Writing Your Tulsa Estate Planning Blog

Repeal of the Affordable Care Act has been one the biggest news items in recent weeks. Changes to Medicaid in Republican proposals have received a lot of attention, but many people do not know exactly what Medicaid does.

You probably know that Medicaid is the federal government program that provides health care coverage to poor Americans. However, in the debate about the repeal of Obamacare (Affordable Care Act) and possible reductions to Medicaid in various appeal proposals, what often gets lost is exactly what that federal government program for the poor does.

Facts about the program get lost in the media noise.

It is important to know the facts, because only then can you really decide if you are for or against any changes.

NPR recently published a list of some lesser known facts about Medicaid in “From Birth To Death, Medicaid Affects The Lives of Millions,” including:

•It is very expensive. Medicaid currently takes up approximately 10% of the federal budget. State governments contribute even more on top of that to the costs of the program.

•Half of all births in the U.S. are covered by Medicaid. The program has been expanded multiple times to include more and more pregnant women.

•Some 62% of nursing home residents have their care through Medicaid.

•Disabled people and the people who take care of them are often eligible to receive their care through Medicaid.

•Medicaid is a major source of funding for the fight against opioid addiction.

Reference: NPR (June 27, 2017) “From Birth To Death, Medicaid Affects The Lives of Millions.”

A Spanish court has issued an order to exhume the body of legendary artist Salvador Dali, almost a quarter of a century after he passed away.

Salvador Dali was well known both for his eccentric art and his eccentric lifestyle. He was not known to have any children, but one Spanish woman claims that she is likely Dali’s child.

The only problem is that she cannot prove her claims, since Dali passed away in 1989 at the age of 85.

The woman makes her living as a professional tarot card reader, so perhaps she could prove her paternity by reading the cards. However, she refuses to do such a self-reading. Instead, she has asked the Spanish courts to intervene.

A judge found enough basis for her claims, that Dali’s body has been ordered to be exhumed from its current resting place underneath a theater in Dali’s hometown so DNA testing can be performed, as the Washington Post reports in “Judge in Spain orders Salvador Dali’s body exhumed for paternity test.”

It is not clear what the woman hopes to gain from the testing. Dali’s estate has long been closed and all of his valuable artwork donated to the Spanish government.

Even though the artwork is valued at hundreds of millions of dollars, it is unlikely the woman could lay claim to any of that money. For her part, she seems uncertain of what she wants, if Dali does turn out to be her father.

She has only stated that she wants “what corresponds to her.”

It is not unheard of to reopen an estate or exhume a body to prove that the deceased had a previously unknown child. In this case, however, it probably is not going to do any good for the woman, beyond learning whether Dali really was her father.

Reference: Washington Post (June 26, 2017) “Judge in Spain orders Salvador Dali’s body exhumed for paternity test.”

The new fiduciary rule for financial advisers has caused a lot of confusion about what is and is not allowed with retirement accounts.

On June 9, a controversial new Department of Labor rule went into effect. The rule seems simple enough. Financial advisors who give investment advice to consumers about their retirement accounts, must act as fiduciaries of those consumers.

At least for attorneys, that is a very simple idea to understand.

Nevertheless, for consumers and their advisors the new rule has caused a lot of confusion, as the Washington Post details in “A new conflict-of-interest rule for retirement savers is causing a lot of confusion.”

The easiest way to understand what the new rule means, is that advisors have to act in the best interests of the people they are advising. Investment advice must be based on the best thing for the saver, not the advisor.

Therefore, if an advisor would earn a higher fee from suggesting one investment rather than another, he, or she cannot advise the saver on that basis. If the investment that pays the least to the advisor is better for the consumer, then that is the investment that must be recommended.

Many advisors are taking advantage of the new rule to make changes to how they manage retirement accounts.

The confusion surrounding the rule has given them the opportunity to make changes customers may not like and place the blame for them on the new rule.

If you are not sure if a change your advisor is making is really required by the new rule or if you should look for a different advisor, ask an estate planning attorney.

Reference: Washington Post (June 19, 2017) “A new conflict-of-interest rule for retirement savers is causing a lot of confusion.”

When it comes to estate planning, Americans procrastinate. However, it can only be put off for so long.

Even people who like to make detailed plans about everything else, are often tempted to put off estate planning for as long as possible. It is just human nature to prefer not to think too much about what will happen to our worldly possessions, after we pass away.

