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Dave and the MPS Success Team
Wednesday, December 22, 2010
Wednesday, December 1, 2010
BEWARE OF BIFF AND BAMBI
Joan and Bob recently met with a MPS attorney to determine what they need to consider in creating an estate plan. Bob and Joan were in their mid 60s and had been married for 39 years. They had three children and managed to accumulate about a half a million dollars in assets over their life time. They are living comfortably on their Social Security and pension, and only access the income off of their assets when they want to splurge.
In order to help Joan and Bob determine the best plan, the MPS attorney took them through a series of 15 questions, and also reviewed their current estate plan to identify which of the 15 estate planning issues their current plan accomplished. As the MPS attorney identified multiple issues not currently provided for in their plan, he/she dug deeper to determine if the individual issues were significant to Bob and Joan. The MPS attorney asked whether they were concerned about their spouse remarrying after their death. Both responded with a laugh, and said not the least bit concerned and were confident that even if they did remarry, they would never hurt the children. Bob and Joan were confident they wanted to ensure that what they had worked for their entire life ultimately got to their children.
The MPS attorney explained that while they currently did not have these concerns, in his experience, the emotional trauma one goes through with the loss of a loved one, often triggers reactions one cannot anticipate. He encouraged them to consider implementing protecting against remarriage into their plan so a new spouse could not usurp the benefits of their lifetime of efforts from the children. The MPS attorney jokingly referred to this risk as Biff and Bambi. He further explained, he wanted to help them ensure the money did not end up with Biff, the pool boy, or Bambi, the bar maid. Again, they laughed and assured him this was not a concern of theirs, and indicated that it was not a priority and they did not include it in their planning.
About nine months later, Joan was diagnosed with a serious cancer, and died three months after diagnosis. Bob came into the office distraught, and the MPS attorney assisted him with conveying all of Joan’s assets to his name. About six months later, Bob returned giddy and happy with a young blonde woman, 20 years his junior. He instructed the MPS attorney he wanted to change his estate plan to ensure if anything had happened to him, his new friend “would be provided for”.
The MPS attorney reminded Bob of the goals and objectives he had set with his original wife, and Bob replied not to be concerned as he was very confident about what he was doing. The MPS attorney in good conscious told Bob he could not assist him in this matter, and required he seek other counsel. Bob was disappointed, but immediately got up and left, and sought other counsel to accomplish his objectives.
Each one of us knows a story of someone close to us, or a family friend, who lost their spouse while they were in their early retirement years. We’ve also heard the story of when new found love creeps in and changes the perspective of the surviving spouse. This is a tragedy that does not have to happen. With proper planning, the surviving spouse can get all the benefits of the estate without the risk of losing it to Biff or Bambi, with very little additional effort.
If your clients are concerned about Biff or Bambi, join MPS on December 14th for a ONE hour webinar and learn how to confidently deliver what clients and referral sources don’t blink at writing checks for. Find out what clients are looking for in their estate plan, NOW, what they are willing to pay and how to attract these clients.
This webinar will be hosted by Dave Zumpano, Founder of MPS and practicing attorney, Just Like You! Register here: https://www1.gotomeeting.com/register/968634353
In order to help Joan and Bob determine the best plan, the MPS attorney took them through a series of 15 questions, and also reviewed their current estate plan to identify which of the 15 estate planning issues their current plan accomplished. As the MPS attorney identified multiple issues not currently provided for in their plan, he/she dug deeper to determine if the individual issues were significant to Bob and Joan. The MPS attorney asked whether they were concerned about their spouse remarrying after their death. Both responded with a laugh, and said not the least bit concerned and were confident that even if they did remarry, they would never hurt the children. Bob and Joan were confident they wanted to ensure that what they had worked for their entire life ultimately got to their children.
The MPS attorney explained that while they currently did not have these concerns, in his experience, the emotional trauma one goes through with the loss of a loved one, often triggers reactions one cannot anticipate. He encouraged them to consider implementing protecting against remarriage into their plan so a new spouse could not usurp the benefits of their lifetime of efforts from the children. The MPS attorney jokingly referred to this risk as Biff and Bambi. He further explained, he wanted to help them ensure the money did not end up with Biff, the pool boy, or Bambi, the bar maid. Again, they laughed and assured him this was not a concern of theirs, and indicated that it was not a priority and they did not include it in their planning.
