Dodging the Estate Tax

Here is an interesting article from the Wall Street Journal, which discusses medical issues families of wealthy Americans are facing as 2009 comes to an end and 2010 is ushered in. Why? In 2010, under current law, the estate tax lapses. For someone with an estate large enough to trigger the tax, dying in 2010 versus 2009 can have huge financial implications.

The article raises a good question -- if Congress couldn't fix this mess of a law this year, what makes us think they'll get the job done in 2010? Only time will tell.

More on the Federal Estate Tax

Watching and reading about Congress' action related to the estate tax, I came across an interesting tidbit in the NY Times:

There is yet another wrinkle. When they scheduled the demise of the estate tax for 2009, the authors of the 2001 tax measure replaced it with a capital gains tax of 15 percent on inherited property that is later sold.

The threshold for being subject to those taxes is set lower, with the first $1.3 million in capital gains exempted for general heirs and $3 million for spouses. Democrats argue that thousands of estates that would not have been subject to taxes under the current law could get hit in 2010 even as those at the higher end of inheritance scale escape the 45 percent tax bite.

Taxes are a certainty, but how the play out appears not to be. Stay tuned for more updates.

Aging in a Rural Community

The NY Times ran a touching article today about aging in rural America.

Growing old has never been easy. But in isolated, rural spots like this, it is harder still, especially as the battering ram of recession and budget cuts to programs for the elderly sweep through many local and state governments.

Farms and the Estate Tax

According to this post, it appears that some are advocating Congress to exclude farms from the estate tax. Interesting? Would that be small farms, big ag farms? Ah, yes, the ever present question of definition in the law.

Still no firm answers on the estate tax, and the clock is ticking.

Improve Your Health by Gift Giving?

Sure, we all know that gift giving can, in some cases, result in a tax break. But what about improving your health? That was the topic of a NY Times article this week, In A Month of Giving, A Healthy Reward. The article focuses on the book, 29 Gifts: How a Month of Giving Can Change Your Life by Cami Walker.

“Giving for 29 days is not suggested as a cure for anything,” Ms. Walker said. “It’s simply a coping mechanism and a simple tool you can use that can help you change your thinking about whatever is going on. If you change your thinking, you change your experience.”

The concept and book sound intriguing....I'll have to give the book a read and the concept a try.

Burglars Target Homes Based on Obituary

One of the "to-do" items on my list when we were preparing for my father's visitation and funeral was to ask a neighbor of my parents to keep an eye our their home while we were at the funeral. Some thought I was a bit too skeptical, but based on recent local news, I'm glad I did. Turns out the local thieves are using obituary listings to determine when people will be away from the home, and break in. A summary of the events is available on NBC 15's web site. Publishing the day and time of a funeral is a basic element of an obituary. My recommendation, make sure there is someone, a neighbor or friend, who can keep an eye on the home during the event.

Madison, Wisconsin Tops List of Charitable Cities

Yes, once again my home town sits atop a best of list, this time of charitable cities. This pleasant news came to my attention in the Wisconsin State Journal. As the end of the year approaches, many people consider making donations, motivated both by goodwill, and tax deductions. A prior post on my site, To Give or Not to Give, offers advice on selecting a worthy charity.

Musing about the Federal Estate Tax

As the end of the calendar year draws near, there is more and more speculation about when Congress might take action to address the federal estate tax. Today the Wisconsin Law Journal ran an article on the federal estate tax. Laws on the books call for the tax to end in 2010, and then resume in 2011 at $1 million. That means, in 2011 if an estate was valued at $1 million or more, the federal estate tax would apply. The current exemption level is $3.5 million, meaning estates below $3.5 are exempt from the federal tax.

What does this mean for you? Well, if you are a farmer or small business owner it makes estate planning a bit tricky....we're not certain what the new exemption level will be. There are several bills floating around DC, and the prevailing thought is the higher the exemption level, the better.

Why is the estate tax so troublesome? Well, it applies on liquid and illiquid assets. Horror stories about of small business owners or farmers dying, leaving behind an estate worth more than the exemption, but little cash to pay the IRS...often leading to a fire sale to generate cash quickly.

As the year ticks to an end, keep your eyes on Washington for movement on this issue.

Delay and Blended Families

I came across this article about Peter Seller's estate. Apparently he died before signing a divorce settlement. As a result, the settlement was never enforced. His soon-to-be ex-wife inherited his entire estate, who then died leaving it to her daughter. Seller's three children from prior marriages were left 750 pounds each!

This is a Hollywood story, but carries important lessons for all. First, legal papers are not binding until they are signed. This is true for estate plans, not until they are signed to the carry and legal weight....so don't delay in putting your date and signature on the forms. Second, if you have a blended family you really, really need to give some thought to what will happen to the assets when the first spouse dies. If you don't, State statutes will control and may differ from what you would have wanted.

Thoughts on Writing an Obituary

With my father's death, I faced the hardest writing assignment I'd ever had.....writing his obituary. When grief is washing over you, penning a final tribute to a loved family member is not easy. If you are stuck and not sure what to do, take it one element at a time, include the decedent's:

• full name,
• age,
• date of birth,
  
• date of death,
• residence,
• place of birth (if different),
• relationship status (married, partnered, widowed),
• name of surviving family (parents, spouse/partner, children, etc.),
• preceded in death by (list family who has died),
• educational and vocational background,
• memorial or funeral service date, time, and location,
• whether there is a public burial,
• organization if "in lieu of flowers" is being used, and
• a personal touch (nickname, family memory, adjectives, poem, spiritual verse).

Start with the formula, and sprinkle in bits that bring out the unique life of the person you are paying tribute to.

Facebook Memorials

Yes, even the social networking site Facebook has a policy for handling a person's death. Interested in learning more? Click here for a link to a blog post on how FB handles this type of situation.

Federal Estate Taxes Still Being Discussed

Here is another story discussing the possible extension of the federal estate tax into 2010. According to the article, not the tax may be extended into 2010, but the exemption level may be increased to $5 million per person.

Remember, until the legislation is signed, it is just a proposal. There is no definitive change yet.

Wal-Mart Rolls Out Caskets....

Yes folks, the funeral industry has a new supplier to compete with....Wal-Mart has just begun selling caskets on-line. Prices range from $500 to $5,000. And, under federal law, funeral homes are required to accept 3-party caskets.

What is a Flower Bond?

The Power of Attorney for Finance forms I prepare for my clients includes the authority for the named agent to deal with issues related to "flower bonds". Every now and then I have a client who asks, what is a "flower bond". Here is a great definition:

Any of a limited series of U.S. government bonds that may be used at par to pay federal estate taxes. The bond is unique because there is no minimum time for which it must be held; further, its holder does not have to wait until maturity to use it at par for paying the tax. Flower bonds have not been issued since 1971.

Walter Cronkite Leaves Papers to University

The following NYTimes article provides a nice summary of the will of Walter Cronkite, in which he left his papers to the University of Texas.

The will bequeaths Mr. Cronkite’s personal papers to the university, a process that started before his death on July 17 but will now end with the release of materials he had held onto at his office and homes in Manhattan and on Martha’s Vineyard.

Much of the newsman’s other assets will be divided among his three children: Walter Leland III, known as Chip; Mary Kathleen, known as Kate; and Nancy Elizabeth. Chip Cronkite said the family was happy that so many of his father’s papers would be kept by the university.

I have often encouraged clients to consider leaving photos and other heirlooms to a museum or culture center where they can be enjoyed by many. My own family is considering doing this with some items my father had inherited from his Swedish ancestors.

Federal Estate Tax and Cost-Basis

The Wall Street Journal ran an interesting article on the estate tax. Here is something that struck me:

At issue is the "step-up in cost basis" that all assets receive when an owner dies. The way the law is currently written, if the estate tax goes away, so does the step-up in cost basis. That's where the problem lies.

Step-up means that the property heirs receive is valued as of the date of death. So if Grandma leaves a grandchild stock selling for $75 a share that was bought in 1970 for $2 per share, the heir's "cost basis" in the stock is $75. If the grandchild then sells the stock for $80, the taxable gain is $5 per share. The same holds true for both real estate and personal property, like an heirloom ring or art.

