The federal law, known as the Health Insurance Portability and Accountability Act (HIPAA), generally prevents health care providers from disclosing your personal medical information to anyone other than you and someone you’ve named as your “personal representative.” Frequently you will sign medical releases at your physician’s office allowing them to communicate with any specialists you are seeing, like a podiatrist or a cardiologist. Protecting your medical privacy is very important but the law can create some complications.

Madelyn executed a Health Care Proxy that names her daughter, Stella, to make medical decisions when/if she is unable to make them herself. Unfortunately, her Health Care Proxy doesn’t include a HIPAA provision due to poor planning. Madelyn develops dementia and Stella feels that the doctor may be overlooking an undiagnosed mental illness. This is in addition to Madelyn’s cardiac issues. Since Stella isn’t the “personal representative” under HIPAA regulations, she has had a lot of difficulty speaking with her mom’s doctors and accessing written medical information. She is frustrated because she can’t make the best health decisions for her.

Madelyn also executed a Durable Power of Attorney which also named Stella to make her financial decisions if she would be unable to make them in the future. But, again, the document did not name Stella as her HIPAA “personal representative.” Stella cannot access Madelyn’s medical information and cannot prove to Madelyn’s financial institutions that she is indeed incapacitated. As a result the Power of Attorney document is of little value and may force Stella to seek out a costly Conservatorship in probate court.

To make sure your chosen agent(s) do not get caught up in this conundrum, your Power of Attorney and Health Care Proxy documents should contain HIPAA clauses. It is also highly recommended, and has long been the practice of this office, to sign separate HIPAA release forms.

Lacking HIPAA provisions isn’t the only reason why Health Care Proxy and/or Power of Attorney documents fail. Did you know that recent Massachusetts laws directly affect the way these documents should be drafted to be fully complete? Also easy to overlook items like lacking specific powers, or not having the document executed properly, can leave your family in a tough situation where they have to go to court to get the power you intended to grant them in the first place.

If you are concerned that your Health Care Proxy and/or Power of Attorney documents are lacking, please contact Vickstrom Law to make sure they are complete and comply with the new laws.

Photo credit, cyOFdevelin and used under a Creative Commons license.

Inspiration from the Food Network

Still, I do love the challenge of a new, never-been-tried recipe. Usually it’s something that friends or family have recommended or I’ve

managed to catch a few minutes of on Food Network. Personally, I’m partial to Bobby Flay and Alton Brown, Rachael Ray‘s great when I don’t have a lot of time. Who’s your favorite? Let me know in the comments.

Estate Planning with an accent on Planning

What I love about creating a new dish is that it is an entire experience. First I have to go to the market to get a bunch of exotic ingredients that I usually don’t have around the house (have you been to the Wegman’s in Northboro yet? Fun!). Then, once back in the kitchen, comes the prep where — hopefully — I get to employ some of the many kitchen gadgets that have gathered a bit too much dust. Finally, the cooking, where, if I’ve followed the recipe correctly, it all comes together in one exciting and delicious meal that will make everyone forget the stresses of the day.

Now, I don’t often talk about myself or my home life on my blog because I want this space to be about you and the challenges you face planning for your future. However, as I see more and more television advertisements for do-it-yourself legal document websites like LegalZoom, I worry that people are taking terrible risks with their estate planning and won’t be adequately protected for the future.

Cookie cutter solutions fail to plan

The problem with DIY legal doc services is that they essentially only give you one half of a recipe. LegalZoom can give you a list of documents you need and then prompt you to fill them out. Easy! But, what do you do then? You have a bunch of “critical” documents that have no relation to each other because they were coughed out by machines that don’t know you. You’ve just been told to cut up carrots, onions, and celery, but with no instruction on how to cook them in a pot of water to make a soup stock. Yes, those are the individual parts of a soup stock, but, you want to be able bring them all together, and use that stock to make one great dish.

