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The estate tax is a tax on property transferred at your death, and recent changes in the tax laws have increased the amount that you are allowed to pass on to your heirs before you owe the IRS. For those who die in 2016, the $5.45 million (per spouse) threshold is high enough to keep most Americans from having to consider federal estate taxes. However, Motley Fool notes in “Does My State Have an Estate Tax?” that 14 states and the District of Columbia have estate taxes of their own. These laws frequently impose taxes on much smaller estates. The big challenge for residents in these states is that the maximum size of an estate you can pass to heirs without owing state estate tax doesn’t have to match the federal exemption. You have Hawaii and Maine, which currently match the federal $5.45 million exemption amount. Maryland, New York, and Washington, D.C. each have laws that are gradually raising their state exemption amounts to match the federal amount. But there are other states with much lower exemptions, like New Jersey. Its state estate tax exemption only goes up to $675,000. Oregon and Massachusetts have $1 million exemptions. Similarly, and Rhode Island’s $1.5 million and Minnesota’s $1.6 million thresholds are all much lower than the federal exemption. The tax rates that states impose are also frequently very hefty. Some states that are tied to the old federal pick-up system typically charge graduated rates from 0.8% up to 16%. Washington State’s top rate is 20%, and Oregon and Hawaii reflect the old systems maximum rate of 16%. Also note that many states offer deductions against estate taxes that in some cases can prevent an estate from having to pay tax. For example, the same marital deduction that allows you to pass assets to your spouse estate tax-free at your death typically applies in state estate tax situations as well. Talk with a qualified estate planning attorney about a sound estate planning strategy to help you reduce or eliminate potential “state” estate tax liability. Be aware of the possibility of having to pay estate taxes at the state level because of where you live. Decisions about where you want to spend your retirement should weigh state estate tax provisions. While estate taxes at the federal level typically impact those who are extremely wealthy, because state estate taxes in some locations apply to much smaller amounts of wealth, you need to pay close attention to make sure that you won’t end up handing your loved ones a huge tax bill when you pass away. Reference : Motley Fool (May 20, 2016) “Does My State Have an Estate Tax?” #estateplanning #EstateTax #TaxPlanning

US News’ recent article, “Pros and Cons of Whole Life Insurance,” says that life insurance is often an afterthought. In reality, life insurance should be one of the first considerations when people evaluate their financial picture. Life insurance—whether term or whole life—can be used to fulfill various planning goals. Insurance products and terminologies can be confusing, just like investing and the game of cricket. First, decide whether term or permanent insurance is for you. Term life insurance is used to cover risks over a certain period of time—like to replace your income until you retire, cover the last few years of a mortgage, or pay for the kids’ college. After those are covered, you don’t need that coverage anymore. Permanent or whole life insurance is typically more expensive than term and should be used for estate planning, leaving a legacy, transitioning ownership of a business, and covering burial expenses. The amount of face value, or death benefit, might be less than term because of premium costs, but the big difference is that whole life can allow for a buildup of cash value. If it’s held long enough, it can increase in value and face amount. This increase is usually tied to premium payments, dividends, and interest paid on the cash value. Life insurance can be confusing because whole-life policies can be offered in various forms by different insurance companies. A policy owner may customize coverage and buy extra coverage. That’s called a rider . Permanent life insurance has other benefits in addition to the death benefit. Depending on how the permanent life insurance policy is designed, it could provide tax-free income in the future. In addition, cash value life insurance can have products inside of the policy that can protect the cash value against any market loss. The goal is not to depend on life insurance in general or on any one particular type of life insurance to solve all financial planning needs. Life insurance isn’t a “silver bullet” for all planning needs but is one tool among many to help people achieve their living and legacy goals. Reference : US News (April 11, 2016) “Pros and Cons of Whole Life Insurance” #estateplanning #LifeInsurance

As a Houston will and trust lawyer, I can confidently say that estate plans are not one-size-fits-all. Just because most of the people you know have divided their assets evenly between their children, does not mean that is the right decision for you. To some, it may seem unfair to leave unequal amounts or different instructions to children after you die, but it may be necessary in your family, and it is important for y ou to do what is right and best for your heirs. For example, if you have a child with disabilities , it makes sense to leave them a larger inheritance to ensure that they receive proper care for the rest of their lifetime. Other times, we have seen clients with one financially established child that does not need a large inheritance while another child has not fared as well in life (possibly suffering a divorce, spousal death, or bankruptcy) and requires a little financial “help”. We have also had cases where the client’s child was unable to properly handle their finances , and the parents preferred to set up a trust with specific instructions on how the funds should be distributed to protect this high-risk child from themselves .  