Paul O. Dillon, Attorney at Law

How Estate Plan Protects Your Family

Estate planning is one of many ways to make a difference to your family’s future. Whether starting from scratch or revising a will created many years ago, your estate plan gives you control over your assets and secures your loved ones. The title of a recent article from Florida Today says it all: “Your family’s future is important to you. These estate-planning tips can help secure it.”

If you don’t have a will, get started on this part right away. A will outlines how you want assets to be distributed upon your death. Without one, the probate court in your jurisdiction will determine who receives your property, and while you may not be around to see the results, your family will. If you have a will but haven’t reviewed it in a while, you’ll want to know if it still makes sense for you. Life is all about changes, good and bad, and your will should reflect your current life.

Living trusts keep assets in the family and pass from one person to the next without court involvement. Property owned by a trust goes directly to the beneficiaries without going through the probate process. Even better, trusts are used to appoint a trustee who will manage the assets if you become incapacitated. A trust works while you are living and after you have died. Families with significant assets, blended families and anyone looking for a smooth way to pass assets to loved ones rely on trusts.

People underestimate the importance of a Power of Attorney. A durable power of attorney gives a person of your choosing the legal authority to act on your behalf in financial matters. If you are too sick to pay bills or manage investments, an agent (the person named in the POA) can act on your behalf. Without this document, your family must petition the court to appoint someone to manage your life. The court has no obligation to name a family member or even someone you know to oversee your life. It’s far better to simply have an estate planning attorney create a POA suited to your needs.

You’ll also want an advance healthcare directive, sometimes called a living will, to express your wishes for healthcare in case you can’t. This document includes your wishes regarding life-sustaining treatments, organ donation and end-of-life care. The healthcare directive serves two critical purposes: it allows you to state your wishes and spares your family from not knowing what you want during a healthcare crisis. An emergency is no time for your children to guess what Mom wants.

Beneficiary designations are used in many financial accounts to allow the asset to go directly from the original owner to the beneficiary without going through probate. Beneficiary designations override your will. If you want your nephew to inherit your IRA but your IRA’s beneficiary designation is your spouse, your nephew gets nothing. People who have been divorced need to be extra careful about making sure their beneficiary designations are updated.

Parents of minor children must designate a legal guardian in their estate plan. Establishing a trust to own an inheritance for healthcare, education and living expenses ensures that their guardian will have funds to care for the children. Minors may not inherit property, so making a trust is the best way to protect and control their inheritance.

An estate plan, including a will, power of attorney, healthcare directive and trusts, is central to protecting your family and their future. An experienced estate planning attorney will help identify your concerns and know how to address them in a legally enforceable manner.

Reference: Florida Today (Feb. 8, 2025) “Your family’s future is important to you. These estate-planning tips can help secure it.”

Why Is Estate Planning Important?

Estate planning is part of long-term planning, no matter what the size of a person’s investment portfolio or their total net worth. It protects the individual and their property, which is why everyone needs an estate plan. Estate planning is an umbrella term used to refer to everything from asset allocation after death to planning for incapacity and end-of-life healthcare decisions, according to a recent article in The Daily News, “What to know about estate planning.”

Typical components of an estate plan include a last will and testament, power of attorney, healthcare directives and trusts. Most surveys conducted in the last few years show only a third of all American adults have a will, and more than half think they don’t need an estate plan because they don’t own enough assets.

Here’s all you need for an estate plan to protect yourself and your loved ones:

A will is the document used to distribute assets after your death. Working with an estate planning attorney who knows the laws of your state is the best way to ensure that your wishes are followed. Trying to do this on your own or with an online platform puts your will at risk of being deemed invalid by the court, which would put your entire estate into the hands of your local probate court.

The will is used to name an executor to carry out the directions you’ve expressed in the will. It is also used to name a guardian if you have minor children. Without a will, or if a will is found to be invalid, the court will name someone to take over distributing your assets. If you have young children and both parents are deceased, the court will decide who should raise your children.

Trusts are used to protect assets, minimize taxes and safeguard assets for beneficiaries. There are many different types of trusts, and an experienced estate planning attorney will know which type is best for your family. For instance, if a family member is disabled, you may need a Special Needs Trust. Your estate planning attorney will also discuss whether you need a Revocable or Irrevocable Trust.

