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Estate Planning

Clear Counsel Law Group / Estate Planning

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Estate Planning: Power of Attorney

Assigning power of attorney is a major part of estate planning, and one that you should always make sure you have in place early on. While most people never plan on having someone else make decisions for them, there is no way of knowing what may happen in the future. Between accidents, serious illness, and other factors, it is in your and your family’s best interest to assign power of attorney ahead of time.

What is a Power of Attorney?

A power of attorney is someone that you name to make certain decisions for you if you become incapacitated or unable to properly take care of important decisions. Laws concerning power of attorney assignment vary from one state to another, so it is important that you check with a lawyer or government agency to ensure you follow the proper steps. There are also state-specific regulations that govern who may or may not be given power of attorney.

Decisions a Power of Attorney Can Make

It is up to you to decide what decisions your power of attorney will be able to handle on your behalf. You also have the right to assign different people to specific areas. The most common decisions that are assigned are:

• Decisions relating to your finances.
• Medical decisions, including whether to start, stop, or withhold certain treatments and services. Many choose a separate person or persons to help with making these choices, or you can assign one power of attorney for all decisions.
• Making gifts on your behalf.
• Recommending a guardian for your children.

Who Can Be Given Power of Attorney?

You can assign power of attorney, or attorney-in-fact, to nearly anyone you choose, but it is often reserved for spouses, adult children, and other trusted individuals. Whomever you choose should be someone you trust to act responsibly on your behalf, and make decisions he or she honestly believes you would make for yourself, if possible. You can choose to name different individuals for different aspects, such as one for finances and another for health care decisions. The choice is up to you, but you should also speak to the person in question to make sure he or she is comfortable handling the responsibility.

What Should be Included in the Document?

When preparing a power of attorney, you should make very clear what the person you are assigning will be able to control or make decisions about on your behalf. You should also clearly set limits for spending and other financial decisions, as well as requiring documentation of all activities performed for you. You will also need to consider whether others will be unhappy with your decision. If you believe this is a possibility, you can have witnesses on hand, or request that an attorney or physician write a statement stating that you were of sound mind when the decision was made.

A power of attorney is an important part of estate planning. You should always discuss your intentions with an estate planning lawyer to make sure you are following the laws and requirements in your state.

Estate Planning - 03/10/2015

Estate Planning for Blended Families and Single Individuals

The dynamics of families have changed over the years and become increasingly varied. This can make planning for the future a difficult prospect, with many intricacies and factors that must be considered to make sure that all your wishes are honored and your estate is handled properly.

Estate Planning for Blended Families

Blended families are very common nowadays, with 42% of adults having some type of step-relationship in the United States. Blended families are composed of divorced, widowed, or remarried individuals and their family members. Estate planning for blended families can be complicated and requires special attention.

It is easy to make mistakes when doing estate planning for a blended family, thus the need to hire the services of a qualified estate planning attorney to make sure all documents are correct. It is also possible that spouses and former spouses might disagree on how the wealth should be distributed, who will care for children in case a parent dies, which assets would be passed along to whom, etc.

Some of the most important questions to ask before estate planning are:

What would happen when you pass away?
Who would make medical and other decisions for you if you weren’t able to?
How will your children be provided for?
Who will be the guardian of the children in case you die?
How will your spouse be provided for?
Will you distribute any of your wealth to former spouses?
If your spouse and yourself cannot agree, will you need two separate attorneys?
Do you have a prenuptial agreement to take into consideration in your planning?

Once you come up with a decision of what you would like to happen in the event of your death or major disability, the next step is to contact a lawyer to structure your plan and put everything on paper. While there are many free estate-planning services online, they are not prepared to handle blended family situations, thus it’s important to seek proper counsel in this regard.

Properly setup estate plans can be expensive. However, they can save you a ton on money down the road if you compare costs versus benefits. Not to mention, you will get peace of mind to know that your wishes will be followed when you pass away.

