The Slayer Statute in the News Again
Teen allegedly murders mom; mom was affluent; teen charged with murder; teen is poor but retains defense team; asks trustee, who is teen\’s brother for legal expense funds; brother says no; through lawyers teen sues estate to pay legal defense fees. Question: Will teen prevail in lawsuit? According to Illinois\’s slayer statute, it depends. The plain language of the statute provides that one cannot profit from causing another person\’s death: A person who intentionally and unjustifiably causes the death of another shall not receive any property, benefit, or other interest by reason of the death, whether as heir, legatee, beneficiary, joint tenant, survivor, appointee or in any other capacity and whether the property, benefit, or other interest passes pursuant to any form of title registration, testamentary or nontestamentary instrument, intestacy, renunciation, or any other circumstance. The property, benefit, or other interest shall pass as if the person causing the death died before the decedent, provided that with respect to joint tenancy property the interest possessed prior to the death by the person causing the death shall not be However, the operative word in the statute is \”causes.\” This means that the person must be first convicted of knowingly, without legal justification, killing another human being. Ms. Mack hasn\’t been convicted yet. So what may happen? The court may tell defense to bill but don\’t even think about collecting until the jury is in. The next issue is then whether Ms. Mack be able to keep this same defense team.
Protecting Families Globally…A Remarkable Colleague
Don\’t Try This at Home…Though the Law Says Differently
On September 24, 2014, the Illinois legislature enacted an amendment to the Illinois Power of Attorney Act. The Act was changed to “simplify” the healthcare power of attorney form. Estate planning attorneys in Illinois have been watching this legislation for a while, hoping that it would die. Unfortunately, it lives and the consequences we foresee are anything but simple. In fact, it looks like our legislature gave our citizens an early Halloween scare. The problem is that this can produce genuinely monstrous results: No standard form is required. So in medical emergencies, doctors must use their own judgment about legal forms. Huh? The notice page that makes the suggested format legal is FIVE PAGES long, which includes a litany of questions users are to ask themselves and presumably include answers to on their healthcare power of attorney “form.” Yeah, right. The form you use can be “included” or “combined” with the statutory property power of attorney. Doing so will allow your bankers to read all about your health concerns and your doctors can do the same with issues concerning your finances. Did our legislature forget about HIPAA? The changes removes actual provisions regarding choice of agent…OK…so that’s a tad misleading – that guidance is somewhere in that FIVE PAGE notice. What is optional in the form of your choosing is selecting quality of life over length of live, with some mention about pain. The changes remove language from the suggested format that reflects actual U.S. congressional privacy laws for medical practitioners and third parties. This language is now placed in the statute. Presumably, users will review the Illinois Power of Attorney Act, understand it, then read FIVE PAGES of notice, understand that notice, and create this legally sound, uniquely tailored form. Yeah, right. The form also provides that successor agents are “optional.” Not providing successors has always been optional, lawyers just didn\’t like saying so. We don\’t like telling folks about that particular option because not providing successor agents is tantamount to driving 70 MPH on a busy highway with no seat belt or airbags. Forget Frankenstein or Freddie Krueger, the new changes to the Illinois Power of Attorney Act are sufficiently scary and worse – they\’re REAL.