It can be difficult to imagine our things and our loved ones having a life after us. This leads to estate planning procrastination.

Truthfully, that is never a good idea. You do not know when you will pass away. It can happen suddenly and sooner than you want.

However, if you do procrastinate when it comes to your estate planning, you should know that the procrastination needs to end at some point.

This point was made by the Twin Cities Pioneer Press in “3 moves you should make in the first 3 years of retirement.”

If you have managed to put off estate planning until after you have retired from work, then now is the time to stop putting it off.

With any luck, you will still live many more years. On the other hand, estate planning is about more than just deciding what happens to your possessions and assets after you pass away.

It is also about securing your own final years and making sure you have powers of attorney and advanced health care directives in place, should you ever need them.

In the end, estate planning gives you peace of mind in knowing that your family will be okay after you pass away and that you will also be okay, should you ever need help.

If you have retired and still have no estate plan, then talk to an estate planning attorney as soon as you can.

Reference: Twin Cities Pioneer Press (June 17, 2017) “3 moves you should make in the first 3 years of retirement.”

People have a lot of false ideas about estate planning and how wills and trusts work. They should seek out people who do know what is correct.

We do not all like to admit it, but the truth is that we are all often wrong. Many of the things we thought were right, we later learn were incorrect.

Logically, that means many of the things we are “sure” about now, we will only learn to be less so later on.

There is no shame in this.

We cannot be experts in everything.

A physicist cannot be judged too harshly for getting the details of macroeconomics wrong, for example.

One area that many people are often very wrong about is estate planning, as pointed out in TCPalm in “Misconceptions about wills and trusts.”

The article mentions several things people are often wrong about when it comes to estate planning. What is specifically mentioned in the article, however, is not as important as understanding that you are probably wrong about estate planning.

You might not be wrong about everything that has to do with estate planning, but you are almost certainly wrong about more things than you think you are.

This suggests that you should not do your own estate planning.

You are wrong about some aspects of estate planning and you do not even know which aspects you are wrong about.

Consequently, you should seek out people who are experts in estate planning and those people are estate planning attorneys. Let them help you with your estate plan.

That would be the wisest thing to do, just as it would be wise for estate planning attorneys to seek out your advice in your line of expertise.

Reference: TCPalm (June 16, 2017) “Misconceptions about wills and trusts.”

Changes to New Zealand’s foreign trusts laws might show that using offshore trusts to hide assets is more prevalent than previously thought.

For many years, New Zealand has been thought of as a great place to hold foreign assets in trust. The nation had lax laws and allowed foreigners to have tax-free trusts with little oversight.

When the Panama Papers, the leaked emails of a law firm in Panama, were released, all that changed.

It was revealed that New Zealand was being used by some very wealthy people to hide assets from their own governments. This created some international pressure on New Zealand by other governments, as those other governments do not appreciate avoidance of their taxes.

In response to this pressure, the New Zealand government changed its trust laws. All foreign trusts were required to register, declare who controlled the trusts and declare who the beneficiaries of the trust were.

It was assumed this move would not be a burden for most foreign trusts, since there are many reasons someone might want to have a tax-free trust in New Zealand other than tax avoidance.

However, most foreign trusts have failed to register under the new law and many have fled the country, as the Wills, Trusts & Estates Prof Blog reports in “Trust the Kiwis.”

This suggests that using foreign trusts to hide assets is more common than previously thought.

Accordingly, government regulators will look for other ways to crackdown on trusts and make tax avoidance more difficult.

Reference: Wills, Trusts & Estates Prof Blog (June 20, 2017) “Trust the Kiwis.”

Senate Republicans are planning to hold a vote on their version of repealing Obamacare by the end of June. No one knows yet what their bill contains.

Republicans in Congress are moving forward with their plans to repeal the Affordable Care Act.

The House of Representatives previously passed a bill that would do just that. It would have cut funding for Medicaid and increased health insurance costs dramatically for many seniors who have not yet reached retirement age.

A Senate version is expected soon, as Politico reports in “Senate GOP prepares for Obamacare repeal vote next week.”

The biggest problem with the Senate bill from an elder law perspective, is that no one knows what the problems are.

Since President Trump is reported to have told Republican Senators in private that the House bill is “mean,” it is expected that the Senate version will contain some softer provisions.

