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Category: Retirement Planning

Why Same-Sex Couples In California Need A Community Property Agreement Now

Posted on by khateam

Did you know that many real estate professionals who handle the titling of real property assets for same-sex couples many times are ignorant of titling rules for those couples?

This is a subset of the law in California that same-sex couples must be aware of even if they’ve been cohabitating for many years.  Married same-sex couples who have been together a long time, but only recently legally married, will not have community property and will lose the significant tax benefits on the death of the first spouse unless they make certain decisions to protect their community property assets.

Same-Sex Couples & Community Property Rights

When you are planning your estate you might not think about how your living arrangements may affect it.  For example, if you have lived with someone for a long time and have had a lifetime partnership with them, sharing the expenses and purchasing a home together, you would think that would be the same as a normal married couple.

However, it’s actually not. There are different laws that apply for people that have had a long term relationship but are not actually married. This also, sadly, is how it is for many of our married gay couples.

When you buy a house together you think of it as community property.  Community property means that it is both yours equally.  Community property is everything that is purchased during the marriage. However, if you waited a long time to be married, then the rules are different.

Because the marriage of gay couples wasn’t even possible until recently under California law, there are many same-sex couples finding out that they, in fact, don’t have the rights they thought they had.  We are seeing more and more of this costly mistake and want to make people aware.  There is a document that you can sign that will make the property community called a “community property agreement”.  This is something that you need to discuss with your estate planning attorney.

Why You Need a Community Property Agreement

So, let’s try to break this down a bit and hopefully help better explain it.  Let’s say you own a rental property with your partner that is now worth $1,000,000.  You both agree to sell the property.  You purchased the property many years prior for $200K, and so upon sale of the property you would have to pay capital gains tax on $800K. (The cost basis is $200,000.  If this was depreciated rental property, the cost basis would be as low as zero.)  When someone dies, their share gets a 100% stepped-up basis.  If the property is jointly owned, such as joint tenancy or tenants in common, 1/2 the property would get a stepped-up basis of $500,000.

But – and this is the important part – for community property, the surviving spouse gets a 100% step-up on the entire property, so this property would be stepped up to $1,000,000.  This means it can (1) be sold without capital gains tax or (2) be depreciated all over again, meaning a huge annual income tax deduction for the surviving spouse.

The concern is that same-sex couples who have been together for many years but only just recently married, will not have their assets properly designated as community property.  This can be fixed by getting a signed community property agreement.

Clearing Up The Confusion of Step-Up Rules

There are a lot of confusing rules about the stepped-up basis.  However, you can have all of your questions answered by speaking with an estate planning attorney who is an expert about these rules. 

Take the time to do some research on this, and if you find it difficult to understand make an appointment with The Law Offices of Joel A Harris.  Don’t leave a tax mess for your spouse or long term partner.

The Law Offices of Joel A Harris are more than prepared to provide you with legal counsel. Joel Harris is an attorney with 30 years of experience and is extremely familiar with how the law affects same-sex couples and their rights. If you are not sure how to begin, or you just want some help navigating the ins and outs of protecting your retirement and estate, feel free to visit us online, in person or call us by phone at (925) 757-4605.

Create Your Digital Inheritance Plan

Posted on by khateam

With the rise of the digital age, the idea of having a digital inheritance plan in place has become more of a necessity than ever before. It’s not commonly thought about, but what happens to your Facebook account when you cannot manage it anymore? What about that obscure membership you joined so you could get 2 free movies a month in the movie theater? It may sound strange, but these online accounts are considered assets, and as such, you should have a plan in place for handling them when the time comes. We have created a quick cheat sheet to address how to handle setting up this kind of digital inheritance.

1) Make a List of Your Accounts, Logins, and Passwords – With Dates!

This sounds like a daunting task, but it should not be taken too lightly. Many of us have a massive amount of accounts. From email to social media to healthcare portals to software licenses the average person has about 90 online accounts! If you are an online shopper that number can increase by 10 times! Organizing them, recording all the passwords and usernames will take some time. However, if someone is going to take over managing them, they will need to know what they are managing and how to get into the account. Additionally, digital devices that have value should also be considered in the inventory. The computer you paid $3,000 for last year still has value, and you should take note of that device so your digital executor will know what you want to be done with it.

2) Make a Choice on What to do with your accounts and hardware

Once you have all of your accounts and devices organized with the logins, recovery questions, and phone numbers, you will need to make choices. What do you want to be done with your Amazon Prime account? Can it get passed on to your husband? What about your Spotify membership? Should it just be canceled? How about your Facebook account? You will also need to look up the contracts of some of the accounts since sometimes membership cannot be transferred, so that account will need to be closed. For devices with personal information (computers, tablets, etc.) you will want to decide if that information needs to be saved and what can be erased.