Estate Planning for Single Individuals

There are more single people today than ever before. According to the United States census, nearly 50% of all Americans live singly, whether they have been divorced, widowed, or never been married before.

A lot of singles do not realize the importance of estate planning, because they do not have any dependents. However, single people also face the same issues married people do in regards to the planning of their wealth distribution once they pass away. Singles also face some special situations, such as to whom their wealth will be distributed if they have no living relatives, for example. Also, in case of a coma or a health situation where the single person is unable to make decisions for himself, who will make those decisions? Questions like these need to be considered, and careful thought needs to be given to estate planning, even for singles.

Estate Planning - 03/09/2015

Common Estate Planning Mistakes and How to Avoid Them

No matter how old or young you are, and no matter how much wealth you have, estate planning is something that should be on your radar. Obviously, your circumstances will determine to what extent you need to plan for your demise, but the unexpected can always happen, and it’s good to have a solid plan for your assets in place when it does. In our opinion, the biggest estate planning mistake that you can make is not having an estate plan at all. But, here are a few more:

Mistake #1: Not Taking Advantage of a Life Insurance Trust

Life insurance trusts are something that people all too often overlook, and it’s to the financial detriment of their life insurance policies’ beneficiaries. If not protected by a trust, a life insurance policy can become subject to onerous estate taxes once it is paid out. Make sure that you consult a qualified estate planning attorney, who can help you set up a life insurance trust that will ensure your life insurance policy is able to pay out as much as possible to the people who will need it.

Mistake #2: Not Keeping Your Will Current

At least every year or so, you should take the time to review the last will and testament you have in place. Things change all the time, and you want your will to reflect any changes that have taken place in your family. This can include adding or subtracting beneficiaries, as well as adjusting how assets are divvied out, based upon changes to your own financial situation. The last thing you should want for your beneficiaries is to leave behind an outdated will that has the potential to create a fractious situation following your demise.

Mistake #3: Not Having a Living Will

Anything can and will happen in this life, and sometimes our exit from the world is not what we would have planned. If you find yourself terminally injured and in need of life-sustaining care, then having a living will is crucial. This legal document defines what kinds of life-sustaining treatment you’re open to receiving and when it is appropriate to pull the plug. Also, this living will should grant someone with healthcare power of attorney or general power of attorney. This is necessary in the event that you are incapacitated and need someone to make important medical decisions for you. If you have a designated general power of attorney, they can also make important financial, business and personal decisions.

Mistake #4: Picking a Poor Executor

Most often, people will name an immediate relative as the executor of their estate. While it seems an obvious decision to make, it requires some thought. Can you confidently say that the person you’ve chosen will act ethically and expeditiously on your behalf? If not, then it could make sense to select an executor for your estate who is not directly affected by it. In some cases, individuals elect to have an estate planning lawyer act as the executor of their estates, knowing that these individuals will be able to objectively handle any confusion or disagreements surrounding the will’s terms.

The Biggest Mistake

Of all the mistakes you can possibly make, the biggest one is not retaining the services of an experienced estate planning attorney. So, if you’re serious about securing your family’s wealth, make sure that you get in touch with one of the qualified estate planning attorneys in our office today!

Estate Planning - 03/05/2015

Estate Planning: What You Need to Know

Estate planning is the process of setting up the distribution of a person’s assets. It involves all the documents that rule a person’s assets, including, but not limited to, trusts and wills. Estate plans also lay out the management, distribution, and protection of such assets. In other words, when a person passes away, the estate plan ensures that a person’s wishes are implemented.

Who Needs Estate Planning?

The future is unknown for everyone. While a person may be living one minute, there’s no guarantee that he or she will be living the next minute. This is why it’s so important to plan for the future and to protect your loved ones financially, making sure your assets go to the right hands, per your wishes. Sadly, most people do not think of death as a possibility in the near future and thus do not plan ahead.

