Wednesday, November 19, 2014

The Boys

Somehow I held back the tears, the ones brimming in my eyes, sobs wanting to escape my throat. Somehow I held back, somehow I keep calling -- can you help me find a home for The Boys?  It was January 2014, what locals here in Wisconsin will remember as Polar Vortex season, and my mother was dying.  What would happen to The Boys, her kitty cats?  With three cats of our own, two of which were seniors, plus two young children and a dual self-employed couple -- our home was not a viable option.

Sitting in my car, with illumination from the lamp post in the parking lot of the building I was scheduled to speak at in less than 30 minutes. Channeling my estate planning attorney self, quieting the daughter inside, I kept calling.   Our local shelter, a local feral cat rescue, our family vet.  The answer over and over, sorry we cannot help.

It was my family vet that told me, ever so gently, that if The Boys went to our county animal rescue they would likely be put down after a week.  Two twelve year old males, both with health issues. Adoption was unlikely, especially if they were to be kept together.  My mother was fading in hospice care, and I was desperate not to deliver her beloved cats to kitty death row.  I could not change my mother's fate, but I could help the two cats my parents had both adored in life.

It was our cat sitter, who I refer to as Saint Angela, that opened her heart and home to The Boys. And I opened my wallet, offering to help her each and every month to cover medical and medication bills for their lifetime. Pet lovers -- have you ever asked what will happen to your furry four-legged friends?  Whether your animal companions are dogs, cats, birds, snakes, or backyard chickens -- who will be there for them?  How will their vet bills, food, grooming, etc. be paid for?

Looking back at my mother's situation, I would have made two recommendations.  First, have a distinct paragraph in her power of attorney for finance related to expenditures for her pets.  A power of attorney allowed me to act for her in a financial capacity, and pets are actually someone's property. Remember, one may be sick for an extended time, likely moving to a facility where pets are not allowed.  Second, her will could have contained a pet trust -- a small trust, created at death, to hold both the animals and a small amount of cash from which to pay future expenses.   

Typical mass-produced estate planning materials talk about generation skipping taxes, the benefits of living revocable trusts, how to create a foundation. In reality, most of those issues are not a concern for middle class Americans.  Yet, as of 2012, 62 percent of households had at least one pet, making planning for your pets care an important issue to address.  Even a simple plan would be better than nothing.   Survey friends and family about who would be willing to open their heart and home. Display your pet's veterinarian's phone number, and note any special foods or medications a pet is prescribed. An ounce of planning today will make a huge difference if and when your pet needs a new home because you are no longer able to provide one.

aka The Boys

Friday, September 12, 2014

Nominating a New Estate Planning Term - Goat Rodeo

So, you’re telling me I am better off just managing this Goat Rodeo?  A rhetorical question posed by a client some months ago in follow-up to our one hour discussion about the ins and outs of the 1986 trust the client's parents had created.  Yes, that is one way to put it. This may go down as my most humorous and enjoyable client meeting of 2014. Goat Rodeo -- what a perfect way to summarize the state of affairs.

If you are an adult child, chances are one day you may manage the "Goat Rodeo" of your parents’ estate.  There may be a trust, a will, nothing at all.  Documents may have been written 25 years earlier, designed and mandated to follow outdated tax codes.  No will?  No worries, a distribution plan is embedded in the state statutes where your parents lived/died.  You will quickly learns the ins and outs of this plan.  If you have sibling, prepare yourself for a flash back to the fights you had as tweens (was that even a word when you were a tween, most likely not).  Bottom line -- accept today that you will one day manage a "Goat Rodeo", and then go on about your life.  Your parents’ estate plan is their estate plan.  It is not yours to create, change, tweak -- just manage it, Goat Rodeo or not. For now, enjoy the time you have with your parents - time passes quickly.

Image taken by author at a petting zoo, not a Goat Rodeo

Wednesday, August 6, 2014

'Tis A Gift To Be Simple.....And When It Is Not.

It never fails.  New clients walk into my office and sit down for our first meeting of the estate planning process.  Once the initial hellos are finished and the legal services agreement reviewed and signed, we get down to business.  Nine times out of ten I hear "oh, this will be simple, we are a solid middle class family." Instantly this Shaker song pops into my mind (one I adore and delight in signing at our UU church).

The song makes me smile, such a happy little ditty.  The client(s) is smiling, thinking this will be simple because they do not have tons of assets, just the normal amount of a normal person or couple here in the heart of the Midwest.

