FLORIDA ESTATE PLANNING AND PROBATE LAW BLOG

The Florida Estate Planning and Probate Law Blog is focused on recent federal and state case law and planning ideas.

DISCRIMINATION PROVISION IN WILL UPHELD AS VALID

♠ Posted by Marc J. Soss in ,,,,,,,,
In the New Jersey Appeals Court case of In re the Estate of Kenneth E. Jameson, (NJ App., Aug. 12, 2016), a New Jersey appeals court upheld NJ law which allows discrimination provisions in testamentary bequests. The law does not preclude an "individual from disinheriting his or her child for religiously discriminatory reasons." The Ohio Supreme Court previously upheld a similar provision. The court upheld the specific provision contained in the Will, which disinherited his daughter if she married someone of the Jewish faith, because "neither the New Jersey Law Against Discrimination nor New Jersey public policy bars disinheriting a child based on religion or religious affiliation."
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NEW HOSPITAL NOTICE REQUIREMENT FOR MEDICARE BENEFITS

♠ Posted by Marc J. Soss in ,,,,,
On August 6, 2016, a new Medicare law went into effect that requires hospitals to notify patients, who receive observation services as an outpatient, that they may incur out-of-pocket costs if they stay more than twenty-four (24) hours in a hospital without being formally admitted. Most patients are unaware that any time spent in “observation status” will not count towards their three (3) day hospital requirement, even if it is spent in a hospital bed or they receive hospital services (tests, treatment and medications), and Medicare will not be obligated for their hospital bills and will not pay for subsequent nursing home care. Medicare benefits will only apply when the patient has spent three (3) consecutive days in the hospital as an inpatient. The new notification requirement is part of the Notice Act passed by Congress in 2015. The notice requirement is designed to prevent hospitals from keeping patients in an “observation status” and avoiding an inappropriate admission under the Medicare rules. Under the new law, hospitals can still keep patients in observation status, and those patients who fail to meet the Medicare requirements will continue to be responsible for their nursing home costs. Medicare covers up to one hundred (100) days of skilled nursing home care at a time.
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INDIVIDUALS OVER 65 SHOULD NOT PUT OFF MEDICAL CARE UNTIL 2017

♠ Posted by Marc J. Soss in ,,,,,
Most taxpayers are aware that they can claim a medical and/or dental expense on their Federal Income Tax Return if they meet certain eligibility requirements. Eligibility for the deduction requires (i) the taxpayer to itemize their income tax deductions (medical expenses, charitable deductions, certain taxes paid and home-related costs) and not claim a standard deduction (itemized expenses must exceed the standard deduction amount); and (ii) medical costs that exceed a percentage of the taxpayer’s adjusted gross income (“AGI”). In tax year 2016, the medical expense deduction is available to taxpayers under age 65 who have medical costs that exceed ten (10%) percent of their AGI. Taxpayers over age 65 are eligible to utilize the medical expense deduction if their medical costs exceed seven and one-half (7.5%) percent of their AGI. However, 2016 is the last tax year that the lower percentage will be available to taxpayers over the age of 65 years. Beginning on January 1, 2017, unless legislation is passed, the percentage will revert back to ten (10%) percent for all taxpayers.
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GUN TRUSTS – A THING OF THE PAST?

♠ Posted by Marc J. Soss in ,,,,,,
Effective July 13, 2016, Final Rule 41-F (the “Rule”) of the National Firearms Act (“NFA”) eliminated the loophole which allowed the making or transferring of a firearm, without a background check, through a Gun Trust. The Rule now requires all individuals, including those utilizing a Gun Trust, to adhere to the same identification and background check requirements and obtain local police chief approval to purchase an NFA firearm (short barrel shotgun or a silencer, etc.). The Rule specifically provides that the “responsible person” of a Gun Trust must now file new forms and submit photographs and fingerprints when the Gun Trust files an application to make or transfer an NFA firearm.
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STABLE ACCOUNTS - AS A PART OF YOUR ESTATE PLANNING

