There is an answer to this problem. We recommend that young adults execute general durable powers of attorney, advanced medical directives and HIPAA releases, so that their parents have the power to act as surrogate decision makers while their children are off at college.
The power of attorney would allow a parent, acting as an agent, to assist his/her child with bill-paying to make sure that tuition is paid or that scholarship forms are appropriately filled out. It would allow the parent, as agent, to access the child’s bank and credit card accounts to help him/ her better manage money. Being an adult does not automatically confer wisdom about handling money and maintaining a budget. Being an involved parent, on the other hand, does allow you to guide and instruct your child and, if necessary, to jump in before a little problem becomes a huge problem. If you do not have access to your child’s accounts and financial information, you may not be able to assist your child when they hit that first, inevitable, bump in the financial road. Imagine your frustration at calling the bursar’s office to check on their receipt of an important check only to be told that they cannot tell you anything and you have to round-up your child to get the information or worse, get the child to appear at the bursar’s office to ask the question himself. Even the most responsible ones will be hard to find as they experience the freedom of college living.
An advance medical directive and accompanying HIPAA release is an important part of the equation as well. While many think of an advance directive as being limited to end-of-life decisions, this is only one part of a well-drafted advance directive. In the case of young adults, it serves a vital function of appointing an agent to make health care decisions for them if they cannot do so themselves. The HIPAA release authorizes a doctor to communicate with a parent about the child’s medical condition so that, even if the child is not wholly unable to make a decision, it allows a faraway parent the ability to participate with the doctor and the child in making important decisions. If the child cannot make his/her own decisions, either because the child has been seriously injured in an accident or has psychiatric or dependency issues, most parents and children would want the parents to be informed of the situation and to be involved in the decision-making process. Nothing could be scarier than calling a hospital only to be told that privacy laws prevent the doctor from speaking to you about your child.
By executing these documents on attaining the age of eighteen, young adults and their parents can feel secure in the knowledge that the safety net on which they have all relied since birth will remain in place until such time as the children are really ready to be totally on their own. The vast majority of children will likely leave these documents in place until they are ready to do some estate planning on their own. And that is not a bad thing. Come see the attorneys at the Hook Law Center – we can help you with all life’s transitions from the birth of a new baby to the baby leaving the nest, from marriage to divorce, from planning for retirement and long-term care to the death of a loved one. We’ve got you covered.
Ask Kit Kat – Westminster Dog Show
Hook Law Center: Kit Kat, what was new at the Westminster Dog Kennel Club Show that was held on February 13-14, 2017?
Kit Kat: Well, a couple of things were new this year. In my opinion, the biggest news was that cats were included for the first time this year. The cats weren’t actually in the show, but they were part of a ‘Meet the Breeds’ event which took place on February 11, 2017 before the actual dog show. At this event, dogs and cats were featured in booths in which the owner could have them displayed with information about the animal—where they originated from, etc. Booths could be decorated any way the owner chose. It made for an interesting event with both cats and dogs dressed up in all their finery!
Also, new to the Westminster Dog Show were 3 new breeds. This helped expand the number of participants to nearly 3,000 dogs. Wow! Can you imagine that many dogs in one place? Anyway, the 3 new breeds were: the American Hairless Rerrier, the Pumi, and the Sloughi. Can’t tell you much about 2 of the breeds, but the Pumi looks to me like a miniature poodle with a squarer face. Actually, Wikipedia defines it as a herding terrier from Hungary of small/medium size. It definitely is a good-looking dog, who I am sure will increase in popularity due to its compactness and personality.
So, kudos to the Westminster Dog Kennel Club! They are showing an inclusiveness which animal lovers can’t help but enjoy! (http://www.usatoday.com/story/news/nation-now/2017/02/01/ westminster-dog-show-going-cats/97329506/)
Distribution of This Newsletter
Hook Law Center encourages you to share this newsletter with anyone who is interested in issues pertaining to the elderly, the disabled and their advocates. The information in this newsletter may be copied and distributed, without charge and without permission, but with appropriate citation to Hook Law Center, P.C. If you are interested in a free subscription to the Hook Law Center News, then please telephone us at 757-399-7506, e-mail us at mail@hooklawcenter.com or fax us at 757-397-1267.The post Issues to Consider when Your Child Goes off to College first appeared on SEONewsWire.net.]]>
Problems with the Proposed Regulations
The proposed regulations were meant to curb the heavily scrutinized practice of funding assets into an entity and claiming a valuation discount for the interest held in that entity by members of the same family. Allowing aggressive discounting of passive entities creates an opportunity for wealthy individuals to pass on relatively liquid assets (e.g. stock portfolios) at steeply discounted values to avoid estate and gift tax. Obviously, such treatment should be limited to prevent loss of tax revenue where the structure of the entity has no legitimate purpose other than tax avoidance. This goal is accomplished but not reasonably tailored to prevent harsh treatment against legitimate businesses. Treasury drafted the proposed regulations extremely broadly covering both operating and passive businesses. Furthermore, the proposed 2704 Regulations cover more diverse ownership groups than what most would consider a “family business”. However, the current proposed regulations do not except legitimate businesses that have true economic purpose other than tax avoidance. Additionally, the proposed regulations redefine the concept of “Fair Market Value” that has been a fundamental concept of tax law for decades. Because of the broad nature of the regulations, they are akin to amputating a foot because of a wart on a toe. These issues caused significant pushback from commentators and will warrant revision, or wholesale abandonment, of the proposed regulations.
