Richmond Virginia Estate Planning, Elder Law, And Asset Protection

C19 UPDATE: Bookmark this Page from the IRS for Ongoing Coronavirus Updates

The IRS has established a special section focused on steps to help taxpayers, businesses and others affected by the coronavirus. This page will be updated as new information is available. https://www.irs.gov/coronavirus

For health information about the COVID-19 virus, visit the Centers for Disease Control and Prevention (CDC) https://www.coronavirus.gov

Other information about actions being taken by the U.S. government visit https://www.usa.gov/coronavirus and in Spanish at https://gobierno.usa.gov/coronavirus.

The Department of Treasury also has information available at Coronavirus: Resources, Updates, and What You Should Know https://home.treasury.gov/coronavirus

Aretha Franklin’s Niece Resign as Executor

Sabrina Owens, the niece of soul singer Aretha Franklin, recently announced her resignation as executor in probate court filings, stating: “Given my aunt’s love of family and desire for privacy, this is not what she would have wanted for us, nor is it what I want … I hope that my departure will allow the business of the estate to continue, calm the rift in my family and allow me to return to my personal life.”

Rolling Stone’s recent article entitled “Aretha Franklin’s Niece Resigns as Estate Executor” reminds us that Franklin died in August of 2018, and, because she reportedly was intestate, Michigan law states that her assets are to be distributed equally among her four sons. Her sons agreed upon Owens as executor, but new family politics came up last May after three wills allegedly authored by Franklin were discovered in a notebook under some couch cushions.

“That is when relationships began to deteriorate with the heirs,” Owens wrote of the discovery of the wills. She added that she accepted the executor role on the condition that “no fractured relationships develop within the family” and that the family “did not end up in court disputes over disagreements with the Estate.” Both, Owens wrote, have happened.

Owens’ resignation, however, will not become effective immediately. Instead, she will keep serving as executor for the immediate future. It’s also unknown who will be appointed executor after she does leave.

Franklin’s youngest son, Kecalf, has attempted to gain control, since one of the documents from 2014 appears to state that Franklin wanted him to take on that role (in August, a probate judge approved Kecalf’s request to have a handwriting expert analyze the documents that were found).

Although Kecalf has the support of his brother Edward, his plan is opposed by Franklin’s third son, Ted White, as well as the guardian for her eldest son, Clarence, who has special needs.

A hearing on the future of the estate is scheduled for early this spring.

The ongoing battles surrounding Franklin’s estate continue, as it gets ready for two significant posthumous projects: one is a biopic movie starring Jennifer Hudson, “Respect.” The other is an installment in the biographical anthology series, “Genius,” with Cynthia Erivo playing Franklin (both are currently in production).

In the last year, Owens, as executor, oversaw the release of the documentary, ‘Amazing Grace,” while at the same time managing the estate’s complicated finances, including $6.3 million owed to the IRS in back taxes.

Reference: Rolling Stone (Feb. 3, 2020) “Aretha Franklin’s Niece Resigns as Estate Executor”

 

C19 UPDATE: If You Have Not Yet Named Someone as Agent under Your Medical Power of Attorney, Do It Now

If you have not yet named someone as your agent under a Medical Power of Attorney, stop procrastinating and get this crucial planning in place now.

What is a Medical Power of Attorney?

A medical power of attorney is a legal document you use to give someone else authority to make medical decisions for you when you can no longer make them yourself.  This person, also known as an agent, can only exercise this power if your doctor says you are unable to make key decisions yourself.

Other Terms for Medical Power of Attorney

In Virginia, a medical power of attorney and a living will, together, are called an “Advance Medical Directive.” Depending on the state where you live, the medical power of attorney may be called something else. You may have seen this referred to as a health care power of attorney, an advance directive, advance health care directive, a durable power of attorney for health care, etc. There are many variations, but they all mean fundamentally the same thing.

Be aware that each state has their own laws about medical powers of attorney, so it’s important to work with a qualified estate planning attorney to ensure your decisions will be enforced through legally binding documents. Also, medical professionals in some states may not honor documents from other states, so even if you made these decisions and created documents in another state, it’s wise to review with an estate attorney to ensure they are legally valid in your state now.

What Can My Medical Agent Do for Me?

Just like there are many different terms for the medical power of attorney, there also are different terms for the medical agent – this person may be referred to as an attorney-in-fact, a health proxy, or surrogate.