Others might not even be aware of their assets and do not see the need to get an estate plan. Almost all people have some kind of estate: a house, a business, a life insurance policy, an employee benefits package, etc. Estate plans are not only for asset distribution but also for stating what would happen if you become disabled.

Benefits of an Estate Plan

Estate plans are hugely important and everyone should have one. As stated above, an estate plan will clearly state how your assets will be managed in the event of your death, as well as what type of healthcare you’ll want should you become incapacitated. In an estate plan, you can be as specific as you want to be about whom you’d like to care for you and who will be the beneficiaries of the wealth you leave behind.

Distribution of Property Using a Will

A will is a document that lays out your property distribution plan upon your death. It also includes the transfer of such properties from your name to the name of the person or institution of your choice. A will comes into effect only upon someone’s death. As soon as someone with a will passes away, the will is admitted to the probate court system. There’s also what’s called a living will, which is a will that contains instructions about your healthcare wishes in the event of becoming disabled.

Durable Power of Attorney for Healthcare and Property

This document assigns the person of your choice to decide your healthcare treatment in the event that you are unable to approve the care yourself. Another form of durable power of attorney is the Durable Power of Attorney for Property, in which the person you have appointed gets to make financial decisions for you in the event of permanent disability.

Living Trusts

Unlike a living will, a living trust is revocable, which means the person with the living trust remains in control of his wealth. Living trusts are used to assign a trustee to follow the instructions within the trust, but the person with the living trust can change the document at any time.

It’s never too late to start your estate planning. Contact a qualified estate planning attorney to set up your estate plan and protect your assets immediately.

Estate Planning - 03/04/2015

Important Facts About Living Wills and Power of Attorney in the State of Nevada

In the State of Nevada, it is relatively easy to establish a living will and power of attorney, especially as compared to other states. The forms that any individual needs in order to establish these legal documents are readily available from the state. While this means that it’s possible for an individual to handle the production of these legal agreements for themselves, it is always advisable that this be done under the supervision of a lawyer. This is especially true if the individual in question has highly specific requests for their living will, or if that person has a high net worth.

In order to understand how living wills and power of attorney work within the state of Nevada, we thought it would be useful to share some facts about them.

Who Can Have Healthcare Power of Attorney?

While you might think that you can grant healthcare power of attorney to anyone, this is not always the case. Most notably, healthcare providers and those who are employed at or operate a health care facility cannot be granted healthcare power of attorney. The only exception to this is when an individual’s spouse, next of kin, or guardian fills one of these roles.

How Can I Establish a Living Will?

Provided your needs are not overly complex, it’s possible to draft a living will yourself in the state of Nevada. However, this is usually not advised, and it is suggested that both the living will and the document granting power of attorney be drafted by or under the supervision of a qualified attorney. The reason for this is simple. If your living will is unclear in certain parts or neglects to address certain circumstances, then whoever you’ve given power of attorney to will be in the unenviable position of guessing what your wishes might have been. Moreover, there may be other issues that need to be addressed alongside your medical care. For this reason, strongly consider drafting these documents with a lawyer rather than going it alone.

The State Attorney General’s Living Will Lockbox

Once you’ve established a living will, it’s important that people be aware of it. If they’re not, then there is no way for anyone to know what your wishes would be in the event that you need life-sustaining care. The state of Nevada provides a way for individuals to address this concern, as the State Attorney General provides a “Living Will Lockbox” through the Internet. Here, an individual can upload their living will, where it will remain until it’s needed.

In addition to this, and depending upon your circumstance, you may wish to carry a living will card in your wallet. This card would direct people to your living will, so that they can know your wishes with respect to life-sustaining and end-of-life care. When used in conjunction with the State Attorney General’s lockbox, you will be absolutely assured that the terms of your living will are followed to the letter.

Estate Planning - 03/03/2015

Potential Problems With Domestic Asset Protection Trusts

Nevada happens to be one of only a few states in the union that permits the creation of domestic asset protection trusts. While this is an obvious advantage to those who are concerned with estate planning within the state, there are some disadvantages that should be taken into account when setting up such a trust. In order to better educate the public about the potential disadvantages of a domestic asset protection trust, we thought that we’d share a few.