3) Appoint Someone You Trust

Again, this decision requires careful thought. If you have organized everything well, it should not be too difficult to hand over the information to your Executor or Trustee. This is often a trusted family member, friend or trust company. Your “digital executor” does not have to be the person named in your Will or Trust to handle all of your other assets. It can be someone specially designated to take care of the digital side of your estate. However, make sure that they are listed in your estate plan as your digital executor or trustee.

4) Store Your List of Organized Logins

Now that you have a list of all of your logins for every device and account that you own, you need to store it in a safe place. If this list falls into the wrong hands your accounts will be vulnerable. Additionally, you will need to keep this list someplace fairly accessible, so that you can update it as you gain new accounts, change passwords, etc. Some safe places include with your attorney, in a digital locker, or in a physically secure location (a file cabinet or lockbox).

What Should I Do Now?

Digital inheritance planning is difficult, and you may still have some remaining questions. The Law Offices of Joel A Harris are more than prepared to provide you with legal counsel pertaining to your planning, execution, or, and any other legal concerns or questions you may have. The Law Offices of Joel A Harris, located in Concord, Walnut Creek, and Antioch are available to help you to the best of their abilities. Joel Harris is an attorney with over 25 years of experience and is extremely familiar with this process. If you are not sure how to begin, or you just want some help navigating the legal side of your digital inheritance process, feel free to visit us online, in person or call us by phone at (925) 757-4605.

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What Will The SECURE Act Mean For My Retirement Plans?

Posted on by khateam

What Will The SECURE Act Mean For My Retirement Plans?

What are your retirement plans? Have you thought about how you will pay for your housing situation? Have you reserved enough money for extra expenses? Will the retirement age change by the time you retire? All of these questions are valid and you should take them into consideration as you grow older. With policies changing regularly, it is critical to stay up-to-date to be prepared for any situation.

In 2019 the senate will decide whether they approve the changes for the current retirement requirements or if they will make any changes at all. With the House of Representatives already approving the Setting Every Community Up for Retirement Enhancement Act (SECURE Art), the requirements for new retirement plans will change. If passed, you can expect some changes to be:

  • More part-time positions offering 401(K) plans
  • Contribution to traditional IRA’s (Individual Retirement Arrangements) for as long as desired
  • Penalty-free withdrawals for those who fall into specific groups/circumstances
  • The age for retirement to move from 70 ½ to 72 years of age
  • A requirement to withdraw from inherited retirement accounts within 10 years of retiring

Retirement should be an exciting time, away from confusing language and ever changing politics. For this reason, The Law Offices of Joel A. Harris works hard to provide you with information to make it easier for you to understand the new changes the SECURE Act brings. We are located in Concord, Walnut Creek and Antioch, to be most convenient to our clients. If you would like to visit us in person, by phone at (925) 757-4605 or via website, feel free to contact us and we will be more than happy to help!

What Changes Will I See?

There are quite a few changes that you can expect once the SECURE Act is passed and put into practice. Below are a few changes that you can expect and how you can prepare for them to better your retirement experience:

  • Part-Time 401(K) Options: There is currently a minimum number of hours worked in one year (~1000 hrs.) that decides if a worker is eligible for a 401(K) account. With the SECURE Act part-time workers will become eligible for a 401(K) account, so that they can start adding funds to their future income. If you would like to read more in detail about this change, go here.
  • Inclusion of Academic Income: At the moment, certain academic stipends and non-tuition aid are not treated as income for purposes of IRA contributions. With the SECURE Act in place, these kinds of aid and financial support will be included as a form of income. This means that higher taxes may be paid, but more money may be taken out when needed. If you would like to read more about this, check out this article
  • Removal Of Age Limit For Contributions: The SECURE Act would remove the current age (currently 70 ½ years old) restriction to contribute to a Traditional IRA. This change can be seen as a positive change since the age of retirement may change over time, which would affect the age restriction. If you would like to learn more about this, we recommend that you read this article.
  • Limitations on Tax-Advantages After Death: A benefit that was available to families in the past has been the inheritance of retirement funds. This option became popular in the 1960’s and can still be seen today. With the SECURE Act in place, family members who benefit from retirement inheritance may find themselves with stricter time limits on both the time it takes to withdraw the money, as well as how much can be withdrawn at one time. If you would like to read more, you can go here.
  • Penalty-Free Withdrawals for Birth or Adoption of Child: The changes to the SECURE Act would allow new parents, biological or adoptive, to take up to $5000 from their 401(K), IRA or other retirement accounts. This new change is beneficial for parents since there is also no limit as to how many times a future retiree can use this benefit. It is important to state that new parents should take into consideration their future retirement costs. If you would like to read more about penalty-free withdrawals,, read this article.