While these situations may not be “apples to apples,” it is clear that equal is not always best in such circumstances. This choice to leave your kids an unequal inheritance is NOT to be confused with cases where parents unintentionally leave more money to one child than the others.  This is a danger and a huge reason for working with a Houston will and trust lawyer to ensure that your estate is properly distributed when you pass away.   For example, if you have only one of your children named as a beneficiary of your life insurance or retirement account, that money will only go that child – even if you have a will saying otherwise.   Worse, that child is not required to share the money with his or her siblings.  This is because life insurance and retirement accounts are distributed outside of probate court and your beneficiary designations are the final authority as to what will happen with such funds. Here at Your Legacy Legal Care, we help families stay in complete control of their assets during their lifetime, and help people uniquely divide assets according to the family’s needs once they are gone. If you would like the peace of mind knowing that the distribution of your assets is a result of careful consideration and choice, call us today at (281) 885-8826 to schedule your consultation. #AssetProtection #family #willsandtrusts

Estate planning might seem like walking through a maze. It’s all about making big decisions for your family’s future and guarding the wealth you have built over the years. Luckily, with guidance from Your Legacy Legal Care , you won’t have to walk this path alone. A key part of estate planning is creating a will. This document tells everyone how you want your assets shared after you are gone. A will is pivotal in ensuring your wishes are honored. But it’s not a catch-all solution. There are specific items and details that, for various reasons, you should NEVER put in your will. 8 Critical Elements You Should Never Put in Your Will When crafting a will, it’s as important to understand what to exclude as it is to know what to include. Below are eight pivotal elements that, while they might seem pertinent, should not find a place within your will: 1. Funeral Instructions It might seem intuitive to detail your funeral arrangements in your will, envisioning it as a final wish. However, often, wills are not examined until after the funeral has occurred. Instead of risking your desires being overlooked, it is prudent to relay your funeral wishes directly to trusted friends or family. Alternatively, document them in a separate, easily accessible place to ensure they are respected and followed. For example, our team provides a Memorial Instructions document to note your wishes regarding your funeral arrangements. 2. Assets Held Jointly Assets owned in joint accounts usually possess a right of survivorship. This means they automatically pass on to the surviving joint owner upon one’s passing. Including such assets in your will can muddle the process, as these assets are already legally earmarked to transition to the co-owner. 3. Beneficiary Designations Certain assets, including life insurance payouts, retirement accounts, and payable-on-death accounts, come with pre-determined beneficiary designations. Even if your will suggests otherwise, the previously chosen beneficiary will be the lawful recipient. To prevent future conflicts and ensure alignment with your current wishes, regularly review and update your beneficiary designations, especially after significant life events. 4. Illegal Gifts and Requests Including provisions that border on the illegal or that contravene public policy can jeopardize your will’s validity. This does not merely extend to requests that are overtly illegal but also to ones that may inadvertently go against established norms or policies. 5. Temporary Provisions Incorporating fleeting obligations or short-term loans can lead to constant revisions and potential disputes. Keeping the content of your will consistent with long-lasting intentions ensures its resilience and relevance over time. 6. Personal Feelings A will, while deeply personal, is a legal document. Including emotional explanations or justifications for your choices might seem cathartic, but it can sow discord among beneficiaries. Beyond potential hurt, such inclusions can be grounds for contesting the will. Aim for clarity and objectivity to maintain harmony and uphold the will’s primary purpose. 7. Property in Living Trusts Assets in a living trust are designated to bypass the probate process , making their distribution more efficient. Mentioning these assets in your will can create confusion since they are already set to be managed by the trust’s terms. To avoid legal ambiguities and potential disputes, keep trust-held assets separate from your will’s directives. 