All your estate planning ingredients must work together

This is why the advice of a legal professional is so, so important when planning an estate or trust. You will get both sides of the recipe: the ingredient list AND the instructions on how to turn all of those documents into a comprehensive plan — focused on a singular goal — to ensure that you and your family’s financial and medical needs are always met. All of the documents-and the components of those documents-necessary like HIPAA releases, declarations of homestead, will and trust provisions, beneficiary designations, and irrevocable trusts, etc., won’t be of any value to you unless you prepare them all together into a cohesive plan. They’re all essential pieces of the estate planning recipe but LegalZoom and the like can’t mix them together properly without getting to know you.

Don’t get caught with half a recipe, a bunch of individual ingredients, and nowhere to put them. Contact Worcester-area estate-planning and elder law attorney Kristina Vickstrom to ensure that your estate plan is legally sound and fully-baked.

The late singer’s will leaves everything to her 19-year-old daughter, Bobbi Kristina, but Kristina can’t access her mother’s estimated $20 million fortune right away because it is in a trust.

According to news reports, Houston’s will sets up what is known as a “testamentary trust” for her daughter. A testamentary trust is a trust created by a will. The will names a trustee and specifies what property will be put in the trust. Such a trust has no power or effect until the will of the donor is probated (processed through the legal system). Although a testamentary trust does not avoid the need for probate and becomes a public document because it is a part of the will, it can be useful in accomplishing other estate planning goals, such as providing for a child or reducing estate taxes in certain circumstances.

The person creating the trust may want to prevent a beneficiary who is a child or young adult from inheriting a large amount of money before he or she can handle it. One option is to pay the beneficiary in stages when the beneficiary reaches a certain age or achieves a specific goal.

This is what Whitney Houston’s trust does.  It reportedly allows Houston’s daughter to receive a 10 percent payout when she turns 21, another one-sixth when she turns 25, and the remainder of the trust’s assets when she turns 30. In this type of trust, the trustee usually has the discretion to distribute trust funds to the child at any time prior to attaining these ages, if needed for education or other reasons.

Will Never Updated

Now to the surprising parts of Houston’s estate plan.  First, as Forbes magazine columnists note, Houston could have accomplished the same goals through a living trust, a type of revocable trust, which would have kept the provisions of the trust private because it would pass outside of probate. Second, Houston was relying on a will that was created in 1993, when she was married to Bobby Brown, and it apparently was never updated, even after she and Brown divorced in 2007.  The will names Brown as the suggested guardian for Bobbi Kristina.  Although Bobbi Kristina is no longer a minor, Brown could still gain control of Kristina through a Conservatorship, as was done in the case of Britney Spears.  Finally, the will provided that if Houston had no living children at the time of her death, her fortune would be split between Brown and several family members.

Perhaps all this is what Houston wanted, even after her divorce from Brown, but that should have been made clear in an updated will.  As it stands, it appears that Houston simply neglected to do something elder law attorneys urge all clients to do: update their estate plan after a divorce or other major life change.

Trusts — either testamentary or living — can be set up for many different purposes. To decide if a trust is right for you, consult an elder law attorney.

Contact Attorney Kristina Vickstrom for more information on trusts.

Photo credit: asterix611 / cc by-sa 2.0

Far too many people assume that their families would make the choices they would want in an emergency.  Yet everyday we hear stories of adult children, siblings, or other relatives/friends battling during a health care crisis over “what their loved one would have wanted” in that situation.

The Terry Schiavo case is a great example of this. At the young age of 26, Shiavo suffered sudden cardiac arrest and slipped into a permanent a vegetative state.    She never documented her wishes about things like feeding tubes, life support, and long-term quality of life, leaving her spouse and parents to battle for years over these questions in court.

Her husband eventually had her feeding tube removed claiming, “That’s what she would have wanted.”  But was it really? Her parents certainly didn’t think so. But we’ll never know because Terry didn’t make her healthcare wishes known to her closest family and friends.

