, like accessing your safe deposit box. This would create a headache for you in your attempt to retrieve important documents or items when you need them.

While keeping things in a safe deposit box is wise, there are some important items you should consider storing elsewhere, because you’ll need to access more often or on short notice. Maybe they should be in a fireproof safe that’s secured to the floor in your home.

Cash. Keeping a wad of cash in a safe deposit box, isn’t a good idea because if you need it in a pinch and the bank is closed, you’re out of luck. In addition, that cash will lose its buying power over time because of inflation and some banks don’t allow cash in a safe deposit box. Finally, cash in a safe deposit box isn’t protected by the FDIC. To have FDIC insurance (covering up to $250,000 per depositor per insured bank), your cash needs to be deposited in a qualifying deposit account, such as a checking account, savings account, or CD.

Your Passport. OK, most of us don’t need your passport in hand at a moment’s notice. However, you may need to take an emergency trip, which will happen during non-banking hours. Without your passport handy, there’s not much you can do about those calls in the middle of the night requiring you to dash.

The Original Copy of Your Will. You may want to keep a copy of your own will, your spouse’s and any in which you’re named the executor in a safe deposit box. However, don’t store the original copy of your will there, particularly if you’re the only owner. That’s because after your death, the bank will seal the safe deposit box, until your executor can prove she has the legal right to access it. This could mean a long and potentially expensive delay before your will is executed and your assets can be disbursed to the intended heirs. Keep the original copy of your will with your estate planning attorney or in a location where your executor can get to it without any legal hassles.

Letters of Instruction. Many people write a letter of instruction to accompany their will. This letter can describe whether you want to be buried or cremated and the type of service you want. This letter can include details on specific bequests of sentimental items, but it’s no help if its’ locked in your safe deposit box.

Durable Power of Attorney (POA). This document gives a trusted friend, family member, or professional adviser the authority to financial make decisions on your behalf. However, if your POA is in a safe deposit box that no one can access, the person you’re depending on to protect you at your time of need could find her hands tied. Keep the original POA with the original copy of your will and give copies to those who may need it one day.

Advance Directives. A living will and a health care proxy are sometimes collectively known as advance directives, but each has a unique purpose. A living will states your wishes for end-of-life care, and a health care proxy (also known as a health care power of attorney) names a person to make medical decisions for you, if you can’t make them yourself. Neither is any good locked away in an inaccessible safe deposit box.

Uninsured Jewelry and Collectibles. Heirloom jewelry and your valuable stamp collection and rare coins are good candidates for a safe deposit box, but they must be properly insured. The FDIC doesn’t insure contents, and neither does the bank, unless it’s stated in your agreement.

Any Illegal or Dangerous Items. Your bank should provide you with a list of items that are not permissible to keep in a safe deposit box. This will include things like firearms, illegal drugs and hazardous materials.

Reference: Kiplinger (June 1, 2020) “9 Things You’ll Regret Keeping in a Safe Deposit Box”

 

What must be done when a loved one dies?

Your Children Wish You Had an Estate Plan

It is the adult children who are in charge of aging parents when they need long-term care. They are also the ones who settle estates when parents die. Even if they can’t always come out and tell you, your children wish you had an estate plan. The recent article, “Why your children wish you had an Elder Law Estate Plan” from the Times Herald-Record spells out exactly why an elder law estate plan is so important for your loved ones.

Avoid court proceedings while living. In a perfect world, everyone over age 18 will have an advance directive, including a power of attorney, a health care proxy, and a living will. These documents appoint others to make financial, legal, and medical decisions, in case of incapacity. Without them, the children will have to get involved with time-consuming, expensive guardianship proceedings, where a judge appoints a legal guardian to make these decisions. Your life is turned over to a court-appointed guardian, instead of your children or another person of your choosing.

Avoid court proceedings after you die. If you die and assets are in your name alone, then your estate will go through probate, a court proceeding that can be time consuming and costly. Not having any assets in trusts leaves your kids open to the possibility of wills being challenged, disputes among family members and litigation that can drag on for years.

Wills in probate court are public documents. Trusts are private documents. Do you really want a stranger to access your will and learn about your assets?

