What Happens If You Become Incapacitated Without A Durable Power Of Attorney
A General Durable Power Of Attorney is an estate planning document that is meant to be in place for if you become incapacitated or disabled and are no longer able to speak for yourself or carry on your financial affairs. The durable nature of the power of the attorney comes into play when a trusted person that you name in the document steps into place for you to manage your assets and handle your affairs for you until you recover or for the rest of your life. What happens if you do not have this important document in place and you become disabled or incapacitated and are no longer able to act on your own behalf?
If you become incapacitated in most states without a General Durable Power Of Attorney in place for yourself then the Probate Court in your county steps in and decides who would be the person to handle your affairs that would have named in your power of attorney if would have properly made one. The probate court in your county of residence most likely must appoint both a Guardian and Conservator for you. A Guardian is appointed to look after your health and well-being and make decisions that are in your best interest of your person. A Conservator is appointed by the Probate Court to look after your money and make sure that you are not being taken advantage of financially. The conservator must file strict accounting reports with the Probate Court and will most likely have to post a bond in case any money is mishandled. This process can be extremely costly and drain your assets before you get to enjoy them again after you regain capacity or pass them on to your loved ones.
In Most States It Takes Work To Disinherit a Spouse
The goal for some in a marriage is to make sure that the person they marry gets no inheritance from them when they die. This goal may seem harsh at first glance, but there may be good motivations behind it such as already having kids from previous marriage, a significant age difference in spouses, or wanting to give everything to charity. Whatever the reason it takes work to leave a spouse with nothing in most states and cannot be done with a simple will.
If you live in one of the community property states, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin, there is little that can be done to disinherit someone you are married to. In these states the spouse will most likely receive half of the estate regardless. If you live in one of the forty other states you can disinherit, but it will take some work. In most states you may disinherit your children or other family members very easily by just making a simple will, but your spouse is a different story. In these states just because you name your spouse in a will and do not leave the spouse anything or set up a revocable living trust and leave the spouse out of it does not necessarily mean the spouse will not get any of the estate. In most states there is a statutory elective share that allows the spouse to claim a percentage of the probate estate and maybe even assets in a revocable living trust.
You Do Not Have To Leave A Dollar To Disinherit In An Estate Plan
There is a popular misconception that is part wives tale part urban legend that the best way to disinherit someone, particularly a child, is to leave them a dollar in your will. The will in this case usually contains a provision such as “I leave a dollar to my child”. Leaving a dollar in a will is probably the worst way to disinherit someone from a will and is totally unnecessary.
There are still a large number of wills that do contain a bequest of one dollar to a loved one. The thinking behind this concept is that by leaving a dollar to a person in a will, you keep the person named from inheriting any more than that amount. It is true that the person named will only receive a dollar and nothing else as an inheritance, but it is unnecessary. This is the equivalent to using a bazooka to swat at a fly when the fly swatter would have been easier and much more appropriate response for the situation. When making a will it is best to choose the path of least resistance. Some unknowingly choose the path that will cause resistance and heartache.
There is a simple alternative to leaving a bequest of a dollar in a will. The alternative is simple as not naming that person in the will at all. It is only necessary to make a will after that person is born or name that person in the introductory clause in your will and make no further bequests to that person disinherit them. A simple acknowledgement in the introductory clause of the will says that you know this person is a family member or loved one, but that you choose to not leave them anything in the will or outside of the will.
Methods to Safeguard Inherited Property and Lessen Family Disputes
Have you ever inherited property from a deceased relative? If so, chances are it was a bittersweet process. One on hand it’s great to have items that belonged to a loved one, but on the other it’s sad they are no longer around.
There’s little doubt receiving inherited assets can better your life, especially when it’s lump sum cash or valuable property. However, being a beneficiary can sometimes result in family disagreements that lead to inheritance wars.
As a probate liquidator, I spend a lot of time in courtrooms to buy assets sold through auctions. There are many reasons estate agents sell assets. The most common is to sell property to pay off decedents’ outstanding debts. Another is to cover costs of legal fees caused by heirs contesting the Will.
When family disputes over property occur there is probability that heirs will initiate a lawsuit against the estate. I’ve sat through enough court sessions to realize there are times when heirs truly were entitled to valuable property that wasn’t bequeathed in the Will. I’ve also witnessed many frivolous claims that did nothing but destroy family relations and bankrupt the estate with legal costs.
While writing a Will is one of the best methods for safeguarding inheritance gifts, there is estate planning strategies that can reduce risk of having the Will contested. A few well-known methods include: inserting a no-contest clause within the Will; transferring assets to a trust; and setting up assignment of beneficiaries.
A no-contest clause essentially claims that if heirs contest the Will they agree to forfeit any property gifted to them. A more drastic measure is to insert a disinheritance clause which explains why the heir was written out of the Will. Most people would never think of disinheriting a relative, but there are times when it is necessary.