The Wiewel Law Firm

Age-Restricted Communities on the Increase

You have choices, so what are your interests?

There are a number of options with age-restricted communities. However, active community living is one of the growing choices, according to Next Avenue in “How to Choose a 55+ Active Adult Community.”

How can you determine which is the best for you?

There are small, city-based apartment complexes, single family houses on gated golf courses and mammoth communities with more than 9,000 residents. Many are owned by their occupants, but an increasing number are rentals. At least one of the owners or occupants must usually be at least 55.

You’ll need to know exactly what you can afford. In addition to rent or a mortgage payment, most communities have a homeowner’s association or community fee. They can be around a hundred dollars a month or more.

While some communities have restaurants on site, fees don’t cover meals or health care. The monthly fees go towards maintenance of facilities and general exterior care, like lawn care, snow removal and community facilities, like a club house or a pool.

Run the numbers to be sure the costs of a new home will work with your retirement budget.

How active is the community? Some communities have club houses, organized activities and busy social schedules. Some take big trips, like cruises, with residents. Others have few structured activities. Take a look at the schedule—if everything looks like fun, then you’re looking at the right place.

What about your changing needs? You may arrive in the community as a healthy young retiree, but over time your needs will change. Does the home feature “universal design” that will be manageable as you age? This includes no-step entries, single-floor living, wider hallways to accommodate wheelchairs and a walk-in shower.

Take a look outside of the community as well. Are there things that you want to do in the area, like bicycling, shopping, visiting a museum or seeing a live performance? If travelling is important, how far is the community from major highways or an airport? For many retirees, living near a college community is an added boost for the ability to audit classes and attend shows, lectures and festivals.

Another way to future-proof your retirement home is considering where your children and grandchildren are living because many retirees want to relocate near their children.

Reference: Next Avenue (June 12, 2019) “How to Choose a 55+ Active Adult Community”

Too Many Victims Makes Compensation Difficult

Las Vegas killer leaves large estate, but fair compensation for the victims will be a challenge.

Despite a hefty estate of $5 million left behind, it will be difficult to compensate the victims of Las Vegas mass shooter Stephen Paddock, according to The New York Times in "The Las Vegas Gunman Was Rich. Will His Wealth Go to the Victims?"

It still is not known exactly why mass murder Stephen Paddock decided to shoot at Las Vegas concert goers from his hotel window. He was relatively well-off and had not been in trouble as far as anyone knows.

Despite the mystery surrounding his motivations, his victims and their families would like to be compensated for his actions.

His estate is worth approximately $5 million. That money would ordinarily go to his mother,  since Paddock is not known to have had an estate plan.  However, Paddock's family has indicated they have no interest in his estate.

There are some challenges to making sure that all the money goes to the victims.

The first is that the estate could be rolled into an existing victims' compensation fund that has already raised $22 million.  However, all of the victims might not be eligible for compensation under the fund's rules.

The second challenge is that many victims are filing independent claims and lawsuits to the estate.

Reference: New York Times (Dec. 23, 2017) "The Las Vegas Gunman Was Rich. Will His Wealth Go to the Victims?"

The Best Medicine is an Estate Planning Attorney!

Laura, a single mother with breast cancer, no income, and no medical insurance, was over $300,000 in medical debt. While her doctors addressed her cancer, they could do little to help her deal with the devastating financial consequences of her illness. Fortunately, Laura's doctor referred her to a nonprofit that provides free legal services to low-income people living with cancer. Her attorney was able to get her approved for Social Security Disability, and eventually Medicaid, which retroactively covered all of her medical bills. Laura's story is not unusual. People living with cancer face daunting legal and economic challenges. Many struggle with insurance disputes, obtaining public benefits, housing, loss of employment, future care and custody planning of minor children and estate planning. The ramifications of cancer have a particularly disproportionate and destructive effect on uninsured, low-income, and at-risk populations. The National Cancer Legal Services Network (NCLSN) was established in 2009 to increase the availability of legal services for people like Laura. By connecting cancer patients with legal services, the NCLSN works to lift their legal burdens, allowing them to focus instead on their medical care and improving their quality of life.

