When you contemplate the need for an estate plan, you likely focus on the need to protect loved ones in the event of your death. While planning for your ultimate passing is certainly a focal point of the average estate plan, a comprehensive estate plan will accomplish much more. In fact, planning for the very real possibility of your own incapacity is equally important. With that in mind, a Murfreesboro estate planning attorney at Bennett | Michael | Hornsby explains why incapacity planning should be part of your estate plan.
Incapacity Is Not Limited to the Elderly
Like many people, you may associate incapacity with old age. It is true that Alzheimer’s and other forms of age-related dementia increase the likelihood
of incapacity as you age; however, a catastrophic accident or debilitating illness could result in your temporary or permanent incapacity at any age. If you do suffer a period of incapacity, someone will need to step in and take control of your assets and finances as well as make personal and healthcare decisions for you. This is why it is so important to incorporate an incapacity planning component into your comprehensive estate plan.
Healthcare Decisions
Imagine, for a moment, that you are involved in a serious car accident that leaves you unconscious and in need of significant medical care. If you are unable to consent to care and/or make crucial decisions about your medical care, someone else will need to provide consent and/or make decisions for you. If you have not planned for such a scenario, your family and loved ones may disagree on who should step in and have the authority to make decisions. Ultimately, a judge may need to decide who will be your “agent” for the purpose of making healthcare decisions. Not only might the judge choose someone that you would not choose, but the entire legal process may have a lasting negative effect on your family. Worst of all, the individual imbued with the authority to make healthcare decisions for you might make decisions you would never make, such as allowing you to remain alive using life-prolonging measures.
Fortunately, you can prevent all those unwanted outcomes by incorporating advance directives into your incapacity plan. There are two crucial advance directives you may wish to consider executing. A Health Care Power of Attorney lets you designate an Agent who will have the legal authority to make health care decisions for you if you are unable to make or communicate those decisions. This is a legally binding document that physicians, hospitals, and other healthcare providers must honor. The second type of advance directive is a Living Will. This legal document allows you to make critical medical treatment decisions ahead of time in case you cannot make them at some future time. You can decide to accept or refuse things such as artificial nutrition and hydration as well as the use of life support measures, such as a breathing machine.
Financial Decisions
Consider who would take over control of your assets and make financial decisions for you if you were incapacitated in that car accident. If you are married, your spouse may have the legal authority to make day-to-day financial decisions; however, even a spouse’s legal authority over assets can be limited. If you are unmarried, you have an even bigger dilemma. The same applies if you own a business. Once again, careful planning within your overall estate plan is the solution.
A Durable Power of Attorney can provide someone with a significant degree of legal authority to act on your behalf during a period of incapacity; however, a revocable living trust is often the estate planning tool of choice for incapacity planning. A revocable living trust works as an incapacity planning tool by allowing you to be the Trustee of the trust and appointing the right person as your successor Trustee, typically a spouse, adult child, or business partner. As the Trustee, you continue to manage all assets transferred into the trust as long as you are capable of doing so. If, however, you suddenly become incapacitated, control of the trust assets automatically passes to the successor Trustee. The successor Trustee can then control the assets, including buying or selling them, during your incapacity without the need for approval or oversight from a court.
Contact a Murfreesboro Estate Planning Attorney
If you have additional questions or concerns about how to incorporate incapacity planning into your estate plan, consult with an experienced Murfreesboro estate planning attorney at Bennett | Michael | Hornsby as soon as possible. Contact the team today by calling 615-898-1560 to schedule your free appointment.
- Tax Avoidance Strategies for Your Estate Plan - July 2, 2024
- How Minors Can Lose Their Driving Privileges in Tennessee - June 7, 2024
- When Does a Trust Terminate in Tennessee? - March 19, 2024
