Jun 19, 2017 | Estate Planning |
If you have been named as an agent for a loved one under a power of attorney, you have some new legal responsibilities. A power of attorney is a legal document naming another party as an agent – someone who has the legal right to make decisions about money and property on behalf of the person who executed the power of attorney. This agent is also called a fiduciary. There are several types of powers of attorney, ranging from those covering a single transaction, i.e., a wife might sign residential closing documents on behalf of a husband who is unable to attend closing, to an elderly parent worried about becoming unable to care for him or herself. Each power of attorney should specify when the document goes into effect and what responsibilities are covered under the document. If your father (for example) has named you as his agent, and he has reached the point where he is not able to make decisions by himself any longer, it becomes your job to act on his behalf. You have four primary responsibilities under the power of attorney: You must act in your father’s best interests. The power of attorney may outline exactly what role he wants you to play. Make sure you read it carefully. If your father is still able to help, it is a good idea to involve him in decision-making. You must maintain your father’s money and property separately from yours. You do not want there to be any question about your intentions or actions. Money belonging to him should go into accounts in his name, and expenses...
Jun 14, 2017 | Estate Planning |
By David Inabinett, Attorney Clients often ask, “Is it ‘legal’ to write up my own will” or “can I just write in changes to my will?” While a handwritten Will is recognized as “legal” in North Carolina, a June 2017 case decided by the NC Court of Appeals illustrates why that may not be such a good idea. The Matter of the Will of James Paul Allen In The Matter of the Will of James Paul Allen, Mr. Allen had a valid typewritten signed and properly attested will leaving in Article IV a life estate or “lifetime rights” in certain lands to an individual with full ownership in those lands passing to two other people upon the later death of the person given the lifetime right. However, Mr. Allen apparently wrote in the margins of that Will his own handwritten notes saying, “Beginning 7-7-03 do not honor Article IV Void Article IV James Paul Allen.” A dispute arose as to whether there was any legal effect of those handwritten notes since those effectively omitted the life estate and gave all of the land fully to the individual who had previously only been given a lifetime right. The Rules for Handwritten Wills A hand written or “holographic” will must be: Written entirely in the handwriting of the deceased but when all the words appearing on the paper in the handwriting of the deceased are sufficient to constitute a valid holographic will, the fact that other words or printed matter appear thereon not in the handwriting of the deceased, and not affecting the meaning of the words in such handwriting, shall...
Nov 7, 2016 | Estate Planning |
By David Inabinett Many of our estate planning clients put great thought into their final wishes as they write their wills, create trusts or name executors. Despite the planning, there may still be disputes over how the estate is handled. Here are the three most common estate disputes we see: Division of tangible personal property can be a challenge, especially when the property may have sentimental value or be perceived as valuable. When there are multiple heirs getting “equal” shares per the will, determining value and how the assets will be distributed can lead to animosity. There are a few practical options to avoid this conflict. One of our clients had her children come to her home together and go through her belongings. They worked out a list of who would receive which furnishings, art and jewelry. She included this list, signed and dated by her, with her will. Another option is to bring in an independent appraiser to value all the items in question. These items can then be divided, round-robin style, with each party receiving items up to the value of their share. Items no one wants can be sold and the proceeds split evenly. One important note: should an individual die intestate (without a will), North Carolina law determines how the estate will be distributed. This may not be how the decedent and his or her heirs would have planned and can cause quite a bit of friction or unintended results. Shared real estate is another area where potential conflict can arise. When there are multiple heirs, each may have different ideas about whether to sell...
Jun 28, 2016 | Estate Planning |
By E. Drew Nelson, Attorney On July 13, 2016 ATF regulation 41P will go into effect. This regulation significantly changes the landscape of acquiring and possessing Title II or restricted firearms. You may have heard about this regulation on the news or during a recent visit to your local gun shop. Over the past several years there has been ongoing debate about amending the requirements to purchase and possess Title II firearms. ATF regulation 41P makes some very important changes in regards to both individual ownership of restricted firearms and ownership via a gun trust or other legal entity. The most significant changes are as follows: The Chief Law Enforcement Officer (CLEO) will no longer have to sign off on any application to purchase a restricted firearm. Under the old regulations any individual submitting a Form-4 for purchase would have to have the CLEO sign off on the application. Many people set up gun trusts to avoid having the CLEO sign off on an application. This will make it easier for individuals to purchase restricted firearms. However, it does not help protect an individual from any liability incurred with improper possession or transfer of the firearm. Form 5320.23 will be required for all “Responsible Persons”. This is a major change that affects trusts looking to purchase restricted firearms. This is a new form required to be sent in with your Form 4. A copy is also required to go to your CLEO. This form will require a recent passport style photo taken within one year. A “Responsible Person” is any member of the trust “who [has] the power and...
Feb 10, 2016 | Estate Planning |
The Pension Protection Act of 2006 permitted individuals to draw money directly from their IRA accounts and donate it to qualifying charities without having to declare it as income. This rollover was capped at $100,000 and counted towards the minimum IRA distribution required of those aged 70 ½ and older. The Act was renewed annually for the next several years, leaving taxpayers to wonder each year if the rules would change. On December 18, 2015, President Obama made the IRA Charitable Rollover permanent when he signed the PATH Act into law. This is a relatively seamless option for seniors who wish to donate to charity. Without the Charitable Rollover, an individual would have to take the minimum IRA distribution for the year and count the total amount as taxable income. Depending on his or her total other sources of income from Social Security, pensions, etc., the minimum distribution could push the taxpayer into a higher tax bracket. He or she could then donate to the charity and take a tax deduction to protect a portion of income from taxes. Under the PATH Act, the individual specifies the amount, up to $100,000, to be donated and it is distributed by the Trustee of the IRA directly to the eligible charity or charities. This is counted toward the annual minimum IRA distribution. The individual then takes the remaining balance of the minimum distribution (if any) and claims that amount as income. Since the monies were pre-tax and were sent directly to the charity, the individual cannot claim the donation as a deduction. It is important to confirm that the charities you...
Jan 4, 2016 | Estate Planning |
We’ve updated our Estate Planning Guide for 2016. If you haven’t reviewed your estate plans recently or you’ve experienced a major life event (birth, marriage, divorce, death of a spouse), you’ll want to review this...
