Lawyers With Purpose

(Shhhhh.....) Client vs. Lawyer: TMI

The best way to illustrate the topic of this post is with the following joke:

A man is flying in a hot air balloon when he realizes he is lost. He reduces his altitude and spots a man in a field below. He lowers the balloon toward the man and shouts to him, “Excuse me, can you help me? I am late to meet a friend, but I don’t know where I am.”

The man below says, “I’m happy to help. You are in a hot air balloon, hovering approximately 30 feet above this field. You are between 40 and 42 degrees N. latitude, and between 58 and 60 degrees W. longitude.”

After a brief pause, the balloonist declares: “You must be a lawyer.”

“I am” replies the man. “How did you know?”

“Well,” says the balloonist, “everything you have told me I am sure is technically correct, but I have no idea what to make of your information, and the fact is I am still lost.”

The man below responds, “Indeed. And you … you must be a client.”

“Why, yes, I am,” replies the balloonist, “how in the world did you know?”

“Well,” says the man, “you don’t know where you are, or where you are going. You have made a promise that you have no idea how to keep, and you expect me to solve your problem. The fact is you are in the exact same position you were in before we met, but now it is somehow my fault.”

(From http://www.milwaukee-business-lawyer.com/my-favorite-lawyerclient-joke/)

Funny, right? But how true! Most of our clients and their families come to us for answers or solutions in the form of information, but sometimes the very information for which they pay us, and that they desperately need, is the source of much frustration and confusion for them. Why is that and what can you do to remedy the situation? One of the most common issues that may occur when relaying information to a client regarding a VA claim is giving too much or too little information. You can also have problems if you do not time the release of information correctly, or worse yet, give out the wrong information.

Some of this is undoubtedly beyond one’s control. For example, gauging the amount of information that your client is going to expect and want has a lot to do with that individual’s particular personality or social style. You can often tell from initial contact if your client or client’s family is going to participate actively in their planning and the application process versus how much they want you to just take care of everything and leave them out of it. Thus you may have to adjust your response and the amount of information you provide to meet individual needs on a client-to-client basis. As a good baseline, resist the urge to discuss how the sausage is made. I actually prefer clients who are engaged in the process and seek to comprehend the information they are given. Clients like this can be strong allies in the process of getting a VA claim completed and filed, as well as great referral sources because they appreciate how much work is entailed.

However, regardless of what the client may want, there is obviously a lawyer’s duty to the clients to keep them informed concerning their representation. Per the Preamble of the American Bar Association’s Model Rules of Professional Conduct, a lawyer's responsibilities include the following: “As advisor, a lawyer provides a client with an informed understanding of the client's legal rights and obligations and explains their practical implications. . . . As an evaluator, a lawyer acts by examining a client's legal affairs and reporting about them to the client or to others.” At the very least, someone in the family has to be made aware of the most basic information regarding the legal services you are performing for them: what you are doing, what is happening next, and what to do if circumstances change.

While you can’t always choose the personality of your client, factors like bad timing of information or giving out wrong information are largely ones that you should be able to control. By bad timing, I mean giving information when it is not required at that particular moment. This could be as simple as explaining the VA appeals process when you haven’t even filed an “Intent to file claim” form yet. It could also be giving necessary information too late to be of use. The best way to avoid either is to anchor back to your VA process and advise and inform your client at every major step as to what you have just done and what to expect next. Also systematize what information should be given at each stage using client handouts, correspondence templates, etc., so the client receives the information when needed and not afterwards. While there is no problem with giving the client an overall summary of the process, avoid giving too much information for future stages in the process that may in fact never occur.

The problem with giving a client the wrong information should be self-evident. The rules and laws impacting VA eligibility can be complex, but there is a wealth of resources online, including original sources like the Code of Federal Regulations and the VA Adjudication manuals, both of which are available at the VA’s Web Automated Reference Material System and which should be consulted regularly to ensure the accuracy of what you are telling your clients. Organizations like Lawyers with Purpose are also indispensable for the support they provide in the form of legal/technical learning opportunities and a network of colleagues facing the same challenges who are ready to answer your questions or act as a sounding board for your daily dilemmas. If you choose to make the time to use the resources available, you can ensure that you do not make the mistake of giving the wrong information.

Are you interested in learning more about the Lawyers With Purpose Estate Planning Trust Drafting Software?  If so, click here and we'll hop on a call with you and show you how it works first hand!  We think it's the best thing out there and are confident you will too after you see it for yourself. Click here now and we'll take it from there and start walking you through the difference it will make to your estate and/or elder law practice.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.

