FAQS INCAPACITY PLANNING
Temporary or permanent incapacity presents difficult issues for you and your family. Incapacity planning reduces everyone's stress about important decisions. Many of the questions we hear frequently are answered below.
Durable Powers of Attorney are designed to make it possible for an agent to manage your financial affairs. For instance, your agent can be given the power to buy and sell real estate, write checks on your checking account, and sign your tax returns. The powers of the agent can be made effective immediately, or they can be “springing” which means that they become effective in the future if you become incapacitated.
Except to the extent you state otherwise, this document gives the person you name as your agent the authority to make any and all health care decisions for you in accordance with your wishes, including your religious and moral beliefs, when you are no longer capable of making them yourself. Typically, your agent’s authority begins when your doctor certifies that you lack the capacity to make health care decisions, but we can also design it so that the authority begins immediately.
A Directive to Physicians and Family or Surrogates (also known as an Advance Directive or a Living Will) is a document that is designed to communicate your wishes about the level of life-sustaining treatment you desire to be used when you are unable to make your wishes known because of illness or injury.
A HIPPA release is a document that identifies the persons who you will allow to have access to your health care information. This document is important due to a privacy law, known as the Health Insurance Portability and Accountability Act, which makes it difficult for anyone other than you to obtain this type of information.
A Declaration of Guardian in the Event of Later Incapacity or Need of Guardian is a document that states who is requested to be guardian if you should become incapacitated. This includes guardianship of the person (who determines matters such as whether to consent to medical treatment) and guardianship of the estate (who manages your financial affairs). You may also declare that you do not want a particular person to serve in that position.
If you don’t have an estate plan, the laws of your state and the court system will decide how to manage your affairs. If you become incapacitated, the court will appoint someone as the guardian of your “estate” to act on your behalf for your finances, like selling your car or your house. The court will also appoint someone to be in charge of your “person.” The guardian of the person will, for example, make medical decisions and decide which nursing home you should live in. The guardian of your estate or of your person may or may not be a member of your family. A guardianship can become expensive and time consuming, it is open to the public, and it can be difficult to end even if you recover.
If you die without an intentional estate plan, your assets will be distributed according to the laws of your state. In many states, if you are married and have children, your spouse and children will each receive a share. That means your spouse could receive only a fraction of your estate, which may not be enough to live on. If you have minor children, the court will control their inheritance. If both parents die (i.e., in a car accident), the court will appoint a guardian without the benefit of your guidance.
You have a choice. With a well thought out estate plan from an Austin estate planning attorney at Willi Law Firm, P.C., you can have matters handled privately by your family.
Imagine watching your loved ones trying to sort through your system of filing without your assistance. What if there was one file, your estate plan, where all of your financial records, titles, and insurance policies could be found if something happened to you? Imagine the relief they will experience when they see that you made things easy for them.
Planning your estate now will help you organize your records, locate titles, review beneficiary designations, and find and correct any errors. For example, errors on titles or beneficiary designations could create problems for your family when you are incapacitated or die. Beneficiary designations may now be out-of-date or otherwise invalid. Naming the wrong beneficiary on a tax-deferred plan can lead to devastating tax consequences. It is much better to take the time to organize and review this now than for your family to pay an attorney to try to fix errors later. With a thorough estate plan from an Austin estate planning attorney at Willi Law Firm, P.C., you will leave your family in the best position to handle your affairs without you.
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