8. Specific Details on Small Personal Items While your will addresses significant assets, detailing every minor possession can over complicate matters. As possessions evolve, frequent will updates become cumbersome. Instead, use a separate memorandum, referenced in your will, to manage the distribution of cherished personal items without cluttering the main document. By understanding and avoiding these pitfalls, you can craft a will that’s both robust and reflective of your genuine intentions, ensuring peace of mind for you and your loved ones. Why Choose Your Legacy Legal Care for Help Drafting Your Will At Your Legacy Legal Care, we understand that estate planning requires meticulous attention to detail. From drafting wills to creating advance health care directives, we are committed to ensuring that your wishes are honored and your assets protected. Our experienced team has successfully guided countless individuals in Houston through the estate planning process , helping them prepare for potential future incapacities, retirement, and ensuring the well-being of their families. Moreover, our spectrum of services goes beyond just drafting wills. Whether you are seeking to develop and implement strategic asset protection, establish a special needs trust, or engage in business succession planning and long-term care planning, our team is adept at tailoring solutions that cater to your unique needs. In the realm of estate planning, knowledge is power. The decision of what you should and should not include in your will is paramount to ensuring that your legacy is preserved in the way you envision. With Your Legacy Legal Care, you have the assurance of working with honest, compassionate, and informed professionals who are dedicated to safeguarding your future and the future of your loved ones. Reach out to one of our offices in the Houston area and begin your journey of ensuring a legacy of care, protection, and love for your family. Securing Your Legacy: Making the Right Choices with Your Will The process of creating a will is a significant step in securing your legacy. By understanding what to include and what to omit, you can ensure your wishes are met without complications. Engaging with an experienced will lawyer can ensure you navigate these intricacies with precision. At Your Legacy Legal Care, we are here to provide the guidance and expertise you need every step of the way. Secure your legacy with us by contacting us today. Contact Your Legacy Legal Care

In 2020, COVID-19 shook the world. In 2022, we are still collectively reeling from the impact of the pandemic. As of February, the consumer price index has risen 7.9 percent year over year. From the gas station to the grocery store, Americans are feeling the hit in the wallet everywhere they go. Since there is no way to predict exactly how or when the impact of inflation might slow, it is important to factor it into your retirement plans. Everyday purchases, travel, and other expenses are likely to continue to rise in price. Inflation decreases the value of your savings and will continue to do so long after you retire. That is why it is so crucial to look at your investment strategy and retirement income plan to see if you will be protected from inflation in the long run. According to research done by the Senior Citizens League , Social Security benefits have lost more than 30 percent of their purchasing power since 2000. Benefit increases have failed to keep up with the rising cost of food, medicine, and housing. This is in spite of yearly cost-of-living adjustments for Social Security benefits designed to combat the effects of inflation. Consider what might happen if your retirement income lost 30 percent of its value over the span of two decades. Would such a scenario make it more likely that you might run out of money? How do you know how much income you will need post-retirement? The answers to these questions are complicated – here are a few other considerations to factor into your long-term financial and estate plans: Finding Sources of Fixed Income Fixed income sources in retirement will not keep pace with inflation. Think about the amount of interest you will earn in a savings account or CD. Since we are unlikely to see a significant interest rate hike in the next few years, anticipate earning very little in interest. Take a look at your investment strategy and retirement income to see if you will be truly protected against the impact of inflation in the long term. Sizing Up Your Nest Egg Do you know how much is in your nest egg right now? Try factoring in inflation over the course of 20, 30, or 40 years. While overall rates of inflation are likely to fall to some degree, prices will inevitably get higher over time. Utilities, food, healthcare, and other long-term costs can eat up a large chunk of your savings, so it is worth investigating how far your current nest egg might last you. There is not a one-size-fits-all approach to knowing how much you will need in retirement. To maintain your current lifestyle, most experts recommend having 80 percent of your pre-retirement income. For example, if you make $100,000 annually, you should aim to save $80,000. Most people will need over $1 million in retirement savings to ensure they don’t outlive what they have saved. Re-thinking Investment Strategies Consider whether your current investment strategy may need to be adjusted when you retire. If you can continue to grow your money in your golden years, you will be able to guard against the impact of inflation. Solid retirement planning makes all the difference when it comes to your purchasing power. Some may opt to take on less investment risk as they are approaching or hitting retirement, but the highest risk allocations can help thwart the impact inflation has on your nest egg. Control What You Can There is no denying it: inflation can be discouraging. If you are far out from your retirement date, today’s inflation issues are not likely to impact your savings much. One of the best ways you can protect yourself from inflation’s impact is to invest. Cutting down on spending until you have got more purchasing power is another great strategy. While it is easy to feel overwhelmed by headlines, it is important to focus on controlling what you can. By taking an active role in your estate plans, you will feel more empowered about retirement. Schedule a chat with one of our team members today to learn how inflation’s impact on your retirement assets may also affect your estate plans.