Trusts are used to shield assets from creditors and may be part of Medicaid planning. Another benefit is that assets in a trust don’t go through the probate process. If you are concerned about disgruntled family members poring over your will—which becomes a public document after it is entered into probate—you may wish to use a trust to keep your estate and your assets private.

Planning for incapacity is an integral part of an estate plan. Suppose you become incapacitated without any estate planning. In that case, your family will need to go to court to be able to speak with your doctors, talk with the health insurance company and take part in your healthcare decision-making. Court proceedings are costly and take time; they are not something you want to be embroiled in during a health emergency.

Your estate plan should include a Power of Attorney, which names another person to act on your behalf if you are incapacitated. You’ll also want a Healthcare Proxy to permit another person to make medical decisions on your behalf. An Advanced Directive will express your wishes for what kind of care you want if you can’t communicate your wishes.

Having an estate plan expresses your wishes for more than your property distribution. If you don’t have an estate plan, contact an estate planning attorney to discuss your intentions for assets, beneficiaries and your future. Most people are surprised at how relieved they feel once this task is taken care of. The peace of mind knowing you and your family are protected is well worth the effort.

Reference: The Daily News (Jan. 30, 2025) “What to know about estate planning”

Living Your Best Life Solo? You Still Need an Estate Plan

Whether relying on informal networks of “found” family, trusted friends, or professionals, solo agers must plan for the inevitable aging events. A recent article, “Solo Aging: Planning for Your Best Life,” from The National Law Journal, shares the details.

Most importantly, decisions about health care and end-of-life care need to be documented as part of your estate plan, and a person you trust implicitly needs to be named in the role of your healthcare proxy. You’ll need to make sure they are comfortable in this role and willing to enact your wishes, even if they disagree with them. They will also need to have access to the estate planning documents needed, including a Healthcare Power of Attorney, Living Will, HIPAA Release and any other documents your state may require.

You’ll also want to have a Power of Attorney prepared by an experienced estate planning attorney, naming a primary and a secondary person to manage your financial and legal life if you become incapacitated. If your candidates are around the same age as you, remember they may not be able to act when you need them to, so, if possible, name younger people to serve if they cannot.

Think beyond the basics. Depending upon where you live, you may want to have a POLST (Practitioner Order on Life-Sustaining Treatment) or MOLST (Medical Orders for Life-Sustaining Treatment) to state your wishes regarding life-sustaining treatment. Some people do not wish to have CPR performed on them in the event of a cardiac arrest and have a DNR (Do Not Resuscitate) document.

You’ll want to have a financial care plan to address emergencies. Seniors 65 and older are nearly 70% likely to need some long-term care in the next two or three decades of their life. If you don’t already own a Long-Term Care insurance policy, it’s time to consider whether you can purchase one. These are now often sold as part of a life insurance policy.

A last will and testament is needed to direct the disposition of your possessions after you die. If you don’t have one, your state’s laws will govern who receives your assets. Even if you have a long-standing relationship with a partner or best friend, they have no legal rights to inherit your property. A distant relative may be located by the court and inherit everything you own instead.

A last will is used to name an executor to manage your estate. This person will be responsible for more than distributing your assets. They are also tasked with gathering information about financial accounts, applying for a tax ID number for your estate bank account, gathering assets and placing them into the estate bank account, paying your final taxes, notifying Social Security of your passing, and filing an estate tax return.

Today’s estate plan includes planning for digital assets, so your social media accounts, emails, online photos and videos, gaming, subscriptions, cryptocurrency, and all other digital accounts are managed.

For the solo ager, having an estate plan protects you while you are living and protects your estate after you have passed. It takes some extra steps when compared to the planning done by married people. However, the peace of mind of expressing your wishes is the same, and you deserve this.

Reference: The National Law Journal (Jan. 10, 2025) “Solo Aging: Planning for Your Best Life”

Estate Planning Is Essential for Unconventional Couples

A sad story appears in a recent issue of The Parkersburg News and Sentinel, “Legal-Ease: ‘How things might have been.’” It explains what happens to a couple who had lived together for three decades but never planned for each other’s illness or death.