State-by-State Laws

As we’ve already mentioned, domestic asset protection trusts do not exist in every state. Because of this, it’s possible to run into problems when the parties that might be challenging the trust are from different states. In these instances, certain state courts may not be willing to honor the terms of the domestic asset protection trust, which rather obviously negates its purpose. For this reason, any litigation concerning a domestic asset protection trust will begin with an evaluation of which state’s laws should apply to the trust.

The Constitution’s Full Faith and Credit Clause

Even if a ruling is made in the favor of the domestic asset protection trust’s home state, there are more issues. While the “full faith and credit clause” of the constitution may provide protection for the domestic asset protection trust, that’s not a sure bet. In fact, the case law surrounding these kinds of conflicts is scant at best, so it’s impossible to say for certain what the outcome of such a circumstance might be.

Potential Exceptions

The ability of a domestic asset protection trust to protect the assets contained within it is not ironclad. In fact, there are more than a few exceptions that might allow creditors to get at the assets contained within the trust. Most importantly, if a court determines that assets placed into the trust were moved with the intent to avoid paying those creditors, it will be considered ‘fraudulent conveyance’. This means that the creditor will be permitted to take the money they’re seeking from the domestic asset protection trust, which negates the trust’s purpose.

The Federal Government

Even though the state of Nevada provides for these kinds of trusts, that doesn’t mean that they’re not subject to the laws of the federal government. In fact, the laws of the federal government trump those at the state level. For this reason, if litigation surrounding a domestic asset protection trust makes it into the federal court system, the trust could become quite vulnerable.

Even So…
Despite these potential problems with a domestic asset protection trust in Nevada, they still remain a strong way for protecting assets from creditors. If you believe that you’re in a position where this could be a concern, then it simply makes sense to consult with an experienced estate planning lawyer in Nevada, one who can help you craft a domestic asset protection trust that will hold up should the worst come to pass.

Estate Planning / Trusts - 03/02/2015

Protecting People with Special Needs in Nevada

According to data from the US Census Bureau, approximately 1 in 10 individuals in the state of Nevada suffers from some kind of disability. These individuals face problems that are not faced by those who are not disabled. For this reason, those who have guardianship over, or otherwise care for, these disabled individuals should be aware of the steps that they can take to shield them from the onerous laws of the state and federal government.

Without a doubt, one of the best ways protectors of the disabled can ensure that their charges receive the utmost care is to establish special needs trusts. If you find yourself in this position, then we’re here to explain the legal situation facing the disabled within the United States and how you can obviate these issues by establishing a special needs trust.

The Problem Facing the Disabled in the United States

In the majority of cases, those who care for the disabled lack the financial means to do so by themselves. To make up for this gap, the government provides certain benefits to the disabled, which ostensibly should help them to get whatever care is needed. However, as with most government programs, the benefits of the state leave a lot to be desired. For this reason, those that care for the disabled often find themselves supplementing the benefits that their disabled charges receive.

Disabled individuals who receive benefits from the government in the form of Medicaid and Supplemental Security Income have limitations placed upon the assets that they are allowed to hold. Although these disabled individuals can have whatever they want, possessing a certain level of assets automatically disqualifies them from continuing to receive the benefits that the government provides. This means that an inheritance, or receiving other assets may become a financial disadvantage for the disabled person.

Special Needs Trusts as a Solution

Thankfully, there is a way to get around this issue, and it’s called the special needs trust. In a nutshell, such a trust acts as a way to make sure that a person with special needs is provided with ample funds, while at the same time not directly passing those funds to the person with special needs, which would disqualify him or her from the government benefits they are receiving.