What Should I Do Now?

If you are planning to retire shortly or have yet to plan for retirement, The Law Offices of Joel A Harris, located in Concord, Walnut Creek, and Antioch are available to help you plan accordingly. Joel Harris is an attorney with nearly 30 years of experience in estate planning, trust and probate law. Joel works with expert tax and financial planners who can take the time to help you plan for retirement, create a budget, document progress and provide useful reminders pertaining to your personal retirement plan. If you are not sure how to begin planning for retirement, feel free to visit us online, in person or by phone at (925) 757-4605. Our priority is your future success!

Sources

Uniform Trust Decanting Act – What Is It And How You Can Benefit

Posted on by khateam

Decanting a fancy bottle of wine may be familiar to most people, but there is a new type of decanting: trust decanting. The Uniform Trust Decanting Act was enacted in California on September 14th. Trust decanting is a method in which a trustee may distribute trust assets from an old irrevocable trust into a new one, or amend an existing irrevocable trust, without court approval. It has its limitations; only certain trusts can be decanted. You can’t decant a trust established for charities, for example. In this article I will explain what you need to know about the Uniform Trust Decanting Act and how you can take advantage of it to protect your assets.

1. Who Is Involved?

Before exercising decanting power, the trustee must give notice to very specific people who will be involved in the process. These people include the settlor, beneficiaries, trustees of the former trust, trustees of the new trust, and the attorney general in some instances. The act provides specific guidelines as to what the notice should include. A recent modification of this act entails stricter provisions than the original. If you are located in the San Francisco Bay Area, specifically in the cities surrounding Antioch, Concord or Walnut Creek, feel free to reach out to The Law Offices of Joel A. Harris to get more information on what to include.

2. What Is Allowed?

The Trustee of a trust may wish to update legal provisions, correct legal or drafting errors, take advantage of new tax laws, clarify ambiguities, and protect beneficiaries from changed circumstances, health conditions or creditors.

3. What Is Not Allowed?

Not following the regulations of trust decanting can lead to serious consequences. Decanting should not be abused as a way to defeat the settlor’s initial intent. The Uniform Trust Decanting Act prohibits decanting that defeats tax or charitable purposes of the settlor. The more initial control the trustee has over the distributions of the trust, the more freedom they have to modify the trust through decanting. There are provisions as to what can be modified by the trustee. Generally speaking, the most important provision to remember is that trustees cannot change the original beneficial provisions of the trust itself. For more information on what is or is not prohibited, contact The Law Offices of Joel A. Harris.

“The Uniform Trust Decanting Act prohibits decanting that defeats tax or charitable purposes of the settlor.”

4. Who Will Benefit?

Decanting is designed to extend the terms of a trust or make it more safe for those involved. Those who are new beneficiaries may benefit most. This is because they receive new assets that can be used to alleviate health, personal or educational expenses. Also, beneficiaries will likely get exactly what was planned when establishing the trust. The new provisions of the law allow for assets to be better protected. Finally, since the trustee is required to provide 60 days notice prior to the exercise of the decanting power, beneficiaries have time to object to any proposed changes. Our advice is to have all parties entitled to notice sign and approve any trust decanting.

Are You Worried about Your End of Life Plan?

If you are not prepared with a current estate plan then your family could be vulnerable to higher tax bills, extensive legal fees, and familial conflicts. To avoid those obstacles you should visit an Estate Planning Attorney to get professional help, and create a plan that well suits your goals.

The Law Offices of Joel A Harris are located in the cities of Concord, Walnut Creek, and  Antioch, California.  We have worked for nearly 30 years giving the best guidance our clients need to protect their assets. Have a question about your planning your estate? Feel free to schedule a sit-down meeting where we are happy to patiently answer every question you may have. For your free consultation reach out to us at (925) 757-4605.

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5 Things Your Estate Planning Attorney Can’t Do For You

Posted on by khateam

As we all know, most attorneys go above and beyond to ensure their clients are overjoyed with their work; it is important to recognize that attorneys cannot bend rules to get clients out of every nightmare they come across. For years, I have prided myself on my team’s abilities to extricate our clients from any messes they have encountered or even caused. Unfortunately there are some things even I can’t help with – here are five of them for your amusement and enlightenment.

