If you have a small estate, you can deed your house and still be able to live there until you pass away, and avoid probate.

If you have a simple estate, you might want to consider passing your house, using a Gift Deed and retaining a life estate. This type of deed conveys your house to a person or persons and reserves to you, the Grantor, the right to live in the house for the rest of your life. The ownership in the property is divided into two interests: a life estate and a remainder interest. The person who holds the life estate has the right to possess the property during his or her lifetime. The person who has the remainder interest has the right to possess the property after the life tenant passes away.

Example: John Smith, in consideration of the love that he has for his daughter, Laura, conveys his house to her as her sole and separate property reserving and excepting to John the right to all rents and profits on the property and the right to use the property for as long as John lives. At John’s death, the house passes to Laura simply by recording a Death Certificate, without having to go through probate.

If you want to use a deed retaining a life estate, there are a couple of things you should know. First, once your have deeded the property retaining a life estate, you can no longer sell the property without the signature of the person holding the remainder interest. For example, a woman deeded her home to her daughter and retained a life estate. Later, she had a falling out with her daughter. She wanted to sell her home and move, however, her daughter refused to sign the deed, so the woman was unable to sell her home. Second, if you deed your home and retain a life estate and later apply for Medicaid, your life estate interest may be counted as an asset towards eligibility for Medicaid.

A Gift Deed retaining a life estate is a way to transfer your property without going through probate and still retain the use of the property during your life time. Make sure you understand the risks before using this type of deed.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

June 2018

Common sense, conscientiousness and honesty are the main requirements.

If you have been asked to be a Personal Representative, you may wonder what your responsibilities are. Essentially, your job is to gather and take care of the deceased person’s assets, pay valid debts and distribute what is left to the people who will inherit it. However, before you can act, you must file a petition with the Court to probate the estate and to be named the Personal Representative. The Court will issue Testamentary Letters to you—documents that evidence your authority to act on behalf of the deceased’s estate. During the administration of the estate, you may be required to present copies of these Letters to persons with whom you transact estate business.

You may have additional duties as the Personal Representative which might include setting up a bank account for the estate, paying current bills and completing a final tax return. You may also need to cancel services such as phone contracts and utility bills and notify Social Security and pensions.

In some cases, you may want to publish a Notice to Creditors in the local newspaper. By publishing a Notice to Creditors, creditors are put on notice that they must make their claims within 4 months of the date of the publication or their claims will be barred.

After all known debts, administration expenses, and taxes have been paid or provided for, a final report or account should be prepared. Copies of the report should be made available to all persons interested in the estate.

Normally, distribution of the assets will await the closing of the estate. However, depending on such factors as the size of the estate, the needs of the beneficiaries, tax considerations and the desirability of avoiding the payment of interest on specific bequests, earlier partial distributions may be made.

Being a Personal Representative is a significant responsibility. The decedent is depending on you to settle his or her estate and to distribute the remaining assets to the persons designated. Common sense, conscientiousness and honesty are the main requirements for being the Personal Representative.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

May 2018

For those whose spouse has passed away and who are considering remarriage, a Prenuptial Agreement can assure that your estate will go to your children.

If your spouse has passed away and you are contemplating a second marriage, you may want to consider making a Prenuptial Agreement. With a Prenuptial Agreement and proper Wills, you can set out the duties and obligations that you and your new spouse will have upon death or divorce and assure that the property that you bring into the marriage will pass to your children.

A Prenuptial Agreement will typically include the following provisions:

• A disclosure of each party’s assets and income.
• A waiver of claim against each other’s assets.
• How daily expenses are to be paid.
• Whether the parties will file joint or individual income tax returns.
• Whether the surviving spouse may continue to live in deceased spouse’s home.

If you do not have a Prenuptial Agreement or a Will, upon your death your property will pass under the intestate laws of Idaho. Idaho Code              § 15-2-102 provides that the surviving spouse will receive the following share of the deceased spouse’s estate:

• As to separate property if there are surviving issue (posterity), the surviving spouse will receive one-half of the separate property and the deceased spouse’s issue will receive one-half of the separate property.
• As to community property—property that has been acquired during the marriage or separate property that has been comingled—allthe community property goes to the surviving spouse.

In addition, if you do not have a Prenuptial Agreement or a Will that provides otherwise, when you die your spouse has a right to receive $60,000 from your estate—a homestead allowance of $50,000 and an exempt property allowance of $10,000.

A Prenuptial Agreement entered into before marriage establishes property rights after marriage. When you have made your intentions clear and your estate plan is carried out, your property will go to those you have designated, not to someone your never intended.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

April 2018

It’s better to sign powers of attorney before you have a crises.

