Capital District - NY Estate & Elder Law

Make Sure the Right People Have Access to Your Digital Accounts

 

 

The world is changing rapidly, thanks to fast-moving advances in technology, including the creation of digital assets. That means your estate plan may well need an update, according to Financial Advisor in “Unlocking Clients’ Digital Lives.”

As it turns out, if no one can access your digital assets, including accounts, many could be lost, stolen by a hacker or deleted.

Forty-one states and the U.S. Virgin Islands have passed laws that allow a financial planner or other fiduciary to access digital assets upon the death of a client, and four other states plus the District of Columbia are considering similar legislation.

In Missouri, the Fiduciary Access to Digital Assets Act allows a fiduciary to be granted access to a person’s electronic records or digital assets in a will, trust, power of attorney or another document.

The way we live our personal lives and the way we conduct our personal business and financial matters have changed, so we must address digital assets in our estate planning to reflect these changes.

Challenges are created if those digital assets are not addressed in the estate plan. Striking a balance between privacy rights and the need to settle an estate, can become an expensive and time-consuming issue. One family had to bring a lawsuit to access the emails of their son, a Marine who was killed while serving our country.

If you manage your bill paying and investments online, someone will need to be able to control bill payments, especially if they are on an autopayment schedule.

Start by preparing a complete inventory of all digital assets, including a description of each one and how it is accessed with names, passwords and security questions. Find out what each online platform requires, if a fiduciary or executor needs to access those accounts. Each platform, like each financial institution, has their own forms and procedures.

This information should be stored in a secure place. Some people prefer a password-protected digital location.

An estate planning attorney can help you create or update your estate plan that fits your unique circumstances and may include your digital assets.

Reference: Financial Advisor (Aug. 21, 2018) “Unlocking Clients’ Digital Lives”

 

Long Life? Expect Some Challenges along the Way

 

The life expectancy for Americans is getting longer and longer, with the concept that the longer you live the more likely you’ll have an even longer life span, according to Kiplinger, in “Are You Ready for Longevity? 4 Steps to Take Now.” 

Given the happy fact that you should expect to live a long time, what can you do to protect yourself and your family? Here are four steps:

Have a plan for long-term plan. For a married couple, it’s likely that one of the two will end up in a nursing home. Plan for how you’ll manage to pay for that, long before you’ll need it. If you can purchase a long-term care insurance policy, while you are still healthy enough to qualify, you won’t need to use up all the household’s money to pay for the care. Long-term care insurance usually pays for both skilled nursing home care and in-home health care aides.

Traditional long-term care policies can be expensive. However, insurance companies have created hybrid policies that combine long-term care benefits with life insurance. If you don’t use the long-term benefits, your loved ones receive the life insurance proceeds upon your death. That takes a way the worry that you will pay premiums and get nothing back.

Plan for incapacity. You’ll need to have a medical advance directive, including a health care proxy and health care powers of attorney, so you can name another person to make your decisions when you are no longer able to do so. Do not assume that because you are married, your spouse will be legally able to make those decisions.

If you become incompetent and don’t have a medical advance directive in place, your family will need to go to court to get legal authority to make those decisions. This is a guardianship proceeding, which is expensive, time-consuming and stressful.

The same holds true for financial decisions. You’ll want a power of attorney, so someone else can sign on your behalf and access your accounts. This should be a trusted individual who will look out for you and your family.

If you die and assets are solely in your name, your family will need to go to court before they can access any of your assets. This is a process known as probate. If you have an estate plan in place, your plan should include having some accounts that are POD or Payable on Death, so your loved ones are not left without assets. Your estate planning attorney will recommend the right planning tools, so that your family is protected.

Finally, do your tax planning as part of your estate plan. You likely won’t be paying federal estate tax.  However, there is a good chance that your state has an estate tax or an inheritance tax.

Reference: Kiplinger (August 13, 2018) “Are You Ready for Longevity? 4 Steps to Take Now”

 

Have Young Children? Estate Plan Is a Priority

 

 

 

Many young families with small children do not have estate planning at the top of their list. However, it really should be a top priority, according to The Daily Sentinel’s in “What is missing from your estate plan?”

Some information in estate planning that should be known is a last will and testament. It is the document which parents need to legally nominate guardians to rear their children, if orphaned. While some people name one person to rear the children and handle the money, it’s a good idea to separate the two roles.

Without these instructions in a will, those left behind can have very different ideas about where the children should live and who should care for them. If the two parent’s families have very strong opinions, suddenly both families have hard choices to make about what will happen to the children.

No parent wants to leave a legacy of court battles and family division.  However, that’s what is likely to happen without a will.

There are other issues that estate plans address while you are alive.  It is also necessary to plan for incapacity. A living will, also known as an “advance directive,” is important because it helps pre-answer questions, regarding what treatment and care you would want if unable to speak for yourself. Do you want to be kept alive by artificial means? You do not want your loved ones making this decision during a time of great emotional stress, so this is an important document to have in your estate plan.

