August 3, 2020

Volume X, Number 216

July 31, 2020

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Estate Planning Considerations That Apply "Across the Board," and Not Just in Times of Global Pandemic

Our attorneys are fielding a lot of estate and planning related questions in the midst of the unfolding COVID-19 pandemic. 

To answer these important questions, we are publishing articles and client alerts and are advising and meeting with clients (albeit virtually—by phone, videoconference, and email) to make sure that their needs are met. 

This article contains information about the vital estate planning measures that all North Carolinians should have in place. 

Why You Need an Estate Plan

Estate planning is not just for affluent individuals.  While good estate planning can lead to desirable financial outcomes under the right circumstances, estate planning in its most basic form involves implementing the legal steps and directives that are necessary to ensure that your health and your assets are managed properly in the event of incapacity and death.  If your answer to any of the following questions is "yes," then you probably need an estate plan:

  • Do you want to make sure that your family has the legal authority to direct and take part in your medical care if you become ill?

  • Do you care how and whether your assets will pass to your spouse, children, or other beneficiaries at your death?

  • Do you want to avoid a costly and uncertain court proceeding if you, your spouse, or your adult child becomes mentally incapacitated?

  • Do you have minor children and specific desires about how they would be cared for in the event of your death?

  • Do you care about your finances and affairs becoming part of the public record when you die?

Foundational Estate Planning Documentation

The following documents are the foundation of any good estate plan.

  • Last Will and Testament. A simple will directs the disposition of a person's assets and names someone to handle final affairs, in the event of death.  In the absence of a Last Will and Testament, the disposition of your assets may be controlled by state law.

  • Revocable Trust. A revocable trust can help ensure that the management and disposition of your assets is more private and efficient during your lifetime and at death. Though not neccessarry or appropriate for all individuals, a revocable trust can be a useful tool in certain circumstances.

  • Durable Power of Attorney. A durable power of attorney names a spouse, adult child, or other individual(s) of your choosing to step in and handle your financial and legal matters when you are unable.

  • Health Care Power of Attorney. A health care power of attorney is a document that nominates a trusted person (usually a family member) to make health care decisions in the event of your incapacity.  Without this document, decisions about your medical treatment may be made by the doctor or might involve petitioning the court for a guardianship – an expensive and cumbersome process.

  • Living Will. A living will addresses medical decisions and directives related to end of life care.

  • HIPAA Authorization. The Health Insurance Portability and Accountability Act of 1996 ("HIPAA") protects an adult's private medical information from being released to third parties without the patient's consent.  Without a valid HIPAA authorization on file, a doctor or medical provider legally cannot, and frequently will not, discuss the patient's medical information with family members. 

Ownership and Beneficiary Designations

An essential component to planning for death involves reviewing the way that your assets and accounts are structured.  Asset ownership and account-specific beneficiary designations can supersede and undermine even the most carefully-drafted estate planning documentation.  Unfortunately, these aspects are often overlooked and unintended consequences ensue.  Having the advice of an attorney with significant experience in estate planning and administration is the best way to ensure that your assets and your estate plan will work hand in hand.

Changes in Circumstances

If you already have an estate plan in place, that's great.  But in the vast majority of cases, an estate plan will need to be updated over the course of a person's life.  If your estate plan no longer addresses your needs or accurately expresses your wishes, it's time for an update.  The following are common reasons for updating one's plan: (a) children grow up and become able to manage a parent's healthcare and estate matters, (b) changes in financial circumstances, (c) relocation to a new state, (d) separation, divorce, or remarriage, and (e) birth, death, or marriage of a beneficiary.

We're Here to Help

Practicing social distancing does not mean that you can't use this time to implement or update your estate plan.  With necessary precautions and the health of our clients top of mind, our attorneys are employing technology to undertake the estate planning process through electronic and virtual communication, and with as little in-person contact as necessary. 

© 2020 Ward and Smith, P.A.. All Rights Reserved.National Law Review, Volume X, Number 104

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About this Author

Peter von Stein Estate Attorney Ward and Smith
Trusts and Estates Attorney

Peter's practice involves a wide range of estate planning and administration issues.  He assists clients in the preparation of wills, trusts, durable powers of attorney, health care powers of attorney, and living wills.  Peter has experience assisting clients with testamentary and lifetime gifting, strategic tax planning, and asset protection.  He also works with clients to achieve long-term care objectives.

REPRESENTATIVE EXPERIENCE

  • Representation of Executor in administration of estate valued in excess of $25 million
  • Representation of small business owners...
252-215-4046