Illinois Transfer On Death Instruments (TODI) For Residential Real Estate

Illinois, as of January 1, 2012, provides an easy tool for transferring ownership of residential real estate at the death of the owner to another individual or to a trust, business, charity and other entities—the Transfer on Death Instrument or TODI. An owner of residential real estate may designate the future owner of the property in a written document which is signed by the owner and witnessed by 2 credible witnesses whose signatures along with the owner’s are notarized. The document must then be recorded before the owner’s death with the recorder of deeds in the county in which the real estate is located. Only an attorney or the owner of the real estate may prepare a TODI.

The benefits of a TODI are significant:

  1. The cost of a TODI is less expensive to have prepared than a Will or Trust. There are no ongoing fees to maintain the TODI;
  2. The TODI avoids probate at the death of the owner—only a death certificate and a Notice of Death Affidavit is required to transfer ownership to the designated person or entity;
  3. A TODI is always revocable by the owner.

Although relatively inexpensive and simple to establish, a TODI may not be appropriate in many circumstances, such as:

  1. A TODI doesn’t provide any creditor protection if the owner or designated death owners were to be sued because of an auto accident;
  2. The TODI option may not be a good choice if any of the designated beneficiaries are minors when the owner dies;
  3. The TODI option would probably not be the best plan if any of the designated beneficiaries are spendthrifts or have tax liens or judgments against them (instead, a trust might make sense, where such beneficiary’s share is held in trust, so that the spendthrift’s creditors can’t access it and the spendthrift won’t spend their inheritance up quickly);
  4. The TODI option is not the best plan if any of the designated beneficiaries are receiving Medicaid benefits or are on SSI. A Special Needs Trust would need to be established for these beneficiaries;
  5. The TODI option might not be a good choice in a family where there is conflict among the designated beneficiaries or one of them is very unreasonable and would be a big problem to work with in maintaining and selling the real estate. In such a case it might make sense to have one or two persons in charge as executors or trustees to deal with the sale of the real estate and the disbursement of the sales proceeds; and
  6. A TODI doesn’t transfer ownership of any personal property in the real estate such as major appliances and other items in the home (washer, dryer, stove, refrigerator, freezer, curtains/drapes, etc.).

An owner cannot change the TODI except by signing and recording a revocation of the TODI with the recorder of deeds or by signing and recording a new TODI with the recorder of deeds.

When used in the appropriate circumstances a TODI can save a family considerable expense in estate administration and streamline the process of transferring title to residential real estate after the death of the owner.

This information is not to be considered legal advice. If you have questions about it, please contact us.

My Loved One Has Passed…Now What?

My Loved One Has Passed…Now What?

Your loved one just died – now what? Unfortunately, many people will have to ask themselves this question at least once in their lives. After you have time to grieve the loss, you will need to take several practical steps to administer your loved one’s estate.

Your first step should be to gather any estate planning documents owned by the decedent. If the decedent had a Will, the original Will needs to be filed with the court. You should also identify any other estate planning documents, such as a Trust.

Next, you will need to create an inventory of the assets, as you will not be able to properly administer an estate and/or trust unless you know what assets are in existence. After you create a list of the known assets, you should organize the inventory based on how the accounts are titled. Generally, an estate asset is any asset that is titled individually in the decedent’s name. Any assets that are titled jointly with another person or have a beneficiary designation are not estate assets. Rather those assets pass to the joint owner or beneficiary. A joint owner of any account will inherit the entire account. The beneficiary of any account should contact the financial institution; the financial institution will need a death certificate to verify the passing before the funds will be released to the beneficiary. Additionally, if there is a trust, any assets titled in the name of a trust are trust assets and should be a listed separately as a trust asset.

Now that you have a good idea of what the assets are, you are probably wondering how you administer and distribute the assets. If there are estate assets, the answer depends on the value of estate assets, meaning the assets held outside of trust and without any joint owners or beneficiary designations.  If the total value of estate assets, including real property, exceeds $100,000, Illinois requires a probate estate be opened in court. If there is less than $100,000 in estate assets, then you can instead complete a Small Estate Affidavit and avoid court proceedings. Whether the estate is administered in court or with a Small Estate Affidavit, the estate will be administered in accordance with the decedent’s Will or the Illinois Intestacy Statute, whichever applies. Trust assets will be distributed in accordance with the terms of the trust.

This summary is intended to give you a brief overview of the estate and trust administration process.  

This information is not to be considered legal advice. If you have questions about it, please contact us.