As a Harris County will and trust lawyer, I realize that those of us in the estate planning industry often use technical language or “legal jargon” that is hard for most people to understand when setting out to get their affairs in order.  In fact, even the words “estate planning” can confuse people by making seem like you only need to plan if you have a large estate.  Not true! There are other terms that you have probably heard along the way that can be equally confusing, as they are similar in theory, but different in execution. For example: Estate planning versus Asset Protection Healthcare Directive versus Advanced Directive versus Living Will Power of Attorney versus Executor of an Estate However, there are probably two estate planning terms that you will hear more than any other; trust and will .  Wills and Trusts are key documents that do essentially the same thing, in theory. They both specify your last wishes and appoint someone to carry them out. However, there are reasons you would choose one over the other and sometimes you might choose both! Hopefully we can help you understand the basic differences so that you have an idea of which legal tool (or combination of tools) would be best for you and your family. Living Trusts Pros Ensures privacy, keeps your affairs out of the public record and helps you avoid probate. If you own property in another state, a living trust may keep you out of that state’s probate court. Some trusts offer protection from creditors, lawsuits and predators during your life. You can designate a person who can take over management of your assets in case you are unable to function or incapacitated during your You may not need to hire a lawyer when it comes time to distribute your assets. Cons A living trust can be more expense to set up initially. You will also have to transfer ownership of all assets that are placed in the trust. It can make it more complicated if you want to refinance property. You cannot create a guardian for your children in a living trust. (However, you would be able to add a designation of guardian to supplement your trust that would take care of this.) Wills Pros Setting up a will is less expensive and much simpler. Creditors can only bring claims against your estate for a certain period of time. You may name a guardian for your children. You do not need to transfer any property. Cons After probate, your will becomes a matter of public record. Probate can be take years to resolve and can be expensive. A will does nothing for you while you are Your loved ones will be unable to manage or transfer assets using your will if you are incapacitated and/or unable to function. There is quite a bit more to it, but this gives you an idea of the different techniques. If you really want a plan in place that will work when you need it, it is best to talk to a Harris County will and trust lawyer. Only an attorney that has had extensive experience can understand the nuances that could impact whether you have solid plan or simply a stack of paper that will not stand up in court. We help families throughout Houston gain the peace of mind that only comes with knowing your family will be okay no matter what. Call us today and mention that you read this blog and we will give you a consultation so you can start the ball rolling on this important task. #HarrisCountywillandtgrustlawyer #willsandtrusts

The National Institute on Aging has announced that scientists are now using magnetic resonance imaging of the brain to examine those parts associated with money managing abilities. Because aging makes seniors more vulnerable with financial decisions, those with Alzheimer’s or dementia are at special risk—even in the early stages. “Can we actually see a picture of this?” asks Forbes in its article, “Will Brain Images Tell You If Your Aging Parent Can’t Handle Money Any More?” The NIA report cites a prominent researcher, neuropsychologist and lawyer, Dr. Daniel Marson, who says that it’s “the $18.1 trillion problem.” Dr. Marson, a professor of neurology at the University of Alabama at Birmingham, is referring to an estimate of household wealth held by U.S. adults age 65 and older. Although they haven’t yet found a way to pinpoint an exact spot in the brain that says a person is or isn’t competent with finances, the report details the efforts using MRIs to find out more about the brain and financial capacity. The professor says that changes in some parts of the brain are linked to loss of financial capacity. The report also cites director Nina Silverberg, who commented that “Novel neuroimaging studies, along with studies involving cognitive measures, are providing intriguing data on why older adults—even those who were previously quite savvy about finances—may lose their money-managing abilities.” Silverberg is the program director of the Alzheimer’s Disease Centers at NIA’s Division of Neuroscience. Here are some takeaways to help with an aging parent who has signs of dementia or related illness: When the first indications of a memory issue arise with your loved one, try to be more involved in monitoring their spending and money management. Get online access to their bank accounts—even if you just watch what comes in and goes out. That way you can intervene if a problem arises. You can also offer to pay bills for your aging parents, and it may even be a relief for them. Handling money can be confusing when a parent declines cognitively, serving as a sign of cerebral impairment. Get to know your aging parent’s financial advisor, attorney and others involved in his or her financial life, and ask your parent for written permission to talk with them. A notarized power of attorney or a letter granting you access to financial information would be required. Tell these professionals about any concerns you have and keep in touch. An ethical professional will want what is best for the client. A piece of that $18.1 trillion Dr. Marson cited may include some of your potential inheritance, so you’ll want to act to help preserve it. Don’t assume that if your aging parent is okay now that it will stay that way. Even without the science, you should realize that some folks will experience cognitive disorders as they get older—your aging parents just might need your help now and in the future. Reference : Forbes (July 27, 2016) “Will Brain Images Tell You If Your Aging Parent Can’t Handle Money Any More?” #AssetProtection #EstatePlanningLawyer #PlanningfortheFuture #Dementia #PowerofAttorney #ElderLaw

