Andrew Ewalt's Law Blog

Where To File Important Documents

Every one of us accumulates important documents during our lifetimes, from investment and banking information to our estate and important personal papers.  One of the most important things to consider is where to file these records. 

When it comes to documents such as deeds to property, stock and bond certificates, life insurance policies and estate planning documents such as wills and trust one of the safest places is in the bank safe deposit box. However, keep in mind that unless the box is owned jointly with other individuals or owned in a trust (like a living trust) the contents may become inaccessible if the single owner becomes incapacitated or dies, thus requiring a probate court order for access by family or estate fiduciaires. 

For documents like brokerage statements, tax returns and other personal records these documents can be kept at home.  I often recommend that a fire proof safe or box be purchased (some are rather inexpensive at the local box retail store) to keep important papers at home. They are not 100% guaranteed but do a better job then a shoe box. 

Pre Planning Your Funeral

Many of my clients are starting to consider the option of preplanning (and even prufunding) their funerals.  This can be very important especially for individuals who are faced with long-term care in a nursing home, because the government allows and even encourages the prefunding of funeral expense up to $5,400.00.  Here are some thoughts on why to consider preplanning your funeral. 

1.  Preplanning lets you make your wishes known, so your loved ones won't have to worry. They won't have to wonder if they made the right decisions. 

2.  Preplanning will helps reduce emotional overspending by your family and loved ones from grief or guilt.

3.  Preplanning gives you a chance to personalize your funeral and make it a celebration of your life. Often your family just don't know what you would have wanted.

4.  Prefunding helps relieve you and your family from future financial responsibility.

5.  Peace of mind. 

Amending A Will

Typically, the first stem in estate planning is to prepair a will.  If you do not have a will in place, this requires your immediate attention.

However, lets say you already have a will in place, but your situation has changes in the time since you drafted the will.  In these situations , you may be able to add onto or modify your existing will with a codicil.

In order to be binding, a codicil must be handled with the same legal formalities as a will and should be drafted by an attorney.

Found Money?

I recently had an interesting client matter that got me thinking about how a person might find money they did not even know was owed them.  It turns out there are thousands of people like this right here in Connecticut – 600,000 names of individuals with unclaimed proceeds from unclaimed property and the demutualization of insurance companies. The Connecticut Treasury returned $10.8 million to rightful owners during fiscal year 2004.

You could be next.  The Connecticut Treasury still has millions of dollars more to give back.  And it is so easy to find out if your one of them.  Take a look for your name or the names of someone you know. Businesses may also have unclaimed property.  Searching the list is easy. Just click on this link and follow the directions. 

www.nameitandclaimit.org

GOOD LUCK!

Pet Trust

Have you considered who will care for your pet(s) if you die or become disabled?  Most likely not.  Often people assume they will survive their pets  so they do not plan accordingly.  The Humane Society of the United States encourages pet owners to carefully  consider the ramifications of failing to adequately provide for pets.  In this light, specific pet trust legislation has been enacted in approximately 31 states and the District of Columbia. These laws permit a person to create a trust for the care of designated domestic or pet animals and specify that a pet owner's intent to provide for their animal can now be protected by the courts. Unfortunately, under current Connecticut law, a pet owner cannot create a trust or will to provide for the care of the pet after the owner dies.  However, legislation has been presented to the Connecticut Legislature that would allow for the creation of a Pet Trust for domestic animals. Never-the-less while we are waiting on the Legislature there are still options for Connecticut residents who own pets.  These options should be discussed with your attorney when you meet to discuss your will. 

The Team Approach

When considering a legal, financial, tax or insurance consultation it is very important to find advisors who see themselves as a member of a team because not every situation or question can be addressed by any one individual advisor.  In addition to answering questions the team members can help put pieces of the puzzle together which might have been overlooked otherwise.  For example, in my practice I rely a great deal on the advice and expertise of the CPA’s, Financial and Insurance professionals we work with.  They provide me with resources that I would otherwise not have or even understand.  For example when working with a client on an estate matter we may need net worth and asset information that may only be available from the clients financial planner, for important tax information we may need to turn to the clients CPA, and for insurance that would best fit with the will or trust planning we are doing we must get help from the clients insurance agent.  Without these advisors working together and being on the same page the clients planning may never fully come together, be counterproductive or may even result in a negative outcome.  My office works with other professional advisors to help you accomplish your goals and objectives in the most cost effective and timely manner possible. If you have questions about how the “Team Approach” can help you accomplish your goals and objectives please contact me so we can discuss your matter. 