♠ Posted by Marc J. Soss in ,,,,,
The Achieving a Better Life Experience (ABLE) Act of 2014 will soon allow individuals to incorporate STABLE accounts in their estate plans for disabled family members. The accounts will allow family members to save money to be used by the disabled family member throughout their life without losing eligibility for government benefit programs. The account earnings will grow tax-free as long as they are utilized for qualified expenses. In order to establish a STABLE account, the individual must have been disabled before 26 years old and entitled to benefits under the SSI or SSDI programs.
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FLORIDA ESTATE PLANNING CONSIDERATIONS WITH LARGE INHERITANCES

♠ Posted by Marc J. Soss in ,,,,,,,,,
Receiving a large inheritance can be an unexpected windfall or curse to a beneficiary. To avoid a negative outcome, it is not uncommon for individuals to evaluate alternative methods to transfer wealth to their beneficiaries. A recent survey found that only thirty-two (32%) percent of baby boomers are confident their beneficiaries are prepared both emotionally and financially to receive an inheritance. Their concern stems from the desire for their beneficiaries to learn about hard work, failure and the joys of success and concern over their ability to handle sudden wealth. In making these decisions, individuals must also be concerned with: (i) the relationships of their beneficiaries (family harmony, divorces, current spouse’s and in-laws); (ii) student loan debt; (iii) establishing a 529 Education Plan for children or grandchildren; (iv) medical issues and a special needs trust; and (v) a drug or gambling problem or other destructive addictions. It is important to consider whether you want a beneficiary to receive their inheritance in one lump sum or distributions spread out over multiple years. All of these issues and more can be addressed in a well-designed estate plan.
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NEW 2016 CONNECTICUT POWER OF ATTORNEY LAW

♠ Posted by Marc J. Soss in ,,,,,,


 Effective October 1, 2016, the new Connecticut law governing “Powers of Attorney” (written designations of authority) will go into effect (a major update to the 1965 law. The new law, known as the Connecticut Uniform Power of Attorney Act imposes new obligations on banks to whom POA’s are presented by requiring them to either accept a notarized POA or request additional documentation within seven (7) business days. Once the documentation is presented, if the bank requests it from the agent, it will have five (5) days to either accept the POA or reject it (based upon suspected abuse or the bank’s knowledge that the POA has been revoked). In those cases, the bank continues to be free to refuse to accept the POA, without sanction or liability. Alternatively, if the bank refuses to accept the POA without sufficient cause, the attorney-in-fact can obtain a court order mandating acceptance of the POA and potentially recover reasonable attorney’s fees and costs from the bank.



The new law also provides that (i) the commencement of a divorce or separation proceeding will automatically revoke the POA designation of a spouse; (ii) the POA remains effective during incapacity without any additional language; (iii) existing POA’s remain valid; and (iv) the new law’s presumptions, such as revocation of a former spouse’s designation as attorney-in-fact and durability, will apply to prior POA’s. In addition, the new law creates a second, long statutory form that includes estate planning powers, allowing gift giving and other powers.
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FLORIDA GUARDIAN CHARGES BIG BUCKS TO PROTECT WARD WITH ALZHEIMER'S LIVING IN HUNGARY

♠ Posted by Marc J. Soss in ,,,,,


www.abcactionnews.com

A grieving daughter is fighting against a system that was designed to protect her dad

SARASOTA, Fla. - A grieving daughter is fighting against a system that was designed to protect her dad. She regrets the decision of turning to Florida's professional guardian system for help. She says that decision cost her father's estate a million dollars, and as the I-Team found out, the guardian was racking up those bills, when her father was living thousands of miles away.


“He was an immigrant, came here with one little suitcase and worked himself into millions of dollars,” said Mercedes Gyorgy, describing her father Akos Gyorgy. He earned millions as a Sarasota real estate broker, eventually owning 8 homes in three countries.. But his family says his estranged wife exploited him when he got alzheimer's disease.