Marriage is about compromise, which usually means coming to an agreement about where to live, whether to have kids, and possibly even when to retire. Unfortunately, some couples find themselves in complete disagreement about planning for the future. Retirement is something so many people look forward to; especially with your significant other. If you find yourself frustrated by your spouse’s outlook on estate planning and planning for your future together, consider these tips: Assess Your Finances Together Coming to a place of mutual understanding about your finances can help get couples on the same page about the future. Take a thorough look into your debts, your savings, property that is owned, investment accounts, insurance policies, and any retirement accounts you have. This can paint a more complete picture of what lies ahead and about how you should be planning for your golden years now. Define Your Dreams Perhaps you have always dreamed of spending your golden years in a villa in Tuscany. Maybe your spouse has imagined themselves in a senior community by the beach. Regardless of your dreams for the future, it is important to understand each other’s goals. This is especially true of your shared legacy that you leave behind when your time expires. Will you leave your assets to a favorite charity, or will the things you worked hard for your entire life be inherited by a loved one? These kinds of dreams are not as fun to consider as your retirement plans, but they are just as important. Understand Your Options As you discuss estate planning with your spouse, also be sure to consider possible unexpected occurrences. While it is hard to plan for the worst-case scenario, playing with the theoretical can help you and your partner make informed decisions for your family. Are you prepared to handle a serious illness? What about the sudden death of your spouse, child, or even grandchild? Answering these tough questions can help you come to a mutual understanding about your options for the future and take action now to better prepare your family for sudden tragedies. Talk with an Experienced Estate Planning and Elder Law Professional If you and your spouse are still struggling to get on the same page about estate planning, it may be time to consult with a professional. Your Legacy Legal Care can answer questions you have about your options and help you decide on the right plans for your family’s future and has experience in proposing options that fit both partners’ interests. Do not wait until the last minute – click here to schedule online or call us at (281) 885-8826 to get started now. #disagreement #jointestateplan #jointtrust #spouse

A recent high-profile guardianship proceeding has captured the attention of Houston and has shed light on the intricacies and potential legal pitfalls of one subject to a guardianship matter. The unfolding drama has not only underscored the importance of understanding guardianship laws but has also prompted a crucial conversation about how individuals can proactively navigate these complexities to prevent legal turmoil for their loved ones (and themselves). Guardianship matters involve significant decisions that impact the lives and well-being of individuals that have been deemed unable to manage their personal and financial affairs independently. Our goal is to inform you of what guardianship matters consist of and educate you about what you can do to prevent you and your loved ones from being subjected to public court proceedings. If you find yourself or your loved one in need of guardianship, an experienced guardianship attorney is someone to visit with to discuss the options that may be available in your circumstances. Case Analysis On November 27, 2023, Robert Cary McNair, Jr. (“Cary”) filed an Application for Appointment of Permanent Guardian of the Person and Estate for his mother, Janice S. McNair. Janice owns interest in the Houston Texans NFL Franchise and is the Senior Chairman of the Texans and, according to the Application filed by Cary, is allegedly incapacitated and unable to make her own medical and financial decisions. As of now most of the pleadings filed with the court are sealed due to a Temporary Sealing Order, but according to the Harris County Probate Records, the guardianship is being contested by Janice and her son, Daniel Calhoun McNair. Both Janice and her son, Daniel, have filed Affidavits with the court stating that not sealing the records of this proceeding will cause immediate and irreparable harm to all parties involved due to the confidential nature of the information that will be submitted to the court. While most guardianship proceedings are available to the public, the judge assigned to this case has signed a Temporary Sealing Order that restricts the public’s view of the pleadings until an Order has been signed to permanently seal the court records. How to Avoid Guardianship Disputes According to the pleadings filed