About nine months later, Joan was diagnosed with a serious cancer, and died three months after diagnosis. Bob came into the office distraught, and the MPS attorney assisted him with conveying all of Joan’s assets to his name. About six months later, Bob returned giddy and happy with a young blonde woman, 20 years his junior. He instructed the MPS attorney he wanted to change his estate plan to ensure if anything had happened to him, his new friend “would be provided for”.
The MPS attorney reminded Bob of the goals and objectives he had set with his original wife, and Bob replied not to be concerned as he was very confident about what he was doing. The MPS attorney in good conscious told Bob he could not assist him in this matter, and required he seek other counsel. Bob was disappointed, but immediately got up and left, and sought other counsel to accomplish his objectives.
Each one of us knows a story of someone close to us, or a family friend, who lost their spouse while they were in their early retirement years. We’ve also heard the story of when new found love creeps in and changes the perspective of the surviving spouse. This is a tragedy that does not have to happen. With proper planning, the surviving spouse can get all the benefits of the estate without the risk of losing it to Biff or Bambi, with very little additional effort.
If your clients are concerned about Biff or Bambi, join MPS on December 14th for a ONE hour webinar and learn how to confidently deliver what clients and referral sources don’t blink at writing checks for. Find out what clients are looking for in their estate plan, NOW, what they are willing to pay and how to attract these clients.
This webinar will be hosted by Dave Zumpano, Founder of MPS and practicing attorney, Just Like You! Register here: https://www1.gotomeeting.com/register/968634353
Tuesday, November 23, 2010
Why You Should Leave Your Assets To Loved Ones
Charles came into the law office of an MPS attorney to undertake estate planning. Charles was a widow and had no children. The bulk of his estate was going to three nieces and nephews. Charles had in excess of $750,000.00, and he wanted to ensure when he died, it got to his nieces and nephews quickly and avoided probate. He heard a living trust was the way to do that. When he called the MPS attorney's office, the staff recommended he attend a workshop to discover all the different issues he may not ordinarily be aware of when planning. Reluctantly, he went to the workshop and he was thrilled with all he had learned. Specifically, he liked the option to ensure when he passed, rather than leaving his assets to his nieces and nephews outright, he could give it to them in a protected trust that permits them to access to it for the rest of their lives, but not their creditors, spouses in divorce, nursing homes, the government, or lawsuits.
Charles engaged the MPS attorney and among other things, ensured when he passed, each of his nieces and nephews would receive their $250,000.00 in a trust for their benefit, in which they were the trustee. The trust also provided, they needed a co-trustee which they can appoint at their discretion. Charles later died, and his brother Frank, came into the office as the successor trustee to administer Charles' trust. Frank was confused, as were his children, as to why Charles did not give them this money outright. They were a little disappointed. After some explanation by the MPS attorney, they were accepting and proceeded with the trust administration. Each of them received their separate share of uncle Charley's estate in a trust in which they were named trustee.
About a year later, Scott, one of Frank's children, contacted the MPS attorney concerned about a recent garnishment that had been put on his account at the bank. Evidently, Scott had been sued and a judgment was awarded to the party suing him. They executed a judgment against all of Scott's assets, including his accounts at the bank. Since Scott was a trustee of the trust left by Uncle Charles, they also put a lock on that account in hopes to empty it to satisfy their judgment. The MPS attorney quickly explained to Scott that this is exactly why Uncle Charles had done what he did to ensure if any predators ever attempted to take the money from Scott, they would be prohibited. The MPS attorney immediately sent a letter to the law firm placing the execution on the account and to the bank's attorney advising them any attachment to the account was unauthorized and illegal. After a quick review of the trust, both the judgment holder and the bank acknowledged the account was not subject to levy and released it. The funds remained available for Scott's use without the risk of any further attachment by the judgment creditor or anyone else.
