A Family History is Often the Most Valuable Part of Your Legacy

Jan 27, 2014  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning, Legacy Planning

In survey after survey, people report that the most important thing they can receive from their parents or grandparents as an inheritance is a legacy of family stories and personal histories. While many people think that inheritance and legacy planning focus solely on questions of property, those who stand to inherit often believe much differently. In a 2012 survey conducted by the Allianz Life Insurance Company of North America, respondents overwhelmingly reported that they valued keeping their family history’s life more than anything else.

Boomers and Elders Agree on Legacy Issues

The survey asked baby boomers and Americans age 72 and older a range of questions about inheritances and family legacies. The vast majority of baby boomers who responded, 86%, said that the most important part of their personal legacy was to be able to leave behind family histories and stories that were kept alive by other family members. 74% of elderly Americans said the same.

These results were very similar to those found by a previous survey conducted by the same company. In 2005, Allianz Life surveyed baby boomers and elderly Americans about family heirlooms, personal mementos, and other inheritances. Only 9% of the baby boomers who responded said they were eager to receiving a monetary inheritance, while 14% of elderly Americans said that such inheritances were important parts of their legacy.

The vast majority of people, it seems, places much less importance on inheriting money than on preserving family stories.

Preserving Your Stories and Your Family Legacy

The question of how to preserve family history is an important one to ask yourself. Many families tell stories about their history to one another, but those stories can be easily lost as family members die. Preserving important mementos can be relatively easy by creating specific estate planning tools, but preserving memories and stories is much harder to do.

Having a tangible reminder of the family histories and personal details is essential if you want to keep the stories alive. You can, for example, begin preserving your legacy by reviewing old photo albums. You can write down details about each photo either on the back of each photo, or keep notes on a separate piece of paper or document. With the details in hand you can then begin assembling stories. You can either write the stories done yourself, or if you are more ambitious, hire someone to write them for you.

You can also assemble your photos into a tangible product, such as a scrapbook or personal family history. Digital and desktop publishing also gives you the option of creating digital versions that you can much more easily share with other family members.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Differences in Advance Directive Laws Highlighted by Recent Texas Case

Jan 27, 2014  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning, Incapacity Planning, parents with young children

A Texas case involving a pregnant woman is drawing renewed attention to state laws about advance directives, incapacitated people, pregnancy, and the ability to make medical choices.

In late 2013, Dallas-Fort Worth area paramedic Eric Munoz found his pregnant wife unresponsive on the floor of their home. After transporting her to the hospital, Munoz discovered that his wife, Marlise, had likely suffered a pulmonary embolism that had left her incapacitated. The embolism had deprived her brain of oxygen, and left her effectively brain-dead. The doctor said they didn’t know if any damage had been done to fetus she was carrying.

Mr. and Mrs. Munoz were both experienced paramedics. They had previously discussed the question of whether they would want to receive life-sustaining treatment if they were in an unrecoverable medical condition. Eric Munoz said that his wife, even though she had not completed an advanced medical directive, would not have wanted to be kept alive artificially. He told her doctors this, but they were unable to comply with his directions because Texas state law prevents it.

Medical Directives and Pregnancy

Several states, including Texas and Washington, allow people to create advance medical directives, but do not allow the choices they make in those directives to apply during pregnancy. In the Munoz case, since Marlise is pregnant, her doctors cannot withdraw any life-sustaining treatment. Though Texas law allows people to create advance medical directives, the law specifically states that pregnant women cannot refuse to receive such treatments.

Washington Directives and Pregnancy

Like Texas, the state of Washington also imposes restrictions on advance directives made by pregnant women. The law effectively states that a woman who has created a living will or other advance medical directive cannot use that directive when she is pregnant. So, should a pregnant woman become incapacitated and have a directive that states she does not wish to receive life-sustaining treatment, her doctors are prevented from following those wishes.

Medical Choices

In the Munoz case, since Marlise did not have a directive, her husband became the person who would be able to make medical decisions on her behalf when she is incapacitated. If a similar case were to arise in the state of Washington, the same thing would likely occur. In other words, a husband of an incapacitated pregnant woman in the state of Washington could not direct her doctors to remove life-sustaining treatment even if he was sure that she would not have wanted to receive it.

The Munoz case shines a new spotlight on the important issue of medical directives. Because state laws are so different, everyone who wants to create an advance directive should always talk to an attorney in their area.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

What You Think You Know About Elder Law Could Hurt You

Jan 27, 2014  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Elder Law, Estate Planning

Elder law attorneys commonly hear a lot of myths about this area of the law. Whether you get your advice from someone who is well intended but uninformed, hear something from a friend, or see something on television, relying on bad information could harm you as you create an estate plan or consider elder law topics. If you ever have a question about an elder law issue or need assistance, you should talk to your attorney for specific advice. In the meantime, here are two of commonly held myths that many people believe about elder law and estate planning.

You can qualify for Medicaid by giving your property away.