If Congress fails to extend the current system for 2010, then at the owner's death all assets would retain their original cost, called "carry-over basis." Under this system the heir's stock would have a cost basis of the original $2 per share rather than $75. If he then sells the stock at $80, the taxable gain would be $78 instead of $5—a huge difference.

Webcasting Funerals

Here is another story about the convergence of technology and death; webcasting funerals. Yes, at first this might seem a bit odd, but the story offers several reasons why this might attract customers. Recent customers included military personnel stationed overseas, a women 9 months pregnant and unable to fly, and a women in the hospital and unable to leave. The article states that younger generations are sharing more and more of their lives on-line, and that trend is entering the funeral business.

Remember, in Wisconsin a person can complete a Authorization for Final Disposition form, which allows you to appoint someone to be in charge of your funeral and to leave specific instructions. Webcasting might be something you'd want to mention on such a form.

I'd be curious to hear from those who have experienced this type of service. And thanks to my husband who spotted this article.

If you seen an article or have a topic you'd like to know more about, please leave a comment.

Movement on the federal estate tax

Monitoring a legal blog kept by a law professor, I came across a report that Rep. Schrader (D. Oregon) introduced H.R. 3841, a bill "[t]o amend the Internal Revenue Code of 1986 to repeal carryover basis for decedents dying in 2009, to increase the estate tax exemption to $5,000,000, and to reduce the maximum estate and gift tax rate to 45 percent." Only time will tell what will come out of DC, but it certainly looks like the current law will be changed soon.

Upcoming Estate Planning Seminar

On Saturday, November 7th, at 1pm, I will be giving a free seminar on estate planning and charitable giving for the John Muir Chapter of the Sierra Club. The presentation will be held at the First Unitarian Society, and will be followed by a tour of FUS' new, "green" addition. Learn more about this FREE event, that is open to the public, by clicking here.

Picking a Power of Attorney for Health Care

Every seminar that I conduct has a component devoted to discussing powers of attorney for health care. During the discussion, I encourage people to really think about who they name as their health care agent, and the back-up. Never go with someone out of a sense of obligation, rather, select the person who is right for the role. Who, in your circle of family and friends, is right? Here are a few points to consider:

• who is comfortable dealing with doctors and other medical staff;
• who will be able to handle seeing you in a very ill state;
• who will speak for you, based on wishes you communicated earlier, and not simply state what they want; and
• who has the time to be at the hospital or long-term care facility.

This last point is one that challenged me during my father's recent illness and death. When we first drafted his forms, I was married, but childless. However, I now have a young child, and being at the hospital was a challenge -- my father was there nearly a month before passing away. Having a young child, too young to be spending more than an hour at a hospital, did not prevent me from being a back-up agent, but it did present challenges. Thankfully, I was available via phone and carved out as much time as I could to be physically present.

What is palliative care?

"Palliative care", up until August I had a vague sense of what this phrase meant. Now, I have a much better understanding having been at my father's side during his last illness, decline, and recent death. It was a Friday when his physician said "he is not going to recover from this illness, we'd like to have you speak with the doctors from palliative care".

I knew it was like Hospice, but I was not able to give a good, concise definition. We met with palliative care team, and the decision was made to transfer my father to their unit. What did it mean? Palliative care does not mean "non-medical" or "non-treatment". Instead, the medical treatment is for comfort rather than curative measures. Comfort, not a cure -- that was the goal. Hospice, the term I was much more familiar with, is a brand of palliative care, a company name essentially.

Personal Experience

Lately I have not been blogging. The reason, in mid-August my father entered the hospital. After nearly three weeks the decision was made to transfer him to palliative care. He passed away on September 18th. His funeral will be later this week. In the weeks and months ahead I plan to blog about my own personal experience with end of life issues, burial, and the paperwork issues we faced. The wounds are still fresh, but I can already tell that I have new insight into my estate planning and probate process because of this experience. Hopefully I can share what I have learned, and it will ease what others face.

Regards,
Melinda

Update on The Restoring Hope Transplant House in Middleton

Channel3000 had a short-update on the status of The Restoring Hope House in Middleton....it is $150,000 away from meeting its fund raising goal. The director thinks it will be up and running by 2010. For those of you not familiar with The Restoring Hope House, here is some information from its web site:

Restoring Hope Transplant House will be a “home away from home” for patients who are in the Madison area for organ, bone marrow or other transplants. A transplant house is not a medical facility. It is a caring environment that offers high quality, affordable accommodations for patients and their adult family members/caregivers. In addition to physical housing, the House offers hospitality, compassion and hope to support the healing journey for the patient and family. The support is provided by a small core staff, many volunteers and through interaction between other families facing the same challenges.

Signatures on a Will

I'm type A, most attorneys are. When I coordinate a will signing for a client I have them sign and date at the end, but I also have them sign the bottom of each page. Occasionally I hear some grumbling, mainly from witnesses who sign each page as well. But, when I read about cases where will challenges were based on the fact the will only had one signature line, I'm glad I'm thorough. Certainty, to the extent anything can be "certain", is a large component of what I provide to my clients.

Seeking to Comfort

Recently I heard of an on-line company that sells unique gifts to express words of comfort to someone who is grieving. The Comfort Company offers different kinds of gifts, from memory trees to jewelry. It is an interesting concept. Another option to express sympathy is to make a donation to a charity that was important to the person you are memorializing or are seeking to comfort.

Inspiring Story - Ida Fischer's Estate

Ida Fischer is not a name most Americans know, but she is featured in a profile on CNN's web site. Famous among her New York City neighbors for her frugality, she stunned everyone at her death in 2007 by leaving an estate of more than $300,000 -- half of which she donated to a University in Israel. Her story is inspiring; I too am frugal, but not to the extent she was. Here is an example of how one person can make a difference in the life of a non-profit.

Seminar - Estate Planning

This Saturday, August 15th, I will be participating in the 9th Annual Asset Builders' Money Conference. For the 3rd year, I will be speaking on the topic of wills and other important documents. This event is open to the public. Learn more from the Asset Builders' web site.

Unintentionally Triggering the Gift Tax

Yet another client who was named as the solo beneficiary on a parents retirement account, with the understanding that the child would "take care of his siblings".

Yes, often people will designate one child to be "in charge". That is appropriate with a will because the Personal Representative distributes assets according to the will - they don't inherit it all. But, when only one child is named as a beneficiary, that child inherits everything. And if the share that they want to pass along to their siblings is greater than the gift tax exemption ($13,000 in 2009), then the child is responsible for the gift tax. If they inherit it, they own it, and are now giving it away.

This can be avoided if beneficiary forms list ALL for the people who are intended to inherit. This means if you have 4 children and they should all receive 25%, then all 4 need to be listed on the beneficiary form.

Estate planning is a complex and ever changing area of the law. It is always best to seek the counsel of a skilled attorney.

Movie - Departures

It is wonderful when work and pastimes combine. I am a movie fan, especially of "art films" and recently learned abut the movie Departures. It won an Academy Award for best foreign language film, and is set in Japan. Here is a summary from the films web site:

Spotting a Help Wanted ad featuring the word “departures,” he is excited about the prospect of trying a new career in the travel industry. He arrives for the interview, curiously eyeing the coffins lining the back wall of the office. The company owner, Sasaki (Tsutomu Yamazaki), hires him on the spot, with only a cursory glance at his resume. Daigo finally ventures to ask what is involved, exactly, and is stunned to learn what he has gotten himself into: the ceremonial “encoffination” of corpses prior to cremation. Sasaki urges him to take the job, proffering large amounts of cash. He’s getting older, and needs someone to carry on the tradition.

Hopefully I'll get a chance to see the film while it is playing at Sundance Cinemas in Madison.

Joint Tenancy vs. Tennants in Common

A recent client needed a bit of advice -- she owned a piece of property with some other family members, and she wanted her share to go to a different family member than the one she owned the property with.

