tag:blogger.com,1999:blog-40517740453635666952024-03-13T02:16:49.793-05:00Alabama Estate Planning BlogThis blog is meant to provide the public with useful legal information. I must note that this blog is not intended to provide legal advice, nor is it intended to form an attorney-client relationship with any party. If you have specific questions about how the law affects you, please consult with an attorney.Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.comBlogger65125tag:blogger.com,1999:blog-4051774045363566695.post-71578193860217894852012-08-10T19:35:00.003-05:002012-08-10T19:35:42.950-05:00Distribution of Personal PropertyI came across a very touching post about the distribution of personal property from an estate. I really liked reading the Echoes of a Life <a href="http://susansoundings.wordpress.com/2012/07/31/the-echoes-of-a-life-2/">http://susansoundings.wordpress.com/2012/07/31/the-echoes-of-a-life-2/</a><br />Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-29948049514400460822011-12-11T05:08:00.002-06:002011-12-11T05:10:31.013-06:00New Year, New LawThe turn of the calendar year signifies a lot of change in society. The first of the year also brings with it many new laws going into effect on January 1. Alabama has adopted a new Power of Attorney Act, which will apply to all powers of attorney executed on or after January 1, 2012. Some significant changes include:<br /><br />1. <strong>Powers of Attorney are Presumed “Durable”</strong><br /><br />Under prior law any authority granted under a power of attorney would immediately terminate upon the incapacity of the principal. In order to allow a power of attorney to survive incapacity, the document had to state it was “durable” and would survive any incapacity. The new Act changes the presumption and all powers of attorney will be durable unless the document states otherwise.<br /><br />2. <strong>Authority of Co-Agents</strong><br /><br />A person has the ability to name more than one person to serve as agent at any one time. There may be times when it is appropriate to have two individuals serving as agents. Section 26-1A-111 creates a presumption that where two or more agents are named to serve at the same time, they can each act individually without consulting the other. If you want your agents to work together and be in agreement before any decision is made, then you would need to explicitly state that the power is joint and not joint and several.<br /><br />3. <strong>Appointment of Successor Agents</strong><br /><br />Section 26-1A-111(b) allows a principal to allow someone (including an appointed agent) to name one or more additional successor agents at a later time. This provision can be effective in cases of long-term incapacity, where the principal may “run out” of agents as time passes.<br /><br />4. <strong>Enforcement of Documents</strong><br /><br />One of the most significant provisions of the new Act regards an individual’s or institution’s obligation to accept a power of attorney (see 26-1A-120). Under prior law, if you presented a power of attorney to a bank, it may refuse to honor it and you would have no legal recourse. The new law states that if a bank (or any party) has a question about a power of attorney, it can request a verification or opinion of legal counsel within a reasonable time. Once the verification is received, it must honor the power of attorney within a reasonable time or else it may be liable for damages.<br /><br />The new law further prohibits an institution from requesting a new form or that the principal use the institution’s power of attorney. However, if an institution has a good faith reason to believe that the power of attorney is not valid, then they would not be liable for damages.<br /><br />5. <strong>Specific Grants of Power</strong><br /><br />There are many times an agent will want to use a power of attorney to change a principal’s estate plan or general structure of financial assets. The new Act (26-1A-201) provides that if an agent wants to exercise any of the following powers, then the document must expressly grant those rights:<br /><br />a. Create, amend, revoke, or terminate a trust<br />b. Create or change rights of survivorship<br />c. Create or change beneficiary designations<br />d. Delegate authority granted under the power of attorney to others<br />e. Waive the principal’s right to be a beneficiary of a joint and survivor annuity, including a survivor benefit under a retirement plan.<br />f. Exercise fiduciary powers that the principal has authority to delegate<br /><br />6. <strong>Gifts</strong><br /><br />There are several restrictions on an agent making gifts of a principal’s property (which is not a bad idea). For example, you cannot give yourself any portion of the principal’s property unless you are related to them by blood or marriage. An agent must be careful about making any gifts, but should take particular caution when the agent itself will benefit. If the gift is not something the principal would have done if he or she were able, then the agent may be liable for a breach of fiduciary duty.