Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

A Member of the Law Professor Blogs Network

Sunday, April 26, 2015

Ask Math Not Facts to Detect Cognitive Impairment Early

MathResearchers of dementia and cognitive impairment warn that many individuals can still recall common facts, such as the date or who the president is, in the early stages of impairment. However, losing ability to do simply math and understanding finances can come earlier in the development of diseases such as  Alzheimer's. Detecting declining ability to handle finances early can help protect older individuals from exploitation.

See Tara Siegel Bernard, As Cognition Slips, Financial Skills Are Often the First to Go, New York Times, Apr. 24, 2015.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

April 26, 2015 in Disability Planning - Health Care, Disability Planning - Property Management, Elder Law | Permalink | Comments (0) | TrackBack (0)

Thursday, April 23, 2015

Incapacity Planning

Healthcare proxySome of the lesser-known benefits of a well-crafted estate plan are the provisions providing for both management of assets and instructions for personal care in the event of incapacity.  Estate planning documents that anticipate incapacity enable named representatives to manage an individual’s assets, and direct how health care decisions will be made.  Without these documents, family members may have to petition a court to attain power to manage the assets or make health care decisions for one who is incapacitated. 

The first document necessary in planning for incapacity is the durable power of attorney.  This document survives incapacity and gives a designee the authority to act on one’s behalf with regard to financial affairs.  The durable power of attorney is valid once the testator signs it, so selection of designee is imperative.  The next set of documents concerns heath care; and includes a health care proxy, living will and HIPAA authorization.  A health care proxy will give a designee the power to make health care decisions on one’s behalf.  A living will or advance directive can provide directions to caregivers and loved ones with regard to care or end-of-life matters.  A HIPAA authorization allows doctors to disclose important health information to caregivers. 

See Planning for Incapacity re: Estate Planning, The National Law Review, Apr. 23, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

April 23, 2015 in Disability Planning - Health Care, Disability Planning - Property Management, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0) | TrackBack (0)

Saturday, April 18, 2015

Importance of Reviewing Powers of Attorney Gifting Provisions

EditPowers of Attorney are often drafted using boilerplate language. However, with the now $5.43 million Federal estate tax exemption, many Powers of Attorney may need to be revised in the way they address gifts made by agents. Prior to the increased exemption gifting by agents was more beneficial, but now it is likely not needed or can be exploited as has been seen by the increase in financial elder abuse. Even for individuals that still need estate tax considerations included in their Powers of Attorney, reviewing and individualizing the directions for how gifts should be made can be beneficial.

See Martin Shenkman, Do Powers of Attorney Need New Gifting Rules?, Financial Planning, Apr. 14, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

April 18, 2015 in Disability Planning - Property Management, Estate Planning - Generally | Permalink | Comments (0) | TrackBack (0)

Friday, April 3, 2015

Fox Drama Covers Serious Estate Planning Issues

TVThe popular drama-filled television show Empire just finished its first season and has been renewed for a second season on Fox. The show's plot includes deeply rooted estate planning themes. The show follows father and entertainment mogul Lucious Lyon as he faces a terminal illness and must begin succession planning for his business by choosing between his three sons.

See David H. Lenok, Empire: The Best Estate Planning Drama on TV, Wealth Management, Apr 2, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

April 3, 2015 in Disability Planning - Property Management, Estate Planning - Generally, Television | Permalink | Comments (0) | TrackBack (0)

Monday, March 30, 2015

Planning Ahead for Special Needs

Special needs 2

Planning for family members with special needs can be overwhelming, especially when so many decisions may have lifelong consequences.  Not only must parents untangle the intricacies associated with government programs, but they must also understand guardianships, legal documents and the like.  Below are some tips for families beginning to plan for individuals with special needs:

  • Getting Started.  When you need to budget for another person, saving for retirement becomes even more difficult.  You may need to take precautions that money set aside for your child will not be consumed by long-term care expenses for you or a spouse.  Many families supplement what Medicaid provides by putting money into a special needs trust, and those funds can be used to help pay for the individual’s expenses without jeopardizing government benefits. 
  • Utilize New Tools.  The ABLE or 529A account, is a tax-advantaged savings vehicle that make it much less costly to create a special needs trust.  These accounts are likely to be attractive for disabled people who work and want to save more than $2,000, or for families who need a place to deposit gifts or inheritances from family members.  Once the account exceeds $100,000, the individual’s benefits will be cut off, although Medicaid is not affected. 
  • Trusts.  While there are several types of special-needs trusts, “third party” trusts are frequently used by families who want to supplement what the disabled person receives through government-run programs.  The trusts can sit for years, families can add money over time, or they can fund them with life insurance and estate proceeds.  Pooled trusts are also an option for families with less money or little family to help oversee the process.
  • Guardians.  Families struggle when it comes to considering whom to appoint as a guardian to look after their child, as well as who will serve as a trustee to oversee any trust accounts.  Some experts suggest splitting roles to build in a system of checks and balances: Have a guardian who will advocate for the individual, and a separate trustee to handle the money.

See Tara Siegel Bernard, Tips for the Future Care of Disabled Family Members, The New York Times, March 27, 2015.

Special thanks to Matthew Bogin (Bogin Law) for bringing this article to my attention.

March 30, 2015 in Disability Planning - Health Care, Disability Planning - Property Management, Estate Planning - Generally, Guardianship, Non-Probate Assets, Trusts | Permalink | Comments (0) | TrackBack (0)

Monday, March 23, 2015

Tom Benson Texas Case Moved to Federal Court

Tom BensonThe Texas case involving Tom Benson has been removed from Bexar County probate court to a San Antonio federal district court on Benson's motion.

See David Hendricks, Benson Case Moved Out Of Bexar Probate Court, My San Antonio, March 20, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.


March 23, 2015 in Disability Planning - Property Management, Elder Law, Estate Planning - Generally, New Cases | Permalink | Comments (0) | TrackBack (0)

Thursday, March 19, 2015

Helping Clients With Long-Term Care Plans

Medical expensesLong-term care woes are rapidly escalating.  Rising medical costs, improved longevity and continued low interest rates are taking a toll on an industry many clients will rely on to take care of them on old age. 

Amidst these problems planners must evolve their own strategies on how to best help clients meet their future needs.  Below are some components an advisor should address to help clients create the best possible plan:

  • Home Front.  Home equity continues to be the most significant asset for a majority of older Americans.  Yet as clients begin aging, home maintenance becomes a burden and downsizing may not have much financial benefit.  Better ideas include renting in an area where there is good elder support, moving to a continuing care community, or living with family members. 
  • Default Care.  Identify potential caretakers and create agreements long before the need arises.  Financial planners can help families negotiate the best process. 
  • Too Much Stuff.  Create a plan as to how jewelry, collections, and other valuables should be insured and protected.  Discuss car ownership and a transportation plan before a client can become a danger to themselves or others.  If a client drives less than a couple thousand miles a year, paying someone else to drive may provide cost benefits. 
  • Quality of Life Choices.  Help clients become empowered patients by documenting acceptable quality of life measures, and sharing those decisions with medical providers and everyone else who has input on their care.  In doing so, the medical system will have a defined end point of when to move away from aggressive curative care to palliative care. 

See Carolyn McClanahan, Create a Long-Term Care Plan—Without Insurance, Financial Planning, March 18, 2015.

Special thanks to Jim Hillhouse (Professional Legal Marketing) for bringing this article to my attention.

March 19, 2015 in Disability Planning - Health Care, Disability Planning - Property Management, Elder Law, Estate Planning - Generally | Permalink | Comments (0) | TrackBack (0)

Friday, March 13, 2015

Court Blocks Conservator's Attempt to Create SNT


A California appeals court recently upheld a trial court’s denial of a conservator’s petition to establish a first-party special needs trust for a 66-year-old woman, because, under federal law trusts cannot be created for the benefit of people of individuals who are ages 65 and older. 

