Asset Protection ~ Facts & Fiction
Recently, I read a column that suggested asset protection strategies should be used by those with modest estates. While I appreciate the premise, I respectfully disagree. Asset protection strategies used by high-net worth or ultra-high net worth individuals require a substantial investment in resources – specifically time and money. Most families with modest estates don’t have $2-5 million in liquid assets, a mortgage free million dollar primary residence, a second vacation home, watercraft, and insurance to cover the value of all of these assets. Let’s be real, if: (1) Your family residence is still subject to a mortgage, you don’t actually own the asset to protect. (2) You own 1 or 2 multifamily income producing properties that are still subject to mortgage, you don’t actually own the asset to protect. You do, however, own the income, which is what umbrella insurance and LLCs are for. (3) You don’t have the funds readily available to replace your mortgage-free family home, the only way to protect that asset is with a robust homeowners insurance policy. Economic uncertainty is frightening. And ways exist for families with modest estates to protect what they have and undergird their wealth accumulation efforts. However, if you’re thinking about asset protection consider the above and think again: AFFORDABILITY. The legal fees alone are generally $10,000 or more, and they generally do not end because asset protection or wealth preservation is not a “set it and forget it” endeavor. CURRENT JURISDICTION. All states (or jurisdictions) don’t allow you to establish an asset protection plan or recognize asset protections trusts. IT TAKES A TEAM. Lawyers, tax professionals, appraisers, insurance professionals, and, even, security professionals depending on your other family members and the size of your estate. Experienced estate planning and wealth preservation professionals will do what they can within legal parameters to set you and your family up for success. But, it’s not like the movies and if a wealth preservation professional snaps their fingers and agrees with everything you say, run…fast…and far.
High-Wire Acts & Estate Planning
“If you look down, what you see may not be legally binding.” Like most people, I listen to podcasts on a regular basis. One episode heard lately had absolutely nothing to do with the law, but mentioned the issue of “informed consent.” That led me down the legal rabbit hole considering my duties as a lawyer with potential clients. Every time I or one of our associate attorneys meets with a potential client, we must obtain their informed consent to provide them with legal services. And what exactly is informed consent? Ensuring that our potential client has the requisite mental capacity to take the steps they want to take. For example, the capacity needed to establish a Last Will and Testament requires that a potential client knows what they have and its approximate value, who their heirs would be, what they want to do with their estate assets, and understands the consequences of the distribution scheme they have in mind. Next, they must have accurate knowledge related to the services they are seeking. Using the Will as an example again, a potential client must know that an estranged spouse, can, in Illinois reject the Will and take 1/3 of the Estate. Related to the two elements above, a potential client must then understand the implications of their actions, like establishing a Will that disinherits an estranged spouse or doesn’t mention an estranged spouse. Can you say probate? Oh,..and then we have to explain what that is. After all of the above, the potential client then must have the freedom to say “no thank you” to our pitch. If Junior is sitting next to Grandma whispering in her ear and Grandma says reluctantly, “Ok. Who do I make the check out to and give everything to Junior,” Houston, we could have a problem. Finally, Grandma must provide us with the authority to prepare the Will. If Grandma says, “sounds good,” I’ll talk to my family and walk away. Grandma hasn’t given us authority to do anything. Now… I’ve a few questions: (1) When you sign up for one of the online platforms, are you providing your informed consent? (2) And if so, to whom? (3) What AI program or online platform took and survived the bar exam? I love technology, but leaving issues involving family and money to something that is artificial and has no real world experience in probate courts is a high-wire act, to say the least. Need a Review Of Your High-Wire Estate Plan
We Were Surfing, Then a Shark Ate Her
What Happens if You Die Without a Will While On Vacation? It was going to be the best honeymoon ever. We met a couple of years post-divorce for both of us, and fell madly in love with each other and each other’s children. We were financially secure and each of us had our own wealth and intended to keep our assets separate. The water was beautiful and blue and the waves were amazing. We went out on our boards and out of nowhere appeared a grey fin, an ugly snout, and then menacing black eyes. She freaked out, fell off, that thing opened its snout, showed teeth, and the center half – 1/3 – of my new wife’s body disappeared. Then all hell broke loose. We had quickly prepared powers of attorney prepared before we left and were planning to have an estate plan prepared by an attorney once we returned. My wife was particular about how she