Why Not Use A Power Of Attorney From The Internet?

Why Not Use A Power Of Attorney From The Internet?

A durable power of attorney is one of the most important estate planning documents you can have. It allows you to appoint someone to act for you (your “agent” or “attorney-in-fact”) if you become incapacitated. Without a power of attorney, your loved ones would not be able to make health care decisions for you or manage your finances without asking the court to appoint a guardian, which is an expensive and time-consuming process.

There are many do-it-yourself power of attorney forms available; however, it is a good idea to have an attorney draft the form for you. There are many issues to consider and one size does not fit all.

The agent’s powers: For healthcare; you may wish to provide additional guidance on how you The power of attorney document sets out the agent’s powers. Powers given to an agent typically include buying or selling property, managing a business, paying debts, investing money, engaging in legal proceedings, borrowing money, cashing checks, and collecting debts. They may also include the power to consent to medical treatment. Some powers will not be included unless they are specifically mentioned. This includes the power to make gifts and the power to designate beneficiaries of your insurance policies.

The power to make gifts of your money and property is a particularly important power. If you want to ensure your agent has the authority to do Medicaid planning on your behalf in the event you need to enter a nursing home, then the power of attorney must give the agent the power to modify trusts and make gifts. The wording in a power of attorney can be significant, so it is necessary to consult an attorney.

Springing or immediate: The power of attorney can take effect immediately or it can become effective only once you are disabled, called a “springing” power of attorney. While a springing power seems like a good idea, it can cause delays and extra expense because incapacity will need to be determined. If the power of attorney is springing, it is very important that the method for determining incapacity is clearly spelled out in the document.

Joint agents: While it is possible to name more than one person as your agent, this can lead to confusion. If you do have more than one person named, you need to be clear whether both parties need to act together or whether they can each act independently. It might make more sense and be less confusing to name an alternative agent to act in case the first agent is unable to.

Appointing a guardian: Another use of a power of attorney can be to nominate a guardian in case guardianship proceedings become necessary. Including your preference for a guardian can allow you to have some say over who will be managing your affairs. Usually, the court decides who will be chosen as a guardian, but in most circumstances, the court will abide by your nomination in the durable power of attorney.

Executing the power of attorney: To be valid a power of attorney must be executed properly. Some states may require a signature, others may require the power of attorney to be notarized, and still others may require witnesses. It is important to consult with an estate-planning attorney in your state to ensure your power of attorney is executed properly.

Accepting a power of attorney: Even if you do everything exactly right, some banks and other institutions are reluctant to accept a power of attorney. These institutions are afraid of a lawsuit if the power of attorney is no longer valid. Many banks or other financial institutions have their own standard power of attorney forms. To avoid problems, you may want to execute the forms offered by the institutions with which you have accounts.

This information is not to be considered legal advice. If you have questions about it, please contact us.

Role Of Being The Agent Under Power Of Attorney For Property

Role of Being The Agent Of A Loved One’s Power Of Attorney For Property

Your mother (or another loved one) just gave you her Power of Attorney for Property document, and it names you as her agent. What responsibilities do you have? Well, to begin with, you don’t necessarily have to accept the job as her agent. You can decline to act. Also, your job as agent doesn’t start until the document becomes effective. Most Illinois Powers of Attorney for Property are effective at the time of signature, but some, known as “springing” powers of attorney, are not effective until the time that a certain condition has occurred, for example, a physician has certified in writing that your mother has become mentally incapable of making financial decisions. Even if the document is effective immediately, your mother may be perfectly capable of managing her own finances and does not want you to act until she is unable. Your job doesn’t start until your mother reasonably expects you to act.

While you do not have to accept the job of property agent, if you do act as agent, Illinois law imposes upon you duties that continue until you resign or the power of attorney is terminated or revoked. Your duties as agent include:

You, as agent, must do what you know your mother reasonably expects you to do with her property. For example, if your mother has had a long history of investing her money in Certificates of Deposit in her favorite banks and has made it clear she doesn’t want her money to be in the stock market, it is reasonable for her to expect you to keep her funds in Certificates of Deposit and that’s what you are expected to do. If you don’t know specifically what your mother might reasonably expect and have no way to find out, then you need to act prudently and diligently.

