Estate Planning Considerations and COVID-19
As the novel Coronavirus (COVID-19) continues to affect almost all areas of life, health, safety and well being, our clients and their families are of paramount importance to us. In light of the current situation, we recommend that our clients take the time to meet with an estate planning attorney or have their current estate plan reviewed by their lawyer to make sure it is up to date. Here are some things to take into consideration during these unprecedented times.
1. Health Care Advance Directives and Powers of Attorney: It is advisable to make sure everyone has Health Care Advance Directives and a Power of Attorney in place. Health Care Advance Directives appoint a trusted person to make medical decisions on your behalf should that become necessary. Powers of Attorney allows you to appoint someone to act on your behalf with respect to legal and financial matters in case you cannot. In these uncertain times, it is important to make sure these documents reflect your current wishes and that these documents are readily accessible in case of an emergency.
2. Liquidity Issues: Most courts are now effectively closed to all but select emergency matters. This means there are likely to be significant delays in proceedings to probate wills in the coming months. In preparation for this, individuals (especially those with a high risk of serious medical issues or those on the front lines) should make sure that their families will have sufficient liquidity to provide for living expenses and estate taxes in the event probate is delayed. Better yet, clients can simultaneously help address liquidity concerns and avoid the expensive and lengthy probate process by transferring assets to a revocable trust.
3. Document Review: While it is generally recommended clients periodically review their estate planning in response to changes in their family and financial situations (as well as changes in the tax law), the impact of the current crisis is significant enough to warrant further review. In addition to wills and trusts, everyone should review the beneficiary designations for their life insurance policies and retirement accounts.
4. Guardianship of Children: While it is painful to imagine, it is important to designate who you would like to become the guardian of your minor children. In such tragic cases, this helps to avoid family disputes. Failure to do so can have devastating consequences with the children ending up as wards of the state.