It is hard to believe that we are still dealing with the deadly Coronavirus and its devastating consequences, which do not seem to be abating anytime soon. In the midst of the illnesses and loss of loved ones, the worry, the stress, the changing rules, and overload of information, we have rediscovered ourselves, our kids, spouses, families, and friends, and vice versa. We are using the technology that formally isolated and divided us to now keep us connected. We’ve seen how resilient, creative, and caring we all are. These new realities can be viewed as a silver lining of this crises.
However, no matter how positive and upbeat we are, these are still uncertain and challenging times, and our thoughts become directed towards doing whatever we can to protect our families.
While to most of us this means physical protection, it is equally important to be legally protected, as well. The silver lining here is that people are now very motivated to make sure that their documents are in order. This is something everyone acknowledges is important to do, but somehow it always gets put off.
The sad reality is that COVID-19 has reminded us of how precious life is. It has also created new obstacles such as closed banks, courts, and government offices. It has made it difficult and sometimes impossible to have documents signed, notarized, or even located. No longer are we allowed to accompany or stay with our loved ones in hospitals, rehab centers , and assisted living facilities. It is challenging to even communicate with our loved ones or their doctors.
Critical Documents Every Family Needs
Now more than ever it is crucial to have a Will, a Power of Attorney, and a Health Care Directive/Living Will. And even if you have them, here is why they should be reviewed and updated to be relevant and effective in today’s “new normal.”
A Will makes sure the assets you have worked hard to build will be distributed according to your wishes. If you do not have a Will, your assets will be given out according to your state’s intestate laws (laws pertaining to someone who has died without a Will), which may not be what you would have wanted. A Will also names the person(s) you want to be in charge of your estate. If you do not have a Will, the Court will need pick an Executor if your heirs do not agree, and a bond, based on the total dollar value of all of your assets, will need to be posted. Issues regarding guardians, minors, disabled beneficiaries, second marriages, and tax planning cannot be dealt with if you do not have a Will.
Another important factor to keep in mind is that in order to satisfy halacha with regard to inheritance, one must have the proper documents, including secular ones. My office is experienced in working with clients and their rabbis in this area.
The negative effects of not having a Will are greatly magnified during COVID-19, among them higher costs and significant delays.
A Power of Attorney (PoA) will enable financial transactions if a person is unavailable or is incapacitated. Today it is quite possible for someone not to be able to sign documents due to a lock down, quarantine, travel ban, compromised health issues, etc. Without a valid and properly drafted PoA, sales, purchases, and applications for COVID-19 aid cannot be completed, and bank or investment accounts cannot be accessed.
A Health Care Directive/Living Will contains your instructions with regard to medical treatment and appoints your designated representative for medical decisions if you are unable to make them. These days patients are alone in hospitals, and if they are unable to direct their own care, they are not allowed to have family there to do so. It is imperative to have a customized document prepared, as the form provided by hospitals is generic and usually does not reflect basic Jewish practices or halacha. My office has Halachic Health Care Directive/Living Wills as well.
The Silver Lining: Beneficial Time for Creating Asset Protection and Tax Shelters
Another silver lining, which will be explored in Part II of this series, is that the negative economic consequences of COVID-19: a stalled economy, volatile stock market, record unemployment, and lowered asset valuations, coupled with low interest rates and the highest estate and gift tax exemptions in history, have combined to create a unique but short term window of opportunity for estate planning, asset protection, and tax shelters. Even clients with a modest estate can benefit.
If you do not have the basic documents or an estate plan, now is the time to prepare these. If you have an estate plan, now is the time for it to be reviewed, updated, and enhanced.
* This is not intended as legal advice, and should not be used or relied upon as such. It is provided for information only. Please consult your legal, financial, tax, or other professional advisor.
Lois D. Sutton is an attorney whose practice area includes residential and commercial real estate, estate planning, wills and trusts, including Halachic Wills and Halachic Health Care Directive/Living Wills, probate and estate administration, and business matters. Contact her at 732 245-4500 Lsutton@loissuttonlaw.com.