They asked for the court to appoint a guardian to protect him and his assets, but now believe that was bad decision. “We turned to the courts to stop the financial abuse, and after that, over a million dollars has been spent on this guardianship,” Mercedes Gyorgy said. On Wednesday, she asked the court to release her late father's remaining assets to his estate, but the guardian and the guardian’s attorney are fighting against that.  “In the first two months of the case, one attorney billed $30,000,” Mercedes said.  And some of those bills came while her father was not even around.


He had disappeared while his Emergency Temporary Guardian was supposed to be protecting him. “I Called the police. They never called the police. They never called the police and said this man was missing,” Mercedes said. In a court document filed weeks later, it was revealed that Akos Gyorgy, who was incapacitated, managed to catch a cab from Sarasota to Orlando, then flew to Frankfort, before catching another flight to Budapest Hungary. Gyorgy was originally from Hungary, as was his estranged wife.


Mercedes says her father met her when his friend placed an ad in a Hungarian newspaper seeking a new bride for him, after his first wife died of cancer. He lived there for five years, which family members contend was out of the Sarasota court-appointed guardian’s jurisdiction.  While the guardian supposed to protect him from his estranged wife, she made multiple trips to Hungary to visit him. So did the guardian. On one visit, he billed his ward nearly $24,000 for a first class plane ticket, lodging at a 5-star hotel, and other expenses. “It was a vacation for sure,” Mercedes said. And that's not all. The court allowed the guardian to use the ward’s money to buy him a $200,000 home in Hungary just weeks before he died.


“It's a crazy case, but unfortunately, it's not that out of the norm with what's been going on in guardianship in the state of Florida,” said Marc Soss, who represents Gyorgy’s family. The judge says he's taking all of the testimony under advisement and will rule in the near future when the remainder of the ward's assets will be transferred back to the ward's family.
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HOW YOU CAN PREPARE FOR YOUR ESTATE PLANNING MEETING

♠ Posted by Marc J. Soss in ,,,,,,,



While meeting with an estate planning attorney may not be on your bucket list of items to accomplish during your lifetime or among your New Year’s resolutions, it is not something that you should put off until you are on your death bed. Many individuals are intimidated by the prospect of planning their estate, however, in most cases it is much easier if you come prepared.



A typical Florida estate plan consists of the following important documents: Last Will and Testament; Revocable Trust (for many individuals); Power of Attorney; Health Care Surrogate; Living Will; and Pre-Need Guardian Declaration. The Revocable Trust (if one is created), Power of Attorney, Health Care Surrogate, Living Will, and Pre-Need Guardian Declaration are all designed to operate during your lifetime and provide guidance in how your personal and financial affairs are handled during your lifetime.  In contrast, the Revocable Trust and Last Will and Testament control how your property is distributed after your death.



When you meet with your estate planning attorney, they will guide you through the various choices and planning options available to you, so that your legal documents reflect your intentions. In order to make your time with your attorney most productive, the following is a list of things that you should discuss and prepare in advance of the meeting:



Create a list of your assets and liabilities. This list should include the value of your home (including mortgage), bank accounts, investment accounts, business interests, personal belongings with value (e.g., artwork or jewelry), insurance policies on your life and retirement accounts. For each asset on the list, include an estimate of its value or current balance, as well as whether you own the asset in your individual name or in joint name with another person, such as your spouse or children. This information will assist your attorney in guiding you through the planning process.



Agents During your Lifetime



Health Care Surrogate: Who will make medical decisions for you if you become incapacitated. The individual you name to serve as your health care surrogate will be empowered to make health care decisions for you, if you are unable to do so. Thought should be given to whom should be appointed for this position, along with a successor to him or her.



Power-of-Attorney: Who will take care of your financial affairs if you become incapacitated. The individual you name to serve as your power of attorney will act as your agent with regard to your financial matters during your lifetime. The power of attorney will become effective immediately after you sign it. Thought should be given to whom should be appointed for this position, along with a successor to him or her.