When Bill became ill, his overbearing brother commandeered the hospital room and refused to let Bill’s companion of thirty years, Denise, visit. When Bill died, the same brother barred Denise from the funeral home. Denise was left out of Bill’s obituary and made to leave the home she and Bill had lived in for many years. The brother cleaned out the entire house. He also took the couple’s beloved dog.

Bill’s brother was well within his legal rights to do all of these things, since the couple had never done any estate planning to protect each other. There are many things that they could have done to protect each other.

Bill and Denise should have created and executed medical powers of attorney, naming each other to make medical decisions when they could not make their own decisions. This document would have given Denise the legal power to be in Bill’s hospital room and talk to his physicians. It would also have ensured Denise’s ability to visit Bill and arrange care for him either in a nursing home or at home.

They could have also used the Medical Power of Attorney to nominate each other to be appointed by a court as a guardian if ever needed, avoiding Bill’s brother’s taking control of care by a court order.

If the couple had created Living Wills stating their choices for end-of-life care, each could have made sure they knew what the other wanted and ensured their wishes were followed. For example, a Do Not Resuscitate (DNR) order is used to prevent healthcare providers from performing CPR on patients if they have a heart attack while incapacitated. CPR can leave patients with broken ribs and punctured lungs, and some elderly patients or those near the end of life often choose not to have CPR. Without a DNR order, healthcare providers or emergency responders must, by law, perform CPR.

At the very least, Bill and Denise should have each signed a Durable Power of Attorney, naming each other as their representative for all legal and financial matters. This would have allowed Denise to take care of Bill’s financial and business matters. Bill could have also added a provision in the POA stating that he did not want his brother to be involved.

For unmarried couples, trusts are used to provide protection for the surviving partner. For instance, if the house had been put into a trust with Denise as a trustee, Bill’s brother would not have ownership of the home, and Denise would not be unhoused.

Bill and Denise could have named each other as beneficiaries on a variety of financial accounts, including life insurance, IRA accounts and investments. Upon Bill’s death, these assets would have been paid directly to Denise.

If Bill and Denise had used wills to name each other as executors as well as heirs, they could have left all their worldly possessions to each other and served as administrators of each other’s estate. While a will is not as bullet-proof as a trust, having a will could have protected Denise from being left out in the cold.

Regardless of marital status, couples who want to take care of each other throughout their lives should meet with an estate planning attorney to protect each other. Death and incapacity aren’t limited to married couples, after all.

Reference: The Parkersburg News and Sentinel (Jan. 8, 2025) “Legal-Ease: ‘How things might have been’”

Preparing for Life With an Estate Plan

A properly prepared estate plan includes a number of legal documents giving your specific and personal instructions to healthcare providers, financial institutions and the courts in charge of validating your will and overseeing asset distribution after you die.

According to a recent article from Kiplinger, “5 Key Components of an Estate Plan—and 7 Others to Consider,” if you don’t have an estate plan, your state’s government and local courts will make many decisions for you. Worse, your loved ones will need to petition courts to do anything for you, from making healthcare and end-of-life decisions to appointing someone to raise your children or sell your home.

An estate plan is prepared by an estate planning attorney who will know the various legal documents and strategies necessary to protect you and your loved ones. An estate plan includes the following documents:

Living Will. This document expresses your wishes for medical care, with as much detail as you want. For instance, do you want to have artificial nutrition through feeding tubes or blood transfusions if you are unable to give your consent? How do you want doctors to manage end-of-life care, if your body is living but your brain functions have ceased?

Without a living will, doctors will usually take an aggressive stance to keep you alive, even if you have something else in mind. Alternatively, your loved ones might have to make these decisions without knowing what you would have wanted. Having a living will and making sure your loved ones know what you want is a gift to them. Think of the guilt they’ll live with if they don’t know your wishes.

Healthcare Power of Attorney. This POA names someone you trust to make medical decisions when you can’t convey your wishes because of incapacity. They become your healthcare proxy, speaking with your doctors and deciding on treatment for you. Without one, your loved ones won’t be able to be involved in your care without going to court and petitioning to be named healthcare proxy.

You may remember the case of Terry Schiavo, a 26-year-old woman who had a heart attack and was only kept alive through artificial means. Her husband and parents were engaged in a court battle from 1990 to 2005 when a court ruled doctors could remove a feeding tube. Most of these situations don’t make headlines but are no less painful for families.