Would her will allow her to do this? No, because the deed stated "joint tenancy" -- if any one of the joint tenants dies, the remainder of the property is transferred to the survivors. What she needed to do was have the property titled a "tenants in common" -- each party has the right to alienate, or transfer the ownership of, her ownership interest. This can be done by deed, will, or other conveyance.

As always, when dealing with legal issues it is always best to consult a legal expert for advice on your specific situation. Laws vary state by state, and from year to year depending on legislation.

History of the Estate and Gift Tax

1932 was the year Congress created the federal estate and gift tax. Ever wonder about it's history? If so, here is an social science article, the abstract technically, that offers the answer.

In this paper, I seek to reclaim this lost history of estate and gift taxation. While the ensuing analysis certainly will enable us to more fully appreciate the events of 1932 and evaluate the actions Congress took in that fateful year, my inquiry is not of mere historical interest. Rather, the choices made in 1932 have helped shape the fundamental structure of U.S. estate and gift taxation for nearly eight decades, including our modern estate and gift tax code. As such, understanding the events of 1932 can help us to understand why our estate and gift taxes operate the way they do as well as help inform future debate about the optimal structure of our wealth transfer tax system.

New Blog by a Hospice Doctor

Found a new blog kept by a hospice physician. Enjoyed the first posts, a bit long, but thoughtfully written.

Summary of Wisconsin Domestic Partnership Law

The Wisconsin Legislative Fiscal Bureau has published a 30-page summary of the new Domestic Partnership law in Wisconsin. The law contains several provisions related to the area of estate planning, which I addressed in a previous post Wisconsin Domestic Partnership Guide. This is an evolving issue, watch for future posts and articles.

Hospice Discussion Group for Caregivers

The Hospice Center in Fitchburg is offering a discussion group for Caregivers, that will be discussing Fears About Caregiving on August 18th at 6:30p.m. Details are available on the HospiceCare website.

On-line Pet Memorials

Today I took part in a continuing legal education seminar on estate planning for pet owners. It was a fact-filled hour and I left with updated and useful information. One new resource I learned about was the existence of on-line pet memorial web sites. You can learn more at In Memory of Pets or Heaven's Playground. Yet another example of the expanse of cyber space.

Wisconsin's Transfer on Death Deed

Several years ago Wisconsin enacted legislation allowing people to use a Transfer on Death Deed, which allows them to leave someone property outside of the probate system. It is a two part system. First, the property owner(s) executes a TOD Deed where they name a beneficiary (it must be a person, i.e. Jane Smith, rather than a class, i.e. children) of the property and record the deed with the County Register of Deeds office. Second, upon the owner's death, the beneficiary files a form with the Register of Deeds and the property is transferred to them as the new owner. This all occurs outside of the probate process. It can be an affordable alternative to a will or trust, however, it does not allow for contingency planning. Recently someone asked, can a TOD Deed be undone? The answer is yes. Wisconsin Statutes, Section 705.15(3) states in part:

The designation may be canceled or changed at any time by the sole owner or all then surviving owners, without the consent of the beneficiary, by executing and recording another deed that designates a different beneficiary or no beneficiary. The recording of a deed that designates a TOD beneficiary or no beneficiary revokes any designation made in a previously recorded deed relating to the same property interest.

Home Burials....A New Trend

Reading the NY Times today I noticed that one of the most shared articles was one about Home Burials.

Advocates say the number of home funerals, where everything from caring for the dead to the visiting hours to the building of the coffin is done at home, has soared in the last five years, putting the funerals “where home births were 30 years ago,” according to Chuck Lakin, a home funeral proponent and coffin builder in Waterville, Me.

While the average American funeral costs $6,000, those who went with a "home burial" paid as little as $250. While not all of us live on a tract of land suitable for burial, how many of us would want a coffin that doubles as a bookcase until we need it? Apparently quite a few.

Safer Homes For Seniors

Whether you are an independent senior or the child / grandchild of an independent senior, the topic of safety in the home is likely one you have or will research. Reading a recent NY Times article, Making Home a Safer Place, Affordably, I was surprised that there was not much of an industry out there for this type of service.

As Ms. Connelly learned, an entire service industry is slowly taking shape around the goal of letting people age in place. If you want to make your own home or an older relative or friend’s home a safer, more supportive place to live, here are basic guidelines to the most efficient and cost-effective approaches.

The article provides a nice overview of issues to consider when attempting to improve the safety conditions of a seniors home. If you live in Wisconsin, one resource to contact would be the Coalition of Wisconsin Aging Groups.

The Funeral Business

I saw an interesting article in the July 2009 In Business Magazine; it is a profile of Bill Cress, president and funeral director at Cress Funeral and Cremation Service. A side bar offers some interesting statistics about the funeral industry:

• US Industry Revenue in 2006 - $11 billion;
• No. of US Funeral Homes in 2006 - 21,080;
• US Death Rate in 2007 - 8 per thousand;
• Projected US Death Rate in 2020 - 9.3 per thousand

Funerals are an industry, a fact that comes across in the article. Cress is quoted as saying:

"people will always die. It's a matter of how much they'll spend."

The average Wisconsin funeral costs between $8,000 and $9,000, and a cremation costs between $3,600 and $5,000. It is probably wise to give some thought now to what you do and do not want when the time comes, rather than a time of grief.

Jackson and the Federal Estate Tax

People worry about estate taxes. Or should I say, too many people worry who should not. Yes, Michael Jackson's estate will owe estate taxes, estimated to be in the range of $80 million. However, he died with a net worth over the federal exemption....this year that is $3.5 million for an unmarried person. If your net worth (remember to include life insurance) does not exceed $3.5 million, you can stop worrying about the federal estate tax...enjoy the summer instead.

The Sisters of St. Joseph on Life and Death

The NY Times ran an interesting article last week on the approach taken by the Roman Catholic nuns of St. Joseph in New York State.

“We approach our living and our dying in the same way, with discernment,” said Sister Mary Lou Mitchell, the congregation president. “Maybe this is one of the messages we can send to society, by modeling it.”

I found the article, and the views presented to be thoughtful an interesting. It shows that the debate on end of life issues need not be so polarized -- there may be a common ground for us all.

Hospice for Pets

Yes, there are now hospice services available for the 4-legged members of our families. I recently read a nice article, with an overview of the emerging programs.

Just like in human hospice, veterinarians feel that the final days for the pet should be spent in comfort among familiar surroundings and loving family. According to Dr. Alice Villalobos, director of Pawspice in California, the goal of pet hospice is help pet owners determine the quality of life for their pets. “If the pet owners and veterinary staff can meet the basic desires at a satisfactory level,” says Villalobos, “there is justification for preserving the lives of the pets.” At Pawspice, the five “H’s” of hunger, hurt, happiness, hydration and hygiene, along with the pet’s mobility are rated each day. Of course, the goal is that the pet is having more good days than bad ones.

Wisconsin Domestic Partnership Guide

For those interested in learning more about Wisconsin's new Domestic Partnership law, Fair Wisconsin has put together a comprehensive guide. The new law will take effect August 1, 2009. Under the new law, domestic partnerships is described to be:

Domestic partnership in Wisconsin is a legal status that provides same sex couples who register as domestic partners with certain limited legal protections.

One aspect of this law that I notice is that it does NOT apply to heterosexual partnered couples; if a man and women are partnered, but not married, then there is no right to inherit under Wisconsin law. This would only occur if the parties completed a will.

Under the law, domestic partners will have inheritance rights that did not exist before (partners could inherit if one completed a will, but if there was no will, there was no right to inherit):

Inheritance and Survivor Protections - A surviving domestic partner:
• inherits from the estate of domestic partner who dies without a will;
• can be awarded the couple’s home and vehicles that are titled in the name of the deceased partner, as well as personal and household items of the deceased partner, by a probate court;
• may have certain protections against creditors;
• can transfer a deceased partner’s assets to the surviving partner without probate if the total value is less than $50,000;
• can receive death benefits if the deceased partner was killed in a workplace accident, with special benefits if the partner was a police officer or firefighters killed in the line of duty;
• can get victim compensation if the deceased partner was injured or killed while trying to prevent a crime or assist a law enforcement officer;
• can sue for a partner’s wrongful death.