A glance at their questionnaire and the tune fades from my mind, replaced by something for chaotic. Something more ominous.  Something that is anything but simple. Something along these lines:

Why the change in background music?  It's simple really.  Money is not what makes estate planning complex, life circumstances make it simple or complex.

Me: I see it is a second marriage for both of you, and that there are three children from one side and two from the other.  Correct?

Client: Why yes, is that a problem?

Me: Not a problem, but certainly not simple.


Me: You've been together for 18 years, never married, she has a son from a prior marriage.  Correct?

Client: Yes, is that a problem?

Me: Not a problem, but we have some issues to explore.

These are what estate planners call Blended Families, and they are not as easy to plan for as the squares in the Brady Bunch boxes might make it appear.  They are complex situations.  What happens when the first spouse dies?  It passes to the survivor, but then where?  Locking in plan to the kids requires a trust most likely, and with that, simple burst like a balloon on a 98 degree day.

Sadly, single with no children does not guarantee simplicity either.

Me: Your questionnaire indicates that you wish to leave your entire estate to eight nieces and nephews for their college education.  And you want to make sure expenses for your three poodles are paid for after your death.  Correct?

Client: Yes, is that hard to do?

Me: Not necessarily hard, but a simple will cannot accomplish these goals.  You'll need a will with trusts -- plural, one for the college funds and one for the dogs.

Who is simple might you wonder?

Me: I see that you are married with two adult children.  There is a combined net work of $3.7 million.  You want everything to go to the surviving spouse, and upon his/her death, equally to the children.  Correct?

Client: Yes, does the net worth create problems?

Me: No, you are under the federal estate tax and it appears that a simple will might be all you need.

Life -- it is always throwing us for a loop.

Monday, July 7, 2014

What Do You Mean She Did Not Survive? Survivorship in the World of Estate Planning

Without fail, every week or so a client will give me the look.  Akin to Gary Coleman on Different Strokes, what I call "the Wathcha' Talkin' About Willis? face.  You remember, this one:

Behind the look is an air of confusion, annoyance and frustration.  These are the type of conversations that place unfavorable adjectives in front of the title lawyer.  Case in point:

Client: My wife died on Sunday, her sister died Thursday, so my wife outlived her and is the beneficiary of the sister's IRA.

Attorney: Well, your wife died after her sister, but she may not have actually survived her, it depends.

Client: [intent pause, brow wrinkles, and they are clearly holding back the statement -- now I thought you were suppose to be smart, you went to law school, and now your tellin' me that my wife did not survive her sister, come on, pay attention] -- what? is the question they toss my way.

Attorney: In the world of estate planning we have a concept called survivorship, it requires an heir to outlive the decedent by a certain amount of time in order to actually live long enough to inherit.  If they die too soon, they are considered to have predeceased and the asset passes as though they had died before the decedent.

Client: what?

Attorney: the thought is that you want your assets to pass to another person, but control what happens if they die before you.....or too soon after you.

Client: okay, so how long did my wife have to outlive her sister?

Attorney: that depends on the situation.

Client: Are you kidding me! Can't you give me a firm answer?

Attorney: No.  In Wisconsin the statutes require an heir to outlive the decedent by 120 hours (5 days) before inheriting, unless a will sets a different time frame such as 30, 60 or 90 days.  But this is an IRA, which is non-probate property, meaning the contract with the financial services company controls.  We need to know, under the contract, what time frame applies.  Do you have a copy of the contract?

Client: No, why would I, it belonged to her sister.

Attorney: Can you get one from the company -- you are a suspected heir since you survived your wife.

Client: [Head falls into their hands] -- why does this have to be so hard?

Attorney: I'm sorry that it is, but I can try to make this easier for you. There is a reason I keep Frango Mints in the waiting room, everyone needs a treat after talking with a lawyer about illness, death and taxes.

Lessons learned: 1) dying second does not necessarily mean a person stands to inherit under a will or beneficiary form.  Timing will likely play a key role.  Did the 2nd to die live long enough after the 1st to actually inherit.  2) hard copies of financial agreements can save countless hours for loved ones left behind to sort out the path an asset will take after death.

Monday, June 9, 2014

It Was Her Wish

"Are you kidding me, it's in the Bible......follow the dying person's last wish!"  It is not often that my husband invokes the Bible, he is an atheist after all.  But when he does, he is serious, and he is expressing the fact something is ancient.  Not just some new trendy idea -- it dates back to biblical times.

