Estate planning, with your minor children in mind, requires more than simply choosing someone to raise them. Another equally important consideration is who will manage the money and property that your children will inherit. Certainly, they cannot do it themselves. While you can leave instructions in your will or living trust, there are many issues that need to be addressed. For example, you need to know exactly how to leave real estate behind for your minor child.
Why early planning is a must
It is true that most parents leave everything to each other, expecting the surviving parent to care for the children. In those situations, the children are named as alternate beneficiaries. On the other hand, single parents often leave all of their property directly to their children. In either case, it is necessary to plan for the possibility that your children will receive their inheritances when they are still too young to manage it themselves. Someone competent and trustworthy needs to manage the property for them. More importantly, real property comes with its own set of issues that need to be considered.
Property management choices
If you do not want to rely on a court-appointed guardianship for your children, but you want to avoid the possibility that your child might not be mature enough to manage an inheritance wisely, there are a number of strategies. In order to protect your children and their inheritance it is important to choose someone in advance to manage the property your minor children will someday inherit. There are several ways to accomplish this, including naming a custodian under the Uniform Transfers to Minors Act.
The Uniform Transfers to Minors Act
The Uniform Transfers to Minors Act, adopted by most states (including Nevada), allows you to select a “custodian” to manage the property you leave to your child. If that child is under the age of majority at the time of your death, the custodian automatically steps in to manage the property. This can easily be accomplished by titling the property in the name of the minor, naming the adult as custodian under the Nevada UTMA. Typically, the custodianship ends automatically once the beneficiary reaches a set age, between 18 and 25. It is best to state the age in the deed, itself. If you want your child’s inheritance to be managed longer than that, have greater control and discretion, a trust would be a much better option.
What if I don’t provide for property management?
If you have not arranged for management of your child’s inheritance, then the probate court will do so, by appointing someone as the child’s “property guardian.” The court-appointed guardianship can be expensive and complicated, with frequent reporting requirements and limited management authority.
Legal issues inherent in real estate
Inheriting a house can result in its own set of unique issues. Couple that with the complications of minor inheritance, and the advice of an estate planning attorney becomes very valuable. Will the child live in the house, or should it be rented or sold? Another consideration is whether the home needs remodeling or upgrading. An inspection may be necessary to determine what needs to be done to the house, before it’s sold or rented. These, and other concerns can be discussed with your estate planning attorney.
If you have questions regarding inheritances to minor children, or any other estate planning needs, please contact Anderson, Dorn & Rader, Ltd. by calling us at (775) 823-9455.
Whether your children are visiting their grandparents out of town, or they are away at camp for two weeks, there may come a time when you will be unavailable to consent to medical treatment for your children. As stressful a thought as that might be, there are ways to handle this situation. It only takes a little bit of planning. Creating a medical power of attorney for minor children is the easiest and most effective way to give you peace of mind, when you are away from your kids.
The purpose of a medical power of attorney for a child
Because it is not a true power of attorney, it is also referred to by some as a child medical consent, a medical power of attorney can be used whenever parents are unable or unavailable to provide consent for their child’s medical treatment when it is needed. This important legal document will provide your child’s caregiver during that period of time, the authority to make medical decisions for the child, which would normally require a parent’s consent.
Why would a medical power of attorney be necessary?
Some people do not realize that health care personnel are not allowed to perform certain types of treatment on a minor without the parents’ permission. Typically, this includes non-emergency, life-saving procedures. In other words, an ER doctor would be allowed to do whatever is medically necessary to save your child’s life, but short of that, permission is most likely required. A medical power of attorney would allow the temporary guardian listed on the document to give consent, just as the parents would. The power of attorney would only become effective if necessary.
When should I create a medical power of attorney for my child?
A medical power of attorney can be very useful in a variety of situations. If you are travelling and leaving your child in the care of a friend or relative, a medical power of attorney is a good idea. When children go to overnight camps or boarding schools, parents are often required to sign a similar consent form. Many people also use medical powers of attorney for grandparents, babysitters and nannies. The choice is yours.
What types of power can be given?
In most cases, a medical power of attorney for a child provides rather limited powers. What it does not do, is transfer any parental rights, other than the right to make health care decisions. The terms of the power of attorney can be drafted so that it only covers certain types of medical situations, such as emergencies. It can also provide specific dates that the power or authority is valid. A medical power of attorney is not effective if the parent becomes disabled or dies.