<br /><br />Further, section 26-1A-217 states that unless otherwise stated, any gift to an individual shall not exceed the annual gift tax exclusion (currently $13,000). There may be situations where an agent needs to make a gift exceeding $13,000, but the document itself would have to allow such flexibility.<br /><br /><br />The new Act greatly enhances the effectiveness of a power of attorney, which can be advantageous if you find yourself handling the financial affairs of a loved one. The Act only applies to powers of attorney executed on or after January 1, 2012, so in order to achieve maximum effectiveness for your document, you may want to add executing a new power of attorney to your New Year’s resolutions.Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com1tag:blogger.com,1999:blog-4051774045363566695.post-76351204565386534462011-10-19T19:57:00.002-05:002011-10-19T19:59:52.765-05:00The Definition of Estate Planning<div align="justify">I heard a quote today from the book <em>Loving Trust</em>, which I feel is the best description I have heard of estate planning:</div><br /><div align="justify"><br />"I want to provide for myself and my loved ones during my lifetime, and, upon my incapacity or death, give what I have to who I want, the way I want, when I want, and, if I can, save every last fee, tax or court cost whenever possible."</div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-37667781325402643482010-12-31T09:30:00.002-06:002010-12-31T09:41:40.174-06:00New Year - New Resolutions<div align="justify">I always enjoy the turn of the year. It is not only a time to reflect on the past, but also an opportunity to think about the future. Many people enter the new year with one or more "resolutions," most often involving some type of weight-loss program. I want to offer an easier and more significant resolution for your consideration (easier and more important-how can you argue with that?).</div><div align="justify"></div><div align="justify"><br />I recommend that you take the new year to ensure that your financial and legal house is in order. All too often financial and legal matters are not addressed until there is an emergency or a real need and by that time, it is too late to adequately address these matters. You may want to consider addressing them now, so that if a need ever arises, you and your family are protected. </div><div align="justify"></div><div align="justify"><br />The following is an example of some steps you can address this year:</div><div align="justify"></div><div align="justify"><br /><strong>Seven Steps to Protect Your Family</strong></div><div align="justify"></div><div align="justify"><br />Action Item </div><div align="justify"><br />1. Sign a Will and/or Trust to direct the disposition of property at death </div><div align="justify"><br />2. Obtain a Durable Power of Attorney<br /></div><div align="justify"><br />3. Obtain an Advance Health Care Directive<br /></div><div align="justify"><br />4. Document Funeral/ Burial Wishes<br /><br />5. Create a Personal Record Book, containing such items as a list of assets, document locations and emergency contacts<br /><br />6. Conduct a long-term care and life insurance assessment: either a self-assessment or speak with an insurance professional.<br /><br />7. Leave a lasting personal legacy for your friends and family, e.g., a letter or ethical will </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-47213940695425730082010-12-22T08:39:00.002-06:002010-12-22T08:42:56.601-06:00A Christmas Gift from Congress<p align="justify">The status of the Federal Estate Tax (affectionately known to some as the “Death Tax”) has been in a state of uncertainty for the last several years. In 2009 the tax existed and included an exempt amount of $3.5 million, meaning if the total value of your estate was less than the tax exempt amount, you did not have to be concerned with the tax. On January 1, 2010 the estate tax was repealed and we have operated for an entire year without an estate tax. On January 1, 2011 the tax was scheduled to return to its 2001 levels, which would include an exempt amount of only $1 million.<br /><br />Congress and the President prevented a return to the 2001 estate tax levels when the President signed new tax legislation on December 17, 2010. This law provides very generous provisions for taxpayers in relation to the estate tax and removes the applicability of the tax for most individuals. Some highlights include:<br /></p><p align="justify"> -<span style="color:#3366ff;">The tax exempt amount is now $5 million per individual. This means that together a couple can pass $10 million to their beneficiaries without paying an estate tax.<br /></span></p><p align="justify"><span style="color:#3366ff;"> -Where there will be an estate tax, the maximum rate is 35%.<br /></span></p><p align="justify"> <span style="color:#3366ff;"> -The tax exempt amount is now “portable.” Meaning, if a spouse dies and does not use all of his or her exemption, the surviving spouse can claim the remainder. Under the old law, a couple would need to use tax-free or credit shelter trusts as a part of their estate plans in order to take advantage of both tax-exempt amounts.