Planning Your Estate in the wake of the Tax Act of 2012

tax-breakAs Congress came to a consensus last night, and the American Taxpayer Relief Act of 2012 will be signed into law today, the time has come for us to determine how these laws will affect us individually. I would like to take this opportunity to offer you a few tips regarding the new law as you review your own estate plan.

The Estate Tax: While the taxable estate will remain at $5,120,000 with an annual inflation adjustment, experts in the area largely expect that a lower taxable estate is on the horizon. It has been predicted that the estate tax could drop down to a taxable estate as low as $1 million and could likely settle near $2 million. Further, the taxable amount increased from 35% to 40% of the estate.

The best estate plan should be to proceed with caution, and continue to include a spousal disclaimer trust allowing a surviving spouse to take advantage of the potential estate tax exemption in both estates any time we have a taxable estate over $2 million. Some may choose to purchase some life insurance policies, which pass outside of the probate estate, to have assets readily available to offset any potential estate tax liability.

It is also important when reviewing your Estate Plan that you have not only sheltered your children’s inheritance from a potential estate tax, but also from their own creditors and tax issues. Money left to adult children becomes attachable by their own creditors and judgements. A Trust for an adult child can allow the child to reap the benefit of the inheritance without the possibility of creditor attachments. It also allows you to select the next generation you wish to inherit the remaining assets at the beneficiary’s death.

Living Trusts: Many people set up living trusts instead of a Will to avoid probate and to prevent assets from becoming public. This only works effectively if all assets are owned in the name of the Trust, and not the name of the Donee or Lifetime Beneficiary. Because these trusts can become less effective as laws change over time, it is best to have these trusts reviewed periodically to see if they need to be updated under the new system.

Gift Tax: As many incorporate a lifetime gifting plan in their long term planning, it is worth noting that you should be able to continue on with that plan. The annual exclusion has been increased to $14,000.00 per year per donee.

Income Tax: Much of the Tax Act focused on income tax increases and, while those making over $400,000.00 a year will face the greatest tax increase, rule changes regarding personal exemptions will have the taxpayer making over $250,000.00 ($300,000.00 married) seeing income tax increases as well. If you are close to these income levels, I encourage you to meet with a financial planner early in 2013 regarding these increases.

Business Power of Attorney and Health Care Power of Attorney: When reviewing your estate plan, always make sure you have a current valid set of powers of attorney. These documents are fundamental in the continuation of your financial plan should disaster strike.

The entire Tax Bill may be seen on the Library of Congress website at If you have any questions regarding your own estate plan, please do not hesitate to contact me.

I hope you have a blessed New Year.

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Finding Hope and Help for those suffering with Alzheimer’s and Dementia in Our Community….


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What should a person look for in selecting a nursing home for a parent?


Choosing a nursing home for a loved one can be a trying experience.  Often, one is fortunate to have a few weeks to make a decision.  Sometimes, people are suddenly moved to a nursing home based only on who has an available bed, and not based on the preference of the family or any research that has been done.   In a case where the patient’s family is told at the last minute that the patient will be moved to nursing care in less than 24 hours, the family may want to consider appealing the hospital discharge.  At the very least, this will buy the family a few more days to investigate nursing facilities.

To start looking for a home, I encourage you to contact the Alabama Department of Senior Services at 1-800-AGELINE (1-800-243-5463).  They will put you in contact with your local Area Agency on Aging who can provide you with a list of nursing homes in your area.  Once you receive a list of homes, you should look for one that is close to your own house.  The closer a nursing home is to you, the more you will visit and the more you can monitor your parent’s care.

Go to visit the homes in your area.  You may or may not want to make an appointment with the administrator.  A “surprise” visit may give you a better idea of the day-to-day running of the nursing home.  Most administrators will be happy to oblige you in a visit and will freely answer any concerns that you have.  If they are not willing to assist you with a visit, this should be a red flag.

When you visit the home, be sure to take a look at the residents.  Do they appear to be well-groomed?  Residents that are clean and well-groomed and out in the open areas, like the dining room, the front porch or the community room are good signs.  Do you smell urine or other odors in the air?  While there may be odors in the air at times, a constant odor or the obvious cover up of constant odors can show a lack of care.

Does the home seem to protect the privacy of the residents?  Can you see a resident being groomed or receiving assistance with their personal hygiene needs in an open area, or with his or her door open?  If so, this does not show great respect for the privacy of the resident.

Check the public areas of the facility as well.  Are the restrooms clean or in disarray?  Go into the kitchen.  Does the kitchen appear sanitary or dirty?  Ask to have a meal with the residents.  See how the food seems to be prepared and if it is appetizing for the residents.  Is there a registered dietitian on staff who keeps up with the residents’ nutritional needs?

