Estate Planning For Women (And the Men Who Love Them)

A fellow attorney (and award-winning journalist) Deborah Jacobs authored the book, “Estate Planning Smarts: A Practical, User-Friendly, Action-Oriented Guide”.  In her recent Forbes article titled “Estate Planning for Women (And the Men who Love Them)” she indicated the below question is a question every financially savvy woman should be able to answer. 

Question #3

Whom can you trust?

Advancements in medical science and care may enable us to live fuller, longer lives. But that also means more women are likely to suffer from a diminished mental state--a harsh reality that's difficult to accept. In case that happens, you should have a durable power of attorney, appointing a family member, friend or adviser as an agent to act on your behalf in financial and legal matters. Also make sure you have a health-care proxy, a separate document that authorizes an agent to make medical decisions on your behalf.

Choose carefully: A power of attorney, though necessary for all of us, is unfortunately also a license to steal. The best person to put in charge is a close family member--preferably one who lives nearby. Most financial advisers do not want this responsibility, nor is it cost effective to pay their hourly fee to handle routine tasks like paying bills. Naming joint agents, which is allowed only in some states, is one way to provide checks and balances. Or you can appoint another person, like an attorney, an accountant or a family friend, to supervise the arrangement. Before selecting an agent, it is important to determine whether that person is willing to take on the duties.

If you're nervous about giving the signed document to your designated agent right away, you could leave it with your lawyer with instructions on when to turn it over. In that case, remember to tell your agent whom to contact.

Or, instead of making the power of attorney effective from the moment you sign it, you can specify that it be activated by a specific event, for instance, if you become incompetent. The problem with this approach, known as a springing power, is that someone must decide when you have reached that state. Traditionally, this has required a medical opinion.

Questions like this one can often trigger even more questions in your mind.  Please accept my invitation to schedule a meeting where we can discuss this topic and others that might be relevant to your estate planning.  Give my office a call to set a meeting.

 

Medicare information is easier to find than ever

Medicare is a term well known to Americans. What it is, exactly, is less well known. And the big question of who qualifies for Medicare and what that means leaves many of us out in the cold.

Here's the good news. The days are over when your best avenue of research on the topic involved searching for educational pamphlets in public buildings, waiting to see a news report that explained a few details, or asking friends and family to give you their best guess. Thanks to the convenience of the Internet you can find good, solid information about this country's great social insurance program twenty-four hours a day. If you've got questions, you very well may find the answers you're looking for at a website with the easy to remember address of; Medicare.gov.

Under some circumstances the information you find on the website may lead to more questions than answers. But that's actually good. Because when you're armed with educated questions, your odds of finding educated and accurate answers go way up.

One of the more important pieces of information you will find at the U.S. Government's Medicare information portal these days is the news that Medicare open enrollment runs from October 15 – December 7, 2011. Whether you determine it's best to join, or drop coverage, or switch your health or drug coverage – this is the time to do it, and this is a great place for you to start your search for information about the available options.

Health care is a critical need. Going along with that need is the realization that our health care solutions have to be affordable for us to make the most of them. With that in mind, I hope you will make good use of this free resource that can help you make your selections, or at least help you determine which aspects of Medicare you would like to be more aware of.

Don't fall prey to the 2011 "Dirty Dozen" tax scams

The IRS has identified the "Dirty Dozen" tax scams of 2011.  Participating in or falling victim to them can result in real harm to your pocketbook and your freedom.  My WealthCounsel colleague, Scott Makuakane, practices in Hawaii and he recently posted five of the Dirty Dozen.  He noted that he did not list them in any particular ranking of "dirtiness":

Hiding income offshore

People used to be able to get away with this because of the IRS' former inability to track offshore accounts.  Things have changed, and penalties have been increased.  Any tax strategy that requires secrecy as an element for success is highly suspect and probably should be avoided. 

Identity theft and "phishing"

It is absolutely critical to protect  your personal information.  All an identity thief needs are your name, birthdate, and social security number to make your life a living hell.  Watch out whenever anyone asks for those bits of information, and protect yourself by shredding documents that may contain sensitive information about you before you discard them.  Also beware that identity thieves are out there trying to gather your personal information any way they can--through email, by posing as government personnel, by spyware programs that can steal passwords from your computer, and a variety of other nefarious means.

Return preparer fraud

Be careful who you trust with preparing your returns.  If you have a fairly complicated return, it would behoove you to work with a CPA.  In any event, be sure to work with trustworthy professionals in whatever you do.

False or misleading forms

Some folks claim refunds to which they know they are not entitled.  Obvious no-no.  Don't file a return that does not pass the smell test.

Frivolous arguments

People sometimes make the darndest arguments.  Here is one that will land you in the pokey.  Premise 1:  there are ample declarations by the IRS in a variety of publications that our income tax system is "voluntary."  Premise 2:  I have the right to opt out of any "voluntary" income tax system.  Conclusion:  by golly, I will opt out of the U.S. income tax system and there is nothing anybody can do to me if I do. 

Please don't get caught up in any "strategy" that would seem to enable you to evade taxes.  Tax avoidance or minimization through recognized legitimate means (such as deductions for charitable contributions and mortgage interest) is good stewardship.  Tax evasion is a crime, and it will eventually catch up with you.

You can check out the rest of the "Dirty Dozen" on the IRS website.  For some information on legitimate approaches to estate planning, please contact me and we discuss the legal path offering confidence in your estate planning.

The marriage fizzles, but the television show is a hit!

Was it real, or was it entertainment? Britain's Daily Mail is running a story about the Kim Kardashian/Kris Humphries marriage that lasted only 72 days. The story asks that very question. Was it love, or was it a hoax? Could this have been a real marriage, or just a staged wedding intended to pull in a huge and hugely lucrative audience?

Humphries, a professional basketball player who is currently idled by the NBA lockout, arguably gained more fame and notoriety as the suitor of a highly visible reality television star than he ever did on the court. Kardashian, for her part, boosted the ratings of her family's personality driven entertainment empire to stratospheric levels as the fledgling romance, engagement, and ultimate marriage tantalized viewers and drew them in by the hundreds of thousands.

The two met, ironically enough, exactly one year before the divorce papers were filed. That timeline certainly meets the definition of a whirlwind romance. The discussion around water coolers and executive suites isn't about romance or broken hearts, or infidelities, however. It's about money. And it is that exact issue that has casual viewers and professional celebrity watchers alike wondering, was this ever a real romance in the first place, or was this just business?

Reports suggest that a prenuptial agreement will keep either side from flirting with poverty over the split. But the $10 million dollar televised wedding turned out to be an investment that worked beautifully on the professional level, while it was simultaneously a complete bust on the personal side.

Make no mistake, there are real people involved in this situation, and it's entirely possible that there are seriously hurt feelings that are leading to legitimate emotional pain as the story unfolds. But there are many, many dollars at stake, too. There is a television series in the mix, at the very least – which the Daily Mail report suggests has led the network to engage in emergency meetings, where one can only assume that damage control is the primary focus of the discussion, while questions on how to exploit the unexpected twist of events to their entertainment oriented advantage comes in a close second.

Whatever the case, whether it was love and loss, or ratings and bigger ratings – this story isn't going away any time soon. And neither are Kris or Kim.

You can read the full Daily Mail story here.