Lahti, Lahti & O'Neill, P.C. Blog

By Mia H. Lahti

For years we’ve been telling our clients to sign and update durable powers of attorney. The reason is that older powers of attorney can become “stale”.

We found an article in the New York Times last month that sheds light on new problems that can still arise after you’ve updated and signed a “POA”.  The article discussed how occasionally financial institutions will not honor a POA that’s not on the institution’s own form.

By Michael T. Lahti

Now that your estate plan is signed, sealed and properly funded, don’t think you can forget about it for the next ten years.

There are times when normal every day events can (and will) affect your estate plan. Part of your overall planning should be to contact your estate planning attorney when these events occur, so your plan can be reviewed and updated.

Following is a series of potentially life altering events that could affect your estate plan. Any of these occurrences should be brought to the attention of your estate planning attorney:

• Having a new child, or adopting a new child.
• A change in your marital status.
• A new daughter-in-law or son-in-law in the family.
• The death of a loved one mentioned in your estate plan.
• A change in health for you, your spouse or your children.
• Inheriting substantial assets.
• A change in the tax code.
• Buying or selling a business.
• Acquiring sizable new assets.
• A setback in personal finances.
• A change in your permanent residency.
• Your executor dies or becomes incapacitated.
• Retiring.
• Winning the lottery. Good luck!

By Michael T. Lahti

Tax Analysts reported that in addition to buying Slurpees, cigarettes, and snacks at 4 a.m., taxpayers will now be able to pay their tax bills in cash at one of 7,000 7-Eleven stores across the United States.

"We continue to look for new ways to provide services for our taxpayers," IRS Commissioner John Koskinen said. "Taxpayers have many options to pay their tax bills by direct debit, a check or a credit card, but this provides a new way for people who can only pay their taxes in cash, without having to travel to an IRS Taxpayer Assistance Center."

By Michael T. Lahti

Tax Analysts reported that Nevada and Wyoming are among the 21 jurisdictions identified as offshore tax havens in the so-called Panama Papers exposé that's based on 11.5 million files leaked from the internal database of Mossack Fonseca & Co. in Panama, the fourth largest offshore law firm in the world.

Specifically, Nevada was listed as the eighth most popular tax haven used by the firm for incorporating entities, ranking above Hong Kong and the United Kingdom, according to initial charts released by the International Consortium of Investigative Journalists (ICIJ).

By Michael T. Lahti

Governor Baker of Massachusetts has proposed legislation that would significantly impact how families can protect their residences in the event of an extended nursing home stay.  The governor is proposing “expanded estate recovery.”   Expanded estate recovery would allow MassHealth to recover benefits paid on behalf of a deceased MassHealth beneficiary, by allowing for the recovery of non-probate assets.  If enacted, this would target existing forms of ownership that families use (such as joint ownership, life estates, and irrevocable trusts) to protect their houses upon death.

By Michael T. Lahti

Florida HB 277, signed into law as Chapter 121, specifies how a county or municipality may determine a homestead's just value for purposes of the homestead tax exemption for eligible persons age 65 or older; potentially increasing the homestead exemption $50,000.

The change amends s. 196.075, F.S.; revising the homestead tax exemption that may be adopted by a county or municipality by ordinance for the assessed value of property with a just value less than $250,000 which is owned by persons age 65 or older who meet certain residence and income requirements; specifying that just value shall be determined in the first tax year that the owner applies and is eligible for the exemption; providing for a refund of overpaid taxes in prior years; providing retroactive applicability; providing a contingent effective date.

By Michael T. Lahti

WASHINGTON -- The Internal Revenue Service recently warned taxpayers about groups masquerading as charitable organizations to attract donations from unsuspecting contributors, one of the "Dirty Dozen" for the 2016 filing season.

"Fake charities set up by scam artists to steal your money or personal information are a recurring problem," said IRS Commissioner John Koskinen. "Taxpayers should take the time to research organizations before giving their hard-earned money."

By Michael T. Lahti

Whether a “Millionaire’s” tax should be imposed in Massachusetts is causing heated debate.  As reported in Tax Notes, opposing sides of an initiative petition in Massachusetts to impose a millionaire's tax recently squared off as the proposal received its first legislative hearing by the Joint Committee on Revenue.  At issue is a petition to amend the state's constitution to levy a 4 percent surtax on taxpayers with annual taxable income of more than $1 million.  Massachusetts’ constitution requires an income tax to be levied "at a uniform rate . . . upon incomes derived from the same class of property," thus it would have to be amended. To amend the constitution to allow for the surtax, legislative approval from at least 25 percent of lawmakers in two successive legislative sessions would be required, and then have voters would have to approve it at the ballot.

By Michael T. Lahti

As reported in TaxNotes , taxpayers can now contribute all or part of their federal income tax refunds to a new tax-free myRA retirement savings vehicle that the Treasury Department officially rolled out November 4. "What makes myRA special is that it reduces many of the common barriers to saving that are an obstacle for many people to get started," Treasury Secretary Jacob Lew told reporters during a conference call.

Earners can now also transfer funds from their bank accounts on a one-time or recurring basis into their new myRA accounts, which were launched nationally after an almost yearlong pilot program, Lew said. "You don't have to worry about fees or minimum requirements, you don't have to worry about investment options, you don't have to worry about losing money, and if there's an emergency, you can have access to the money you put away at any time," Lew said.

By Michael T. Lahti

In a substantive change to its laws, Florida now allows a Designation of Health Care Surrogate, or“DHCS,”, to be effective immediately upon signing, rather than empowering the surrogate only when the patient's physician(s) have determined that he or she is no longer capable of making those decisions.

This question gives the client the choice of using that new approach or continuing the traditional requirement of a finding of incapacity. This is a new theory that will require some fleshing out from experience to see how it works in the real world; the legislature was quick to point out in its suggested form under §765.203 that the principal's decisions are controlling ("While I have decision-making capacity, my wishes are controlling and my physicians and health care providers must clearly communicate to me the treatment plan or any change to the treatment plan prior to its implementation.")

By: Stephen T. O’Neill

Retirement Planning in its most basic form involves accumulating sufficient resources via appropriate retirement vehicles and investment expertise, with the objective of providing yourself a financially secure retirement. But in its highest manifestation retirement planning involves optimizing not just the accumulation component but also the distribution component, as well as the creditor protection component, by minimizing the impact of income and estate taxes and third-party claims while maximizing perpetuation of retirement asset wealth over multiple generations.