<br /><br /></span><span style="color:#3366ff;"> -The Estate Tax and the Gift Tax are once again “unified,” meaning the exemption amounts are the same. Even when the tax-exempt amount was $3.5 million, the exempt amount for lifetime gifts was capped at $1 million. The exempt amount for lifetime giving is now $5 million.</span><br /><br />This new law provides an incredible benefit for families. One should note that these new provisions are set to expire in two years, so either Congress will make these changes permanent or we will be facing the same situation again in December 2012. In the meantime, it looks like we will have a very happy new year (at least from a tax perspective).</p>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-54351586331184333782010-11-26T15:38:00.002-06:002010-11-26T15:40:58.654-06:00Happy Thanksgiving<div align="justify">The following text is from my bi-weekly newsletter. I thought it was important enough to share here. If you are interested in signing-up for the newsletter, you can do so at www.jackcarneylaw.com.<br /><br />Many of us are spending the long holiday weekend with family and loved ones. We all take the time to travel, cook, shop and even pass through airport security scanners because we love our families and we want to spend time with them. Even though we would do a lot for our families, there are some issues we usually try to avoid, like discussing estate and elder care planning.<br /><br />The Thanksgiving holiday provides a wonderful opportunity to reconnect with family members and ascertain their situation. When children visit parents, they may notice stacks of unpaid bills, an empty refrigerator, dents in the car, or other signs that their parents need some help. These clues may also indicate a need for some elder care planning. If a parent becomes unable to handle his or her affairs, a Durable Power of Attorney is a more cost-effective tool than a court created guardianship or conservatorship.<br /><br />Children are not the only ones that may want to ask questions this holiday season. If a young couple has children and they do not have a Will, then they are not doing everything necessary to protect their minor children (such as naming a legal guardian and establishing a trust to protect financial assets). Grandparents have a unique opportunity to initiate these discussions to ensure that their grandchildren will be well protected.<br /><br />Showing true love for our family often involves addressing uncomfortable issues. Ensuring that our family is legally protected in the event of death or disability is one of the best gifts we can give.<br /><br />On that happy note, have a wonderful holiday season! </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-67654689361296714352010-11-21T19:14:00.002-06:002010-11-21T19:20:14.827-06:00An Alternative to Litigation<div align="justify">The Better Business Bureau (BBB) is an excellent resource for individuals who have a complaint with a business. The BBB can be a viable <span class="blsp-spelling-error" id="SPELLING_ERROR_0">alternative</span> to litigation when it comes to complaints against the services of a business (I must admit I have used it myself). Before considering seeking legal action to address a complaint, you may want to first consider whether the BBB can provide a solution. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-20395815467558016442010-09-15T22:42:00.001-05:002010-10-06T22:52:04.650-05:00Unintended Consequences<div align="justify">I recently attended a hearing in divorce court. While I was waiting for the Judge to call my case, I had the opportunity to listen to an argument about the division of home between a husband and wife. Typically, the marital residence of a couple is subject to an equitable division. The twist in this particular case was that the home was a gift from the wife's mother. Furthermore, the mother continued to live in the home. The wife's argument was that her mother intended for the home to remain in the family.</div><div align="justify"></div><div align="justify"><br />This situation provided a real-life example of the risks of making lifetime transfers of property. I am often asked by clients whether parents should transfer their homes to one or more of their children. The typical reason for these transfers is to "protect" the home from Medicaid should the parents ever require long-term medical care. Such a transfer may be legally and morally questionable. Nevertheless, there is a real practical risk in that the parents are no longer the owners and the home could be subject to the claims of the children's creditors (such as a divorcing spouse). I would not want to live in a home that is owned by someone else because my rights to remain in the home are not guaranteed. I fear many parents do not appreciate this risk when making these transfers. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-76057417191376562010-08-31T23:06:00.002-05:002010-08-31T23:11:29.980-05:00Updating your Will<div align="justify">It is always important to ensure that your Last Will and Testament is updated in order to reflect your current wishes. If you executed a Will in Alabama prior to 1983, it is even more important to update your Will immediately (even if you have no substantial changes). In 1983, the Alabama Legislature approved the use of a self-proving affidavit, which is a document almost all lawyers utilize today. This affidavit prohibits the need for a witness to later testify to the authenticity of a Will. If there is a self proving affidavit, which basically is the addition of a notary public to the Will, then the Will is deemed valid for purposes of probate. You can imagine that it can be quite difficult and costly to track down a witness to a Will, especially if it was prior to 1983!</div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-72485721862866126022010-07-17T21:31:00.001-05:002010-07-17T21:33:07.675-05:00Death and Dying<div align="justify">As an estate planner, I frequently have to discuss the topics of death and disability. These topics can be extremely uncomfortable for people (and on top of that I ask people to pay me for the privilege of this discussion). I recently learned a good lesson from my four year old about the fear of dying.<br />First, just a few days ago (and totally out of the blue), she told me “Daddy, I don’t want you to get killed.” I replied “me neither” and we had no more to say about that topic.<br /><br />Just a few days later, Grace told me that she had to tell me something. She put her hands on my cheeks and said “Daddy, I love you. Will you promise something? When you die and are in heaven, you watch me, ok. I will be old when I get there, but when I get there we can love each other forever and ever, ok?“<br /><br />I was of course a little surprised and had an immediate dread that something was coming for me and this was my omen. She then made me laugh when she said, “write it down ok, so you don’t forget.”<br /><br />After some reflection I learned a lesson from Grace. She is too young to harbor all the fears and concerns our society has about death. Perhaps it is something (especially those of us who are Christians) should feel comfortable discussing and perhaps we should even embrace it. By the way, Grace, I will watch you. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-43332769215177502602010-07-04T21:41:00.004-05:002010-07-04T21:46:50.734-05:00Do I Need These Long Documents?<div align="justify">Some of the most frequent questions I receive from clients involve the length of my legal documents. These include: Why is my document so long? I do not understand all these fancy legal words, can you take them out? Do you charge by the word?</div><div align="justify"><br />I can understand a client’s frustration, in particular when other Wills they may have seen consisted of one or two pages and were quite “straightforward.” I have reviewed many of these very simple Wills and although many are not legally wrong, they approach the concept of estate planning from a different school of thought.<br /><br />My documents are relatively straightforward too, but I include a lot of additional provisions that are designed to make the administration of the estate or trust as efficient as possible. In reality, we may only use 10% of the language in one of my documents to administer an estate. The other 90% is there to address circumstances or unique situations that may arise in the future. </div><div align="justify"></div><div align="justify"><br />For example, I include a provision stating that if a remote beneficiary is under age 21, then any assets passing to that beneficiary will be held in trust. The plan does not initially anticipate that assets will pass to one of these remote beneficiaries, but because it could happen, it is prudent to address this eventuality. </div><div align="justify"><br />There is of course a rational limit to planning for eventualities. If an occurrence is really remote, then it may not be worth addressing in one’s documents. However, every family’s circumstances are different, and one of the benefits of working with an estate planner is that he or she can help a client identify any probable eventualities that warrant inclusion in the planning documents. Even though the length and complexity of documents may annoy or frustrate a client, if one of these eventualities should arise in one’s life and the document quickly and efficiently handles it, the client will be grateful it was there.</div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-71175025097766691622010-05-31T15:56:00.003-05:002010-05-31T16:01:09.423-05:00Happy Memorial Day<div align="justify">I want to wish all service men and women (past and present) a happy Memorial Day. We are thinking about you and are keeping you and your families in our thoughts and prayers. I also do not want to forget about soldiers of a four-legged variety, such as those honored by the Alabama War Dog Memorial (please visit <a href="http://www.awdm.org/">http://www.awdm.org/</a>).