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There are so many things to keep in mind when moving out of state. Did we give ourselves enough time to pack? Did we inform all the right people and places? When do I need to get a new driver’s license? Will we need new health insurance? Will the kids like the new school? Oh, I guess we’ll need new voter registration cards, too.

This (admittedly still incomplete) list is full of important things to remember for those relocating to a new state. But don’t forget about your wills and trusts.

It probably took a long time and maybe a fair bit of money to set up your estate plan. And it can be tempting to think that our estate plans will remain viable from the date they’re filed until the day we pass on. However, if we move out of state, we need to be aware that different state laws may change things.

How Might Interpretations of an Estate Plan Differ from State to State?

While the majority of your estate plans should still be well and good in a new state, it is important to understand that different state laws could result in differing interpretations of your will and trusts. Property laws can vary with each state. And some states have common law marriage, which could be affected by a move to a state that does not. Some states have different laws regarding health care directives and powers of attorney.

Colorado is a separate-property state, meaning that property and assets acquired during a marriage are still viewed, legally, as separate property for each spouse. However, some other states are community-property states, wherein property and assets obtained during the marriage are viewed as equally shared between the spouses.

What Estate Planning Documents May Need to Be Reviewed and Revised After Moving?

While most of your estate plans may still be legal in a new state, it would still be advisable to evaluate your estate plans with an attorney familiar with your new state’s laws.

Documents that may need to be updated include wills, living trusts, living wills, advance medical directives, power of attorney, beneficiary designations, and the executor of your estate.

What Are Other Considerations to Be Made in Regard to Estate Plans and Relocating?

Some states have different laws in regard to how a divorce may impact an estate plan. For example, one state’s laws may automatically revoke an ex-spouse’s claims to assets previously laid out in a will written while the two were married. However, a neighboring state may maintain that all language in the will be followed to the letter, regardless of a divorce.

Additionally, while it may not be necessary to change your will’s executor, if they are now living in a different state, it may be best to select someone new who is more readily available. Contact our law firm today at (720) 420-1039 to learn more about how we can help you with your situation.

Colorado law does not require its residents to name a power of attorney agent for their estates. However, in the event that you ever become incapacitated, the court may appoint a conservator to manage the final decisions of the estate. To prevent this, you could select an individual to have your power of attorney, who would then make those decisions instead.

Some online websites will provide templates for POA documents for less than $50. However, you still need to get that document legally notarized, which could cost an additional $50. But if there were errors in the making of this document, then it may not stand up in the eyes of the law.

The average price for a professionally drafted POA document ranges between $200 and $500. The cost can vary depending on the complexity of the document.

The hourly rate for which the power of attorney agent could be expected to be paid for their service should be worked out in the document. Average rates are around $20 to $40 an hour.

WHAT ARE THE DIFFERENT TYPES OF POA?

The types of power of attorney in Colorado are:

• Advance Directive
• Durable Power of Attorney
• General Power of Attorney
• Limited Power of Attorney
• Medical Durable Power of Attorney
• Minor Power of Attorney
• Real Estate Power of Attorney
• Revocation of Power of Attorney
• Tax Power of Attorney
• Vehicle Power of Attorney

WHAT IS TYPICALLY INCLUDED IN A POWER OF ATTORNEY DOCUMENT?

Just as every estate is unique, one should expect that power of attorney documents to differ from case to case as well. But there are some commonalities that one should expect to see in all POA forms, including:

• Title: providing clear identification of what type of POA document it is, for example, a financial POA or a health care POA.
• Date: the document must be signed and dated by all necessary parties.
• Principal: the name and address for who the power of attorney is.
• Agent: the name and address of who has been named as the power of attorney agent.
• Powers: the specific powers and how those powers could be revoked.
• Compensation: what the agent should expect to be paid for their services.
• Notarization: a POA must be notarized for it to be valid.
• Witnesses: Colorado does not typically require witnesses to the signing of a POA, but they could help authenticate the document.

SHOULD A LAWYER BE HIRED TO DRAFT A POA?