You must act in good faith for the best interest of your mother, using due care, competence and diligence. If you have special skills or expertise, you must use them while acting as agent for the benefit of your mother. Good faith means that you must have honest and sincere intentions. You should not take action with your mother’s property for some purpose other than for your mother’s best interest, for example, by liquidating a Certificate of Deposit that is payable on death to your brother for the primary purpose of disinheriting your brother from receiving that Certificate of Deposit. Competence and diligence have their ordinary meanings. You should not undertake to do something you have no competence to accomplish on your own, like preparing your mother’s tax returns when you have no expertise to competently prepare them. Diligence means that you must be on top of what you are doing for your mother, like paying her bills on time to avoid penalties and interest. Finally, if you do have special skills, say, you’re a Certified Public Accountant, you need to use your knowledge in acting for your mother meaning that you should take into consideration the tax consequences of your actions.

You must keep a complete and detailed record of all receipts, disbursements, and significant actions conducted for your mother. Not only must you keep a detailed record of all transactions you have engaged in for your mother, for example, bank statements, cancelled checks, bills and receipts, but you must give this record to your mother if she requests it, or to any other person acting as a fiduciary to your mother, such as her health care agent, attorney, accountant or trustee. If someone makes a report to the Illinois Elder Abuse and Neglect Program, and a caseworker from that program asks you for an accounting of your actions as agent, you must also provide your records to that caseworker. The best defense to any accusations which may be made against you is to have a complete record and explanation of all actions you have taken for your mother. At your mother’s death, the beneficiaries of her estate have a right to demand an accounting from you.

You must attempt to preserve your mother’s estate plan, to the extent you actually know it, if preserving the plan is consistent with your mother’s best interest. If your mother has set up accounts with payable on death beneficiaries or joint tenants, you should keep that in mind in spending her estate in order to preserve her overall plan. If your mother needs to spend her estate for her own best interests, the fact that there are death beneficiaries does not prevent you from spending these funds.

You must cooperate with a person who has authority to make health care decisions for your mother. If your sister is making health care decisions for your mother under a health care power of attorney, and she determines after consulting with your mother’s physicians that your mother requires caregivers and hires them, you must cooperate by paying for those caregivers. There are some actions which are strictly forbidden. Agents acting under powers of attorney for property must not do the following:

You must not act so as to create a conflict of interest that is inconsistent with your responsibilities as agent for your mother. For example, you would have a conflict of interest if you decided to buy your mother’s house or car as you would be in a position as agent of negotiating the price with yourself, individually, which is a conflict of interest.

You must not do any act beyond the authority granted to you in your mother’s power of attorney. There are certain authorities which are not granted to agents in the statutory power of attorney for property language unless specifically added. Unless added, agents have no authority to make gifts, name or change joint tenants or name or change beneficiaries. If you act to make gifts from your mother’s property when her power of attorney does not include that power, you would be acting beyond your authority.

You must not comingle your mother’s funds with your funds. You must keep your funds and property completely separate from your mother’s. Never deposit your mother’s funds into your own account, or vice versa.

You must not borrow funds or other property from your mother unless the power of attorney specifically provides for it and it is not contrary to your mother’s best interests. Even if your mother’s document clearly states that you are allowed to make loans to yourself, it is unlikely that there would be a circumstance where loaning yourself funds from your mother would not raise suspicion. You should not make loans to yourself without specific authority in the document and without getting legal advice.

You must stop acting as agent on behalf of your mother if you learn of any event that terminates the power of attorney or your authority under the power of attorney. The power of attorney for property terminates at your mother’s death, and you are not authorized to act after you are aware of her death, or are aware that your mother has revoked your power of attorney.

You must always disclose your status as agent for your mother when acting for your mother. You are not authorized to sign your mother’s name. If you are signing as agent for your mother, you must sign as follows:

“Mother’s name” by “Your name”, as agent.

If you violate any of these duties or act outside the authority granted to you under your mother’s power of attorney for property, you may be liable for any damages, including attorney’s fees and costs, caused by your violation. If you have any questions or doubts about what actions you are authorized to take as agent for your mother, you should consult an elder law attorney.

This information is not to be considered legal advice. If you have questions about it, please contact us.

Palliative Care And Supportive Care

Palliative Care And Supportive Care…Improving Quality Of Life

Living with a serious illness can create physical challenges like pain, symptoms or side effects from medication… and even emotional concerns like anxiety or depression…that can affect your quality of life.

Palliative care is specialized medical care for people with serious illnesses, offering expert pain and symptom management to treat the whole person, at any age, and at any stage of illness.

A team of palliative medicine and supportive care experts provide highly coordinated medical care that improves quality of life while your physicians work to cure or manage your condition. Palliative care can help you gain strength, improve your ability to tolerate medical treatments and live a longer, better life.