Not the \”Bump\” Couples Want…
High income households can strategically plan their income tax payments to better limit their Alternative Minimum Tax (AMT) liability exposure. The AMT structure differs from the regular tax system in that it subtracts fewer deductions and instead deducts one significantly larger exemption. This exemption phases out once a threshold is reached and as income increases. The AMT applies a tax rate of 26% on the first $175,000 of income and 28% thereafter. Households pay the AMT when a great tax liability results when using the regular system; thus, paying the AMT usually results in reduced marginal tax rates. However, as the AMT exemption phases out, the marginal tax rate increases and approaches a “bump zone” of tax rates. The marginal tax rates jump to 32.5% and 35% until the exemption completely phases out. After this, the marginal tax rate returns to 28%. Appropriate tax planning allows households to avoid “the bump” of rising marginal rates. Deferring income at the lower end will preserve the exemption taken. If income is higher, accelerating additional income to exit the zone and completely phase out the exemption would return the 28% marginal rate. However, accelerating too much income may subject a taxpayer to the regular 39.6% marginal tax rate instead of the 28% AMT rate. The phaseout threshold depends on the taxpayer’s state income tax rate and how much in excess AMT-adjusted deductions the taxpayer has. To maximize the AMT exemption and avoid the unwanted \”bump,\” taxpayers should consult with their tax advisor to discuss anticipated income and deductions in addition to identifying potential areas of liability. Timing can be everything. — Danielle Haseman, Team Max Elliott Law
A 90-Second Story on How Estate Planning Saves Lives*
Monday morning I typically share basic information about estate planning, hoping that someone will understand that it just isn\’t about planning for death. Yet, one also hopes that the plans you create don\’t go into effect until decades later but experience illustrates that is not the case. Then, this past weekend, into my inbox came an email from a former client, proving this very point: Estate planning is critical even if you have a very modest estate and even if you are young, e.g., late 20s. This is a scary story with a happy ending from a former client who gave consent to share. I share because my job is to protect and life is unpredictable. All personal identifying information has been removed and this sharing is consistent with what is allowed per the State of Illinois Rules of Professional Conduct and the American Bar Association Model Rules of Conduct. Hi Max, I hope all has been well with you… I recently had a medical emergency. Only because I have a living will and my medical providers have a copy of the document you prepare/instruct your clients to send to specific providers was I able to have my medical wishes honored. If I hadn\’t had you prepare my will, if my medical providers hadn\’t had a copy of the documents… I would likely be in an even worse medical situation. It was a horrifying experience… Thank you so much for preparing my will and for preparing the documents my medical providers needed in order to advocate for me. I only had you prepare my will in case I ended up dead or in a coma — I had no idea that the will could be life-saving while I was conscious and able to express my wishes. I am not exaggerating when I say that you helped save my life. This is a true story and why I love my job. *Having the appropriate documents in place doesn\’t always work, regardless of who prepares them. Yet, having some kind of plan is generally better than not having a plan at all.
Jennifer\’s Story – A Fiduciary\’s Tale, Part 3
If you’ve been following Jen’s story, you know that Bill’s, her father, condition was made worse by secondary emergency procedures instituted upon Alex’s, Jen’s brother, instructions to the ER doctors. This was an emergency; Jen was 30 minutes away; and the records were 10 minutes from being received by the ER. When the records arrived, it was clear from all of the advanced directives that Alex was not considered a fiduciary or personal representative. He was not to be given any information whatsoever. And as mentioned in the previous article, the information needed to prevent the complication that Bill suffered arrived 10 minutes after Alex had given the doctors the green light. In this case, because there was no third back-up to Jen and no way to contact her, the secondary steps taken could not have been avoided. The doctors proceeded with their hospital’s policy and that may not have been avoided even if Alex said he wasn’t a fiduciary. In emergencies, the difference between life and death can be seconds sometimes. So if Bill doesn’t fully recover or recover at all, the ultimate responsibility for his disability or death will likely sit with Bill for not naming a third back-up. The guilt will, however, rest heavily on Jen and possibly Alex. However, the doctor who spoke with Alex isn’t completely exonerated. Once the doctor saw who was designated on the advanced directives, which included