Congratulations to Churchill Law Office, Lawyers With Purpose Member of The Month!

Churchill Law Office answered this from a team perspective, not an attorney perspective.  We think it's awesome!  What do you think?

What is the greatest success you’ve had since joining LWP?

Maintaining a successful firm even after crisis occurred when the Attorney was in a car accident.   A large portion of our success is the Actionstep platform and having the technical knowledge within the office to program and automate everything and staying in the black!

What is your favorite LWP tool?

This is a cop-out, but they are all amazing in that they have assisted us to maintain even in crisis.   The way the stories tie to the Estate Plan Audit, and then the Vision Clarifier have been a massive support in reminding clients of their goals in follow-ups.

How has being part of LWP impacted your team and your practice?

Being able to call for help.  The greatest example is one, Nedra’s constant ideas, two, Candace’s drive to move forward, and most of all, three, without Molly “encouraging”, e.g. “do it”, with regard to us doing Vision’s without the Attorney, we would have had to close the office after Debbie’s accident.

Share something about yourself that most people don’t know about you.

Beth is a very experienced database and lean management trainer!  Beth is a bit of a recluse.

Melissa worked for 14 years in daycare and this is her first office job and has surpassed any assistant we’ve ever had in the office.  Melissa is a HUGE prankster.

John has extensive experience in programming and automates everything in Actionstep beyond its basic programming.  John has played the piano for 30 years.

Debbie is a successful attorney with a secret passion for beading!  She makes most of her own jewelry.

Terry is retired, and was an instructor helicopter with the Guard before joining our team.  He makes a mean chocolate chip cookie for the clients.

What is your favorite book and how did it impact your life?

John – Technical programming books.  It has advanced his piano recording and office efficiency.

Melissa – To Kill a Mockingbird – It makes her sound more sophisticated when asked what her favorite book is.

Beth – Machine that Changed the World – Has simplified her life both at home and work through lean management.

Debbie – The Biology of Belief – Helps her to grow spiritually.

Terry – Killer Angels – Loves history and it a great portray of struggle, honor, and patriotism.

 

Estate Planning & Tax Basis Basics

When doing estate planning, it is critical that the attorney is aware of the basic tax basis issues and their impact on estate planning.

Tax “basis” is a term related to income taxes. The “tax basis” of an asset owned by an individual can change based upon the type of asset, when it was purchased, and the value at sale or death of the owner. So let's start with the basics. Most principal assets are purchased. This includes stocks, bonds, mutual funds, real estate, and even businesses, among other things. When you purchase a principal asset, the IRS looks at the value of that asset when purchased to determine what, if any, income tax should be paid when and if it is later sold. For example, if you buy a stock at $10 per share and hold it for a period of years and then sell it when it is worth $15 a share, the IRS will identify your tax basis as $10 and your sale value at $15 to net an income taxable amount of $5 per share (aka “capital gains”). Over the years, the government has taxed capital gains differently from ordinary income.

There are additional issues to consider with basis. For example, it can change if you own real estate, and if it is used as a business (rented out to others), you can “depreciate” the real property. Depreciation is a non-cash-flow expense against your income. For example if you buy a commercial building for $250,000 and rent it out, in addition to the regular expenses incurred each year from your cash flow, including interest, taxes, insurance, utilities, and general maintenance, the IRS also allows you to take a depreciation expense that represents a percentage of the value of the real estate. Traditionally, depreciation periods are over 27½ or 39½ years. So a $250,000 building divided by 39½ years provides for the annual depreciation amount of $6,329. While the IRS allows you this deduction, you do not have to pay anybody anything to get the deduction. In contrast, however, the $6,239 depreciation deduction reduces your basis in the real estate. So, for income tax purposes, your building no longer has a basis of $250,000, but now $243,761. As you continue to own the building and take the depreciation expense, your tax basis in the real estate continues to decrease, thereby leading to a greater potential income tax when the property is later sold. If the property had been depreciated for 10 years, the basis would have been reduced by $63,390, netting a new tax basis of $186,710. If later sold for $350,000, a capital gain will be assessed on the difference between the sales price and no adjusted basis ($163,290), not the original purchased price and sales price ($100,000).

