A Newsletter for Seniors and Their Families Which Address Recent Impacting Legal Issues and Translates the Legalese |
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HOT TOPIC: We Are Converting To An Electronic Newsletter and Client Alerts Via Email and Internet By Jack E. Stephens, Esq. |
Beginning in 2010 we will convert our Client Newsletter and Client Alerts to an electronic communication via email and the internet. I feel that in this small way I am doing my part to help save the environment and avoid the postage rates which will soon amount to a cost of $1.00 to mail two letters. In order to obtain our e-blasts alerting you of our newsletters, updates, seminars, and client workshops, we will need your email address. Please email it to jes@jackstephens.com or simply go to my website, www.jackstephens.com and register your email where indicated (Important: I absolutely keep email addresses confidential). If you do not have an email address consider using that of a family member, close friend or friendly neighbor. Also, this would be an excellent opportunity to include all of the emails of your Successor Trustees, executors in your Wills, agents in your Powers of Attorney, family members, friends, and neighbors who will benefit from the newsletters and estate plan updates. We anticipate significant alterations in the following which will be addressed in the New Year. 1. Federal Estate Tax Exemption which is presently at $3.5 million but to be reduced to $1 million in 2011 under present law. 2. Roth IRA removal of restrictions for conversion purposes. 3. The No Contest Clause in our Trusts have been under hot debate in California with legislative attempts to restrict their usage. These clauses have been utilized to reduce Trusts contests. 4. The increase in Trust contests by 3rd party creditors of beneficiaries in their attempts to obtain Court orders against the Trust to get to a beneficiary’s share of their inheritance. 5. The change in the laws on capital gains taxes on the sale of appreciated property by heirs in an effort by Congress to compensate for loss of federal estate taxes due to repeal of the tax in 2010. Our policy will be to alert you in our e-blasts to keep you alerted as to these new laws. We will also alert you as to when the current newsletter is available for viewing and/or downloading from our website. In this way, you can go to the website and print as many copies as you desire. Beginning in 2010, we will also have an archives page to download past newsletter issues beginning next year. Any scheduled seminars will be communicated by email so that you can make reservations accordingly. We have delayed this current newsletter and “Client-Only” seminar waiting on Congress to act on federal estate tax legislation which they have not addressed. Hopefully, that will be forthcoming. If they significantly change the capital gains tax step-up in basis laws as well, you will receive an alert email in January which will be detailed in the Winter newsletter or included in a “Client-Only” Seminar. For these reasons, it is extremely important that we obtain your email addresses by the end of the year. If you are not receiving our emails in January, contact the office to confirm the correctness of your email address.
Roth IRAS In previous years, taxpayers with adjusted gross income of $100,000 or more could not convert their retirement funds to Roth IRAs. However, in 2010 conversions will be allowed without this limitation. Additionally, the tax on the conversion in 2010 may be deferred to tax years 2011 and 2012 on an equal basis. What are the benefits of converting to a Roth IRA? 1. There is no future income taxation on funds converted; 2. Asset growth is tax free; 3. Roth IRAs are not subject to Minimum Required Distributions (MRD); 4. Reduces taxation on other income such as Social Security benefits; 5. Income tax free distribution to beneficiaries. Why convert in 2010? 1. No limitations on conversions; 2. Down market means less value on conversion funds which results in less tax; 3. Opportunity to pay taxes equally in tax years 2011 and 2012.
Major Fine Assessed Against “Trust Mill” in Landmark Case, The American Family Prepaid Legal Corporation and Heritage Marketing and Insurance Services, Inc. owned by the father and son team, Stanley and Jeffery Norman were hit up with $6.4 million in fines by the Ohio Supreme Court. This is a landmark case that is long overdue. The typical modus operandi is for the companies to send out thousands of post cards warning of huge probate costs. Those who responded were called to set in-home appointments by sales representatives. This was all done with the objectives of getting access to people’s homes, obtaining financial information and selling annuities and insurance products. Information for Living Trusts were sent to California, “Trust Mill” mecca, where Trust documents were completed and sent back to Ohio. The companies were found liable of pressuring senior citizens into buying prepaid legal services and annuities with threats and promises. The local bar association brought the case in accusing the Normans of unauthorized practice of law. Trust mills have been in existence in California for years with limited resistance from the California Bar Association. I have attempted to report several over the years with little or no success. Recommendations: 1. If you are contacted by a company for this purpose send my office a copy of the solicitation. 2. Do not allow sales representatives into your home. They should have a viable office in which you can meet. 3. Do not provide any financial information, including social security numbers, until you have checked them through their license number; received references from other clients they have serviced; visited their office; and have a comfort level with their approach. If you have a concern, contact my office. 4. Do not provide any personal information for estate planning services to anyone except a licensed attorney.
60 Minutes aired this unbelievable segment which indicated that almost 30% of older people were dying in hospitals, many in intensive care on machines. The cost to Medicare exceeded the U.S. costs of Homeland Security and the Department of Education combined. Amazing! The experts, including doctors interviewed, all agreed that if this regrettable process continues, it will bankrupt our country within a short time. One 82 year old patient who had signed a Living Will was dying of liver and heart failure. Yet she was given numerous tests and seen by 25 doctors. One of the tests was a pap smear. Unbelievable. Very rarely do clients sign forms in our office requesting life support to prolong life. The vast majority, in excess of 95%, do not want life support to prolong life when there are negligible benefits. The problem, it seems, are the following: 1. Families refusing to let go of loved ones even in the direst of circumstances; and 2. Hospitals needing to fill their beds to keep operating as an entity to make payroll and reduce the bond debt supporting their existence. First the families—there comes a time when we must let go of a loved one. As one of the intensive care supervising doctors stated on 60 Minutes, “To keep dying patients on life support and continued CPR is to extend their suffering.” Their body functions are winding down, mostly from old age, and the spirit is no longer there to live in that condition. Who in the world would want this? Apparently the families which is costing this country immensely. As the doctor indicated, fibrillators were being surgically inserted into patients with no chance of surviving very long at an alarming cost. Older patients were being supported by life support to obtain transplantation of organs in which many were too weak to sustain the transplant surgery. You have been given an Advanced Health Care Directive from our office in the signing of your estate planning documents. They include an Attachment A in which you provide a detailed guide for your health care agent as to how you wish to be cared for when you can no longer respond to your medical conditions. Insist that your agent and family members carry out your wishes. Talk to them—admonish them not to substitute their attempts in a denial state to preclude your wishes to allow death to be a natural life ending event. Death is part of life and should not be prolonged unless there is substantial medical reasons otherwise—it should not be based on the hopes of a loving child in denial of the inevitable. In accepting our life as terminal with its natural consequences, we are, in effect, enhancing the security of our country. We can no longer allow hospitals and intensive care centers to be filled with the dying elderly where there is no hope for survival. Most people wish to finally close their eyes in the comfort of their home surrounded by their families. I saw this many times over in my childhood with family members. I understand that the elderly need care but there comes a time when medical care can no longer benefit or prevent the inevitable. Not one doctor interviewed would have chosen life support in the condition of these elderly patients. As Andy Rooney would probably say in closing, “Folks, that should tell you something.”
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