What is Permanent Guardianship & Why Does It Matter?

What is Permanent Guardianship & Why Does It Matter?

The importance of selecting a viable guardian early in a child’s life cannot be understated. In the event a parent passes prematurely or becomes unable to deliver the caregiving needs of a minor child, having a responsible and loving family member or trusted friend ready may prove invaluable. Without someone who has the force of law behind them, your child’s future remains uncertain.

A legal guardianship is not an informal agreement between family members and loved ones. While parents can discuss and agree that a sibling or grandparent would do the right thing in the event of a tragedy or setback, the courts hold sway unless you have a binding determined estate plan in place. That’s why it’s imperative to work with an experienced attorney to create legally-binding documents that ensure the health and welfare of your child’s future. That being said, these are elements of permanent guardianship parents would be wise to promptly consider.

Guardians & Parental Rights

People who do not work in the legal system are often surprised to discover that the family court does not necessarily handle guardianships. In most cases, family court judges decide child-rearing issues such as custody, visitation, and support, among others. Generally, probate handles guardianships because they are more closely related to Last Wills and other aspects of estate planning. So, in terms of guardianships coming into conflict with proceedings such as divorce or parental estrangement, cases are often referred to the probate system.

Although the discussion here remains focused on permanent guardianship, there are many instances when parents or the courts designate temporary status. For example, there are times when a child’s parent(s) are unable to provide care, support, or make consistent decisions due to temporary incapacitation. In such instances, they could transfer authority to their designee until they are able to resume parental responsibilities. In such instances, the parent does not necessarily surrender their primary rights.

Opting for a court-approved temporary guardianship should not be taken lightly by parents. When circumstances dictate that a disability, health condition, or addiction crisis renders a parent unsuitable to handle day-to-day caregiving functions, the court may find that it’s in the child’s best interest to terminate parental rights at some juncture. In such instances, guardianships are converted from temporary to permanent even against the parent’s wishes. That’s why it’s crucial to work with an experienced attorney when agreeing to temporary guardianship.

Making A Temporary Guardianship Permanent

Although temporary guardianships are intended to come to a logical end, sometimes circumstances require change. This may be the case when someone takes on the guardianship believing a parent will recovery from their challenge or condition within a reasonable time frame. Tragically, when parents lose their battle with health and wellness matters, permanence and stability tend to be in the child’s best interest. These are common reasons people petition the court for permanent guardianships.

  • The remaining parent passes away due to illness
  • The parent(s) has been incarcerated permanently or beyond the child reaching 18 years old
  • The parent can no longer adequately care for the minor child

When a guardian wishes to change the court-mandated designation to a permanent one, there are procedural steps that must be undertaken. It’s essential to work with an experienced attorney in such matters because the court bureaucracy can be difficult to negotiate, and missteps often prove costly.

Start by scheduling an appointment with an experienced attorney to gain insight about what permanent guardianship entails. Before making this extraordinary commitment, it’s important to understand all the rights and obligations that come with it in order to make an informed decision. If you still wish to proceed, these are legal hurdles that will need to be addressed.

Meet Court Requirements

The court’s responsibility in this process is to always protect the child’s best interests. The desires of well-meaning adults run a distant second. That’s largely why Washington State, and many others, set a stringent standard for permanent guardians. These are items required under Washington State’s Certified Professional Guardianship Program.

  • Must be at least 18 years old
  • Have no felony convictions on your record
  • Have no misdemeanor convictions that involve moral deficiencies
  • Be of sound mind and a person the court deems suitable
  • Demonstrate financial stability and a reasonably good credit rating

Although family members may not be petitioning the court under this specific program, its requirements highlight that you will need to make a persuasive case to a judge.

Gain Parent of Current Caregiver’s Consent

In instances where the parent can no longer raise the child or someone else has a temporary arrangement, a family member or interested third-party can petition to have the temporary order transferred to them and enhanced to a permanent one. One of the ways this pathway can be processed more seamlessly is with the current caregiver’s permission. By securing an affidavit to that effect, the court may be more inclined to grant the petition.

Provide Notice To Interest Parties

Once your attorney has completed your petition and filed with the court, all relevant parties must be notified in a timely fashion. This may include living parents, family members, and pertinent people in the child’s life that may also want to take on the guardian role. Make certain that your attorney has a list of all pertinent family members and potentially interested parties. Failing to complete this procedural step could upend the process or result in civil litigation brought by a family member or person with standing.

Your Day In Court

The fundamental question the judge considers when making someone a permanent or temporary guardian for that matter is whether the legal designation serves the child’s best interest. The judge will weigh a wide range of facts in reaching a conclusion. These may include the following.

  • Emotional bonds between the child and potential caregivers
  • Ability to provide necessities such as a safe, stable home, food, and medical care
  • Financial stability of the guardian candidate
  • Educational background and employment history
  • Issues involving previous alcohol or substance abuse
  • Mental and emotional fitness of the prospective guardian

You can anticipate answering pointed questions asked by the judge or any parties who oppose or have an interest in the petition. Securing permanent status can be something of an uphill battle when competing interests come into play.

What Parents Should Consider When Choosing A Permanent Guardian

In many cases, permanent guardianships are established by parents through estate planning documents. Parents who take such proactive measures understand that they are ensuring their child will be in good hands should they die prematurely or be otherwise unable to provide adequate care.

Ranked among the most significant challenges parents face is making an informed decision about whom to nominate. But by taking time to think through the process and weigh your options, you will be able to select the best possible candidate. These are things to consider.  