Some of the things a medical power of attorney authorizes your agent to decide for you:

  • Which doctors or facilities to work with and whether to change
  • Give consent for additional testing or treatment
  • Give consent to pain relief in excess of standard dosages
  • Determine who can, and cannot, visit you in the hospital
  • How aggressively to treat you
  • Whether to take part in medical studies
  • Whether to disconnect life support

When the terrible campus shooting occurred in Blacksburg, Virginia in 2007, there were so many injuries that students were taken to dozens of hospitals in cities and towns up and down the Shenandoah Velley and beyond. Frantic parents placed calls to many of them, desperate for information on their children. Some got right through. Others were told they could not disclose patient information due to privacy concerns since there was no medical power of attorney named.

This means advance medical directives and HIPPA disclosure forms are not just for older Americans. Everyone over the age of 18 should have them. Now, while most college students are home on furlough from campus due to the Covid virus is a good time to ask an estate lawyer about health planning documents for everyone.

 

Protect_Your_Legacy_in_Richmond_Virginia

What Is So Important About Powers Of Attorney? (Especially Now?)

Powers of attorney can provide significant authority to another person, if you are unable to do so. These powers can include the right to access your bank accounts and to make decisions for you. Having the right power of attorney, right now, is more important than ever.

AARP’s article from last October entitled, “Powers of Attorney: Crucial Documents for Caregiving,” describes the different types of powers of attorney.

Just like it sounds, a specific power of attorney restricts your agent to taking care of only certain tasks, such as paying bills or selling a house. This power is typically only on a temporary basis.

A general power of attorney provides your agent with sweeping authority. The agent has the authority to step into your shoes and handle all of your legal and financial affairs.

The authority of these powers of attorney can stop at the time you become incapacitated. Durable powers of attorney may be specific or general. However, the “durable” part means your agent retains the authority, even if you become physically or mentally incapacitated. In effect, your family probably won’t need to petition a court to intervene, if you have a medical crisis or have severe cognitive decline like late stage dementia.

In some instances, medical decision-making is part of a durable power of attorney for health care. This can also be addressed in a separate document that is just for health care, like a health care surrogate designation.

Virginia is among the states that recognize “springing” durable powers of attorney. With these, the agent can begin using her authority, only after you become incapacitated. Other states don’t have these, which means your agent can use the document the day you sign the durable power of attorney.

A well-drafted power of attorney helps your agent help you, because she can keep the details of your life addressed, if you cannot. That can be things like applying for financial assistance or a public benefit, such as Medicaid, or verifying that your utilities stay on and your taxes get paid. Attempting to take care of any of these things without the proper document can be almost impossible.

A poorly drafted power of attorney, or one not tailored to your needs now, could make it difficult or impossible for a loved on to apply for important government health care benefits you could need down the road. (Or sooner!)

In the absence of proper incapacity legal planning, your loved ones will need to initiate a court procedure known as a guardianship or conservatorship. However, these hearings can be expensive, time-consuming and contested by family members who don’t agree with moving forward.

Don’t wait to do this. Every person who’s at least age 18 should have a power of attorney in place. If you do have a power of attorney, be sure that it’s up to date. Ask an experienced elder law or estate planning attorney to help you create these documents. And we have no-contact consultations available right now via phone or Zoom Meeting.  Call us now.

Reference: AARP (October 31, 2019) “Powers of Attorney: Crucial Documents for Caregiving”

C19 UPDATE: Emergency Estate Planning Decisions to Make Right Now

Though it is hard not to panic when our grocery store shelves are empty, the number of confirmed cases of COVID-19 keeps rising — a friend of mine just posted his positive diagnosis yesterday — and we see sobering statistics here and across the globe It is clear we will not overcome this challenge with a panicked response. Or by failing to act.

Clearly, there are things we all need to be doing right now – and Virginia public health officials are the best resource on how to stay personally safe and help prevent the virus from spreading.

When it comes to the seriousness of this outbreak, however, there also are some critical estate planning decisions you should make – or review – right now.  You nay be sitting at home mire this week.  It is a good time to ask yourself these questions:

  1. Who will make medical decisions for me should I become severely ill and unable to make these decisions myself?
  2. Who will make my financial decisions in that same situation — for example, who will be authorized to sign my income tax return, write checks or pay my bills online?
  3. Who is authorized to take care of my minor children in the event of my severe illness? What decisions are they authorized to make? How will they absorb the financial burden?
  4. If the unthinkable happens – what arrangements have I made for the care of my minor children, any family members with special needs, my pets or other vulnerable loved ones?
  5. How will my business continue if I were to become seriously ill and unable to work, even remotely … or in the event of my death?

