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Tips on Planning for Incapacity You Should Know

Estate planning is an important legal process that everyone will need to consider eventually in their lives, yet it is often seen as an uncomfortable topic. Planning ahead for incapacity, sometimes called competency and capacity designations, is one aspect of elder law that people especially want to avoid. To help make this crucial topic a little easier on you when it comes time for you to start planning ahead, keep these quick tips in mind.

  1. Powers of attorney: You can do plenty with a will when you are creating your estate plan, but you can often do more for incapacity planning if you use a power of attorney (POA). Giving someone direct control of important decisions in this way may be the best way to avoid delays or complications. As with any elder law or estate planning tool, always talk to an attorney before getting too far ahead.
  2. Enduring property control: In order to make your power of attorney even stronger, you will want to assign continuing or enduring property protections and control. States and even counties might have different regulations regarding this aspect of your POA so, once again, double-check your draft with an elder law attorney.
  3. Legal counsel: Actually, you might want to start thinking about assigning power to a professional elder law attorney instead of a family member. Many incapacity planning cases become undone by family members who try to vie for the responsibility. By working with a third-party, you can cut out any familial conflicts right away.
  4. Gifting funds and assets: Sometimes you can help your estate early by planning on gifting certain assets when you become incapacitated. This process could lower your estate into a lower tax bracket when you pass away. Take a moment to sit down with your lawyer and see what should be gifted, and then discuss the matter with your family to try to decide who should be gifted what and why. Or, if you are worried about in-fighting, as mentioned in the previous tip, this might be a process you have to go through with just your estate planning attorney.
  5. Amendments: At some point, it might be beneficial to change some of the terms set forth by your power of attorney. Who will you want to be able to make those changes while you are incapacitated? You can create an accompanying trust to go with your power of attorney that assigns someone the ability to authorize important power of attorney changes. If you are using a legal counsel to be the one named in your power of attorney, then you might want to give this ability to that person as well, since you know they will be familiar with the law already.
  6. Unintentional revocation: Read everything before you sign it. This is not just elder law and estate planning advice, but general legal advice that happens to apply to incapacity planning. When you make a power of attorney, it can be revoked easily if you sign something that revokes it. Sometimes banks and other groups that have some sway over your estate will draft their own power of attorney documents, which include a power of attorney revocation clause, and ask you to sign it. They are not necessarily trying to trick you into losing your POA and all it planned, so do not be too alarmed if this happens. Just do not sign anything until your lawyer reviews it with you.
  7. Mental and physical health: You could feasibly become incapacitated physically or mentally. You might want to make separate powers of attorney for healthcare and mental healthcare that trigger depending on what actually incapacitates you. You can also assign decisions regarding your physical healthcare, like hospitalization options, in one POA and decisions regarding your mental healthcare, like taking certain medications, in another POA.
  8. Sooner than later: Incapacity planning has to happen before you actually become incapacitated. Otherwise, the documents will be considered suspect by a reviewing court, which could think undue influence was used to get them signed. When you know you need to complete incapacity planning, get started and update or review once or twice a year.

Would you like help creating a competency and capacity designation? Have you run into other issues with elder law, estate planning, and similar legal concerns? Melnik Law Group, PLLC and our New York elder law attorney is here to help. You can call 800.517.5110 to request a free consultation to get you pointed in the right direction.

Rockefeller Center 7th Floor 1230 Ave. of the Americas New York, NY 10020
The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.

Melnik Law Group, PLLC - New York Elder Law Attorney
Located at One Rockefeller Plaza, 10th Floor New York, NY 10020 . View Map
Phone: (800) 517-5110