We had been discussing the fallout of my mother's memorial service. Yes, such an event can have fallout. And from my vantage point of an estate planning and probate attorney, I can tell you that it happens more often than not.  But here I was, the daughter, not the attorney, in the mini-drama surrounding her final wishes. Thankfully that legal education of mine fortified my backbone, allowing me to stand tall and carry out her wishes, despite the descent of her grieving relatives.

With no uncertain terms, she had clearly expressed her wishes to me from the passenger seat of my Honda Civic.  Sick for many years, we often found ourselves with me driving her home following a hospital discharge. Both aware that her health was declining and that we are all human. Eventually her time would come.

I broached the topic with "I know you don't want to think about these types of things, but if something should happen, would you want a service like the one we did for dad?" First came the sideways glare, and then (I can quote her here) “I don't want nothin' in the god damned church in Brooklyn. I married my first husband (my dad was her second husband) there, and that is where they buried my baby....without me being there. No! I have no happy memories of that place. Do it at the church you go with with the kids, FUS. And I hate my picture, so don't do one of those silly poster boards plastered all over the place. Hmmmh” And that was that, she looked forward and we proceeded home.

Over the years I revisited the topic, wanting to make sure I knew her wishes. And the answer was always the same. Had she been a client, I would have advised her to put her wishes in writing through Wisconsin's Authorization for Final Disposition. But she was mom, and that piece of paperwork was never completed. Her final day on earth was February 16, 2014, a Sunday. The following Monday I contacted the minister at FUS and began setting in motion her plan, her wishes.

It would be a memorial service, not a funeral. It would be held at the First Unitarian Society in Madison, not the Methodist church in Brooklyn where so many other funerals for the family had occurred. It would be several months after her death, not in a few days. It would be her wishes, not the boiler plate funeral of prior generations. We all grieve in our own ways. Communications with her relatives are strained if not severed. She was my mom, and I followed her wish. My question to you dear reader, is what is your wish and who can make sure it happens? The time will come, we just do not know when.

Monday, June 2, 2014

Mary and Baby Jesus Planter Finds a New Home: Tales From the Land of TPP

My phone chimed, indicating a new Facebook alert. Quick downward swipe of my fore finger and there it was, notice that the Mary and Baby Jesus planter had a new home! Relieved, a smile enveloped my face knowing that: one, I managed to keep this item out of a landfill; and, two, a piece of my mom and dad would live on in the home of neighbors who know the meaning of “it takes a village”. The expression “you cannot take it with you” has never had more impact on me than it did at the moment I read that comment. You die, but your stuff remains. And then the question, where will it all go?

Her final breath came on a Sunday, two days after Valentine's Day. One audible exhale akin to sinking into a warm bath, and my mother's earthly days came to an end. It took a few moments for the reality to sink in. She was gone. Both of my parent's were now gone. At age 40 I was an orphan. Sobs finally arrived, having been stoic during her final months, as her body clearly shut down but not her spirit. The polar vortex of 2014 held on firmly that month, and not until its release in late Spring was I able to tackle the TPP.

The what you ask? The TPP. Not only am I her daughter, but I am her estate planning and probate attorney / daughter. TPP is the lingo we use in my line of work to refer to her stuff. Her items, anything from a wedding ring to piano. And after the initial waves of grief washed over me, with the memorial service behind me, and her ashes comfortably settled in the plot next to my dad, was I able to fully face the reality of emptying the ranch house at 1121 Valley Stream Dr. Their abode for 38 years, one that held family heirlooms, garage sale finds that may or may not be antiques worthy of Antiques Roadshow, 8th grade insect collections, bag upon bag of canceled checks from the auto business they owned in the 1970s to 1990s, and mildewed junk that should have been tossed decades earlier. It was a new mountain to face.

The Unitarian Universalist in me advocated for recycling as much stuff as possible. “Empty the jars of applesauce from 1979 and keep those canning jars out of the landfill”, the voice in my head would shout! Another voice, the frugal one, saw value, even minute value in each item. Hey, I could sell this for $2 on Craigs List. And then there was the exhausted lawyer who happens to be a wife of a business owner and mother of a 5 and 3 year old arguing for the most time-efficient manner for emptying the house and getting it market-ready.