However, be aware that the look of the building itself does not take care of the residents.  It is the people inside that make the difference.  When you visit, the administrator or staff member that shows you around should be happy to help you.  When you walk through the halls, is the administrator with you speaking to the residents as if she or he knows and converses with them regularly?  Are the staff members you see personable towards both you and the residents?  Often times an older smaller home may be able to provide a more personalized service for your parent than a larger newer home.

Medicare provides a website where all deficiencies a nursing home has received are listed.  You can view this list by going to and clicking on “Compare the Nursing Homes In Your Area.”  Review the deficiencies, but do not let the deficiencies alone deter you from selecting a home.  A deficiency is a snap shot taken at the home at the time of the inspection, and may or may not be a good indication of the home overall.  Instead, take the list of deficiencies to the administrator and see what he or she did to rectify the deficiency and assure it would not happen again.

Once you feel like you have narrowed the homes down to one or two that you really like, contact your local Ombudsman.  You can get his or her name and number from The Alabama Department of Senior Services as well.  An ombudsman is a person who acts on behalf of nursing home residents in your area.  Ask his or her opinion of the nursing home and keep his or her name on record in case you have any questions or concerns in the future.

Finally, and most importantly, visit your parent on a regular basis once your parent is admitted to the nursing home.  Your regular visits will give you the best picture of how your family member is being treated and cared for, and it will let your parent know how much you care.

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The Departure Lounge


I am not a huge fan of flying.  It is not leaving the ground in a giant machine and flying with metal wings that bother me.  It is arriving far before my flight will leave, giving my luggage to a stranger and watching it be thrown on a belt, paying $5.00 for a diet soda and then being herded into a smelly tight fitting area with nothing to do but be stared at by strangers for two long hours.  I always grumble under my breath sitting in the uncomfortable chair while I wait and think of all else I could be doing with that time.  I guess you could say I have never been a big fan of the Departure Lounge….until now!

Why the change of heart?  As you may recall, last month I attended a United Methodist Women’s Retreat with my sister-in-law, and that is where I met Nel McChristie.  Ms. McChristie, at 85 years young, was another attendee at the retreat.  She had come all the way from Canada to Georgia to attend the retreat with her lovely daughter-in-law.  As we all went around the table and told about ourselves, I knew before she spoke that whatever Ms. McChristie said would be worth hearing!

Ms. McChristie told us how she gets up each day of the week and does yoga with her friends before sitting together and communing over muffins and coffee.  Ms. McChristie told us she does not worry of the sugar in the muffins, because she had just done all of that yoga!

Ms. McChristie told of the importance of gratitude.  She said that we must start each day with gratitude.  What matters the most in life is being grateful!  As long as we are grateful for what God has given us, we will have happy lives!

Then Ms. McChristie told us something I found shocking.  She said, “I know I am in the Departure Lounge and I love it!”  I knew she was not in any departure lounge I have been in; however, witnessing the happiness on her face and peace in her heart, I immediately wanted to go to this Departure Lunge one day too!  Can you imagine a place where you have the wisdom of years, the gratitude of an open heart, the blessing of friends and family AND CAKE?

I have thought of the Departure Lounge every day since that retreat.  I have conjured what it must be like there in that Lounge and what I can do to make the Departure Lounge a little more comfortable for those waiting.  What a world it would be if we all thought the way Ms. McChristie does.  We should all wake up every morning and celebrate all we are thankful for.

For those of us not quite in the Departure Lounge yet, instead of complaining (as I often to do in my uncomfortable little seat) we should contemplate what we can do to make the Departure Lounge a little more comfortable for the people waiting inside it, because by the grace of God we will get to sit in those seats one day too!

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Help Make Alabama a Dementia Capable State

I have exciting news!

Last week I had the privilege of going to the Alabama State House with a wonderful group of people from the Alzheimer’s Association to lobby our State Senators and Representatives on behalf of those who suffer from Alzheimer’s and dementia in Alabama.

Due to the efforts of the Alzheimer’s Association and others, our legislature will be dropping a bill on Tuesday to create the “Alabama Alzheimer’s State Plan Taskforce.” This taskforce will assess the preset and future needs of those in Alabama with dementia and address the best ways for our state to deal with the many issues that go along with these horrible diseases, including caregiver training, Medicaid funding and other economic and social impacts of dementia.

PLEASE HELP make sure this important initiative passes by emailing your local Senator and Representative and asking that they vote YES on the “Alabama Alzheimer’s State Plan Taskforce.” You can get your congressperson’s email address by following the link below and using the “Find Your Legislator” tab on the left.

When you are done, please feel free to forward this information to your Alabama family and friends!!

Thank you for your support of a fight for a cure!

