November 20, 2017March 7, 2023

Mediation in Estate Disputes

When family members start fighting over the estate of a loved one, the battle can turn acrimonious.

There is almost no way for there to be a civil intra-family estate dispute, unless the case goes to trial before a judge.

When family members start testifying against each other it is extremely difficult for the wounds to heal. To avoid this problem, many courts prefer that families to try to solve their disputes through other methods before a case goes to trial.

A common way to do this is for the litigants to be sent to mediation which the Wills, Trusts & Estates Prof Blog discussed in “Court Rejects Effort to Avoid Settlement Agreement.”

In mediation a trained, neutral third party attempts to facilitate an agreement between the parties to the dispute. A mediator will often try to get the parties to see the other person’s side and to compromise.

Even when mediation does not instantly help the parties to reach an agreement, it often helps to clarify the issues. Many feuding family members do decide to reach post-mediation settlements.

Mediation does not always work. Some people feel that they are pressured into settling during mediation.

For that reason, it is important to have an attorney during estate litigation as courts are reluctant to allow people who have second thoughts out of any agreements reached during mediation.

Reference: Wills, Trusts & Estates Prof Blog (Oct. 25, 2017) “Court Rejects Effort to Avoid Settlement Agreement.”

November 10, 2017March 7, 2023

The Dangers of Guardianships

Rudy and Rennie North were a normal Nevada couple in their 50s. Rennie needed some assistance with day to day living, which she was able to get from a nurse at home.

Then, a woman named April Parks came into their lives.

Parks owned a business and was considered a professional guardian. Without consulting the Norths or anyone in their family, Parks was able to get a letter from a physician’s assistant declaring that the Norths needed a guardian.

Parks took this letter to court and was appointed their guardian.

The Norths again were never consulted.

No tests were conducted on them, to see if they were lacking in cognitive functioning and unable to care for themselves.

Eventually their life savings were used up and they now live in a converted office with their daughter.

The New Yorker reported this story in “How the Elderly Lose Their Rights.”

Although things like this should never happen, they occur all too frequently.

If the legal system is not diligent in protecting the elderly from so-called guardians who just want to take what the elderly have, there is little the elderly can do about it. In this case, the court system was complicit in Parks’ scam.

If you suspect that someone has used the guardianship system to take advantage of you or someone you love, it is vital that you speak to an elder law attorney immediately.

The attorney can help you to stop the guardian before it is too late.

Reference: The New Yorker (Oct. 9, 2017) “How the Elderly Lose Their Rights.”

November 8, 2017March 7, 2023

Section 2704 Rules to Be Withdrawn

When the Obama administration announced changes to the valuation discounts for family businesses for estate tax purposes, known as the Section 2704 rules, there was a lot of consternation.

Many estate and legacy plans would have to be completely reworked in order to comply with the complicated new rules. It was not absolutely clear how all of those plans could be reworked and how the rules would actually be enforced. This created headaches for many people.

The Trump administration has decided to change course, as Forbes reports in “Treasury To Withdraw Hated Estate Tax Valuation Rules.”

The Treasury Department announced that it will soon publish an official withdrawal of the rules, since they have decided the rules are unworkable. That means planners can continue to rely on previous valuation methods, which brings a lot more certainty about how to make legacy plans for now.

This does not mean the estate tax itself has been repealed. President Trump has indicated he wants to do so, but, in the meantime, it should help those people who are affected by the estate tax.

Of course, even without the Section 2704 rules, it is still a good idea to review any previously made plans to make sure they will still be effective as intended.

Reference: Forbes (Oct. 4, 2017) “Treasury To Withdraw Hated Estate Tax Valuation Rules.”

November 7, 2017March 7, 2023

Jerry Garcia’s Estate Difficulties

It probably never should have been assumed that Jerry Garcia’s estate administration would go smoothly, after he passed away in 1995. At first, it did seem that maybe there would not be any major problems.

However, Garcia passed away after being married three times, having four children and having one stepchild.

Even after his third wife threw the first two wives out of his funeral, it did not necessarily mean the estate administration itself would go wrong. No one challenged his will, for example.
The big mistake came when the third wife, Debra Koons, was chosen to administer the estate, as the Wills, Trusts & Estates Prof Blog discussed in “The Wrong Executor Can Make Family Drama Worse, As Jerry Garcia’s Heirs Discovered.”

The problem for Garcia’s estate is that his other heirs objected to many of the decisions that Koons made. They felt she was acting in her own interests and not in the best interests of everyone.

This led to constant family squabbles and made the estate administration more costly and time-consuming than it needed to be.
The problems should have been anticipated.

It would have been wiser to have an independent professional hired to handle the administration of the estate. That might not have been a solution to all of the problems, but it would have taken much of the family drama out of the situation.

Reference: Wills, Trusts & Estates Prof Blog (Oct. 12, 2017) “The Wrong Executor Can Make Family Drama Worse, As Jerry Garcia’s Heirs Discovered.”

November 3, 2017March 7, 2023

Little Things That Cause Estate Problems

When families fight over estates, it is not always over things of great importance. They often fight over the little things.

Much of the discussion about how to avoid family feuds over estates focuses on major items. The focus is on making sure that everyone gets his or her fair share of the estate’s wealth, so they will be satisfied and not challenge the estate.

That is an important discussion, but little items of personal property can also be a problem, as CNBC discusses in “7 Ways that cheap Tweety Bird figurine can screw up your estate.”

Potential problems include:

• Items that do not have great monetary value can still have great sentimental value to family members. If two people want the same item, it can be difficult to resolve that dispute.

