Estate Planning

Clear Counsel Law Group / Estate Planning

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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

Is There an Easy Way to Avoid Probate in Nevada?

As anyone with any experience in estate planning will tell you, probate proceedings are a thing to be avoided at all costs.

Of course, they cannot always be avoided. Sometimes family members of a deceased individual find themselves in probate court, dealing with the associated costs and maddening bureaucracy.

These individuals will probably wish to find ways to get out of probate as quickly as possible. In the state of Nevada, unfortunately, there are not as many options for doing this as these individuals might wish.

If the estate that’s ended up in probate is sizeable, then you’re stuck in probate. However, the state of Nevada allows for certain legal shortcuts for those estates that are not especially large.

There are two categories of estates that can be considered in this manner, those that are $20,000 or less and those that are less than $200,000. We will handle them each separately.

Probate in Nevada for Estates Worth Less Than $20,000

For these estates, a simple affidavit will suffice for settling the estate and getting it out of the probate courts.

To do this, a person that believes they have a right to inherit property or assets from the dhttps://www.clearcounsel.com/services/nevada-probate/synopsis-nevada-probate-law/eceased submits a document that is signed under oath to make such a claim.

In other words, they submit an affidavit to the probate court. It is important to note, though, that these affidavits cannot be submitted to claim real estate.

Also, not just anyone can submit such a claim.

These affidavits can only be filed by immediate family members, as well as siblings, grandchildren or parents. Finally, any assets or property that are inherited in this manner are subject to a 40-day waiting period.

Probate in Nevada for Estates Worth More Than $20,000

For estates that have more value than the above and include real estate, the executor can file a motion for a simplified probate proceeding. If the court approves, then a simplified, more expeditious probate proceeding will take place.

Also in some cases, the courts will permit that executor to divvy up the estate without the need for a probate proceeding. For estates that are valued at $100,000 or less, the probate courts may simply divide the estate’s assets between the deceased’s children and spouse.

If you find yourself dealing with an estate of this nature, it may be wise to consult an estate planning lawyer who can determine if a simplified probate proceeding is the best course of action.

We Can Make Probate in Nevada Easy for You

The best way to avoid probate all together is to have an ironclad plan for your estate. To do this, you will want to consult with a qualified estate planning attorney, experienced with probate in Nevada, like the ones in our office.

At Clear Counsel Law Group, we will be able to help you establish a last will and testament, create trusts, and pursue other options that will allow you to keep your estate out of the probate courts after your demise.

Ultimately, doing this will be to your beneficiaries’ benefit.

Not only will they not have to deal with litigation in a probate court, but they will also stand a better chance of receiving their inheritance without the government taking substantially more than its fair share through estate taxes.

Estate Planning / Probate - 02/19/2015

How Inherited IRAs are Affected by the Supreme Court’s Decision

This past summer in Clark v. Rameker, the Supreme Court ruled unanimously that inherited IRAs are not retirement funds and thus are not protected during bankruptcy proceedings. This decision will have a clear impact on estate planning because IRAs passed onto heirs are no longer protected like they once were, and spouses who receive IRAs after death must now make a decision regarding IRA rollover.

In Clark v. Rameker, Heidi Heffron-Clark inherited an IRA after her mother passed away in 2001. In 2010, she and her husband filed for bankruptcy and intended to shield this inherited IRA from creditors by counting it as retirement funds. In the past, courts have allowed heirs to do this, but in a stunning reversal, the Seventh Circuit Court of Appeals and the Supreme Court ruled that inherited IRAs cannot be counted as retirement funds and cannot be shielded during bankruptcy.

In its decision, the Supreme Court asserted that inherited IRAs do not function the same way as IRAs that you set up yourself, and so they should not have the same legal protections. The Court explained that inheritors cannot add funds to inherited IRAs, inheritors must begin to withdraw from the IRA even if they are not close to retirement, and inheritors can take large distributions from the IRA at any time and without penalty. Because of these three differences, the Supreme Court argued that inherited IRAs are not like normal IRAs and do not function as retirement funds, so they will not be afforded the same protections. Individuals should now adjust their estate plans accordingly because transferring IRAs to heirs will no longer be as beneficial as in the past.

Spouses Who Inherit IRAs

Unlike other individuals who inherit IRAs, spouses have the option to roll over the IRA into their own existing IRA. In the past, surviving spouses often had no reason to roll over because they could just maintain both IRAs and be confident that both would be protected during bankruptcy. With the new Supreme Court decision, surviving spouses should seriously consider rolling over their inherited IRAs. According to Investment News, the spouses may have to pay 10% early withdrawal penalty if the funds are transferred before they turn 59.5 years of age. However, in many cases this penalty is worth it in order to protect those funds in the case of bankruptcy.

Protecting IRAs for Non-Spouse Heirs

Although the Supreme Court has taken away the primary protection for inherited IRAs, there is still a way for estate planners to make sure that these IRAs are protected from bankruptcy proceedings. According to Forbes, by naming trusts as the beneficiaries of IRAs instead of naming people, these funds can still be available to your loved ones after you pass away and can still retain their prior protections. Of course, establishing trusts is a much more complex process, so individuals should make sure they want to take this route and should seek the advice of estate planning experts.