But it’s not enough to just tell someone about your wishes.  You need to clearly document your preferences, too.  Remember, emotions can run high during a health care crisis, and it might be hard for your loved ones to stop life support when they desperately want you around.  Having your wishes spelled out in writing helps make these types of decisions easier for your loved ones, especially in cases when family members don’t agree.

So in honor of National Health Care Decisions Day, I encourage you to start tough conversations with loved ones about your personal medical preferences for medical and/or long-term care.  Here are some important questions to consider:

• What are your thoughts on feeding tubes, life support, and other artificial life saving devices?
• Is there any type of medical care you would NEVER want?
• If you were permanently disabled or incapacitated, what things would contribute or take away from your “quality of life?”
• Who do you trust to make important medical decisions if you are unable to speak for yourself?
• What are your thoughts on nursing home vs. in-home health care?  Who would you trust to manage your long-term care? your finances?

These are not the most fun conversations to have, but they will help to ensure that your most personal wishes are honored in a true medical emergency.  Talk them over with loved ones and have Attorney Kristina Vickstrom prepare important legal documents like a Health Care Proxy, a Living Will, and a Durable Power of Attorney. Getting documents in writing that spell out your wishes and the care you want if something happens to you is one of the best gifts you can give your family. It can avoid misunderstandings, family disagreements, and even court battles.

Get something in writing before an unforeseen emergency strikes. Do it early (age 18 and up) and check it often (with a major life event, or at least every 5 to 10 years) to make sure you have the most protection under the current Massachusetts laws and to make any changes to your wishes and/or decision makers.

Photo credit: Shoothead / cc by-nd 2.0

As an estate planning  and guardianship attorney, I recommend that all parents in Worcester who have children under 18 make planning a priority.  No one wants to consider the idea that they will not be able to raise their kids, but the unforeseen does happen.  By putting a plan into place while you are young and healthy, you can help determine your children’s future, even if you aren’t able to play the role in it that you had hoped.

For example, if you were to die or become somehow incapacitated, who would you choose to care for your child or children?  In many cases, the surviving parent is the obvious choice.  But, considering the fact that the family will be going through a particularly difficult time and that the parental responsibilities will now fall to one person, it may be beneficial to go a step further.  To do this, more central Massachusetts families are choosing to create an estate plan that provides for more financial support of both the children and the spouse.  In doing so, that caregiver can be relieved of some of the burden of working and raising the children.

In cases where both parents are killed or where one parent is already absent from the child’s life, setting up a guardianship is a must.  This allows you to determine who in your “village” will be responsible for the continued upbringing of your children.  Your estate plan may offer financial support to this person as well as trusts that the children can access when they reach a certain age.  That said, it is acceptable to place a different person than you named as guardian in charge of financial responsibilities.  An estate planning attorney will walk through the options with you in order to find a solution that best fits your situation.

When it comes to finances, it is also a good idea to consider what kinds of restrictions you might want to place on your children’s access to inheritance.  Some parents make access contingent upon certain goals such as age, education, and behavior.  Simply allowing access to a trust when a child reaches 18 may not always be the best approach due to inexperience and pressure from others.

Again, an estate planning attorney is well versed in the options available to parents who wish to plan for their minor children.  Choosing someone in the Worcester area, like Vickstrom Law, ensures that your estate plan is valid, complete, and meets the criteria of the local courts. For more information, please contact Attorney Kristina Vickstrom.

Photo Credit:  limaoscarjuliet / cc by 2.0

The Circuit Breaker Tax Credit is meant to help low to moderate income seniors whose real estate taxes or rent take up at least 10% of their income. Both you, and your spouse, if you are married, must be age 65 or older as of December 31, 2011, and if you are married, you must file a joint return in order to qualify for this credit. No one else can claim you as a dependent, and you must rent or own a home in Massachusetts as your principle residence. This means that if your principle residence is in Florida, you are not eligible for this credit. You are also not eligible if your rent is paid through a federal or state subsidy. Additionally, your property must have an assessed value as of January 1st, 2011 below $729,000.