Financial Power of Attorney. This POA names someone to manage your money, access financial accounts, manage assets and run the day-to-day finances of your life when you are incapacitated. If you don’t have a POA, the court will name someone for you, whether you would have chosen them or not.

There are different kinds of POAs. The Durable POA is in effect the moment it is executed. The Springing POA is only executed when you become incapacitated and may lead to delays. Your estate planning attorney will know which is best for your situation.

Last Will and Testament. A will outlines your instructions for distribution of assets. If you have minor children or other dependents, it names a guardian for them. It also names an executor, the person who will be in charge of managing your estate. Without a will, again, the courts will decide who should receive your assets and raise your children.

An estate plan addresses the use of trusts to distribute your assets without court involvement. If your family includes a disabled individual, your estate plan includes plans for their future. For singles and childless couples, an estate plan spells out who will be able to make financial and healthcare decisions when you cannot.

Consult with an estate planning attorney today to give yourself and your family the peace of mind you all deserve.

Reference: Kiplinger (Jan. 6, 2025) “5 Key Components of an Estate Plan—and 7 Others to Consider”

Do I Need a Living Will?

Most people have strong feelings about what kind of medical care they want if they are incapacitated but don’t know if they can put those wishes into a legally enforceable document. A living will expresses whether or not you want all means taken to save your life, to refuse medical treatment, or any steps in the middle, according to a recent article from The Wall Street Journal, “A Living Will Covers Your Most Important Asset: You.”

A last will and testament distributes assets, like real estate and investments, and directs what you want to happen after you die. A living will is a separate document addressing healthcare decision-making if you are unable to express your wishes because of being in a coma, having an accident, or being at the end stage of a terminal illness.

There’s a lot of confusion about end-of-life issues in hospitals and emergency rooms. A living will can remove almost all ambiguities.

Everyone should have both a living will and a regular will. However, only about a third of people do. Older people tend to have more living wills than younger people. However, the number of those who have both documents is far too low.

A living will can be very specific. You might want to receive artificial hydration and nutrition but not artificial respiration. You can even add whether or not you want music to be played by your bedside, or whether or not you want to have a visit by a chaplain in the hospital.

Some states have different names for these documents. However, in most states, there is one form called an advanced directive, which includes a living will. You also want to have a healthcare proxy, a document naming a person you want to make medical decisions for you. Your healthcare proxy is also the person who follows the living will directions.

People who are incapacitated and don’t have a living will create confusion and stress for loved ones. Let’s say you have three adult children, and none of them know what kind of care you want. What will they do if the doctor asks them?

Another problem is if you have a living will, but no one knows where it is except you. The living will should be with other estate planning documents. Important people in your life should know where they are located and be able to access them.

If you have a living will, your healthcare proxy should have a copy of it. Ask your doctor if they can include a copy in your patient chart or on the portal they use to communicate and share medical records.

Finally, you’ll want to keep your living will up to date. As you age or illnesses change your health, you may have different feelings about your wishes. The most recent living will with the most recent date will be the one used by medical providers.

The living will is part of your comprehensive estate plan. Like the rest of your estate plan, it is a gift to others so they know what your wishes are.

Reference: The Wall Street Journal (Dec. 2, 2024) “A Living Will Covers Your Most Important Asset: You”

How to Help Heirs Prepare for an Inheritance

If your family doesn’t talk about estate planning, including incapacity, death, or money, your heirs aren’t likely to know what to do if and when you become incapacitated, when you die or how to manage your assets when they become their inheritance. This is all too often the case, but it doesn’t have to be; according to a recent article from Madison Daily Leader, “Are your heirs ready to receive an inheritance?”

When an inheritance arrives, it’s accompanied by emotional, financial and legal issues. Having everyone prepared and informed can make the difference between a squandered inheritance, an inheritance consumed by taxes, or an inheritance wisely managed and benefiting one or more generations.

There are key issues to discuss, including matters to cover with an estate planning attorney.