Just as you are not required to draft a POA, the document does not necessarily require the professional hand of an attorney. However, with estates where there are many assets to consider or perhaps some conflict over who is to be named the POA agent, it would be advisable to work in coordination with a lawyer in drafting your power of attorney document. Contact our law firm today at (720) 420-1039 to learn more about how we can help you with your situation.

If we ever become too sick or injured to make decisions for ourselves–from Alzheimer’s or a brain injury, for example–conflict may arise. Family members may fight amongst themselves over what is the right path of medical treatment for you. And the court may appoint someone to make financial decisions for your estate.

If you grant an individual or an institution with a durable power of attorney, they will be able to make these legal decisions for you when you are unable to. Bound to serve in the best interests of you, your estate, and its beneficiaries, your POA agent can better protect you and yours from conflict or the courts.

WHAT ARE THE REQUIREMENTS?

You may grant powers of attorney to another party if you are 18 years of age or older and are mentally competent in the eyes of the law. The document must be signed and dated, provide the names and addresses of both the agent and yourself, and be officially notarized. The document must have clear definitions of the agent’s powers and how those powers could be revoked.

A witness is not required for the signing but could provide further authentication. Additionally, a lawyer is not required but could help in making sure that the documents are valid and not full of holes.

WHAT ARE THE COMMON TYPES OF POWER OF ATTORNEY?

In the state of Colorado, there are four primary types of power of attorney:

• Financial Power of Attorney: the agent will have the power to make financial decisions on your behalf, extending, but not limited to, choices relating to real estate property.
• Medical Power of Attorney: the agent has the ability to make decisions regarding your medical care if you are ever incapacitated.
• General Power of Attorney: the agent is entrusted with both the responsibilities of the financial and medical POA.
• Limited Power of Attorney: the agent is held to a customized set of parameters and powers as laid out in the document.

WHAT IS THE PROCESS OF GETTING A POWER OF ATTORNEY?

It is recommended that, as with all legal matters, you work with a professional to ensure that all your documents are valid and will stand up in court.

After you understand what a POA is, you must select your agent(s), then decide what authority you will trust in them. Complete the necessary legal forms and get them signed by a notary. And then, when it’s all done, file the forms with the necessary legal offices. Contact our law firm today at (720) 420-1039 to learn more about how we can help you with your situation.

A trust is an estate planning tool that someone can set up to protect their assets for intended beneficiaries. Trusts are established while the estate owner is still alive and can determine how those assets reach their beneficiaries over time. During that time, the management of the trust is left to a third party, known as the trustee. The trustee will also be responsible for the trust and how its assets are distributed in the event of the death of the trust’s creator.

There are two main types of trusts, revocable trust and irrevocable trust. While similar, the two types of trusts have some key differences that need to be considered. The most notable of those differences is that revocable trusts can be modified over time, whereas irrevocable trusts cannot be altered without the full consent of all trust beneficiaries.

What Are the Advantages and Disadvantages of Revocable Trusts?

The main benefit of a revocable trust is that it allows the trust’s creator, the grantor, to modify the trust over time. The revocable trust (aka living trust), allows the grantor to remove beneficiaries, add all new ones, and change the terms in which the distribution of assets is set to occur. Revocable trusts are valuable for those who wish to protect their assets from probate courts, which can be costly and time-consuming.

The downsides of revocable trusts include the fact that assets within the trust are still subject to taxation, as the grantor is still considered the owner of the assets. Also, in situations like the death of the grantor, creditors and nursing homes can seize assets from a revocable trust to collect on debts.

What Are the Advantages and Disadvantages of Irrevocable Trusts?

The benefits of irrevocable trusts include the fact that assets within the trust cannot be seized by creditors and can potentially largely avoid taxes, including estate taxes upon the grantor’s death. Irrevocable trusts also avoid the process of probate court, granting everyone involved more privacy about the terms and assets within the trust.

However, irrevocable trusts cannot be modified once they are signed into action. The terms of the trust are set in stone unless the beneficiaries allow for changes to be made.

Which Estate Planning Tool is Right for You?

There are many options available to those who wish to draw up a strong estate plan, including several types of trusts, wills, and other legal powers. What estate planning option is right for you is largely dependent on your assets and investments, but also your risk of exposure to taxation.