The Huffington Post’s recently published “When an Attorney Is the Best Medicine”explains that cancer is the second leading cause of death in the U.S. In 2020, there will be about 18.1 million cancer survivors in the U.S., which is 30% more than in 2010. Half of all men and one-third of all women in the U.S. will develop cancer at some point in their lives. Although the five-year survival rate for all diagnosed cancers has improved, the rate of cancer diagnosis and the costs of cancer also go up.

The National Institute of Health believes that by 2020, direct medical costs alone will be at least $158 billion—an increase of 27% over 10 years. This means patients often face great difficulties in paying for housing and groceries. Cancer patients with major financial issues are also more likely to suffer from depression and anxiety.

However, attorneys who work with health care professionals can help with many of the non-medical issues that impede a person's cancer prognosis and life expectancy. Identifying healthcare coverage options, securing coverage, and assisting patients with providers disputes are some of the big problems with which attorneys can help. An attorney can also help patients with housing issues, dealing with Social Security and other benefits and end-of-life planning.

Legal assistance helps patients help themselves. Those who received legal services become better advocates on their own behalf. Healthcare systems see a benefit as well; with an attorney acting as part of the healthcare team, doctors are able to focus on the patient's health.

Fighting cancer alone can make anyone vulnerable. Fighting cancer and also dealing with a serious legal matter can have horrible effects on patients and their families. Work with an experienced elder law attorney and get help so you and your loved ones do not face a disease like cancer alone.

Reference: Huffington Post (August 14, 2015) “When an Attorney Is the Best Medicine”

Fast And Furious Star Slowed Down To Plan Ahead

No One Should Wait Until They Are Old To Do Estate Planning. Paul Walker’s will was signed in August of 2001, when he was only 28 years old.  This is the same year his first Fast & Furious movie was released.

Although it seems that there are lessons to be learned from the mistakes of others, celebrity mistakes can seem all the more colossal. Forbes recently pointed out some of the sound planning Walker did at an early age and before much of his stardom in an article titled “Five Estate Planning Lessons From The Paul Walker Estate.”

For example, in his will, Walker left all of his assets to a trust he created.  This can create a much easier and simpler probate process. It was a revocable living trust, which is a very effective estate planning tool. Although it isn't a public record, if Walker went to the trouble of creating the trust, he most likely was concerned about the way that his young daughter would be handed his large estate.

Many young people do live life "fast and furious" and don't think ahead to the future. Take a break and sit down with an estate planning attorney sooner versus later.  You never know when it will be too late.

Reference: Forbes, February 10, 2014: “Five Estate Planning Lessons From The Paul Walker Estate”

Bankruptcy And The Inherited IRA

The U.S. Supreme Court will hear a dispute in the bankruptcy of a small-town pizza shop owner, taking on a case that could dictate how inherited individual retirement accounts are treated in bankruptcy.

Is a retirement account that is “inherited” still a retirement account? This may sound like a rhetorical question, but it is currently one before the U.S. Supreme Court in the matter of Clark et ux. V. Rameker et al.The decision could have important ramifications for those who are looking to leave an IRA to their heirs – and NOT to the heirs and their creditors.

This issue was explored by Reuters in a recent article titled “U.S. high court to chart fate of inherited IRAs in bankruptcy.”

You see, the Clarks inherited a $300,000 IRA and then went into bankruptcy to the tune of some $700,000. Consequently, when the bankruptcy trustee became mighty interested in the IRA, the Clarks cried foul. As a general rule, IRAs are exempt from many bankruptcy proceedings of the account owner. Some courts have upheld this protection even when the account is inherited by one who is not yet a retiree and is not the account owner, but still complies with the strict distribution requirements for inherited IRAs.

Other courts have been less favorable and now it is up to the highest court.