The New England Journal of Medicine reported that patients with serious illness who accessed early palliative care support in addition to standard treatments had improved symptom control, enhanced quality of life and lived longer than similar patients who had treatments without palliative care support.

Is Palliative Care The Same As Hospice?

Palliative care helps manage pain and symptoms and improve your quality of life at any stage of illness. It can be provided in conjunction with treatments intended to cure the illness.

Hospice is for patients whose doctors have determined they likely have less than six months to live, and who want their care to focus on comfort and quality of life.

Choosing Palliative Care

Palliative Care can help patients living with serious or life-threatening illnesses, such as:

  • Cancer
  • Dementia
  • Diabetes
  • Heart disease
  • Kidney disease
  • Lung disease
  • Neurological disorders like multiple sclerosis (MS), Parkinson’s Disease and amyotrophic lateral sclerosis (ALS)
  • Stroke

Paying for Palliative Care

Palliative care is a clinical consultation service that is covered by most insurance plans, including Medicare and Medicaid. Consultations are billed under Medicare Part B, similar to a physician’s visit. Standard co-pays apply.

Anyone can request a consultation in palliative medicine and supportive care. Often, the patient’s doctor makes the recommendation. A patient or family member and contact the palliative care provider directly to schedule a consultation.

This information is not to be considered legal advice. If you have questions about it, please contact us.

Do I Really Need A Living Trust?

Do I Really Need A Living Trust?

A geriatric social worker recently shared with us a conversation he had with an older woman who attends the senior program the social worker manages. The older woman, who I will refer to as Mrs. G, told the social worker that she attended a free seminar on living trusts after learning about the seminar from an advertisement in her local newspaper. Mrs. G told the social worker that the seminar discussed how living trusts help people avoid having their estates managed by a complicated and expensive legal process after they die. The social worker knew from previous conversations with Mrs. G that she did not want to burden her children in any way, including with her estate issues after she dies. Therefore, the social worker was not greatly surprised to learn that, shortly after attending the seminar, Mrs. G contacted the attorney who presented the seminar and paid the attorney to create a living trust for her.

When the social worker relayed Mrs. G’s story to me, he sounded concerned about whether Mrs. G. had made a good decision. Mrs. G told the social worker that she paid the attorney a lot of money to create the living trust and she believed the money was well-spent. The social worker explained to me that Mrs. G is of very modest means, owning a savings account worth $10,000 and a mobile home of nominal value. The social worker asked me whether someone like Mrs. G, with so few assets and minimal savings, truly benefits from having a living trust. Below is a summary of my response to the social worker regarding living trusts, generally, and, specifically, my thoughts on Mrs. G’s situation.

Living Trusts: A Way to Avoid Probate?

Living trusts are commonly marketed to the general public as a way to avoid having one’s estate managed in probate court after one dies. Probate is the legal process of transferring assets from a person who has died to the person, people, or organizations designated in the deceased person’s will or, if no will exists, to the deceased person’s heirs. The general rule is that probate is necessary when a person dies and the assets owned solely by the person total more than $100,000 or include real estate—there are exceptions to this rule that an attorney may address after reviewing an estate. The probate process can sometimes be costly and time-consuming, especially for larger estates. For a small estate, however, the probate process can be efficient.

The theory behind a living trust, sometimes referred to as a revocable trust, is that, if all of a person’s assets are owned by his or her living trust at the time of the person’s death, then the person’s estate will not need to be managed in probate court. This is because, as a general rule, courts do not oversee trust administration. Instead, the trustee of the living trust is charged with managing the trust. The person who creates the living trust may name himself or herself as trustee; often times, however, the person creating the trust names as trustee a close friend, family member, or institution, such as a bank. The person creating the trust can also name a successor trustee to manage the trust in the event the original trustee dies or becomes unable to act as trustee, such as because of mental incapacity. Additionally, a living trust is revocable at any time prior to the death or permanent mental incapacity of the person who created the trust; in other words, once the person who creates the trust dies or becomes permanently mentally incapacitated the trust is irrevocable. In short, if all of a person’s assets are titled or otherwise included in the living trust, that person’s estate can avoid the probate process entirely.

There are other ways to avoid probate, however, which may be more appropriate for certain individuals than creating a living trust. For example, in Illinois, if a person leaves personal assets valued at $100,000 or less, such estate can avoid the probate process with a Small Estate Affidavit. A Small Estate Affidavit is a short document that lists the total assets in the estate and names the person or people who are entitled, according to the Illinois Probate Act, to receive those assets. Again, a Small Estate Affidavit is an option in Illinois only for estates that do not include real estate and with assets that total $100,000 or less—in other words, modest estates.