• Do not tell anyone verbally they can have a piece of personal property without putting that in writing in your estate plan. If other people want the same item, the person you want to have it will have no way of proving that you said they could have it.

• Do not just let your family divide all your assets between themselves when you pass away. It is most likely that they will fight over who gets what.

• Even if you have given someone access to a safety deposit box and told them they can have the contents after you pass away, you still need to make that official in your estate plan.

• Make sure that any unusual items have been planned for, such as digital media accounts and frequent flyer rewards.

• Items regulated by the government can be complicated. You should plan accordingly.

• Your executor will need to have the authority to change the locks on your door. You would be surprised how often people simply walk in and help themselves to items that they want.

Reference: CNBC (Oct. 10, 2017) “7 Ways that cheap Tweety Bird figurine can screw up your estate.”

November 2, 2017March 7, 2023

Protect Your Greatest Asset

When people think about estate planning, they normally think about possessions and money. They think that estate planning is all about deciding who gets what possessions and who will inherit their money.

For some people, this is not something that they care about too much. They think it is of no importance to them what happens to their money. After all, they will not be around to spend it or to see who does, so why bother with it too much?

Estate planning, however, is about much more than that, as NJ Biz recently discussed in “Why haven’t you protected your greatest asset?”

The most important thing you have is your family, especially if you have minor children. Estate planning is about protecting them.

Yes, most of the focus is on possessions and money. However, the point of estate planning is to decide the best way to leave your possessions and money to your family.

It is about making sure that your family is cared for after you pass away.

When you plan your estate, you can make sure that your assets can be used by your family to meet its needs.

If you have minor children, then estate planning is also about making sure that a responsible person takes care of them and handles the assets for the children, until they are old enough to do so for themselves.

You need to plan for your family. Think about them as the reason for estate planning, instead of just thinking about it as a way to deal
with your possessions and money.

Reference: NJ Biz (Oct. 9, 2017) “Why haven’t you protected your greatest asset?”

November 1, 2017March 7, 2023

Wills Must Go through Probate

It is not always clear how mistaken estate planning beliefs get started. It usually happens on the Internet
with people seeking out legal advice from often bad sources.

Sometimes, it starts with a television show or movie that has played loose with the law.

Regardless of how mistaken beliefs start, it is important to make sure that you do not believe any of
them.

One that more people believe than might be expected, is that wills do not have to go through probate.

That is just wrong, as TC Palm discussed in “Common misconceptions about wills and trusts.”

This idea probably got its start, because in some states if an estate is small enough, then it does not have
to go through probate. Usually, these are very small estates with very few assets.

Someone with good intentions probably had a relative or friend who passed away with few assets and
as a consequence, the will did not have to go through probate.

However, most wills do have to go through probate. They need to be submitted to the court and
approved.

The probate court then oversees the administration of the estate as conducted by the executor or
personal representative.

If you want your estate to avoid probate, what you need is not a will.

Instead you need to use other estate planning instruments, such as trusts.

Trusts do not have to go through probate in almost all cases. If you would like to get one, schedule an
appointment with an estate planning attorney.

Reference: TC Palm (Oct. 5, 2017) “Common misconceptions about wills and trusts.”

October 31, 2017March 7, 2023

Grave Trippers

New York brothers Vincent and Robert Gardino have a very unusual hobby. They like to visit old cemeteries and seek out the final resting places of people who were once minor celebrities while they were alive, but who have been mostly forgotten about by history.

The brothers have developed a lively banter when they visit these graves and discuss the lives of the deceased between themselves.

Their banter is entertaining enough that it could soon be coming to your television, as The New York Times reports in “Like ‘Car Talk,’ but With Dead People.”

The brothers are developing a television show for PBS that will feature the two of them visiting the graves of people all over the country. The proposed name for the show is “Grave Trippers.”

While at first glance, this might not sound like an interesting show, the brothers are being compared to the brothers on NPR’s Car Talk.

If their banter is that lively and entertaining, this show could be a good watch for anyone interested in history and the lives of people in the past.

It should also have plenty of discussion about the historical graves themselves and presumably what happened to the people’s possessions when they passed away, if there is anything interesting about the estates.

Reference: New York Times (Sep. 21, 2017) “Like ‘Car Talk,’ but With Dead People.”

October 30, 2017March 7, 2023

Troubled Public Pensions

Public employees in the U.S. count on their pensions to provide for them in retirement.

While most private companies have moved to 401Ks, public employees still have the old pension system.

Because of these pensions, they are often not eligible for Social Security.

However, for decades, these pensions have been underfunded, since governments have preferred to spend money elsewhere.

The problem is severe and not isolated to just a few public pension programs, as the Economist reports in “American public pensions suffer from a gaping hole.”

The biggest source of the problem appears to be that administrators have preferred to use projection methods that are unrealistic. More realistic projections would require governments to make greater contributions.

There are no popular options to fix this problem.

Taxpayers do not want to pay more, so governments can meet their pension obligations.

Public employees do not want to contribute more of their paychecks to the pensions.

Current and future pension beneficiaries also do not want to see their benefits cut.

Something will have to give to address the public pension problem adequately.

If employees cannot rely on their pensions, then they might not be able to retire as planned, unless the
federal government intervenes and covers the pension shortfalls.

People who are no longer able to work, could find themselves forced to retire and also unable to meet
their expenses.

Reference: Economist (Oct. 5, 2017) “American public pensions suffer from a gaping hole.”

Building Legacies that Last Estate Planning and Elder Law

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