Illinois Cemetery Investigation

Here is yet another disturbing news story involving greed and cemeteries; in this case, workers at Burr Oak Cemetery in Illinois are accused of unearthing bodies in an effort to re-sell burial blots. Unfortunately one is not safe from criminal behavior after death.

When selecting a burial location it is important to research your choices. Each state may differ, but all will have some office that regulates the industry. And a consumer protection office may have a records of complaints filed against a cemetery.

Eco-Coffins

Just came across an article about coffins made from banana peels, if you are looking for an eco-friendly burial, read more.

Colorado-based Ecoffins USA, sister company of The SAWD Partnership, which helped fuel the eco-conscious funeral movement in the United Kingdom, uses banana sheaves and bamboo in the construction of their coffins – materials long noted for their abundance and ability to rapidly biodegrade. The caskets, which take six months to two years to decompose, are made in a Fairtrade certified factory in China and shipped to the United Kingdom and United States, perhaps the most environmentally taxing part of the process. Interestingly, according to the company’s UK site, the caskets are “transported by sea to the UK ‘Russian-doll-style’ - inside each other, maximizing space and minimizing fuel costs” and, of course, fuel emissions.

Fiscal To-Dos

This NYTimes article talks about tackling those pesky financial to-dos that never seem to get finished. The author has extra time on his hands thanks to unpaid leave of 10 days, and decided to use that time to improve his family's fiscal health. Number 6 is "complete a will". The author has made some initial calls to attorneys, and claims that "it will be finished by summer". If you are in a similar situation, keep the following in mind:

• call a variety of lawyers and ask about pricing. Some charge by the hour, others charge a flat-fee;
• work with an attorney who specializes in estate planning and probate -- they should be more knowledgeable and more efficient;
  
• hire someone you feel comfortable talking with, it is important that you tell this person about your family structure and financial situation -- no matter how difficult either situation is;
• get recommendations from friends and family who have completed a will, or from a trusted professional you already use (accountant, financial planner, insurance person); and
• doing a basic will can take between 4 and 6 weeks, depending on how organized you are and if you know who you want to do what (guardian, personal rep, trustee).

Good luck with your to-do list!

Book: Guide to the Great Beyond

I haven't had a chance to read this one, yet, but I will. Saw a blog post on a law professors blog, and thought I would share it here. Many people are looking for books on the topic of planning for death that address emotional issues, not just legal, and this appears to offer that approach. The Book is called Guide to the Great Beyond, by Jane Brody.

Weird Wills

Here is a web site that has information on weird wills. I've linked to the page for Jeremy Bentham, a philosopher I studied in my undergraduate days. The site may offer some amusement on the rather grim topic of wills.

Read Michael Jackson's Will

Yes, once filed with the court, Michael Jackson's will became a public document. Here is a link to the will, which I found on a law professor's blog that I monitor. It is a mere 5 pages, transferring assets into a trust and nominating his mother as the guardian to his minor children; the back up guardian is Diana Ross.

An icon of the music world, but his will is simple at to the point. Naming an executor, distributing his property, and nominating guardians for minor children. His will really is no different than the typical American.

Wisconsin Same-sex Couples Will Be Able to Inherit

Legislation signed by Gov. Doyle earlier this week will grant State recognition to domestic partnerships. Reported in the Capital Times, the legislation is described as follows:

Along with the recognition come dozens of legal protections that previously were only granted to married couples, including the right to take family leave to care for a sick or dying partner, the ability to access a partner's medical records and the right to inherit a partner's property.

I'd like to clarify the article's language; under the current law a partner could inherit, but to do so the other person needed to have completed a will. Without a will, the property would have passed according to state statute, which would go to children, if none, parents, etc. The current statutory distribution did not recognize domestic partners.....it now will under the new legislation.

Since Wisconsin has constitutional language barring same-sex marriage, some have questioned the legal validity of the new law. However, the article reports:

the Wisconsin Legislative Council, foreseeing a potential legal battle, issued an opinion on May 6 that said the constitutional amendment did not preclude the legality of domestic partnerships. The opinion stated, in part, that "it is reasonable to conclude that the domestic partnerships proposed … do not confer a legal status identical or substantially similar to that of marriage for unmarried individuals."

The new law goes into effect August 1, 2009.

Death of a Thriller

Michael Jackson entertained us for nearly all of his 50 years. And, unfortunately, his death continues to be a source of attraction for millions. Attention is now focused on whether the singer died with a valid will. Current news stories report that a will from 2002 is his most recent, and may be filed as soon as July 2nd. Reports indicate that his estate is divided between his mother, three children, and various charities. While most people do not have an estate with assets and liabilities in the hundreds of million dollar range, many people do have young children.

One valuable lesson from his early death is that the only valid way for a parent to name a guardian for minor children is in a will. Through proper planning, parents can nominate the person(s) who should raise children, and who should manage the finances. This is an issue that can rip families apart. Take the time to think through the decision now, and hopefully it will never come to pass.

Compassinate Choices' Speaker in Madison

As a member of the First Unitarian Society, I receive the Madison Unitarian newsletter. Reading the most recent edition, I noticed that Barbara Commbs Lee, who is an activist with Compassionate Choices, will be speaking at the Society on July 12th. Compassionate Choices is a national right-to-die organization, with a local chapter. Lee's speech is entitled "Death with Dignity, Religious Freedom and Authentic Wholeness". This is an important and controversial topic, if you would like to learn more you may want to attend the service at either 9am or 11am on July 12th.

Bid on an Estate Plan!

Regularly I donate my legal services to charitable organizations. This year, as in the past, I have donated a gift certificate for 50% off an estate plan, with a limit of $150, to the Angel's Wish Auction. Here is a great opportunity to be charitable, and take care of your estate plan. It can be used towards a will, trust, or powers of attorney. You must be over 18 and reside in Wisconsin. Good luck bidding! To view all items up for auction, click here. The auction ends June 30th at 5pm.

Why Angel's Wish? Our two cats were both adopted through the organization, and it is one way in which I give back to a wonderful non-profit.

Will of Michael Crichton

The author of Jurassic Park, Michael Chrichton, died last year and his estate is possibly more interesting than his books. One daughter, a son born 3 months after he died, 4 ex-wives, and a widow. Hollywood lives may be extreme, but a lesson learned from this case is to make sure a will mentions children born or adopted after the will is executed. Yes, his will mentions his daughter, but not his son. For more, visit Portfolio.com.

Parents, Children, and Trusts

When I work with parents who have young children, I usually recommend that they create a testamentary trust. This is a will, but it also has a trust embedded within it. If both parents die (or the parent in a single-parent home), a trust comes into existence. There is a nice summary of why a testamentary trust works well for families with young children on a web site I monitor. As always, it is best to consult with an attorney before creating any documents. Usually, if you take the time to explain your situation to a professional, and you'll be pleased with the end result.

Green Cemetery

Interested in an eco-friendly burial? Have you considered a green cemetery? Many people find the idea intriguing, however, the effort to bring a green cemetery to Wisconsin (or the Midwest) still needs help. I serve on the Board of Advisors for the Trust for Natural Legacies. The organization is still conducting a land search, but hopes to have a functioning green cemetery soon. To learn more about TNL and green cemeteries, check out the most recent newsletter.

Five Wishes

Often I will have clients or seminar attendees who ask me about the Five Wishes form. This is a form that is designed to take the legalese out of advance directives. Yes, it may be easier for the person to understand....but according to this blog post, it may also deminish the legal effect of the document. These documents may initially make estate planning more affordable, but not if in the end you need to hire a lawyer to do a guardianship or litigate a form. As I often say, it is less expensive to bring a lawyer in to set something up then to hire one to clean up a mess.

If you are thinking about advance directives, good for you. Just make sure you are investing your time and money into something that will hold up if needed.