Elaine Abbott is a professional conservator who was in charge of managing Carla Horton’s estate.  When Ms. Horton was 66, Ms. Abbott petitioned the probate court to create a trust for Ms. Horton’s benefit.  When the probate court denied the request for the aforementioned reason, Ms. Abbott appealed.  When the appeals court asked Ms. Abbott why her appeal was not moot due to Ms. Horton’s age, Ms. Abbott submitted a brief proposing that the court create a pooled trust, because pooled trusts can be funded by beneficiaries of any age.  The court denied the appeal and required her to pay all costs and legal fees since the appeal did not benefit Ms. Horton.  Estate of Horton, Cal. Ct. App., No. B253487, Jan. 15, 2015.

See Conservator Fails in Attempt to Establish SNT for 66-Year-Old, Resourceful Law, 2015.

March 13, 2015 in Disability Planning - Property Management, Elder Law, Estate Administration, Estate Planning - Generally, Guardianship, Trusts | Permalink | Comments (0) | TrackBack (0)

Thursday, March 12, 2015

Article on Wealth Transmission System


Naomi Cahn (George Washington University Law School) and Amy Ziettlow (Institute of American Values) recently published an article entitled, ‘Making Things Fair’: An Empirical Study of How People Approach the Wealth Transmission System, Elder Law Journal, Vol. 22, No. 325 (2015); GWU Legal Studies Research Paper No. 2015-4; GWU Law School Public Law Research Paper No. 2015-4.  Provided below is the abstract from SSRN:

The wealth transmission process is of great concern to many senior citizens in the United States. The American wealth transmission process is designed to respect private ordering. It encourages planning as a means to formalize intent and ensure smoother property transfer at death. Most people do not plan, nor do they use, the formal probate system for distributing property, but there is little research on what the actual wealth transfer process looks like for the majority of Americans. This article challenges the contemporary trusts and estates canon by showing that the nuts and bolts of the inheritance process for many Americans takes place in a different universe outside of probate court, where the black-letter law is only a shadow. keepsakes and heirlooms assume outsized importance, and family dynamics drive outcomes. It is based on a first-ever empirical study of intergenerational care for Baby Boomers. This study shows that the formal laws of the inheritance system are largely irrelevant to how property is actually transferred at death. The contemporary trusts and estates canon focuses on the importance of planning for traditional forms of wealth in nuclear families, rather than wealth that has high emotional, but low financial, value. Alternative family structures and changing forms of wealth challenge this canon, uncovering serious shortcomings in existing means designed to encourage planning and minimize conflict. Instead, this study shows how the logic of "making things fair" has been structuring the way families navigated the distribution process and accessed the law. Consequently, this article recommends that law reform should be guided by the needs of contemporary families, where not only is wealth defined broadly but family too, through ties that are both formal and functional. This means establishing default rules that maximize planning while also protecting familial relationships.

March 12, 2015 in Articles, Disability Planning - Property Management, Elder Law, Estate Administration, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 10, 2015

Think Twice About A DIY Estate Plan

DIYWhile many of us are proudly “do-it-yourselfers,” when it comes to your estate plan, seeking professional advice is often the most prudent course of action. 

A basic estate plan comprises of three core documents: a will, durable power of attorney, and an advance directive.  These all serve vital roles in your estate plan, which is why everyone needs them.  Although you can create these documents yourself (perhaps the more economical solution), you must be careful as estate planning documents that are not properly executed can cause problems for heirs, potentially making the document null and void. 

Certain circumstances may warrant or even necessitate various types of trusts, and if you think you could benefit from one, getting advice from an estate planning attorney is highly recommended.  Furthermore, basic documents will likely not provide the necessary language to handle more complex situations, such as including children from a prior marriage, children with special needs or transferring a business ownership.  Also be aware that a DIY approach may not contain the most up-to-date information, since new legislation and case law is constantly renewed.  Paying for advice could save you and your loved ones added expenses and frustrations, allowing you to focus on other DIY tasks.

See Mark A. Hebert, Money Sense: Do-It-Yourself Estate Planning Has Potential Pitfalls, New Hampshire Union Leader, March 7, 2015.

March 10, 2015 in Disability Planning - Health Care, Disability Planning - Property Management, Estate Administration, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)