An elder law estate plan also plans for the possibility of long-term care and costs. Nursing home care costs can run between $12,000—$18,000 per month. If you don’t have long-term care insurance, you can create a Medicaid Asset Protection Trust (MAPT) that protects assets in the trust from nursing home costs, once the assets are in the trust for five years. The MAPT also protects assets from homecare provided by Medicaid, called “community” Medicaid, once the assets are in the trust for 30 months under a new rule that starts on October 1, 2020.

The “elder law power of attorney” has unlimited gifting powers that could save about half of a single person’s assets from the cost of nursing homes. This can be done on the eve of needing nursing home care, but it is always better to do this planning in advance.

Having a plan in place decreases stress and anxiety for adult children. They are likely busy with their own lives, working, caring for their children and coping in a challenging world. When a plan is in place, they don’t have to start learning about Medicaid law, navigating their way through the court system, or wondering why their parents did not take advantage of the time they had to plan properly.

You probably don’t want your children remembering you as the parents who left a financial and legal mess behind for the them to clean up. Speak with an elder law estate planning attorney to create a plan for your future. Your children will appreciate it.

Reference: Times Herald-Record (May 23, 2020) “Why your children wish you had an Elder Law Estate Plan”

What must be done when a loved one dies?

What You Need to Do after a Loved One Dies

The Dallas Morning News’ recent article entitled “Three things to do on the death of a loved one” explains the steps you should take, if you are responsible for a family member’s assets after they die.

Be sure the property is secured. A deceased person’s property becomes a risk in some instances. Friends and family will help themselves to what they think they should get, including the deceased’s personal property. Once it is gone, it is hard to get it back and into the hands of the individual who’s legally entitled to receive it.

Criminals also look at the obituaries, and while everyone is at the funeral or otherwise unoccupied, burglars can break into the house and steal property. Assign security or ask someone to stay at the house to protect the property. You can also change the locks. Credit cards, debit cards, and checks need to be protected. The deceased’s mail must be collected, and cars should be locked up.

Make funeral plans. If you’re lucky, the deceased left a written Appointment of Burial Agent with detailed instructions, which can make your job much easier.

For example, Texas law lets a person appoint an agent to be in charge of funeral arrangements and to describe the arrangements. An estate planning attorney can draft this document as part of an estate plan. You should see if this document was included. If you’re listed as the agent, present the paper to the funeral home and follow the instructions. If there are no written instructions, the law will say who has the authority to make arrangements for the disposition of the body and to plan the funeral.

Talk to an experienced attorney. When a person dies, there is often a lapse in authority. The decedent’s power of attorney is no longer in effect, and the executor designated in the will doesn’t have any authority to act, until the will is admitted to probate and the executor is appointed by the probate judge and qualifies by taking the oath of office and filing a bond, if required. Direction is needed earlier rather than later, on what you’re permitted to do. The probate of a will takes time.

It is best to get started promptly, so that there’s an executor in place with power to handle the affairs of the decedent.

Reference: Dallas Morning News (April 10, 2020) “Three things to do on the death of a loved one”

 

What must be done when a loved one dies?

What Do I Do If I’m Named Financial Power of Attorney?

A financial power of attorney (POA) is a document whereby the “principal” appoints a trusted someone known as the “attorney-in-fact” or “agent” to act on behalf of the principal, especially when the principal is incapacitated. It typically permits the attorney-in-fact to pay the principal’s bills, access his accounts, pay his taxes and buy and sell investments or even real estate. In effect, the attorney-in-fact steps into the shoes of the principal and is able to act for him in all matters, as described in the POA document.

Kiplinger’s recent article entitled “What Are the Duties for Financial Powers of Attorney?” says these responsibilities may sound overwhelming, and it’s only natural to feel this way initially. Let’s look at the steps to take to do this important job:

  1. Don’t panic but begin reading. Review the POA document and determine what the principal has given you power to do on his behalf. A POA will typically include information addressed to the agent that explains the legal duties he or she owes to the principal.
  2. See what you have to handle for the principal. Create a list of the principal’s assets and liabilities. If the principle is organized, it’ll be easy. If not, you will need to find their brokerage and bank accounts, 401(k)s/IRAs/403(b)s, the mortgage, taxes, insurance and other bills (utilities, phone, cable and internet).
  3. Protect the principal’s property. Be sure the principal’s home is secure and make a video inventory of the home. If it looks like your principal will be incapacitated for an extended period of time, you may cancel the phone and newspaper subscriptions. You may need to change the locks on the principal’s home. If you have control of the principal’s investments and their incapacitation may continue for a long time, review their brokerage statements for high-risk positions that you don’t understand, like options, puts and calls, or commodities. Get advice on liquidating positions you don’t have the know-how to handle.
  4. Pay all bills, as necessary. Look at your principal’s bills and credit card statements for potential fraud. Perhaps you should suspend their credit cards that you won’t be using on the principal’s behalf. Note that they may have bills automatically paid by credit card and plan accordingly.
  5. Pay the taxes. Many powers of attorney give the agent the power to pay the principal’s taxes. If so, you’ll be responsible for filing and paying taxes during the principal’s lifetime. If the principal passes away, the executor of the principal’s last will is responsible for preparing any final taxes.
  6. Keep meticulous records. Track every expenditure you make and every action you take on the principal’s behalf. You’ll be asked to demonstrate that you have upheld your duties and acted in the principal’s best interests. It will also be important for you to receive reimbursement for expenses, and (if the power of attorney provides for it) the time you spent acting as agent.

Finally, you must always act in the principal’s best interest.

Reference: Kiplinger (April 22, 2020) “What Are the Duties for Financial Powers of Attorney?”

 

What must be done when a loved one dies?

Prevent Estate Administration Problems Before They Occur

Estate administration, that is, when the executor gets busy with paying debts, taxes and distributing assets, is often the time when any missing steps in an estate plan are revealed. The best legal problems are the ones that don’t happen, advises the article “Practical tips for estate administration, pre-planning advice, and a Coronavirus update” from the Winston-Salem Journal. Here are tips to avoid problems:

Do you need a trust to avoid probate fees and simplify estate administration?

Think of a trust as a secret box or bank account. If you own property in another state, want adult heirs to receive their inheritance over a period of time, have a beneficiary with special needs, or simply don’t want the public to learn about your assets, then a stand-alone trust that works in conjunction with your will is something to consider. However, you may be able to achieve some of these goals through beneficiary designations. A big advantage of a trust is that it is not subject to probate; assets in a probate estate become public record. If privacy is an issue, you’ll want a trust.

Is your estate plan out of date?

If your estate plan has not been updated in the last three or four years, it is likely that you have extra expenses that are no longer necessary. It’s also likely that you are missing out on tax savings opportunities. There have recently been a huge number of changes to estate and tax laws. If your will was signed before 2013, it is time to simplify your will.

Did you inherit real estate with your siblings?

If the sale of the property is still pending, get it wrapped up as soon as possible. If one of your siblings dies, or moves away, managing the disposition of real estate can become complicated and expensive.

When was the last time you reviewed Power of Attorney documents?

If you are not competent and critical steps need to be taken for your care, your agents may find themselves unable to act on your behalf, if your POA and related documents are “outdated.” They may need court intervention to make even simple decisions.

How has coronavirus impacted choices in long-term planning documents?

If your will, POA, medical power of attorney and HIPAA release forms have not been updated recently, decisions may be made without any discussion with the people you trust most.

Speak with an estate planning attorney now to get your legal and financial affairs in order. Many states have granted attorneys the ability to have documents executed and witnessed remotely, so there is no reason not to go forward now.

Reference: Winston-Salem Journal (May 3, 2020) “Practical tips for estate administration, pre-planning advice, and a Coronavirus update”

 

What must be done when a loved one dies?

Retirement Planning and Declining Abilities

Whether the reason is Alzheimer’s, Parkinson’s or any of a number of illnesses that lead to dementia, it’s hard for families to think about legal or financial concerns, when a diagnosis is first made. This can lead to serious problems in the near future, warns the article “Cognitive Decline Shouldn’t Derail Retirement Planning. Here are Some Tips to Prepare Your Finances” from Barron’s. The time to act is as soon as the family realizes their loved one is having a problem—even before the diagnosis is official.

Here are some useful tips for navigating cognitive decline:

Take an inventory. Families should create a detailed list of assets and liabilities, including information on who has access to each of the accounts. Don’t leave out assets that have gone paperless, like online checking, savings, credit card and investment accounts. Without a paper trail, it may be impossible to identify assets. Try to do this while the person still has some ability to be actively involved. This can be difficult, especially when adult children have not been involved with their parent’s finances. Ask about insurance policies, veterans’ benefits, retirement accounts and other assets. One person in the family should be the point person.