with the court that are currently available, in addition to the Application filed, Cary McNair also filed copies of Janice McNair’s Medical Power of Attorney and Statutory Durable Power of Attorney. While these documents are executed to help prevent the need of guardianship, it does depend on what these documents allow an agent to do on your behalf. Limiting the authority of the person you appoint as your agent may cause the need for a guardian in the future. Properly executing legal documents such as a medical power of attorney, statutory durable power of attorney, and other healthcare directives is imperative so you can avoid being subject to a time-consuming and costly court process. Some of the documents that your estate plan should consist of include: Statutory Durable Power of Attorney Medical Power of Attorney HIPAA Authorization Directive to Physicians (also known as a Living Will) Declaration of Guardian Last Will and Testament Living Trust Having a comprehensive estate plan is of paramount importance as it serves as a strategic tool to navigate life’s uncertainties and avoid potential issues such as guardianship and probate. Working with an experienced estate planning attorney can help provide peace of mind knowing that you and your loved ones will be properly protected throughout life’s “what ifs”. The Importance of Reviewing Your Estate Plan Regularly reviewing estate planning documents is a cornerstone of responsible financial and personal management, emphasizing the dynamic nature of life’s circumstances. Proactive planning involves not only creating a comprehensive estate plan but also staying attuned to changes in one’s life, assets, and relationships. Life events such as marriages, births, divorces, or changes in financial status can significantly impact the efficacy of an estate plan. By revisiting and updating documents such as wills, trusts, and power of attorney regularly, individuals ensure that their plans remain aligned with their current intentions and the ever-evolving legal landscape. Plan Today While the high-profile guardianship proceeding involving the owner of the Houston Texans, Janice McNair has shone light on the complexities of a guardianship process, it has also illuminated the importance of planning for tomorrow. Proactive planning can minimize the risk of having to go through an expensive, public, and time-consuming court process that the McNair family is currently facing, ensure your intentions are accurately represented, and provide a solid foundation for protecting your loved ones. Engaging with an experienced estate planning attorney is a crucial step in this journey. Contact Your Legacy Legal Care™ today so we can provide you with peace of mind and security amid life’s uncertainties. Call us at (281) 218-0880 or schedule online here to get started today!

One of the most enjoyable parts of being a Harris County estate lawyer is helping clients set up trusts. Knowing that they have the ability to positively impact future generations or even a cause they care about can be a life-changing experience for a person. The fact that estate planning lawyers are a part of it is almost a bonus to the job. There is an area, though, that so many clients forget, and if it goes without being caught, it can cost the trust and heirs a great deal in the future. Setting up the trust can be a lot of fun. Figuring out how to fund it is deeply satisfying. Naming trustees and heirs is profoundly rewarding. Directing how the funds will be managed is…very often overlooked. Yes, despite putting so much effort, and even a sense of personal value into setting up the trust, a huge number of people do not think about the importance of how the money will be managed later. If you do not provide guidelines for how the assets of the trust are to be managed, it is quite possible that your family or other heirs will suffer for it. Here are just a few ways that trust lawyers in Harris County have seen this situation go poorly: 1. Some institution is put in charge of administering the trust, but with little oversight. The financial advisors are given too much freedom to play “fast and loose” with the money, as well as to charge exorbitant fees. This institution and the advisors it hires do not have much concern beyond what they can get out of the trust. 2. A friend or family member is put in charge of the trust with the best of intentions, but unfortunately, he or she does not have the right skill set to manage the funds. This person, though someone you trust, just does not have the knowledge and experience required to make good investments, to minimize tax implications, etc. To make matters worse, if this person’s efforts are not “good enough,” it can anger the other heirs. 3. A “directed trustee” is chosen to look after the trust according to specific instructions from you. These may include professional companies that do nothing but administer trusts. In addition to knowing the organization has experience, you can also provide guidance on the principles that you want followed when it comes to investments and other decisions. By having your estate planning lawyer include directions for a directed trustee, you can mitigate some of the concerns that come with choosing a family member or giving a financial planner too much leeway to make decisions for the trust. Obviously, you cannot predict how markets will change and what new developments will arise after your death, but you can determine good approaches for now and potentially give your trustee some discretion if and when it is appropriate. Again, a Harris County trust lawyer will be instrumental in creating the language needed to guide the directed trustee and others involved with the trust.