Limitations on the duration of medical power of attorney for a child
Each state typically sets the maximum amount of time a medical power of attorney for a child can remain valid. For parents who are in the military, however, exceptions are often made to allow for a longer duration. Usually, this type of power of attorney is considered “nondurable,” meaning that it ends if the parent becomes incapacitated or incompetent.
If you have questions regarding medical powers of attorney for children, or any other estate planning issue for families with minor children, please contact Anderson, Dorn & Rader, Ltd., either online or by calling us at (775) 823-9455.
There is a unique area of guardianship law referred to as “standby” or “pre-need” guardianship, which allows for the special transfer of child custody in specific situations. Each state has its own position on this law, and not all states allow it. This article will discuss the Nevada standby guardianship laws and how they can be used as part of your estate plan, to ensure the protection and care of your minor children, if something should happen to you.
A standby guardianship, or pre-need guardianship, is a mechanism for parents to prepare for the future care of their children, upon their death or incapacity. Typically, the parent making the declaration or nomination is chronically ill, or has been diagnosed with a terminal illness. Approximately 26 states have passed legislation recognizing this very specific type of guardianship. This type of guardianship is only triggered by the parent’s death, mental incapacity, or physical debilitation. As such, the named guardian is on “standby” until that triggering event occurs.
In Nevada, a parent is allowed to nominate or appoint a short-term guardian in writing for the child without approval of a court, as long as it is for an unmarried minor child, of which the parent has legal custody. If the child is age 14 or older, he or she must be notified and provide written consent.
The appointment of a short-term guardian must be in writing, and it becomes effective immediately upon execution. The document must identify the appointed guardian and include the date on which the guardian is appointed, the name of the parent appointing the guardian, and the minor child for whom the guardian is appointed. The document must be signed by the parent and the guardian, in the presence of a notary public.
A short-term guardian serves for 6 months, unless the written instrument appointing the guardian specifies a shorter term or specifies that the guardianship is to terminate upon the occurrence of an event that takes place sooner than 6 months. The appointment of a short-term guardian does not affect the rights of the other parent of the minor.
A standby or short-term guardian cannot be appointed for a minor child if there is another parent whose parental rights have not been terminated or whose whereabouts are known. If the other parent is willing and able to care for the minor, the rights of that parent must be considered before appointing a short-term guardian.
If you have questions regarding guardianships, or any other estate planning needs involving minor children, please contact Anderson, Dorn & Rader, Ltd., either online or by calling us at (775) 823-9455.
A report was made available by the U.S. Census Bureau in 2010 stating that around 26% of minors under the age of 21 were living in single-parent households - an alarming statistic.
Everyone hopes to live a long and healthy life, and in fact the average lifespan at this time is 78 years. Of course, this is an average, not a guarantee. Everyday we read reports about young people dieing and leaving minor children behind.
We all recognize the fact that accidents take place every day that kill young people. Other young adults pass away as a result of catastrophic illnesses. It is just not going to happen to us, right?
When people who die at a young age leave behind minor children, it is seldom that they have taken the time or opportunity to properly provide for their welfare.
The children of single parents are vulnerable. All single parents absolutely must have an estate plan in place that names a guardian to care for the children.
We should also have sufficient life insurance to provide a financial underpinning for the children throughout their lives. To make sure that the funds are properly managed should this become necessary you could include a testamentary trust in your last will. You may want to consider a revocable living trust instead, so a court does not need to supervise the guardian with annual hearings.
To learn more about why estate planning is so important for the parents of dependent children please take a moment to download our free report and read it at your earliest convenience: Estate Planning for Parents of Young Children
A lot of people procrastinate when it comes to estate planning, and in fact the majority of Americans have not executed all the appropriate estate planning documents.
This pattern of procrastination is not confined to single individuals who have no children. Many parents who have minor children do not have an estate plan in place either, and this is absolutely unwise.
To lend a hand and provide information we have created the K.I.S.S. the Kids program.This acronym stands for "Keep the Inheritance Safe and Secure for the Kids."
We want people to understand just how important it is to make sure that their minor children are provided for financially, while avoiding foster care or protective custody. Also, parents need to understand that children cannot consent to medical procedures. If you happen to be away when a child needs medical attention, who is legally authorized to give consent?
As young people, we tend to procrastinate with regard to estate planning is because we feel we will have plenty of time to execute an estate plan "later on." Unfortunately, later on arrives too soon for many families and their planning is not in place.
