Iowa Estate Plan

First and foremost, I don't handle divorces and won't go further with any divorce questions because my knowledge ends with that.  In 20+ years of practice, handling a divorce 20 years ago was good enough to put away those materials. But for those that have gone through a divorce, there is typically the question about how a divorce impacts your estate plan documents.  The Iowa legislators realize that many people don't go through the process to update their estate plans after a divorce, so they have implemented a series of code sections throughout the Iowa Code that essentially provide that if you get a divorce, any provisions that provide for your beloved "ex" are ignored.  Those various code sections are consolidated here to help you sleep a little easier at night: Iowa Code section 598.20A provides that if you list your ex-spouse (or relatives of your ex-spouse) as your beneficiary of life insurance, that designation is ignored. Iowa Code section 598.20B ...

It is hard to believe that my oldest daughter is heading off to college this week at Drake University .  I'm excited for her as she starts this next journey in her life.  In addition to getting all of the necessary supplies, such as towels, laundry bags, books, pepper spray, etc., it is also important that parents of college-bound kids have the kids sign power of attorney documents .  While we may still think of them as young kids, the fact is that under the law, they are legal adults and entitled to full and independent control of their financial information/assets as well as medical decisions and privacy protection.  This is regardless of the fact that you as the parent may be paying their tuition and treating them as a dependent for tax deduction purposes.  However, it can be extremely beneficial to have your child sign a power of attorney document so that you are authorized to: obtain medical information and consent to medical procedures if necessary; a...

A financial advisor recently reached out to me regarding the impact of a Power of Attorney document concerning financial matters.  In particular, the question was whether the person signing the document (the "principal") loses any power or authority once they sign the POA document.  As a reminder, the default rule ( and recommended direction in my opinion ) is that the agent's power is immediate upon signing.  In other words, it is not necessary to wait until the principal is incapacitated before there is authority for the agent to be able to act on behalf of the principal. So the question is: "Once the principal signs the POA for an immediate power, does that principal lose any power/authority?"  Quick answer: No. The POA document in this scenario simply adds another individual as an authorized party to deal with accounts or other financial interests.  Thus, the principal can continue to operate as normal.  The principal also has the ability to remov...

When I was younger, I used to love Now and Later candy , despite the "workout" it gave my mouth/teeth.  You can enjoy the candy as a hard candy, and continue to enjoy it later when it is soft and chewy. It was like having having a different piece of candy, all in one piece. When I discuss a power of attorney document with a client, one of the questions that I go through is whether they want the authority to be a springing power or an immediate power.  For example, do you want the person you identify to have authority to act on your behalf only when your doctor says you don't have sufficient capacity? Or, alternatively, do you want that person to have authority immediately , regardless of your capacity level? For many clients (and for many attorneys) the initial thought/answer is 'why would you give someone power over your assets when you don't need any help?'  Here are my three responses: 1.  You may have sufficient capacity, but you aren't around....

I have previously posted previously pretty much on all of these items separately, but I thought I'd commit to the "checklist-mania" and add my own checklist.  For individuals that are helping out with an aging family member, this can be a quick guide to get you started.  (If you are taking advantage of an aging family member, then you need to get a conscience and turn yourself into the authorities.) While this list can be used for pretty much anybody, young or old, this can be a helpful guide for those assisting a parent/grandparent with planning. Power of Attorney (health) - This document enables health care decisions, such as medicine, doctor, facility, therapy, etc. to be made by a selected individual.  While more than one can be named, it is typically preferred to name one responsible individual. Power of Attorney (financial) - This document provides for someone to handle financial matters.  Iowa's recently updated statute provides significant changes to th...

Well, it was a long time coming, but following unanimous passage in the Iowa House and Iowa Senate, today Governor Branstad signed the Uniform Power of Attorney bill into law.  The Uniform POA is a substantial and long-overdue replacement to the current power of attorney statute (Iowa Code chapter 633B). The statute is applicable to ALL power of attorney documents, whether signed before or after the effective date of July 1, 2014. Some key points from the Uniform act: (1) provides for improved remedies in event of abuse/misuse of authority; (2) clear guidance for agents; (3) addresses powers involving co-agents; (4) specific and general authority of agents; and (5) statutory form to use for individuals without attorney access.