Congress used to wait until the end of the year to extend the law that let people make a tax-free donation of up to $100,000 from their IRA. This left some folks scrambling to make the contribution before the RMD deadline. However, now Congress has made the law permanent, which means that if you’re 70½ or older, you can transfer your 2016 RMD to charity at any point. The donation counts as your RMD but won’t increase your adjusted gross income, according to Kiplinger’s article “Donate Your RMD Tax-Free to Charity in 2016.” That can be helpful if you don’t itemize and can’t deduct charitable contributions. In addition, keeping some or all of your RMD out of your adjusted gross income could help you avoid the Medicare high-income surcharge or help make less of your Social Security benefits taxable. The RMD must be transferred directly from the IRA to the charity to be tax-free. However, if you withdraw it from the IRA first and then give it to the charity, you get to deduct the gift as a charitable contribution (if you itemize), but the withdrawal is included in your AGI. Now that this law is permanent, IRA administrators have begun to simplify the process. As an example, Fidelity will soon introduce a new form to make it easy to transfer the money and clearly state your wishes to the charity. If your IRA has check-writing privileges, you can write the check directly from your account to the charity. Otherwise, the IRA administrator will write the check and send it directly to the charity. However, the charity may not receive clear instructions as far as who it’s from or where the money should be directed. If your IRA administrator doesn’t allow check writing but will transfer money directly to the charity, contact the charity ahead of time and let it know a check will be coming from your IRA. The charity sends you a receipt for your taxes. You can instruct the charity as to which fund or program you’re supporting. One last note: you can make the tax-free transfer from the IRA to a charity but not to a donor-advised fund. Speak with an estate planning attorney to explore how charitable giving can be part of your estate plan to minimize taxes and create a legacy. Reference : Kiplinger (May 13, 2016) “Donate Your RMD Tax-Free to Charity in 2016” #IRAs #RequiredMinimumDistribution #CharitableContribution #TaxPlanning #estateplanning

You thought you purchased just about everything for your child for college, but don’t forget one more important item: a health care power of attorney or health proxy. When a child turns 18, parents don’t have much authority under federal law to remotely access medical records or make decision. With the medical privacy law HIPAA, you need to have your child’s written permission. CBS News’ recent article, “Don’t send your child to college without this,” suggests a health care proxy. It’s a pretty simple legal document that gives you the authority to make medical decisions and access their records if they’re disabled. Talk about a critical back-to-school item! A health care power of attorney is critically important when a child has a health emergency at college. A HIPAA authorization allows you access to your child’s medical records, which are protected by the Health Insurance Portability and Accountability Act (HIPAA). Your child is an adult, so you can’t call the health center at college and get his or her detailed health information without an authorization. The health care proxy is more complicated. The one signing it is giving another the authority to make medical decisions for them if they become incapacitated. An agent for health decisions is appointed with the proxy. The proxy covers a broad range of powers, and parents or other trusted individuals who are agents are allowed to speak with doctors, approve tests and examine medical records. Prior to getting these forms, you should have a serious conversation with your college student on why the documents are important. The proxy talks about some unpleasant decision making—like specifying what treatment or care a person on life support wants and stipulating organ donation and other post-mortem issues. Some of the more detailed proxies have a questionnaire that runs through end-of-life or advanced “health care directive” decisions. As a parent, this is tough language to read, and these are difficult issues to discuss. Nonetheless, they provoke some serious thinking about quality of life in the event of a health emergency. It’s important to know what the documents can and can’t do: they don’t ensure quality care, and you’ll still need to consult with doctors. Be sure you fully comprehend what these documents mean and how you can modify them. Speak with your estate planning lawyer and appoint trusted family members or friends to make decisions if you or your spouse/partner can’t. You should also, at the same time, review your own estate plan. If you don’t have a will, powers of attorney or living trust, find out which documents are appropriate for your situation. Reference : CBS News (September 9, 2016) “Don’t send your child to college without this” #College #EstatePlanningLawyer #HealthCarePowerofAttorney #HIPAAAuthorization