Long-term care insurance via the government

In this AP story, it appears that Senator Kennedy has proposed that working Americans can purchase a long-term care insurance policy from the government. The plan would cost $65/month, and pay (after 5 years) not less than $50/day.

Interesting idea. We'll have to see what comes out of Washington when all is said and done.

A Decline in Charitable Giving

Giving USA reports that charitable giving to all kinds of non-profits was down 5.7 percent in 2008. No surprise given the state of the economy. Despite the drop, Americans still donated $307 billion. NPR has a nice article on the topic. Giving may be down from the year before, but Americans still appear to be donating a large sum of money. As I previously wrote, if you are considering a donation, you may want to use www.charitynavigator.org to evaluate the organization.

Fees for TODs and PODs?

Reading listserve emails for the elder law section of the State Bar, I noticed one that said a client was just informed by a large brokerage house (unnamed) that they would now be charging fees for TODs (transfer on death). These forms, basically a beneficiary form, allow a person to name a person or persons who should receive the asset upon death. The beauty of these forms is that they (usually) allow a person to avoid probate....the assets transfer upon death. All that is needed is a death certificate and a form from the company. But, in this world of squeezed financial markets, fees appear to be popping up. The unnamed firm is charging $75 to have the form completed, $50 for each change, and $200 when the person dies.

I'm a frugal person, and this is not common practice...or at least it hasn't been. My advice, shop around for another broker. If they are charging for this, what else are they charging for?

Stolen Headstone at Forest Hill Cemetery

Apparently, not even the dead are exempt from theft. Madison.com reports that a Janesville man visited his family's plot at Forest Hill Cemetery (located in Madison, Wisconsin) only to discover a headstone missing.

This raises a question I don't know the answer to -- who is responsible for paying to replace the headstone? To answer the question I would want to see the contract, but who would have it? Might there be one on file in the cemetery's business office? Or possibly the personal representative kept the contract. That is one think I really enjoy about the practice of law, new questions are always emerging, and discovering the answer is a great way to learn something new.

Feuding Over Inherited Packer Tickets

Prized possessions, every family has them. In Wisconsin season tickets to the Packers certainly ranks high enough in value to be included in an estate plan. Walter Christmas apparently turned to a trust in an effort to pass along the tickets, and any value, to his sons. Unfortunately, the trust agreement has not stopped feuding between his sons. I've included a link to the story of two brothers feuding over inherited Packer tickets.

Many clients think that a trust is a trouble-free way to leave possessions to family. As this story shows, trusts can't prevent family feuds.

What Are Donor Advised Funds?

Here is a great, concise snapshot of donor advised funds. For some, this is a great way to work charitable giving into an estate plan. See the drawbacks listed before making any commitments.

Advance Directives

Yesterday's New York Times ran a chilling article, Kept From Dying Partner's Bedside, which is about a same-sex couple that was kept apart while one was dying in the hospital even though the couple had created powers of attorney. The article mentions that when the healthy partner was told she'd need a health care proxy, she had to contact someone and have it faxed to the hospital where the couple and their children were vacationing. Often I have seminar participants ask if a power of attorney for health care is valid if the person is traveling in another state. The answer is yes, if it is valid in the state you live, the other state should recognize the document.

This story is quite troubling, and will be one that I follow. Reading it, the one thought I have is that if you are in a relationship that is not traditionally recognized (same-sex couple or partnered but not married), you might want to have the documents in hand when you travel. Maybe it wouldn't have made a difference in this case, but time can be of the essence.

Radio Program - Facing Death

This past Saturday Public Radio's To The Best of Our Knowledge ran a show titled "Facing Death". The first segment explored the question of whether aging, and thus death, can be stopped. The interview subject claims yes - just as we can keep machines like cars running for years, we should be able to do the same for the human body. Other segments focused on books related to dying and surviving near death experiences.

I listened as I drove to client meetings and found the show to be interesting....and I plan to read at least one or two of the books mentioned.

You can hear the show by visiting To The Best of Our Knowledge.

Wizard of Oz Actor's Heirs Sue

Sadly, Mickey Carroll, one of the last surviving munchkins from the Wizard of Oz died recently. Shortly before his death he signed papers giving his long-time friend and caretaker power of attorney. Now his heirs have filed suit to freeze assets, claiming misappropriation.

This story show that even if you take steps to put your estate plan in order, infighting can occur. To assure that your wishes are followed be certain to seek legal counsel who specialize in the area of estate planning, and who should be looking to make sure undue influence is not occurring.

Pet Trust Star Trek Style

Gene Roddenberry's widow, Majel, recently died and set up a pet trust. Yes, it is another high profile, high funded trust. This one leaves $4 million to her dogs. And the son of Gene and Majel, well he is well taken care of as well. For more details, click here. My husband is a huge Star Trek fan, and is delighted that the latest movie opens on his birthday. We've already bought tickets, so in a way, we are doing our bit to make sure the creator of Star Trek's dogs stay living in the manner they have grown accustomed to.

Pet trusts are not just for the rich and famous. Whether you need a trust to care for a pet after your death, or not, planning for the care of an animal is very important. Too many shelter animals arrive because of an untimely nursing home admission or death. Please take the time to consider who should take over for you if you cannot conitune on as your pet's guardian.

Free Seminar - Do Your Own Will

Thursday, May 14, 2009, at 7pm, I will be speaking on the topic of how to do your own will and other documents. The seminar is through the University of Wisconsin Extension, Financial Education Center. This seminar is FREE and open to the public. To register for the session, please call 608-261-5077.

If your company or organization would like to offer a similar seminar on wills and other documents, please contact my office at 608-274-7192 or email me at melinda@gustafsonlegal.com

Dead Hands: A Social History of Wills, Trusts, and Inheritance Law

Yesterday I ordered a copy of Lawrence Friedman's new book, Dead Hands: A Social History of Wills, Trusts, and Inheritance Law. It is summarized nicely here, and is a bit too new for book reviews. I first read Lawrence Friedman in undergrad, taking a law and sociology class. He is a wonderful writer, who can weave the legal world into a social context. I'll be posting future updates once the book arrives in my mailbox.

Tips on Being Charitable

I came across this NY Times article and thought the tips on how to be charitable with non-profits were practical and wise. Key concepts are to be flexible, think about the long-range, and choose an institution you can trust.

Trustees Get to Decide Helmsely Trust Distribution

Recent news reports indicate that a New York court has ruled that the trustees of the Leona Helmsley trust have sole authority to distribute trust assets. $1 million will go to dog related charities, the remaining $135 million to hospitals and medical research.

This article illustrates that courts can, and do, get involved with trusts. Often times clients want a trust, saying they want to keep the courts out of their business. Unfortunately, that is not always the case.

Body Donation Program

Recently I worked with some clients on an estate plan, and part of the process was to help them coordinate donating their body to research. The opted to work with the University of Wisconsin Madison, School of Medicine and Public Health, Anatomy Department's Body Donation Program.

Wisconsin law allows a person, while living, to arrange to donate his or her body to a medical school as long as the donation is for educational purposes. At the UW, once study of the body is completed, the remains are cremated. Ashes may be returned to the family if designated forms are completed. According to the school, it is normally two years before the ashes are returned. Ashes that are not returned to the family are buried in an unmarked grave on University property.

To ask additional questions or obtain a donation form, contact the UW at 608-262-2888.

Morbid Facts on the Web....Dead At Your Age

There was an odd link on a blog I read regularly. Mixed in with posts about taxes, the business of law, and estate challenges was a link to a web site that will determine what famous people you've out lived. It's tax day, so I thought I'd share the link....the oddness might take your mind off of taxes.

Check out Dead At Your Age here.

April 16th - Health Care Decision Day in Wisconsin

Governor Jim Doyle has declared April 16, 2009, to be Health Care Decision Day in Wisconsin. The idea is to raise public awareness of the need to plan ahead for health care decisions related to end of life care and medical decision-making whenever patients are unable to speak for themselves.