1. We Cannot Abuse Attorney-Client Privilege

Attorney-client privilege is a client’s right to refuse to disclose information that was confidentially shared between themselves and their lawyer. This law encourages clients to share information that will prompt the lawyer to better assist them in their representation. There are certain limitations to this privilege. First, a client cannot use the privilege to further a case of fraud, tort or crime. I can’t help people commit a crime, and keep secrets if they are planning to kill someone. I also can’t help their heirs if they name the wrong beneficiaries on the accounts or keep them out of probate if they don’t properly fund the trust.  If things in their life change and they don’t come in for an update, lawyers can’t be responsible for the big mess that will leave! Remember your lawyer’s legal limits when considering their lawyer-client privilege. Along with abusing privilege, lawyers can also not neglect it. Beneficiaries and clients are entitled to all the information shared between themselves and their lawyer.

2. We Cannot Represent Both a Trustee and a Beneficiary

When I represent the trustee or Executor, I can’t represent a beneficiary, and vice versa. These people will have wildly differing wishes that a single attorney cannot protect. An attorney is responsible for protecting clients but not in any manner that can disparage their clients, and this can include working with multiple clients. Along with this, a lawyer’s loyalty to their clients can be limited to responsibilities of those they formerly protected.

3. Cannot Be a Legal Entity

A trust involves the trustee, the property, and the beneficiary. Trustees and beneficiaries are legal persons who are capable of retaining respective legal counsels. However, since the owned property is not a legal being, neither trustees nor beneficiaries can represent “the trust” as an entity, and both parties must respect the other’s interests. Contact Law Offices of Joel Harris for further explanation of this limitation.

4. Cannot Show Biases

A bias should not be present in an attorney’s representation of a client. If a lawyer’s conduct in a case is tainted in any way, it can become next to impossible for the lawyer to properly represent the client. Discussions involving biases can limit a lawyer’s ability to represent the client and must be avoided. Finally, no sexual relations with clients are allowed because it is a breach of privacy and an extreme case of bias.

5. Cannot Have Any Conflicts of Interest

In the case of conflict of interest, this means that attorneys cannot represent multiple clients without the consent of each party. It is the attorney’s responsibility to get the consent of their clients while disclosing any possible conflicts. There is no excuse for conflict of interest even if the client matters are unrelated. An attorney must not represent two parties in a dispute and is bound by the American Bar Association rules to avoid even the appearance of conflict.  Rule 1.1 and 1.3 state that representation is prohibited if the terms lead to the lawyer being unable to properly represent their client.

Are You Worried about Your Estate Plan?

If you are not properly prepared and with a well-planned will, then your family could be vulnerable to higher tax bills, extensive legal fees, and familial conflicts. To avoid those obstacles you should visit an Estate Planning Attorney to get professional help, and create a plan that well suits your goals.

At The Law Offices of Joel A Harris , with locations in the cities of Concord, Walnut Creek, Antioch, California, we have worked for over 25 years giving the best guidance our clients need to protect their assets. Have a question about your planning your estate? Feel free to schedule a sit-down meeting where we are happy to patiently answer every question you may have. For your free consultation reach out to us at (925) 757-4605.

Sources

4 Common Mistakes People Make AFTER Signing Their Living Trust

Posted on by khateam

Every estate plan has unique features, but after preparing living trusts and wills for the nearly thirty years, we have seen the same problems and mistakes often reoccur. Each of these common mistakes is avoidable as long as you take the care to make sure you been address them correctly. From wills to trusts and beyond, protect your loved ones by avoiding these four costly and common estate-planning mistakes.

1. Neglecting to Update Your Estate Plan

Many people become passive in the presence of an estate planning attorney. They rely on the attorney to make sure everything in the plan is what they need and is done properly. Part of the estate planner’s job is to be sure you understand the basics of how the plan works, what you need to do to implement or maintain the plan, and how it works for you and your beneficiaries. It is not your job to know all the legal angles and why certain language is used.

Often people make decisions after a discussion with their estate attorney but then later on details become hazy. Insist that your attorney simply explain your documents. You may wish to take notes about key decisions and why you made them. Each time the law or your family changes, you need to make it a part of your check-list to revisit your estate plan. These changes may require alterations in both new and old estate plans.

2. Not Updating Powers of Attorney

Every estate plan should include powers of attorney. You need at least two, one for financial matters and one for medical care, often called an Advance Heath Care Directive in California. Unfortunately, many people don’t have either of these documents, and others haven’t kept them up to date or given the details much thought.  Be sure you have these completed these documents and that they have been reviewed recently. Your financial power of attorney agents normally mimic your Executors and Successor Trustees.