These are the most personal decisions to make right now to protect yourself and your loved ones during this emergency. Now is also a good time to ask yourself if you have plans in place for the smooth transfer of your assets and preservation of your legacy.

We are ready to help walk you through these decisions, understand the ramifications of your choices, and memorialize your plans in binding legal documents. The Nance Law Firm is currently offering no-contact initial conferences remotely, including consultations via Zoom Meetings. In other words, you may be able to use some of your down time to take care of decisions you may have put off.  Book a call now and let us help you make the right choices for yourself and your loved ones.

Charles Nance Richmond Virginia Attorney

C19 UPDATE: Employers Now May Help Employees with Tax-Free Direct Disaster Relief Assistance

As the coronavirus pandemic emergency unfolds, it’s clear that increasing numbers of employees will likely suffer financial impacts … from quarantines, illnesses, workplace closings, etc. President Trump’s declaration of a national emergency on March 13 now allows employers to make direct disaster-relief payments to assist employees affected by the virus.

These types of payments are not treated as income/wages to the employees and are deductible to the employer as ordinary and necessary business expenses. There is no specific cap on the amount of assistance that may be provided to an employee other than it must be “reasonable and necessary” and must not be for an expense reimbursable by the employee’s insurance.

Section 139 of the Internal Revenue Code, allows that a “qualified disaster relief payment” of any amount may be paid to reimburse or pay reasonable and necessary personal, family, living or funeral expenses (not otherwise compensated for by insurance) incurred because of a “qualified disaster.” The term “qualified disaster” includes a federally declared disaster or emergency under the Stafford Act. Accordingly, due to the Declaration, Coronavirus is now a “qualified disaster” for Section 139 purposes, so disaster relief may be provided to employees on a tax-free basis (assuming all the requirements of Section 139 are satisfied).

Now. If only our small business clients had more income to share!

As always check with your CPA or tax attorney before implementing any tax planning strategy for your business.

Read more at The National Review, Coronavirus National Emergency Declaration Permits Employers to Offer Tax-Favored Financial Assistance to Employees, March 14, 2020

 

An Estate Plan Is Necessary for the Unthinkable

As an estate planning attorney, I was gratified to see “Debbie Downer” return to SNL last week. She reminds us. Bad stuff happens. As if the spreading Coronavirus wasn’t reminder enough. And we have to be ready. Someone sent me a recent article from California’s The Press Enterprise titled Yes, you must go there: Think about the unthinkable, plan for the worst” which explains the steps.

Put an appointment in your schedule. Make an appointment with a qualified estate planning attorney. If you make the call and have an actual appointment, you have a deadline and that’s a start. The attorney may have a planning worksheet or organizer that he or she can send to you to guide you.

Start getting organized. If this seems overwhelming, break it out into separate parts. Begin with the easy part: a list of names, addresses, phone numbers, and email addresses for family members. Include any other people who you intend to include in your estate plan.

Next, list your assets and an estimated value of each. It doesn’t have to be to the penny. Include the account numbers, name of the institution, phone number and, if you have a personal contact, a name. Include bank accounts, real estate holdings, timeshares, stocks, bonds, personal property, vehicles, RVs, any collectibles of value (attach appraisals if you have them), life insurance and retirement accounts. Don’t just list what you own, but how you own it: joint, separate, payable on death, etc.  See What Should I Know about Beneficiary Designations?

List the professionals who you rely on—your estate planning lawyer, CPA, financial advisor, etc.

If you own a firearm, include your license and make sure that both your spouse and your estate planning attorney are aware of the information. Speak with your estate planning attorney about the law in your state and how to prepare for a situation if the firearm needs to be safely and properly dealt with. And your trustee or executor could get in serious trouble for transferring a firearm to a prohibited person upon your death.

Name an executor or personal representative. Estate planning is not just for death. It is also for incapacity. Who will act on your behalf, if you are not able to do so? Many people name their spouse, a long-time trusted friend or a family member. Be certain that person will be willing to act on your behalf and carry out your instructions. Have a second person also named, in case something occurs, and your first choice cannot serve.