Communicate with your family about your estate plan, which is more than a will. Incapacity planning includes a Power of Attorney and Healthcare Power of Attorney, two documents allowing you to name someone else to act on your behalf if you cannot express your wishes. A living will tells loved ones your wishes regarding end-of-life care. With it, your family will know if you want to be kept alive by artificial means. Without it, they’ll have to guess.

Sharing the contents of your will allows loved ones to know what to expect. They may not all be happy with your decisions. However, it won’t be a surprise and will be less likely to spark disputes after you have passed.

Do your heirs know how to manage money or other assets? If you’re leaving your heirs wealth in the form of stocks, real estate, IRAs, 401(k)s, cash, or cryptocurrency, they’ll need to be prepared to accept the assets. If your estate includes a vacation home, is there a plan for sharing it among heirs? These issues will be more manageable, if heirs understand what they are inheriting and what they’ll need to do.

An estate plan should address taxes for the people creating the plan and their heirs. While your family may not have to worry about federal estate taxes, some states still have inheritance and estate taxes. Withdrawals from certain types of inherited accounts may incur state and federal income taxes, which could take a bite out of their inheritance. If inherited assets are sold for more than they were worth at the time of inheritance, there may be capital gains taxes.

Every estate has some expenses to be considered, including funeral costs. If the decedent has a mortgage and the home is left to heirs, they may need to sell it quickly before expenses mount. The estate plan should include an inventory of all liabilities and assets, so the executor can address any outstanding debts.

There’s a lot to unpack when managing an estate. Start by having an estate plan created with an experienced estate planning attorney or update an existing plan to be sure that it still achieves your wishes. Talk with heirs so they understand your intentions. Leaving a legacy of caring takes many forms, and this is one of them.

Reference: Madison Daily Leader (Nov. 23, 2024) “Are your heirs ready to receive an inheritance?”

What Is Needed for End-of-Life Planning?

Becoming incapacitated or dying without planning isn’t uncommon. Nevertheless, it is harmful to loved ones who are left to address the legal and financial aspects at the same time they are experiencing the grief of loss. What needs to happen is addressed in an article from Twin Cities Pioneer Press, “Your Money: A balanced approach to end-of-life planning.”

End-of-life care is expensive. Costs rise as the person moves through the different stages of illness or age. Medicare doesn’t cover long-term nursing care in a facility or at home, so resources without planned protection will rapidly be exhausted. An estate planning attorney can help the family prepare for these costs, but only when planning takes place in advance.

Once incapacitated, people cannot legally sign and execute legal documents. If the family hasn’t arranged for a Power of Attorney or Medical Proxy to be created while the person is still legally able, the family may be faced with the additional expense of going to court to petition for guardianship and/or conservatorship.

There are five basic estate planning documents to be prepared. While every adult should have these documents, they become more critical when someone is closer to passing.

Last will and testament. A will directs how you want your assets to be distributed upon your passing. It may include personal property, real estate, jewelry, family heirlooms and any other material goods. Note the will becomes a public document when the estate goes through probate, so don’t include any account numbers or information you don’t want to read by others.

Healthcare directives. Privacy laws are strict, and healthcare providers are limited in what they can discuss with spouses and children if the right documents are not in place. A Medical Power of Attorney or Healthcare Proxy is needed for family members to be involved in medical decisions. A HIPAA Release Form should be created to access health care and health insurance records.

Many accounts, including bank and investment accounts, IRAs, SEPs and life insurance policies, have beneficiary designations, where a person or persons are named to receive the asset upon the original owner's death. Make sure these are up to date to reflect the owner’s wishes.

Trusts take assets out of an estate for tax and wealth transfer purposes. The person creating the trust dictates how and when the beneficiaries should receive assets. Distributions can occur over an extended period or when certain conditions are met.

Meet with an experienced estate planning attorney if you or a loved one is ill and may be approaching the end of life. Putting an estate plan in place ensures that wishes are fulfilled and spares the family from having to guess what a loved one would have wanted in their final days.

Reference: Twin Cities Pioneer Press (Oct. 12, 2024) “Your Money: A balanced approach to end-of-life planning”

Your College Student Needs a Power of Attorney for Finance and Healthcare

Once a child reaches the age of legal majority, they are considered an adult with privacy rights.  This means that parents lose access to private information. This can have dire consequences if the student is involved in an accident or gets seriously ill, explains the article “Navigating The Transition To Adulthood: A Legal Guide For Parents” from mondaq. With proactive steps, parents can address these situations before they occur.