Another way to avoid the probate process is for a person to purchase certain kinds of assets prior to his or her death that allow the person to name a death beneficiary or a joint tenant of the asset. For example, most certificates of deposit, savings accounts, stocks, brokerage accounts, and many bonds can be made “payable on death” to a designated beneficiary or beneficiaries. Additionally, if an account names two joint tenants and one of the joint tenants dies, generally, the remaining living joint tenant automatically becomes the 100% owner of the account.

In Mrs. G’s case, a living trust was not her only option for avoiding probate. Because of the modest size of her estate, Mrs. G could have relied on a Small Estate Affidavit to ensure proper distribution of her assets at her death. Alternatively, Mrs. G could have named her children as death beneficiaries on her savings account. Either or both of these options may have been less costly for Mrs. G (and her estate) compared to the cost of paying an attorney to create a living trust.

Living Trusts: A Way to Plan for Incapacity?

A living trust is an effective way for one to ensure his or her estate is administered according to his or her wishes in the event the person becomes mentally incapacitated. As previously mentioned, the person who creates the living trust can name a successor trustee to manage the trust in the event the original trustee dies or becomes unable to act as trustee. Thus, if the person who created the living trust named himself or herself as trustee and then subsequently becomes unable to act as trustee due to his or her own mental incapacity, the successor trustee is then responsible for administering the trust pursuant to the terms of the living trust.

Another, potentially less expensive, alternative to a living trust for the purpose of planning for mental incapacity is a durable power of attorney for property. An Illinois Power of Attorney for Property gives the agent named under the document the authority to manage the financial affairs of the person who created the document, referred to as the principal. Additionally, the principal of an Illinois Power of Attorney for Property can, if he or she wishes to, specifically state in the document that the agent may act only after a physician determines that the principal is mentally incapacitated. Most financial institutions located in Illinois will accept a properly executed Illinois Power of Attorney for Property; however, out-of-state institutions holding an asset of the principal may not be as willing to accept the Illinois Power of Attorney for Property.

In Mrs. G’s case, her savings account is held at a local bank in Illinois and her mobile home is also located in Illinois. Thus, Mrs. G could have executed an Illinois Power of Attorney for Property to allow, for example, one of her children to make financial decisions on her behalf if she becomes mentally incapacitated in the future.

Living Trusts: Who Really Benefits from a Living Trust?

A living trust may be most appropriate for a person who owns sophisticated assets of substantial value or for estates with assets that have a total value of at least $100,000 or which include real estate. For example, if a person owns equities, such as stocks, corporate bonds, mutual funds, or brokerage accounts, exceeding $100,000 in value and/or the person owns valuable real estate, then a living trust is a very effective tool for avoiding probate. Additionally, in the event of mental incapacity, the trustee of a living trust generally has an easier time exercising authority than an agent under an Illinois Power of Attorney for Property with regard to financial management of stocks, bonds, mutual funds, brokerage accounts, and assets held in national institutions. Specifically, financial institutions located (or with national headquarters) out-of-state may impose additional requirements for an agent under an Illinois Power of Attorney for Property, making the document difficult or impossible to use.

Thus, for individuals like Mrs. G, with a modest estate valued at $100,000 or less and without real estate, a living trust may not be necessary or the most economical legal planning option.

This information is not to be considered legal advice. If you have questions about it, please contact us.

Digital Assets Can Raise Estate Planning Issues

Digital Assets Can Raise Estate Planning Issues

More and more, we are conducting our business on the Internet, whether that’s online banking, shopping, uploading documents and files to the “cloud,” posting videos, or communicating with ‘long lost’ friends.

So, what happens to all of our accounts and files when we become incapacitated or pass away? Will our representatives have access to them? Where will they find our usernames and passwords? Who can take down our Facebook and LinkedIn pages, or would we prefer that they continue for posterity? And, if we’ve saved photos, videos and other files on the cloud, who should have access to them and how long should they stay out there?

These are questions almost everyone needs to think about today, and they often raise difficult security and legal issues. For example, if you become incapacitated and your daughter starts handling your finances online, is she doing so legally? Presumably you’ve given her your consent to do so, but the bank may not have a durable power of attorney on file with this authorization. As far as the bank knows, you’re still the person logging in and paying your bills or shifting your investments. Is this fraud on the bank? Does anyone care as long as your daughter is acting in your best interest? And what if you pass away and your child, rather than notifying the financial institutions, continues to pay bills online and make distributions to family members? This is clearly contrary to law, but it could be much more convenient than going through the probate process. Is it an instance of no harm, no foul?