It was a mixture of all three who prevailed in emptying the house. Lessons I walked away with were:
  1. Hire someone with time and drive to post items on Craigs List, offering them 50% of the earnings. Requirement, you must trust the person. I am amazed at what a little motivation can do to empty a home – and what others are willing to buy!
  2. Know when to call in the Pros and pay for their expertise. When the basement tiles and adhesive tested positive for asbestos the “country club” ways of my husband kicked in. We hired a firm, bonded and licensed to address the mess. An email requesting me to mail a key said “part of my fee is to make this as easy for you as possible”. To which I simply wrote, “thank you”;
  3. Donate to charity. Yes, I'd be happy to take a tax deduction for 2014 on the TPP I inherited. Pack it, load it and drop it off, or call for a pick-up. Either way, get a receipt for the CPA; and
  4. Give it away. Save your time and the earth, list it for free. I spent very little time hauling items out of the basement, set them outside the garage and listed them (with photos) on social media. People love something for free, and wow did things relocate.
Rehoming the TPP is now complete.  The Mary and Baby Jesus planter now resides in the sunroom of the neighbors who cared so much, and I am ready to move on to the next phase in this life cycle event.  

Monday, May 26, 2014

Memorial Day & In Flanders Field

It's May 26, 2014, Memorial Day here in the United States.  Symbolized by vibrant poppies, it is a day to pause and remember those who have their life in battle for the values American's hold dear.  Today I will be with my family, enjoying the start of summer customs but also taking a moment to reflect.  With children just shy of age 6 and 4, I plan to share with them this poem, from with the symbol of poppy grew, I leave you with a reading of In Flanders Fields.

Monday, May 19, 2014

Have Children But No Will With Guardianship Nomination? Watch Cinderella And Find Motivation To Get It Done

As the parent of preschoolers it was bound to happen, the request to watch Cinderella.  Never a huge fan of Disney movies due to the fact they always manage to kill off the mom, I had kept these films from our kids. But now, on the cusp of turning 6 and 4 they had heard enough from classmates to request a viewing.  A free DVD was up in our closet, a long ago gift from family.  So, this past Mother's Day weekend, as the heavens unleashed a Spring storm over Madison, I curled up with my kids and husband to watch this classic film.

Almost immediately my husband turns to be, and with an amused but shocked expression on his face, mouths "it's an estate planning problem!"  And so it was, on my day off from work here I was watching a film with the type of situation I walk clients through on a daily basis.  If you die, and then your spouse dies, who will take care of your children and the funds you leave behind?

Guardianship, it's a key sticking point for many parents of young children.  Indecision or an inability to face their own mortality keep this question from being answered.  Thanks to Cinderella I can safely say, planning is not nearly as bad as not having a plan should the unthinkable happen.  If you need a starting point, here are a few questions I would offer -- as a mom myself -- for your consideration:

  1. Who shares your values?
  2. Who is close to your child(ren)?
  3. Who has the ability to welcome your child(ren) into their life and home?
  4. Is the same person as equipped to handle funds you leave behind (i.e. life insurance, retirement, home equity, etc.)?  Remember, someone who might be great with children may not be skilled at financial matters.
  5. Who shares your views on religion, education, lifestyle, and finances?
  6. Consider those in your circle of family and friends -- you are not required to name a blood relative.  More often than not family shares your life but not your DNA.
  7. Have a backup plan, who is your second choice.
  8. If you are considering a couple, ask yourself which one would you choose if that couple divorced? Given the divorce rate it is an important factor to consider -- is the one person sufficient, or was it the couple that made the deal in your mind?
And I could go on and on, but that is for you to consider and speak with your attorney.  Remember, a blog is not legal advice.  Rather it is a forum for discussion.  The same week I watched Cinderella I also read a news story about a women who had created a plan for her houseplant -- one that will likely long outlive her.  This woman had planned for a plant!  Yet how many parents have not asked, what happens if were not here.  Need more motivation?  Watch Disney's Cinderella and you'll likely be prodded in the right direction -- make a decision, and make it legally binding.  Thanks for reading, and have a great week.

Monday, May 12, 2014

But My Banker Said It Was Okay.....Unauthorized Practice of Law

Weekly, if not daily, I find myself in a verbal or email conversation with a client in which I am having to explain why want they have done, or think they can do, is not a wise option.  Frustration on their part is evident.  Why am I telling him or her no when his or her banker, financial planner, sister, or fellow bus rider said they could.  Because I'm their lawyer, that is why.  They accept it, and I feel for them.  Why does it have to be so hard?  Because things get complicated quickly.

Add another person to your bank account?  You may have just stepped on the gift tax.  The IRS will not care if the banker suggested this move and thought it was okay.

Manage to add your daughter's name to the deed of your condo?  What happens when she dies, gets sued, files for divorce or bankruptcy?  Your financial planner probably never brought those scenarios up before encouraging you to get a quit claim deed to make the change yourself.

