Posts

Estate Planning Attorney

What Recourse Do I Have if My Power of Attorney is Stealing From Me?

/in /by

Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers the following helpful answers to Powers of Attorney:

Can the Power of Attorney be used by the agent to take my money or property without my permission?

Unfortunately, you can run the risk that the agent you choose to give your Power of Attorney could abuse the power by spending your money or taking your money without your knowledge or worse without your permission. Because the agent can use the Power of Attorney to access your bank account and sell your property, it is prudent  that you not give your Power of Attorney to anyone you do not trust.  If you happen to have an unscrupulous agent, it can be very challenging to get back funds or property taken by the agent, because the agent usually has no money left to return as they have used it all for their benefit.  The person acting as your Power of Attorney has the power to sell your property, or mortgage it.  It cannot be stressed enough that you chose your Power of Attorney very wisely.

 

If I think someone is using my Power of Attorney to steal from me, what can I do?

If you are suspicious that your agent is abusing their powers, revoke the Power of Attorney immediately.

Next, without delay, notify all banks, brokerage firms, or other financial institutions in which you have money that you have revoked the Power of Attorney.

Finally, go to the probate court. You may either by yourself or through an attorney.  Demand that the agent you suspect of absconding with your funds file a detailed account showing how your money was spent. A filing fee will need to be paid by you and you may need to possibly pay the agent for the cost of preparing the accounting documentation. Next, the court will hold a hearing at which time you can challenge the any or all of the information given in the detailed accounting. Ultimately, if the court finds the agent took your money without your authorization, you can sue the agent and/or possibly press criminal charges.

 

Can I revoke my Power of Attorney?

The Power of Attorney cannot be used unless the agent has it or it, or at least a copy and either you or they have given to banks, financial institutions, or others so that they think you want the agent to act on your behalf. If you have not given the Power of Attorney to anyone, you can revoke it by destroying the document.

If the eventuality the Power of Attorney has been given to the agent, an institution, or has already been recorded, you should execute immediately a revocation of the Power of Attorney that is witnessed and acknowledged in the same manner as the first Power of Attorney. Then; just as you distributed the Power of Attorney initially, you will need to furnish a copy of the Revocation to the banks, brokerage firm, or any other financial institution, and anyone else that may have a copy of the original Power of Attorney form that they know the Power of Attorney is no longer valid.

A Power of Attorney is only one of the many parts to a comprehensive estate plan. For information regarding living wills, trusts, power of attorney, or a pour-over will, or further questions on Powers of Attorney, contact Daniel A. Baron of Baron Law today at 216-573-3723.

 

Estate Planning Lawyer

What’s the Difference Between a Living Will and Last Will and Testament?

/in , /by

Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers the following helpful answers to your questions about the difference between a Living Will and a Last Will and Testament.
Confusing these terms happens quite frequently as there are those that think that these are one in the same, however, they are entirely two distinct legal documents which cover many different needs.

A Living Will, what is it and do I need one?

 

 

Should you become extremely ill or completely incapacitated and cannot convey their medical care wishes; having a living will in place, (which is a legal document AKA as an advance directive), gives instructions as to the medical care you wish to receive.

Some of the details of a Living Will would include

  • Do I want to be placed on a breathing tube
  • Do I want a feeding tube
  • Would I rather not be resuscitated (AKA DNR – Do Not Resuscitate)

Also, at this point it would be wise to consider having a Power of Attorney put in place in the event that you do become incapacitated so that there is someone making sure that your wishes are carried out as you have communicated in your Living Will. Naming a Power of Attorney can be done at the time of penning your will.

 

 Last Will and Testament, is it different than a Living Will?

Your last will and testament, also simply known as a will, is a legal document that stipulates the transferring of your estate to somebody else by sale or gift upon your demise. Should you pass away without a will, your assets then become “intestate”.  At this time state intestacy laws govern the distribution of your assets.

If you have minor children, you should unquestionably have a will. At the same time of the writing of your will, it is possible for you to name a guardian for your minor children.  You can also name the guardian to manage the minor’s financial affairs or another party to act on behalf of the children.

As you are drafting your will, it will be necessary for you to select an Executor of your estate. The Executor is one who carries out the will’s requests throughout the process of probate.

Living Will and Last Will – when do they take effect?

Now that you are aware of the differences between a Living Will and a Last Will, you may question as to when the two take effect.

Keeping in mind that the Living Will outlines your medical wishes should you become incapacitated or seriously ill and unable to convey your wishes, this comes into play while you are still alive but unable to voice your wishes.