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Gifts that Give Forever: Incorporating Memorandums into your Estate Plan


When we prepare our estate plans, we talk to financial advisors and attorneys about money, homes, cars, and insurance.  These things are very important, but they are not often the only important parts of our estates.  They are often not really the things we hold most dear.

I have, over the years, asked hundreds of people about their most precious items, and no one has ever named their life insurance policy.  Now, that policy is certainly important for the security of our children and spouse, but it is never mentioned as an answer to my question.  Likewise, when I ask families to name the most important treasure they have received from an estate, the answer is rarely money.   As a matter of fact, the answer usually costs very little.

People, particularly as we age, value memories of our loved ones.  Memories are often found in the most simple places and items.  I have had families tell me that they most valued a small metal frog where grandma used to hide mints, a tea set with chipped cups and no lid that they played with as children, and old pictures of the Eagle’s Nest from the War granddad took as an Army photographer (these were incredible to see).  In all of these estates, and countless others, there was plenty of money to be had.  But, at the end of the day, it is the personal items that elicit the most precious memories.

Unfortunately, when not properly gifted these small trinkets can also create the most tension in families.  When writing estate plans, I always encourage my clients to include memorandums at the end of their Wills so that they may specifically give these types of items to chosen family members, and help to avoid any unnecessary tension.

When preparing Wills, I love placing a clause in the Will allowing the testator to attach a written memorandum to the end of the document.  This allows the person to sit down at a later time and gift all kinds of special items to special people.  And, as time goes forward and items are gifted or lost, the memorandum can be torn up and re-written as the testator sees fit without additional attorneys fees.  These memorandums are a legal part of the Will when properly prepared and do not require the hiring of an attorney to re-write a document to gift a simple clock, gun, wedding ring or china pattern.

More importantly, these memorandums show our intent.  They show the importance of our relationship with the person we leave the items to, and the items gifted quickly become very treasured memories.  Memorandums also create a way to avoid what can be unfortunate tension and discourse among family members in what is the most stressful time of life, the mourning of a loved one.   I encourage everyone to include these memorandums in their estate plans.  And, as many of you know, if I wrote your Will, you can always call at any time and I will happily notarize your latest memorandum or send you more memorandum forms if you have used your last one.

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My own little miracle……

        My husband has encouraged me to try something new this year with my newsletter and blog posts.  He has asked that I make them more personal and tell more stories about myself.  He says they are more endearing to the reader.  I think he, as my editor, does not want to read any more about Wills, public benefits or insurance policies.  But, I have decided to take his challenge to heart.  The problem is that I am just not so interesting.

This month I was at a complete loss as to what to write about.  What interesting thing has happened to me since the excitement of cleaning out the garage?   None…..

As a matter of fact, this was not a great month.  Two weeks ago, I lost my earring.  Now this may seem like no big deal, but it was a special earring.  It was a freshwater pearl, probably worth no more than $50.00 for the set.  But, my husband had given me that earring on our 5th anniversary.  I was in law school and he was a first year teacher.  We were very poor, very stressed out, and $50.00 was probably all the money he had to his name.  It was a gift that I treasured and that I hoped to wear for the rest of my life.  I cannot imagine a $5,000.00 pair of earrings having more value in my eyes.

To make matters worse, in two weeks I was to go on a United Methodist Women’s retreat with one of my very best friends in the world, my precious sister-in-law Christine.  However, when I mailed my check in last month, it got returned for an incorrect zip code.  So, I resent it.  Yesterday I got an email from Christine that the check was still not there and to call a number and talk to them about it.  So, I called the number this morning and it was disconnected.

Knowing this was a sign from God that I was not to attend this retreat, I sent an email to the Church letting them know that I was unable to reach them at the number given.  I expected no call back and had written this weekend off.

A few minutes later I got a call from the woman planning the retreat.  I have never met this woman but I just blurted out, “I think this is a sign from God that I am not to go on this retreat.  I just do not think He wants me there.”  The sweet woman said no, and that she mistyped the number and they had lost a few other checks as well.  She continued on about how God certainly wants me there and that these were certainly not His acts.  Honestly, I had sort of quit listening to her.  As you all know, I think hard about the decisions I make, but when I make them they are solid.  I had already decided God did not want me on this retreat.   Surely if He did, He would not keep letting these mishaps happen.  My phone started cutting out as she spoke, and I moved to the window to try to get better reception to tell her I was not coming.  As I did so, I looked down on the floor in front of my office window and there it was shining in the light… earring.  The earring I had painstakingly searched for in my office, my home, my car, the Courthouse, even the grocery store.  It was lying unharmed in the light of the window I open every day, in a spot twice vacuumed since the loss of the jewelry.  Certainly, if I was looking for my sign from God, there it was shining in the light of his Sun.

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