Here is a story frequently recounted to me by families: Mom and dad have lived a full life together, but recently things have started to change. Dad has been diagnosed in the early stages of Dementia and mom has developed some physical limitations. Together they manage, but alone they are not able to care for themselves. This recently became apparent when mom got pneumonia and went to the hospital, and dad could not remain at home alone.

Wondering what to do to help their parents, adult children often come to me for advice on how to prepare their parents for the future. I always ask if their parents have financial and healthcare powers of attorney, knowing how important it is for them to have someone who can step in and help them if they need. This is even more important if they are considering facility placement or a Medicaid application.

Often, learning that they do not have powers of attorney, I ask if their parents are competent, or if they have the capacity to understand and sign documents. This question opens a can of worms, because the children don’t know the answer, and I am forced into making a capacity determination—something I try to avoid when possible. If only the parents had planned for this possibility and prepared the documents when they were competent, thinking clearly and knew what they wanted. Needless to say, a person should make these decisions when they are at their best, not at their worst.

As a lawyer, sometimes I must assess the capacity of the person needing to sign documents. Capacity is determined in the areas of their cognitive, emotional and behavioral abilities. Possible signs of cognitive incapacity include short term memory loss, communication problems, comprehension problems, lacking the capacity to understand multiple alternatives, problems with mathematical calculations, and disorientation. Emotional signs of incapacity include significant emotional distress and emotional inappropriateness. And behavioral signs include delusions, hallucinations or poor grooming and hygiene. Knowing the person’s abilities and deficits in all these areas, rounds out the total picture. It is not easy to determine when someone has crossed the line and is incapacitated.

Unfortunately, it is in this crises stage that I see many of my clients, and I must make the determination if the person has the capacity and understanding to sign documents, which hands their right to make decisions over to someone else. This decision becomes increasingly difficult if the children of the parents have differing opinions about what is best. In that case, I must also make the determination if any of the children are exerting undue influence on the parent.

In conclusion, Seniors lives take many turns. Events sometimes change one’s ability to live life in the way that he or she had hoped for. It is better to prepare powers of attorney early when one is competent, and there will less chance that the decisions made will be challenged on the grounds of incapacity.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

January 2018

In Idaho, probating a Will is a simple process.

Probate of a Will is generally necessary when title to property must be transferred at a person’s death. Probate allows for supervision of the estate by the Court, gives notice to heirs of the proceedings, and provides an opportunity to settle creditor claims.

Probate can be informal or formal. In Idaho, informal probate is a simple and efficient process that does not require Court hearings or judicial supervision. The estate can be distributed in a few weeks to a few months depending on the assets, creditors and heirs of the estate.

There is a 5-day waiting period after a person has passed away before an application for probate can be filed with the Court and the Personal Representative appointed. Once appointed, the Personal Representative inventories the property of the estate, identifies and pays creditors and then distributes the money and property in the estate according to the Will.

Formal probate involves a judge and is recommended when the Will is being contested. Will contests are usually raised for the following reasons: lack of testamentary capacity, undue influence, failure to witness or execute the Will properly or ambiguity in the Will concerning the decedent’s wishes. When writing a Will it is important to recognize and avoid these problems.

Recently, I had an adult child call me about his mother’s Will. He felt that he would be treated unfairly in the Will. He demanded that his mother change the Will and threatened to challenge the Will if she didn’t disrupting the family peace. This may not have raised to the level of undue influence, but it was certainly inappropriate.

Another client brought me his parent’s Wills to be probated after his parents had passed away. The Wills had been printed off the internet and signed. As I reviewed them, I determined that the Wills had not been properly witnessed or notarized, leaving their validity open to challenge.

You work a lifetime to accumulate your estate. You should take great care when writing your Will and seek expert advice when appropriate. The Will contests that I have done in my career have involved Wills drafted by individuals, their friends or their family.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

October 2017

If you hold title to your home as community property, your home does not automatically transfer to you at your spouse’s death.

Joint tenancy lets two or more persons—the joint tenants—to own property with a right of survivorship. This means that when one of the joint tenants dies, the surviving joint tenant automatically receives the deceased tenant’s share of the property. For example, in Idaho many people own vehicles as joint tenants. By using the magic word or instead of and when they list vehicle owner’s names on the title, they create a joint tenancy. Upon the death of one of the joint tenants, the surviving joint tenant simply signs a request for a new title at the assessor’s office to have the title to the vehicle transferred into his or her sole name.