the HIPAA forms, to receive Bill and Carla’s personal health information, the doctor should not have had any further conversation about Bill’s condition with Alex. Nevertheless, he continued speaking with Alex and sharing Bill’s medical history, contrary to law. Privacy provisions under HIPAA prohibit sharing personal health information with anyone, even next of kin, unless the person is designated as a personal representative on the form. Needless to say, Jen became even more distraught when she spoke with her attorney. Now, Alex has faded into the ER waiting room background and Jen is visiting with Carla, whose condition has improved to stable. Jen can’t tell Carla about Bill though and is contemplating the worst case scenario for Bill. Still, as Jen sits quietly while Carla sleeps, Jen reviews one document that provides a sliver of peace of mind at least for her parents, though the doctors probably won’t understand. But they don’t have to; families have their own overall personalities as these doctors will find out and the law is the law. More to come… Jen\’s Story – A Fiduciary\’s Tale, Part 1 | 2 | 3
Jennifer\’s Story – A Fiduciary\’s Tale, Part 2
If you recall from Jennifer’s Story Part 1, Jennifer’s parents, Bill and Carla, were in a terrible car accident but had healthcare powers of attorney on file with their primary hospital and had designated each other as primary agents, and then Jennifer as the tertiary successor agent. Yet, no agent was listed as a back-up for Jennifer who was unavailable at the time of the accident. Bill and Carla were taken to the nearest hospital and were in critical condition upon arrival. Emergency measures had to be instituted immediately. Fortunately, Bill had his cardiologist’s card in his wallet. Also, Carla’s primary care doctor practiced in the same hospital as Bill’s cardiologist. However, both doctor’s were not in the hospital during the time of the accident; so they were being paged. Jennifer’s estranged brother, Alex, learned about the accident from his grandmother and went to the hospital post-haste. Accordingly, the hospital, when faced with an emergency where the agent is incapacitated and the successor agent is unavailable, followed its standard policy and began consulting with the “next of kin,” Alex. The doctor described the situation to Alex and the fact that Bill probably had a heart condition. Alex told them to do whatever they thought was best. This was 30 minutes before Jen’s arrival. When Jen entered the ER, she came upon the doctor explaining to Alex that the medication initially administered to Bill caused a severe reaction and, consequently, more emergency steps were needed to arrest the seizure. The seizure had subsided and Bill’s medical records had also arrived. However, damage to Bill’s heart was a great likelihood, as his blood pressure skyrocketed before and during the seizure. Furthermore, the seizure had made the overall stability of his condition much worse. Jen knew that certain medications would trigger this seizure and the information was, in fact, on his healthcare power of attorney. However, this was an emergency. Still, what if her father doesn’t fully recover? Who is responsible? Jen is about to ask and learn… Stay tuned… Jennifer\’s Story, A Fiduciary\’s Tale, Part 1 | 2 | 3
Love & the Law: A Polar Vortex Campfire Tale
Updated May 27, 2023 Amidst Polar Vortex 1 of January 2014, a group of wonderful folks and yours truly sat around a warm office, invited by IntraSpectrum , discussing LGBTQ relationship rights. I introduced them to my series Love & the Law, here, as briefly as I could and we had a great time. So, really, what does all of this mean? Well, my (former) rockstar intern, Emily Welter, boiled down my hefty remarks into a few poignant and fabulous images and take-aways: The equality fight then The equality fight later… and… DOMA … and … WINDSOR and … SCOTUS… and POTUS… OH MY! Much like Dorothy and her gang, our Nation’s lawmakers followed a harrowing yellow brick road to marriage equality for over 50 years. We have come a long way from the 1966 case of Loving v. Virginia and we made positive strides towards that “Emerald City” of equal love. Below are 8 key points to know about the legal changes that took place in 2013 – aka the “Watershed Year” – which have affected Estate Planning for today’s LGBT couples: Several States passed marriage equality laws; SCOTUS (\”Supreme Court of the United States\”) ruled in favor of lesbian surviving spouse, Edith Windsor; SCOTUS ordered the IRS to treat legally married same-sex couples the same as straight married couples; The IRS mandated equal treatment of legally married LGBTQ couples for all tax treatment; The IRS called employers to issue FICA refunds to legally married LGBTQ couples; The IRS called on other agencies to comply with the new IRS rules; USCIS removed its barrier to legally married LGBTQ immigrant spouses; AND, finally Illinois passed same sex marriage(!); SCOTUS ruled in favor of marriage equality in Obergefell v. Hodges; and President Joe Biden signed the Respect for Marriage Act, repealing DOMA and helping ensure marriage equality for all U.S. persons.