<br /><br />I have had the opportunity to assist members of our armed services with their own estate planning. It is always an honor to be a part of that process and it is particularly somber to know that this client is willingly placing themselves in a position of harm. It makes the documents, such as a Will and Durable Power of Attorney, seem that much more important. </div><div align="justify"><br />Military deployment is also a time where many service members may consider utilizing an Ethical Will as a part of their estate plan. An ethical will is a writing wherein an individual shares his thoughts and feelings about his friends and family. It may also be an opportunity for a parent or grandparent to share words of wisdom for future generations.<br /><br />I recently read a touching story about a soldier in Iraq who kept a journal for his young son. Many of the entries mentioned the possibility of his death, which were made all the more poignant by the fact that this soldier was killed in action. It was an incredible tragedy, but at the same time this man left an amazing gift for his family. </div><div align="justify"><br /> </div><img id="BLOGGER_PHOTO_ID_5477541608486505426" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 277px; CURSOR: hand; HEIGHT: 320px; TEXT-ALIGN: center" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgnYr-AdfpQBPu-C-bICJVzCAPstrklp3L-n9CVjMY6nhemwJ-qI3a2s39U8HGg7AeRrIOFG8SgShBEnS8ED0YzzaQ2D7hmVirktNxJPU7Xoi7xH1-1OEwFPlWsptSt8jCga09S9dOt0Lt0/s320/MarineIraq.jpg" border="0" />Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-28912147054319918312010-05-29T15:54:00.000-05:002010-05-31T15:55:42.727-05:00An Unpleasant Thought<div align="justify">One of the most unpleasant questions I have an opportunity to raise in my planning meetings is the discussion of a family disaster. For purposes of estate planning, I personally define a “family disaster” as the death of all of the immediate beneficiaries in a plan. In the example of a married couple, it would be their death and the death of all of their lineal descendants. In many cases this is an unlikely event, but it does happen (often in the form of a small plane crash).<br /><br />Many people do not plan for this eventuality in their documents, but because it could happen, I feel it is important to address. For example, I am married and have two young children. We frequently travel together as a family and therefore there is a higher risk that my family will utilize our disaster clause, as opposed to a family with six children and twenty-two grandchildren.<br /><br />You have the opportunity to provide for a number of individuals and/or your church or favorite charity. One common option is to split the estate between the wife’s heirs at law and the husband’s heirs at law. “Heirs at law” may also be described as an individual’s next of kin.<br /><br />As the years go by, the family disaster issue will become less relevant, as in all likelihood, the family will grow and your children will have children, etc. thereby increasing the pool of potential beneficiaries. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-1560704898689135772010-05-27T15:49:00.000-05:002010-05-31T15:53:07.852-05:00Where Can I Find a Lawyer<div align="justify">Many people feel the world has too many lawyers (and they may be right). I recently spoke with someone who had not executed a Will only because they did not know where to find a lawyer to help them. You can find thousands of lawyers in the yellow pages and on the Internet, but you will spend a significant amount of time sorting through the masses in an attempt to find someone to fit your particular needs. Some lawyers are like doctors in that they specialize in a particular area of the law. I personally speak with several people a week who have pulled my name from the phone book, but I have to tell them that I do not accept the type of case that they are pursuing.</div><div align="justify"><br /></div><div align="justify">Seeking a referral can be the most efficient way to obtain legal counsel, for you will get a focused recommendation, designed to fit your needs. Here are some common examples of where you may go to seek a referral for legal counsel:<br /></div><div align="justify"></div><div align="justify"><br />Family<br />Friends<br />Your Attorney (if he or she does not handle your new need).<br />Local Bar Associations (many have referral programs)<br />Your CPA<br />Insurance Agent<br />Financial Planner<br />Your minister</div><div align="justify"></div><div align="justify"></div><div align="justify"><br />There are also many new social media resources that may allow you to find a lawyer to fit your needs, such as twitter, facebook or linkedin. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-2206150897183778392010-05-26T00:27:00.003-05:002010-05-26T00:34:05.072-05:00Summer Vacation Planning<div align="justify">We are approaching the Memorial Day weekend, which many consider to be the start of the summer travel season. If you are going to travel this summer and be apart from your children, you may want to consider signing a temporary guardian appointment, which would allow you to name someone to make personal and medical decisions for your children if you were unable to do so. My wife and I sign such a document whenever we leave our children for an extended period of time (thank God for grandparents, for no one else would take the kids for so long). Please consult your legal advisor if you are interested in obtaining this type of document. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-41160171820789362352010-04-10T12:11:00.001-05:002010-04-16T12:31:19.777-05:00A Religious Direction to Get a Will?<div align="justify">I was fascinated to learn that the Episcopal Church's Book of Common Prayer actually discusses estate planning and the importance of making a Will. On page 445 of the Book, the minister is directed to:<br /></div><div align="justify"></div><div align="justify"><em><br />Instruct the people, from time to time about the duty of Christian parents to make prudent provision for the well-being of their families.</em> </div><div align="justify"></div><div align="justify"><br />There is also a duty <em>of all persons to make wills, while they are in health, arranging for the disposal of their temporal goods [and] to leave bequests for religious and charitable uses</em>.</div><div align="justify"></div><div align="justify"><br />One does not have to be an adherent of the Book of Common Prayer to believe in and follow these directions. (In the interest of full disclosure, I am Catholic). They serve as a great reminder for everyone that we are all asked to be good stewards for our families. </div><br /><br /><br /><em></em>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-7553840929460093342010-01-24T03:25:00.004-06:002010-01-24T03:40:41.380-06:00Federal Estate Tax Update<div align="justify"><span style="color:#333333;">As many people know, Congress allowed the Federal Estate Tax (also known as the Death Tax) to lapse on January 1, 2010. We are currently operating without an estate tax. I can distinctly remember telling clients that Congress would never let the tax lapse, but that goes to show what I know about the reasonableness of our elected officials. </span></div><div align="justify"><span style="color:#333333;"></span></div><div align="justify"><br /><span style="color:#333333;">This situation has created a tremendous amount of uncertainty for estate planners, especially given that most expect the estate tax to <span class="blsp-spelling-error" id="SPELLING_ERROR_0">return</span> at <span class="blsp-spelling-error" id="SPELLING_ERROR_1">pre</span>-repeal limits and rates. The general consensus appears to be a wait and see approach. If a client has a documents that makes <span class="blsp-spelling-error" id="SPELLING_ERROR_2">dispositive</span> distributions based on the amount of the federal estate tax exemption, then they may want to analyze the effect repeal may have on their documents. For example, a document may say "I give the maximum amount that can pass free from federal estate taxes to __________." If this person were to die today, this amount is arguably the entire estate. </span></div><div align="justify"><span style="color:#333333;"></span></div><div align="justify"><br /><span style="color:#333333;">There is currently legislation that would "fix" this problem. The bill (2009 HR 4154) has been passed by the House and is currently in the Senate. This bill would establish the estate tax exemption at the 2009 level of $3.5 million with a maximum tax rate of 45%. You can review a copy of the actual bill <a href="http://www.govtrack.us/congress/bill.xpd?bill=h111-4154">here</a>.</span></div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-34104711119778059392009-12-26T12:57:00.003-06:002009-12-26T13:01:37.433-06:00Legal Guide for the Seriously Ill<div align="justify">The American Bar Association (in conjunction with several other organizations) recently published a free on-line guide addressing the legal issues related to a serious illness. This tool can be a good starting point for families addressing this type of situation. We are all going to deal with the issue of serious illness at some point in our lives. Oftentimes it is more efficient to address these issues and have a plan in place before a sudden illness strikes. </div><br />The guide is available at <a href="http://www.caringinfo.org/UserFiles/File/PDFs/AdvanceCarePlanningLegalIssues/Legal_Guide_for_Seriously_Ill.pdf" target="_blank">http://www.caringinfo.org/UserFiles/File/PDFs/AdvanceCarePlanningLegalIssues/Legal_Guide_for_Seriously_Ill.pdf</a>.Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-19823692427713422652009-12-25T13:01:00.000-06:002009-12-26T13:03:58.849-06:00Merry Christmas<div align="justify">I want to wish everyone a wonderful holiday season. I was fortunate enough to spend a great day with my family. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-60956974876445566702009-12-10T09:37:00.003-06:002009-12-10T09:48:40.324-06:00The Loss of Someone We Know<div align="justify">Death is such a common part of life. It is something that we will all have to cope with and even experience. As an estate planning attorney, it is certainly an event that I discuss on a daily basis. Nonetheless, when death occurs in our close personal circle of friends and family, it is always a shock.</div><div align="justify"></div><div align="justify"><br />I recently learned about the sudden death of an attorney colleague and friend. The news was shocking and sad. As always, it forces me to put my own life in perspective and face my own mortality. The only comfort that I have is that I can pray for my friend and her family. </div><div align="justify"></div><div align="justify"><br />I am also meeting with a client today to discuss a Will. She has been talking to me about preparing a Will for years. She admitted that the reason she finally made the appointment is that she learned of the sudden death of a close friend of hers. </div><div align="justify"></div><div align="justify"><br />I hope that I will always address the important issues in my life (such as keeping my own personal estate planning updated) on a regular basis without the impetus of a tragedy. Nonetheless, it is often those sudden tragedies that finally make us ignore the unimportant noise in our lives and focus on those things that matter most. Perhaps that is why we are asked to endure these types of tragedies in life. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-83411169796836532282009-11-22T20:35:00.001-06:002009-11-22T20:37:11.589-06:00New Office<div align="justify">I am pleased to announce that I have a new office located in the heart of Homewood. Our new address is 3410 Independence Drive, Birmingham, Alabama 35209. Please feel free to drop by for a visit!</div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-60233855754261687462009-08-21T06:16:00.002-05:002009-08-21T06:29:29.024-05:00Back to School<div align="justify">It's that time of year- students are returning to school. Many college and graduate school students may find themselves moving many miles away from home. It is important to consider some of the legal issues that may arise, especially with these potential long distances. </div><div align="justify"></div><div align="justify"><br />There are two documents that parents and students may find useful: a <strong>Durable Power of Attorney</strong> and an <strong>Advance Health Care Directive</strong>. A Durable Power of Attorney would allow students to appoint someone to make financial and business decisions for them if they are unable or unavailable to make them for themselves. There are times where a parent or family member "back home" may need to make decisions or sign paperwork on behalf of a student. A Power of Attorney would make this possible (and much easier). </div><div align="justify"></div><div align="justify"><br />An Advance Health Care Directive allows individuals to appoint someone to make health care decisions if they are unable to make them for themselves. Students may want to leave a copy of this document with their respective student health centers in order to clarify who would make day to day health care decisions for them.</div><div align="justify"></div><div align="justify"><br />Although many students would not have a need for these types of documents, it is a great (and simple) insurance policy in case the need should ever arise. </div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-77214807084802644792009-05-16T18:44:00.003-05:002009-05-16T19:08:02.471-05:00Estate Planning in a Digital Age<div align="justify">I recently read an article about estate planning for younger clients. One of the more interesting sections addressed the particular challenges of estate planning in a digital age. Many individuals have their own webpages, domain names, e-mail accounts, twitter accounts, etc. Even though these are not traditional "tangible" pieces of property, it is prudent to consider these items assets for estate planning purposes.</div><div align="justify"></div><div align="justify"><br />First, it is important for an individual to leave a list of usernames and passwords that would allow an agent under a Durable Power of Attorney or a Personal Representative under a Will to access these items. There are obvious security concerns with creating such a list, and it would probably be prudent to make an effort to safeguard this information. Where a client has a significant amount of "digital" property, it may even be advisable for any Will or Power of Attorney to include specific language referencing the power to manage and control digital assets.