THE E.P. EXPRESS Volume 9, Issue 1 FOS’S Estate Planning Newsletter Spring 2021 an Ounce of Prevention

THE E.P. EXPRESS Volume 9, Issue 1 FOS’s Estate Planning Newsletter Spring 2021 An ounce of prevention. . . . Editor: Diane Slomowitz

ESTATE PLANS CAN ADDRESS MENTAL HEALTH ISSUES

As the COVID-19 pandem- so harshly affect an individ- his personal and/or financial tions and, if needed, inpa- ic enters its second year, ual’s decision-making abil- affairs—a health care power tient or outpatient mental many are experiencing its ity that the individual needs of attorney is still a good health treatment for the prin- psychological fallout. continuing supervision and protective step, in case the cipal. attention. issues at some point become Grief, fear, anxiety, depres- incapacitating. Along with the health care sion. Mix in hope (dare we What does this have to do power of attorney, family hope?) from the COVID with estate planning? Plenty. In a health care power of members should consider vaccines, and our tear ducts attorney, the principal desig- obtaining a financial power continue to get a good An appropriately tailored nates a trusted person as of attorney over the individ- workout. estate plan can help prevent agent to make health care ual, naming a trusted and the potential financial and decisions on his behalf if he responsible person as his or For most of us, these are physical devastation that or she is unable to do so. her agent. normal situational respons- mental illness may cause, es, which will hopefully without the need for costly, While this document is usual- This document would pro- lessen when the pandemic lengthy, divisive, and public ly described in the context of vide a mechanism for the eventually recedes. guardianship proceedings. an incapacitating physical payment of the principal’s condition, such as a coma, it medical treatment costs, Not all psychological is- Powers of Attorney also applies to an incapacitat- medical and nonmedical sues, however, are situa- ing mental illness. bills, and account deposits If a person has mental health tional. and transfers. issues but is still legally The designated agent could Some mental health issues competent—able to handle obtain doctor visits, medica- Estate Plans, cont. on pg. 2

EQUAL IS IN THE EYE OF THE BEHOLDER Your oldest child is a suc- been unemployed since the Zooms with your spouse al- article on the family discord cessful businessman with a COVID-19 pandemic began most every hour. sown from unequal inher- high salary, a working wife last year, and you are paying itances:nytimes.com/2021/ and two teenage children. their expenses until they Four children, in different 02/19/business/estate- He lives in another state, find work. They live in town financial circumstances and planning-inheritances- calls once a week and visits and provide most of the with different relationships to retirement.html once a year. meals for you and your you and your spouse. In other spouse. words, often a typical family. True, many parents divide His younger brother, who is their estate equally amongst single and childless, left a Your youngest married into Should these oh so different their children. However, you modestly paying job to act a wealthy family in another children receive equal shares don’t have to. as the unpaid live-in care- state and is a stay-at-home of your and your spouses’ giver for your ailing spouse. mother to a young child. She estate? Would that be fair? These are hard questions also helps her sister finan- To them? To you? with even harder answers. The next in line is married cially, visits you three or There is no right or wrong with three pre-teen children. The New York Times, for its here. four times a year, and part, recently published an She and her husband have Equal is in the Eye, cont. on pg. 3 REMINDER: GIFT TAX RETURNS FOS’s ESTATE PLANNING Gift tax returns are due on April 15th (unless extended), although most people won’t ATTORNEYS pay any tax. The 2020 annual exemption for most gifts is $15,000 per person, per recipient.

Some gifts are not taxable even over $15,000, including gifts to U.S. citizen spouses, FOS shareholder most gifts to charities, payments directly to health care providers for medical services for others and payments directly to schools and colleges for another person’s tui- Allan T. Young tion. The exclusions for medical services and tuition are available regardless of the relationship between the donor and the person benefiting from the payment.

