Archive for 2013
WASTED WEALTH: $40 MILLION AND NO WILL
Roman Blum died last year in New York at the age of 97 with $40 million worth of assets. At first glance, that sounds like a wonderful way to leave the world. However, Mr. Blum passed away without a will or any other indication of who he wanted to receive his fortune. He also was a Holocaust survivor, and it appears that his unique history died with him
Mr. Blum left behind enough assets to really make a difference in the world. If he had planned, he would have had many options to improve the lives of others by making charitable contributions or leaving money to specific individuals. Unfortunately, without a plan or any obvious heirs (Mr. Blum died without a spouse or children), the $40 million may end up going to the state of New York rather than to the causes or people Mr. Blum cared about.
Perhaps the most tragic part of Mr. Blum’s failure to plan is that he died without preserving his life wisdom. Mr. Blum’s friends and acquaintances gave the media a rough timeline of his life, but no one seemed to know his exact experience during the Holocaust. He earned his fortune buying and developing property, but it does not appear that he ever shared his secret to success.
If you know anyone who has wealth to share with the world, whether it is assets or life wisdom, encourage them to plan before it is too late. A counseling-oriented estate planning attorney can help to preserve their individual legacy and ensure their wealth passes according to their wishes and not the state’s.
For more on Mr. Blum, see: http://www.nytimes.com/2013/04/28/nyregion/holocaust-survivor-left-an-estate-worth-almost-40-million-but-no-heirs.html?pagewanted=all&_r=0
ESTATE PLANNING ISSUES FOR UNMARRIED AND SAME-SEX COUPLES
New state laws allowing same-sex marriage and two pending Supreme Court rulings on the subject have brought to mind the special estate planning issues faced by same-sex and other unmarried couples. Marriage comes with important legal rights and benefits that are not automatically provided to all romantic partners.
For example, the state of Florida has a default estate plan for every resident who dies without a will or trust. If you get married, this default plan is automatically adjusted; the primary beneficiary of your property changes immediately from your closest blood relatives to your new spouse. If you are unmarried, on the other hand, the default plan does not give your significant other any of your property, no matter how long or serious your relationship.
Another big area of concern is making sure your unmarried partner has access to you if you are hospitalized and that he or she can participate in the decision-making process if you are hurt or disabled. Again, the law does not give any automatic rights to couples unless they are married. This lack of rights can cause significant emotional distress when something happens to one partner and the other is left feeling helpless.
The good news is that the issues described above can be addressed through a comprehensive estate plan. A trust can give your unmarried partner the same benefits as, and potentially more control than, they would get as your spouse under Florida’s default estate plan. Ancillary planning documents such as powers of attorney and designations of health care surrogate will allow you to empower your significant other to make medical and financial decisions on your behalf. If you are interested in learning more about these documents, you are welcome to attend one of our Truth About Estate Planning workshops.
MAY IS ELDER LAW MONTH!!
May has been declared to be National Elder Law Month and Older Americans Month. We think that makes this the perfect time to discuss how we and other elder law attorneys can serve “older Americans” (defined as those who are at least 60 years of age).
What is Elder Law?
Elder law addresses the needs of the elderly, the disabled, and their families. This includes planning for future age- and disability-related issues, such as how to safely remain in the home or placement in a long-term care facility. Specifically, elder law attorneys help clients secure peace of mind through estate planning, disability planning, and planning involving government programs such as Medicaid and Veteran’s Administration benefits. We also handle situations where it either has become too late for planning (due to a disability or death), as is common in guardianship and probate cases, or when a plan is being challenged.
More than Documents and Litigation
Because of the many different government programs and legal options that may be available to clients, elder law attorneys take a comprehensive approach to planning. Every client will have a different situation, usually with multiple issues to be addressed and more than one set of laws and rules to consult.
As a result, elder law attorneys spend a significant amount of time with older individuals and discuss extremely personal preferences and fears. This creates an opportunity for us to be a resource to our clients. By getting to know other people in our community who provide services to older Americans, such as independent and assisted living facilities, home health care providers, hospice care providers, and even other attorneys, we can give our clients practical as well as legal guidance and counsel them every step of the way.
FIRM UPDATE: 2013 ANNUAL CLIENT MEETING
Our first Annual Client Meeting (ACM) in our new location was a huge success! The client families who attended enjoyed hors d’oeuvres, wine, and a tour of our new space. We did discuss business while sampling the food; for example, the major changes in estate tax law brought about by the American Taxpayer Relief Act of 2012. This new law was passed by Congress at the beginning of this year and will affect some of our clients’ estate plans.
The ACM is a key ingredient in our estate planning process. Every year, we meet with our client families as part of our formal estate plan maintenance program. We tell them about changes in the law and they tell us about changes in their lives. Annual Client Meetings help us do a better job and ensure that our clients have plans that work!