States are beginning to grapple with these issues. A few states have enacted laws, giving executors access to online accounts. In addition, every Internet provider has its own rules about access to user accounts, and generally users have agreed to these rules when they first enrolled, whether they actually read the service agreement or not. In April 2013, Google introduced the concept of an Inactive Account Manager who Google users can name to receive notice when a Google user has not accessed his/her account for a long period of time. The Inactive Account Manager has access to Google accounts designated by the user and can take whatever action is necessary to access them or shut them down.

The legalities aside, here are some steps we can all take to better manage our digital assets:

  • Inventory your digital estate. Make a list of all of your online accounts, including e-mail, financial accounts, social networking sites and anywhere else you conduct business online. Include your username and password for each account. Also, include access information for your digital devices, including smartphones and computers.
  • Store the list in a safe place. There are a number of options for where you and your representatives can store the list, each with its own problems. If you have the list on paper, someone who you don’t trust might discover it and gain access. You can keep it in a safe deposit box but does your representative know where the box key is located? If you keep the list online, make sure you do so securely.
  • Give access to your personal representatives. Once you have your inventory, you will need to provide it to the people who will step in if you become incapacitated or pass away, or let them know how to find it when and if they need to do so. Make sure that they save the information as securely as possible.
  • Authorizing language. Make sure the agent under your durable power of attorney and the personal representative named in your will have authority to deal with your online accounts.
  • Update the inventory. As you open new accounts and services, purchase new devices, and change usernames and passwords, you will have to update your list so that it remains current.

This information is not to be considered legal advice. If you have questions about it, please contact us.

Choosing Your Fiduciaries

Choosing Your Fiduciaries

In planning your estate, among the most important decisions you will make will be your choice of those persons who will be your fiduciaries – the persons you will entrust with your financial well-being and personal health decisions. Those fiduciary positions are your agents under power of attorney for property and power of attorney for health care, trustees, and executors. In making these choices of persons to act as your fiduciaries, keep in mind what will be expected of them and what authority they will hold.

Power of Attorney for Property

A Power of Attorney for Property is a document that allows you to delegate authority to another person, known as your agent, to act on your behalf. The agent may be authorized to act immediately, or only when you are no longer able to act for yourself (known as a “springing” power of attorney). Examples of the types of authorities you will delegate to an agent under power of attorney include paying your bills, managing your investments, and buying and selling real estate. A Power of Attorney for Property can be limited to one decision, or it can be so broadly written that the agent can do almost anything on your behalf. The authority you give is dependent upon the document’s language. When you are deciding on an agent during the estate planning process you are likely going to grant that agent broad powers as it is not possible to foresee what you will need the agent to do for you in the future.

Powers of attorney are a wonderful tool in the hands of a trustworthy person. Because it comes with tremendous authority, it can be a dangerous tool in the hands of the wrong person.

Who is the wrong person?

  • Someone with a history of personal financial problems of their own.
  • Someone with a mental illness or substance abuse issues.
  • Someone who is unable to manage their own financial affairs.
  • Someone who has no knowledge of investments or finances.
  • Someone who has personal conflicts with your other family members.

Who is the right person?

  • Someone whom you trust without hesitation.
  • Someone who manages their own finances well.
  • Someone who understands investment and finance.
  • Someone who has no history of financial problems and is not in debt.
  • Someone who has the time and willingness to step in and help you if necessary; and
  • Someone who does not have conflicts with your other family members.

It is a mistake to name a child just because he or she is the first born, or to name a child because you are concerned about hurting their feelings. Carefully consider a child’s strengths and weaknesses, and potential for misusing or neglecting their job as your financial agent. It sometimes makes sense to name a person other than a child.

Power of Attorney for Health Care

A Power of Attorney for Health Care is a document that allows you to delegate authority to another person, known as your agent, to make broad health care decisions for you if you become unable to make those decisions for yourself. The agent has authority to decide on all health and care decisions, i.e., withdrawal of life support, treatment decisions, placement in residential care facilities, and home care arrangements.

Who is the right person to choose as your health care agent?

  • Someone who is willing and able to spend time advocating for your care.
  • Someone who is assertive and willing to research medical options and discuss them with your physicians.
  • Someone who understands your end-of-life preferences; and
  • Someone who is able to make the difficult decisions you entrust to them, consistent with your wishes.