  • Consider Your Core Values: Although you may be immersed in a loving family, child-rearing remains deeply personal. Parents, siblings, and other loved ones may or may not share your core values. Take an inventory about issues such as religion, political perspectives, education, integrity, and other things that truly matter. Then, see who best mirrors your core values and would make a suitable guardian if necessary.
  • Multiple Guardian Option: While it may be somewhat uncommon, there are times when the designated guardian becomes unable or unwilling to fulfill the duty. That’s why it’s in the parents’ best interest to include an alternative in your estate planning documents.
  • Financial Stability: We live in a world in which financial security matters. A guardian who manages money well may be more likely to sustain a healthy and secure home life for your child. This person may also be asked to manage any assets to support the minor or work cooperatively with your estate’s trustee.
  • Speak To Your Family: Having an open and honest discussion about your desire to enlist a family member or loved one as a potential guardian must be treated with care and compassion. Take the time to explain your reasoning in a way that does not slight or otherwise make people feel less than adequate. You are basing the decision on what you perceive as an upbringing most closely aligned with your wishes. It may be worthwhile that while you respect others’ values and abilities, there are specific reasons for your choice.

Once you have reached an agreement with a guardian candidate, it’s vital to follow through with an attorney and make the designation legally binding.

Work With An Experienced Permanent Guardian Attorney

One of the most proactive measures to ensure that your child will grow up in a safe and healthy environment if something happens to you is designating a guardian in your estate planning documents. Giving the right person the ability to make essential life decisions allows you to provide care and comfort, even in your absence. If you have not yet designated a legal guardian or would like to update an existing plan, contact Lilac City Law today.  

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What to Know During the Guardianship Nomination Process

What to Know During the Guardianship Nomination Process

If something happened to you and you were unable to take care of yourself or your children, who would step in? Ideally, it would be someone you chose. Nominating a guardian before something happens allows you to do just that.

What Is a Guardian?

Think back to school forms asking for a parent or legal guardian. A guardian is a person who takes care of someone else when that person is incompetent to handle their affairs on their own. This could be due to a serious injury or illness. When minor children are involved, they may need a guardian if both of their parents are incapacitated or pass away.

A guardianship will generally cover similar decisions to what a parent could make for a child — even when the person needing a guardian is an adult. This may include medical decisions and, for minors, other life decisions such as where to go to school.

Guardianships can also cover managing the person’s finances, but finances are sometimes broken up into a separate conservatorship. Exactly what a guardian or conservator can do will be spelled out when the court approves the guardianship or conservatorship.

How Is a Guardian Different From Godparents?

When your children were born or shortly after, you may have appointed godparents. Godparents are often expected to step in and take charge of the children if something happens to a parent, but appointing a godparent is largely a religious or ceremonial action. Godparents aren’t directly recognized under the law.

To give a godparent the legal authority to act, and avoid conflicts with other family members who may wish to step in instead, you will need to go through the legal process of appointing the godparents as guardians, trustees, or other legal roles.

How Is a Guardian Different from a Power of Attorney?

A power of attorney might grant all of the powers that a guardian can exercise. The difference is mainly timing. You sign a power of attorney when you have full mental capacity. A guardian is only appointed after you’re incapacitated. Part of the guardianship appointment process can include reviewing the wishes you specified when you still had full mental capacity. However, a power of attorney cannot be executed if you have diminished mental capacity, and it may be voided if a court finds you lacked capacity when you signed it.

Because a power of attorney can be limited in scope based on how you had your lawyer word it, it may not cover all of the actions that need to be taken on your behalf. In those situations, a guardian would be appointed to fill in the gaps.

How Do You Select a Guardian for Yourself?

Like a person dying without a complete will, the law has default rules for how to select a guardian based on relationships and willingness to serve. The court will also consider the ability to do the job of each person who wants to be the guardian. This can lead to serious family conflicts and large legal bills when two family members wish to serve as the guardian and can’t come to an agreement.

To avoid these types of problems, you can nominate a guardian. The judge isn’t bound to follow your nomination but will give it great weight and will only overrule your nomination with a strong cause. The process is called nomination of guardian, and you can select any adult of sound mind. Like a will, the judge will review your selection to ensure you were mentally fit to make the decision and weren’t under duress or tricked into doing so.

How Do You Select a Guardian for Your Children?

The process for nominating a guardian for your children is similar to nominating a guardian for yourself. The only real difference is that it’s even more important to make your decision in advance so that your children can have a sense of stability and not be left hanging during long court battles.

You should, of course, also talk to potential guardians to see if they are willing to take on this responsibility. However, being nominated does not obligate the person to accept the judge’s appointment if the time ever comes. Therefore, you probably want to select at least one alternate.

Do You Need a Guardian If You Left a Trust for Your Children?

You may have set up a trust to provide for your children financially in case something happened to you. The trustee is then able to manage their financial affairs in accordance with the trust.

However, someone still needs to take custody of the children to manage their daily lives and important life decisions. This is where you need to nominate a guardian, and your estate planning documents should lay out the responsibilities of both the trustee and the guardian.

Who Supervises a Guardian?

Once appointed, a guardian must make regular reports to the court. This includes financial information as well as other major decisions. Other family members can also go to court to contest the guardianship if they believe the guardian is doing something improper.

What If There Is a Conflict Between a Guardianship and a Power of Attorney or Trust?