Finally, it is important to note as an estate planner that tax basis gets automatically “stepped up” if you own the asset at death. Under the previous scenario, if you bought a stock for $10 that grew to $15 or you owned a piece of property that you paid $250,000 for and depreciated $63,000, when you die, both are revalued at your date of death and the values are included in your taxable estate for estate tax purposes. The good news is their estate tax does not trigger any actual payment requirement unless the estate exceeds $5,430,000. Conversely, while it does not incur an estate tax, the beneficiaries get a “step up” in basis after the death of the original owner to the value at date of death, so any subsequent sale after death will yield no income taxes. When planning, sometimes holding assets until after death has a strategic advantage if they are significantly appreciated.

This is also true in charitable planning. If assets that have been appreciated are donated to charity prior to death, the donor will receive an income tax charitable deduction equal to the fair market value, not the tax basis, but there are limitations on the charitable deduction if the contribution was made from appreciated assets. A charitable contribution made with a full basis asset (i.e. cash) can be deducted up to 50 percent of the donor’s adjusted gross income, whereas the deduction for a charitable donation of appreciated property is limited to 30 percent of adjusted gross income. The biggest advantage, however, comes from individuals waiting until after death to convey their highly appreciated assets, so no capital gains tax is incurred to the client (because they didn’t sell it during life) nor the beneficiary (because they received a “step up” in basis). Understanding tax basics is critical to ensure that you always consider the income tax impacts when signing in the short and long term for a client.

If you are interested in learning more about Lawyers With Purpose and in particular how our Client Centered Estate Planning Drafting Software can make a difference in your estate and/or elder law practice, just click here and schedule a day/time that works for you to discover it for yourself - first hand.  Just show up with any questions you have!  We've got the answers!

David J. Zumpano, Esq, CPA, Co-founder Lawyers With Purpose, Founder and Senior Partner of Estate Planning Law Center

Do You Hold Your Client's Hand Through The Planning Process...

I was walking to the park with my daughter when she asked me to hold her hand. There is no feeling like my child’s hand in my own. But I was confused when, as we were holding hands, my daughter said, “No, Mommy, hold my hand.” I thought I was. I was not. Rather, I was letting her hold my hand. My fingers were still outstretched and not wrapped around her hand. She wanted the security of my hand holding her tightly.

In our law firms, how often do we believe we are holding our client’s hand when actually we are not? We feel we are providing a top-notch service but we are not. Are we holding their hand or really just letting them hold ours?

Becoming eligible for and applying for veterans benefits is complicated. The client must be instructed step-by-step through the process. The same is true for Medicaid applicants. From the time the client engages our services through the receipt of a benefits award, we are regularly communicating and giving instruction. I know we have stopped holding their hand when the client calls and says, “Why isn’t this going faster?” or “I’ve paid all this money and I don’t think we’ve gotten our money’s worth,” or “It just doesn’t feel worth this trouble,” or “I wish I had not even hired you.”

Those are not words you want to hear from a client. They are often followed by words that sound like “refund.” It is easy to get defensive and blame the system or the VA. But what is really happening? We have stopped holding our client’s hand and just let them hold ours. We have stopped providing them the security they need to feel safe and confident in us.

Perhaps not everyone on the team even knows they are supposed to hold your client’s hand. My marketing director was speaking with a nursing home administrator during a synergy meeting. The nursing home administrator asked, “Do you hold your client’s hand through the process?” My marketing director said, “Oh, no, we don’t hold their hands.” When I heard that, I was confounded. How could he say such a thing when we work so hard to please our clients? His definition and my definition of holding hands was different. Just like when I was holding my daughter’s hand, her definition was different from mine. Her expectation was different from mine.

I encourage you to review your office procedures and processes. Are you providing to your client the sense of security you believe you are providing? Are you meeting the expectations you have given your clients? Where can you more securely hold their hand? Just a slight adjustment will make a huge difference to them. Now, when I hold my daughter’s hand, I pay close attention to ensure that my fingers wrap around her hand, as she wants, expects and needs.

If you would like a free eBook and discover the secret smart estate and elder law attorneys use to run their practice and generate success by design rather than default click here to download "The Five Essential Roles For A Successful Practice".

Victoria L. Collier, Co-Founder, Lawyers with Purpose, LLC, Certified Elder Law Attorney through the National Elder Law Foundation; Fellow of the National Academy of Elder Law Attorneys; Founder and Managing Attorney of The Elder & Disability Law Firm of Victoria L. Collier, PC, www.ElderLawGeorgia.com; Co-Founder of Veterans Advocates Group of America; Entrepreneur; Author; and nationally renowned Presenter.