Generally speaking, the grantor will establish the fund and then select a trustee who will be responsible for overseeing the special needs trust. This trustee should be someone trustworthy and who has the disabled individual’s best interests in mind. That’s because the funds in the trust are accessed directly by the trustee in order to purchase goods and services for the disabled individual. While the trustee provides these benefits for the disabled individual, these benefits are not considered to be “owned” by them, as they are technically owned by the trust.

If there is someone that you care for that you think could benefit from a special needs trust, then get in touch with a Nevada estate planning lawyer like the ones in our office. They can help you to set up the trust and ensure that the disabled person that you care for is tended to, not only now, but also into the future.

Estate Planning - 02/27/2015

The Benefits of an Irrevocable Trust

While many prefer to make trusts revocable, meaning that they can be changed during the grantor’s lifespan, there are plenty of reasons to make a trust irrevocable. These kinds of trusts are well known as a means for the wealthy to ensure that their assets remain available to their benefactors after they die. However, irrevocable trusts aren’t just for the wealthy; they’re for everyone. And, they happen to be one of the best ways to pass on an inheritance to your beneficiaries. To explain why, we’re going to go over some of the benefits of irrevocable trusts.

• Avoiding Estate Taxes: When assets are held in a revocable trust, they are still considered to be the assets of the grantor. For this reason, they can be subject to estate taxes when the grantor passes away. This is not the case with irrevocable trusts. When assets are placed into an irrevocable trust, they are no longer considered to be a part of the grantor’s estate. This makes them exempt from estate taxes, as these assets are owned by the trust and not the grantor.

• Shielding Assets from Creditors: In much the same way that an irrevocable trust shields your assets from estate taxes, so too does it shield your assets from creditors. However, there are some wrinkles to this, which we explore below.

• Privacy: If your assets are significant enough that you’d like to keep them hidden from the public, placing them in an irrevocable trust is a great way to do so. In addition, the trust also keeps your assets out of probate court, which would make those assets a matter of public record.

• Maintaining Cash Flow: Although the assets that are held inside of an irrevocable trust are technically owned by the trust, profits that are gained off of its holdings or interest accrued can be paid out on a regular basis. If the assets and holdings are significant enough, this can make an irrevocable trust a valuable source of income during retirement years.

Things to Watch Out For

As mentioned, one way that people use irrevocable trusts is to shield assets from creditors. However, if you’re thinking about an irrevocable trust for this purpose, then you should tread cautiously. The reason is simple. If you have a reasonable anticipation that creditors will (or already are) coming after your assets, then moving them into an irrevocable trust will most likely be viewed as fraudulent. Rather obviously, this puts both your assets and your legal standing at risk.

However, if you’re thinking of making this move more as a preventive measure, then you’re on solid ground. In fact, many people elect to use irrevocable trusts as a kind of failsafe, a way to protect themselves against the unforeseen eventuality of creditors coming after assets. If you find yourself in a position where you think such a financial move might be necessary, then it would behoove you to consult with an estate planning attorney who is well versed in the laws surrounding irrevocable trusts like the ones at Clear Counsel Law Group.

Estate Planning - 02/25/2015

Things to Think About When Granting Someone Power of Attorney

Even if it’s just to prepare for a certain eventuality, granting someone power of attorney is a decision that shouldn’t be taken lightly. Because of this, we thought it would be important to share a few things that you should think long and hard about when you’re granting someone power of attorney.

Think About Yourself

Granting someone else power of attorney is an important matter. Before you enter into such an agreement, you should think long and hard about whether or not it’s necessary. If you judge that it is, then you should also consider the extent to which you will need someone to act on your behalf. What are you capable of doing for yourself, and what are you not capable of doing for yourself? Only after you’ve asked yourself these questions will you be able to determine the best course of action for giving another individual the power to act on your behalf.

Think About the Person Taking Power of Attorney

When you grant someone else power of attorney over yourself, you are vesting them with a great deal of power, no matter how limited the power of attorney agreement is. Before you give anyone the right to act on your behalf, make sure that you have full confidence in their ability (and desire) to keep your best interests at heart. Anyone that has shown a propensity for mishandling financial matters or generally has a track record of making poor decisions is not a good person to grant power of attorney to, even if you feel close to that person. Instead, select someone whose trustworthiness is unimpeachable, understands your interests and situation, and who will act objectively and reasonably on your behalf.