Basic forms are available on the Wisconsin Department of Health Service's web site. As always, I recommend you consult with an attorney specializing in the area of estate planning to ensure that your paperwork is accurate, complete, and compliant with Wisconsin law.

Right to Die Laws

This month's edition of Wisconsin Lawyer Magazine's cover story is Society's Challenge: Finding A Better Way To Die. No, not the happiest of titles, but an important topic nonetheless. William H. Colby provides a re-cap of the current case pending in Georgia, presents a nice history of right to die laws, and offers his thoughts on the need for discussing this delicate subject.

In 1969, as technology was beginning this advance, a lawyer in Chicago had what was then a fairly radical thought: What if a person might want to say “no” to a doctor but can’t speak? The lawyer knew that the law provided a method to dispose of his property when he could no longer speak, when he was dead: a document called a will. He came up with the idea of writing on a piece of paper, “If I’m ever in a coma, I don’t want my life prolonged artificially by machines.” He called the paper a living will and wrote a law review article about the idea, and the societal debate began.

Colby continues by pointing out that 100 years ago society did not possess the ability it has now to prolong life. As a result, a new set of questions arise. Here are his thoughts on talking about this issue:

So how do lawyers advise clients, family members, and friends who ask, “Hey, what should I do about my living will?” My own solution may not be the gold standard, but I’ve thought a lot about the intersection of law and medical technology. Here are the three steps I’ve taken for myself.

• First, I filled out a legal document, a one-page power of attorney for health care. This document states that my wife (or the listed alternates) will make medical decisions for me if I cannot.
• Second, I’ve armed my wife to act as my advocate if necessary. We’ve talked about Terri Schiavo, and my grandmother’s Alzheimer’s disease, and other situations. My wife knows that I believe the purpose of medical technology is to serve as a bridge to recovery so that I can live life. If it cannot, I want it stopped.
• Third, I’ve talked with my siblings, my doctor, and other people who might be in the room when decisions are made about me. Health-care workers who deal with the dying all can tell a story about the somewhat-estranged adult child who flies in to “save” mom. To avoid conflict later, talk now.

Colby will be debating the Constitutional, legal, and medical impact of the right to die at this year's Wisconsin State Bar Annual Convention, May 7th, in Milwaukee.

Estate Tax vs. the Death Tax

Regardless of which camp you place yourself in on the issue of estate taxes / death taxes, the topic is getting more press in recent weeks. President Obama has proposed freezing the tax at its current exemption level ($3.5 million for individuals, and $7 million for married couples). But now members of the Democratic party are joining forces with Republicans to set the exemption even higher, $5 million for individuals and $10 for married couples.

But now some Democrats have joined Republicans to call for setting the threshold even higher, in a rebellion that could have important consequences not just for the future of the death tax but also for Mr. Obama’s efforts to pay for his ambitious policy agenda.

The NY Times ran a nice article addressing both sides, and offering some good examples about the real number of individuals/farms/businesses that would likely be impacted by the tax. It seems everyone has an opinion on this issue, but a very tiny fraction of Americans would actually have an estate subject to the tax.

When Minutes Matter

I borrowed this post title from the cover story in today's Cap Times. Fast Action Saves a Madison Toddler From Potentially Fatal Brain Injury is a compelling story, and one I think all parents should read. As the mother of a 8 month old, I naturally worry about falls and tumbles. While serious injury is rare, I encourage readers to take the time to read this article. It even mentions Garrison Keillor's brother, who I recently wrote about in Garrison Keillor In Madison to Honor Brother. Investing a few minutes in reading the article will help you understand when a minor fall may have severe implications.

Reading these stories made my legal mind kick into action, knowing that too many people do not have their powers of attorney completed or updated. Accidents happen. We never know when a lazy morning will turn into a life threatening situation. You can never be fully prepared, but you can make sure that you have completed the documents stating who should make your decisions for you if you cannot. If you have questions about this process, be certain to talk with an attorney who focuses on estate planning and related issues.

When Parents Remarry

Love is a wonderful thing, especially when it is found later in life. However, when parents enter into marriage it can have implications on a child's inheritance. In Wisconsin children do not have a right to inherit, however, some parents may not realize the ramifications of re-marriage. Smart Money magazine tackled this issue in its April 2009 edition. Before Your Parents Say "I Do Again" profiles several families and the inheritance wars that were started in blended families. The article is interesting and raises some good questions. As always, I recommend that all people seek legal counsel from an estate planning attorney in their home state -- we have 50 different states and 50 different sets of estate planning laws.

Hospice Seminar

I received a notice today about a seminar offered through Rock County's Hospice Office -- it is aimed at helping your aging parents, and yourself. The seminar is offered the evening of April 14, 2009, and is described as follows:

What community resources are available to help you help your parents find the assistance they need as they age? If you are struggling with Medicare, housing or healthcare, find out how to access local resources and organizations and discover solutions for family caregivers who are caring for aging parents, relatives or friends. There is no registration for this free seminar.

For more information, visit Hospice's web site.

Garrison Keillor In Madison to Honor Brother

I read in today's Wisconsin State Journal that Garrison Keillor will hold a show in Madison, at the Overture Center, in honor of his brother and for the benefit of the Tenney Park Shelter. A similar story ran in the Minneapolis paper. The show will be held May 6, 2009.

Not everyone can honor a brother this way, but Garrison's words express the feelings of many:

When your brother dies, your childhood fades, there being one less person to remember it with, and you are left disinherited, unarmed, semiliterate, an exile.

Is it time to review your estate plan?

Roughly 50 percent of American do not have a will, which means the other half do. Having completed a will is not sufficient, one must review the documents periodically to make sure things still make sense. What is periodically? I advise client that it is every 5 to 7 years, or earlier if you've had a major life event (change in marital / partner status, birth of a child/grandchild, or a death in the family).

Recently the New York Times ran an article, Smaller Though It May Be, It's Time To Look At The Estate, about the wealthy, who are concerned with estate taxes, who are getting up the nerve to review estate plans following the financial crisis. One sentence jumped out at me, and it is worth sharing:

The primary goal (of estate planning) has always been how to bequeath what you have to the heirs you picked. And if handled wrongly, wills can become a vehicle that destroys families.

As the article says, whether you have $50,000 or $5 million -- make sure what you've taken the time to put in writing still makes sense....and is not too vague.

As always, it is best to consult an attorney who specializes in estate planning and probate.

Recessions and the Funeral Industry

Sunday's Wisconsin State Journal included an article in its Personal Finance Section from the Seattle Times titled In These Hard Times, Even Funeral Industry Is Suffering. The article presents some insight into the more cost-effective option of cremation.

All too often a person's passing is unexpected. One way to ease the shock and burden of an untimely death is to discuss the options that exist for funeral and burial. Discussing it know, and making some plans, will save your loved ones time, money, and grief in the future....hopefully long off in the future.

Funerals Go High-Tech

I recently discovered a new blog, and here is an interesting post on webcasting funerals. The idea may hold appeal for certain families who have relatives and friends spread across the globe. I hope this is a useful link.

Death and the Digital World

Some time ago I blogged about on-line estate planning tools, and recently I came across yet another new web site. Launching in April 2009, Legacy Locker aims to help you pass along your digital property to your loved ones. Facebook pages, Amazon accounts, and countless other services. I can't tell from the web site, but you may be able to preserve digital photos and other media.

There always seems to be a new web site, melding ways of the past with technical savvy. But this web site also serves as a reminder that we do all have some digital presence, some more than others. When doing an estate plan, don't overlook these items.

Learn More About Green Burials

The following article appeared on a blog that I read daily, and it seemed like something that might interest my readers.

Lately, there has been a movement to educate consumers of alternative burials. One such movement asks consumers to consider a “green burial.” A green burial is aptly named because it aims to provide ecological soundness.

Green Burials -- what are they and why might you want one? To learn more, I recommend reading Green Burials: What Are They and What Are Their Advantages?

