THE DANCE

By Tim Barkley. April 2020. It was a little like a scene from a sci-fi movie when representatives of alien cultures meet to sign intergalactic treaties. But these were just garden-variety wills – yet signed under very unique circumstances. They came in wearing gloves and masks. The documents to be executed had already been laid on the table. We respectfully backed away to the other side of the large conference table as obligatory but somewhat muffled pleasantries were exchanged. The initial ceremonies completed, they signed and retreated. We circled the table, staying diametrically opposite them at all times. We witnessed their signatures, then had their signatures notarized. The documents were taken to “the back office” for copying and...

read more

NO NEW THING

By Tim Barkley. March 2020. Jack and Jill (not their real names) were sipping coffee when the attorney came into the conference room. “Thanks for calling,” the attorney greeted them. “I understand you want to update your estate plan.” “Well, really, we want to create one,” Jill clarified. “Jack got some papers a long time ago from a lawyer at his old work, but it doesn’t really deal with our situation now.” “Let’s see … two of you. Any kids?” “Three. All ours, and all adults. It’s really simple … everything to me, and if we die together, everything to the kids.” “Great. Simpler is better. What are we planning for? Real estate? Mutual funds? Vehicles?” “We own our house, and we have a couple of timeshares. We both have IRAs, and he has a...

read more

HOME ALONE II

By Tim Barkley. February 2020. Last month's offering to our readers considered the effect of the Inheritance Tax on folks without spouse, siblings or children as estate beneficiaries.  This month's article offers practical steps to ease the task of your surviving nieces, nephews, friends or other loved ones as they try to sort out your affairs. First, and most basically, be sure your estate planning documents are up-to-date, and that someone knows where to find them. An out-of-date will that leaves assets you no longer own to persons who are no longer living can be an invitation to expensive and time-consuming litigation. Changes in terminology, technology and social norms can make a decades-old medical directive worse than useless. This...

read more

HOME ALONE

By Tim Barkley. January 2020. Estate planning is often discussed in the context of the “typical American family” - Mom, Dad and 1.8 happily adjusted children.  But what if that's not you? Planning for unmarried, divorced or widowed clients who have no children presents a special challenge to the planning professional, and requires ingenuity and resourcefulness to avoid the traps for the unwary. The parents of the “typical American family” leave their assets to their children without a thought about the Maryland Inheritance Tax.  Most folks don't even know that it exists.  That tax is a flat 10% tax on distributions to anyone except lineal ancestors (parents and grandparents), lineal descendants (including stepchildren) and their spouses,...

read more

BACK TO BASICS

By Tim Barkley. December 2019. Billy and Joan had lived across town. He was her only child, and as she grew older, helped with her care. Joan, a widow, had just been admitted to a nursing home with dementia. Immediately after her admission to the home, Billy suddenly and catastrophically died. There was no one to handle Billy’s estate. He had never married and had no children. There was no one to take care of Joan, either. No family or friends came forward. A caring neighbor came to our office with the tale, and we agreed to try to help. Billy and Joan were very private, and we had no way to know whether he had a will, or whether she had named someone in a financial or medical power of attorney to take care of her. We didn’t know who the...

read more

MEDICAID BALANCING ACT

By Tim Barkley. November 2019. Susan sat across from the table and leafed through a manila file folder.  “What do you need to know?” “Well, to figure out whether and when Mom might qualify for Medicaid,” replied the lawyer, “we need to know what she owns and what it's worth. “There are two basic categories of assets: Exempt and Countable.”  He stood up, went to the whiteboard in the corner, and wrote the titles boldly, underlining each. “Exempt assets are assets that aren't counted for Medicaid qualification purposes.  Countable assets are. “Medicaid requires that countable assets be reduced below certain levels before Mom can qualify.  These levels are pretty low - $2,500 for a single person. “Countable assets includes everything not...