Moreover, the lifetime gift tax exemption of a whopping $11.58 million applies for A Certified Public Accountant any taxable gifts made in 2020. Most gifts to charities and payments for medical ser- (CPA), Al worked at the Big 8 Ar- vices or tuition do not need to be reported on a gift tax return. thur Andersen accounting firm before joining FOS. All other gifts exceeding $15,000 must be reported on a gift tax return, so the IRS can keep track of the use of your lifetime exemption. Al is a member of the Greater Mil- waukee Foundation’s Herbert J. Mental Health Issues, cont. from prevented the proceed- his or her support and Mueller Society. pg. 1 ing’s pain, time, expense welfare as needed. He is a past Chair of the Wisconsin It would also, for exam- and publicity. Bar Association’s Taxation Section. A trust may also provide ple, allow the agent to Powers of attorney, of that the individual re- Al is a former Chair of the Milwau- stop any exorbitant pur- course, cannot be created ceive specified amounts kee Bar Association’s Taxation Sec- chases or financial “gifts” when the principal is not at different ages (i.e. tion. during a manic episode. legally competent to sign $10,000 at ages 40, Al is a member of WICPA’s State The alternative to volun- them. And they are not a 50…) or at different du- Tax Committee and the Waukesha County Estate Planning Council. tary powers of attorney is guaranty against future rational increments (i.e. a guardianship, some- lawsuits. $10,000 every five years). times called a conserva- Even so, they are worka- torship. ble tools to keep those we The specific distribution- Here, the court appoints a love safe and help them al scheme will depend on guardian for a legally lead their best lives. the assets and prefer- ences of the person creat- incompetent person until Trust Provisions FOS shareholder the court determines the ing the trust, in conjunc- person can renew han- Some persons with mental tion with the medical and Gregory J. Ricci financial needs of the dling his affairs. illness receive government assistance such as SSI recipient. One example is the dec- Disability payments. ades-long judicial conser- Mental health issues are Greg worked at the Big 8 Arthur vatorship over the person- These programs common- hard enough to address Andersen accounting firm before al and financial affairs of ly prohibit a recipient without the court sys- joining FOS. He is a CPA. singer Britney Spears. from receiving over a des- tem’s added intrusion. ignated amount of in- An appropriately de- Greg served on the Board of the There, many court fights come. Wisconsin Bar Association’s Taxa- occurred over whether signed estate plan, in- tion Section. Spears’ father should re- A properly designed Spe- cluding powers of attorney and tailored trust He also served on the American Bar main conservator and how cial Needs Trust can pro- Association’s Fiduciary Income Tax her finances should be vide some financial sup- provisions, can help pro- Committee. managed. port to the recipient with- tect one suffering from mental illness, their Greg is a member of the Greater out running afoul of this Milwaukee Foundation’s Herbert J. Spears likely did not have designated maximum. friends and family. a health care or financial Mueller Society. power of attorney before For one not receiving ben- He is also a member of the Milwau- the conservatorship. efits, tailored trust lan- kee Estate Planning Forum. guage can ensure the indi- If true, they might have vidual receives funds for The E.P. Express - An ounce of prevention... Volume 9, Issue 1

STICKY NOTES ARE NO SUBSTITUTE FOR AN ESTATE PLAN Zappos.com is many shop- other estate plan. individuals, organizations ey, time, and certainly frus- pers’ go-to online shoe store. or charities he wanted to tration. What he did leave was a receive part or all of his Tragically, Zappos founder huge mess. assets when he died? It is rumored that Hsieh and retired-CEO Tony Hsieh suffered from mental health unexpectedly died from a Lawsuits have already been Probably not. issues. house fire in November 2020. filed against Hsieh’s estate seeking chunk after chunk of Had he done so, he could If so, Hsieh and/or his fami- Hsieh was not married and is his assets. have created a will, trust, ly could have used some of believed to have had no chil- beneficiary designations the tools described in this dren. It will take months, if not and other related docu- newsletter’s article “Estate years, to validate or invali- ments, to make sure that Plans Can Address Mental When he died at age 46, he date these claims. happened. Health Issues” to protect had built a fortune estimated individuals with mental To begin to clean up this at $840 million.* Instead, Hsieh and any health issues. mess, Hsieh’s father and intended beneficiaries will As part of his fortune, he held brother had to go to court to be bound by Nevada’s Don’t be like Hsieh. interests in hundreds of com- open a public probate case intestacy laws. panies. and be appointed executors Create or update your estate of his estate. Under them, his assets plan. After Hseih’s death, thou- will likely pass only to his sands of sticky notes were They could have avoided parents. found on the walls of his resi- obtaining court approval for dence (unaffected by the fire), their roles, had Hsieh named Hsieh may never have *wgno.com/news/whats- with each note representing a them as trustees in a trust. thought about any estate next-for-zappos-ceo-tony- possible business deal, prom- plan, much less his. hsiehs-fortune-longtime- ise or loan.** They would not have had to friend-files-lawsuits/ go to court at all, had Hsieh Or he may have believed Hsieh, however, left no mas- created an estate plan. that, at his relatively **nypost.com/2020/12/14/ ter list of his assets, including young age, he had time to tony-hsieh-left-behind- his companies, contracts and Hsieh could have then di- create one. sticky-notes-complicating- loans, or his obligations. rected the transfer of his as- estate-mess/ sets outside of court. Either way, his inaction He also left no will, trust, or will cost his family mon- Did Hsieh think about which