If you have minor children, your estate plan will include a guardian, who will be responsible for raising them. Talk about that with your spouse and that person to make sure they are willing to serve. You can also name a second person to be in charge of finances for the children. Your estate planning lawyer will talk with you about the role of trusts to provide for the children.

Think about your overall goals. How do you see your legacy? Do you want to leave some funds for a charity that has meaning to you and your family? Do you want your children to receive equal shares of your entire estate? Does one child require special needs planning, or are you concerned that one of your children may not be able to manage an inheritance? These are all topics to discuss with your estate planning attorney. Their experience will help clarify your goals and create a plan.

Reference: The Press Enterprise (Feb. 2, 2020) Yes, you must go there: Think about the unthinkable, plan for the worst

Our Response to COVID-19: “No Time to Go Dark!”

Greetings from the Nance Law Firm!

Whitney_Hendrix_Executive_Assistant_Richmond_Virginia

Many of our clients are considered “at risk” for the Coronavirus or secondary reactions to it. If they are not knowingly at risk, they often care for those who are. They depend on us, and this is no time for our firm to go dark. And we are going to be here for them at all times.

For clients and friends who’ve asked or wondered, the Nance Law Firm continues to be open during regular hours: Monday – Friday, 8:30am to 5pm. (As usual we see clients by appointment only.) Cleaning and sanitizing measures — always good — have been heightened to include additional hand sanitizer available for guest use, and sanitizing each conference room between in-person meetings. Our building’s frequent bathroom cleanings continue apace. The safety of guests and staff is our primary concern, and we encourage you to follow the recommended CDC guidelines.

Additionally, our updated website now has a unique feature to allow you to schedule a telephone conference at your convenience online. You can use that feature 24/7 wherever you live. Here’s how to book a call now. https://www.nancelawfirm.net/book-a-call/

Finally, as things get worse — and they will — we will offer appointments and family meetings, both in office and remotely, via Zoom meetings. (Sounds hard but it is not. If you’re reading this, you have a computer or iPhone, and you can meet us remotely!). You can join Zoom here now for free. https://zoom.us

Updates to come – follow along on our social channels for the latest information. We hope to “see” you soon!

Whitney Hendrix

Director of Client Services

How Can Long-Distance Caregivers Help Loved Ones?

Managing for an aging family member is never easy, and possible travel restrictions or hazards related to the Coronavirus make it even tougher, and more important. A recent article noted that long-distance caregivers have the same concerns and pressures as local caregivers, perhaps even more. They spend about twice as much on caregiving as people caring for a loved one nearby, because they’re more likely to need to hire help, take uncompensated time off work and pay for travel. A huge challenge for this group is just staying informed and assured that the person needing care is in good hands. As a result, long-distance caregivers must have good communication and a solid team on the ground. That team may include a local elder law attorney.

AARP’s recent article entitled “Long-Distance Caregiving: 5 Key Steps to Providing Care From Afar” provides us with five steps to staying informed and effective as a long-distance caregiver and thoughts for implementing the measures.

  1. Be sure you have access to information. Having a means of receiving good information and possessing legal authority to make financial and health-care decisions is critical for all primary caregivers, but it’s even greater for ones caring from a distance. Arrange as much as you can during an in-person visit. Consider booking a call with an elder law attorney when you are in town (or remotely, if advisable). The right legal documents can be critical. See https://www.nancelawfirm.net/what-estate-planning-documents-do-you-need/
  • Start the discussion on finances and map out with your loved one how to pay for health care and everyday expenses.
  • Ask whether your parent or other senior is able to sign the forms or make the calls necessary to give doctors, hospitals and insurers permission to share information with you or another trusted family member. This should include banks and utilities.
  • Be sure the senior has designated a durable power of attorney for health care and financial decisions.
  • Know what to do in an emergency, as far as access to the home by a neighbor, if needed.
  1. Create your on-the-ground support team. Don’t try to do it all, especially if your loved one has more serious or complicated health issues. In addition to healthcare professionals, ask friends, family and community groups to join a network of caregiving helpmates. Remember to add your loved one as part of the team.
  • Assign roles and tasks, that the members of the team are willing and able to do.
  • Create a list with contact info for everyone and keep it up to date.
  1. Consider hiring a reputable caregiving professional. They’re often called a geriatric care manager, aging life care manager, or eldercare navigator or coordinator. These professionals are frequently licensed nurses or social workers who can also be valuable mediators or sounding boards, when family members disagree on care decisions. Elder law attorneys may have good care managers to recommend.
  • Verify the person’s professional certifications, see how long the person has been in the field and request references.
  • Care managers can charge $50 to $200 an hour. Medicare doesn’t cover this service, nor do most health insurance plans. However, if you can handle it financially, an experienced manager may be able to save your family time, money and stress with even a short call.
  1. Find ways to communicate regularly with your local support group and loved one. You should leverage technology. With permission, place video monitors, wearable activity trackers, remote door locks to prevent wandering (if the care recipient has dementia) and even electronic pill dispensers that can tell you if someone has taken the prescribed medications.
  2. Leverage your visits. Nothing’s better than an in-person visit. When you can manage one, come with a list of things you need to know or discuss.
  • Interview possible home aides or house cleaners or meet with social workers or other professionals involved in your loved one’s care to discuss any concerns.
  • Look for signs of abuse, which means monitoring your senior’s checking account and see if there are any irregularities and look for red flags of physical or emotional mistreatment, like bruises, unexplained injuries, or a sudden change in personality. Note if your family member talks about a person you’ve never met who visits often and has been “very helpful.”