When people consider the costs of long-term care, some of them turn to Medicaid as a way to cover the expenses. While Medicaid will pay for nursing home expenses or similar costs, not just anyone can use it. To qualify for Medicaid you have to meet some fairly strict income and asset eligibility criteria.

A lot of people are aware of the Medicaid eligibility restrictions, but they believe that they can meet these requirements by simply giving their property away. For example, people who believe they own more than the maximum Medicaid asset level believe that they can give away their property to their family and then apply for the program.

This isn’t entirely true. While you can reduce your assets by making gifts, Medicaid will look at the gifts you’ve given within the past five years. If the gifts you’ve made during that time put you over the eligibility limit, you won’t be able to qualify.

I have a will, so I don’t need to worry about elder law.

When people hear the term “elder law,” many of them associate it with estate planning. While it’s true that estate planning and elder law cover many of the same issues, they also address very different concenrs.

Your estate is the collection of assets and obligations you leave behind after you die. A last will and testament is a tool you can use to choose how you want to distribute this property to others. Unfortunately, a will isn’t the only thing you will need when you are creating an estate plan, and it does nothing to address some significant elder law issues.

For example, you cannot use your last will and testament in order to make medical choices. Wills only apply after you die.  If you want to communicate your medical wishes to your physicians in the event you become incapacitated, a last will and testament will do you no good. Creating a good estate or elder law plan requires you to address a wide range of issues, and develop the proper tools that address them.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Common Questions About Estate Tax Portability

Jan 27, 2014  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning, Taxes

Many people have questions about estate taxes, portability, and what it all means for them. While estate, gift, and generation-skipping transfer tax calculations can be a little intimidating, there are some basic concepts that can help you easily understand them. When it comes to portability, asking the right questions will give you a better understanding of what it means for you, your spouse, and your estate.

Question 1. What is the estate tax?

The estate tax is a federal tax that applies to property left behind by a deceased person. If you die leaving behind property, your estate may, through your estate representative, have to pay a portion of its value as a tax.

Question 2. Do all estates have to pay an estate tax?

No. Federal law allows every estate to exempt a specific amount of property from the estate tax. The exemption is the amount of money your estate gets to keep before it has to pay a single dollar in estate taxes. In 2014, the estate tax exemption limit is $5.34 million. This means that if you die in 2014 and have an estate worth under $5.34 million, your estate will not have to pay any estate taxes at all.

Question 3. What is the estate tax portability?

Estate tax portability applies to married couples who want to use the individual estate tax exemptions together. Essentially, portability allows spouses to combine their individual exemptions.

Here’s how it works. Let’s say you are married and your spouse dies leaving behind an estate worth $3 million. Several years later you die leaving behind an estate worth $6 million. Because your estate is worth more than the $5.35 million exemption limit, your estate would have to pay some estate taxes if you died as a single person.

However, because your spouse died before you did and did not use all of the exemption, there is still a little left over that you can add to your own. If your spouse died leaving behind an estate of $3 million, there would be $2.35 million in unused exemptions. Through portability you can apply a spouse’s unused exemptions to your own. In this situation, your exemption would total $7.7 million. Because your estate is worth $6 million, this means that your estate won’t have to pay a single penny in estate taxes.

However, applying the portability concept to any individual situation does require some careful attention to detail. For example, you’ll have to ensure that your estate administrator files the appropriate IRS form in order to gain the full benefit of portability. For more information about this, contact our office so we can discuss the concept in more depth.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Advanced Directives: Do You Need One? [Infographic]

Sep 10, 2013  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning

An advanced directive is a legal document that allows the person executing the document to make important, end of life decisions. It may also allow you to appoint someone to make healthcare decisions for you if you are unable to make them yourself at some point in your life. Understanding what an advanced directive can and cannot do, and why they are becoming so common, can help you decide if you should execute one yourself.

Advanced Directives: Do You Need One?


Click here to view a larger image.


Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Learning From General Norman Schwarzkopf

Jan 26, 2013  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning, Legacy Planning

As commander of coalition forces during operation Desert Shield and Desert Storm, General Norman Schwarzkopf left behind a legacy as a great military commander when he died this December. He also left behind a legacy that can teach us a lot about estate planning, even if we did not serve in the Armed Forces or were not as noteworthy or famous as the late general.

Legacy Planning

Part of estate planning is not simply making choices about who we leave our money to and how we can best structure our estate to minimize tax exposure, but it’s focused on the broader picture of protecting our legacy and leaving behind a memory of which we would be proud.

When Mr. Schwarzkopf left the Army, he could have taken any number of paths that would have affected his legacy. He could have remained in the public eye, entered into politics, or taken positions that could have impacted his legacy positively or negatively. Instead, General Schwarzkopf chose a mostly private life that was lived outside of the public eye. By maintaining this position and not becoming involved in disputes or political fights, the general’s legacy remained largely intact when he retired soon after leaving the successful Gulf War.