There should be no conflicts with a guardianship and power of attorney or trust because the court should appoint the guardian in consideration of other estate planning documents. The guardian should only carry out duties not already provided for. To avoid confusion, you should attach your other estate planning documents to your nomination of guardianship to ensure that the judge will be aware of their existence. If a power of attorney or trustee believes a guardian was appointed improperly or is going beyond their role, they can contest those actions in court.

Are There Downsides to Being a Guardian?

Whether a guardianship is for an adult or minor children, being appointed as a guardian is a major responsibility. Like a parent, it can mean making tough choices and sometimes needing to put the other person’s wellbeing before the guardian’s own. The nominated guardian will also need to go to court during the nomination process and will need to make ongoing reports to the court as long as they remain guardian. Being a guardian is a lifetime appointment unless the judge appoints someone else.

Does a Guardian Have to be Local?

A guardian can theoretically live anywhere in the world. However, the judge will want to make sure that the guardian will be able to effectively perform their responsibilities without being unduly impacted by long-distance. For minor children, since they will often go to live with the guardian, the judge may also consider how a move would impact their lives and their access to other family members. You can and should include your wishes on these issues in your planning documents so the judge can understand the choices you made and to avoid conflicts between family members.

If you’re relying on a long-distance guardian, you should also consider who will act in a sudden emergency such as you being rushed to a hospital. You may want to have an alternate power of attorney that gives a more nearby family member the power to act until your guardian is able to step in.

Who Pays for Legal Fees During Guardianship Proceedings?

Your appointed guardian should understand that they don’t have to take on legal costs. If you have liquid assets, the court will pay the attorneys reasonable fees from your funds — just like any other of your expenses would be handled. If you don’t have liquid assets, there is a special guardianship fund established by the government. In no cases does the appointed guardian pay for court fees, although you may wish to set aside money to cover other expenses they may face while acting as a guardian.

Please note that this is separate from creating your nomination of guardian documents. Those costs would be arranged between you and your attorney just like any other legal work.

How Quickly Can a Guardian Be Appointed?

Even for a nominated guardian who isn’t contested, the court process is usually measured in weeks if not months. During an emergency situation, your family could petition the court to appoint a temporary guardian pending full court review. This person could potentially be the guardian you nominated.

In more urgent circumstances, such as an emergency room doctor needing an immediate decision, any power of attorney or living will documents that you created and are readily available will be used. Otherwise, the hospital or other entity would attempt to contact your next of kin and follow their authority in accordance with local law.

Talk to an Experienced Estate Planning Attorney

To learn more about how nominating a guardian fits in with your estate planning strategy or to start the nomination process, talk to an experienced estate planning attorney at Lilac City Law today.

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Maximizing Tax Umbrellas for Estates

You have made it your life’s work to leave your family with substantial assets to provide for them after you are gone. Legacy is extremely difficult to build, but the estate tax law in the United States does not seem to take this into consideration.

Estate tax can rip as much as 40% of your family’s assets from them, depending on the value of your estate and its location in the country.

Right now is the time to protect your estate from federal and state taxes. If you take the time to create a well thought out plan, you can protect a great deal of the wealth than you have earned for your family.

Here are some powerful tips that you need to know.

Knowing Whether Your Estate Will Be Taxed

Estate taxes are not the same everywhere. Depending on the state you reside in, you do not have to be ultra-wealthy in order to be harshly taxed. Federal estate taxes have a minimum threshold that is in the million-dollar estate valuation, but states like Washington or Idaho can very easily tax middle-class families. If you are leaving behind any sort of investments, bank accounts, businesses, property or life insurance packages, the estate tax applies to you regardless of the size of that asset.

Also note, valuation is often subjective, and it is a discussion you should have with your estate planning attorney.  When it comes to estate taxes, you do not know whether the state will try to value your real estate or businesses higher than other sorts of appraisals – you should not leave it up to them to determine a fair valuation.

Geography is also something to take into account – if you live in a premium real estate location, just a couple of properties can push your entire estate value through the roof.  Sometimes this comes as a big surprise to the family after the passing of a loved one.  For example, the children of farmers often find themselves stuck with huge tax bills upon the death of a matriarch or patriarch because of the hidden value of the land on which the farm sits.

Providing Gifts and Charity the Smart Way

If you reduce the value of your estate through gifts to your children and grandchildren, that value cannot be counted against you for estate tax purposes. Every year, individuals save on the estate tax bill by giving away tens of thousands of dollars to their loved ones.

Moreover, making donations to charitable organizations is another great way to reduce your estate tax bill. These donations may also have an additional tax deduction attached to them. Donating to charity is a great way to ensure that the money you earn is used in the way that you prefer after you are gone.

Consult with your lawyer to learn how to maximize this benefit for your present taxes, as well as the ones that will impact your family after your passing.

Knowing When to Use Your Estate Tax Exemption

Everyone has a large (multimillion-dollar) tax exemption for estate taxes that can be used at any time, not only at the time of death. Knowing how to use the exemption can be an essential tool for reducing a tax bill before passing an asset on to a child.

So, what exactly is the estate tax exemption? Let’s say that you have an asset or an account that you expect to grow exponentially in the coming years. Right now, the value of that business is less than the estate tax minimum. In the future, you expect it to grow beyond this exemption. (In most cases, this type of asset will be a business.) Because you can use the lifetime exemption at any time, if you give away the business to a child or grandchild before it passes above the estate tax minimum limit, there will be no estate tax on the asset when you pass on.

