Key Estate Planning Documents For Seniors

Key Estate Planning Documents For Seniors

By Ronald A. Fatoullah, Esq. and Elizabeth Forspan, Esq.

It is important for all individuals, especially seniors, to ensure that their estate plans and all the accompanying documents are in place so that they will be protected in case of death or disability. In this article, we discuss the essential planning documents that seniors should consider executing.

Power of Attorney
with a Statutory Gifts Rider

A power of attorney is a legal document that allows a person (the “principal”) to appoint another individual (the “agent”) to act on his or her behalf with regard to financial matters. As of September 1, 2009, a Statutory Gifts Rider must be signed together with a Power of Attorney if the principal would like to authorize the agent to make gifts or transfers in excess of $500 on his behalf. In the absence of a properly drafted and executed power of attorney, there is no one legally authorized to make decisions on behalf of individuals who become incapacitated and unable to make their own decisions. Thus, family members may be forced to initiate a costly, burdensome and time-consuming guardianship proceeding in New York Supreme Court. It is critical to consult with an experienced attorney to ensure that the Power of Attorney is drafted with sufficient authority to allow for estate and Medicaid planning in addition to other important powers. For example, if prepared correctly, the agent under a Power of Attorney may be given the power to create and fund a Medicaid Irrevocable Asset Preservation Trust for a parent in order to protect the family home and other assets. A solid power of attorney may also allow the agent to engage in various other types of estate, elder law and tax planning. We cannot emphasize enough the importance of this document. Of course, there can also be downsides to giving control over financial decisions to another person. For this reason, your attorney should discuss with you all the pros and cons of a Power of Attorney and the various powers it may (or may not) include.

Health Care Proxy

A Health Care Proxy is a document whereby an individual (the “principal”), appoints an agent to make substituted health care decisions on his/her behalf in the event that the principal is unable to do so. Health Care Proxies are governed by New York State statute. Generally, a Health Care Proxy empowers an agent to make any and all health care decisions on behalf of the principal. These decisions may include issues relating to medications, therapy, change of physicians, or any other matters that may arise in the course of medical treatment. However,

unless the agent is specifically instructed as to the principal’s wishes regarding artificial nutrition and hydration (feeding tubes), the agent will not have the authority to make such decisions. Thus, it is critical in the process of choosing an agent and executing a Health Care Proxy that an individual discuss his/her wishes with the agent. Further, the Health Care Proxy should reflect the fact that those discussions have taken place and that the agent is fully aware of the principal’s wishes.

Living Will

A Living Will is an advance health care directive that expresses the health care wishes of an individual. This document is used in conjunction with a Health Care Proxy to provide written instructions to the named agent as to the health care wishes of the individual (generally with respect to end of life decisions).  A Living Will is often used when there is a medical diagnosis of a persistent vegetative state with no hope of recovery. Those who are religiously observant may decide to execute a halachic living will which names a specific rabbi that must be consulted before any end of life decisions are made by the family and/or medical facility.

Last Will and Testament

A Last Will and Testament can help ensure that an individual’s assets pass to his/her intended beneficiaries upon death. These beneficiaries may include family members, friends, or charitable organizations. If a person dies without a Will, the assets that remain at the time of his or her death will pass according to the New York State laws of intestacy. This means that state law will determine to whom and in what proportions the assets will be distributed, which often leads to unintended consequences.  A Will is a complex legal document that can include various provisions depending on the testator’s specific situation. For example, an individual who has a child or grandchild with special needs may want to include provisions in his/her Will that will prevent the child’s inheritance from jeopardizing his/her government benefits. It is very important that all family issues and financial situations are discussed with one’s attorney prior to finalizing a Will.

Trusts

Trusts are useful tools that may be created for a variety of reasons depending on the needs of the individual. Trusts may be used for the purpose of avoiding probate, protecting assets, effectuating a Medicaid plan, reducing or eliminating estate taxes or to planning for a disabled individual. Trusts can be an effective way for the grantor, or the individual establishing the trust, to determine what happens to his/her assets not only during his/her lifetime but also after death.

 

The above outlines some of the key documents seniors and others may consider in order to effectuate their estate plans. Of course, one should certainly work with a knowledgeable and experienced attorney in order to create the best possible plan.


Ronald Fatoullah, Esq. is the principal of Ronald Fatoullah & Associates, a law firm that concentrates in elder law, estate planning, Medicaid planning, guardianships estate administration, estate litigation, trusts, wills, and real estate.  Elizabeth Forspan, Esq. is the Managing Attorney of the firm. The firm can be reached at: 718-261-1700, 516-466-4422, or toll free at: 1-877-ELDER-LAW or 1-877-ESTATES. Mr. Fatoullah is also a partner with Advice Period, a wealth management firm, and he can be reached at 424-256-7273.

 

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