Your land is one of the most valuable assets you own. Most landowners spend significant time and resources managing and protecting their ranch or farm. But what happens if you become mentally disabled and unable to make decisions or manage your affairs? Conscientious landowners need to consider the estate planning
steps necessary to protect their property in the event of their mental disability.
Paradoxically, with better health care many more people are encountering problems with mental disability, perhaps due to an accident, stoke, or dementia. If you become mentally disabled and cannot manage your affairs, how do you want to be cared for, and who is to make the many difficult decisions for you? Who will manage your property? What instructions can you give them to make their job easier and more successful in this stressful situation?
The horror stories in the news about the probate process or end-of-life decision-making usually involve people who did not plan their affairs. These people have an estate plan which can be called the “No Plan” estate plan.
If you do not take responsibility for yourself, your loved ones and your assets then the State and Federal governments step in to answer these questions for you. If you do not plan your estate, the government has a ready-made, expensive, one-size-fits-all estate plan prepared for you which controls you and your property in the event you become mentally disabled. The government plan includes the federal and state laws and court cases regarding:
?conservatorships and guardianships to appoint someone to care for you and your property if you become incapacitated,
?statutes, case law and court proceedings governing end-of-life decision-making if you have not made your wishes known.
This “No Plan” estate plan is the most expensive plan for you and your loved ones, and usually produces the most disastrous results.
The good news is that it is relatively easy to implement a comprehensive estate plan to protect you and your property in the event of mental disability. To address the issue of planning for mental disability, your plan may include some of the following:
?Durable Power of Attorney for Financial and Real Estate Matters, including the necessary Certificates and Affidavits;
? Medical Durable Power of Attorney for Health Care Decision-Making;
?Pre-Need Declaration of Guardian for you;
?Designation of Guardian for minor children;
?Living Will, or Directive to Physician and Family, to establish what life-sustaining treatments you want if you are in a terminal irreversible condition and unable to communicate your wishes;
?Special instructions for protecting assets.
You can also use a living trust to hold assets and appoint a successor trustee to manage your affairs according to your written instructions in the event of your disability. If you have these types of documents, and have named a family member, friend or trusted advisor to act on your behalf in the event of mental disability, you will likely avoid costly legal wrangling, and public probate proceedings.
Certain assets, such as a ranch or farm, or a small business, may require special planning strategies, including added instructions to deal with special problems involved with owning and managing these assets in the event of your disability. For example, many rural landowners have property valued for property tax purposes under an agricultural or wildlife management valuation. This valuation saves them significant amounts of property tax. However, certain activities must be conducted on the property annually in order to continue to qualify for the property tax savings. Your disability agent or disability trustee needs to know what to do to continue these activities in the event of your disability, and protect your property from the loss of these valuations.
For the peace of mind that comprehensive estate planning can bring, contact Thomas Hall
, an experienced estate planning attorney: (512) 894-5426.