Living Will: End of Life Decisions. The individual you name to serve as your surrogate will act as your agent with regard to your financial matters during your lifetime. The power of attorney will become effective immediately after you sign it. Thought should be given to whom should be appointed for this position, along with a successor to him or her.



Administration Upon Your Death



Who has the ability and skill to serve as your Personal Representative(s). The individual or professional entity that you select to serve as the Personal Representative of your probate estate will be charged with settling your estate following your death.  Their duties will include collecting your assets, paying debts, expenses and any taxes that may be due and then distributing the remaining estate assets to your beneficiaries. With married couples, each spouse typically names the other to serve as their personal representative.  The next consideration is who or what entity will serve as their successor, if they fail to survive you or are unable to serve. You may name more than one individual to serve in this role, but under Florida law they must either be a family member or resident of the state. Most importantly, it is important that the selected individual(s) or entity are trustworthy.



Who has the ability and skill to serve as your Trustee(s). The individual or professional entity that you select to serve as the trustee of your Trust, upon your death or inability to serve, will be responsible to manage your financial affairs, while you are alive, and settling your financial affairs following your death.  Similar to a Personal Representative, their duties will include collecting your assets, paying debts, expenses and any taxes that may be due and then distributing the remaining estate assets to your beneficiaries. With married couples, both spouse’s typically serve as the trustees, while they are capable. The next consideration is who or what entity will serve as their successor, if they fail to survive or are unable to serve. You may name more than one individual to serve in this role, without any restrictions of family membership or resident of the state. Most importantly, it is important that the selected individual(s) or entity are trustworthy.



Items of Personal Property and to whom they should pass upon your death.  Create a written document which states how you would like to dispose of your personal items (wedding ring, jewelry, automobile(s), baseball card collection, etc.) at your death, even if you do not believe they have any monetary value. Without a separate written statement, your personal items will pass to a surviving spouse or be divided equally among your children or beneficiaries. The itemized list can potentially avoid family disputes over items with sentimental but no monetary value.



Plan for Distribution of your Estate. How, to whom and in what amounts you want your remaining estate assets distributed is the next important decision you will need to consider. Your assets can be distributed to any individual (family member, friend, acquaintance, etc.) or charity you may select. The assets can be distributed outright or over an extended time period (they reach a certain age, until the beneficiary needs or wants funds, etc.). There is no wrong decision as you are free to distribute your assets as you choose.
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SAME -SEX COUPLES CONTEMPLATING MARRIAGE SHOULD NOT PUT IT OFF

♠ Posted by Marc J. Soss in ,,,,,


A recent New Jersey Tax Court ruling, unpublished opinion, emphasizes the importance for same-sex couples to not put-off marriage for estate planning purposes. New Jersey has both an estate tax and an inheritance tax, and taxpayers must pay the higher of the two taxes. The estate tax impacts estates of more than $675,000. Notwithstanding a 31-year relationship, registration as a same-sex domestic partner under New Jersey's Domestic Partnership Act (DPA), and a marriage scheduled to take place with 6 days of his death, the New Jersey Tax Court Judge ruled that the survivor did not qualify as a surviving partner for estate tax purposes under New Jersey law.  As a result of his failure to qualify as a surviving spouse he was not entitled to a $101,041 estate tax deduction under New Jersey tax law.



The Judge, in applying a “very strict reading of the statute,” reached this conclusion based upon the fact that the couple were eligible to enter into either a civil union or a marriage as of the date of the decedent's death and did neither. In 2007, New Jersey had enacted the Civil Union Act which allowed same-sex partners, who entered into a civil union, to be treated the same as opposite-sex spouses for purposes of calculating the New Jersey estate tax. Subsequently, in October 2013, the New Jersey Supreme Court, in Garden State Equality v. Dow, permitted same-sex couples to marry. The New Jersey's statute on domestic partnership is “unequivocal” in providing exemptions only for personal income and inheritance taxes and not the estate tax.  
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