Power of Attorney vs. Revocable Living Trust

One of the many questions I receive from clients is whether there is a preference between a Power of Attorney and a Funded Revocable Living Trust when it comes to handling assets after disability? There are a number of reasons why a fully funded Revocable Living Trust is preferable over a Power of Attorney. Here are a number of reasons to consider:

1.  Banks and other financial institutions are more comfortable and familiar with the authority granted to a trustee then they are to the authority under a Power of Attorney. The Attorney-n-fact under a Powers of Attorney operate under the law of agency where trustees operate under the fiduciary or trust law. 

2.  Many banks and financial institutions will not recognize a Power of Attorney that has not been drafted in accordance with their own formate. 

3.  There are often regional differences in acceptance of Power of Attorney. Some locations will recognize them readily (perhaps too readily in some cases!), and in others, banks are very reluctant to recognize the Power of Attorney.

4. If the Power of Attorney is also a "Springing" Power of Attorney (i.e. the Principal has become incompetent thus allowing the Power of Attorney to spring into effect) difficulty arises in getting financial institutions to recognize the authority of the Attorney-in-fact because they demand sufficient proof that the Power of Attorney has actually "Sprung.

Preserve Your Legacy of Values

When completing your Estate Plan also consider an ethical will.  Though not a legal documenta an ethical will is a way to share your values, beliefs, life lessons, and hopes for the future, love, and forgiveness with your family and community.  An ethical will reflects the “voice of the heart.”  Every ethical will is as unique as the person writing it.

After reading a number of ethical wills, there are common themes that run through many of them. Sometimes they contain burial instructions, blessings, and personal and spiritual values. 

Here is a partial list of common themes seen in many ethical wills.

• Important personal values and beliefs
• Important spiritual values
• Homes and blessings for future generations
• Life’s lessons
• Love
• Forgiving others and asking for forgiveness

There are many personal reasons for writing an ethical will.  We all want to be remembered, if we don’t tell our stories and the stories from whom we come, no one lese will and they will and they could be lost forever, it helps you identify what you value most and what you stand for, future generations will have a better understanding of our values. 

If preserving your personal legacy would be an important aspect to your overall estate planning goals then seek out an attorney familiar with the process.  Regardless of your overall estate planning needs and goals an ethical will is a good way to share your values, beliefs, life lessons, hopes for the future, love, and forgiveness with your family and community.

Planning Considerations for Same Sex Couples and Civil Unions

For same-sex couples living in Connecticut, civil unions are now an exciting reality (Massachusetts, California and Vermont offer similar alternatives).  If you live in Connecticut (or one of the other 3 states) you and your partner now have new options, decisions and concerns that same-sex couples have never previously had. One of the many issues that should be considered is inheritance and death taxes.  Without a legal union, a couple will need to sign a number of agreements to create even a partial framework of protection in the event of death or incapacity, and certain tax benefits are forever denied same-sex couples, union or not.  With a civil union the surviving spouse generally inherits the estate based upon the terms of a written will or living trust and/or the terms found in the intestatacy statute (the statue which outlines how an estate should be distributed when a person dies without a will).  Other considerations are the implementation of living wills, health care directives and powers of attorney.  Spouses by civil union or marriage are not automatically granted the authority to act on each others behalf. Thus, it is very important to execute the appropriate documentation in order to avoid difficulty if a spouse becomes incapacitated  or is deemed incompetent to act for themselves.  Estate and gift taxes are another concern. Laws exempting married couples from inheritance taxes and gift taxes at the federal level do not yet apply to same-sex couples, because the federal government does not recognize same-sex unions even where state law approves.  However, Connecticut has its own death and gift tax which can affect same-sex couples who have civil unions in Connecticut.  It is very important when considering a civil union to think about  all of the legal pros and cons.  As with married couples once the decisions has been made to move forward with the civil union same-sex couples must protect themselves, their affairs and families by implementing the appropriate planning.

Labor Day

Labor Day is an important day to reflect on all of the woman and men, past and present who have worked so hard to make this country what it is today. Given all the ups and downs and all the turmoil we have been faced with lately I want to extend my appreciation, thanks and best wishes for a happy  and safe Labor Day weekend.