Equal is in the Eye, cont. from pg. 1 cially okay for now, hasn’t Hard questions, indeed. misunderstandings and sib- even hit 30. Her marriage ling rivalries. Maybe you want to give an has never been solid and In the end, how to divide extra share to your caregiver divorce may be in her future. your estate is up to you. Better yet, consider disclos- son, to acknowledge the earn- Even if it’s not, she’s always ing your dispositional ings he gave up to come If you do decide to divide been needy and would never scheme to your children home, his modest circum- your assets unequally, you get over receiving a “lesser early on--and often, if they stances, and his extraordinary can take some steps to share.” need it. kindness to his mother. lessen the fallout. That leaves your financially Having these hard conver- And it could be that your old- For example, consider troubled daughter. You love sations will let you explain est son, who seems to be fi- explaining your decision- her, of course. But giving her your reasoning, answer nancially set for life, doesn’t making in a short para- an equal share may be unfair their questions, and hope- need any more money. He graph of your will or trust to your other children, given fully forestall hurt feelings might be just as happy to have or in a memorandum kept the substantial sums you’ve (justified or not). the portrait hanging in the with the rest of your estate already given her. Fairness, living room. planning documents. And assure you that you however, may not matter if made the right decisions for she never regains her finan- On the other hand, your This could help prevent you and your family. youngest who, while financial footing. Postage 622 N. Water Street Suite 500 Milwaukee, WI 53202 Phone: 414-273-3939 Fax: 414-273-3947 www.foslaw.com Fox, O’Neill & Shannon, S.C. provides a wide array of Address label business and personal legal services in areas including corporate services, litigation, estate planning, family law, real estate law, tax planning and employment law. Ser- vices are provided to clients throughout Wisconsin and the United States. If you do IN THIS ISSUE not want to receive future newsletters from Fox, Page 1 Mental Health Issues/ Page 3 Sticky Notes are No O’Neill & Shannon, S.C. Equal is in the Eye of... Substitute for an Estate Plan please send an email to in-

[email protected] or call us at (414) 273-3939. Page 2 Reminder: Gift Tax Page 4 Do You Really Want Returns Aunt Kaye to Know...

This newsletter is for information purposes only and is not intended to be a comprehensive summary of matters covered. It does not constitute legal advice or opinions, and does not create or offer to create any attorney/client relationship. The information contained herein should not be acted upon except upon consultation with and the advice of professional counsel. Due to the rapidly changing nature of law, we make no warranty or guarantee concerning the content’s accuracy or completeness.

DO YOU REALLY WANT AUNT KAYE TO KNOW YOU’RE LEAVING NOTHING TO UNCLE BERNIE?

Some people don’t care if their youth program in his child- want to exclude? vor. bequests become public. Oth- hood neighborhood. ers want to keep them private For many, the answer is a re- Similar results can be obtained but don’t know how to do so. On the other hand, The Cars’ sounding no. for financial accounts through Or, if they do, don’t know Ric Ocasek expressly exclud- “payable on death” designa- The key to keeping your dis- how to avoid disclosure. ed estranged wife, Model tions. Paulina Porizkova, from his positional scheme private is to These estates often end up in will for supposedly abandon- create a proper estate plan. For retirement accounts and probate court. Their public ing him during his illness. insurance policies, proper ben- Instead of describing specific wills can, at times, yield “good eficiary designations can pre- bequests in a will, which is celebrity gossip.” Porizkova denies this claim vent them from becoming part and has challenged the will in filed with the court, you can of a probated estate. Legendary comedian Jerry court. use a trust, which is not usual- Stiller (“Serenity now!”) for ly filed and so avoid public These are just a few examples example, bequested $150,000 These public documents, disclosures. of how an appropriately craft- to his assistant, for aiding the which allow us to be voyeurs ed estate plan can keep the Real estate, if not titled in the growth of the careers of Stiller into others’ lives and deaths, public’s prying eyes away trust’s name, can be titled and fellow-comedian wife raise a fundamental estate from your dispositional jointly with your spouse or Anne Meara. planning question. scheme. under a “payable on death” In addition to his family, he Would you want the world to deed. On the first death the And save your family the time also left funds to his alma ma- know to whom you bequeath property will automatically and expense of a formal pro- ter Syracuse University and a your assets? And whom you become property of the survi- bate proceeding.