To stipulate your wishes of how to distribute your estate upon your passing comes into play by using a Last Will and Testament .

So as you can see a Living Will and a Last Will and testament are two separate, but very important legal documents for everyone to have in place.

Living Will vs. Last Will?

If you are pondering the questions as to whether you need a last will or a living will. The answer to that question should be very easy; just about everyone should have both. Each of these important documents are ones that every person doing their Estate Planning should secure as these offer you the peace of mind that your wishes will be followed when you can’t make them known due to a serious illness and/or incapacitation or death.

Having a last will and testament, also makes the probate process go more smoothly, and with a living will, it can provide direction to your loved ones or Power of Attorney, in making challenging decisions during a stressful and difficult time.

So when is the best time for me to get a living will and a last will?

Unless you have a crystal ball which states otherwise, the future is uncertain. Securing both a living will and a last will and testament and recording your wishes is best done sooner than later.

Both a Living Will and a Last Will and Testament are only two of the many parts to a comprehensive estate plan. For information regarding living wills, trusts, power of attorney, or a pour-over will, or further questions on Powers of Attorney, contact Daniel A. Baron of Baron Law at 216-573-3723 to make an appointment.

Living Will

Do I need a Living Will?

/in /by

Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers the following regarding living wills:

Before you can answer this question you must first understand what a Living will is and what purpose it serves.

A Living Will is one form of Advance Directive which clearly defines your wishes for medical care should the following occur:

A Living Will clearly states your health care intentions.  This document allows you to make decisions while still cognitive such as:

  • Whether or not you wish to be put on life support, even if for a very short time
  • Would you would like to receive pain medication of any kind
  • Is it you desire to have any nutrition available by means of a feeding tube

The Living Will document also allows you to list any further specific instructions for your care if you become fully incapacitated.

Another form to consider securing in conjunction with a Living Will is a Health Care Proxy which is a specific Power of Attorney. A Health Care Power of Attorney authorizes a specific person you have chosen to act on your behalf to make all medical decisions (or to make sure that your medical wishes in your Living Will that you have set forth are followed), in the eventuality that you are no longer able to make these decisions yourself.

It might be in your best interested to have both a Living Will and a Power of Attorney which will set forth comprehensive guidance when it comes to your medical care in the end stages of life.

Things to consider when completing these documents:

  • Who do I want and trust to make my health care decisions when I am no longer capable of making them on my own?
  • What kind of medical treatment DO I or DON’T I want?
  • How comfortable do I want to be when my life’s journey is coming to an end?
  • How do I want people to treat me?
  • What do I want my loved ones to know?

Having a Living Will is only one part to a comprehensive estate plan.  For information regarding living wills, trusts, power of attorney, or a pour-over will, contact Dan Baron of Baron Law to make an appointment at 216-573-3723.

Estate Planning Attorney

What Is a Power of Attorney and Do I Need One?

/in /by

Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers the following helpful answers to Powers of Attorney:

What is a Power of Attorney?

A Power of Attorney is a legal document you use allowing another designated person, of your choosing, to act on your behalf. It is a legal relationship in which you are the principal and the person you appoint is the agent.  A Power of Attorney outlines specific powers you give to your agent. The powers can be limited or broad. An example would be, you are selling your house, but are not able to attend the closing.  You can at that point give someone the power just to sign the deed in your absence.  Keep in mind that most durable powers of attorney, give your agent the power to do almost anything you could or would do.  In this example you may just limit the function of the Power of Attorney’s duties.

Some financial institutions, brokerage firms, or banks may require you to sign one of their own company specific Power of Attorney for their files.

Why do I need a Power of Attorney?

In the event you become unable to handle your own affairs as a result of illness, accident, or even being absent due to your job, the Power of Attorney gives your agent the power to handle your financial affairs as you would handle them yourself.  Since you might not be able to execute a Power of Attorney at a time when you are disabled due to an accident or become incapacitated, or should you become unable to handle your own affairs and have no Power of Attorney, your spouse or family may have to request the Probate Court to appoint a power of attorney on your behalf.  A Power of Attorney can be very helpful to both you and your family, as by naming your own agent and having a signed Power of Attorney avoids the expense of probate court and avoids naming someone who may not know and carryout your wishes.

Where should I keep my Power of Attorney?

As your Power of Attorney is an important legal document, it is recommended that you keep it in a safe and secure place. You may also want to give a copy to your agent(s) or in a safe and secure place where it can be easily found by your acting agent.  Your agent may also keep a copy in case yours is lost. It is also wise to make sure your family knows where to find your Power of Attorney, or whom to ask when it is needed.  And of course, your attorney will have a copy of the Power of Attorney.