3. Not Updating Beneficiary Designations

Failure to update beneficiary designations means an asset might go to your parents, siblings, or even an ex-spouse because of what the original form states. Your asset may be designated to a deceased person, or other unintended beneficiaries – we’ve seen it all. Other times someone is inadvertently excluded because they were born or married into the family after you completed the form. Review your beneficiary designations every couple of years and after every major life change in your family.

4. Not Updating Asset Ownership

You might own some assets in your own name and others in joint title with your spouse, adult child, or someone else. Some assets might be in your trust, limited partnerships, or other vehicles. When you have a living trust, the trust only protects assets that it owns. Normally all real estate, partnerships, brokerage accounts, stocks, bonds, mutual funds, notes, bank accounts and personal property will be owned by your trust. Life insurance policies will name your trust as beneficiary (except for special policies created to pay estate taxes). IRA, 401K and similar tax deferred retirement accounts cannot be owned by the trust – it is critical to name the right beneficiary on these accounts.

The Tax Cuts and Jobs Act made significant changes in income and estate taxes. If you have a trust or established estate plan created before 2012, you should have them reviewed to see if they are obsolete, or add unnecessary costs and complexity. To help your beneficiaries avoid unnecessary stress, ensure that you are distributing the right assets to the right people. You would be surprised what we find in old estate plans!

Are You Worried about Your Estate Plan?

If you are not properly prepared and with a well-planned will, then your family could be vulnerable to higher tax bills, extensive legal fees, and familial conflicts. To avoid those obstacles you should visit an Estate Planning Attorney to get professional help, and create a plan that well suits your goals.

At The Law Offices of Joel A Harris located in Antioch, California (here is a convenient map), we have worked for over 25 years giving the best guidance our clients need to protect their assets. Have a question about your planning your estate? Feel free to schedule a sit-down meeting where we are happy to patiently answer every question you may have. For your free consultation reach out to us at (925) 757-4605.

Sources

Estate Planning Mistakes Of The Rich & Famous You Can Learn From

Posted on by khateam

Everyone knows there are two things in this life that you can be sure of – Death and Taxes – even if you are a rich and famous celebrity. Over the nearly 30 years of being in practice I have witnessed countless horror stories of families fighting over the estate of the deceased, people stuck with millions due in taxes, and loved ones being left out of the will or trust. Many of the rich and famous – the most recent of which being Aretha Franklin – have had their estate planning failures go public.  This gives us an opportunity to learn from their mistakes. In this article we’ll look at the cases of some famous people who have had their outdated wills and improper estate planning become public so we can learn from their mistakes.

Is Your Will Outdated? Paul Walker’s Story

It is advisable to update one’s wills and trusts after every major life changing event. This means revising your will after things such as divorces or marriages, the birth of a child, or an accumulation of a large sum of money. As we learned from Paul Walker’s passing, an outdated will can have a massive effect on your family. Paul Walker, star of “The Fast and the Furious” movie franchise, made his will in 2001, the same year the first “Fast and the Furious” movie debuted. He died in 2014 in a tragic car crash, and a lot of things had changed in his life since the writing of his will. Because his will was not up-to-date, his teenage daughter was left out. If he would have kept his will up to date, then he would have had a chance to leave some of his estate to his daughter without the legal complications and fees she and her family experienced.

Has Your Estate Planning Been Properly Done? Lesson from James Gandolfini

Proper estate planning can save you and your family  money and stress. Unfortunately James Gandolfini, known for his role in “The Sopranos” was not as thorough with his estate planning as he could have been. Gandolfini’s will provided for his wife, daughter, and two sisters. However, he did not plan for taxes properly. Gandolfini’s estate ended up having to pay both federal and state estate taxes at 55%.  Another well known celebrity suffered from the same mistakes. Academy Award Winning actor Philip Seymour Hoffman was adamant about not turning his children into “Trust-Fund Kids”. Because of that, he ended up leaving everything to his children’s mother without any tax planning. By doing this his estate was subject to a massive estate tax bill. If he were to have met with an estate planning attorney, they would have found a way to achieve both his goal of not having “Trust-Fund Kids” and not losing so much money unnecessarily to taxes. If you want to familiarize yourself with estate taxes and need help planning your will and trust, visit The Law Offices of Joel A Harris for help. You’ll find all the resources you need to plan for the future.