Using a Trust Structure for Your Most Important and Valuable Assets

Establishing a trust is one of the best ways to avoid big out of pocket estate tax payments. Many people may hesitate at the idea of handing over large chunks of assets to others inside of a trust. However, the rules say that the person managing a trust can be a trusted family member, or even yourself.

A trust is one of the most sophisticated tax umbrella structures available to individuals. As such, it requires careful planning and coordination of care to establish & employ correctly. The type of trust that you choose can also make a difference.

If you are serious about preserving your legacy, it is essential that you craft your trusts with the right legal help.  

Using Life Insurance to Protect Your Assets

First, this is not financial advice.  However, life insurance is a conversation we often have with clients and there are certainly a lot of tie-ins to your insurance policies and a healthy estate plan. 

Some of the best life insurance policies, for high net worth individuals (HNWIs) for example, may include provisions for paying off any estate taxes that are due at the time of death. To enable this kind of benefit, you might want to, again, set up a trust.  Regardless, these financial maneuvers and plans should be discussed with your estate planning attorney. 

In short, using life insurance smartly is a great move for HNWIs who would be concerned about the effects of estate taxes on their heirs inheritance(s).

Additional Items to Consider Regarding Your Estate Taxes

Now that we have gone over a few strategies that you can employ to shield your assets from estate taxes, let’s go over a few things that you need to know so that you can go to your attorney as informed as possible.

  • A relatively new tax law (The Tax Cuts and Jobs Act) allows you to give away slightly over $11 million over your lifetime in gifts that will not be taxed subsequently on your estate. This law will only last until the end of 2025. After that, it will fall back to $5 million, meaning that anything more that you give away may get taxed by the IRS starting in 2026.
  • If you are able to get your gifts to your loved ones before 2025, the United States Treasury and the IRS are likely to allow those transfers to stay as tax-favored gifts.
  • However, depending on your situation, using the “step-up” basis may actually save your family more money. The step-up basis allows an asset to be valued at its cost basis at the time of passage rather than at the time of acquisition. Stepping up the cost basis wipes out any paper profit the asset may have generated in the past, reducing the basis for the estate tax.

What Is the Answer? Get the Help That You Need Right Now.

We are here to help you with properly managing and maximizing the tax umbrellas available to you for your estate.

Protecting your estate is an ongoing responsibility – one that will require experienced legal assistance for the entire process of establishing your estate plan and modifying it over the coming years and decades, as necessary.

If you are ready to protect your hard-earned lifetime work, contact us today!

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How Planning for Being Incapacitated Will Strengthen Your Whole Family & Estate Plan

When you think about it, planning your estate is not about dying. It’s about managing and protecting your assets, and who gets to control them, while you are living.

If you become incapacitated, having an incapacity plan in with your overall estate plan ensures that your best interests are clear. It also ensures your family is taken care of.

Why An Incapacity Plan?

If you become seriously ill or develop conditions affecting your memory, you may not be able to handle your finances without assistance. If you do not have a power of attorney, there could be a delay in handling essential matters such as paying a mortgage or filing taxes. Eventually, someone else will be appointed to manage your affairs, hopefully before you have done permanent damage to your estate.

To get ahead of these potentially catastrophic situations you can designate someone today to manage your affairs, care for you, seek treatment on your behalf, and generally make sure everything is handled how you would (or would have) handle them.

Build Your Plan

When you begin your estate planning, remember the following are essential documents that build your incapacity plan into your overall estate plan.

Living Trust

A revocable living trust is good to have for many reasons, including as security in the event you are ever incapacitated. All strong estate plans include a living trust.

In this trust document, you place assets such as your home, investments, and bank accounts. They move from your name to the trust’s name. You become both trustee and beneficiary.

You manage and use your assets as you always have. A living trust is revocable, which means you can change it later if you wish.

Your trust will list a successor trustee to step in if you die or become incapacitated. Your successor trustee is bound by the instructions you included in the trust.

He or she must manage your assets as you intended. When asked how to create an estate plan, attorneys often recommend living trusts because they provide peace of mind as well as financial protection.

Financial Power of Attorney

As mentioned earlier, the financial Power of Attorney (POA) appoints someone as your agent to pay bills and manage other financial matters. Even if you have a living trust, the POA provides extra securities.

Your POA can be durable, which means it can’t be revoked should you become incapacitated. It can also be springing, which means it doesn’t take effect unless you become incapacitated.

Estate planners understand and can explain the additional advantages of each type of POA.

Medical Power of Attorney

In some states, the medical POA is called a health care proxy or Designation of Patient Advocate (DPA). If you become incapacitated, it gives your chosen agent the authority to make medical decisions for you.

HIPAA Authorization

Federal laws known as th Health Insurance Portability and Accountability Act (HIPPA) are in place to protect your privacy and other patient rights. Medical providers often cannot share your medical information.

If you sign a HIPAA authorization, your medical team can communicate needed information to your family and medical POA.

Living Will

living will is not the same thing as a medical POA. A living will states your wishes when it comes to end-of-life care.

A living will is not enforceable in all states, but it allows you to convey critical information about your wishes should you become incapacitated and unable to express those wishes when it is time.

Contact Your Estate Planning Attorney

If your estate plan does not have all five of these documents, or if you do not already have an estate plan set up, it is time to talk to an estate planning attorney.

Contact Us today to get your estate plan and incapacity plan setup.

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How You Can and Should Educate Your Family About Your Estate Planning Forms

How You Can and Should Educate Your Family About Your Estate Planning Forms

Having an estate plan in order is the best way to protect your family if you unexpectedly die or become disabled.