You, or your client, can protect your loved ones when you die to ensure when they inherit what you have worked your lifetime for, it stays with them without being at risk of being lost to their divorce, lawsuits, nursing homes, the government, or other creditors. To learn how to protect your clients assets and have them sending you their friends and family to you for year to come, join the MPS on December 14th for a 1 hour webinar and learn What to do differently in 2011 to make it your most profitable year ever; confidently delivering what clients and referral sources don’t blink at writing checks for.
Find out what a client is looking for in their estate plan, NOW, what they are willing to pay and how to attract these clients. ?
Discover What Clients Writing Checks for & the 3 Elements You Need to Provide it!
This call will be hosted by Dave Zumpano, Founder of MPS and practicing attorney, Just Like You! Register here https://www1.gotomeeting.com/register/968634353
Charles engaged the MPS attorney and among other things, ensured when he passed, each of his nieces and nephews would receive their $250,000.00 in a trust for their benefit, in which they were the trustee. The trust also provided, they needed a co-trustee which they can appoint at their discretion. Charles later died, and his brother Frank, came into the office as the successor trustee to administer Charles' trust. Frank was confused, as were his children, as to why Charles did not give them this money outright. They were a little disappointed. After some explanation by the MPS attorney, they were accepting and proceeded with the trust administration. Each of them received their separate share of uncle Charley's estate in a trust in which they were named trustee.
About a year later, Scott, one of Frank's children, contacted the MPS attorney concerned about a recent garnishment that had been put on his account at the bank. Evidently, Scott had been sued and a judgment was awarded to the party suing him. They executed a judgment against all of Scott's assets, including his accounts at the bank. Since Scott was a trustee of the trust left by Uncle Charles, they also put a lock on that account in hopes to empty it to satisfy their judgment. The MPS attorney quickly explained to Scott that this is exactly why Uncle Charles had done what he did to ensure if any predators ever attempted to take the money from Scott, they would be prohibited. The MPS attorney immediately sent a letter to the law firm placing the execution on the account and to the bank's attorney advising them any attachment to the account was unauthorized and illegal. After a quick review of the trust, both the judgment holder and the bank acknowledged the account was not subject to levy and released it. The funds remained available for Scott's use without the risk of any further attachment by the judgment creditor or anyone else.
You, or your client, can protect your loved ones when you die to ensure when they inherit what you have worked your lifetime for, it stays with them without being at risk of being lost to their divorce, lawsuits, nursing homes, the government, or other creditors. To learn how to protect your clients assets and have them sending you their friends and family to you for year to come, join the MPS on December 14th for a 1 hour webinar and learn What to do differently in 2011 to make it your most profitable year ever; confidently delivering what clients and referral sources don’t blink at writing checks for.
Find out what a client is looking for in their estate plan, NOW, what they are willing to pay and how to attract these clients. ?
Discover What Clients Writing Checks for & the 3 Elements You Need to Provide it!
This call will be hosted by Dave Zumpano, Founder of MPS and practicing attorney, Just Like You! Register here https://www1.gotomeeting.com/register/968634353
Thursday, November 18, 2010
DOES THE GIFT TAX APPLY?
Joe, a widower, came into the office of a MPS attorney. He wanted to avoid paying estate taxes or losing his assets to a nursing home, so he asked the attorney if he should start gifting his assets away to his children. The MPS attorney explained to Joe that there are pros and cons of gifting assets away. Upon review of Joe’s financial situation, the attorney assured him the estate tax did not apply to him, because he did not have sufficient assets to be subject to this tax. In addition, giving assets away now, pose several concerns Joe might not be aware of.
The MPS attorney explained to Joe giving gifts to his children will forever put those assets out of his reach and fully under the control of his children. While his children may be trustworthy, outside events could occur that would put those assets at risk. For example, if his child gets divorced, sued, or dies, the assets would end up in the hands of someone other than Joe. In addition, if his child goes bankrupt, Joe’s assets would have to be used in his children’s bankruptcy.