wanted her remains disposed – she wanted to be buried in the most sustainable and economical way. At the hospital, researchers appeared and refused to release her body. Unlike our home state, in this state, doctors were the final decision-makers on dispositions of remains. So I had to leave her remains in a strange place. I’m also going to have to pay thousands of dollars to a healthcare system because we didn’t have traveller’s insurance. When I returned home, I learned that some of her accounts had no designated beneficiaries, so instead of everything going to her children, her children will have to split everything with me. When they found out about that, they began blowing up my cell phone asking me what I intended to do. Of course, I intend to give them the 100% of my share but one of them is a spendthrift – money burns holes through their pockets and my wife was adamant about being careful how much to give to this child on a regular basis. That has caused some friction between all my stepchildren. Also, since my wife had no Will or Trust, her estate must go through probate. In this state, because I’m the surviving spouse, I have preference in acting as an administrator for her estate. This issue also created discord between me and my stepchildren. That frickin’ shark! I think what I’m going to do is use part of my half to create a trust for the spendthrift child to shelter at least part of their share of the estate, and they are not going to like that, but I know it’s what my wife would have wanted. She would have been very upset with the fact that this kid, who she actually suspected as being a functional addict, is going to obtain 1/6 of their share completely outright. I really hope the kids don’t blow through their inheritance; they are still young adults, just a few years out of college. Her estate was rather large, so I also must obtain insurance to cover the value of her estate, which cost the kids thousands of dollars. My wife was also working with a tax professional because she also had a significant tax liability that they were disputing with the IRS. That means I can’t distribute her estate to the kids (or anyone else) until that issue is resolved. How am I going to explain that to the kids? Maybe I can provide a partial distribution, but I still need to have some appraisals done – she owned a couple of rental properties and a small online business. I really miss her – she was fun but brilliant. This is a mess… And a fictional story…kinda
Changes in New York’s Power of Attorney
Changes in New York’s Power of Attorney By Max Elliott October 4, 2023 Author Gabrielle Wasenius Laws always evolve. Here at the Law Offices of Max Elliott, we stay current on estate planning, estate administration, and probate laws of the jurisdictions we serve. The laws related to the New York Power of Attorney (POA) underwent significant changes in 2021, bringing more flexibility for those preparing POAs and greater safeguards for those relying on them. One notable improvement is that the POA no longer requires an “exact wording” match but only wording that that “substantially conforms” to the statute. Previously, even minor typos or small mistakes could invalidate POAs. While the wording requirement changed, the fundamental rule that an agent’s powers are limited to those listed in the POA remains unchanged. However, the new law allows for more powers to be granted to agents, especially regarding gift-giving. Before the law changed, an agent could only make annual gifts of less than $500 unless the principal initialed a section of the POA to grant authority to the agent to make larger gifts and then also executed a separate Statutory Gifts Rider. The Statutory Gifts Rider had to be notarized and signed by 2 witnesses. These requirements were meant to combat fraud and abuse. But, requiring 2 forms created confusion. While POA forms properly executed under the law in effect at the time of their signing remain valid, the new POA law eliminates the Statutory Gifts Rider completely and allows for gifting provisions to be included in the POAs Modifications section. It also includes a standard provision allowing up to $5,000 in gifts per year, with the option to specify other amounts in the document itself, specifically in the Modifications section. This significantly simplifies the process. The new law also makes POAs easier to use. The law ensures that third parties like banks cannot reject a properly executed POA without good cause, and the statute provides a specific timeframe for them to do so. If they unreasonably refuse to recognize the agent’s authority, they may be held responsible for damages and reasonable attorney fees and costs by a court. The law also protects those who rely on POAs. The safe harbor provision shields third parties from liability if they act in good faith, even if the POA turns out to be invalid. However, for this protection to apply, the POA must appear to be executed correctly, and the recipient must not have actual knowledge of forgery, voidness, or misuse of authority. This provision does not protect parties involved in fraudulent activities. These legal changes in the New York POA make it easier for agents, principals, and estate planning attorneys to work within the system. A well-prepared POA, along with other advanced directives, can provide valuable protection when needed. Don’t wait until a crisis; start planning today for a more secure tomorrow.