Whether or not your insurance covers your child’s healthcare doesn’t matter. Without a Healthcare POA, parents cannot make medical decisions, speak with healthcare providers, or talk with the health insurance company. Parents are strongly urged to have their college-bound student complete a Healthcare Power of Attorney.

If there is no POA and the child is incapacitated, parents will have to go to court to be able to make medical decisions for their child. Hospitals and healthcare providers are extremely strict about following these rules to avoid litigation and fines. No matter how bad the situation is, don’t expect any rules to be bent.

Your adult child should also have a Living Will. This is a document controlling decisions about end-of-life. It only becomes effective when a person is in a state of permanent unconsciousness, like a coma, or if they are terminally ill. The student uses this document to express their wishes concerning care: do they want to be artificially fed, hydrated, or kept alive by extraordinary means? Do they want to become an organ donor? This document conveys their wishes and can save the family an unimaginable amount of added stress during a trying time.

A Durable Power of Attorney is used to name a person, known as an “agent” or “attorney in fact,” to act on their behalf. The agent can take care of legal and financial matters. This is needed in case of incapacity so the parent or trusted person may deal with financial institutions, colleges, courts and any other company or organization on behalf of the student. Without it, parents cannot access account information or act on the student’s behalf.

Does your student need a will? The estate planning attorney who helps create the documents listed above can help you answer this question. Depending on their situation, if the student owns a car, has a bank account, an inheritance, or sizable cryptocurrency accounts, they may need a will.

The documents mentioned above should also be in place for parents. If parents don’t have a will, Power of Attorney, Healthcare Power of Attorney, Living Will and trusts, if appropriate, their newly minted adult will have a lot to deal with if they should both die unexpectedly. A visit to the estate planning attorney for all generations is a good idea.

Reference: mondaq (June 24, 2024) “Navigating The Transition To Adulthood: A Legal Guide For Parents”

How Parents and Adult Children Talk about Money and Aging

If you thought it was hard to talk with your children about sex, try talking with them about money and death. Americans generally steer clear of talking about death and money. Nevertheless, these conversations are necessary, according to a recent article, “Let’s talk about money and death: Why aging parents and their adult children should have ‘the talk,’” from MarketWatch. Sharing information about finances and end-of-life wishes can prevent resentment or stress before a crisis and gives everyone involved peace of mind.

If an estate plan has been created and financial and tax planning accomplished, but the adult children aren’t told a plan exists, there may be general worry over decades as parents age. What will happen when they die? Will the siblings know what to do? Who will be in charge? A family meeting to discuss the plan and the parents’ wishes can address these issues.

This is especially important for members of Generation X (Americans born between 1965 and 1980). This cohort has the most assets, may deal with a significant wealth transfer and often cares for its children and aging parents.

Start by putting together an agenda for the family meeting. Understand that there may need to be more than one meeting, since there is so much ground to cover. Long-term Care planning, the current status of the parent’s living situation and plans for a possible move to a continuing care facility are just the start. Do the parents have an estate plan and documents like a Power of Attorney, Healthcare Proxy, Advanced Care Directive and the like?

Money can be an emotional conversation, especially if there are disparities in the sibling’s financial status. Parents are often extremely reticent to share information about their net worth, sometimes because they don’t want their children to lose incentive to work, and in other situations because they are embarrassed about not having enough money to sustain them through their later elder years.

Having a neutral third party in the meeting, like an estate planning attorney, can be helpful when emotions are running high. Holding a family meeting in a law office may sound formal. However, having a professional on hand who can clarify estate, financial and tax matters may help keep the conversation focused. If the estate planning attorney works with a therapist or geriatric specialist who facilitates family discussions, they may be able to help the family move past the emotions of anticipated grief into productive, concrete planning.

Confronting the realities of mortality and money is difficult even in the best of circumstances. Nevertheless, with the support of skilled professionals, a focus on care and the creation of a no-judgment zone, the family will be able to help each other as they prepare for the future.

Reference: MarketWatch (March 23, 2024) “Let’s talk about money and death: Why aging parents and their adult children should have ‘the talk’”