Many couples in Idaho falsely assume that their home will also transfer automatically to the surviving spouse. But, Idaho is a community property state, and this is not the way community property laws work. There is, however, a way to hold title to community property so that it does transfer automatically. The magic words are found in Idaho Code §15-6-401. The deed transferring the property must include these words: “to be an estate in community property with right of survivorship.” If a couple wonders how they hold the title to their home, they should check their deed for these words. If these words are not in the deed, they can prepare a new deed to themselves using these words. When a couple holds title to their home as community property with a right of survivorship, they will avoid probate on the death of the first spouse. All the surviving spouse needs to do to transfer the title to the surviving spouse is to record a death certificate.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

September 2017

What to do if your parents need help and don’t have a Power of Attorney.

Recently in my elder law practice, I have met with several clients who are concerned for their parent’s welfare, but lack the authority to intervene on their behalf. In many cases, dementia has afflicted Mom or Dad, leaving them unable to handle their finances. They may also be at risk of wandering, getting lost or becoming forgetful and confused. At this point the parent may lack the legal capacity to sign Powers of Attorney to have someone step in and give them the needed help. In cases like this, a family member can petition the court for a Guardianship and Conservatorship of an incapacitated adult.

After petitioning the Court, the court may appoint a Guardian or a Conservator or both, if it is determined to be in the best interest of the incapacitated adult. The following explains what each provides:

A “Guardianship” involves a person being appointed by the Court to make legal decisions for another person. Usually this is a spouse, adult child, or another extended family member. The Court issues Letters of Guardianship which give the family member the authority to oversee healthcare decisions, living arrangements, and the welfare of the person in need of a guardian. The Court monitors the guardian and requires an annual report.

A “Conservatorship” involves a person being appointed by the Court to manage the financial affairs of another person. The Court issues Letters of Conservatorship which gives authority to someone to pay bills, make financial decisions or protect assets for the incapacitated adult. The Court monitors the Conservator and requires an annual report to the Court concerning the finances of the person.

When older adults are forward-thinking, they will put in place Powers of Attorney for Healthcare and Finances, and choose who THEY want to be their agents. This way they can name someone they trust, and discuss their financial and healthcare situation with that person and let them know what they want to have happen.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

June 2017

Is it worth your while to avoid Probate?

If you are interested in avoiding probate, you might want to check out Mary Randolph’s, J.D. book “8 Ways to Avoid Probate.” If you own property at your death, probate offers an orderly process to transfer that property to others. However, there are ways called nonprobate transfers to pass property to others without going through probate. Here is the list from Mary Randolph’s book:

1. Set up a Pay-On-Death (POD) account. This is done by signing a form provided by your financial institution or bank, designating to whom you want your checking and savings accounts to go to at your death.

2. Name a beneficiary for your retirement account and for your stocks and bonds. Again, you do this by designating your beneficiaries on a form provided by your financial institution.

3. Transfer of Vehicles at your death. In Idaho, there is no law allowing you to set up a transfer on death of your vehicle to another person. Some people create a joint ownership with the right of survivorship by putting their adult child’s name on the title to the vehicle. This can be risky because a creditor could sue the child and take the child’s interest in the vehicle. If your estate is small enough, your heirs can transfer the title to the vehicle by filing a small estate affidavit with the county assessor.

4. Transfer of Real Estate. Real property, such as a house, can be transferred to a spouse without going through probate if the couple holds the title to the property as Community Property with a Right of Survivorship. In addition, real property can be transferred by deeding the property to a person, but retaining a life estate in the property. This allows the person to continue living in the house until their death, and then title is transferred by recording a death certificate.

5. Hold property in as Joint Tenancy. This usually refers to setting up checking or savings accounts as joint tenants with a right of survivorship. When one of the account holders dies, the money in the account passes to the survivor. This works well with a spouse; however, if you put an adult child your account to help you pay bills, it may not be your intention for the child to have the money in the account at your death. This issue has led to many court cases to determine what the person’s intent was, when they put their child’s name on their account.

6. Create a Living Trust. When you create a trust, you transfer all of your property into the Trust. When you die, there is no probate because you own no property. The terms of the trust determine how the property passes at your death. This avoids Probate, but be aware that Trusts must be managed, and over time as things are acquired, they must continually be put into the trust–it does not happen automatically.

7. Small estate procedures. If the total value of all your assets in your estate is less than $100,000, your heirs can claim the property by filing an affidavit with the person or institution that has the property belonging to your estate. This refers to anything but real estate.

8. Make a gift. Property you give away before you pass away does not go through Probate. However, you should never give away property that you might need. There are also Medicaid rules about giving property away, that could prevent you from being eligible for Medicaid if you have given away property in the previous five years.

Avoiding probate is only one of the factors you should consider in planning how to transfer your property at your death. A Will does require Probate, but in Idaho it is a fairly simple process. It’s a good idea to seek legal advice so that your unique situation is handled the best way for you!

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us, 208-785-5600.