Although you may have several practical tasks to tick off your list, it’s important to spend quality time with your loved one. And seek the advice of a qualified elder law attorney, if you have any questions.

Reference: AARP (Oct. 30, 2019) “Long-Distance Caregiving: 5 Key Steps to Providing Care From Af

Together, but not married.

Estate Planning for Unmarried Couples

For some couples, getting married just doesn’t feel necessary. Maybe later. Maybe never.  But they are a couple. However, they don’t enjoy the automatic legal rights and protections that legally wed spouses do, especially when it comes to death. There are many spousal rights that come with a marriage certificate, reports CNBC in the article “Here’s what happens to your partner if you’re not married and you die.” Without the benefit of marriage, extra planning is necessary to protect each other.

Taxes are a non-starter. There’s no federal or state income tax form that will permit a non-married couple to file jointly. If one of the couple’s employers is the source of health insurance for both, the amount that the company contributes is taxable to the employee. A spouse doesn’t have to pay taxes on health insurance.

More importantly, however, is what happens when one of the partners dies or becomes incapacitated. A number of documents need to be created, so should one become incapacitated, the other is able to act on their behalf. Preparations also need to be made, so the surviving partner is protected and can manage the deceased’s estate.

In order to be prepared, an estate plan is necessary. Creating a plan for what happens to you and your estate is critical for unmarried couples who want their commitment to each other to be protected at death. The general default for a married couple is that everything goes to the surviving spouse. However, for unmarried couples, the default may be a sibling, children, parents or other relatives. It won’t be the unmarried partner.

This is especially true, if a person dies with no will. The courts in the state of residence will decide who gets what, depending upon the law of that state. If there are multiple heirs who have conflicting interests, it could become nasty—and expensive.

However, a will isn’t all that is needed. Not by a long shot.

Most tax-advantaged accounts—Roth IRAs, traditional IRAs, 401(k) plans, etc.—have beneficiaries named. That person receives the assets upon death of the owner. The same is true for investment accounts, annuities, life insurance and any financial product that has a beneficiary named. The beneficiary receives the asset, regardless of what is in the will. Therefore, checking beneficiaries need to be part of the estate plan.

Checking, savings and investment accounts that are in both partner’s names will become the property of the surviving person, but accounts with only one person’s name on them will not. A Transfer on Death (TOD) or Payable on Death (POD) designation should be added to any single-name accounts.

Unmarried couples who own a home together need to check how the deed is titled, regardless who is on the mortgage. The legal owner is the person whose name is on the deed. If the house is only in one person’s name, it won’t become part of the estate. Change the deed so both names are on the deed with rights of survivorship, so both are entitled to assume full ownership upon the death of the other.

To prepare for incapacity, an estate planning attorney can help create a durable power of attorney for health care, so partners will be able to make medical decisions on each other’s behalf. A living will should also be created for both people, which states wishes for end of life decisions. For financial matters, a durable power of attorney will allow each partner to have control over each other’s financial affairs.

It takes a little extra planning for unmarried couples, but the peace of mind that comes from knowing that you have prepared to care for each other, until death do you part, is priceless.

Reference: CNBC (Dec. 16, 2019) “Here’s what happens to your partner if you’re not married and you die”

 

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