To better determine whether a revocable living trust or an irrevocable trust is the right option for your estate, you are advised to speak with an attorney experienced in estate plans. Contact our law firm today at (720) 420-1039 to learn more about how we can help you with your situation.

With each new presidential administration come new ideas and new directions for taking our tax laws as a nation. While one president may cut the taxes dramatically, the other could see taxes as the way to fund the future. In 2021, Sen. Bernie Sanders proposed a new tax bill called the “For the 95.5 Percent Act,” named so for the intent to place higher tax rates on the richest 0.5% of America.

Currently, the estate and gift tax has tax exemptions for anything less than $11.7 million. Under the new bill, the number would be brought down to $3.5 million, meaning that it will significantly affect more estates.

How Will This Bill Affect Current Estate Planning Strategies?

Primarily, the new bill will now affect more estates with the burden of taxation. Other considerations for how things may change include:

• Under the newly proposed bill, people will not be able to gift anyone more than $1 million without incurring a gift tax.
• Assets put in irrevocable trusts may not avoid income taxes anymore under the new bill.
• The maximum federal estate tax rate will be raised to 45% for those with an estate worth $3.5 million. For those with estates worth more than $10 million, a 50% estate tax will be enforced. And for estates worth over a billion dollars, the US government would ask for a 60% estate tax rate.
• The new bill will also prohibit the use of valuation discounts for non-business assets and dramatically limit the use of Grantor Retained Annuity Trusts.

When Will the ‘For the 99.5% Act’ Go Into Effect?

There is no guarantee that the proposed bill will ever be signed. However, if and when it does get the signature of the president, the new changes could go into effect at that very moment.

For this reason, if you have a large number of assets in an irrevocable trust, you may want to explore alternative options, as they may be at risk of new taxation before long.

When Should You Speak with an Attorney?

Right now, the new tax bill by Sen. Bernie Sanders and others has not been signed into law and can only be considered a political proposal. However, it is representative of political intentions and could be signed into law at almost any time. If and when that happens, wealthy estate plans could change dramatically.

Contact our law firm today at (720) 420-1039 to learn more about how we can help you with your situation.

Nobody wants to think about their own mortality. We go day by day, trying to live our lives and make things better for ourselves and our loved ones, all the while hoping that we leave our younger generations in a better world than the one we inherited. However, simply hoping for the best is not a proper plan of action. Without proper estate planning, there can be no guarantee that those you leave behind will inherit what you wish.

It is never too early to begin crafting an estate plan. The plan and documents you sign today can speak for you when you’re no longer able to, better ensuring that your beneficiaries are properly taken care of after you’re gone.

What Are Wills?

A will is a legal document that names those who will receive which assets in the event of your passing. The will names an ‘executor’, who will be in charge of the distribution of assets set forth by the documents. In cases of early death with young children, wills may also name guardians for minors who could be left orphaned. There are multiple types of wills, and many can be revised over your lifetime as your estate changes.

What Are Trusts?

Trusts can set aside assets intended for beneficiaries in an attempt to avoid probate. There are several types of trusts available, including irrevocable and revocable trusts. Irrevocable trusts give up legal rights to the assets within, but this has the advantage of avoiding estate taxes. Revocable trusts can be reworked and even revoked over time but are subject to taxation.

What is a Health Care Directive?

In the event that you become incapacitated due to injury or illness and important medical decisions must be made, a health care directive can entrust your loved ones with new authority. This helps limit conflict when making end-of-life decisions.

What is Power of Attorney?

Similar to a health care directive, power of attorney gives your agent financial decision-making powers in case you ever become incapacitated. This can be especially useful for single people who are making estate plans.

What Are Beneficiary Designations?

In creating an estate plan or writing a will, it is important to keep your retirement plan, insurance plan, and bank account beneficiary designations in mind. These designations can sometimes supersede language written into a will, so they must be kept up to date.

What is the Best Estate Planning Tool for You and Your Family?

Basically, everyone has an estate but not every estate planning tool is right for everyone. To better understand which plan would benefit you and your loved ones the most, it is advisable to evaluate your estate with the assistance of an experienced estate planning attorney. Contact our law firm today at (720) 420-1039 to learn more about how we can help you with your situation.