Veterans Benefits

As one of the highest ranking military officers of his time, the general not only had notoriety, but also had access to all the veterans benefits that’s everyone who has served in the Armed Forces can access. Veterans have access to benefits such as aid and assistance, survivor benefits, commissary access, and a range of other programs that can help you now, and help your family after you die.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Getting Started on Single-Retiree Estate Planning

Jan 25, 2013  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning, Retirement Planning

Whether you are recently divorced, never married, or widowed, a single retiree has a greater need to begin estate planning than married people do. As a single person facing retirement and the challenges that come with growing older, you’ll need to create a plan that allows you to maintain as high a quality of life as possible while still allowing for the possibility of receiving outside assistance.

A single retiree’s estate plan will include same basic documents that other estate plans include, such as a will, powers of attorney, and medical directives. However, you’ll also have to take into consideration your ability to obtain assistance and elder care services should you ever require them.

For example, single retirees can often benefit from developing a Medicaid plan that they can use if they ever need to enter a nursing home. Medicaid planning requires you to act years in advance in order to use Medicaid to pay for nursing home expenses. You don’t need to sell all your possessions in order to receive Medicaid, but Medicaid planning does require careful preparation.

Additionally, if you plan on living at home you will need to take precautions, especially if you live alone. If you don’t live with anyone and do not have close friends or relatives nearby who can assist you when you need them, you’ll have to prepare for the possibility of outside assistance. This might include, for example, hiring in-home caregivers, contractors to make your home more senior friendly, or temporary assistants who can visit you when needed.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

The Importance of Carrying an In Case of Emergency Card

Jan 25, 2013  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Elder Law, Estate Planning

We never know when we might be involved in a serious car accident, succumb to a medical emergency, or become a victim of a violent crime. If you are overcome by one of these situations, wouldn’t it be a comfort to know that emergency responders and health care providers had the information they required in order to save your life? And if they were unable to save your life, wouldn’t you want your loved ones to have the news of your passing be delivered as gently as possible? That is the purpose of an In Case of Emergency (ICE) card.

An ICE card usually contains the following information:

- Your name and contact information;

- Listing of any medical conditions with which you have been diagnosed;

- Listing of your known allergies;

- Name and contact information of the person(s) you wish to be contacted in an emergency;

- Name and contact information of your primary care physician;

- Name of your insurance provider, as well as your policy number.

Creating an ICE card is relatively simple and easy to do. There are some for-purchase websites that provide ICE cards that go into great detail, but there are also many free templates to be found online as well. One such website belongs to AAA, and it contains a free template that is easy to print and understand.

If you have not yet taken the time to create an ICE card, you should do so as soon as possible.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Incorporating Insurance Into Your Estate Plans

Jan 23, 2013  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning, Insurance

Thinking about what to include in your will, how you can use various types of trusts, and what medical directives you want to include in your estate plan are all very important, but you shouldn’t forget about the role insurance plays as well. Many people will use insurance as a key part of their estate and inheritance plans. Not only will medical insurance be an important part, but you must also consider the role life insurance and long-term care insurance will have.

Life Insurance

There are two main types of life insurance policies: whole and term. Term life insurance is the type of life insurance that most people think of when they think of life insurance. For this kind of policy you pay a yearly premium and can name a beneficiary who would receive a payout should you die during that year. Whole life insurance also provides for beneficiary payments, but it adds an investment element as well. Whole life insurance is more expensive, but it allows you to develop an investment portfolio and borrow against the portfolio’s worth.

Long-Term Care Insurance

If you believe you might need to one day reside in a nursing home or extended care facility, long-term care insurance is a good option. If you do not want to develop a Medicaid plan or do not believe you will be able to qualify for Medicaid, long-term care insurance can help alleviate the expenses associated with nursing home care. Like other forms of insurance, it  is always best to evaluate each long-term care insurance plan in light of your needs and financial abilities.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.

Administration Pressures States to Expand Medicaid

Jan 23, 2013  /  By: Geoffrey H. Garrett, Estate Planning Attorney  /  Category: Estate Planning

In a letter sent to state governors across the country, Health and Human Services Secretary Kathleen Sibelius said that the federal government would not provide states with funds to cover their expansion of the Medicaid program unless they adopted the expansion completely. States that try to implement a more limited coverage expansion would not receive federal assistance to help cover the expenses.

Under the terms of the Affordable Care Act, also known as the health care expansion law or Obamacare, Medicaid would be made available to anyone who didn’t have a high enough income. When the Supreme Court ruled on the healthcare law it allowed states to choose to opt out of the expansion without risking being denied other federal dollars.

However, states that choose to expand Medicaid under the terms of the law will have the costs of the expansion paid for by the federal government, at least for the first several years. By 2020, states would be responsible for 10% of the costs associated with the expansion, while the federal government would remain responsible for the other 90%.

In her letter, Sibelius said that states choosing to only partially expand Medicaid would not receive the benefit of federal matching funds.  Similarly, states that attempt to expand Medicaid by adopting different phases would also less than full financial support.

States have been grappling with the decision on whether to expand Medicaid. Because the federal law establishes the 2014 guideline, many will not make their final decision until sometime in 2013.

Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.