LAWYER’S BEHAVIOR AT TRIAL IS NOT EVIDENCE OF ELDER ABUSE
Here is an interesting case from California that caught our attention. An 83 year old man filed for a protective order against his 56 year old daughter because of alleged abusive treatment. In the court hearing over the matter, the daughter’s attorney’s confrontational cross-examinationof the elderly gentleman was found by the trial court to be consistent with the daughter’s desire to treat her father in such a fashion. He then granted a protective order which stated that the daughter could not contact, molest, attack, strike, threaten, assault or otherwise disturb the peace of her father. The daughter appealed the case arguing that her attorney’s behavior and her lack of response to it should not be used as evidence by the trial court. The appellate court agreed and said that the trial judge was wrong to base his decision on the lawyer’s conduct.
While this decision is good news for us lawyers, it does highlight the fact that we are too often aggressive and confrontational, particularly in guardianship, probate, and other elder law cases. It is important that all lawyers recognize when in the probate court that we are not trying high profile criminal or personal injury matters. We are involved in disputes among family members where emotions are already running high and we should avoid making matters worse. We can represent our clients effectively in elder law matters without being either abusive or confrontational.
GUN TRUSTS: ANOTHER FACET OF ESTATE PLANNING
We have been getting a lot of questions about “gun trusts” lately, especially with Congress and the media focused on potential gun control legislation. Holding firearms within trusts has become necessary and desirable due to the strict rules contained in the National Firearms Act (NFA) regarding certain types of firearms.
Firearms are truly a unique type of property; they can be very valuable, whether monetarily, sentimentally, or both. They are also dangerous, as recognized by the NFA. These characteristics of guns, as well as the strict regulations they may be subject to, mean that it is essential to properly plan for their ownership and transfer.
A “gun trust” can, if done correctly, address the issues of owning firearms during your life and passing them on to your loved ones after you are gone. However, just like other types of trusts, you should beware the inexpensive, “bare bones” version from an attorney who asks you only a few questions and just fills in a form.
The actual language of the trust is very important for compliance with the NFA. Also, proper counseling is necessary so that you can consider and discuss topics such as who should act as successor trustee (he or she will have physical possession of your firearms) and whether you should require your beneficiaries (who will use or receive the firearms) to get training beforehand.
Because we believe in comprehensive estate planning, we are happy to create trusts which hold firearms for our clients. However, we will only do “gun trusts” as part of the Cramer Law Center process to ensure that we are able to provide proper counseling and draft a trust that will work for you and your family.
We have been getting a lot of questions about “gun trusts” lately, especially with Congress and the media focused on potential gun control legislation. Holding firearms within trusts has become necessary and desirable due to the strict rules contained in the National Firearms Act (NFA) regarding certain types of firearms.
Firearms are truly a unique type of property; they can be very valuable, whether monetarily, sentimentally, or both. They are also dangerous, as recognized by the NFA. These characteristics of guns, as well as the strict regulations they may be subject to, mean that it is essential to properly plan for their ownership and transfer.
A “gun trust” can, if done correctly, address the issues of owning firearms during your life and passing them on to your loved ones after you are gone. However, just like other types of trusts, you should beware the inexpensive, “bare bones” version from an attorney who asks you only a few questions and just fills in a form.
The actual language of the trust is very important for compliance with the NFA. Also, proper counseling is necessary so that you can consider and discuss topics such as who should act as successor trustee (he or she will have physical possession of your firearms) and whether you should require your beneficiaries (who will use or receive the firearms) to get training beforehand.
Because we believe in comprehensive estate planning, we are happy to create trusts which hold firearms for our clients. However, we will only do “gun trusts” as part of the Cramer Law Center process to ensure that we are able to provide proper counseling and draft a trust that will work for you and your family.
DPOA DANGER: YOU CAN’T EVEN TRUST YOUR GRANDCHILDREN
A general durable power of attorney (“DPOA”) is a document that gives a person you name (your “agent”) the authority to manage your affairs and do almost anything you could do personally. Your agent is supposed to act for your benefit, doing things such as using your money to pay your bills. Unfortunately, it is easy for an untrustworthy agent to abuse the power you give him under a DPOA.
A recent news story from Colorado is a perfect illustration of a DPOA gone wrong. An elderly couple gave their grandson, a married adult man, a DPOA. They had moved into an assisted living facility and presumably just wanted someone they trusted to help out with their finances. We see this all the time with our aging clients.
Although the couple’s grandson may have been their most trusted relative, he did not deserve their confidence. The grandson and his wife, in just eighteen months, spent all of the couple’s money and ran up bills on their credit cards. They used the stolen funds, not to take care of the couple, but to pay for their own living expenses, travel, and shopping.
Similar abuses of authority are possible in Florida due to the lack of supervision over agents acting under a DPOA. Unlike the trustee of a trust or the guardian of an incapacitated person, an agent under a DPOA does not have to account to anyone. This creates an opportunity for agents to exploit their often elderly and usually unaware victims.
The DPOA is not entirely evil; it can be useful as part of a comprehensive estate and disability plan. However, we at Cramer Law Center do not let our clients sign a DPOA without proper consideration and counseling. We may also recommend safeguards, such as holding the DPOA in escrow until it is needed, to deter potential abuse.