Finally, your estate plan should include a medical durable power of attorney to deal with all other medical decisions other than end of life. Without it, if you are not near death but not able to share your opinions about your care, your family and your medical providers are placed in a difficult position. In contrast, those who care enough about their family designate an agent and ensure that their wishes are made legally binding.

The big question everyone must face is “When should I start working on my estate plan?” If the answer is “Later,” then the real answer is “No time soon.” For young parents, that puts your minor children in a bad position, where a court may make the decision about who will rear them and how their lives will go on after you are gone.

An estate planning attorney can advise you in creating an estate plan that fits your unique circumstances, including families with young children.

Resource: The Daily Sentinel (Aug. 12, 2018) “What is missing from your estate plan?”

 

 

Children Can Contest Glen Campbell’s Will

 

Three of Glen Campbell’s children, who were intentionally left out of his will, have been given the right to contest the will by a judge, according to Wealth Management.com in “Glen Campbell’s Kids Come After the Rhinestone Cowboy’s Estate.”

Campbell, who recently passed away, left two wills from 2001 and 2006. The 2006 will names Campbell’s fourth wife Kimberly, who is the executor of the estate, and five of Campbell’s other children as his beneficiaries. Campbell went public with his Alzheimer’s diagnosis in 2011.  However, it’s not known how far back his illness began. The legal burden facing his children: prove that he lacked the needed capacity to execute both wills.

If the will is deemed invalid because of lack of capacity or undue influence, the immediately preceding will is resurrected, said one estate planning attorney who is not affiliated with the case. The previous will probably disinherited them also, which is why they must prove the invalidity of both wills.

Kimberly has told a local newspaper that she would not challenge the kid’s right to contest the wills and the judge’s decision noted the lack of opposition. She has also filed a claim seeking reimbursement from the estate for more than $500,000 to cover the cost of his medical care.

It was also reported that one of his daughters, Debbie Campbell-Cloyd, has filed for a complete accounting of all payments made by the estate, as well as payments to and from a previously undisclosed bank account. She alleges that royalties that should have been deposited into an account controlled by Campbell’s estate, were instead deposited into this account, which is now controlled by Kimberly. The singer’s former manager has power of attorney over the account.

An estate planning attorney can advise you in creating an estate plan that fits your unique circumstances and may include a blended family.

Resource: Wealth Management.com (Aug. 2, 2018) “Glen Campbell’s Kids Come After the Rhinestone Cowboy’s Estate”

 

 

Anthony Bourdain’s Estate Plan Goes Public

 

There is considerable interest in the estate of celebrity Anthony Bourdain and it is getting even more interesting, according to Forbes in “How Anthony Bourdain’s Estate Plan Reflected the Two Most Important Parts of His Life.”

The reports that his net worth was only $1.2 million grabbed a lot of attention. It shouldn’t have surprised anyone, because Bourdain regularly said that until his 40s, he lived paycheck-to-paycheck. What’s really interesting from the estate planning perspective, is how he expressed his wishes in his will. The details became public, because it was probated.

Bourdain made provisions for his only child, who will inherit the bulk of his wealth. He also seemed to have been influenced by the enormous amount of travel his career required. What is interesting is that he passed his frequent flyer miles to his estranged wife “to dispose of, in accordance to what she believes to be his wishes.”

Those who travel often and have large frequent flier miles, award points and perks, often overlook them as part of their estate plan. They are often valuable and should be addressed in estate planning.

However, passing along airline points is not as easy as filling out a beneficiary form. Each airline has their own policies so you may have to fill out a form for each one. Loyalty programs are basically contracts with a company and you’ll need to read the fine print, since not all airlines allow their points to be assigned. The selection of beneficiaries also may be limited by the airline.

Bourdain’s very public profile makes it unlikely any airline would refuse to honor his request to transfer those points. Because he carefully documented his desire to leave his frequent flier miles to a specific beneficiary, it’s even more likely his points will transfer without too much fuss.

Reference: Forbes (July 6, 2018) , “How Anthony Bourdain’s Estate Plan Reflected The Two Most Important Parts of His Life.”

 

Estate Planning? Consider Family Dynamics

 

A group of professionals including estate planning attorneys, trust officers, accountants, charitable giving professionals, insurance advisors, elder law attorneys and nonprofit advisors recently attended a conference on estate planning and a survey by TD Wealth revealed that the major professional concern that kept them awake at night was family conflict, according to WealthManagement.com, in “Family Conflict Tops the List of Estate Planning Challenges in 2018.”

The article says that 44% of all planning professions consider family conflict more of a threat to estate planning than tax reform (25%) and market volatility (12%). That’s no small number and one that should be considered, while creating or revising an estate plan.

One reason for these results is that the response to the Tax Cuts and Jobs Act has received mixed reactions from estate planning attorneys and financial professionals. Some believe it may help their clients, while about a third of those queried in the TD Wealth survey aren’t sure. Only 16% feel the tax reform will have a negative impact on their clients.

Almost 75% of those taking part in the survey felt that clients who do benefit, will do so because of wealth transfer tax changes. About a third expect that clients will see the biggest benefits from new estate tax laws, followed closely by generation-skipping tax and gift tax updates.