The current transition of presidential administrations places this battle in an interesting political context. Like all other departments, the Treasury will cede control to a new administration next year. Let’s explore the possible fate of the proposed regulations.
The treasury can move forward and implement a final rule with little or no modification. At that point, the rule can be challenged by litigation, overturned by Congress, or revised by later action of the treasury department. Actions against the rule can be pursued pre-emptively in Congress, and there are currently efforts underway to “vote down” the regulations legislatively. If the regulation is passed, both houses of Congress can pass a resolution of disapproval which, upon signature by the president, voids the rule. This congressional process is rarely used and would be unnecessary if a pre-emptive measure were successful. The new president would have the final say on a congressional vote to void the regulations due to the timeframe given for congressional review. A litigation challenge would be undertaken after the rule, which would subject the rule to judicial scrutiny, but could only be brought after the rule becomes final. Finally, the Treasury (under the new administration) has the ability to implement regulations of its own, which would likely walk back any rule that is implemented.
Impact on Family Businesses
Given the above opportunities for challenge, the proposed rule is likely short-lived in its current form. At a minimum, the drafting concerns voiced at the hearing need to be addressed. This presents a planning opportunity. In the near term, the hearing gave some clarification on the currently proposed regulations. In the long term, it looks like there may be a more favorable environment for transitioning ownership in family businesses. Discussing how the proposed rules and the potential changes of the next administration are critical to determining intermediate and long-range succession plans for family businesses. Contact our office to make an appointment with one of our estate planning attorneys to discuss how the current environment impacts your business.
Ask Kit Kat – Pet Sitters
Hook Law Center: Kit Kat, what can you tell us about dogs and how they respond to speech and tone of voice?
Kit Kat: Well, it looks like dogs are amazingly perceptive when it comes to interpreting speech and tone of voice. Researchers at Eotvos Lorand University in Budapest, Hungary have done some pioneering work on this subject. Like people, dogs use the left hemisphere of their brain to interpret meaning, They use the right hemisphere to interpret sound and its emotional content. The study was led by Dr. Attila Andics, and the techniques used were by themselves quite pioneering. The dogs in the study had to be trained to lie perfectly still while a picture of their brain was taken by a MRI machine. This is very remarkable, because other primates like apes cannot be similarly trained. The MRI requires complete stillness, and they cannot manage that.
This is what the researchers discovered. Dogs reacted most strongly when words of praise like ‘good boy’ or ‘well done’ were used. These positive words elicited a lot of activity in their brain’s reward center. When the researchers used less defined language like conjunctions and some adverbs (‘however’ or ‘nevertheless,’ for example), the dogs’ reward center in their brains registered much less brain activity. With the words of praise, it was almost like they were given a delicious treat to eat; it was that reinforcing. So what does this mean? It means humans are not the only creatures who have the ability to understand and react to language. What’s more, other scientists like Dr. Brian Hare of Duke University believe the canine’s ability to do this developed long before humans started to use language. Did this ability aide dogs in the domestication process, as dogs moved from the wild to living with humans? More research will be needed to answer that question.
I suspect many dog owners intuitively have known how smart their dogs are. Now we have confirmation. They really are man’s best friend. (James Gorman, “With Dogs, It’s what You Say—and How You Say It,” The New York Times, Science section, August 29, 2016) (http://nyti.ms/2c40znU)
Distribution of This Newsletter
Hook Law Center encourages you to share this newsletter with anyone who is interested in issues pertaining to the elderly, the disabled and their advocates. The information in this newsletter may be copied and distributed, without charge and without permission, but with appropriate citation to Hook Law Center, P.C. If you are interested in a free subscription to the Hook Law Center News, then please telephone us at 757-399-7506, e-mail us at mail@hooklawcenter.com or fax us at 757-397-1267.The post Problematic Proposed Regulations May Harm Family Businesses If Left Unaddressed first appeared on SEONewsWire.net.]]>