ANOTHER ESTATE PLANNING HORROR STORY FROM THE REAL WORLD – SECOND MARRIAGE MISTAKE
We recently had a client inquire about challenging his stepmother’s will. Our first thought, and perhaps yours, was that the desire to challenge came from a history of animosity between the client and his stepparent, something we see all too frequently. However, in this case, the client was actually fond of his stepmother – that is, until she died with a will that left all of his father’s assets, including the family home, to her children.
Our client’s father (we’ll call him “Bill”) made a classic second marriage planning mistake: his only estate plan was a simple “I Love You” Will that left everything to his second wife, if she survived him, and then to his children. Bill’s intent, according to our client, was to take care of his wife first, and then his kids. His plan may have worked in a first marriage where Bill and his wife only had children with each other (but even then, only if the wife did not remarry before her death and had an identical will).
However, what actually happened is that when Bill died before his second wife, she received his assets with no strings attached. She could have made an estate plan that included Bill’s children as well as her own, but she was under no legal obligation to do so. Therefore, we had to advise our client that a will challenge would be fruitless because he and his siblings had no legal right to their family home or to any of the other property their stepmother received from their father.
We were truly sorry to have to deliver such bad news to our client. But what makes it worse is that Bill easily could have achieved his true objective of taking care of his wife for the rest of her life, and then leaving an inheritance for his children, with proper trust planning. Unfortunately, in second marriage situations, what an “I Love You” Will really says is: “I Don’t Care About My Kids.”
Where Will I Live If I Become Disabled?
With the costs of both long-term care and long-term care insurance increasing, we are seeing a corresponding uptick in concern and questions from our clients about how and where they will live if they lose the ability to care for themselves. The good news is that there are ample housing options that have been designed to match differing care needs and price points.
Nursing Homes
Nursing homes seem to be the first thing our clients think of when we discuss long-term care. Often, the clients will express a negative perception of these facilities and a desire to avoid them. Nursing homes are designed to provide a high level of care to residents who need medical as well as daily living assistance. As a result, they are generally more expensive than other housing facilities.
Assisted and Independent Living Facilities
Assisted and Independent Living Facilities are designed for older individuals who need or desire some level of assistance with their day-to-day activities but do not require skilled nursing care. These facilities usually offer a range of services and activities, such as medication management, meal preparation, and community excursions. The cost of assisted or independent living usually depends on which services are included by the facility or selected by the resident.
Continuing Care Retirement Communities
A continuing care retirement community is a place that provides independent living, assisted living, and nursing home care all at one site. This allows residents to increase their level of care (and monthly payment) as their care needs grow. These communities can be a good solution for a married couple where one of the spouses needs significantly more care than the other.
In-Home Care
Staying at home and having caregivers come to them is the most desired care option among our clients. There are a variety of in-home care companies, just as there are different types of long-term care facilities, based on the level of care needed. In-home care can be a cost-effective solution when an older person just needs assistance with tasks such as cooking and bathing, but can become cost-prohibitive when skilled nursing care or 24-hour supervision is necessary.
At Cramer Law Center, our trust planning process includes comprehensive planning for possible disability. We help you provide instructions on how you may be declared disabled, and by whom, and on how you would like to be cared for during a disability (including your housing option preferences). We also discuss planning for payment of possible long-term care expenses with you and your trusted advisors.
BIG NEWS !!! WE’RE MOVING!
Cramer Law Center is moving! We have outgrown our Baymeadows location, but we’re remaining in the Mandarin area. Starting April 1, 2013 (no foolin!), you can find us at CONCORDE I, 3030 Hartley Road, Suite 290. We’ll be in the Concorde complex, which is behind the Wells Fargo Bank, just north of I-295 and San Jose Boulevard. The new office will be located on the opposite side of San Jose Boulevard from the Whole Foods Market. Even though we have to pack and unpack, we’re excited about the move. Not only will we have our own larger space, but we’ll also have access to a 30-seat training facility in the adjacent building to use for our workshops. The move is just in time, because we had a record crowd at our March “Truth About Estate Planning” workshop! Hopefully, we won’t have to turn away anyone in the future.
While we’re talking about us, here are some quick tidbits about our team: Jeff recently had a grandson and was excited to visit him in Santa Fe, New Mexico; Amelia has returned from Indianapolis completing the first phase of her cutting-edge estate planning training with the National Network of Estate Planning Attorneys; Valentina was a pace setter in the recent 26.2 With Donna National Marathon for Breast Cancer; and Debbie was the second runner up in Carriage Club’s 2013 Annual Chili Cook-Off!
To see photographs of us in our new office space and stay up-to-date on all of the activities at Cramer Law Center, please “Like” our Facebook Page at facebook.com/cramerlaw.
Cramer Law Center offers full, flat fee estate planning services including wills, trusts, durable powers of attorney, health care surrogate designations, living wills, designations of preneed guardian, and more.
The next “Truth About Estate Planning” workshop will be held at the Cramer Law Center Concorde 1, 3030 Hartley Road, Suite 290, Jacksonville, Florida 32257 on April 4, 2013 at 10:45 a.m. Please call us at (904) 448-9978 to reserve your seat.