Relatives descend like a turkey vulture on grandma's house within 36 hours of her passing, there to "claim" what she said would be theirs.  The County Sheriff or DA will likely not care what Great Aunt Mary said when suggesting you all go in and clear out the house.  Theft from an estate is theft.

Most people, especially your financial team, aim to help, but inadvertently give poor legal advice.  As I say in my seminars, it is less expensive to get advice from a lawyer before you act rather than  hire one to clean up a mess.   Unlike your banker, lawyers are authorized to practice law.  Those who are not engage in the unauthorized practice of law:
Every jurisdiction in the United States recognizes the inherent right of individuals to represent themselves in legal matters. In contrast, the privilege of representing others in our system is regulated by law for the protection of the public, to ensure that those who provide legal services to others are qualified to do so by education, training, and experience and that they are held accountable for errors, misrepresentations, and unethical practices. 
Thanks for reading.....and note that a blog is not legal advice.  Please consult your attorney for advice specific to your situation.

Monday, May 5, 2014

Changes In Wisconsin Trust Law

The author's inquisitive older child.  One who also loves to learn and ask questions.  Possible scientist, possible lawyer?  Time will tell.

Why did you become a lawyer Mama?  This question was posed to me as my oldest child settled into bed last week.  Two reasons: I wanted to help people, and I love to learn.  Law allows me to do both of those things.  He floated off to sleep and I went down the hall to the computer where to process the end-of-the-day emails that routinely pile up from 3:30pm until the fall to sleep, a time I devote to my young children.  Waiting in the email was a reminder about an upcoming Continuing Legal Education seminar offered by the Wisconsin State Bar.  It is a good thing I like life-long learning, because according to the flier -- everything we knew about trusts in Wisconsin is about to change.  Here is a quick overview of why, put together by my associate......who has already attended the seminar!

 2013 Wisconsin Act 92 goes into effect on July 1, 2014. This law replaces Wisconsin's current trust statutes with the Uniform Trust Code, and also adds some additional provisions. Some of the most notable and relevant provisions of the new trust law are discussed below.

    1) The new law arguably diminishes the court's oversight of trusts. For example, there will no longer be continuing judicial supervision of a trust unless an interested person files a petition with the court for such supervision to occur. Additionally, there is no longer an annual account filing requirement for testamentary trusts.

    2) Pet trusts are now specifically allowed.

    3) The default rule is that trusts are revocable. In order to be irrevocable, the trust must specifically state that, or it will be presumed revocable. This rule only applies to trusts created after July 1, 2014 

    4) The new law allows for nomination of a "trust protector." This is someone who is given power over the trust, but in a different capacity than the trustee or other directing party. The trust protector's powers must be stated in the trust. In general, the trustee must follow the direction of the trust protector unless doing so would constitute a serious breach of duty.

Watch for more as the new trust law unfolds here in Wisconsin.  Have a great week, and please remember that a blog is not legal advice.  Consult an attorney in your state for advice specific to your situation.

Monday, April 28, 2014

Who Would Be Your Advocate in a Crisis?


Last week I had a great phone conversation with someone who had attended a seminar of mine in the past. The caller was exploring long-term care options, and we have a very enjoyable conversation about the pros, cons, and unknowns (that is an entirely different article from this post).  The caller raised a key question when updating or creating an estate plan "who do I know who is savvy enough to understand this long-term care contract, because if it comes into play, I'm not healthy enough to advocate for myself?"

Excellent question.  All too often I see people with a knee-jerk response to the question who do you want to list as your agent on the power of attorney for finance.  My son, because he is the oldest or my sister, because if I do not she'll nag me until the day I die -- all things I have heard from clients.  And in my opinion insufficient.  If you are too sick to make your financial decisions, who in your circle of family or friends has the time, knowledge, backbone and sophistication to navigate your insurance contract, file your taxes, pay the mortgage and manage your checkbook.   Remember, if that circle does not contain an appropriate candidate you can always turn to a professional.  Banks, trust departments and accountants are all businesses with the desired skill set.

Thanks for reading, and remember, a blog is not legal advice.  Please consult an attorney in your state for advice specific to your situation.

Monday, April 21, 2014

Relatives vs. Family

Estate planning essentially answers who and what questions.  Who will be in charge when you are either to sick to act or have died, and what will happen to your assets.  One of the top five questions clients pose during meetings is "can I name someone other than a family member?"  Without hesitation, my answer is "yes, it is about taking control, name who is right for the job."  What follows is a discussion of the skill set needed to be an agent under a power of attorney for health, or finance, or a personal representative for a will.  However, before we get to that discussion I encourage you to pause and ask -- who is your family?

