Planning for the inevitable occurrence of your death may be the primary focus of your estate plan; although, it should not be the only focus. In fact, a well-drafted and comprehensive estate plan should help you to accomplish several related goals. One of those goals should be to plan for the possibility of becoming incapacitated. To help you better understand the need for incapacity planning, the Owings Mills incapacity planning attorneys at Gershberg & Associates, LLC have created several frequently asked questions and answers relating to incapacity planning that you may find helpful as you contemplate your own estate plan. If you have specific questions relating to incapacity planning, feel free to contact our office to schedule a consultation.
I’m still young, do I need to worry about incapacity planning?
Seniors are not the only ones at risk of becoming incapacitated. Though you may not wish to think about it, the truth is that a car accident, a debilitating illness, or even a work-related injury could all result in your incapacity at any point in time. In fact, experts tell us that a typical 35-year-old has a about a one in four chance of becoming disabled for 3 months or longer during his/her working career. Because incapacity can happen to anyone, at any age, it only makes sense to plan for that possibility by including an incapacity planning component in your estate plan.
If I become incapacitated without a plan in place, what happens to my assets?
Whether you are wealthy or have only a modest estate, you undoubtedly care what happens to the assets you own and you are accustomed to controlling what happens to those assets. If you failed to plan accordingly, you have no way of knowing who will end up in control of your assets if you become incapacitated. Several different people might want to oversee your assets which will force a court to decide who will be in control.
Who will make healthcare decisions for me if I become incapacitated without a plan?
In the absence of an incapacity plan that makes it clear who you designate to make healthcare decisions during a period of incapacity, a court may need to appoint someone. At that point, you have no control over who is appointed to make decisions for you, nor any say so over the decisions that are made on your behalf. In addition, if more than one person believes that they have the right to make those decisions for you, a costly and divisive court battle could ensue that leaves your loved ones taking sides.
What is incapacity planning and how can it help me?
Incapacity planning utilizes legal strategies and tools that collectively determine who will control your assets and make important decisions for you in the event you are ever incapacitated. It allows you to make crucial decisions now instead of a judge making them for you later.
Is a Power of Attorney a useful incapacity planning tool?
A Power of Attorney is a legal agreement that allows you (the “Principal”) to grant another person (your “Agent”) the legal authority to act in your place in legal matters. That authority can be general, allowing your Agent almost unfettered power to act on your behalf, or limited, only granting your Agent the authority to act on your behalf in specific situations or for a designated period. If you make any Power of Attorney durable it means that the authority granted to the Agent will survive the incapacity of the Principal. A Power of Attorney can be a helpful incapacity planning tool; however, there are also some disadvantages to depending on a POA. There is always the risk that third parties will not accept your Agent’s authority despite the law requiring them to do so. In addition, it is quite easy to grant too much or too little authority to your Agent when you create a POA.
How can a revocable living trust help with incapacity planning?
One of the most popular incapacity planning tools is a revocable living trust. When used to help plan for the possibility of incapacity, a revocable living trust works by allowing you to appoint yourself as the Trustee of the trust and appoint someone of your choosing as the successor Trustee. Your estate assets are then transferred into the trust. Because you are the Trustee, you continue to control those assets just as before; however, if you become incapacitated the successor Trustee (chosen by you) takes over as Trustee, thereby shifting control of your assets to the person of your choice without the need for court intervention. Moreover, when you recover you can resume your position as Trustee as if nothing happened. Finally, because the trust is revocable, you can move assets in and out of the trust with ease and even replace the successor Trustee if you wish to do so at any time.
How can an advance directive help me with incapacity planning?
An advance directive is a legal document that enables you to plan for and communicate your end-of-life wishes if you are unable to communicate those wishes at some point in the future. State law dictates what types of advanced directives are recognized in the state. Maryland recognizes two types of advanced directives, including:
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- New York Health Care Proxy. This lets you appoint a health care agent to make decisions about your health care. Two doctors are required to agree that you cannot make your own decisions for your Agent to take over.
- New York Living Will. This allows you to leave written instructions that explain your health care wishes, especially about end-of-life care. This document become effective when you are unable to make your own decisions, and your doctor confirms that you have an incurable condition.
Contact Us
For more information, contact the experienced Owings Mills probate attorneys at Gershberg & Associates, LLC by calling 410-654-3850 to schedule an appointment.