Not Having a Will Can Cost a Lot – The Stories of Prince and Aretha Franklin

If you were to die without having a will you will have died “intestate,” which means the state will dictate how your assets will be distributed.  Sounds like a nightmare, right? Both Aretha Franklin and Prince, the singer most known for “Purple Rain” died without a will. In Prince’s case he did not have any known children so there were no obvious heirs to his estate. 45 people had tried to claim some part of his estate by saying they are his proper heirs! For the state to find rightful heirs and then divide his estate cost Prince’s estate a huge amount of legal fees.  In Aretha Franklin’s case, as of this writing five different people have filed papers with the court listing themselves as “interested parties” wishing access to her estate. The question of what happens to her sizable estate remains murky.

Are You Worried about Your Estate After Your Passing?

If you are not properly prepared with a well-planned living trust, then your family could be vulnerable to higher tax bills, extensive legal fees, and familial conflicts. To avoid those obstacles you should visit an Estate Planning Attorney to get professional help, and create a plan that well suits your goals.

At The Law Offices of Joel A Harris located in Antioch, California, we have worked for over 25 years giving the best guidance our clients need to protect their assets. Have a question about your planning your estate? Feel free to schedule a sit-down meeting where we are happy to patiently answer every question you may have. For your free consultation reach out to us at (925) 757-4605.

Sources

How to Spot and Stop Financial Abuse of Elders

Posted on by khateam

A 2016 seniors study found that the average loss to elder financial abuse victims was $36,000. Financial exploitation of seniors has grown significantly over the past decade, spreading further and creating more and more financial adversity. This disastrous financial exploitation can be spotted and stopped if one can recognize the fraud and take steps to protect yourself and your loved ones. The effects of financial exploitation can be debilitating leading to a loss of trust in others, loss of security, depression, fear, inability to provide for long-term care needs, and even loss of primary residence.

Who is Susceptible?

Elder financial abuse is a crime that deprives older adults of their resources and ultimately their independence. Older Americans that may have disabilities or rely on others for help can be susceptible to scams and other fraud. These abuse cases are notoriously difficult to prosecute. In many instances, it may seem as though the senior is willingly (and knowingly) giving their assets away. One immediate red flag is when an older person who was previously engaged and sharp begins to demonstrate a significant lack of recall about important matters. It is important to understand how vulnerable your elderly loved one may be to abuse tactics such as trickery, intimidation, or coercion.

Common Types of Fraud

Scams affect every part of life. The most common types of fraud fall under these categories: banking, bankruptcy, health, housing and mortgage, immigration, telemarketing, telephone, and direct mail marketing. The most popular scams include advance fee scams, chain letters, charity scams, IRS-related scams, Health product scams and tech support scams. With an immense collection of types of scams and frauds, it may be hard to figure out where to report each type. Unfortunately, scams are not limited to people you don’t know. Most of these egregious crimes are unreported and many of the them are committed by family members.

“The effects of financial exploitation can be debilitating with the individual frequently experiencing loss of trust in others, loss of security, depression, fear, inability to provide long term care needs, and loss of primary residence.”

Red Flags

Situations of financial exploitation commonly involve trusted persons in the life of the vulnerable adult such as caretakers, family members, neighbors, and even attorneys. Unfortunately, they look to gain power of attorney or conservatorship and abuse those powers. What are some of the red flags? Some signs include using conservatorship authority to transfer property for the conservator’s benefit, taking advantage of joint bank accounts, using or borrowing property without court authorization, refusing to obtain needed care and medical services for the victim in order to keep the person’s assets available for the abuser, and making unexplained decisions that are not in the best interest of the protected individual. The best approach for this kind of abuse is granting more than one person in a family the power of attorney. Visit an elder law specialist like The Law Offices of Joel A Harris for help. If you don’t have someone you absolutely trust, such as a spouse or child, you should consider co-agents in their power of attorney.

Stopping The Abuse

Interventions to address the financial abuse include closing joint bank accounts, having the victim revoke the power of attorney, and putting in a place a responsible person, a private fiduciary, or bank to assist with managing the victim’s funds. Other effective methods of addressing the financial abuse include working through multi-disciplinary teams which include law enforcement and working closely with banks to recognize, report, and investigate financial abuse.

“One in nine seniors reported being abused, neglected or exploited in the past twelve months.”

One in nine seniors reported being abused, neglected or exploited in the past twelve months. The effects of financial exploitation can be debilitating with the individual frequently experiencing loss of trust in others, loss of security, depression, fear, inability to provide long term care needs, and loss of primary residence. If you notice any of the red flags mentioned, you need to take action to mitigate financial loss and even prevent it entirely. Bennet Blum, MD and a leader in the field, developed an effective model for gauging how susceptible someone may be to undue influence. His “IDEAL” model assess the factors: Isolation, Dependency, Emotional manipulation, Acquiescence, and Loss. The IDEAL model is an important approach to safeguarding clients from those who perpetrate elder abuse.