Also, a gift to children, or others, could make Joe ineligible for Medicaid benefits for up to five years or more! The attorney continued to explain that perhaps the biggest downside of making gifts is that Joe’s children would receive the asset from Joe at his tax basis, which often leads to income taxes to the children when they dispose of the asset. The children would not have had to pay the income tax, had Joe given these assets to them after he died.
As to the gift tax, the attorney explained to Joe that he could gift $13,000 per year to any individual, including his children. If he gifted in excess of $13,000 to any individual or child within a calendar year, it would be subject to a gift tax, but the IRS provides that Joe has a million dollar lifetime exemption in addition to the $13,000 annual exemption. Therefore, if Joe gave away $23,000 to an individual in one calendar year, the additional $10,000 would reduce his $1,000,000 lifetime credit to $990,000. Since Joe only had $512, 000, the gift tax was not a concern to him, because he could never gift a million away, and so he would actually never be subject to a gift tax.
Proper planning ensures that your clients understand the gift tax rules and the significant risk with giving gifts during life. Contact MPS to discover how to help your clients transfer their assets to our trademark iPug™ trusts that permit them to retain control and retain benefits, but still have the protection they seek.
The MPS attorney explained to Joe giving gifts to his children will forever put those assets out of his reach and fully under the control of his children. While his children may be trustworthy, outside events could occur that would put those assets at risk. For example, if his child gets divorced, sued, or dies, the assets would end up in the hands of someone other than Joe. In addition, if his child goes bankrupt, Joe’s assets would have to be used in his children’s bankruptcy.
Also, a gift to children, or others, could make Joe ineligible for Medicaid benefits for up to five years or more! The attorney continued to explain that perhaps the biggest downside of making gifts is that Joe’s children would receive the asset from Joe at his tax basis, which often leads to income taxes to the children when they dispose of the asset. The children would not have had to pay the income tax, had Joe given these assets to them after he died.
As to the gift tax, the attorney explained to Joe that he could gift $13,000 per year to any individual, including his children. If he gifted in excess of $13,000 to any individual or child within a calendar year, it would be subject to a gift tax, but the IRS provides that Joe has a million dollar lifetime exemption in addition to the $13,000 annual exemption. Therefore, if Joe gave away $23,000 to an individual in one calendar year, the additional $10,000 would reduce his $1,000,000 lifetime credit to $990,000. Since Joe only had $512, 000, the gift tax was not a concern to him, because he could never gift a million away, and so he would actually never be subject to a gift tax.
Proper planning ensures that your clients understand the gift tax rules and the significant risk with giving gifts during life. Contact MPS to discover how to help your clients transfer their assets to our trademark iPug™ trusts that permit them to retain control and retain benefits, but still have the protection they seek.
Saturday, November 13, 2010
WOW
We are privileged at MPS to have the unparalleled community of attorney
family members with us this past week at The Annual MPS Enhancement Retreat.
It was an absolute honor to serve in your cause to help you help others. We
have an abundance of gratitude for your allowing the team at MPS does what
we are passionate about. Thank you for the opportunity to do what we love to
do because at MPS, we succeed by helping you succeed by helping others! We
look forward to 2011 and continue to help each and every one of you in
creating and maintaining a thriving salable practice! Go get 'em!
family members with us this past week at The Annual MPS Enhancement Retreat.
It was an absolute honor to serve in your cause to help you help others. We
have an abundance of gratitude for your allowing the team at MPS does what
we are passionate about. Thank you for the opportunity to do what we love to
do because at MPS, we succeed by helping you succeed by helping others! We
look forward to 2011 and continue to help each and every one of you in
creating and maintaining a thriving salable practice! Go get 'em!
Thursday, November 11, 2010
WHEN YOU LEAST EXPECT IT
Bob and Eleanor, a healthy 70 year old couple, came into the office of a MPS attorney to do estate planning. After a brief educational process and three meetings, the plan was created. Bob and Eleanor were thrilled and went on their merry way.