</div><div align="justify"></div><div align="justify"><br />Second, an individual may want to make specific reference to these properties in a Will to dispose upon it on death. Even though the Will may address this property, it will also be subject to the terms and provisions of any agreement with the e-mail or host provider. For example, I was curious about whether my twitter handle (@jackcarney) could survive my death and be left to ... well, probably another Jack Carney. Twitter's terms of service do not address this issue and it would probably be something my Personal Representative would need to resolve (assuming anyone thought my twitter handle was a valuable resource). I have not yet sold an item on Ebay, but if I did and should die before the end of the sale, my Personal Representative would be responsible for canceling or closing the sale, in addition to collecting any proceeds. At the very least, he or she would need access to my Ebay (and possibly Paypal) account.</div><div align="justify"></div><div align="justify"><br />There will likely be more significant developments regarding estate planning and digital property within the next several years, as these assets are becoming a more common part of everyday life.</div><div align="justify"></div><div align="justify"></div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-90347089448440033722009-05-01T07:01:00.002-05:002009-05-01T07:26:42.129-05:00The Bright Side of the Economy<div align="justify">The economic situation is adversely affecting a lot of people. However, there may be a bright side in the area of transfer tax planning. The federal estate and gift taxes are meant to tax the transfer of wealth from one generation to the next. The tax is based on the value of one's assets. As many of our assets (homes, stocks, properties) are at historically low values, this environment can be a perfect opportunity to transfer wealth at a low tax cost.</div><div align="justify"></div><div align="justify"><br />Now I am not telling anyone to die, but rather to consider making lifetime gifts of assets. Each individual can pass up to $13,000 to another individual without gift tax consequences (spouses can split a gift and give up to $26,000). In this environment, you can gift more shares of stock using the $13,000 umbrella than you could have three or four years ago. If the shares increase in value after the gift, then that appreciation will be out of the donor's taxable estate and will be included in the estate of the recipient.</div><div align="justify"></div><div align="justify"><br />Another aspect of this current environment is historically low interest rates. These interest rates can be important for certain wealth transfer vehicles (such as a Grantor Retained Annuity Trust or GRAT), but also for some simple transactions, such as intra-family loans. A family member loaning money to another may not want to charge an interest rate. However, the IRS has established a minimum rate that must be charged in order to avoid having the failure to charge interest treated as a gift. These minimum rates are currently low and therefore it may be an excellent time to explore these options.</div><div align="justify"></div><div align="justify"><br />As always, these words are not meant to apply to anyone's specific situation. If you have any questions or concerns, please consult your legal or tax advisor.</div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0tag:blogger.com,1999:blog-4051774045363566695.post-42439297665470649632009-04-13T08:35:00.002-05:002009-04-13T08:37:58.124-05:00Updates<div align="justify">I often receive questions about when to review estate planning documents (such as Wills, Powers of Attorney, etc.). Here are some general guidelines to follow:<br /></div><div align="justify"><br />-Consider personally reviewing your documents at least once a year to ensure they still conform with your wishes. You may wish to make it a yearly habit (at the start of a new year, your wedding anniversary, etc.) or you may wish to share copies with another advisor with whom you will meet with anyway every year (such as your CPA or Financial Planner).<br /></div><div align="justify"><br />-Consider a more formal review with your attorney every three to five years. You attorney would be able to review your current situation and determine whether your documents are still the most effective. Furthermore, you can discuss whether there have been any changes in the law that may warrant a change in your documents.</div><div align="justify"></div><div align="justify"><br />-Review your documents upon the occurrence of a life changing event, such as a death, marriage, divorce, etc. My general rule of thumb is that if you have to ask yourself if something is a life changing event, then it is probably a life changing event.</div><div align="justify"><br />A change in circumstance does not necessarily mean that you will have to change your legal documents. For example, the birth of a new child would most certainly constitute a life changing event, but most estate planning documents provide for “<span class="blsp-spelling-error" id="SPELLING_ERROR_0">afterborn</span>” children and therefore no change would be necessary. Nevertheless, for many individuals s, a regular review can at <span class="blsp-spelling-corrected" id="SPELLING_ERROR_1">least</span> provide you with some comfort that the documents you have contain the best estate design for you and your family.</div>Jack Carneyhttp://www.blogger.com/profile/15627378322758218377noreply@blogger.com0