Discussion on estate planning for aging parents, including three fundamental documents every parent must have, why proper titling of assets is so important, benefits of having a trust and more.

1. What (and How) To
Ask Your Parents
About Their Estate
Planning
June 19, 2014
Ronald F. Wayne, Esquire
1375 East Ninth Street, Suite 1700
Cleveland, Ohio 44114
P: 216-615-7349
rwayne@bdblaw.com
www.bdblaw.com

2. Estate Planning Pyramid
Focus on the Fundamentals
Other Documents
And Charitable
Planning
Health Care
Documents
Powers of
Attorney
Wills
Proper Titling of
Assets
Trusts

3. Do You Have…
These Three Critical Documents?
 Financial Durable Power of Attorney
 Health Care Documents
 Last Will and Testament

4. Do You Have a…
Financial Power of Attorney?
 Prevents Probate Court Guardianship
Problems
 Little or no Flexibility for Estate Planning
• All activity and filings generally public record
Assets must be appraised and inventoried
Nosy neighbors, business competitors
No expenditures without Court approval
 Court generally will not allow Medicaid Planning
 Expensive, administratively difficult, slow

5. Do You Have a…
Valid Power of Attorney?
 Current or Springing
 Limited or General
 Compliant with 2012 Ohio Law
 Specific Reference to “Hot Powers”
 Signed, Dated and Notarized.
 Should also be witnessed for
recording purposes if necessary in
other states.

6. Do You Have…
Health Care Documents
 Health Care Power of Attorney
 Springing Document
 Appoint someone to make decisions on your
behalf
 Living Will
 Declare your intention not to be artificially
sustained if no recovery is possible
 Donor Registry
 Make known your binding wishes regarding
organ and tissue donations

7. Do You Have a Valid…
Last Will and Testament?
 Must have this document as a safety
net but we want to using it by avoiding
probate
 Deals only with Probate Assets.
 Those assets without “embedded
instructions”
 Does not control disposition of non-
probate assets such as:

8. Probate Avoidance Devices
 Joint and Survivorship
 Transfer on Death
 Payable on Death
 Beneficiary Designations

9. Necessity of Last Will
 A “clean up hitter”
 Designate guardian for minor or
disabled children
 Appoint an executor
 Insert a Will Contest Clause
 Pour over remaining assets to a
revocable Trust or outright distribution
to estate beneficiaries

10. Have You Reviewed…
How Your Assets Are Titled?
 Takes precedence over dispositive
provisions of Wills and Trusts
 Simple
 Extremely important
 Must be reviewed periodically
especially after death or divorce
 Special Issues with ERISA Plans

11. Do You Need a Trust?
Certainly if:
 Estate is large enough to have
Federal or State estate tax
consequence
 Beneficiaries with disabilities,
addictions, bad marriages, debt,
spending issues, creditors, physical or
mental issues

12. Probably if:
 Second Marriage
 Blended Family
Probably not if:
 Estates are very small and
none of above concerns are
present
Do You Need a Trust?

13. Caution: Second Marriages
With Blended Family
 Dangers of outright bequest to surviving
spouse or joint and survivorship, transfer
on death or designation of surviving
spouse as sole beneficiary
 Famous Last Words: “I promise to divide
it equally between all of the kids”
 Multiple spousal election rights
regardless of what Will says
 ERISA rights

14. Long Term Care Concerns
 Long Term Care Insurance
 Affordability?
 Necessity?
 Self Insurance

15. Long Term Care Concerns
 Medicaid Planning = Self Impoverishment
 Five year look back period
 Gifting
• Outright
• In Trust
 Post Institutionalization Possibilities
 Remedying situation where there is no
planning
 Requires quality and specific Durable
General Power of Attorney

16. Medicaid Criteria
 Single individual
 $1,500; prepaid burial contract, one
modest automobile, HHG&F, limited
insurance cash value
 Married Persons
• Personal residence of community spouse
• One half of assets but not to exceed
$117,000

17. How to ask:
 “I’m doing my own estate planning and wonder if
yours is done?”
 “My friend’s parent had an incident and I don’t
want that to happen to our family”
 I went to a presentation and…
 “I’d feel better knowing, in generalities, where
assets are and who is your attorney, accountant,
financial planner, long term care and life
insurance agent
 Where do you keep your documents and
passwords?
 What responsibilities might I have under your
documents?

18. Conclusion
 Better to ask than not ask
 Live with the response
 Assist with finding competent counsel
 Stay outside of the process once
commenced, unless invited back in
 Urge review upon change in
circumstance, life changing event,
deaths of beneficiaries or fiduciaries
and tax law changes

19. Thank You