The Reason Your Image Is Everything

A few months ago, I arranged a lunch meeting with another attorney whose office was close to mine and whose practice area complemented mine. I had researched her on the Internet and was impressed with her resume and her “look.” When we met at lunch, I thought I had researched the wrong person. The woman sitting in front of me was not who I remembered on the website at all. Once we finished our lunch, I immediately went back to the office and checked the website. It was definitely her, about 15 years before.

That made me think: “What perception are we giving to the public that is not accurate about our law firms?” What image are we projecting that is not an accurate reflection of us? Is the client sitting in a meeting distracted about how different I look from my website instead of listening to all the legal wisdom I have to share? Are clients wondering why I haven’t taken the time or spent the money to update my materials? If I haven’t updated my own picture, what other archaic processes or forms am I using to draft their estate plans? Do I keep current on the latest veterans benefits and Medicaid laws?  

We teach our estate planning clients that they should review and update their documents and plan every three to five years to keep them fresh. Life events warrant changes. Why would we be any different from our clients?

This realization upset me greatly, because I absolutely love the professional picture I have on my website, brochures, and video streaming in my office lobby. However, I must admit that I have begun hearing prospective clients say that I “look much better in person.” From what I gather, they like my longer hair. It softens my hard lines (and hides my big ears). When I look in the mirror, all I see is an aging advocate. I no longer get the comments “you look much younger than I expected.”

Although my eyes do not look as “fresh” as I’d like them to, I am looking through a different lens with a fresh perspective of the image we are giving to our clients. It is my renewed goal to update our presence, starting with getting all new professional pictures. What can you do to spruce up your image or bring your current self into congruency?

If you want the latest tips and techninques on estate planning and elder law, subscribe to our blog.  And did you know we are also on Facebook, Twitter, LinkedIn, Google+, Instagram and Pinterest - connect with us for the most recent insights and information there is to know in the estate and elder law arena!

Victoria L. Collier, Co-Founder, Lawyers with Purpose, LLC, Certified Elder Law Attorney through the National Elder Law Foundation; Fellow of the National Academy of Elder Law Attorneys; Founder and Managing Attorney of The Elder & Disability Law Firm of Victoria L. Collier, PC, www.ElderLawGeorgia.com; Co-Founder of Veterans Advocates Group of America; Entrepreneur; Author; and nationally renowned Presenter.

Will You Be In The Conference Room or The Courtroom Resolving The Estate?

Many clients understand the benefits of trusts because of the past 25 years of the marketing of revocable living trusts. Clients, however, don't always understand what makes trusts work. Still today, many lawyers draft simple trusts that are little more than a "fill in the blank" form in an attempt to "avoid probate." Even if attorneys are able to deliver higher-quality trusts, many still fail to fund them. This leads to the greatest challenge of all. After death, will the client's family be in a courtroom trying to resolve the estate or will it happen in your conference room? The worst part is, most attorneys don’t think they have a "fill in the blank" trust, because they have a document creation system from XYZ Estate Planning organization. Surely they know what they are doing!

The key to the answer will depend upon the terms of the trust created, and the integration of the financial assets into the plan to ensure probate is avoided and the full benefits of the trust are accomplished. Unfortunately, most advanced trust systems are nothing more than a higher-level "fill in the blank" trust and usually create around the attorney’s needs, not the client's. That inevitably leads to other challenges.

The next question in trust planning centers around the after-death provisions in a living trust. A lot of control and latitude can be provided to the family members of a decedent if the trust was properly drafted and funded. The specific powers you grant to the after-death trustees, in addition to the specific manner in which the assets can be distributed, can also have a significant impact. For example, a majority of practitioners still continue to deliver the trust assets to the beneficiaries outright after the death of the grantor. While this is simple, it requires a whole other estate planning endeavor for the beneficiary that didn’t have to happen. While that puts more money in the beneficiaries’ pocket, I am not sure it is the best way to meet the client’s overall goal.

Another strategy to consider while drafting revocable living trusts is to transfer the assets to a separate share asset protection trust for each of the beneficiaries. This assures that the client's ultimate goals of protecting their assets for their loved ones – and perhaps from their loved ones – can be achieved. Obviously this can’t be achieved in the "fill in the blank" trusts many lawyers use, and not easily in the lawyer-centered document systems.

Don't go it alone. Let Lawyers with Purpose help you sort this out in a systemized and organized fashion that includes the legal technical training, comprehensive customization of trusts and particular drafting available to accomplish the myriad needs of the clients’ overall planning strategy – and helps them sleep at night. Don't go it alone. Join us for the legal technical, practice management, and marketing strategies to be a comprehensive solution to your client.