A local news story helps provide another sad example of why it is important to establish some basic estate planning, regardless of your age.  A young lady was involved in an automobile accident that has left her in a coma and unable to deal with her personal affairs.  As a result, her friends and family are struggling with the financial restrictions of getting access to her accounts to deal with various matters. Two relatively simple documents- Financial Power of Attorney and Medical Power of Attorney -would have made this job much easier and cheaper.  The cost for getting these basic and essential documents in place is minuscule when compared to having to go to court to establish a guardianship and/or conservatorship for someone in this situation.  Commonly younger individuals don't realize the need or importance for such documents as they are young and immortal, or believed to be less likely to have a need for these provisions.  Unfortunately,...

A local couple (a pastor and his wife nonetheless) were recently charged with theft and dependent adult abuse.  There were charged with taking money from both of their elderly parents, under authority of a power of attorney to pay for vacations, airfare, motels and eating out frequently.   Local authorities and national organizations are reporting an increase in elder abuse in the past year, likely attributable to challenging economic times.  The typical power of attorney grants the attorney-in-fact broad power to act in their stead.  This power is typically granted without any oversight, which can be too tempting for some people. If you suspect that someone is misusing the power granted to them, report the information immediately to the local police who will be able to properly investigate the case.  

Alzheimer's is a horrendous disease with someone developing Alzheimer's every 71 seconds . Watching a loved one's condition continue to deteriorate to the point of not recognizing family members or their life is truly depressing. However, there are certain legal steps to consider when a family member is involved. Guardianship and conservatorship If decisions need to be made for an incapacitated individual, whether medical care or financial matters, it may be necessary to have a guardian/conservator appointed by a court. Trust - If a self-settled trust has already been established by the incapacitated individual, it may be necessary to examine having the successor trustee step in to handle trust management matters. Power of Attorney - If the individual has already signed a power of attorney (health and financial), steps should be taken to determine whether the disability provisions are applicable and granting authority. Beneficiary Designation review - Information sh...

Following a controversial decision by the Iowa Supreme Court and after some wrangling in the Iowa legislature , Governor Chet Culver signed SF 473 into law on April 11, 2008. Effective July 1, 2008, this new chapter to the Iowa Code (chapter 144C) authorizes an individual to designate an individual to make decisions over the disposition of their bodily remains following their death. The designation does not indicate how a person wants their body remains to be handled, only who has the authority to make those decisions that are "reasonable under the circumstances". Now, what is "reasonable under the circumstances"? Under the definitions section, consideration should be given to the deceased's financial situation, religious beliefs and cutural or family customs. Also, if the designee doesn't promptly step forward and assume their responsibility, they forfeit their rights. In fact, the designee has either 24 hours after notification or 40 hours after ...

I missed it last week, but April 16th was National Healthcare Decisions Day 2008 . Most people have an opinion on what type of medical treatment they would receive if they had the opportunity to visit with their healthcare provider. It certainly makes sense that one would want to establish ahead of time what type of medical treatment if they weren't capable of visiting. Unfortunately, a 2003 article reported that less than 50% of severely or terminally ill had an advanced directive in their medical record. If you don't have an advanced directive already, take steps to have one signed. Then, after getting it signed, the next step is to have it included as part of your medical record.

A common document executed in the estate planning process is a Power of Attorney document. That document confers authority to another person, or persons, to act on your behalf either because you are unable or just want that person to handle certain matters for you. For example, you are in a car accident and can't handle payment of your bills, cash checks, etc., someone can handle those affairs for you. That person's title is the "attorney-in-fact" even though they are not typically an actual attorney in the ordinary sense. You can limit the authority of what the attorney in fact may do, or you can give them broad general powers to do generally anything necessary. There is a also a Medical Power of Attorney in which you appoint someone to handle your medical and personal decisions, such as what medical treatment you receive or what facility you are placed at. This power only comes into play if you are unable to communicate your wishes. These aren't required d...