Asked to define family, I would say they are the people who share your life.  They are there for celebrations, for mourning, and the mundane.  On the other hand, relatives share your DNA or a branch on a family tree. Sometimes relatives can also be family, but not always.  Before instinctively naming your brother or an aunt in a role, ask yourself -- are they family, or just a relative?  If the later, look to someone who falls into the category of your family instead.

How do you tell the difference?  Here are a few points to ponder -- what makes someone family, at least in my book:

  • you have shared a meal together in the past year;
  • after major surgery they have helped you with getting dressed and or transported home;
  • if you have young children, they have spent time in that child's bedroom playing;
  • you communicate with them in person, on the phone, or via email once a month.  Facebook and other social media do not count;
  • if you have a pet they have cuddled the animal or if not a pet person, shooed the critter away; or
  • when life gives you a joy or sorrow, this is a person you reach out to to share.

It is my experience that far too many people equate relationships recognized in state statute as being the same as family.  This week I will lean on my own advice -- it is one in which we will pay tribute to my mother, who's earthly life ended in February.  Reminding myself to focus my energies and efforts on the family who walked by my side, sent words of support, dropped off meals, or watched our young children so I could have a few final hours at my mom's side.  On the periphery will be relatives, sadly ones with requests harboring on the edge of being demands.  They appear unable to understand that the phrase "the immediate family" is not a status automatically granted to those who share DNA or a last name, but rather to those who share a life. At least in my opinion.

Be well, and thank you for reading.  Please remember, a blog is not legal advice -- seek the advice and counsel of an attorney licensed in your home state.

Monday, April 14, 2014

Book Review -- What Do We Tell the Children: Talking to kids about death and dying

With my mother dying this past February, the topic of talking to children about death and dying has been on my mind.  And it is a topic that sometimes comes up in the office.  When the book What Do We Tell The Children? Talking to kids about death and dying by Joseph M. Primo arrived on my hold shelf at our local library I was eager for some advice.

Primo is the executive director of Good Grief, Inc, a nonprofit in New Jersey.  He holds a divinity degree and is a former hospice chaplain.  Consisting of eight chapters and just under 130 pages, it is an approachable book.  The reader is drawn in by Primo's own story of his first experience of death; he was a teen when an aunt died suddenly at a family gathering.  His story highlights how society used to talk to children about death -- essentially not at all.

The book then continues much in the style of a memoir, pulling from stories during his time with hospice and then Good Grief, Inc.  As a fan of memoirs, I enjoyed the book.  However, as a parent needing to answer questions about death to my five and three year old, I did not find the book to be a great resource.  It is less how-to more more of a survey of what society has done and could do.  The stories are moving and sometimes powerful, but the format does not let a flustered parent quickly access tips on answering questions.  I would have preferred an organization that allowed me to focus on age appropriate answers, what happened to Grandma is addressed quite differently to a 16 year old versus a 4 year old.  And then there is the religion factor.  Ours in an atheist home, and stories from the bible are of no help to us.  Again, a book with sections for various religious view points would have been more useful.

Overall I enjoyed the book, Primo is a nice storyteller. However, it was not the book I expected to read.

Monday, April 7, 2014

Survivorship In the Context of Estate Planning and Probate

Crashed Car

Image from, #921217

Imagine a car is traveling on the interstate, heading out for a much needed Spring Break.  At the wheel is a newly minted driver, 16 year old Todd.  In the passenger seat is his proud mother Sharon, navigating the GPS instructions taking them to the Sunshine State for some good times.  At home remains Todd's pet dog Tuffy, left in the care of his father, Ted, the ex-husband of Sharon.  In the blink of an eye a tire flies off a passing vehicle.  The inexperienced Todd over-corrects and a violent collision occurs.  When rescue crews arrive Sharon is declared dead on the scene.   Todd is airlifted to the nearest trauma hospital where he dies. What happens to Sharon's estate?

If she did not have a will, state statute controls.  Here in Wisconsin her probate estate would pass to her son as long as he outlived her by 120 hours.  Should Todd die the following day, he would not have survived and Sharon's estate would pass to her next heirs-at-law, her parents if they are living (assuming Todd had no children of his own or other siblings from his mother).  If not, then on to Sharon's siblings.  Should Todd outlive Sharon by 3 weeks he would have survived her, inherit her estate, and then died intestate (no will) with state statues leaving his assets (those that he just inherited from his mom) to his father, Ted.  Yes, whether Todd dies before or after 120 hours determine whether or not Sharon's assets would eventually pass to her ex-husband.  