What is the biggest challenge that people face when addressing their estate plan, according to this survey? It is naming guardians for minor children and beneficiary designations.

An estate planning attorney can advise you in creating an estate plan that fits your unique circumstances and may include dealing with potential family conflicts.

Reference: WealthManagement.com (March 28, 2018) “Family Conflict Tops the List of Estate Planning Challenges in 2018”

 

 

Revisiting Estate Plan a Good Idea … Especially Now

 

If you have not already reviewed your estate plan and taken the new tax laws into consideration, now is the time to do so, according to Reuter’s article “Your estate plan needs an update even if it is new.” Many of the provisions end in 2026. Unless you can predict with great accuracy when you will pass, you need to update your estate plan.

Even though the exemption for the federal estate tax has doubled to $22 million for couples, one of the important parts of estate planning has to do with your financial well-being, while you are alive: power of attorney forms and healthcare proxies, in case you are unable to make decisions on your own.

You also should make sure that your beneficiary designations are up-to-date, especially on life insurance policies and 401(k)s from previous employers.

The central focus of estate planning is keeping control over your assets, even after you die. You might want your responsible younger daughter to be in charge of your estate and not your older son. You may also want to skip a generation and ensure that your wealth passes to grandchildren and not your children at all.

If your family includes a special needs individual, you’ll want to make sure you have made provisions for their future with a Special Needs Trust (SNT).

Many families who find themselves dealing with Alzheimer’s disease, drug or alcohol addiction or troubled marriages, use trusts in their estate planning to protect their loved ones and control the distribution of assets.

Trusts are also used for families who wish to keep their assets private and out of probate, where information about the family’s assets are public documents. Property that is not jointly owned or set to transfer directly to a beneficiary, can end up being part of the probate process.

Finally, even with the doubling of the estate tax limit, charitable giving still has a role to play in estate planning. By leaving a substantial IRA to charity through a trust, you can avoid the taxes heirs would pay when they liquidate the account. You can also give appreciated stock to a charity through a donor advised fund and bypass capital gains taxes.

An estate planning attorney can advise you in taking a fresh look at your estate plan and making any adjustments necessary to deal with the new tax laws.

Reference: Reuters (Jan. 18, 2018) “Your estate plan needs an update, even if it is new”

 

Transferring Property Can Be a Challenge

 

Ownership of property must be traced from one owner to another. However, when someone passes away, things change. There is now property that needs to change ownership. That creates the need for a lot of paperwork that needs to be done at once, according to U.S. News & World Report in "How to Deal With the Paperwork Scramble After a Spouse Dies."

It is easy to get overwhelmed and make costly mistakes when there is that much paperwork to fill out and file in such a short period of time. Those mistakes require even more paperwork and time to fix. People who are grieving and who do not know all the things that need to be done, make these mistakes all the time.

An estate planning attorney can advise you on creating an estate plan that fits your unique circumstances and may include a transfer of property.

Reference: U.S. News & World Report (June 19, 2018) "How to Deal With the Paperwork Scramble After a Spouse Dies."

 

You Can’t Find the Will…What Then Do You Do?

 

 

If a parent passes away and didn’t leave a will or you can’t locate one, things do not have to be too difficult. There are a few steps people need to take, if they find themselves in this situation, according to Forbes in "Your Parent Didn't Have a Will: What Should You Do Now?"

Those steps include:

• First check to see if your parent had a safety deposit box. Your parent might have created a will and put it in their safety deposit box. It is very common for people to leave their wills there. It can be difficult to gain access to these boxes, but it is possible.
• Search around the house for a will. Check any place your parent put any important financial or legal information. You might find a will stuffed away in some old file folder at the back of a drawer.
• While you are doing this, gather all of the information that you can find about your parent's finances. This information will help you later, so you might as well get it while you are searching for the will.
• Hire an estate attorney to help you. The attorney can assist with the probate process and make things much easier on you.

Reference: Forbes (June 4, 2018) "Your Parent Didn't Have a Will: What Should You Do Now?"

 

 

Michael Jackson Estate Files Another Lawsuit

 

The Walt Disney Company is being sued by the Michael Jackson estate, over a documentary that includes footage of his two children, plus short clips of two of his songs. Disney claims it did not need permission because it is a documentary, according to TMZ in "Michael Jackson Estate Sues The Walt Disney Co. You've Got Balls For Exploiting MJ's Kids!!"

The estate does have a duty to protect any copyrights entrusted to it but is has filed many lawsuits over the years and remains in litigation. As a general rule, if someone were to make a movie and use an entire Michael Jackson song in it, then the estate would need to file a lawsuit, if the song had been used without permission. However, in this case the estate might be a little overzealous.

Copyright does allow for the use of material without permission, if that use falls under the fair use doctrine. Doctrine normally does allow for short clips of material to be used and more material can be used, if it is done for educational purposes.

Reference: TMZ (May 30, 2018) "Michael Jackson Estate Sues The Walt Disney Co. You've Got Balls For Exploiting MJ's Kids!!"