Three months later, the attorney received a call from Eleanor, indicating Bob was in Intensive Care; one of his kidneys had stopped working and his remaining kidney was shutting down. The ICU doctor told Eleanor that they would have to put Bob on a machine to maintain his life, or he may die. Eleanor was concerned, because while she loved him dearly, Bob was very clear he did not want to live on a machine. Eleanor asked the doctor if the machine would help him recover or whether he would have to stay on the machine. The doctor’s response was, “We’re not sure, but if we elect to put him on the machine, it will be difficult for me to have him removed from it.”
The MPS attorney told Eleanor not to worry that her health care directive had a 30 day provision which ensured that, if she elected to put Bob on any type of life support, she would be able to remove him at any time, but at the latest 30 days. The attorney agreed to stop by ICU and talk with the doctor and show him the legal document. After a review of the 30 day provision, the doctor was pleased and shocked at how nice it was to see good quality legal preparation. It actually took the pressure off of him.
Bob was put on life support and removed three days later after a wonderful recovery. Bob went on to live five more years. Eleanor and Bob thanked the MPS attorney, because Eleanor was confident that, if the 30 day provision was not in the health care directive, she would not have put Bob on life support.
Many people assume it will be a “cut and dry” decision when asked if they want to put their loved one on life support. The truth is, in that moment, the typical individual will do everything possible to preserve the life of their loved one. Even if they want to honor the loved one’s wishes, in many cases they are not emotionally ready to let go. Having the 30 day provision (or other period of time chosen by the client) ensures that control will remain with the family during this critical time, and allow the loved ones to adjust emotionally to the situation at hand. In some cases, like Bob’s, this additional time may even preserve their life. To learn about all the Client Centered Customized provisions that should be in a health care directive to protect your clients and distinguish yourself in your marketplace, contact MPS www.mpssuccess.com .
Three months later, the attorney received a call from Eleanor, indicating Bob was in Intensive Care; one of his kidneys had stopped working and his remaining kidney was shutting down. The ICU doctor told Eleanor that they would have to put Bob on a machine to maintain his life, or he may die. Eleanor was concerned, because while she loved him dearly, Bob was very clear he did not want to live on a machine. Eleanor asked the doctor if the machine would help him recover or whether he would have to stay on the machine. The doctor’s response was, “We’re not sure, but if we elect to put him on the machine, it will be difficult for me to have him removed from it.”
The MPS attorney told Eleanor not to worry that her health care directive had a 30 day provision which ensured that, if she elected to put Bob on any type of life support, she would be able to remove him at any time, but at the latest 30 days. The attorney agreed to stop by ICU and talk with the doctor and show him the legal document. After a review of the 30 day provision, the doctor was pleased and shocked at how nice it was to see good quality legal preparation. It actually took the pressure off of him.
Bob was put on life support and removed three days later after a wonderful recovery. Bob went on to live five more years. Eleanor and Bob thanked the MPS attorney, because Eleanor was confident that, if the 30 day provision was not in the health care directive, she would not have put Bob on life support.
Many people assume it will be a “cut and dry” decision when asked if they want to put their loved one on life support. The truth is, in that moment, the typical individual will do everything possible to preserve the life of their loved one. Even if they want to honor the loved one’s wishes, in many cases they are not emotionally ready to let go. Having the 30 day provision (or other period of time chosen by the client) ensures that control will remain with the family during this critical time, and allow the loved ones to adjust emotionally to the situation at hand. In some cases, like Bob’s, this additional time may even preserve their life. To learn about all the Client Centered Customized provisions that should be in a health care directive to protect your clients and distinguish yourself in your marketplace, contact MPS www.mpssuccess.com .
Wednesday, November 3, 2010
IS MY POWER OF ATTORNEY POWERFUL ENOUGH?
Betty recently went into a nursing home. Her daughter Samantha, who had Power of Attorney for her, became quite anxious because she did not know what to do or where any of her mom’s “stuff” was. She contacted a local MPS attorney to find out what to do. On arrival to the office, the MPS attorney quickly reviewed the Power of Attorney executed, appointing Samantha. On review, the attorney noted it was a standard Power of Attorney, provided for in the state’s statutes, and used by most attorneys. Unfortunately for Samantha, since it was the statutory Power of Attorney, it did not contain sufficient powers for her to do the necessary planning with him.