Survivorship, outliving another from which you will inherit, is not a simple issue.  If a will controls the distribution of property it likely contains a suvivorship clause, meaning in order to inherit, one needs to outlive the decedent by a certain number of days.  The documents we draft in our office generally call for a 90 day survivorship.  Residents of Wisconsin without a will fall under state statue requirements of 120 hours (5 days) in order for another to inherit.  Wisconsin Statutes, Section 854.03(1) states:

854.03 Requirement of survival by 120 hours.(1) Requirement of survival. Except as provided in sub. (5), if property is transferred to an individual under a statute or under a provision in a governing instrument that requires the individual to survive an event and it is not established that the individual survived the event by at least 120 hours, the individual is considered to have predeceased the event.

Do not assume that just because someone died after another that the statutes, or a governing document, will agree on that person having survived.  As you can see with this hypothecial, survival is conditioned on surviving for a certain amount of time.  That time varies from state to state, and document to document. Consult with an attorney to learn more about your specific situation.

Thanks for reading, and if you are head out on Spring Break, be safe and buckle up when behind the wheel.

Monday, March 31, 2014

What Washington Giveth, Washington Taketh.....Federal Estate Taxes in the news again

In 2012 Congress and the President gave a gift to those attuned to estate planning.  The federal estate tax exemption was increased and earmarked for inflation.  Finally!  Now I could advise my clients beyond the year or two into the future.  We had a federal exemption of $5 million per person.  Until then the threat of the level falling back to the $1 million mark lingered. That made planning a challenge.

Under current law any one person can die and leave $5.3 million at death without triggering the federal estate tax.  Married couples can leave an unlimited about, tax free, to US citizen spouses.  With the exemption tied to inflation, planning done now evolves nicely over time. And then I blinked.

Over the past two years, as I discussed the federal estate taxes in seminars, I routinely joked "what Washington giveth, Wasthington can taketh -- keep an eye on this issue."  Perhaps I told that joke one time too many.  News reports last week of the President's proposed budget include language to reduce the federal estate tax exemption in 2018 to $3.5 million, and to my dismay, remove the indexing to inflation, would tax any amount over the exemption at 45%.

And so our brief honeymoon with stability in the area of the federal estate tax is over.  Clients with a net worth of several million need to consider putting in tax planning language, just in case.  And I'll be watching and reading what comes out of DC, curious to see what, if anything, happens in this area.  Once a city I called home, it is a curious and fickle town.

Author's children, playing in the sand on The Mall.  National Capitol in the background.

Monday, March 24, 2014

Medication -- One of the Many Items a Loved One Leaves Behind at Death

Perscription Drug Case

Readers of this blog may have followed that my mother passed away on February 16th of this year.  With her last breathe I was an orphan at age 40, my dad having died back in 2009.  I was also left with the task of emptying and cleaning out their ranch home.  And is often the case, it had quite the supply of medications. Some used, others not, some prescription, others not.  Regardless of the source, I found myself hold two large plastic bags full of pills, creams, inhalers, and more.  What to do with them?

Tossing them down the drain or in the trash puts current and future generations at risk -- a water supply contaminated with discarded meds.  Harmful to fish, wildlife, and possibly us.  Thankfully here in Madison there is a program called MedDrop, offering 12 year round drop off sites.  One was not far from my mother's home.  And it was just as the snow began to melt and Spring moved to town that I safely disposed of the medications from her home.

End of life affairs for a loved one run a huge spectrum.  There are more immediate decisions about funeral and burial.  Ushering and estate through probate or trust administration.  Finding new homes for pets and or plants of the decedent.  Filing a final tax return.  And as shown here, taking a few extra minutes to make sure medications end up in a safe and proper location -- not a landfill.

Thursday, March 20, 2014

GGLO Forms Team for American Cancer Society Walk

One of the top five things that motivate clients to pick up the phone to call and make an appointment to begin the process of creating a will is a stage-four cancer diagnosis.  Working with the client, the family, and often involved in the post-death paper work, we here at GGLO are motivate to do what we can to raise funds for research and treatment.  And that is why on Saturday, April 12th we will be lacing up our walking shoes. Join our team and or make a donation -- our goal is to raise $1,000.  Click here for more details.  Checks payable to the American Cancer Society can be sent to our office, 313 Price Place, Suite 204, Madison, WI 53705, by Friday, April 11th.  Together we can make a difference!

