|Focusing your vision, achieving results|
-- Lester R. Bittel
by Deborah Pechet Quinan, Esq.
Your Will - Why Procrastination is Costly for Your Heirs
Your will determines how your property passes at death. In order to minimize costly probate proceedings (costly in many states, not in all), your will should generally leave your assets to a revocable trust (please see below). Such a trust is a "will substitute" since it determines how your property will flow upon your death. If you do not have a will, your estate passes under the intestacy law of your state of residence. For example, in Massachusetts, if you die without a will and are survived by your spouse and children, they will generally share your assets equally. If you have a spouse but no children, your spouse will share your estate with your next-of-kin, usually your parents. This is hardly the result most people want, as it can unnecessarily accelerate estate taxes! A will that leaves your assets to a properly drafted revocable trust can minimize probate, and can also alleviate estate tax and other financial concerns to the extent possible under the law. This way you can provide for your family in a manner that benefits them, not Uncle Sam.
Your Revocable Trust - A Necessary Tax and Probate Minimization Tool
Your revocable trust will be the tax and non-tax planning vehicle for your estate plan. In recent years, federal and many states' estate tax laws have changed significantly. If you have not had your estate plan reviewed recently by an attorney who specializes in this area, you should do so at minimum to avoid paying unnecessary state (if your state of residence imposes an estate tax) and federal estate taxes at the first spouse's death. Uncle Sam's long- term share of your family's assets is currently 47%, and state estate taxes are in addition to that. For example, in Massachusetts the state estate tax will be assessed on all of your assets if your total taxable assets exceed the Massachusetts estate tax return filing amount.
In addition, your revocable trust allows your assets to be managed for your and your family's benefit, if you become incapable of doing so yourself. After your death, your trust provides a mechanism to manage funds for family members who are not capable of handling the funds themselves.
Health Care Proxy, Living Will, and HIPAA Authorization
A health care proxy, authorized in many states by state statute, allows someone else to make health care decisions for you once a physician determines that you are unable to do so for yourself. Massachusetts, for example, has such a statute. The health care proxy, accompanied by a Living Will, will provide your family and the medical community with an expression of your desires regarding life sustaining measures. The Health Insurance Portability and Accountability Act ("HIPAA") is a federal law that prohibits disclosure of your medical information to unauthorized third parties who are not physically present, including spouses. This law can even prohibit you from making medical appointments for someone else! Therefore, it is important to have a separate HIPAA Authorization authorizing your loved ones to help guide your medical treatment.
Durable Power of Attorney
A durable power of attorney authorizes someone else to act as your agent in financial matters. It can either take effect immediately upon signing, or when a physician declares you to be incompetent. Financial institutions prefer recently executed powers of attorney, so you should review yours when you review your estate plan, or when you become ill or plan an extended trip.
The thoughtful estate planning process should take two to four months, and your attorney will do most of the work. If you can make decisions and attend two or three meetings via telephone or in person, your family will thank you for putting your affairs in order in a tax-efficient manner that addresses long-term family considerations. Your estate plan should be reviewed every three to five years, or whenever your personal circumstances or tax laws change.
This summary was prepared by Deborah Pechet Quinan, Esq., a partner in the Boston law firm of Rackemann, Sawyer & Brewster. Attorney Quinan can be reached via e-mail at the following address: email@example.com.
This summary is presented for informational and educational purposes only, and does not constitute legal advice. Use of this summary does not create an attorney-client relationship and is not a substitute for legal counsel.
Last month the focus of our call was completing work projects that required a concentrated amount of time to get done. Here's what one of our new participants had to say: "'Pounce on a Project' helped me focus energy and commitment on a project that I had been procrastinating on. By the end of the 'Pounce' session, I had finished the project and gave myself permission to feel the accomplishment and have a reward." -- K.C., Environmental Professional, MA
Join us in Pounce on a Project to complete the project(s) that will result in the biggest positive impact on your life or business.
Join Coach Andrea on Thursday, June 16th, from 8:30 a.m. to 12:15 p.m. Eastern. We will join as a group by phone and declare what you want to accomplish: putting together a new marketing piece, finishing that client project, backing up your computer before you buy a new one, making those cold calls, organizing your office, simplifying your filing system, or cleaning under your bed.
During the morning, the group will gather by phone a few times to check progress and get any support needed to finish with a bang. At noon, the group will celebrate their accomplishments. Who says projects have to be boring and tedious? Bring your lightness and fun and join us for the energization.
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