read more

FREE RIDE

By Tim Barkley. October 2019. Susan caught the lawyer by his elbow in the restaurant. “I thought that was you.  Can I ask you a question?” “Sure,” he replied, “what's on your mind?” “I was talking to a friend who told me that we should put Mom's houses and money in a trust so that a nursing home won't take everything.” “Here's the scoop,” the lawyer told her. “If your mother needs a nursing home to care for her, she has a large bill every month.  It might be as high as ten or twelve thousand dollars a month if she lives in an expensive facility, or as low as six or seven thousand.  It's a big bill, and it has to be paid. “If she stays there long enough, she'll spend a lot of her money.” “That's what worries us,” Susan said. “My father...

read more

FSBO – FOR SALE BY OWNER

By Tim Barkley. September 2019. Ricky and the lawyer sat at the conference table. “I know it's not the usual thing, to move right after your spouse has died, but I have a chance at a promotion at work if I transfer to the Dallas office. And my neighbor wants to buy the house so his daughter can live there. He wants his grandkids closer than Hagerstown. “What do we need to do?” The lawyer affirmed, “You're right, it's usually better to wait at least a year, some say two years, after the death of a spouse, before making any drastic changes. Are you sure this is the best thing?” “Yeah,” Ricky answered. “The wife and I had been talking about it before she died, and she's the one who found out that the neighbor wants to buy the house. I think...

read more

NOW WHAT?

By Tim Barkley. August 2019. The phone rang. The voice on the other end was subdued, but firm. “This is Ricky. You met with Susan and me about our mother. My wife just passed away.” Pause. “She had a heart attack and died at work yesterday. I need to know what to do – she didn't have a will. Is the State going to take everything?” “I'm so sorry,” the lawyer empathized, then reassured, “and there's nothing you really need to worry about right now as far as the law is concerned, unless she was being sued or something. Just do what you need to do, take care of the family, give me a call next week. I'll be happy to help you then. “And the State isn't going to take anything. Don't worry about that. “Your most important priority is to be her...

read more

NUPTIALS

By Tim Barkley. July 2019. It was Susan on the phone: “Can we get together?  I need you to look at a paper my fiancé gave me.” She came to the office with a large envelope in hand.  “My boyfriend finally asked me to marry him.  Then he gave me this and said I had to have a lawyer look at it.  It's a prenup.” “When are you tying the knot?” “Oh, not for awhile, but he said he wanted me to think about this before we got too far down the road.  I told him I didn't want his stuff and didn't need a legal paper, but he said his lawyer told him I needed to sign this and have my lawyer look at it before I do.  Do you do this kind of thing?” “Absolutely. I just finished writing one for another client.  And another guy brought his prenup to the...

read more

MOM’S TRUSTEE

By Tim Barkley. June 2019. The lawyer greeted Susan as she entered the office.  She waved a large maroon notebook.  “I think we might have found the trust.  Is that what this is?  It's about a million pages long.  We were going through some boxes in the basement and found this last night.” The lawyer carried the notebook to the conference room and leafed through it while Susan seated herself.  “Yep, this is a trust form used by lots of lawyers in the 90s.  I've reviewed it for lots of clients.  Here's where it lists who set up the trust.”  He pointed to page one, then flipped the page.  “Here's where it lists the family – your folks, Mary, you and your two brothers, Ricky and Bob.  Who's 'Michael'?” “He's the oldest.  He disappeared about...

read more

LOST TRUST

By Tim Barkley. May 2019. Susan sounded uncharacteristically jubilant on the phone: “Big news! Mary was picked up for a DUI and has disappeared! I don't think she'll be causing any more trouble.” “That's a relief,” replied the lawyer. “We'll have to talk to your mother's lawyer and see what she says about the guardianship, now that Mary's out of the picture.” “I think it's more than just the DUI,” replied Susan. “Mom's attorney told me that she had found out that Dad put the house and the real estate investments in a trust before he died. Mary couldn't get into the trust, so I think she lost interest. Even without the DUI, I think she would have gone away.” “Interesting.” “Very. But we have a problem. Nobody knows where the trust is, or...

read more