The income limits to qualify for this credit are relatively high, which is a good thing because it means many seniors in Massachusetts can take advantage of it. If you are filing as a single adult, your income must be below $52,000; if you are filing as head of household, your income must be below $65,000; and if you are married filing jointly, your combined income must be below $78,000. Remember, though, that your rent or real estate taxes must be at least 10% of your income in order to qualify. So, if you are married filing jointly and your income is $75,000, your rent or real estate taxes must be at least $7,500. Also, be aware that income here includes social security, retirement, pensions, annuities, and other nontaxable sources.

If you have not yet filed your taxes, and you are interested in filing so that you can take advantage of this credit, there are many organizations that offer free tax assistance. The Circuit Breaker Tax Credit form is easy to fill out, and if it is the only reason you want to file a return, you should not over pay a tax professional. In Worcester, there are several VITA (Volunteer Income Tax Assistance) sites, and volunteers at these sites would be happy to prepare a return for you. You can also visit your local library to pick up the forms you need (Massachusetts Form 1 and Schedule CB), or visit this website to file your return electronically on your own. Finally, if you have not taken advantage of this credit before, you can file Massachusetts Form CA-6 (Application for Abatement/Amended Return) and Schedule CB to obtain the credit for the past three years.

photo credit: 401K / cc by 2.0

Regardless of the supposed ease of the new system, much work in still needed to be done by the Personal Representative (Executor) prior to the first meeting with the attorney. It can be extremely overwhelming to the surviving family members to figure out what items they need to gather. Below is a list of the kinds of paperwork needed after someone passes away to make this process less burdensome:

Asset Information:
Copies of the following documents will be needed:

• Account Statements – including bank, brokerage, and retirement accounts for at least the three months prior to death
• Life Insurance Policies – you can often obtain these directly from the company or life insurance agent if they can’t be located
• Beneficiary Designation Forms – for life insurance, retirement accounts, and payable on death accounts
• Deeds for Real Estate – copies are fine and can often be obtained electronically through the Registry of Deeds website
• Automobile and Boat Titles – the originals will be needed to transfer legal title
• Stock and Bond Certificates – for stocks or bonds held in certificate form, the original certificate will be needed to transfer legal title

Business Documents:
If the person who passed owned a business, then copies/originals of the following documents will be needed:

• Corporate, LLC or Partnership Documents – this includes copies of the corporate charter or articles of organization and minutes; a copy of the shareholder’s agreement, operating agreement, or partnership agreement; and original stock or LLC certificates to transfer legal title
• Account Statements – including bank, brokerage, and retirement accounts for at least the three months prior to death
• Automobile and Boat Titles – the originals will be needed if legal title will be transferred
• Contracts – including leases, loans, and employment agreements
• Business Licenses – including local and state licenses
• Income Tax Returns – past three years

Contracts:
Copies or originals of the following contracts will be needed:

• Prenuptial Agreements - including any amendments
• Postnuptial Agreements – including any amendments
• Loans - including personal loans, lines of credit, and mortgages, along with the original promissory notes
• Leases – including real estate and automobile leases

Bills:
Copies of the following bills will be needed:

• Utility Bills
• Cell Phone Bills
• Credit Card Bills
• Mortgages and Personal Loans – including lines of credit
• Real Estate Tax Bills
• Storage Unit Bills
• Medical Bills
• Funeral Bill

Estate Planning Documents:
If the person who passed had an estate plan, then copies or originals of the following documents will be needed:

• Revocable Living Trust and Any Amendments – often times a copy of the trust or amendment is all that’s usually needed
• Last Will and Testament and Any Codicils – the originals will be required because if the originals can’t be found it could be presumed the decedent destroyed them, however if all beneficiaries/heirs-at-law agree a copy can be produced in Massachusetts

(NOTE: For clients of Vickstrom Law, copies, as well as the originals, of your estate planning documents are provided to you in your Document Binder.)