If you're at all interested in joining Lawyers With Purpose and making 2016 your best year yet - we'd like to invite you to a webinar THIS FRIDAY, January 22nd at 2 EST.  Register now for "How You Can Have the Business, the Income and the Life that You Once Dreamed About When You First Started Your Practice" and see how we can help you make it happen once and for all!

David J. Zumpano, Esq, CPA, Co-founder Lawyers With Purpose, Founder and Senior Partner of Estate Planning Law Center

Top Paralegal Resolutions For 2016

Some of you have probably already made - and broken - your New Year’s resolutions for 2016, to include common personal ones like losing weight, doing more exercise, eating better, and quitting bad habits. However, consider making and sticking with some work-related resolutions as well as personal ones to keep you on track professionally. The following list from the paralegal perspective, but it can be applied to any position in your law firm.

FOCUS – January is the time to revisit time templates or to resolve to go back to good habits allowed to lapse, like using planning organizers. Lawyers with Purpose provides you with time management tools as well as a range of focusers, including those for daily, weekly, and monthly planning. Make sure your time template has time devoted to planning each and every week. Time spent planning will be repaid in increased efficiency and goal attainment. Every year I make myself a New Year’s gift of a great calendar as a reward for planning ahead. This calendar can be paper or digital, whatever your preference.

EDUCATE – Plan and prepare for further career development by identifying where the gaps in your knowledge and experience are, and deciding how to go about filling those. Or perhaps you want to hone part of your existing skill set. The mind, like many other tools, needs to be kept sharp to work at its best. Lawyers with Purpose offers you various ways of keeping informed and educated, including ListServs for BOTH the attorneys and their team members, blogs, and webinars on the event calendar.  There are also the Tri-Annual Practice Enhancement Retreats (TAPER), which offer legal-technical focus sessions in addition to firm planning and personal development.

CHECK IN with your goals and/or set new ones. It’s been roughly three months since TAPER in Phoenix, so it’s the midpoint of the period during which many of you resolved to implement some projects. Have your efforts lost steam? This is a great time to reassess derailed projects and set tasks to get them back on track. If you did not attend the last TAPER event, now is a great time to set new goals. There are tools on the LWP website that you can use in your "Brainstorming Sprints", as well as project focusers like the "Money Plan" and "The Implementation Focuser". 

RENEW your commitment to the system. Have you been so busy doing the work that you haven’t had time to do the necessary data input crucial for tracking? Regardless of what file management system you may use or whether you are still using paper files or have gone completely digital, attorneys must allow time for their team members to perform all the file maintenance required. If you don’t schedule regular maintenance – just like a car – the engine starts to run rough and may stall. Remember, it may just take 10 minutes to make a phone call, but it can take 5 minutes more to document the phone call, potentially mark a task complete and then schedule a follow-up task. In a typical work day for the law firm, I spend easily an hour of my time on file maintenance alone – adding file notes, scanning and uploading documents, marking tasks done, scheduling follow-up tasks, updating status of file in workflow, linking emails. It is this maintenance that permits you to track the work being done in your firm and hold team members accountable. Pull up your reports and identify where clean up must occur and schedule time on your template to chip away at any overdue file maintenance.

Finally APPLY the 4 D’s of time management – delete, delay, delegate, and do – to any and all of your lists and/or piles in your office. There are variations of these terms, so feel free to adopt the version that makes the most sense to you and your job responsibilities. With this strategy, you review incomplete tasks and decide whether you are going to delete, delay, delegate, or do the task. If a task is no longer important or relevant, or perhaps is already done, can it be deleted? Or you may have a task that you would like to do one day, but it can be deferred or delayed to a later time. Don’t lose sight of this task by adding it to a focuser reserved for remote future planning. Meanwhile, delegate those tasks that can be done by someone else, preferably someone who can perform the task better than you could. Finally, whatever is left over, you do. These might be tasks that can be done in 10 minutes or less and just need to be completed, or they may be tasks of higher priority that need to be scheduled immediately.

These five recommendations are my professional resolutions for 2016. By focusing on planning, scheduling time for education and training, checking in with previously set goals, renewing the commitment to your file management system, and applying the 4 D’s of time management to any pending matters, you can reboot your system, so to speak. I invite you to join me in resolving to start the new year with a fresh beginning – professionally and personally. Happy New Year!