What does “durable” mean?

The legal definition of ‘durable’ means the Power of Attorney will remain in effect even if the principal becomes mentally incapacitated. The powers you give to your agent will remain effective even though you are unable to give your agent updated instructions.  If you have an older power of attorneys or an out of state powers of attorney, many of these still have these words, and remain in effect.

When does the Power of Attorney take effect?

The Power of Attorney becomes effective immediately upon signing the document before two witnesses and having it notarized. The agent is able to use the Power of Attorney as soon as he or she receives it.  However, you may give the Power of Attorney to your agent(s) and tell the person(s) NOT to use it unless you are unconscious or unable to act for yourself.  It is imperative that you know and trust the person you are asking to be your Power of Attorney.

You may opt to use a “springing” Power of Attorney which would not take effect until a specific triggering event happens, such as you become incapacitated. However, there are several issues with springing Powers of Attorney.  The agent first needs an affidavit showing the triggering event has occurred before the Power of Attorney can be put into use.  Then, even though the law says banks and other institutions that accept the document with the affidavit are not liable, banks have been reluctant to recognize the agent’s power under a springing Power of Attorney. Ultimately, it isn’t clear whether such a document would be accepted in other states other than your own.

Does giving someone a Power of Attorney mean I don’t have control over my money any longer?

It does not. Although you still have the right to control your money and property after a Power of Attorney has been put in place, keep in mind, you are giving your agent the ability to access your money.  Although there is a risk that a dishonest or unscrupulous agent might steal your money, your agent is not supposed to use your funds in any manner with your permission.  It is therefore vital to choose an agent you trust. A sound idea would be to go over the agent’s duties before you sign your power of attorney.

Do I need to update my Power of Attorney if nothing has changed?

It is always a good idea to review your Power of Attorney periodically to make sure you still agree with your choices.

There are some banks, brokerage firms, and other financial institutions that will attempt to reject a Power of Attorney that is several years old. This is mainly due to the possibility that the Power of Attorney has been revoked.  This is a good thing, so that an unscrupulous agent that had their Power of Attorney duties revoked, does not gain access to your funds and deplete them.  There are several options to prepare for this. If you remain competent it is very wise to re-execute your Power of Attorney every five years or so.

If unfortunately, you are no longer competent; your agent can sign an affidavit that your power of attorney is in full force and in effect and provide that to the financial institution.

A Power of Attorney is only one of the many parts to a comprehensive estate plan. For information regarding living wills, trusts, power of attorney, or a pour-over will, or further questions on Powers of Attorney, contact Daniel A. Baron of Baron Law today at 216-573-3723.

estate planning

QTIP Trusts – Estate Planning for Those With Children From a Prior Marriage.

/in , /by

Cleveland, Ohio Estate Planning and Elder Law Attorney offers the following:

The main benefit of a Qualified Terminable Interest Property Trust is being able to control your estate after your gone.  In addition, there are several tax advantages for larger estates.

Each spouse can set up a QTIP trust, leaving assets to the other in trust.  When the first spouse dies, the survivor gets what is called a “life estate” in the assets that are left to the QTIP trust—that is, the survivor is entitled to any income the assets produce, and in the case of real estate, to its use. Only the surviving spouse can be named as the life beneficiary. The survivor does not, however, have full ownership of the trust assets and cannot sell them or give them away.

In order to qualify for the marital exemption, the spouse must receive all of the income from the trust and the Executor must make an election on the tax return.  QTIP’s are very similar to family trusts, or bypass trusts.  And in fact, many times you create a family trust in conjunction with a QTIP.  The difference is that QTIP’s are more restrictive and are useful for those who are in second marriages.

There may also be several tax advantages. Here’s an example:

  • Jim’s share of the marital estate is $12 million. He passes in 2016, leaving a spouse, Karen, and sons from a prior marriage. He had a revocable living trust, which becomes irrevocable upon his death.
  • Upon Jim’s death, his trust sub-divided into an “A” and a “B” trust. $5.43 million is diverted to his “B” trust. Karen is the beneficiary, with limited access.  Because this trust is under the federal estate tax limit, estate tax is $0.00.  Over the next 20 years, because of robust growth, the “B” trust is now $17 million.  Upon the Karen’s death, trust “B” passes to the son’s entirely estate tax free.
  • The remaining $6.57 million in assets are diverted to the “A” trust. Karen again has restricted access, but can use these funds for her health, maintenance and support. When Karen has expenses she uses the “A” trust and saves the “B” trust only for dire necessities.
  • Upon her death the “A” trust has been reduced (or eliminated) and the tax is minimal, if there is any at all. The remaining balance of the “A” trust goes to Jim’s sons.