Fundamentally, an estate plan is a collection of necessary forms and instructions for people to use and follow when they eventually become necessary (and they will someday).

Once you have estate plan established, and forms ready – with instructions – you still need to educate your family and other key parties about them.

Let us look at how you can do this and why you should do this.

Critical Estate Planning Forms

Again, Estate planning forms are where you put your wishes in writing –  so that your family and loved ones know exactly what you want when you die or become incapacitated.

Some of the planning forms you should have are:

  • Will/ Trust: This is where you put what you want to happen to your property. It is important to have a will or trust even if you do not have substantial assets.  Having a will or trust will help with probate and make it easier for things to be divided.
  • Durable Power of Attorney for Finances: This document names a person to take care of your finances for you.  This should be a person that you trust to make decisions you would want.
  • Durable Power of Attorney for Healthcare: This document names a person to make your healthcare decisions for you. You can have the same person for your finances and healthcare if you wish but do not have to.  Make sure the person you choose, knows what you want for your healthcare if you cannot make those decisions for yourself.
  • Beneficiary Designations: There are certain types of assets, such as life insurance, that does not get dictated by your will. If you do not have a beneficiary designated for these items, then the court can determine who will be your beneficiary.
  • Letter of Intent: This is where you will define what you want to be done with certain items. It can include what you would like for your funeral services or other special requests.  You can also add in a letter of intent, your wishes for the way your children should be raised and what types of decisions should be made regarding education, schooling, and other important situations.
  • Guardianship Designations: This is where you will name a guardian for your children and a backup guardian in case the original guardian cannot fulfill the role. Sometimes this is done within the will but if it is not then you need to have a separate place for it. If you do not name a guardian, then the court will place your children with who they believe to be best for your children.

How To Educate Your Family About Your Estate Planning Forms

This is very easy.

Discuss with your family what planning forms you have used as well as what you have put in them.  Also, make sure to keep all of your estate planning forms together in a secure place and that at least one or two family members know how to find them.

For guardianship designation, make sure that whoever you choose also has a copy of the form.  This is important in case your copy cannot be found.

Of course, just because we say it’s easy – doesn’t make it so!  We’re always here to help as well.  We can provide great ideas, for instance, we constantly have classes and other outreach opportunities they can attend.  OR – perhaps they need an estate plan themselves, after seeing how this plan has helped set you and your family up for success.  Sometimes the best education is doing something in the first place.  We certainly love referrals!

I Need Help Talking About This With My Family OR I Need An Estate Plan Myself, Today!
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How to Help Your Family Use Your Estate Planning Forms in An Emergency

How to Help Your Family Use Your Estate Planning Forms in An Emergency

In an emergency, everything is chaotic and stressful. Family members are often distraught and unable to clearly (and quickly) think about your wishes.

What will happen to your children if you and your spouse are no longer able to care for them or yourselves? How will your family know your wishes or have access to any legal information?

Using your estate planning forms can help your family and prevent them from having to go to court to receive authority to make decisions if there is an emergency.

Here are six estate planning forms and ideas you can use and how they can help your family in an emergency.

Guardianship Plan

A guardianship plan lays out your wishes for your children if you, or yourself if you become incapacitated. This estate planning form gives medical, financial, and legal decision-making abilities to a trusted person you choose. This person will act on your behalf when making these decisions while ensuring your wishes are considered.

Why is a guardianship plan important to have in an emergency? A guardianship plan can be used to give a trusted person temporary guardianship of you or your family (kids) in case of an emergency. We are talking about if you are unable to care for your children because of a hospitalization or a severe injury.

The person you choose will be able to make educational and medical decisions in your place for the child until you are well enough. If you, unfortunately, die during an emergency, your children will know where they are going and who is going to take care of them; hopefully making the transition a little easier.

If you work with an attorney to set up a guardianship plan, they will have a hard copy available. However, as with all plans, you should go over the details with all those you identify in the plan as potential guardians. Go over who to contact, in what order to contact them, and game plan different scenarios. Your family protection plan attorney will help you figure this all out and ensure you have all necessary guardianship and estate planning forms set up.

Healthcare Power of Attorney / Health Care Directive (Living Will)

A healthcare power of attorney (HPOA) legally allows a person of your choosing to make decisions regarding your healthcare. This HPOA can be as broad as possible, or you can limit to specific types of decisions made for you. Sometimes, healthcare power of attorney will be combined with a health care directive or living will. A healthcare directive specifies what you want if you need life-saving measures. Some of these may include whether you receive artificial hydration (IV) and nutrition (feeding tube), or if you do not wish to be resuscitated in an emergency.

These forms are very beneficial to have in an emergency. If you are admitted to the emergency room, the hospital will do everything in its powers to keep you alive. They will put you on a life support if needed. However, what if that is not you want? Filling out a health care directive will lay out your wishes and enable a person of your choosing to make those wishes happen for you.

If you do not have a health care directive, then having a healthcare power of attorney (POA) gives a trusted friend or loved one the opportunity to make your wishes known. Having these forms (and putting them where a loved one can find them) will allow your wishes to be met in an emergency situation.

To use them in an emergency, make sure these forms are available and accessible to your loved ones. Create a phone call list and instructions for your family, spouse, kids, babysitter, etc. to follow in case they need to contact the person you designated to make these literal life or death decisions for you.