Get an idea of what future costs will be. This is the one that everyone wants to avoid but knowing what care costs will be is critical. Will the person need adult day care or in-home care at first, then full-time medical care or admission to a nursing facility? Costs vary widely, and many families are completely in the dark about the numbers. Out-of-pocket medications or uncovered expenses are often a surprise. The family needs to review any insurance policy documents and find out if there are options to add or amend coverage to suit the person’s current and future needs.

Consider bringing in a professional to help. An elder law estate planning attorney, financial planner, or both, may be needed to help put the person’s legal and financial affairs in order. There are many details that must be considered, from how assets are titled, trusts, financial powers of attorney, advance health care directives and more. If Medicaid planning was not done previously, there may be some tools available to protect the spouse, but this must be done with an experienced attorney.

Automate any finances if possible. Even if the person might be able to stay in their own home, advancing decline may make tasks, like bill paying, increasingly difficult. If the person can sign up for online banking, with an adult child granted permission to access the account, it may be easier as time goes by. Some monthly bills, such as insurance premiums, can be set up for automatic payment to minimize the chances of their being unpaid and coverage being lost. Social Security or Supplemental Security Income benefits are now required to be sent via direct deposit or prepaid debit card. If a family member is still receiving a paper check, then now is the time to sign up for direct deposit, so that checks are not lost. Pension checks, if any, should also be made direct deposit.

Have the correct estate planning documents been prepared? A health care representative and a general durable power of attorney should be created, if they don’t already exist. The durable power of attorney needs to include the ability to take action in “what if” cases, such as the need to enroll in Medicaid, access digital assets and set up any trusts. A durable power of attorney should be prepared before the person loses cognitive capacity. Once that occurs, they are not legally able to sign any documents, and the family will have to go through the guardianship process to become a legal guardian of the family member.

Reference: Barron’s (Jan. 11, 2020) “Cognitive Decline Shouldn’t Derail Retirement Planning. Here are Some Tips to Prepare Your Finances”

What must be done when a loved one dies?

Requests for Estate Plans Reflect Fears about Coronavirus

Estate planning lawyers have always known that estate planning is not about “if,” but about “when.” The current health pandemic has given many people a wake-up call. They realize there’s no time to procrastinate, reports the article “Surge on wills: Fearing death by coronavirus, people ask lawyers to write their last wishes” from InsuranceNews.net. Legal professionals urge everyone, not just the elderly or the wealthy, to put their end-of-life plans in writing.

The last time estate planning attorneys saw this type of surge was in 2012, when wealthy people were worried that Congress was about to lower the threshold of the estate tax. Today, everyone is worried.

Top priorities are creating a living will stating your wishes if you become incapacitated, designating a surrogate or a proxy to make medical decisions on your behalf, granting power of attorney to someone who can make legal and financial decisions and preparing advance directives, such as “Do Not Resuscitate” orders.

An estate plan, including a last will and testament (and often trusts) that detail what you want to happen to assets and who will be guardian to minor children upon your death, spares your family the fights, legal costs and hours in court that can result when there is no estate plan.

The coronavirus has created a new problem for families. In the past, a health care surrogate would be in the hospital with you, talking to healthcare providers and making decisions on your behalf. However, now there are no visitors allowed in hospitals and patients are completely isolated. Estate planning attorneys are recommending that specific language be added to any end of life documents that authorize a surrogate to give instructions by phone, email or during an online conference.

Any prior documents that may have prohibited intubation need to be revised, since intubation is part of treatment for COVID-19 and not necessarily just an end-of-life stage.

Attorneys are finding ways to ensure that documents are properly witnessed and signed. In some states, remote signings are being permitted, while other states, Florida in particular, still require two in-person witnesses, when a will or other estate planning documents are being signed.

There are many stories of people who have put off having their wills prepared, figuring out succession plans that usually take years to plan and people coming to terms with what they want to happen to their assets.

Equally concerning are seniors in nursing homes who have not reviewed their wills in many years and are not able to make changes now. Older adults and relatives are struggling with awkward and urgent circumstances, when they are confined to nursing homes or senior communities with no visitors.

Reference: InsuranceNews.net (April 3, 2020) “Surge on wills: Fearing death by coronavirus, people ask lawyers to write their last wishes”