Spring Cleaning For Your Estate Plan

By Karen S. Timko, CELA

Julian Gray Associates

It’s time to rake out the flower beds, plant annuals, clean out the garage and get ready for the warm weather.  Spring is also a good time to take stock of your estate plan.  We recommend that you review your estate plan annually especially if your health or finances have changed in the past year.  In the course of your review, we suggest that you consider the following documents:

General Durable Power of Attorney (“financial POA”)      The financial POA is your most important estate planning document.  In this document you name an Agent to stand in your shoes and make all financial decisions for you if you become unable to manage your finances.  We suggest that you name two successor Agents to serve in the event a prior Agent is unable to serve. If you do not execute a financial POA or no Agent is able to serve, your family will be required to petition the Court to have a judge name a guardian to manage you financial affairs if you lose capacity to manage your finances.  Pennsylvania financial POA law changed effective January 1, 2015.  Your financial POA must now specifically grant your Agent certain powers if you want your Agent to have such powers.  It is important that your financial POA include powers to handle all of your affairs including  protecting  assets from the cost of long term care. 

            Healthcare Power of Attorney with Living Will     (“Health Care POA”)  We usually combine these two documents into one document called an Advance Health Care Directive.  In order to trigger either document your physician must first determine that you are unable to make you own healthcare decisions. In the Health Care POA you name an Agent to make health care decisions for you.  We suggest that you name successor Agents to serve in the event a prior Agent is unable to serve. Note that if no Agent can serve, your healthcare providers will consult your closest relatives to make your healthcare decisions.  The Living Will contains your wishes regarding the receipt of life sustaining treatment in the event you cannot make your own decisions and your physician has determined that you are either suffering from an irreversible coma, a persistent vegetative state or an end- stage medical condition from which you are not expected to survive even with medical treatment.  It is important to state your desires in your Living Will about the receipt of life sustaining treatment under the above conditions so that your healthcare providers have legal authority to honor your wishes.

            Last Will and Testament or Trust   The terms of both a Last Will and Testament (“Will”) and a Trust dictate how your property will pass upon your death.  However, a Trust contains further provisions to manage assets during your lifetime. Assets held in Trust also avoid probate, which is time consuming, can be expensive and makes the value of your estate and the identity of your beneficiaries a matter of public record.   Because of the increased incidence of disability in our world, we recommend that your Will and/or Trust also include a Supplemental Needs Trust that will hold any inheritance to be received by a beneficiary who is disabled and receiving needs-based government benefits so that the receipt of the inheritance does not render your disabled beneficiary ineligible for government benefits. You may also want assets to be held in trust for your other beneficiaries until they are able to wisely manage their inheritances.

            Asset Protection Trust An irrevocable Asset Protection Trust holds assets to shelter them from the cost of your long term care and reduces or eliminates inheritance tax for your beneficiaries.

            Retirement Plan Trust This Trust holds your retirement plan assets after your death and is an excellent vehicle  to aid your beneficiaries in stretching retirement assets throughout their lifetimes.

            Beneficiary Designation Forms   We suggest that you review all beneficiary designation forms to be sure that they are correct and that the designations comply with your comprehensive estate plan.

We recommend that you review all of your documents listed above to update the current terms of the documents.  You should also review your beneficiaries, and the identity and order of the persons you name to serve as your Agents under your POAs, Trustees of your Trusts and Executors of your Will.  We suggest that you update your documents so that they reflect your wishes for today and the immediate foreseeable future.  You can always revise your documents at a later date as your life changes. 

Once you have reviewed and perhaps updated your documents, it will be time to relax on your patio and enjoy the upcoming dog days of summer knowing that your estate plan Spring cleaning is complete.

 

Contact us

Questions? Contact us at Julian Gray Associates

Julian Gray Associates
954 Greentree Road | Pittsburgh , PA 15220
Phone: 412-458-6000
http://www.GrayElderLaw.com