Dana Carlson Gentry, Esq., Board Certified in Wills, Trusts & Estates
Did you know that if you are the agent taking care of your Mom’s assets under a durable power of attorney that you must attempt to preserve her estate plan, to the extent actually known by you so long as that preservation is consistent with her best interests? In so doing you must look at several factors which include:
1. the nature and value of Mom’s property;
2. mom’s foreseeable obligations and need for maintenance (i.e., for instance mortgages, medical procedures and medicines, home health caregivers, etc.);
3. minimizing her taxes (such as income, estate, inheritance, generation-skipping transfer, and gift taxes);
4. her eligibility for a benefit, a program, or assistance under a statute or regulation ( i.e., Medicare, Medicaid, Veteran’s Benefits); and
5. mom’s personal history of making gifts (even if you have no express authority to make gifts under the power of attorney document.
Some of these factors may conflict with each other. For example, if you continue a gift plan Mom started, you could make Mom ineligible for a government program such as Medicaid if she is in a nursing home and has exhausted her assets.
If she has four children (you and three others), and four Certificates of Deposit each payable on death to a different child, which one do you cash first to meet her needs and best interests? If you cash in your siblings certificates first, and she passes, and only the one payable to you remains, you may have violated your fiduciary responsibility to your Mom. To minimize your liability as her agent you should keep good records of all receipts and disbursements, and your Mom’s liabilities as well as documentation supporting the reasons for your actions on her behalf. Keep an accurate inventory of all assets and any safe deposit box of your Mom’s every time you access it.
Most importantly, read the power of attorney document and if you have any questions concerning its provisions, consult your attorney before you begin to exercise your fiduciary duties.