It may seem strange to think about bankruptcy when planning for the eventual distribution of your IRA to heirs. After all, leaving your heirs behind is one thing, but ensuring that they are protected is a still greater step.

How will the Supreme Court determination affect you?

Reference: Reuters (November 26, 2013) “U.S. high court to chart fate of inherited IRAs in bankruptcy”

Post-DOMA: Same-Sex Prenuptial Agreements

What makes this wave of marriages quite different, however, in addition to the fact that it is boy-boy and girl-girl, is that these marriages will be predominantly of couples who are already established in life and carry with them substantial financial detritus, good and bad.

If you are not yet married to your same-sex partner, but intend to do so, then one of the most important things to plan for is that gay marriage is still wholly new. Then again, the next most important thing to plan for is that the problems of late-in-life marriage will affect you irrespective of the gender of the partners.

A recent Forbes article titled “Before Marriage, Same Sex Couples Need Prenups,” provided some pithy advice.

The term “late-in-life marriage,” while perhaps not soft on the ego, is a term designed to acknowledge that you are not blushing eighteen-year-olds, with no assets, careers, or names in the world. In fact, most same-sex partners, couples, and married persons will have fully established and separate financial and legal lives, sometimes by design and often by strict necessity. Regardless, marriage in this new, post-DOMA world will mean a collapse of those borders.

Whether heterosexual or homosexual, couples that are comprised of well-established individuals have so much to consider, including retirement accounts and even accrued liabilities. Consequently, marriage may require planning what should be joined and what should remain separate.

The original article illustrates how prenuptial agreements are being deployed today as more and more persons marry “late-in-life” and that same-sex marriages are (now) no exception in this regard.

Either way, “marriage” is and always has been a very legally loaded term. We are still learning what same-sex marriage will mean, and to some extent we are still learning what marriage in this day and age will mean. Regardless, a solid prenuptial agreement is an important consideration. 

Reference: Forbes (June 27, 2013) “Before Marriage, Same Sex Couples Need Prenups”

Same-Sex Marriage And The Supreme Court

Gay couples have long had second-tier status when it came to their finances… Now that the Supreme Court has struck down the Defense of Marriage Act, some of these issues will be wiped away. The ruling makes clear that married gay couples living in states that recognize their unions will immediately gain access to more than 1,000 federal benefits, like Social Security and family leave rights. Less certain is how couples living in the remaining 37 states will fare.

It’s been something of a fairly eventful Supreme Court season this year. With many important decisions covering many important topics, few issues have been so radically altered as that of same-sex marriage.

The Supreme Court, in its last actions of this term, rendered two important decisions on the topic of same-sex marriage. Now it’s time to figure out what these rulings mean moving forward. A recent article in The New York Times, titled “How the Court’s Ruling Will Affect Same-Sex Spouses,” provides a good start.

For those planning for their estates, the important decision was rendered in US v. Windsor, a case many have been following quite intently and for good reason. The case centered on a common conundrum of many in same-sex marriages: married by state law, but strangers by federal law. And of course, the Federal law in issue was The Defense of Marriage Act, or DOMA, as signed into law by President Clinton. DOMA changed the definition of marriage to literally require different gender partners, but this has been struck down.

Consequently, all of the federal benefits ascribed to the term “marriage” will extend to same-sex marriages as well. These include, but are not limited to, social security, estate and gift tax law, and common law spousal provisions. In short, it’s a groundswell and the ground won’t stop moving until we figure out all of the ramifications.

Read the original article for more specifics, but many questions remain. For example, will estate planning be just the same for same-sex marriage now?

Reference: The New York Times (June 26, 2013) “How the Court’s Ruling Will Affect Same-Sex Spouses”

Same-Sex Marriage Hits High Court in Estate Tax Case

The spousal exemption to the estate tax is denied to same-sex couples because of the Defense of Marriage Act (DOMA), a law passed by Congress and signed by the president in 1996 that defines marriage as between a man and a woman. Windsor is challenging DOMA in a case the nine-member high court will hear on March 27. At its core, Windsor's fight is with the Internal Revenue Service over how much federal tax she owes on [her same-sex partner’s] estate.