Financial Power of Attorney

A financial power of attorney is very similar to the healthcare power of attorney in that you are choosing a person to make decisions on your behalf. The biggest difference is that in this case, you are allowing a trusted person to make financial decisions or acts such as withdrawing money from your bank account our signing papers for you regarding real estate.

Appointing a financial power of attorney (POA), will allow your finances to be kept in order either after you pass or while you are incapacitated. In an emergency situation, the financial POA can supply the guardian of your children funds to be able to care for the children or even pay your medical bills you are accruing if you are hospitalized.

Ensuring you have your financial POA stored in an accessible location with your other estate planning forms is a necessity for the person that you are designating to start taking steps to handle your finances. Keep your forms somewhere they can be accessed and leave instructions for accessing and using them to your next of kin. Your estate planning attorney will also maintain a copy, so keep us on your contact list as well.

Insurance Policy & Other Important Estate Planning Forms and Documents

Having a life insurance policy in place will greatly help your family financially if something happens to you. Life insurance will help replace lost income, cover burial expenses, pay off any of your debt, and pay any estate taxes.

In addition to life insurance there are many other important documents:

  • Final arrangement plans to let your family know the particulars of your final arrangement. This will ease their need to make decisions.
  • Contact sheets giving your loved one contact information for important people such as babysitters, neighbors, who to contact if you do not come home, etc.
  • Trusts which pass on specific assets to a beneficiary bypassing probate.
  • Tax documents
  • Investments
  • Photographic itemizations of assets

Again, having these forms done and put somewhere easily found, will help put your family at ease. It could be the difference between your children being placed immediately in the custody of a close family member or family friend (by your designation) or them ending up in foster care while a court determines who is the most appropriate caretaker, if any, amongst your family and friends.

If you want to know more about how this could all play out, read: WEAR CLEAN UNDERWEAR. We will even provide you a copy!

Password Lists As An Estate Planning Form?

Having a list of passwords almost seems silly. Why set up a password if you are going to document them? Your family may need to access accounts online and will not be able to without your passwords. In today’s technological age, many different things are done online and with passwords including online banking.

In an emergency, your family may need to access your online banking account, your email, etc. To do this, they will need to know what your passwords are. For example, you end up hospitalized and in a coma. The only way for your neighbor to contact your family is to access your contacts on your phone. How are they supposed to that? Keeping a list of passwords somewhere a trusted person knows about will allow them to access password protected things that may be needed in an emergency.

Account Lists As An Estate Planning Form?

A list of all of your accounts will also help your family know where to look for information such as banking. Listing your email account is important as well so your family can get any important information that may be sent by email. There is an application you can install on your smartphone that will allow you to list your accounts and passwords.

Just like a password list, a list of accounts will be helpful to your family in an emergency. If you pass away, your family will need to know where you bank, who you use for phone service, etc. They need to know so they can cancel accounts if need or change the terms of service.

Account lists are an often overlooked part of estate planning, but are something you should include in your estate planning forms if you have not done so already.


If you found this article helpful, take a look at A Young Family’s Guide to a Rock Solid Estate Plan


A Young Family’s Guide to a Rock Solid Estate Plan

If you are under 40 years old, the chances of you have thought about, or even pursuing estate planning is pretty small. However, something brought you here, and that means you are on your way to changing the way you look at planning your future!

The exploration of life planning that brought you here is the reason we started doing estate planning for families here at Lilac City Law in the first place. We believe that the best time for you to set up an incredible estate plan is when you are young; maybe even before you have children! So, where we begin this exploration in estate and life planning?

What step do you take first to get you from realizing an estate plan makes sense, protects you and your family, and is something you can do regardless of your asset profile?

Let’s look at the path to estate planning, step-by-step, and help you get prepared to engage with an estate planning attorney who has already established some basic fluency in this topic.

Estate Plan: The First Step, Get Started

Probably the best thing to know about starting an estate plan is the first step can be free. Set up your Protection Plan. This action alone knocks off several of the items we are going to be discussing later in this article. You can do set up your free protection plan here. Moreover, if something happens to you or your family while you are working on the rest of your plan, you will be set up with at least some security.

Get Started Here – Set Up Your Protection Plan

Estate Plan: The Second Step, Read Wear Clean Underwear

We cannot recommend enough grabbing a copy of Wear Clean Underwear. This book breaks down the reasons why you should be considering an estate plan in incredible detail. From the very beginning, you get to choose your adventure and see how common life scenarios play out depending on what estate planning decisions you make. If there is a list of books you should be giving new families, this book should be high on that list.

Estate Plan: The Third Step, Get Familiar with Estate Planning Items

If you completed step 1 above, awesome! Hopefully, you have step 2 bookmarked, now. And now for the third step, review the following fundamental elements of a comprehensive estate plan.

Estate Plan: Establish Your Last Will & Testament

When most people think about life planning, and how to set up their family after their passing, they think about establishing a will. A will is often more formally titled, a Last Will and Testament. But what is it? And, why do you want one, or need one?

A Last Will and Testament helps you to direct the transition of your assets to family members, friends, or whomever else after you pass away. It is almost always a formal legal document; however, there are cases where a court has upheld a will etched on to the paint of a tractor, and there are indeed other extreme examples of last-minute wills. For the sake of estate planning, we are sticking to a document you draft with your family and your estate planning attorney though! 🙂

The benefits of a Last Will and Testament are that they can cover items that a living trust may not cover. With a Trust, you are trying to transfer assets without having to go through the process of probate. Probate is costly and can be bypassed to a great extent with estate planning. However, you will not be able to continuously transfer all your assets to a Trust, no matter how diligent you are. A Last Will and Testament will help you here by covering things you have left out of your trust either by accident or on purpose.