While the statutory Power of Attorney did provide authority to deal with the bank, financial institutions, and real estate on Betty’s behalf, it did not provide any authority to create a trust, do asset protection planning, or to authorize Samantha to convey assets to herself. Samantha only has one other sister, and being able to distribute to herself or her sister, is a key part of the plan to protect her mother’s assets.
In addition, the use of trust is another important strategy, but the Power of Attorney does not provide for it. Perhaps the greatest challenge, however, is with the Power of Attorney, in that the agent acting as Power of Attorney virtually is handed a “blank check”. While the Power of Attorney grants Samantha authority to access accounts and deal with legal and financial matters on Betty’s behalf, it does not provide any instructions on how Samantha should exercise her authority.
Samantha intended to exercise her authority as her mom would’ve wished, so she began making decisions, which her sister quickly questioned. Samantha readily explained it was always mom’s wishes to do what she had done, but her sister had a very different perspective on what mom would’ve wanted, and the arguments began.
Samantha asked the MPS attorney what she should do. He identified these arguments were typical, and clarified for Samantha that her sister was not necessarily trying to create fights, but merely had a different perspective of what their mom wanted. The truth is, both kids wanted to do what Betty desired, they just had different perspectives of what it was that she really wanted.
A properly drawn Power of Attorney, with a set of instructions attached, can avoid family feuds, and insure Samantha has all the authority necessary to carry out the wishes of her mother, that are clearly defined. The MPS attorney asked Samantha if Betty was still competent. Samantha indicated she was competent, but had no desire to deal with any legal or financial matters. The MPS attorney quickly stated, “Great”. We will get a new Power of Attorney executed, with all the authority you need, and a sufficient set of instructions on how your mom intends you to use it, and we will meet with her to get the document signed.” Samantha was thrilled. Her sister felt better, as well, and they began to work together to meet mom’s needs.
Do your clients have the standard Power of Attorney? Don’t wait until crises occur to discover its pitfalls. Call MPS to discuss your softwares Power of Attorney, and the ramifications of the provisions it has, or more importantly, fails to have.
While the statutory Power of Attorney did provide authority to deal with the bank, financial institutions, and real estate on Betty’s behalf, it did not provide any authority to create a trust, do asset protection planning, or to authorize Samantha to convey assets to herself. Samantha only has one other sister, and being able to distribute to herself or her sister, is a key part of the plan to protect her mother’s assets.
In addition, the use of trust is another important strategy, but the Power of Attorney does not provide for it. Perhaps the greatest challenge, however, is with the Power of Attorney, in that the agent acting as Power of Attorney virtually is handed a “blank check”. While the Power of Attorney grants Samantha authority to access accounts and deal with legal and financial matters on Betty’s behalf, it does not provide any instructions on how Samantha should exercise her authority.
Samantha intended to exercise her authority as her mom would’ve wished, so she began making decisions, which her sister quickly questioned. Samantha readily explained it was always mom’s wishes to do what she had done, but her sister had a very different perspective on what mom would’ve wanted, and the arguments began.
Samantha asked the MPS attorney what she should do. He identified these arguments were typical, and clarified for Samantha that her sister was not necessarily trying to create fights, but merely had a different perspective of what their mom wanted. The truth is, both kids wanted to do what Betty desired, they just had different perspectives of what it was that she really wanted.
A properly drawn Power of Attorney, with a set of instructions attached, can avoid family feuds, and insure Samantha has all the authority necessary to carry out the wishes of her mother, that are clearly defined. The MPS attorney asked Samantha if Betty was still competent. Samantha indicated she was competent, but had no desire to deal with any legal or financial matters. The MPS attorney quickly stated, “Great”. We will get a new Power of Attorney executed, with all the authority you need, and a sufficient set of instructions on how your mom intends you to use it, and we will meet with her to get the document signed.” Samantha was thrilled. Her sister felt better, as well, and they began to work together to meet mom’s needs.
Do your clients have the standard Power of Attorney? Don’t wait until crises occur to discover its pitfalls. Call MPS to discuss your softwares Power of Attorney, and the ramifications of the provisions it has, or more importantly, fails to have.
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