Archive for July, 2009

Multiple Health Care Surrogates

Wednesday, July 29th, 2009

I am working with a client from South Tampa who named two of her children to act jointly as her health care surrogates.  Now that my client is suffering  from some pretty significant medical problems, her children are now required to act for her.  Unfortunately, these children do not get along very well and do not have same opinions for their mother’s medical care.  As a result, they are fighting all of the time, and their mother’s care is not consistent.  The doctors and nurses are stuck in the middle of this, since they are getting different directions from two people who have the legal authority to act. 

You’d probably say that this problem is unique and would never happen to you.  And hopefully you would be right, but do you really want to risk it?  After all, we are talking about your medical care at a time when you could be your most vulnerable. 

So, here’s a very simple suggestion: consider naming only one child as your surrogate.  Or perhaps you might want to name someone other than a child as your surrogate.  That way, your children’s fighting won’t delay or hinder your medical care. 

If you do want a child to serve as your surrogate, consider also adding a statement to your medical directives that it is your hope and wish, but not direction, that your named surrogate talk to your other children about your care for their imput.  This will keep everyone “in the loop”, but only one child will have the legal authority to act for you.  Of course, you can’t stop your children from fighting about your care, but at least it will not be delayed and everyone will know what course of action is being taken for you.

No RMDs in 2009!

Saturday, July 25th, 2009

This year you do not have to take your required minimum distribution (the so-called “RMD”)  from your retirment plan.  The general rule is that in the year following the year in which you reach age 70 1/2, you must start taking annual distributions from your retirement account. 

Congress acted earlier this year to suspend this requirement for 2009 due to our economic troubles.  This same suspension applies for beneficiaries of an inherited retirement account, who would also be otherwise required to take an RMD.

This suspension is particularly helpful if you suffered significant losses over the past year in your retirement account.  Since you are not required to take anything from your account, you could consider leaving the account intact in an effort to allow the remaining funds to grow tax-deferred.  Of course, with likely increases in income tax rates looming, taking your RMD (or a greater amount for that matter) may be worth consideration.  Be sure to run the numbers with your accountant!

Air McNair dies without a Will

Wednesday, July 22nd, 2009

Espn.com is reporting that Steve McNair, the former NFL quarterback who was murdered last month, died without a Will.  The Court has appointed his widow as the personal representative of his estate.  This appointment gives her legal authority to collect her husband’s assets, pay his final expenses and any estate tax that may be owed on his estate and make distributions to his heirs.

We often hear from our younger clients that they do not really think that they need a Will.  After all, they are young, and they are just beginning to accumulate assets.  By most standards, Steve McNair was young, and I am sure that no one could have anticipated his death.  So, the idea that you are young so you do not need a Will does not always hold true.

Of course, Steve McNair probably had a sizable net worth, so the lack of planning for his estate is quite unfortunate.  His assets may not pass as he had intended.  Instead, he is forced to use the laws of Tennessee to determine how his assets will be distributed.

Regardless of how much you own, being able to determine to whom and where your assets pass is your legal right.  But only if you plan with a Last Will & Testament (and maybe a Revocable Trust if your circumstances warrant its use).