Picking Agents For Your Powers of Attorney

In Illinois, many estate planners use the Statutory Short Form Powers of Attorney for Property and for Health Care. This is usually a wise choice, as the forms are easily recognizable by financial institutions (for the Property POAs) and health care providers (for the Health Care POAs).

A request that I frequently receive is to have multiple persons act as co-agents under a power of attorney. The form does not allow for co-agents, and with good reason.

One of the major reasons to have a power of attorney is to appoint an individual to be your decision maker if you are unable to make decisions for yourself. Appointing co-agents would complicate matters, particularly if the co-agents cannot agree. This may render your power of attorney form useless.

There is no problem with naming successor agent(s), but only one may serve at a time. Also, there is no problem having different agents under your Property POA and Health Care POA. If you are married, you do not have to list the same agents as your spouse.

Leaving Your Assets to Your Adult Children in Trust

When designing an estate plan for clients with adult children, it is common that I am asked to make the distribution to kids upon the death of the parent(s) outright and free of trust. This is true when the  parent(s) consider the children to be mature and fiscally responsible.

Unfortunately, a valuable planning opportunity is lost with this type of set-up. Why not consider leaving the funds to the adult children in trust and allow them to receive income and principal as needed? You may even make them co-trustee or sole trustee of their own trust!

You may ask "What's the point, then?" and the answer would be that leaving the assets to your children in trust, even one that they may control, provides valuable protection for the children in case of creditor problems or divorce.

Consider this type of planning and you will be providing a valuable benefit for your children.

Great Article Regarding End of Life Decisions

Take a few moments to read the following editorial from the New York Times regarding the importance of planning for illness: http://www.nytimes.com/2012/03/31/opinion/taking-responsibility-for-death.html

Estate Taxes in Illinois

The uncertainty surrounding the exemption amounts for Federal and Illinois estate taxes for 2012 and beyond has caused confusion for many clients. For 2012, the Federal estate tax exemption rises to $5.12 million (adjusted for inflation from the 2011 amount). After 2012, unless new laws are passed by Congress, the exemption amounts reverts to $1 million.
In Illinois , the exemption amount was increased to $3.5 million for 2012 and $4 million for 2013 and thereafter.
Therefore, in 2012, we have the same situation as in 2011, where an estate may be exempt from Federal estate tax, but subject to the Illinois estate tax.
Unless Congress extends the higher exemption amounts after 2012, 2013 could have estates subject to Federal estate tax and not subject to Illinois estate tax.
The bottom line is to have your plan reviewed to make sure that you are ready for any possibility.

Dissolving Your LLC Or Corporation

If you are looking to dissolve your Illinois LLC or Corporation, you may file Articles of Dissolution with the Secretary of State. This provides for a more orderly and official dissolution of the entity as opposed to not filing the annual report and waiting for an administrative dissolution. The forms are easy, inexpensive and provide for an address for service of process. The Business Corporation Act provides that "Dissolution of a corporation may be authorized by the unanimous consent in writing of the holders of all outstanding shares entitled to vote on dissolution. Dissolution pursuant to this Section does not require any vote or action of the directors of the corporation." 805 ILCS 5/12.10

Setting Up a New Business?

If you are setting up a new business, make sure you consider the type of structure that you will need. Your options include sole proprietorship, partnership, corporation and limited liability company. Each has unique tax consequences and requirements and all of them require careful consideration to make sure that you are starting on the right foot.

You will certainly save time and money by considering your options carefully before starting your business. You will also avoid running afoul of timely filing requirements. Call my office today.

Unintended Consequences of Self-Help Estate Planning

Many clients ask me: "Can't we just put one or more of our kids on our deed, so that they get the house when we die?"
What if one of your kids has trouble with creditors? What if they go bankrupt? You could lose your house in such a scenario. Placing your kids on the deed could jeopardize many things.

Another popular question: "Can't I just put one of my children on my accounts? When I die, they will know what to do as far as dividing it up among all of my kids."
If your kids got along with each other before your death, that might not last after you are gone.

Why leave things so important to chance? Consider a will or a trust and make everything certain. You may just save your family.