Jennifer\’s Story – A Fiduciary\’s Tale, Part 1
Fiduciaries are individuals who are held to a higher standard of legal accountability than others with whom folks may enter into agreements. The high standard is attributed to fiduciaries because usually they\’re responsible for making very important decisions or taking critical actions on behalf of others. In Estate Planning and Estate Administration, professional fiduciaries help families and individuals create and implement plans that will protect their interests. Professional fiduciaries include bankers, lawyers, financial advisors, doctors, and accountants. So, the interests these important folks protect involve money, one’s life, or confidential information about the same. The information you share with professional fiduciaries should be considered and treated as trusted confidential information, to be shared with only those individuals you expressly authorize to receive the information. If that trust is not respected, i.e., breached, because fiduciaries are held to a higher standard of accountability, the professional usually can be hauled into court. The down n dirty scoop on fiduciaries can start with Jennifer\’s story*: Jennifer was visiting her grandmother when she learned that her parents were involved in a horrible car accident. Jennifer flew back home immediately, heading to the hospital directly from the airport. At the hospital, she was informed by one doctor that both parents were placed in a medically-induced coma. Additionally, her brother, Alex, who had been estranged from the family for 10 years was standing in the ER speaking with another doctor. It was clear to Jennifer that the doctor had presumed Alex had authority to make decisions for her parents and was providing Alex with information about her parents health. When Jen asked the doctor why he was sharing information with her brother, the doctor informed her that the nature of the situation required the medical staff to engage with the next of kin to determine and obtain permission for urgent care and treatment. Yet, was that legally the case? Jennifer’s parents had healthcare powers of attorney on file with their preferred hospital. However… Stay tuned… Jennifer\’s Story – A Fiduciary\’s Tale, Part 1 | 2 | 3
Our Readers\’ Top 5 Articles from 2013
Like most, The Shark Free Zone took a little time off to reflect over last year’s work and our readers’ preferences. So before the “reflection” month of January is over, below are the top 5 articles from 2013. Enjoy! NUMBER ONE. The popularity of our top article for 2013 may have had a little to do with its melodramatic title, “Infants, Stairwells, & Burning a Million Dollars.” The premise was less dramatic than the title, but still important: If professionals or smallbiz owners fail to protect their assets by not planning, they might as well set their income and belongings on fire. Of course, we’re not advocating arson, but if someone slips and falls on your property or a toddler visiting with Mom finds his or her way into a non-child-proof cabinet, oh woe… Click here to read the star of The Shark Free Zone for 2013 and feel free to pay it forward. TWO. \”What the Civil Union Means…to Many,\” was a spillover all the way back from 2011, providing useful information on LGBTQ couples considering or entering into Illinois Civil Unions. It\’s continued popularity was likely because it resonated with many concerned about the economic benefits that can be reaped when discrimination ends. It’s a somewhat moot now that Illinois has passed the Religious Freedom and Marriage Fairness Act, providing marriage equality to Illinois LGBTQ couples. However, the article has many relevant points, so you can read it here. Our article on marriage equality in Illinois is forthcoming, so stay tuned! THREE. Smack dab in the middle is our series, whose information, is rising to the top of the news charts as more statistics and reports are being shared daily about the large aging Baby Boomer population. We first mentioned the Baby Boomer issue, or “Silver Tsunami,” a few years ago. It is now abundantly clear to all advisors that almost everyone is or will be affected by the Boomer generation, especially families that are unprepared. Don’t get caught by the Boomer wave. Prepare for the Silver Tsunami by checking out this middle entree. FOUR. Fourth in last year’s popular articles again involved marriage equality, particularly DOMA’s undoing. Our series, “The IRS Takes a Bite Out of DOMA” highlighted the complex estate and financial planning machinations LGBTQ couples had to take before the U.S. Supreme Court’s ruling in U.S. v. Windsor and the subsequent IRS ruling 2013-17 that removed a lot of that complexity for legally married LGBTQ couples, and especially those in \”friendly\” states. Tap here to read the beginning of this important 4-part series. FIVE. Rounding out our top 5 is “The Money Talk.” Recently, a relative became engaged, which will likely happen with many couples next month on Valentine’s Day. As couples take this loving step, it’s critical to know and understand each other’s mindset as it relates to saving, spending, investing, charitable giving, and a host of other related issues. So before you say “yes” or consider putting a ring on it, consider having this conversation. So there you have it: The top interests of 2013 were about love, money, and justice. What else is there to be interested in, except a pair of good looking shoes, right?