However, the negotiations over the Senate bill are being conducted behind closed doors. It is also expected that no hearings or debate will be held on the bill before it is called for a vote.

That makes it difficult for elder law advocates to determine whether the bill is supportable or not.

When details of the bill are released, it will need to be quickly and thoroughly scrutinized from an elder law perspective.

Reference: Politico (June 20, 2017) “Senate GOP prepares for Obamacare repeal vote next week.”

The estate of a former Playboy model is suing a chiropractor for wrongful death.

One of the many tasks that the executor of an estate has, is to assess whether anyone owes the estate any money or could be determined to owe the estate money, if sued. If the answer to either question is yes, then the executor has a duty to act accordingly and try to collect on behalf of the estate for the benefit of the heirs.

A recent example of this comes from the estate of Katie May, a former Playboy model. May apparently suffered injuries during a photo shoot and went to a chiropractor for treatment.
The chiropractor worked on her neck. She later died.

The coroner determined the treatment injured her artery and cut off blood flow to her brain, as TMZ reported in “Playboy Model Katie May Estate Sues Chiropractor…Your Treatment Killed Her.”

May’s executor and the father of her child is suing the chiropractor for wrongful death on behalf of the estate. Even if he did not personally believe the coroner’s report that the chiropractor was responsible for May’s death, he would likely have an obligation to sue.

While this is an unusual case in that it features a Playboy model and an apparent death at the hands of a chiropractor, it illustrates something important. Executors have duties to the estate and some of those duties can be challenging.

It is for this reason that executors are advised to get the assistance of estate attorneys to help carry out their duties.

Reference: TMZ (June 14, 2017) “Playboy Model Katie May Estate Sues Chiropractor…Your Treatment Killed Her.”

There are two schools of thought for parents to wrestle with, when deciding how large of an inheritance they should leave for their children.

In a typical American family, the expectation has always been that when the parents pass away, everything they have left will be inherited by their children. Those children will, in turn, do the same thing for their children.

This is just the way things are almost always done and always have been done.

However, there is another approach to inheritances that a few people have always taken.

The second approach suggests that parents should not leave their children everything, because it will spoil the kids.

A recent article in Forbes is an example of this second school of thought.

The article is titled “Why Not To Leave Too Much To Your Grown Up Kids.”

The second approach comes from a belief that if children know they will receive large inheritances from wealthy parents, then they will have little incentive to make their own money. They will become entitled and lazy.

The thinking also goes that even if the children do not know ahead of time, they will become entitled once they do receive a large inheritance.

It is true that some people do become entitled when they know they will receive considerable wealth later.

Others do not.

The best solution for parents may be to take stock of the character of their own children and make a decision regarding what is best, given those characters.

An estate planning attorney can then help to create a plan that works, regardless what the children are likely to do or not do with their inheritance money.

Reference: Forbes (June 7, 2017) “Why Not To Leave Too Much To Your Grown Up Kids.”

Baby Boomer parents with millennial children should talk to their children about their inheritances. The millennials might be counting on larger inheritances than they will actually receive.

Sometimes differences between generations are greatly overblown. Small differences in the percentage of people in one generation that believe something different than a previous generation, get magnified and sweeping statements are made about the generations.

Sometimes there are big differences between generations that are of great importance.

For example, 61% of millennials expect to receive an inheritance from their parents that will help them in their own retirement.

That is roughly twice the percentage of Baby Boomers who think they will get an inheritance according to Financial Advisor in “Millennials Want Family Help in Retirement.”

Many millennials also expect to receive retirement help from their own children. Their other retirement expectations are often similarly unrealistic.

On average, they expect to retire earlier than they probably will and they expect to live fewer years as retirees than is likely.
These misconceptions combine into a big problem for the millennial generation.

By relying on family members and having unrealistic retirement expectations, they risk not saving enough money now. By the time they realize their mistakes, it might be too late to do anything to correct them.

It is important that parents of millennial children talk to them about setting realistic retirement and inheritance goals.

Do not let your children rely on an inheritance, if you know that they are counting on receiving more than they will. If you want to help your children in another way and leave them a larger inheritance, then visit an estate planning attorney to determine what options you might have.

Reference: Financial Advisor (June 6, 2017) “Millennials Want Family Help in Retirement.”