Tax Returns:
Copies of at least the last year of the following tax returns will be needed:

• Federal Income Tax Returns
• State Income Tax Returns
• Gift Tax Returns

Death Certificates:
Multiple, original death certificates will be needed to settle the decedent’s affairs. We advise our clients to order at least ten.

Vickstrom Law handles matters in estate planning, elder law, guardianship law, and estate administration exclusively and serves the communities in and around Worcester County.  If you have just had someone pass away, we can assist you in the administration of your loved one’s estate.  Call our offices to schedule your free initial phone consultation with Attorney Kristina Vickstrom today at 508.757.3800.

Photo credit: triosmarteaux /cc by 2.0

Sources: Kavesh, Minor & Otis and Julie Garber, Esq.

Not necessarily. Even if you are single and/or have no children, a Worcester Wills and Estates lawyer like Attorney Kristina Vickstrom should still be in your plans. Why? Because estate planning is really about YOU.

While it is absolutely advisable for married people or those with children to work with an estate planning lawyer, it’s also just as important for single adults. After all, when a married person suffers a major illness, it’s usually pretty clear who will eventually take on their medical and financial responsibility. The water gets murkier for unmarried individuals.

If you were to suddenly become incapacitated, who would make your medical decisions for you? Possibly your parents would be called in to determine how your medical care should proceed. It might be your sibling. But what if you don’t get along with your brother? Even if your parent or sibling would be your first choice, that doesn’t mean that the courts would agree without having your wishes legally documented.

The person to make medical and financial decision on your behalf is whomever the courts decide! Again, it could be a parent, a sibling, some other relative, or even a court-appointed individual (a stranger!). While she was not single when she was hit with dementia, the children of the late signer, Etta James, fought repeatedly with their step-father over the management of her assets and health care. James should have documented her wishes and avoided a lot of the conflict, allowing her family to more fully enjoy her last moments.

Finally, who would have legal rights to your belongings, to your home, to your pets? You may think you know the answers, but without clearly outlining your wishes with a Worcester area Wills and Trusts attorney, you have very little control over the matter. Families can be torn apart by court battles involving an estate with no Will. Popular Swedish novelist Stieg Larsson, who died unexpectedly in 2004, had been living with his girlfriend of 30 years at his passing and had taken on no estate planning. A legal battlefield erupted over his assets, namely the rights to his successful publications. With the exception of an unfinished manuscript on a shared laptop, his girlfriend walked away with nothing and Larsson’s father and brother inherited everything. This also could have been avoided, or lessened, if Larsson had set up even the most basic of estate plans.

A single adult without children does not need to worry about creating guardianships and trusts to provide for his or her children, but it’s certainly a good idea to look out for yourself. Some of the basic legal documents any single person should have include:

• A Will to determine what will become of your assets in the event of your death.
• A Health Care Proxy to name the person you want making medical decisions on your behalf.
• A Power of Attorney for financial matters to name the person you feel should be responsible for your money if you are incapacitated.
• And possibly a revocable living trust to centralize management of assets if you become incapacitated and keep your assets out of probate if you should pass away.

These documents are crucial in ensuring that your wishes are met and that you have control over your future. One doesn’t need to a famous R&B singer or best-selling, author to need an estate plan. Everyone, including single people, in Worcester County, should consider estate planning.  Contact Vickstrom Law today to set up a consultation or to find out more information.

Photo courtesy of Bree Bailey

One of the biggest factors, of course, is that most people don’t want to consider their own mortality, and estate planning forces you to do just that.  When it comes to adult children, we are just as guilty of not wanting to think about the inevitability of losing our parents, and therefore, we choose not to push them.

There are other complex reasons that come into play as well.  An adult child who wants to encourage his or her parents to set up wills and trusts may worry that the parent or other family members will mistake concern for greed.  If the parent has remarried, then even more complex family dynamics can come into play, with the adult child remaining quiet on the subject rather than creating waves.