The Undertaker's Tale

When you blog about illness, death and taxes it is nice to throw in a piece that is upbeat every now and then. Even though he has been dead for years, Mark Twain will publish a new story -- The Undertaker's Tale. According to the LA Times,

The never-before-published story "The Undertaker's Tale" by Mark Twain will finally see print next week, in the pages of the mystery quarterly The Strand Magazine. "Twain uses his razor sharp wit to pen a tongue-in-cheek tale about the funeral industry," says editor Andrew Gulli, "which could easily have been written today."

I'm not sure if the story itself is upbeat, but a never read story by Twain is always a treat. Happy Reading!

News on the New Estate Tax

Recently I posted a blog up upcoming changes to the federal estate tax, no specifics have been worked out yet, however, the NY Times recently ran an article reporting on the likely changes to the federal estate tax law. And the article includes a nice overview of bypass trusts, family trusts, beneficiary forms, and a reminder to review your estate plan every 5 years.

Estate plans should be reviewed at least every five years, more often if there’s a change in finances or circumstances — if health or marriage takes a turn for the worse, or if there’s a birth or death in the family.

The article also mentions the importance of making sure your beneficiary forms are up-to-date, especially given the recent number of mergers, acquisitions, and failures in the financial sector. Remember, what is listed on a beneficiary forms controls, not a will.

Whether your family would be impacted by federal estate taxes or not, it is truly a gift to leave your loved ones by making sure your papers are in place, up-to-date, and organized.

If you are uncertain about the area of estate planning, I encourage you to seek the counsel of a skilled attorney -- don't rely on blog postings for legal advice, they are merely a place to get discussions started.

Debt and Death

The death of a loved one is a difficult time, and often made more complicated when the deceased left behind debts. Today's New York Times ran an article on debt collectors who specialize in collecting monies owed by the deceased. The article implies that these companies are aggressive, often making surviving loved ones believe they are responsible for the deceased's debts.

In some instances there may be liability by the survivors, for example in a marital relationship or if someone co-signed on a loan. However, you should research your rights and obligations before paying bills of a loved one who has passed.

This story also underscores the importance of doing a probate, even in small estates. The probate process involves giving notice to known and unknown (via newspaper notice) creditors, giving them a set time frame to seek repayment. Probate is the proper venue to discharge all debts owed by the deceased. Probate is not as difficult as many people fear, and it can be completed with or without the assistance of an attorney -- depending on where you live. In Dane County (Wisconsin), the probate court has all of the forms on-line.

Seminar - Planning a Funeral

I came across an announcement for a local seminar on planning a funeral, presented by Hospice. The announcement says:

People must often plan a funeral when they are least prepared to do it—right after the loss of a loved one. You can help your family avoid this by learning about the many decisions involved in a funeral at this free question-and-answer seminar. No registration is necessary, and there is no charge to attend.

For more information, click here.

Assisted Suicide

Debate over assisted suicide is taking shape once again in this country, this time in Atlanta, Georgia. This case involves the head of Final Exit Network, a group that serves organization dedicated to serving people who are suffering from an intolerable condition. The article also mentions the other side of the coin, Not Dead Yet is a group that opposes legal assisted suicide. As our population continues to age, the debate over assisted suicide is likely to continue on.

Ledger Wins, Oscar to be Held in Trust

Here is a quick update on my last post -- Heath Ledger won a posthumous Oscar for his performance in the movie Dark Knight. It appears that the statuette will be held in a trust, for his daughter, until she is 18. At that point she'll be old enough to sign a contract with the Academy promising to sell it back to them first, for $1, before selling it elsewhere.

Thanks to the Wills, Trusts & Estates Prof. Blog for this update.

And the Oscar Goes to.....Matilda's Trust?

The news surrounding the untimely death of actor Heath Ledger is sad, and contains a powerful reminder. When a child is born, update your will.

In the Ledger case, he had created a simple 3 page will in Australia before becoming famous...and before becoming a parent. The will left everything to his parents and siblings. News stories indicate that his family has given up the $20 million estate, which went to his 3 year old daughter.

The story continues to evolve though; nominated for an Oscar, the question becomes, what happens to the statue is he wins? Yahoo News has a nice story detailing the plan to have the Oscar held in a trust until his daughter reaches 18 and can legally sign a contract indicating that she won't sell it on the secondary market.

Sunday we'll find out if he wins, and a trust would be created. Enjoy the awards show.

Treating Children Unequally in Your Will

More often than one may predict, I find myself advising clients on how to handle their desire to treat children unequally in a will. Whether it be because one child received extra assistance (i.e. money to start a business) or if a child has provided significant care to the parent without compensation - it is not that uncommon for parents to vary the distribution to children in a will.

The New York Times ran an article titled "Learning to Share" by David Cay Johnston in September 2008. He wrote:

Unequal distributions, however sensible they may seem to parents, often dredge up sibling rivalries. Claims that a favored child exercised undue influence over a parent, especially an aged parent, can find their way to the courthouse, where defending the will takes its toll through legal fees.

If you are thinking about treating your children unequally in your will, I recommend you read his article and consider his suggestion -- approaching the kids while you are still alive. Especially those with a smaller share.

To Give or Not to Give - - Evalute a Charity First

Even in these dismal economic times, many people are still donating to charities. Or, people are thinking about making a planned gift, one that is realized upon death and is written into a will or beneficiary form. With so many good causes and organizations to support them, a person can be overwhelmed in deciding where to donate. One option would be to assess the charity in mind; does it spend a large proportion of its budget on administrative costs? A newspaper article alerted me to a web site that allows people to evaluate a charity's financial health -- it is called Charity Navigator and rates organizations based on the IRS 990 forms (similar to an income tax return).

I encourage you to visit the site and research an organization you are interested in. The site has list of the 10 organizations that are in the red, those that have sky high adm costs, and those that are doing wonderful.

Workshop on Natural Passings

Earlier this week I received the Winter Newsletter from the Trust for Natural Legacies, where I serve on the Board of Advisors. One upcoming event seemed appropriated to mention on this blog:

Natural Passings: Reclaiming the End of Life. An ongoing conversation
March 27th, 28th and 29th, 2009
A grassroots look at Death, Dying and Burial, in a weekend workshop that will introduce participants to: green burials, consumer rights, ethical wills, home funerals, options for funeral ceremonies and alternative ways of interring our loved ones.

Families and caregivers deserve meaningful participation in and support for handling the end of life. Come join the conversation. Come prepared to be informed, empowered and inspired.

Held at:
McKay Center Auditorium
UW Arboretum
1207 Seminole Hwy, Madison, Wisconsin.

Click here for more details.

Rent After Death

Earlier I wrote a post titled Renting Fact, which discussed how a person is still responsible for paying rent after death. Sadly, a news story out of California shows how that fact plays out in reality. If you are working to close out a relatives estate, don't overlook the rent that might be owed. Hopefully the landlord involved would be more forgiving and cooperative than the one involved in this story.

When she died on Christmas Eve with eight members of her family, Alice Ortiz unwittingly broke the lease she held on an apartment in Upland.

Now the landlord, Broadstone Foothill Apartment Homes, wants its money, $2,821.23 in all, according to documents obtained Wednesday.

A Jan. 29, itemized invoice to Ortiz's survivors claims the dead woman's estate owes $1,655 to the apartment complex on North Central Avenue for "insufficient notice to vacate."

Estate Planning On-Line Tools

Earlier this week a client shared with me an article he'd clipped out of the New York Times in the fall of 2007. Entitled Online, a Way to Say What You Wouldn't Put in a Will, the article profiles three internet companies that allow customers to store passwords and other data as well as send a letter of final instruction.

Any way a person can organize his or her affairs, especially financial passwords, is a good idea. For the tech savvy, this might be an option to learn more about. The three companies mentioned were:

• YouDeparted.com
• PrivateMatters.com
• LetterFromBeyond.com

I'm curious to hear about people's experiences with these sites or others. The world is increasingly moving into the cyberspace, and it will be interesting to see how estate planning and probate are impacted.