May 2017

How to ensure your property goes to those you desire, smoothly.

A lifetime often results in the accumulation of a significant amount of property. What happens to our property at the end of our lives? While a will is the determination of where you would like your property to go, probate refers to the actual process by which ownership of the property is transferred. In other words, the probate is the enactment or actualization of the will. In the event that a will does not exist, probate follows a process of distribution established by the law.

Probate can generally be broken down into four steps. The first is the courts’ official recognition of the personal representative, or executor. A personal representative is needed to oversee the distribution of the estate. Most often nominated within the will, this individual is empowered to perform a wide range of activities, including the signing of property deeds, filing tax returns, closing financial accounts, and selling assets. This person ought to be someone who is both trustworthy and responsible.

The second step involves the personal representative making an inventory and appraisal of all the decedent’s property. This is then filed with the probate court.

Third, any debts of the decedent are paid by the personal representative from money obtained from the estate. The order in which debts are to be paid is important, and must precede the distribution of the inheritance. Keep in mind that neither the personal representative nor other family members are held liable for debt not covered by the assets of the estate.

Finally, the remaining assets are distributed among heirs in accordance with the will (or in accordance with the Uniform Probate Code if a will does not exist). Distribution may occur through liquidation of the remaining assets or allocation of the property as is.

There are a few points important to note when it comes to Idaho probate:

• An informal probate is common and does not require court hearings or judicial supervision. Formal probate, involving a judge, is needed in situations where disputes arise or ambiguity exists regarding the decedent’s wishes.
• In certain circumstances, Trusts or Joint-Tenancies are better suited and can avoid probate altogether. But note that in Idaho, probate is a fairly easy process.
• Sometimes cases arise in which property is owned outside of the decedent’s state. In these instances, it is important to consult with your legal advisor to determine jurisdiction and whether an ancillary probate is needed.

It’s always a good idea to maintain careful records of your debts and assets, including deeds and documentation of bank accounts, certificates, insurance policies, stocks, and bonds. Keep your papers together in an accessible, safe place. By doing this, you ensure that your property will pass to those whom you designate, and that the transfer process will go as smoothly as possible for your loved ones.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

Having a Power of Attorney in place before you need it, is best!

Many times, important decisions must be made at a time when you are least able to make them. For instance, a sudden illness could temporarily or permanently take away the ability to make decisions. Since you don’t know what unforeseen events lie ahead, it is best to have powers of attorney in place, so a trusted person can step in and help if needed.

A “Power of Attorney,” or POA, is a legal document that authorizes a person of your choosing to act on your behalf in certain situations. The two most common types of POA’s are property and healthcare. The primary use of a POA is having someone legally empowered to make decisions for you if you become ill, incapacitated or even absent. Having such legal documents in place prior to the need arising, allows you greater control over what happens.

As you grow older, sometimes you need help when routine financial tasks become confusing or difficult. A Power of Attorney for property allows someone to step in and help you pay bills, sell property or apply for Medicaid. In contrast, a Durable Power of Attorney for Healthcare only comes into effect if you are unable to communicate. In that case, your agent has the authority to carry out your desires for medical treatment that you expressed in your Living Will.

It is important to recognize that your family cannot get a POA after you have become incapacitated. If you become incapacitated without a valid POA, a court may have to appoint a Guardian and Conservator to make important decisions for you. When this happens, sometimes family members fight over who will be appointed, and the costs to obtain and maintain a Guardianship and Conservatorship are high.

Many people feel some apprehension about creating a POA. They wonder, will my assets and money be kept safe? How do I know the authorized person will act in my best interest? These are valid concerns that can be addressed at the time of drafting a POA.

Here are a few tips you may want to consider when deciding to move forward on your power of attorney:

• Select someone who you trust and is competent to make difficult decisions in complex situations and who is looking out for what is best for you. While steps may be taken to prevent against abuse and fraud, there is no substitute for a trustworthy, qualified agent. A child or sibling can make for a good potential candidate.
• Creating a POA in no way limits your current access or control over financial and healthcare decisions.
• You have the option to revoke a POA should circumstances change that make it in your best interest to do so.
• A POA does not replace a person’s Will. POA’s are designed to terminate automatically upon death.
• Having a Power of Attorney for property is safer than putting someone on your checking account.

If you have the foresight and prudence to plan for incapacity before the need arises, you will be in the driver’s seat when important decisions in your life have to be made by others.

Tom Packer is an Elder Law Attorney serving all of Southeast Idaho. As part of his law practice, Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity.  If you have a question about a Senior’s legal, financial or healthcare needs, please call us.

Thomas W. Packer
186 East Judicial Street
Blackfoot, Idaho 83221
208-785-5600