If you want to learn more about becoming a Lawyers With Purpose member and what we have to offer your estate or elder law practice, join us this Friday, January 22nd for a FREE webinar "How You Can Have the Business, the Income and the Life that You Once Dreamed About When You First Started Your Practice. Click here to grab your spot today.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers with Purpose.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.

What David Bowie Taught Us About Personal Care Plans

I was in 5^th grade when I got my first ghetto blaster. It was pink and came from Santa wrapped up with a David Bowie cassette tape. I played “Dancing in the Street” on that ghetto blaster, danced around my room and stared at my David Bowie poster what seemed like a million times. He was an icon. His music masterfully took over MTV during the time period when MTV played music videos. He was able to paint the exact picture he desired his audiences to see. A talent he held even in death. David Bowie fought cancer for 18 months privately and died in his home, peacefully, surrounded by family. With the help of his wife, Iman, and children David died exactly as he lived … on his own terms.

As soon as I read of the way that he passed, I instantly knew that David had a personal care plan. He decided exactly who he wanted around him at death. It has been reported that when he got too sick to go to his favorite pub for his favorite sandwiches, assistants would go pick them up for him. When facing a chronic disease, there is so little we can control, but isn’t it nice to know that we can plan to be as comfortable as possible, surrounded by the things and people we love and sheltered from those we do not want around.  

Personal care plans are an amazing, yet largely overlooked, estate planning tool. While having our finances in order is critical, knowing we will pass with the comforts and dignity we deserve can offer more assurance than any other portion of a well-made plan. Early in my career, I largely disregarded the personal care plan as an ancillary document not necessary. But, as I watched client after client pass in various ways under various circumstances, I saw over and over not only the comfort it brought to the ill party, but the guidance and assurance it brought to family members that they were honoring their loved one as he would have wanted.  

A well written personal care plan allows a client the ability to guide who visits during end stages of life. It guides the determination of when and in what condition the person wishes to be taken out in public. It allows a person to select what food, drinks, television shows, books and entertainment he wants available when he can no longer articulate such things. It lists religious preferences and whether or not one wishes to attend church services.

Personal care plans also offer the ability to appoint one’s own disability panel. This disability panel is a group of individuals in someone’s life who will decide when a person is incompetent for purposes of any trust in which his estate is held. What a power! Now this person has kept his life from going on display as a Judge who knows little about him determines his competence. Instead the decision is made by a hand selected group of loved, trusted people in a private manner.

On his 50^th birthday, David Bowie stood in Madison Square Garden and said, “I don’t know where I’m going from here, but I promise it won’t be boring.” And, it wasn’t. He left us on top of the charts and under his own terms. As LWP attorneys, how great is it that we make sure our clients pass with the same dignity?  And we have everything we need to do it right at our fingertips within the drafting software...

If you aren't a Lawyers With Purpose member consider joining our FREE webinar "How You Can Have the Business, the Income and the Life that You Once Dreamed About When You First Started Your Practice" on Friday, January 22nd at 2:00 EST.  In just one hour we'll share with you lots of effective techniques - and you don’t want to miss any of them:

• Streamline your practice, increase revenue, avoid malpractice - all while working fewer hours and enjoying more time to spend with your family and serving your community.
• Create targeted marketing and sales efforts so your practice grows reliably, predictably, and CONSISTENTLY!
• Build lasting relationships with referral sources and strategic partners - ensuring your clients stay loyal AND work on your behalf referring their friends over and over again!

All Designed With YOUR Practice And YOUR Success In Mind

Kimberly Brannon, Legal-Technical & Software, Lawyers With Purpose

Revoking An Irrevocable Trust

Did you ever wonder if you can revoke an irrevocable trust? The bigger question is, why would you want to? Didn't the grantor set it up to ensure it's not revoked? All good questions, but you never know.

Many clients' biggest concern with creating irrevocable trusts is, “what if something happens” they never expected. As estate planning attorneys, we are able to calm client fears by expressing that an IPug® trust can permit them, as grantor, to retain rights to the income and continue for their life to continue all their assets and retain the complete authority to distribute the principal to anyone they choose at any time, other than themselves or their spouses (if Medicaid eligibility is a goal). Inevitably, there's always one client who worries they might need it.