In addition to unaddressed assets, a Trust cannot declare who will be the final guardian of your children in the event of an untimely passing. This contingency, in particular, is something your Last Will and Testament will spell out explicitly. Moreover, this scenario is also why you would benefit from working with an excellent estate planning attorney to set it up. Read the book we talked about in step two to see why, for your kids’ sake, this is something you want to work through in extensive detail.

Estate Plan: Advanced Health Care Directive

An advanced health care directive is a document in which you can set down your end-of-life preferences. You can also appoint someone in your directive to act on your behalf in making health care decisions for you, assuming you cannot make them for yourself.

Without a health care directive, your end of life care may be decided by doctors who do not know you and are unable to get your direct consent to treat (or not to treat).

An advanced directive is also often called a living will.

Estate Plan: Health & Financial Powers of Attorney

If it comes to pass that you are unable to manage your finances, or direct your self-care, who will take care of those things? If your spouse or partner is your #1 choice, that is a great plan. But, what if they are not able to help you out? Maybe they passed away, you split up, or they are simply out of town when something happens?

Health & Financial Powers of Attorney enable someone you trust to both acts on your behalf financially and in health care decisions for you. These Powers of Attorney (POA) also allow your designee to obtain information on your behalf. We wrote a great article on how this can work well, and how things can go sideways without these documents. It is worth a read, here.

Estate Plan: Kids Protection Plan

A Kids’ Protection Plan is not necessarily one static document. Instead, it is probably best looked at as the state of your estate and family planning. Are your kids set up to be taken care of if you pass before they are grown?

While you are exploring estate planning, this is something you want to get set up as soon as reasonably possible. Meaning, to start, we should not make the perfect the enemy of the good. Get a basic kids protection plan set up, here. The basic plan will give you and your family some level of protection as you work through the more granular aspects of estate planning.

Eventually, you will want to establish custody rights in your Last Will & Testament. Likewise, you will want to set up how your assets will transfer to your children if that is your desire. Also, you will want to set up many other things with other steps we talk about in this article.

So, step one for kids’ protection, keep them out of the custody of the state, get a guardianship set up here.  Step 2 ~ 100, talk to an estate planning attorney.

Estate Plan: Final Arrangements Plan

The particulars of your final arrangments are likely to be as unique as you are! However, the broad strokes things you might want to cover and leave in a place where your family can find them, include:

Your desire for what will happen to your body. Do you want your remains to be buried or cremated? Are you ok with embalming?

Do you have a preference on who will be handling your remains for burial or cremation? Have you worked with a specific mortuary in the past? Do you already have arrangments with them to take care of you?

Where will you be buried, interred, or placed? Is there a particular cemetery or location you have in mind? Are there actions you wish to be taken at that event?

If you are a Veteran and want to be interred at a National Cemetery, do you have a copy of your DD214 available and the number for the National Cemetery Administration ready for your family or caretakers to quickly make arrangments?

Have you already made provisions for a casket? Do you wish a certain type of casket or container be used? How do you want this to be paid, if you have not already paid for it? Do you want an open or closed casket funeral, if the choice is available?

Who will be your pallbearers? How do you want to be transported to your final resting place? Who will scatter your ashes, and in what way? Do you have funeral preferences?

Is there a marker you wish placed on your final resting place; a gravestone? Alternatively, a particular engraving to go on whatever marker you have set up?

Estate Plan: Business Documents

If you are a business owner, you might have given some thought to what you want to happen to your business if you are not around to operate it anymore. Even if you have not, it is probably a good idea to establish some contingencies. Exactly how the contingencies are setup will be predicated on many factors, including business structure, partners, debt, industry, products, and a million other things.

The best bet here is to talk to an estate planning attorney and work through a planning process. What do you want to happen; a transfer of ownership? A sale of the business (who will the proceeds go to)? We are scratching the surface on this issue, but the important thing to remember is that all your plans for your business can be worked out in advance; you just need to start the process today.

Estate Plan: Insurance Policies

Do you have life insurance setup? We are not writing this article to tell you whether to do so or not; we only want you to be able to help you transfer all your assets and investments where they are supposed to go. To do that, you will need to have a list of your insurance policies ready and the individual procedures and points of contact setup at those policies.

Don’t forget that credit cards and other items that might involve debt often have the option to provide life insurance too! You may have a policy set up that you did not even realize you had!

Regardless, get your plans laid out for your family to work through, get your beneficiaries lined up, and establish a plan for transferring the payout to whomever you wish to designate.

Estate Plan: Tax Materials

Owing taxes after your passing is maybe the ultimate injury to insult! However, if you own property your property will remain after your passing, and the taxes will too, sadly. Your beneficiaries will need to be instructed on how, when, and whom to pay taxes. They may also need a historical account of your taxes, for any number of reasons.

Estate Plan: Investments & Accounts

While you are getting your insurance and tax documents in order, you should be laying out any investments and bank accounts you might have as well. This list will be very helpful for your financial power of attorney, and/or your family when you pass.

It is important to think about this as more than your bank accounts too. Don’t forget 401k, stocks, bonds, bitcoins, IRA’s and other forms of investment.

