Estate Planning involves the drafting of documents to protect against incapacity and to establish after-death protections and wishes. Estate tax exposure, minor children’s and/or disabled or aging relatives’ needs, controlling nursing home costs, general liability protection, and business succession goals are all addressed by a comprehensive estate plan.
Health Care Proxy
A Health Care Proxy allows you to appoint someone, called your “health care agent,” to make health care decisions on your behalf, in the event you are unable to make the decisions yourself. By law, a physician must declare that you are incapable of making medical decisions, even if only on a temporary basis, before your agent can have any authority. This document does not specify what your wishes are, but rather names the person who will make your medical decisions. Health Care Proxies are extremely important if decisions need to be made concerning necessary medical procedures or termination of life support. It can also alleviate the need to have a court-appointed Guardian make medical decisions for you.
This is a companion to the Health Care Proxy. The proxy names the individual you wish to make the decisions and the Living Will expresses in writing your wishes with respect to end-of-life decisions. Although not legally enforceable in Massachusetts, this is a helpful document because it provides evidence of your wishes for your family and any other interested third party (e.g., a hospital or a court).
HIPAA Release Designation
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) contains privacy regulations which require virtually every physician, dentist, nurse, pharmacist, laboratory, and health care provider in the nation to limit access to confidential medical records and information. In order for your family members, friends, and/or designated health care agents to obtain individually identifiable health information about you, you must specifically authorize disclosure to these people as well as release of the information in writing.
A Durable Power of Attorney allows you to name another person or persons to sign your name and perform acts on your behalf. This person is called your “attorney-in-fact.” Examples of acts your attorney-in-fact may perform include accessing your bank accounts, paying bills, managing your investments, and selling real estate. Your Power of Attorney is typically effective upon signing and is valid until death or revocation. A Durable Power of Attorney can avoid the need to have a court-appointed Conservator make financial decisions for you.
Durable Powers of Attorney
A Will is a document that specifies how you want your real estate and personal property to be distributed upon your death through the Probate Court process. It outlines who, what, when, and how your property will be distributed. Assets which pass through your Will (and thus are overseen by the Probate Court) include any and all assets that are held in your individual name at your death or which designate your estate as beneficiary.
If a person dies without a Will, his/her property is distributed in accordance with the laws of intestacy. Essentially, the Commonwealth of Massachusetts provides a Will for you and distributes your assets and property to your blood relatives in certain portions as dictated by law.
Wills nominate a Personal Representative to administer your Estate, a Trustee to manage any funds to be held in trust beyond your death, and a Guardian to raise any minor children.
Any asset that names a co-owner or has a named beneficiary is considered a “non-probate” asset. Those non-probate assets are not controlled by the terms of a Will, but rather the beneficiary designations. Because non-probate assets pass automatically at your death regardless of the terms of your Will, it is important to review beneficiary designations and make sure they are coordinated with your overall plan and your Will.
Last Will and Testament
A Trust is a legal document which is incorporated into your estate plan to accomplish a specific goal—it is not a one-size fits all document. There are several types of trusts including living, testamentary, revocable, irrevocable, and realty trusts. A trust is helpful to avoid probate, to provide for the management of property beyond your death, to save taxes, to protect assets, and to preserve benefits that a beneficiary may be receiving from a governmental agency.
The attorneys at The Law Office of Kimberly L. Kelly, LLP work with our clients to determine if a trust vehicle makes sense for your estate plan objectives and if so, works with you to design the best trust for your needs.