Navigating Florida’s Perilous Spousal Estate Inheritance
Navigating Florida’s Perilous Spousal Estate Inheritance By Max Elliott October 25, 2023 Contributing Author: Nicole Page Florida law provides significant protection to surviving spouses who have been disinherited or left a small share by their deceased spouses. In Florida, a spouse cannot be disinherited by a will or a trust, which is different than Illinois, where a spouse can be disinherited by using a trust. Florida law gives spouses the option to choose to inherit what was left to them according to their deceased spouses will or the choice to elect to receive a percentage of the elective estate. A surviving spouse usually elects to take an elective share in situations where the deceased spouse attempts to disinherit them or leaves them less than they would receive if they took an elective share. The amount of the elective share is a case-by-case analysis, depending on the value of the estate. There is no fixed number, but rather a percentage – up to 30% of the deceased spouse’s estate. It’s also important to note that some assets that aren’t typically a part of an estate are considered to determine the surviving spouse’s elective share. This means that an attempt to circumvent the elective estate statute by distributing assets into a trust may still not be sufficient to disinherit a spouse. Florida does not discriminate by codifying what type of character the spouse had or the nature of the relationship between the spouses. This means that even if the spouses have been living separately for years, it does not infringe on the right to the elective share. As long as the spouse is a Florida resident and still married at the time of the death, they can claim the elective share. Barriers to claiming the elective share are: Executing a valid premarital or postmarital agreement. Required procedural protocols: The surviving spouse must file a written notice that they are invoking the elective share statute with the probate court within 6 months after the date of service of the notice of administration or 2 years after the date of the decedent’s death. Still, if you would prefer to provide for your children because you’re in a second marriage, beware of what’s lurking beneath…
Attention NY Legal Professionals: Smoother Sailing Ahead for Obtaining Sworn Statements
Attention NY Legal Professionals: Smoother Sailing Ahead for Obtaining Sworn Statements By Max Elliott April 3, 2024 By Gabrielle Wasenius In New York, attorneys have traditionally been permitted to submit affirmations to courts instead of affidavits, the law controlling this practice, CPLR 2106, removed the prior mandate for attorneys to acquire a notary public’s oath before presenting their sworn statements. The CPLR drafters believed that attorneys’ professional responsibilities and the potential for prosecution for false statements were adequate safeguards against dishonesty, thus eliminating the necessity for a notary public. Additionally, the law allowed specific medical professionals to affirm the veracity of their own statements. In 2014, CPLR 2106 was amended to permit affirmations instead of affidavits from individuals located outside the United States, Puerto Rico, the United States Virgin Islands, or any territory under U.S. jurisdiction. This change sometimes made obtaining a statement from someone overseas than from a person in a nearby state easier. On October 25, 2023, Governor Kathy Hochul signed two laws amending CPLR Rule 2106. Effective immediately, A06065 / S02997 expanded the scope of who can make affirmations in civil actions to include all licensed healthcare professionals. Effective January 1, 2024, A05772 and S05162 allowed affirmations in lieu of affidavits to be made by any person in a civil action. The new law applies to both new legal actions initiated on or after January 1, 2024, and to actions that are still pending as of the effective dates. Now, a statement made by any individual and affirmed by that individual as true under penalty of perjury can be used in a legal action in New York as a substitute for an affidavit, with the same legal weight. The affirmation should contain this language: I affirm this ___ day of ______, ____, under the penalties of perjury under the laws of New York, which may include a fine or imprisonment, that the foregoing is true, and I understand that this document may be filed in an action or proceeding in a court of law. (Signature) Keep in mind, the new CPLR 2106 does not eliminate the need for notarized affidavits and affirmations entirely. Notarization will still be required in cases where the law mandates the declarant to verify their identity or the document’s authenticity. Nonetheless, this amendment modernizes New York law, aligning it with practices in more than 20 other states. It will reduce the burden on litigants, witnesses, clerks, and courts. Moreover, it helps to overcome logistical and financial barriers, like trying to obtain a notarized document from a non-New York heir who is party to a New York action. Hopefully, this change reflects New York’s dedication to adapting its legal system to meet contemporary needs and challenges.