Think About the Limitations

When you grant someone general power of attorney, you are essentially allowing them to act on your behalf in all legal situations. Depending upon your circumstance, this may or may not be what you need. If that’s in excess of what you’re looking for, you can grant someone special power of attorney, which narrowly defines the capacities in which that person is able to act on your behalf. Among the various kinds of special power of attorney, there is healthcare power of attorney, which allows the person acting on your behalf to make important medical decisions for you.

Also, bear in mind that there are two forms of power of attorney: springing and durable. Springing power of attorney goes into effect when certain criteria are met (if you fall into a coma, for example), whereas durable power of attorney goes into effect upon the signing of the agreement.

Think About Your Lawyer

No matter how broad or narrow the power of attorney you’re granting is, there’s a lot to consider. That’s why it’s always advisable that such agreements be reached under the supervision of a qualified lawyer. They’ll be able to understand the particular laws in question and best advise you as to how the power of attorney should be set up. They can help to ensure that your rights are protected and that your needs are tended to.

Estate Planning / General Interest - 02/24/2015

Estate Planning for Same-Sex Married Couples in Nevada

Estate-Planning-for-Same-Sex-Married-Couples-in-Nevada In October, same-sex marriage officially became legal across the state of Nevada. This will now change the way same-sex couples in Nevada conduct their estate planning. It is important that these married couples take the necessary steps to take advantage of their new legal rights and adjust their estate plans accordingly.

The Supreme Court case United States v. Windsor changed federal policy, so that the federal government will recognize same-sex marriages in states where same-sex marriages are legal. On August 29, 2013, the IRS issued new guidelines on how that decision would affect IRS processes. Windsor does not affect states that do not have same-sex marriage, but states like Nevada are affected and couples in these states will now receive the same federal benefits and obligations as other married couples.

How Will This Affect Estate Planning?

Firstly, same-sex married couples can now take advantage of the unlimited marital deduction when transferring property between the spouses. Because of the deduction, these couples that already have estate plans must review them immediately. Estate plans are often written with formula clauses. For instance, estate plans may have a provision that transfers the maximum tax-free amount to the partner and then transfers the rest to a charity. Because these couples now benefit from the deduction, these formula clauses may now transfer more to the spouse than originally intended and it’s even possible that all would be transferred to the spouse and nothing would be left for charity. The American Bar Association recommends that same-sex couples review their estate plans and make sure they understand how much will be transferred to their spouse and how much will go to charity. They can then make changes to the plan if it’s appropriate.

Some estate plans might have created trusts because the deduction was not available. With legal same-sex marriage in the state of Nevada and the repeal of DOMA through Windsor, these couples may decide to terminate these trusts and take advantage of the marital deduction instead.

Section 2 of DOMA

Despite all of these changes that came with the United States v. Windsor, the Supreme Court decision did not strike down Section 2 of DOMA which ensures that states without same-sex marriage don’t have to recognize the marriages of other states. Because of this, same-sex couples should still take extra precautions to protect their estate and their interests in other states. According to Nolo.com, spouses should carry power of attorney regarding health care decisions, so that they can still make health care decisions for one another when they are traveling in states without same-sex marriage. In addition, spouses should always obtain adoptions for their children if they are not the birth parent. Without adoption orders, they may not be recognized as the parent when traveling through states without same-sex marriage.

All couples throughout Nevada may now enjoy many benefits that were not available to them a few months ago. The legalization of gay marriages will affect financial planning and estate planning for same-sex couples. Now with these changes underway and slowly being implemented, it is the time for couples to review their estate plans and make sure they are structured as intended to satisfy their obligations to their spouses as well as to charities.

Estate Planning / Nevada Law - 02/23/2015

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