There are many advantages to setting up a QTIP trust.  Every estate plan is unique and its important to contact an elder law and estate planning attorney who can analyze your estate.   Contact Cleveland, Ohio attorney Dan A. Baron at 216-276-4282 to learn more about QTIP or other trusts.  Baron Law is a Cleveland, Ohio law firm.

cleveland, ohio attorney

Difference Between a Trustee and Executor Within a Testamentary Trust

/in , /by

Cleveland, Ohio Estate Planning Dan A. Baron Explains the Difference Between an Executor and Trustee:

Estate planning can be complicated and sometimes difficult to bear when charged with the responsibility as executor or trustee of an estate. If you have minor children, then you probably have set up some form of testamentary trust coupled with your will and power of attorney. Within these estate planning documents, there are designated executors and trustees that have been carefully selected to administer your estate after you pass. It’s important to talk with your executor and trustee and let them know their responsibilities after your’re gone. Below is a quick summary of the difference between executor and trustee of a testamentary trust.

The Executor’s responsibility is to liquidate or otherwise gather all estate assets, pay any outstanding bills and then transfer assets from the name of the decedent to the beneficiaries named in the Will (most often the decedent’s children). They also make any necessary filings with the court and attend any court hearings. Most Executor’s elect to use an attorney to help them with this so the process runs smoothly. Once all assets are in the name of the beneficiary, the Executor’s job is done. The complexity of the estate will determine how long the Executor is needed.

In comparison, a Trustee receives the assets from the Executor and then, with court approval, invests the trust assets in savings account, investment accounts, or whatever they deem appropriate. Most importantly, the Trustee manages the funds and makes distributions to the trust beneficiary (usually children) when needed (i.e. to pay school tuition, living expenses, doctor bills, etc.). Most clients set a maturity age of 25. When the children reach the age of 25, the trustee distributes the balance of the trust funds and that particular child’s trust is terminated. The Trustee will be required every two years to make reports to the court as to the value of the trust. As you can imagine, the length of time the Trustee will be needed will depend upon the age of the children.

If you would like to learn more about the responsibilities and an executor and trustee, or have questions, contact our office at 216-276-4282. You will speak directly with an Cleveland, Ohio estate planning attorney who can help you set up a trust, will, power of attorney, medicaid planning, and more. If you would like to attend one of our FREE seminars, please visit this link.

Cleveland attorney

Springing and Durable Power of Attorney – What’s the Difference?

/in /by

Springing and Durable Power of Attorney – What’s the Difference?

When planning for retirement and your estate plan, it’s important to understand how your power of attorney works.  Generally, there are two kinds: springing and durable power of attorney.  A springing power of attorney takes affect if you become incapacitated.  In comparison, a durable power of attorney becomes effective as soon as you sign the document, and continues to be effective if you are incapacitated.

Having control with a power of attorney is a big deal.  The person holding this power may have the ability to control your financial assets, medical decision, and more.  For example, a giving someone financial power of attorney powers gives them the right to make financial decisions on your behalf.  This person might trade stocks, cash in annuities, or transfer assets.  If this person has durable power of attorney, they can make these decisions even if you are not incapacitated.   State laws differ on the particulars of power of attorney, and some financial institutions may require their own versions.

With a springing power of attorney, it’s important to clarify exactly what triggers someone taking over your abilities to make decisions.  Typically, it’s when the principal becomes disabled or mentally incompetent.  However, it could be used in a variety of situations.  For example, someone in the military might create a springing power of attorney form to be prepared for the possibility of being deployed overseas or disabled, which would give a relative powers to handle financial affairs in these specific situations only.

Who determines when someone is mentally incompetent or incapacitated?  This question varies state to state.  However, in general there is usually a formal procedure that your attorney can create.  It’s smart to note in your legal document exactly what the principal considers “incapacitated” to mean.  Often times, people who create a power of attorney form include language that requires a doctor’s certification or mental incompetence or incapacitation.

For more information regarding power of attorney and other estate planning methods, contact Cleveland estate planning attorney Dan Baron at Baron Law LLC.  Baron Law is a Cleveland, Ohio area law firm practicing in estate planning, business, and family law.  Contact Dan Baron today for a free consultation at 216-573-3723.