Our Country…‘Tis of Thee
Our Country… ‘Tis of Thee January 20, 2021 WE ALL KNOW that the American ideal of democracy is just that, an ideal: People are citizens of this country, the United States of America, who the Founders never imagined would be granted citizenship; people in this country, regardless of the color of their skin, are considered equivalent in Black Letter Law, at our very least attempt at justice and in the spirit of the law at our very best, which is something many founding persons never believed should be; and most citizens in this country are endowed with the authority to cast a ballot for whom they believe represents their interests, which is an authority that many of the Founders disagreed with bestowing upon the “common man,” let alone woman. That American democratic ideal, however, did not really begin to take shape as a force to be reckoned with until the Voting Rights Act was passed; until the Honorable Justice Thurgood Marshall took his seat upon United States Supreme Court followed by the Honorable Justice Sandra Day O’Connor; and until Barack Hussein Obama was voted in as the 44th President of the United States. That American democratic ideal was most recently tested to its core by an attempted insurrection of the United States government, and like the administration that lifted the insurrection, the attempted insurrection should not be viewed with dismissive side-eyes. It is telling that a large percentage of this country is sufficiently, miserable, un- or misinformed, and fearful that they would risk decapitation of the only body that ever kept most enemies from their doors and their shores. That American democratic ideal is assuredly injured. And, yes, this isn’t a cumbaya moment. It isn’t a moment to breathe a sigh of relief. It is a moment to inhale, hold it, feel the American heartbeat, hear the American lungs, and exhale, slowly, ever so slowly, and note the American body politic’s response, and get to work, to recover and move forward and strengthen that American ideal. Still, we may not be breathing a sigh of relief, but that does not mean there is no relief being felt and seeking to be shared because… That American ideal… MY country ‘tis of thee…lift EVERY VOICE AND SING…from SEA to SHINING SEA… let FREEDOM and JUSTICE for all…ring.
And We Rise…Together
And We Rise… Together January 9, 2021 https://maxelliottlaw.com/wp-content/uploads/2025/06/2021-Horizons-and-Hopes.mp4
Dad’s Inheritance Is at the Spa
Dad’s Inheritance Is at the Spa November 9, 2022 Most people incorrectly assume that if someone has a Last Will and Testament, then the Will captures everything the decedent owns and probate is not required. If this were correct, the lives of probate lawyers would be a lot easier. Often people pass away with a Will or a Trust not accounting for a legatee (someone who inherits under a Will) or beneficiary that might predecease them or not referencing a bank account here or there or thinking that they have “time” and will deal with the real property “later.” But “later” never comes. And the result is usually very unhappy executors, successor trustees, and beneficiaries. When a loved one dies intestate, that means they die without a Will or Trust or having designated beneficiaries to all of their estate. And what is an estate for inheritance purposes? An estate is everything the decedent owned outright, with no other person, at the time of their death. Occasionally, minors inherit estates. Sidebar: A minor is a person who has not reached adulthood or “age of majority.” When a minor inherits from an intestate estate, guardianship or conservatorship is usually required. And to make matters even more complicated, jurisdictions and government agencies disagree on the precise definition of minor. For example, some states specifically define a minor as a person who is 16 years of age or older, other states, such as Illinois, specifically define a minor as someone who hasn’t reached age 18…but a state agency has determined that a minor is someone who hasn’t reached 21. Next, let’s say the child’s parent died with a 401k that has no designated beneficiary. According to Illinois law, the child is an adult and would be an heir able to inherit the 401k, provided no other issues would impede their ability to do so. And no guardianship would be needed. Sidebar: I am not suggesting an 18 year-old inheriting $50,000 without guidance is a good thing. Oh contraire… And, according to the most updated SECURE Act provisions, which governs inheritance of retirement assets, an 18-year-old child is a minor for purposes of inheritance. Furthermore, since the SECURE Act is Federal Law, with respect to the inheritance and federal law supersedes state law, does that also mean that the 18-year-old child will need a guardian? State law says no, but the decedent would likely be rolling over in their grave I’m sure. Because…this hasn’t been tested in the courts yet. And if the decedent had a surviving spouse, what can that spouse do? Say, “No, surviving child, I know the state court says you can take the lump sum of $50,000 now, but please don’t use it to buy that Rolls.” This scenario occurs more often than one imagines. Oh, how I do wish our government agencies talked with each other… In the interim, the surviving spouse should probably make sure the 18-year-old has a very good driving instructor and lots of car insurance…
Highlights Return!
Highlights Return! January 25, 2023 https://maxelliottlaw.com/wp-content/uploads/2025/06/2023_Highlights_Horizons_Final.mp4