A typical response is, they can distribute it to their kids and the kids can give it back. While this is true, it is not a foolproof planning strategy, as we cannot be assured that the children will actually give it to them in the manner the grantor so desired. More commonly, the need to revoke an irrevocable trust occurs if the client falls ill and needs long-term care prior to the five-year look-back period running. To “cure” the transfer to the irrevocable trust, one seeks to revoke the irrevocable trust in whole or in part, to ensure funds are given back to the grantor to pay through any penalty period caused by the transfer of assets that remain in the IPug. The question becomes, can you revoke an irrevocable trust?

The answer is, it depends on your state law. In most states, an irrevocable trust can be modified or revoked (completely or partially) if all of the parties consent. In an IPug trust, however, you do not need all of the parties to consent to modify the trust, as the grantor retains a non-generated power of appointment that allows the grantor the full rights to modify the trust beneficiaries in any way, shape or form, including the ability to modify the timing, manner and method of distribution to the beneficiaries. But one unbending restriction is that the grantor can never change the trust to give himself or herself access to the principal.

So who are considered the parties to the trust? Generally, the parties consist of the grantor, the trustee, and all of the beneficiaries. When drafting an irrevocable IPug trust, the grantor and trustee is traditionally the client. Therefore two out of the three can be accomplished with just the grantor. Further, getting consent of all of the beneficiaries traditionally includes the grantor, as they may be an income beneficiary during their life. The distinction then becomes, who else are the beneficiaries?

When considering those who are responsible to consent to a modification or revocation, one must look to the trust terms to determine if an individual is a present beneficiary, a residuary beneficiary, or a contingent beneficiary. Generally, most states require the consent of the present and residuary beneficiaries. Consent will not be required from any beneficiaries whose interest is not affected by the amendment or revocation. Some states, however, require even the consent of the contingent beneficiaries. Contingent beneficiaries are those who would receive the benefit from the trust if the present interest or residuary beneficiaries were not able to. Typically, this would be the children beneficiaries where a "per stirpes" distribution is provided for.

This can become very problematic if you need contingent beneficiaries’ consent, because most would be a minor and unable to consent. Then you would need to look to state law to see if a parent can consent on behalf of a child. In most states, since it's a property interest, parents do not automatically have the legal right to affect the property interests of their children, just guardianship over their “person.” The strategy with an IPug is to utilize the retained power of appointment to remove all beneficiaries except one, and then get that one named beneficiary to consent to the modification. After the modification is accomplished, the grantor can again modify the trust and rename all of the original beneficiaries if desired. Where it can get complicated is if any of the parties are deceased. Generally speaking, if a party is deceased, then the contingent beneficiaries would be required.

The bigger challenge is if the grantor is deceased. While a strong argument can be made that consent of the beneficiaries who ultimately benefit from the trust should be enough, it is very difficult to overcome a challenge that an irrevocable trust in the absence of the grantor who created it was meant to remain unchanged. It is presumed in the creation of the trust that the intentions of the grantor will be maintained in their absence. If you want to ensure that it can be modified after a grantor’s death or incompetence, your irrevocable trust should authorize a modification with the consent of the beneficiaries in the absence of the grantor by virtue of incompetency or death. You must, however, in all circumstances ensure that no modification can be made to permit the grantor to have access to the principle. Doing so would invalidate all of the protections originally sought by the irrevocable trust.

In a handful of states, consent of the parties is not sufficient to modify an irrevocable trust and consent from the court is required. This is a much more difficult approach, if for no other reason than the time it takes to get the court's consent, and the possible consequences or loss of assets caused by the delay. The cost by utilizing courts can be counter to the client's “protection” goal. That's obviously on a state by state and court by court basis. So if you're doing this planning, know your state's rules. The good news is that it is rare, if ever, that you need to revoke an IPug trust, and if you need to, it is quite simple to do by minimizing the beneficiaries through your power of appointment.

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Getting the Physician Form Right for Aid and Attendance

Purpose of the 21-2680:

The VA form 21-2680 “Examination for Housebound Status or Permanent Need for Regular Aid and Attendance” is used to document the level of care required by a claimant or a claimant’s dependent. The VA form 21-2680 is completed by a physician based on his/her medical evaluation of the patient. The importance of documenting the level of care is two-fold:

1. To support a claim for additional pension above and beyond the base level AND
2. To support the need for certain medical expenses.

There are three levels of non-service-connected pension that a claimant may qualify for: base pension, housebound, and aid and attendance. The base pension is the lowest pension that a claimant may be awarded. Additional funds are granted if you can document that the claimant is housebound, and even more funds go to those requiring another individual to assist with at least two activities of daily living (ADLs). The VA also looks at level of care when considering medical expenses to offset income. Therefore, the VA form 21-2680 should document the level of care that justifies the medical expenses being declared. This applies to the claimant’s dependents as much as the claimant. So for example, the VA will not consider the assisted living facility expense for a veteran’s spouse unless a form 21-2680 is also completed for the spouse indicating the need for the facility to assist with at least two ADLs.