Clark v. Rameker has changed the rules regarding inherited IRAs and made them a less attractive asset to pass on to your spouse or children, but it’s important to remember that with rollovers and trusts you can still protect these assets and make them available to your loved ones.

Bankruptcy / Estate Planning / General Interest - 02/18/2015

How to Write a Will

While most people understand the importance of having a will, they typically do not know what steps to take to write one. In some situations, having a professional write your will is best, especially for large estates. However, it is possible to write your own will.

Writing a Will

The first step in writing your own will is deciding which tool you will use to draft it. While it is legal in some states to hand write a will, it is strongly suggested that a typed copy is created, as a formal document will make the probate process after you death much easier.

There are various tools that you can use to draft your will, including:

Statutory forms – These forms are customized to various state laws. (Only a few states have these.)
Flat forms – These blank forms are filled in by using your word processor.
Will software – With various will software programs, you answer questions and then the program automatically creates the will based on your answers.
Will books – Will books provide helpful instructions on completing flat forms, as well as offering advice on other aspects of estate planning.
Online will programs – Like will software, you create the will within a template program, however this would be done online.

Make sure that you pick the tool that works best for you and one with clear instructions. That way, the will that you create effectively communicates your last wishes.

What to Include in Your Will

While no states require specific information or language in wills, you do want it to be easy to understand for those who will work with your will after you death. Wills are typically used to distribute property, as well as other assets. Wills can also do the following:

Name an executor – Executors are in charge of fulfilling the deceased’s last wishes and to clear all debts.
Name guardians for young children – This will include stating how the children’s inherited property and assets will be managed.
Explain how debts and taxes are to be paid and cleared.
Designate a caretaker for pets and how to provide for them.
Act as a backup for a living trust.

Wills are not intended to do the following:

Put conditions or guidelines on gifts. (For instance, courts will not enforce conditions such as a recipient only receiving inheritance if he or she marries a specific person or if he or she changes religion.)
Leave property for pets.
Name life insurance beneficiaries or other payable-on-death bank accounts.
Funeral arrangements. (It is best to create a separate document that states how to handle final arrangements.)

Make Your Will Legal

Making a will legal involves the following:

The will maker’s signature.
Two witness signatures.

Keep in mind that your witnesses do not need to read the will, as they are only signing to acknowledge that it is a will. In most states, you can also include a self-proving affidavit that will make the probate process easier after your death. Also, wills do not need to be signed by a notary public to make it legal.

Seeking Legal Assistance for Wills

If your estate is more complex and you think that an attorney would be helpful in creating your will, contact Clear Counsel Law Group to set up a consultation. The estate attorneys at Clear Counsel Law know how to create a will that reflects your final wishes.

Estate Planning - 01/27/2015

Don’t Wait to Plan Your Estate

Although we all know estate planning is important, most of us would prefer to put it off. However, it’s one of those things you simply need to get done or the repercussions could be severe for those most important to you. Let’s discuss some of the reasons you should get started today.

It’s Not Just for When You’re Deceased

No one wants to think about their own demise, which is one of the main reasons they put off planning their estate. It’s important to remember, though, that estate planning is not just about when you pass away.

What happens if you were to become incapacitated? A tragic event could leave you disabled too. With a drafted estate plan, you can rest assured that someone is available—someone you trust—to look after your affairs. Furthermore, they’ll have clear-cut instructions to follow for doing so.

Avoid Unnecessary Taxes

That being said, obviously, estate planning is central to planning for your passing. One of the major disadvantages every family faces when their loved one passes without an estate planned is taxes. Income and capital gains taxes can strip your savings, leaving far less left for your loved ones.

With a well-drafted plan, estate taxes can be greatly minimized or even avoided altogether.

Ensure Your Wishes Are Honored

Without an estate plan, you’ll be lucky if all of your wishes are properly honored when you’ve left this life. Once you’re gone, divorces in your family, lawsuits and creditors can all challenge who owns what you’ve left behind. Your spouse could also remarry someone with children, who would then have some entitlement to your money.

Once again, with a solid estate plan, you’ll have your wishes spelled. Challenging them will be difficult.

In fact, with a “no-contest” provision, your plan will be virtually bulletproof. Such a clause will most likely discourage anyone from challenging it.

Help Inexperienced Loved Ones

Just because your loved ones get your money as you planned does not mean they will use it as you would have liked. Some of your family members may not have experience with the amount you’re leaving them.

Fortunately, you don’t have to be around to guide them in using the money responsibly. Your estate can actually include instructions that the beneficiary has to follow. For example, you could leave some of it as a college fund or insist that it goes into an account that can’t be touched for a certain number of years.

You can even take things a step further and stipulate that certain funds can only be accessed by family members after they’ve completed certain milestones in their life. This will also protect your money from depletion if your heirs do make poor decisions.

With Clear Counsel Law Group, you don’t have to put your planning off to another day. Our firm was created by the joining of two others, giving us unrivaled experience in the area of estate planning. Call us today at 702-522-0696 and we’ll work with you to ensure your wishes are known and followed.

Estate Planning / Probate - 01/21/2015

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