Report the abuse – contact the appropriate financial institutions based on the type of fraud to prevent unauthorized transactions. If the report is towards a close relative of the elder, confront the perpetrator and get the proper authorities involved. Theft should be reported to law enforcement officials, and Adult Protective Services in your state or your local police can help. You can also make reports to the Federal Trade Commission for more of the common scams and fraud. Engage an aging life care professional or geriatric care manager who can offer support, guidance, access to resources, and compassion. Choose your trusted advisors wisely and be sure to conduct due diligence for anyone who is counseling, or caring for, your elderly loved one. Lastly, confirm that your loved one’s accounts are protected by the appropriate safeguards so that their personal and financial information stays secure. Equifax, one of the three major credit reporting agencies in the U.S., offers a free credit monitoring service, TrustedIDPremier. With that you are able to monitor and report any suspicious activity on your credit report. Remember, never give your social security number, account numbers or personal financial information over the phone unless you initiated the call.

“Choose your trusted advisors wisely and be sure to conduct due diligence for anyone who is counseling, or caring for, your elderly loved one.”

Are You Worried about Your Assets After Your Passing?

If you are not properly protected you and your loved one’s life savings could be taken away through innumerable and intricate scams. Avoiding and putting a stop to elder abuse also requires planning for your future and protecting your assets. At The Law Offices of Joel A Harris located in Antioch, California, we have worked for over 25 years giving the best guidance our clients need to protect their assets. Have a question? Feel free to schedule a sit-down meeting where we are happy to patiently answer every question you may have. For your free consultation feel free to reach out to us at (925) 757-4605.

Sources

Top 3 Things to Know to Protect You From A Medi-Cal Estate Claim

Posted on by khateam

Medi-Cal offers low-cost or free health insurance and nursing home coverage to eligible California residents with limited income. Before January 1, 2017, the federal law made it optional for states to recover for medical services like doctor visits and hospital stays. California is among 10 states that seeks repayment beyond the federal minimum and here your estate will be expected to pay back the value of all coverage you receive after you turn 55. Assets transferred to a surviving spouse could be sought for recovery from that spouse’s estate after his or her death. With new legislation, a Medi-Cal homeowner need only avoid probate to protect his or her estate from recovery, such as by having the home owned by a living trust.

Are You Asking Yourself “Can Medi-Cal Take My Home After I Die?”

  • Learning the New Law

Through the Estate Recovery Program, the Medi-Cal program sought repayment from the estates of deceased family members.  The program targeted only benefits received by the deceased on or after their 55th birthday as well as  their assets at the time of death. For those who passed away on or after January 1, 2017, Medi-Cal Estate Recovery may not apply if your estate is planned correctly. California passed SB 833 that included changes to the Medi-Cal estate recovery practices and more changes to the state health care laws. California no longer seeks recovery from the estate of a surviving spouse of a deceased Medi-Cal recipient.  The estate and assets which pass through a trust, or which avoid probate, are protected under SB 833. By placing assets into a living trust, and through proper estate planning, estate recovery can be avoided. Thinking you might need help? The Law Offices of Joel A Harris, located in Antioch, California are experts in Estate Planning and Probate Law.

  • Changing the Way You Gift Money

Under the new recovery rules, if a gift deed transfers the home outright to an individual and you retain a life estate, this would be considered irrevocable and immune from recovery. The state cannot recover from IRAs, work-related pension funds or life insurance policies. You should usually not name your living trust as the beneficiary on retirement accounts. Always directly name the person(s) you would like to be  the beneficiary. Repayment will be limited to only estate assets subject to probate that were owned by the deceased recipient at the time of death and repayments will be limited to services received by deceased.

Gifting assets can cost you if you don’t understand the rules. Changes to the Medi-Cal eligibility rules now uses a 30 month “look-back” rule when evaluating applicants. Transfers made for less than fair market value will cause a penalty period of disqualification determined by dividing the uncompensated transfer by the average monthly cost of LTC private pay in your area. By gifting, an individual can transfer property at the time of death with the gift tax effects considered.

  • Helping Your Children

Even though the state can no longer recover for basic health services like doctor visits and prescription drugs, it can recover for services related to nursing home care. Recovery is limited to services required to be recovered under federal laws. Probate is a legal process through which the corresponding county court sees that the deceased’s assets are distributed according to the decedent’s will. The probate process can be thought of as simply the last option for transferring titles to the beneficiary. Avoiding probate can save unnecessary expenses, time, and stress.