US Supreme Court Rules on Beneficiary Forms

The U.S. Supreme Court said in an opinion issued January 26, 2009, (Kari Ellen Kennedy v. Plan Administrator for DuPont Savings and Investment Plan, et al., No. 07-636, U.S. Sup.) that a plan administrator correctly ignored a divorce decree and distributed the assets to the person named on the beneficiary form....the decedant's ex-wife.

The case involved the daughter of the decedent, who sued her mother because the mother was listed as the sole beneficiary of the father's 401k account. Even though he had divorced the mother, the mother's name was never removed from the beneficiary form. The daughter claimed that her mother waived her right to the account balance by the terms of the divorce decree, however, the US Supreme Court disagreed.

As I always tell my clients, a will does not trump a beneficiary form. The best practice is to review those forms regularly, making sure they reflect your wishes and are up to date.

A Good Death - Wisconsin Public Radio

To the Best of our Knowledge featured an hour-long show entitled A Good Death, which features several books that may be of interest to those working on an estate plan. WPR describes the show as follows; links to the books are included on the WPR web site:

The first segment features David Rieff, who wrote an account of his mother's last days. It's called "Swimming in a Sea of Death," and tells how he tried to do the right thing by his mother - Susan Sontag - while also being true to himself. The second segment is described as an interview with David Shields the author of "The Thing about Life is that One Day You'll Be Dead." He talks with Anne Strainchamps about his book, which is a meditation on how our bodies decay and die, and his irrepressible father who is 97 and who doesn't give death the time of day.And the final segment features Pauline Chen, a transplant surgeon and writer. Her book is called "Final Exam: A Surgeon's Reflections on Mortality." She talks with Jim Fleming about her medical training and how ill prepared it left her for dealing with issues like grieving families.

Wills and Personal Momentos

The following letter appeared in today's edition of Dear Margo. It illustrates several points I try to make to clients and seminar attendees about the dynamics of doing a will:

01/16/2009 – DEAR MARGO: My family is at their wits' end with a major upset, courtesy of my grandparents. They have decided to leave everything (down to the dust on the floor) to their church, where my uncle is the pastor. My family is not upset about the money (there really isn't that much). It is more the personal items that have sentimental value. We cannot be 100 percent certain, but we think that my uncle had this planned all along and was just waiting for the right time to manipulate my grandparents. He will receive it all, and he has power of attorney, as well as being the executer. He has yet to face the family and explain why he felt the need to have it all, and my grandparents are so convinced this is the right thing to do that they can't see how this is tearing everyone up. My mother is a wreck, as her parents have left her nothing to remember them by. She was promised personal trinkets (worth nothing to anyone else, but worth the world to her because of the memories). I am only a granddaughter, but I was promised my grandmother's button collection, which will probably be sold at an estate sale for a few bucks. My grandparents refuse to discuss it. I live out of state and am hearing everything by phone, but I'm trying hard to keep it together for my mom. She is not angry but hurt. Is there a way we can still receive these items? Is it wrong to pursue this? Is it wrong to ask for some small mementos?

--- LONGING FOR BUTTONS

DEAR LONG: In some situations, not all the children pay attention to elderly parents, so the attentive one is favored in the will. I don't get the idea this is the case in your family. Whether or not your clergyman uncle made it his project to inherit everything we do not know. In addition, you don't say whether or not your grandparents are of sound mind. Because the old folks are not interested in discussing this, my only suggestion would be to ask your uncle, when there is an actual estate to be divided, if he'd consider letting various family have mementos that were promised. Perhaps he could be reminded of tthe Good Book's dictum that it's better to give than to receive.

After reading this letter and response, I'd like to offer the following:

• One, many people think they don't need a will because they have little money. However, as I tell clients or people attending a seminar, it is often the little personal items that mean the most to family members....and trigger disputes. I encourage them to think about who should have their wedding bands, family photo albums, or Grandpa's hunting rifle.
  

• Two, this article points out that no one has a right to inherit from another person (with the exception of a spouse in states with marital property laws). The letter and response do not mention the fact that the grandparents may be close to their church or son, and somewhat estranged from the other family members.
  

• Third, the letter says that the "church gets everything" and that the pastor uncle is the power of attorney and personal representative. It is very common for these two roles to be filled by people who live in the same area, it just makes life easier. And if the church receives everything, that is different from the uncle receiving anything, it is a charitable donation. The idea may be to sell all of their personal items to generate cash for the church.

• Fourth, the family is free to purchase items they would like to keep. Yes, this may seem cold, but it may be the easiest way for the grandparents to distribute items....there would be no obvious favorites.

• And fifth, most likely a lawyer was involved in drafting the will. An attorney should take care to make sure that the grandparents were of sound mind and not being influenced by the pastor uncle.

The tension expressed in the letter is not isolated to a few families, but is rather rampant in society. I encourage people who struggle with the emotional side of estate planning (i.e. which daughter should be my power of attorney?) to read the book Creating the Good Will, by Elizabeth Arnold.

Have a Story to Share?

The following ad came across on one of the blogs I monitor related to estate planning. Apparently CMJ Productions is developing a documentary on wills in America. I emailed the contact, and she promptly sent me her firm's web site. It looks legit, but I always recommend using caution when responding to internet ads. Here is the ad:

I'm a researcher working on a documentary series about people's first-hand experiences with a family will. The project is being produced for a major US broadcaster. The documentary explores various, unexpected family issues surrounding wills. We would like to showcase the powerful, true-life stories of family wills, in an effort to create a deeper awareness of the difficult subjects of legal wrangling, conflict, grief and deep-seeded dynamics that can often arise when the will of a loved one is read. If you're interested in helping others reach closure on their feelings concerning a past will, or want to make sense of your own experience with a will, I would be very interested to hear your personal story. Thank you very much for generously sharing your story with me. You can email me - Katherine - at: storiesthewill@gmail.com

Update on the Federal Estate Tax

According to the Wall Street Journal, President-elect Obama and Congressional leaders plan to introduce legislation freezing the federal estate tax at the 2009 level. Under law passed during the Bush Administration, estates below $3.5 million were exempt from federal estate taxes during 2009. However, in 2010, the law exempted all estates for one year. Then in 2011, the exemption was scheduled to return at $1 million. According to the WSJ, the Senate Finance Committee will act within weeks to repeal the old law, freezing the exemption level at $3.5 million. Next month President-elect Obama is planning to detail his estate-tax preservation proposal in his budget.

The article provides an excellent history of the federal estate tax in the United States. This topic is certain to get continued press coverage, and generate a fierce debate. While only 2 percent of deaths result in the federal estate tax being paid, small business owners, farmers, and wealthy families have an organized effort to eliminate the tax permanently.

And stay tuned for news about whether Wisconsin will bring back its State estate tax. There has been discussion about bringing the State estate tax back as part of the effort to balance Wisconsin's budget.

What does this mean for you? If you have a net worth (and your life insurance may be included in the calculation) over $1 million you should follow developments in Madison and DC. And if you have a net worth over $3.5 million, you may want to review and update your will and or trust.

The Personal Side of Estate Planning

There is more to completing a will than figuring out who gets your house, retirement, and other savings. Have you thought about who should have your wedding band, family photo albums, your grandfather's hunting rifle? People often overlook the importance of family mementos that mean a lot to younger generations, and can cause disagreements after a loved one is gone. I've found an excellent book, written for non-lawyers, that walks the reader through these important questions -- Creating The Good Will: The Most Comprehensive Guide to Both the Financial and Emotional Sides of Passing on Your Legacy by Elizabeth Arnold. I have a link to the book on my web site.

Silver Alerts -- Legislator Aims to Protect the Elderly

Wisconsin Public Radio ran an interesting story this morning; a Wisconsin Legislator is introducing legislation to create "silver alerts" in the State. Similar to Amber Alerts, these public service announcements would alert the public to a dementia patient who has gone missing. Piggybacking on the current Amber Alert system means that there would be no added expenditure to create this program.

Click here to listen to the broadcast, and you can click here to contact your representative to share your thoughts on this piece of legislation.

I'll post updates as the legislation progresses.