The stark reality is that people of all ages pass away every day, and when you go through life without an estate plan you are taking a major risk. Sadly, you will not be the person who pays the price if the unthinkable was to take place. It is the children that you will be leaving behind that would suffer the consequences.
We invite you to visit our webpage that is dedicated to the K.I.S.S. the Kids program. To get there simply click this link: Anderson, Dorn & Rader Present “K.I.S.S. the Kids”
There are a lot of details to take into consideration when you are planning your legacy, and the best way to address them is with the assistance of an experienced estate planning attorney. Rather than being consistently confronted with a series of unanswered questions as you think things through it is much simpler and more efficient to sit down with a legacy planning professional and work through the process from an informed perspective.
Experienced estate planning attorneys know how to proceed under any circumstances and they also understand how to adjust your estate plan on an ongoing basis as changes both within your life and throughout society as a whole take place that impact your existing plan.
One of the intricacies that people often face when they are engaged in inheritance planning involves providing for minor children. There are a number of different ways to proceed, and one of them would be to create a trust and make the child the beneficiary.
You can stipulate whatever you would like to in the trust with regard to what expenditures the trust is empowered to make in behalf of the child while he or she is still a minor. The grantor could then go on to set forth the terms for distribution of assets after the child becomes a legal adult.
Some people allow for the transfer of the total lump sum when the child reaches a particular age, and others arrange for more gradual distributions. You could even choose to include incentives such as allowing for regular distributions while the beneficiary remains in college with a lump sum to follow upon graduation.
Short of creating a trust you could name a property guardian in your will or appoint a custodian under the Uniform Transfers to Minors Act. At a minimum, parents of minor children must have a will where a guardian of the person of your children can be named.
Providing for minor children is an important part of many estate plans. If you would like to learn more details, simply arrange for a consultation with an experienced estate planning attorney.
No one wants to consider dying before their children reach adulthood, but it is a very real possibility. Making a guardian plan for your children after your death is the best way to make sure they are safe and happy. To start a guardian plan, make a list of possible caregivers.
An older guardian, such as a grandparent, will have life experience and maturity, but may, with aging, become physically unable to attend to younger children. On the other hand, a child who has already reached adulthood may have a very close relationship with your younger children. You must take into account whether or not that older sibling will have enough life experience to provide proper guidance.
Consider what type of lifestyle is important to you. Do you mind if your caregiver is unmarried? Also consider if your choice has other children and if the added responsibility of your own children may be too much.
It would be best if your chosen guardian could step in to raise your children the same way you would, but that may not always be possible. Each person on your guardian list will have a different parenting style and may teach your children different morals and values. If you prefer that your chosen guardian observe a specific religion, you may want to make this a major consideration in your decision.
What if your chosen person has plans to travel around the world? Or what if that person is doubtful of his or her parenting abilities and is therefore unwilling to take the job? When you narrow your list to five choices, you may want to ask each person if they are willing to take the position.
Your child will do best if the guardian is someone with whom he or she already has a close relationship. If you feel your top guardian choice has had limited access to your child, it would be best to start including that person in your child’s life on a regular basis. This could give you a better idea if that person is the right fit.
As you evaluate all of your caregiver options, narrow your list down to two or three choices and rank them. You can use your second and third selections as backup guardians, in case your first choice becomes unavailable.
For more information on the topic, visit our page on our workshop Keep the Inheritance Safe and Secure for the Kids. If you would like to speak with the experts at Anderson, Dorn & Rader for assistance, schedule an appointment!
Guardianship in Nevada Services
A pot trust (also referred to as family trust) is a single trust for all of the children in the family that is used in the event that both parents die before the children reach a designated age of maturity. It offers some unique pros and cons for your beneficiaries.
An advantage to having a pot trust is that the trustee may be given the flexibility to spend the funds in any way he or she deems fit. That means that little Jimmy could have tuition paid to attend a trade school while Mary's tuition at an accredited university is paid if that’s what the trustee determines is in their best interests. However, if you gave a trustee broad discretion to make these types of decisions, you should be assured that your trustee is someone in whom you can place your confidence to make the decisions as you would desire.
Another consideration is that the trust is set up to operate until the youngest of the children reaches the designated age. Any funds then remaining in the trust would be disbursed equally to all the children. But if there’s a large gap in ages between your children, the older children may be waiting a significant time to receive their portion of the inheritance.
Of course a pot trust is only one toll of many to provide an inheritance for your children after you’re gone. To learn more about inheritance estate planning, get in touch with Anderson, Dorn & Rader.