Who is the wrong person to choose as your health care agent?

  • Someone who does not have the time to spend advocating for you.
  • Someone who is not interested in medical issues or not able to be assertive with the medical system.
  • Someone who may have conflicts, such as a dependent child who lives with you; and
  • Someone who does not understand your end-of-life preferences or who is unable to implement your end of life wishes.


Your executor is the person you select to have the legal responsibility to settle your estate when you die. An executor usually is only necessary if you do not have a trust in place. He or she will:

  • Coordinate probate matters with your family attorney.
  • Take custody of and value all your estate assets.
  • Pay all creditors’ claims.
  • Close your bank and investment accounts and transfer them to newly created estate accounts; and
  • Distribute your assets to the beneficiaries you’ve chosen in your Will.


If a revocable living trust is part of your estate plan, you will need to choose a successor trustee to step in and act if you become unable to act. Your trustee is someone you choose to be legally responsible for managing, investing and distributing your trust assets in accordance with your wishes, and for acting in the best interests of your beneficiaries. His or her responsibilities include:

  • Filing income tax returns of the trust
  • Trust accounting and administration
  • Investment management trust assets
  • Trust distributions to beneficiaries in accordance with the trust terms
  • Regular communication with and reporting to all of your trust beneficiaries
  • Coordinating trust distributions with public assistance payments to a special needs beneficiary

If none of your close friends or family members are capable, you should consider enlisting the services of a professional fiduciary, such as a bank trust or trust company. It is important not to name a person who has conflicts with any of your beneficiaries.

Having the right persons in place to handle your financial and health care decisions for you in the event you become unable to do it for yourself is critical. Give adequate consideration to your choice of agents, trustees and executors.

This information is not to be construed as legal advice. If you have questions about it, please contact us.

A Planning Guide For Parents Of Children Who Have Special Needs

A Planning Guide For Parents With Children Who Have Special Needs

Below are action items to take when you have a child, of any age, who has special needs.

Personal Information

Keep all of your records and your child’s personal information (name, nicknames, date and place of birth, phone numbers, Medicare number, Medicaid number, addresses, etc.) in an accessible place. You should also keep a separate folder with copies of birth certificates, adoption papers, military service records, passports, deeds, health insurance cards, insurance policies, stock certificates, marriage and death certificates of parents, Social Security cards, automobile titles, divorce decrees, usernames, and passwords.

Emergency Contacts

Create a document listing emergency contacts for you and your child. Include contact information for your spouse, partner, significant other, children, siblings, and parents. For your child, you should have the name and all of contact information of the person(s) you want to care for your child in case of an emergency.

Medical Providers and History

This list should include the names and contact information of primary care providers and specialists, medications, allergies, significant family history, insurance companies and policy numbers, health insurance, medical equipment providers, therapists, independent service coordination agency, care managers and any Medicaid or Medicare information. If you have prepaid your or your child’s funeral or burial, keep this information here as well. If your child is still in school, include information about his or her school, individual education plan, and staff at the school who work with your child.

Financial Information

Create a document for financial information. This includes the gross and net amount of each source of annual income (employment, social security, supplemental security income, etc.) and current value of assets such as home, car, stock, trusts, etc., the death benefit (if any), and all beneficiary designations associated with the asset. Also include policy numbers and contact information, the names of any of you financial advisors, a copy of your most recent tax return, information on property taxes or rental lease and a section on recurring bills, including whether the bill is paid on-line or by an automated payment. If you have a safe-deposit box, where is the key? For your child, you should include all information concerning his or her representative payee accounts and special needs trust accounts. Copies of statements should be kept in a safe place or scanned and stored securely online.

Legal Information and Documents

Do you have a power of attorney for health care, power of attorney for property/finances? A will? A living trust? have you created a special needs trust for your child? If yes, where are these documents? Do you have any contract or loans? Make sure to keep the documents up-to-date and have the current contact information for your attorney, executors, agents, trustees, beneficiaries, etc.

If you don’t have legal documents, meet with an attorney who concentrates in assisting people who have special needs. This is a specialized area of law and not all attorneys have the understanding, experience, nor compassion to assist you. Not only can an attorney draft the necessary documents for expressing how you want your property, finances, health care, and care of your children handled following your death and/or incapacity, but your attorney can also help you set up financial strategies, such as trusts, to ensure that your child with a disability can continue to maintain a quality life when you are gone. The attorney should also be familiar with Medicare, Medicaid, Social Security, and Supplemental Security Income (SSI) and the unique challenges that a disability brings to the estate planning process. This attorney can also assist to determine what arrangements should be made for you or your child at death.

