North Carolina courts have provided that a “fiduciary relation” exists in all cases where there has been a special confidence reposed in one who in equity and good conscience is bound to act in good faith and with due regard to the interests of the one reposing confidence.  Furthermore, North Carolina courts provide that a fiduciary duty can arise by operation of law or based on the facts and circumstances.  In the case of estate planning and estate administration, we are speaking of clearly defined fiduciary roles which arise as an operation of law.  The primary examples are agent and … Continue reading →

While many are fortunate enough to create a Last Will and Testament during their life dictating the disposition of their estates, many individuals pass away unexpectedly or simply lack the resources, knowledge, or motivation to create one prior to death.  These individuals are referred to as Intestates and, for individuals who pass away as residents of North Carolina, the disposition of their estates is dictated by the North Carolina Intestate Succession Act.  The North Carolina Intestate Succession Act (Chapter 29 of the North Carolina General Statutes) provides the scheme by which property passes from a person who dies without a … Continue reading →

While I am not a CPA or tax attorney, I am often confronted with tax matters in my estate planning and estate administration practice.  In this blog, I will focus on filing any outstanding federal and state income tax returns for a deceased individual. As a disclaimer, this blog should not be taken to provide tax advice and is intended only as general information on the types of returns and appropriate parties to sign. Information in this blog is gathered and, in some places, quoted directly from irs.gov. Consultation with a CPA is highly encouraged before any filing decisions or … Continue reading →

While I am not a CPA or tax attorney, I am often confronted with tax matters in my estate planning and estate administration practice. In this blog, I will focus on federal income tax returns for estates (Form 1041) versus federal Estate (and Generation-Skipping Transfer) tax returns (Form 706). As a disclaimer, this blog should not be taken to provide tax advice and is intended only as general information on the types of returns. Information in this blog is gathered and, in some places, quoted directly from irs.gov. Consultation with a CPA is highly encouraged before any filing decisions or … Continue reading →

With my primary areas of practice in estate planning, estates and real estate, co-owned real estate is a frequently discussed topic with clients.  North Carolina recognizes three types of co-ownership in real estate.  First, tenancy-by-the-entirety is a type of co-ownership in real property reserved exclusively for spouses.  Tenancy-by-the-entirety has built in rights of survivorship and protections against the creditors of one spouse.  Second, joint tenancy is a type of co-ownership for non-spouses with rights of survivorship which means when one co-owner dies, their share is automatically vested in the surviving owner/s.  Joint tenancy in North Carolina at one time required … Continue reading →

North Carolina requires the requisite capacity for an individual to sign legal documents.  Different legal documents require different levels of capacity.  Executing a Last Will and Testament requires testamentary capacity.  Executing a power of attorney requires contractual capacity.  Other legal instruments such as executing a deed require their own type of capacity.  Of importance, there is a presumption that every individual has capacity.  Declining mental and physical health are not enough to overcome this presumption, but clear indications of incapacity derived through conversations with an individual or medical information may overcome such presumption.   Additionally, capacity is not always fixed but … Continue reading →

The two primary health care documents attorneys prepare for clients as part of an estate plan are a health care power of attorney and an advance directive.  An advance directive is also referred to as a “living will” or a “declaration for a natural death.”  A health care power of attorney may contain an advance directive, in which case there may be only one multipurpose health care document in an estate plan. Health Care Powers of Attorney A health care power of attorney is a document where the principal appoints an agent to make major medical decisions on their behalf … Continue reading →

The two primary health care documents attorneys prepare for clients as part of an estate plan are a health care power of attorney and an advance directive.  An advance directive is also referred to as a “living will” or a “declaration for a natural death.”  A health care power of attorney may contain an advance directive, in which case there may be only one multipurpose health care document in an estate plan. Health Care Powers of Attorney A health care power of attorney is a document where the principal appoints an agent to make health care decisions on their behalf … Continue reading →

Early in my career and as I began specializing my practice in estate planning, I always found aspects of drafting and explaining health care powers of attorney and advance directives to be peculiar to my background.  Using terminology such as “persistent vegetative state”, “advanced dementia” and “artificial hydration and nutrition” felt out of place in a law office.  Additionally, evaluating a person’s mental capacity requisite to execute certain legal documents was daunting with no academic background in physiology.  I had not taken so much as a basic biology course since my freshman year at North Carolina State University circa 2002/2003.  … Continue reading →

All homeowners are responsible for real property taxes collected by the local taxing authority.  The antiquated legal terminology for this type of tax is an ad valorem tax, which is defined as a property tax based on the assessed value of the property, which may or may not be equivalent to its market value.  The local taxing authority assesses the value of your home or other real property and charges you a tax based on the applicable tax rate.  You can also make a timely appeal of an assessed value determination.  There are many programs and regulations in North Carolina … Continue reading →

For estate planning attorneys, the initial consultation with spouses can have some awkward moments to say the least.  Unlike with unmarried individuals, there is typically no diving directly into the minutia.  First, the attorney must recite a rather robotic disclaimer that, while one attorney representing both spouses with respect to their estate planning is rather common, it is indeed a conflict of interest from a professional responsibility perspective.  The attorney may go on to say that each spouse has the right to obtain separate counsel, and that such action is advisable, but offer to proceed with representing both spouses if … Continue reading →

Losing any loved one is difficult, but losing a spouse adds another dimension of not only grief, but anxiety, fear and confusion about the future. A marriage is a team effort – duties are delegated with respect to finances, home maintenance, social graces, and the many other elements of domestic life. And so, when one spouse dies, in addition to the grief felt, the survivor is often overwhelmed by taking on new duties which were delegated to their partner prior to their death. There are, of course, many family dynamics and there can be many variations and complexities, but in … Continue reading →

Whether it be a parent, grandparent, or otherwise, when a loved one dies, creating a “to do” list is not the first thing often on a grieving family member’s mind.  However, we do live in a check it off the list, “get it done” type of world and so I often have family members call me the day of or day after the death of a loved one asking for counsel.  I get questions such as “should we go to the courthouse?”, “when is the reading of the Will?” and “should I pay [enter outstanding bill here]?”.  All of these … Continue reading →

Estate planning is not a topic on the mind of many vibrant 20 or 30 somethings often still in the process of building an estate for which to plan.  However, this can change quickly for young couples welcoming their first child into the world. As an attorney in my 30s, I often admit to clients that I neglected my own estate planning until the birth of my daughter. When you first bear the responsibility of becoming a caregiver of a truly dependent and initially helpless human being, it can quite significantly change your perspective. Even in cases where young parents … Continue reading →

Piggybacking off my last blog, many estate planning clients may find themselves considering the question of whether a Last Will and Testament is sufficient for their estate planning goals or whether they also need a living trust. First, it is necessary to state that a living trust is an addition to an estate plan and not in lieu of a Last Will and Testament. If one decides a living trust is needed for their estate planning, a pour-over Last Will and Testament is also part of the mix. A pour-over Will distributes all property which may end up passing through … Continue reading →

Many times, when I meet with estate planning clients for the first time, they ask that I tell them what they “need.” While I often preach the mantra that estate planning should not be “cookie cutter” and is not a one-size-fits-all approach, it is fair to say that there are three (sometimes four) essential estate planning documents that everyone needs at least by the time they approach retirement age. While the contents can vary between clients, the need for the documents applies to everyone. In this blog, I highlight these three documents. Durable General/Financial Power-of-Attorney The North Carolina Uniform Power … Continue reading →