Tuesday, March 11, 2014

Middle Class Philanthropist: How anyone can leave a legacy appears on Wisconsin Public Radio's Larry Meiller

Thank you to guest host Judith Siers-Poisson for having me on Wisconsin Public Radio's Larry Meiller Show yesterday to discuss my book, Middle Class Philanthropist: How anyone can leave a legacy.  For those who were not able to tune-in, the show is now available on-line, click here.

Philanthropy is a term normally associated with individuals who have a seven-figure net worth, making a splash in the end of the year news cycle with hefty donations to worthy causes.  Judith and Wisconsin Public Radio helped shine the spotlight on the every day Americans who have made a difference in the life of a nonprofit without leaving it a fortune.  I know the four stories included in my book are not the only ones out there.  If you have a story to share, please email or call me as I work on my second book on this topic.  My goal is to profile ten or twelve individuals or families who have left a legacy without being mega-wealthy.

Monday, March 10, 2014

When The Dead Want to Connect -- Removing A Colleague on Linked In and Other Social Media

Author's parents

It's an email that lingers in my memory years after I found it in my in-box.  "Carl wants to reach out to you!". The Carl in question had a Yahoo email account, and it was not Carl who had been on the account recently but rather his widow Sharon.  They used the same email but it was registered to him, one she did not change after his death in September of 2009.  Why would an email from so long ago still take up precious memory power today in 2014?  The Carl behind the email was my dad and his widow my mom.  He had only been dead for a few months when one day I find a cryptic email waiting for me.  Thanks Yahoo!

A similar yet less emotional social media ping hit my husband last week.  Going about his work week he was running through the hundreds of emails that tend to pile up.  Sitting there was one from LinkedIn encouraging him to congratulate a colleague on a work anniversary.  Sadly, the colleague had died suddenly a year before.  He was gone from the engineering world, but LinkedIn had no idea.

Curious about what to do, my husband searched around and found a discussion chain.  Sadly there is no one and obvious button to click to resolve this matter.  As pointed out, many of the young techies out there pioneering social media seem unaware that from birth, death will one day follow.  And sometimes the death is sudden, unexpected, and at far too young of an age.  If you are receiving messages on Linked In or other social media to connect with a now deceased colleague or friend, here are a few avenues to consider:
  • contact the family and friends to see if they will submit a death certificate to the company to have the account turned off;
  • alert the company of the death and underscore the general need to create a user policy that makes reporting deaths far easier than it is now;
  • create a folder or sub-circle of contacts who have passed and label it "deceased" -- I doubt this will translate to the main software, but it does allow you to make note of those who are no longer with us and may prevent you from inadvertently contacting them down the road should you have forgotten about their passing.
As I have blogged in the past, most tech companies do not allow the Personal Representative of an estate to turn off a social media page, but rather convert it to a memorial page.  With the sheer number of Baby Boomers on social media, in time, these policies will likely advance and allow loved ones to more easily turn off or make accountants dormant.  But it will take time.  

Earlier this year my mother entered hospice care. Her time was limited, and I used the Power of Attorney to turn off her cell phone.  I never anticipated how hard it would be, or the fact that the 20 something sales support person had no idea what the word "hospice" meant or the term "Baby Boomer".  He was nice, kind, and clearly impacted by the fact my mother was dying, but he was also a bit clueless about this element of life.  Time, it will take time for the young tech companies to grow up and plan for death.  For now, be patient, be creative, and make the most of your day.

Monday, March 3, 2014

An App You Can Use To Distribute TPP

T.P.P. -- in the world of estate planning it means your tangible personal property.  Basically it is your "stuff". From a wedding ring to the family piano, anything you can pick up and carry.  And when you leave your earthly word behind, the question becomes -- where will my TPP go?

During a client meeting last week this topic came up, as it often does.  I gave my standard response, "use the inventory template I provide but be very specific, imagine telling a stranger what item you mean, where it is located, and who should receive it -- you cannot be too specific."  The wife asked "would pictures be wise?"  My response, "yes!".  And then the husband said --"use Encirle, an app on the phone!"  A few minutes later he'd emailed me the link.

Marketed for protecting again loss from theft, it would also be an easy way to go through your home and document what you want to go and to whom.  My cautious legal mind says the app would document the written instructions one has already left, not stand alone.  But check with your attorney for his or her opinion. Remember, a blog is a place for sharing of ideas not the dispensing legal advice.

If you have a creative way to leave specific instructions on what should happen to your TPP when your time comes, take a moment and leave a comment.  And thanks for reading.

Our "stuff" -- it may not have a large dollar value, but emotional value can be priceless.  
Author's fridge with children's artwork -- priceless!