Elder law attorneys understand these considerations and so many more, but we also know what happens when advanced planning isn’t given enough attention.  When a parent passes away or becomes incapacitated without an estate plan, the fallout can be devastating.  It may fall to the courts to determine who should be given power over medical and/or financial decisions for the parent, and the court’s opinion often does not reflect the wishes of those involved.

Really, having a plan in advance of a tragic event is the best way to ensure it will be handled according to your parents’ desires; and framing the request in this way can be helpful.  At a time in life when they are finding themselves with less and less control, it can be reassuring to know that some of the most important decisions regarding health, money, and property are theirs to make; and that when they can no longer make those decisions, substitute decision makers of their choosing are ready to step in.

In order for this to happen, though, parents need to meet with their elder law attorney while they are still able to make sound decisions and legally sign documents.  Again, most people don’t want to think about losing their mental acuity, but it can be very common.

Creating wills and trusts and setting up powers of attorney and a health care proxy can give your parent the sense of control that they may feel slipping away.  During your discussions with your parent, it can also be helpful to point out that estate planning:

• Allows them to determine who they want to have in charge of their money
• Provides the opportunity to designate who will receive which assets (or none at all)
• Keeps the courts out of the process, or limits their involvement, saving time, money, and hassle for those left behind
• Ensures that THEIR wishes are the ones that matter
• Minimizes the taxes that will be paid out of the estae

Life is busy, and it’s easy to say that estate planning is something that we’ll get to “later.”  However, “later” doesn’t always come when you think it will.  Instead of leaving the decisions (and potential hassles) in someone else’s hands, empower your parents to have a say in their future and the future of their family. Contact Vickstrom Law today for more information about encouraging your parents to handle their estate plan and to set up a consultation.

Paula and Don have approached an estate planning attorney to modify their Estate Plan after the tragic death of their eldest daughter. Paula contends that the couple should designate the next in birth order as the Personal Representative, having one of their twin daughters, Laura or Molly, named. Don argues that their youngest son, Bobby, a financial advisor, should assume the role as the more practical choice. Who should be selected?

Choosing the eldest child, regardless of his or her ability to do the job, is not always a smart decision. Paula and Don’s Personal Representative decision should not necessarily be based on choosing the closest in relation, but about ensuring that their wishes are carried out in a timely fashion upon death. Due to the intricacies that go with the job, the most competent person should be chosen.

However, considerable knowledge about financial matters (like Paula and Don’s son) is not necessary. A Personal Representative can always seek assistance from an attorney or accountant familiar with the probate process. A more important consideration is whether your Personal Representative  has had financial problems of his or her own. He or she must be able to handle the tasks of estate administration without unduly burdening personal obligations.

If Paula and Don decide to follow the birth order of their children in selecting a Personal Representative, it is worth noting that multiple fiduciaries can be named. Such co-agent relationships might not be the proper choice if you are trying to avoid family disputes. Giving equal authority tends to encourage disagreements. Further, having to act in unison can prove to be cumbersome and slow down the probate process, particularly if Co-Personal Representatives live in different states.

Out-of-state persons can be appointed as Personal Representatives. Especially in the age of e-mail, fax, and overnight delivery, there is no issue with choosing someone who lives out-of-state. Yet generally it is ideal to appoint a health care agent who lives close to you. Reviewing medical records, conversing with physicians, and formulating a true picture of your condition is much easier for someone who lives nearby.

Keeping in mind the discussed considerations, Paula and Don should remember that the role of a Personal Representative is not a simple task that can be accomplished by anyone. Because of the complexity and involvement of the probate process, only intelligent, dependable, and trustworthy people should be named as Personal Representatives. To consult with an attorney on who might be the appropriate Personal Representative for your unique situation, contact Attorney Kristina Vickstrom at Vickstrom Law.