Are You Worried Your Assets May Not Be Protected From A Medi-Cal Estate Claim?

Planning for your future includes understanding that all that you have worked and saved for could be taken away after your passing if not properly protected.  Preparing for that time by protecting your assets is the best gift you can give your spouse and children. At The Law Offices of Joel A Harris, we offer the best guidance for preparing your estate plan catered to your individual needs. Throughout the process, we explain everything and patiently answer every question you may have. Since 1993, The Law Offices of Joel A Harris, located in Antioch, California, has worked tirelessly to assure individuals create the most beneficial estate plan for their spouse and heirs. Have questions, feel free to reach out to us at (925)757-4605.

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California May Soon Require Employers To Offer Retirement Benefits To Their Private-Sector Employees

Posted on by khateam

By Special Guest Nick Gizzarelli, CPFA, QPA, QKA

The Golden State has finalized regulations for the implementation of a state-run automatic Roth IRA plan, becoming the third state to create an auto-IRA program for the private-sector.

Recently renamed CalSavers (formerly California Secure Choice), this program will require employers with five or more workers to either offer an employer-sponsored retirement plan or enroll their staff in the state-run program. Scheduled to take effect by the end of 2018, CalSavers will grant 12 months for businesses with 100 or more employees to comply, and will gradually phase in smaller businesses over the subsequent two years.

“Regardless of socioeconomic status, the hard-working people of California who have made our state a global economic powerhouse deserve a measure of financial security in their golden years,” said Senate President Pro Tem Kevin de León, who authored the legislation designed to introduce a retirement savings program to the 7.5 million Californians not covered by an employer-sponsored plan.

The Role of the Employer

As written, the regulation will require employers with at least five employees and who do not offer an employer-sponsored plan to setup automatic IRA payroll deductions for both part-time and full-time employees within 30 days. Only employees working in California will be eligible for the program. Employers must determine if and when CalSavers will impact their business and register with the state by the deadline. For employers wanting to opt-out of the state-run program, they will want to adopt an employer-sponsored retirement plan before the same deadline.

Employers will be responsible for identifying eligible employees, distributing required notices, setting up automatic payroll deductions, and transmitting the funds to CalSavers. Penalties and fees will apply for failure to enroll eligible workers or properly execute the employer’s administrative duties.

Because CalSavers is a state-run Roth IRA program, some employees may not be eligible to contribute as eligibility to participate in a Roth IRA is based on an individual’s adjusted gross income. It is unclear whether the employer or individual will be responsible for determining whether or not the worker is eligible to participate in a Roth IRA.

The plan will not allow the employer to make discretionary or employer matching contributions. Only employee IRA deductions will be allowed.

Who Pays for the Plan?

CalSavers is intended to be self-sustained, funded by fees deducted from employee account balances. California will not impose any direct fees to the employer during or after registration, however third party vendors, such as banks or payroll companies may impose fees to setup the deductions and funds transfer to the state.

When determining the financial impact on a business, the employer should carefully consider how to allocate internal resources to comply with the new regulation. While technically not considered an employer-sponsored plan, the employer will still be responsible for many of the ministerial functions related to enrollment, contributions, and employee communications. Failure to fulfill these duties may result in penalties or fees to the business.

No Qualified Plan, No Federal Tax Credit

Because CalSavers is not an employer-sponsored plan, the employer will not be eligible for the retirement plans startup costs tax credit, which reimburses employers for a portion of the costs related to implementing a new retirement plan. Currently, employers who setup a new employer-sponsored plan are eligible to receive tax credits of up to $1,500 to offset implementation and administrative fees.

Employers Have Options

California has started the countdown for businesses who do not yet offer retirement benefits for their staff. Employers scrambling to meet this deadline, should carefully research all available retirement options. Undoubtedly, more details about CalSavers will become available as we near the expected rollout date.

Keep informed by visiting www.treasurer.ca.gov/scib/ or by contacting Nick Gizzarelli at nick@thomasdoll.com.

Nick Gizzarelli-California May Soon Require Employers To Offer Retirement Benefits To Their Private-Sector EmployeesAbout Nick Gizzarelli, CPFA, QPA, QKA

Nick Gizzarelli is a Retirement Plan Specialist at Thomas Doll, an employer-sponsored retirement provider located in Walnut Creek, CA. Nick and his team have worked for over three decades to bring Fortune 100 level retirement plan services to the small- and mid-employer space. Nick is a current member of the American Retirement Association and National Association of Plan Advisors, as well as former member of the National Institute of Pension Administrators.

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