Public Benefits

Investigate what public programs your loved one qualifies for and / or is entitled to.

Social Security: A Federal insurance program that provides benefits to people who are retired, unemployed, or have a disability. There are three main types: Social Security Retirement Income (SS), Social Security Disability Income (SSDI), and Supplemental Security Income (SSI)

Medicare: A national health insurance program that is primarily for people aged 65 and older but also for some younger people who have a disability status as determined by the Social Security Administration, and people with end stage renal disease and ALS.

Medicaid: A program supported with Federal and State Funds that helps with health care costs, facility based, and personal care services. In Illinois, the “Medicaid Agency” is the Illinois Department of Healthcare and Family Services. For determination of eligibility, Illinois Department of Human Services is the coordinating agency.

Medicaid Waivers: state-run programs that use federal and state funds to pay for services for people with certain health conditions. They permit states to use flexibility to design publicly financed health care systems outside of certain federal Medicaid statutory and regulatory requirements. Each state has different Waivers with different eligibility requirements or services. Illinois has nine (9) Home and Community-Based Service (HCBS) waivers. Each waiver is designed for individuals with similar needs and offers a different set of services.

SNAP (Supplemental Nutrition Assistance Program): a federal program that provides food-purchasing assistance that is coordinated the Illinois Department of Human Services PUNS List (for people who have a developmental disability). Work with your local Independent Services Coordination Agency (ISC) to be included on the PUNS list. It is for anyone who may need help from the government to pay for services now, or in the future. To locate your ISC, you can go here or here.


If you are the guardian of your child, make sure you identify the people to succeed you if you are no longer able to serve. If you do not have a guardianship for your child but believe it may be needed after your death, you should discuss this with your attorney and obtain advice on the steps to take to be sure your child will be protected. Your planning should include identifying possible guardians and making sure those individuals understand the steps they will need to take to have the court appoint them for that role.

Review and Update your Plan

Remember that planning for the future is a process, not a one-time task. As circumstances change for you and your child, you will need to revisit your plan annually.

This information is not to be considered legal advice. If you have questions about it, please contact us.

ABLE Accounts Come To Illinois

ABLE Accounts Come To Illinois


“ABLE” Accounts are a recent creation of federal law designed for individuals with disabilities to allow them to have a tax-free savings account which does not affect eligibility for public benefit programs such as SSI and Medicaid. States must establish the ABLE Account Programs. The new Illinois ABLE Account program is administered by the Illinois Treasurer’s office.

An ABLE account may be owned by a person with disabilities who became disabled before reaching the age of 26. Funds held in ABLE accounts grow tax free and may be used for “qualified disability expenses”. Each person may have only one account in the nation. The maximum annual contribution to an ABLE Account is $14,000 from all sources, and contributions must be in the form of money. A designated representative who may be a guardian, agent under power of attorney for property, or a properly witnessed written designation, may act on behalf of the owner with disabilities.

“Qualified disability expenses” means any expenses related to the eligible individual’s disability which are made for the benefit of the eligible individual who is the account owner, including the following expenses: education; housing; transportation; employment training and support; assistive technology and personal support services; health; financial management and administrative services; legal fees; expenses for oversight and monitoring; and funeral and burial expenses.

ABLE accounts, income and qualified distributions do not affect the owner’s eligibility for SSI and Medicaid. However, to maintain eligibility for SSI, the account value cannot exceed $100,000. To maintain eligibility for Illinois Medicaid, the account value cannot exceed $350,000. If there are funds remaining in the ABLE Account at the owner’s death, States that provided medical assistance, including services under Medicaid home-based programs, are paid back from the remaining funds in the ABLE Account.

Although there are drawbacks, ABLE accounts can be very useful. An ABLE account is useful where a relative has left an inheritance of less than $14,000 directly to an individual with disabilities who is receiving Medicaid or SSI. ABLE accounts could also be used to avoid the 1/3 reduction in SSI for family contributions to the individual’s food and shelter expenses. If the family contributes the funds for food and shelter to an ABLE Account, its use will not cause the 1/3rd reduction to SSI as it would if such funds came directly from the family or a special needs trust. Before considering an ABLE account you should consult with an experienced special needs planning attorney. The National Academy of Elder Law Attorneys is able to provide referrals. You can also go to the State of Illinois Able Account program for more information.

This information is not to be considered legal advice. Finally, if you have questions about the ABLE program, you can contact us.