Completing the 21-2680:

The VA form 21-2680 is relatively short (two pages) and is to be completed by a third party – that is, a physician. All you need to complete the form is the veteran’s and claimant’s – if other than the veteran – name(s), Social Security number(s), and address. When you are completing the form for a living veteran’s spouse or other dependent, it is that person's name that appears in the field that requests the name of the claimant, even though, strictly speaking, the claimant is the living veteran. When downloaded from the VA website at http://www.va.gov/vaforms/, the 21-2680 has no separate instruction pages. It does state its purpose near the top of the first page: “The purpose of this examination is to record manifestations and findings pertinent to the question of whether the claimant is housebound (confined to the home or immediate premises) or in need of the regular aid and attendance of another person.”

Despite the fact that you are not completing this form yourself, you should still review all 21-2680s once completed by the physician and before submitting to the VA so that you can confirm that every field is answered and that further explanation is provided when required by the instructions. Form 21-2680 should be signed by a physician because the signatures of nurse practitioners or physician’s assistants are not acceptable. Errors and omissions of this type should be corrected before filing the claim or you may risk a delay. Most importantly, you should also confirm whether the form 21-2680 does in fact document the claimant’s housebound status or the need for aid and attendance.

Housebound status is documented by the physician’s answer to field 33, “Describe how often per day or week and under what circumstances the claimant is able to leave the home or immediate premises.” A clear indication of housebound status would include a statement from the physician such as, “Patient no longer drives and relies solely on caregivers to attend necessary doctor appointments.” The VA form 21-2680 will support the need for aid and attendance, if it provides clear evidence that the claimant needs assistance with at least two ADLs. Acceptable ADLs are bathing/showering, dressing, eating, getting in/out of bed or chair, and using the toilet. The following are not considered ADLs by the VA: walking, medication administration, meal preparation, and protective environment only. This is very important in the case of independent living facilities, the expense of which will not be considered by the VA unless the 21-2680 documents that such a facility provides a protective environment and custodial care that is supplemented by a third party providing the assistance with two or more ADLs. Otherwise the cost of the independent living facility may be considered merely rent and thus not a deductible medical expense. A clear indication of the need for aid and attendance would be input into box #25, where it asks if the claimant needs a nursing home. The answer to that question may be “no.” However, the physician should write out to the side something like, “Patient needs to live at ABC facility for a protected environment, custodial care and assistance with ADLs.”

Because of the importance of using the right language on the VA form 21-2680, the software developed by Lawyers with Purpose to complete VA claim forms produces a sample VA form 21-2680 with recommended verbiage and other guidance for the most important fields. This sample can be provided along with a blank form to the doctor for guidance with instructions that can be used if the doctor feels it applies. If the doctor does not believe that it applies, it may be that your client simply does not qualify for as high a level of care. You may still be able to file for base pension or plan to follow up with the client periodically to check if medical needs have increased.

What to file with the 21-2680

Other than the regular VA application forms, nothing else is required to be filed with this form. However, if you feel that your completed VA form 21-2680 is weak in areas, but you believe that your client’s medical condition warrants aid and attendance, you can add supporting medical records. This form should be submitted as part of a fully developed claim in order to expedite the processing. As a reminder, you may not need to file a VA form 21-2680 if your claimant is only seeking base pension. And a 21-2680 does not need to be filed if you are filing the VA form 21-0779 because the latter documents that the claimant is in a nursing home and requires skilled nursing care, and thus by definition has a permanent need for regular aid and attendance. This will however not stop some VA adjudicators from requesting the 21-2680 form nonetheless, so we generally request all of our VA clients to get one completed as soon as they have retained us – particularly because it can take some time to get the completed form back from the doctor.

Always remember that this form can be used for both supporting a claim for higher levels of pension and the need for certain medical expenses. Keep those two purposes in mind when you are deciding whether or not the VA form 21-2680 needs to be included as part of your VA claim, and when reviewing their completion by a third party to make sure there are not unexpected results with your claim.

If you want to see first hand how the LWP-CCS Drafting Software works with VA form 21-2680 - along with the thousands of other things it has to offer you're estate and elder law practice - click here to schedule a live software demo.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.