Estate Plan: Trusts in Addition to Last Wills and Testaments

We covered Trusts, as they relate to Wills, earlier in this article. In many ways, Trusts and wills seek to fulfill the same ends but by very different means. Whereas a Will grants property and assets to a designee, it is often more open-ended. It is also far more restrictive in updating.  Here’s another article that compares the two as well.

If you need to amend a Will, you either have to go through a public court proceeding, or you have to scrap it all and start over. The thing is if you create a Will years or even decades before your passing and you intend it to speak to every aspect of your estate, it will be very open to interpretation. This point is where a probate court will come in, and on top of taking a hefty portion of your estate value in fees, the court will seek to interpret your will. Do you want someone who does not know you to understand the intentions that you put on paper 20 years ago? < This is where a Trust can help and work in tandem with your will.

You can use a trust to pass specific assets on to a beneficiary, bypassing probate entirely. Moreover, if you avoid probate through establishing a trust, you keep the details of your asset profile out of public records. This benefit in itself is self-evident. If you value the potential information on your children’s assets to be kept private from unscrupulous “advisors,” transferring those assets in a trust is one way to go. Can you tell we value privacy?

Lastly, a trust is easy to update, especially in comparison to a Last Will and Testament. A phone call to your estate attorney once a quarter and you will have a trust that is ready to be executed once the parameters you have decreed have been established. You can read more about how a trust is implemented in this article from our blog.

Estate Plan: Contact Sheets

Does your sister in law have your babysitter’s contact information? How about your parents, do they know how to get ahold of your spouse’s cousin who lives next door? It is imperative that you have contact sheets created for key points of contact, and that those contact sheets are readily available.

More to this point, you will want to have a procedure set up for what happens if the way someone learns something has happened to you is that you haven’t come home. Do they call the police first? Do they call your neighbor who knows your children’s guardianship plan and has access to it?

Again, read this book – free with this offer, to see why this is so very important. Then contact an estate planning attorney to get the ball rolling on this.

Estate Plan: Passwords & Account Information

How secure is your Facebook account? Does anyone else have your password? Your spouse, your kids? You would probably know because if they did, they would no-doubt be posting practical jokes all the time from your account, right?

Kidding aside, it makes a lot of sense why you wouldn’t share your social media, email, or other account passwords with someone else. Why would you even have a password if you started sharing it? Plus, passwords now have to change often anyway, so keeping a physical and updated copy can be a challenge.

The solution here might depend on your preferences. Whether it is a physical sheet of paper you keep in a safe place, or an Application you install on your smartphone, it is a good idea to have some way for those you care about to be able to access your important accounts in an emergency, or after you pass.

Estate Plan: Emergency Cash

Have you ever thought of storing some cash in your mattress? Ok, well maybe somewhere a bit more secure… The point being, you do not know what will be the emergency that makes your estate plan necessary. In actuality, there may be several emergencies throughout your life that part of your estate plan becomes necessary to address.

Part of what makes a rock solid estate plan so comprehensive is that it addresses as best as possible all those nebulous potentialities. The estate plan is specific where it needs to be, but flexible enough to handle the unknowable unknowns. In regards to flexibility, cash is king.

Cash is immeasurably useful; it is easy to transfer (hand it over). It is accepted universally. It can be easily secured. Also, you do not need anyone’s help to build a small but capable emergency stash, just in case you need it someday. Make sure cash is part of your emergency estate planning, and make sure it is readily available.

Estate Plan: A Photographic Itemizations of Assets

This idea crosses over into good insurance practice too. You can describe your assets in great detail, but as it has been said, “a picture is worth a thousand words.”

Keep a photo diary or photo catalog of your assets. It may come to pass that your desire to transfer certain assets might not be as descriptive as necessary if there is some contention. If however, you include a picture of that property, as well as a description of it, you leave a whole lot less up for doubt.

Plus, as we said a second ago, keeping photos of your assets is helpful for insurance purposes too. So, it just is a good, and cheap, safety measure to incorporate into your regular estate planning.

Estate Plan: Photos & Recording of Yourself!

While you are thinking about pictures, you may want to put some physical pictures away in a safe too. Or at the least, start uploading them to the cloud via Dropbox. Another option is using several USB sticks.

Why would you want to do this? For your family, your kids in particular. This idea depends on how much you wish to leave behind for your family to know you by. Many families create these digital memories and never need them. They send them with their kids when they leave home or watch them with them at their milestone birthdays; which is also pretty awesome! However, some families will have these become part of their record to their children of who they were when they were alive.

In the end, photos and recordings of yourself are not necessary for your estate plan. But, they are a touching gesture for your family, should you pass.

Estate Plan: Store Your Estate Plan in Different Places

Lastly, in our rundown of estate plan musts, store your plan in several places. Or at the very least, store it in one very secure place. This plan is going to be important to your family at some point. If it is when you have passed, you will not be able to tell them where or how to access it, if you moved it.

In fact, you might have lost a physical copy of your plan due to an accident, a fire, moving, or something else. It happens! Keep the details of your plan safe.

Estate Plan: The Most Important Last Piece

One option for this is to work with an estate planning attorney. Once they find out that your plan is necessary, they will immediately become part of the team to triage your needs and the needs of your family. Do you have a guardianship plan, so your kids do not end up wards of the state? If so, your estate planning attorney will know where it is, how it works, the limits and rights it grants, and how to execute it immediately.

On top of everything else we discussed in this article, having a trusted advisor in the form of an estate planning attorney is the most important “must have” in this entire article.

You can contact Lilac City Law, here.  Or fill out the form below.   Find out why we are rated 5/5 stars on Google!