Same-sex marriage has been and, likely, will continue to be a contentious issue in American politics. On March 27, however, the Supreme Court is set to rule in a case that may impact both politics and same-sex estate planning as we know them.

The case going before the Supreme Court is the story of Edith Windsor and Thea Spyer. The subject: the application of the federal estate tax in the context of a “same-sex marriage.” A recent article in Reuters considered the case and its implications. The article titled “Analysis: Death, taxes and Supreme Court's gay marriage case,” notes that the case began when Thea Spyer passed away and left her estate to Edith Windsor, her spouse under Canadian law. However, because the Defense of Marriage Act (DOMA) precludes same-sex marriage, Spyer’s estate was not recognized for purposes of affording the unlimited marital exemption.

This exemption permits a spouse to pass his or her estate to their surviving spouse without federal estate taxation. Because her marital status is not recognized under DOMA, Windsor had to pay the estate tax and her suit is to recover that payment. She is alleging that the basis of the tax, DOMA, is itself unconstitutional.

If the Supreme Court agrees with Windsor, the implications are profound on many levels, to include social and legal. Should DOMA remain the law of the land, then traditional same-sex estate planning will remain unchanged, but no less important.

Reference: Reuters (March 12, 2013) “Analysis: Death, taxes and Supreme Court's gay marriage case”

Same-Sex Adoption Snags

Adopting a child can be complicated. It can be even more complicated and fraught with financial and legal risks for same-sex couples.

Children change everything. That’s never truer than when those seeking to adopt a child are same-sex partners.

With state laws mixed on the matter and federal laws as yet unchanged, same-sex adoption is far from settled.

In the meantime, same-sex couples need to define their “families” from the laws as they are. The Wall Street Journal recently provided some insight in an article titled “For Same-Sex Couples, the Finances Get Even More Complicated.” Essentially, fundamental financial and estate planning is not optional for same-sex couples.

According to the article, some 2 million to 2.8 million children are being reared in same-sex households. Now, more than ever, same-sex couples must ensure that their wills, trusts, powers of attorney and health care directives are ship-shape. In the context of adoption, this means making proper provision for the guardians of an adopted minor child. And there is a lot of need.

Bottom line: same-sex couples that adopt children need to make sure all of their financial and legal ducks are in a row. For many this may mean a commitment to life insurance or to a carefully-drafted estate plan.

Reference: The Wall Street Journal (February 24, 2013) “For Same-Sex Couples, the Finances Get Even More Complicated”

When to Retire from a Career-For-Life?

Pope Benedict XVI’s announcement of his resignation … surprised the world. But while there’s only one pope, there are thousands of other professionals — including chief executives, entrepreneurs, university professors with tenure and artists — who face a similar conundrum: When you’ve got a job for life with no official retirement age, how do you know when it’s time to go?

Have you heard the news? Pope Benedict XVI will be the first pope to step down from his post in 600 years. Beyond the future-trivia questions, any question of religious affiliation, or the political scandals, there is a lesson to be learned and some important personal questions to be considered against this historic backdrop.

While you may not have the same problems or responsibilities as the Pope, have you reflected on your own future and when may be time to step down? This especially is true if you have no mandatory retirement age for your position.

A recent Marketwatch article titled “Retirement lessons from Pope Benedict” explored this timely issue. Whether you are the Pope, a business owner, or even a CEO there is always the question of succession. Aside from the business aspects, on a personal level make sure your advance health directives are current in the event you became infirm or incapacitated. While you are at it, a good top-to-bottom review of your estate planning likely is in order.

So, if you are responsible for millions of souls or just a few, the basic teaching point is the same. As the Boy Scouts famously advise – be prepared!

Reference: MarketWatch (February 11, 2013) “Retirement lessons from Pope Benedict”