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4 Warning Signs Your Elderly Relative May Be the Victim of Financial Abuse

Some of the most disturbing crimes against the elderly involve financial exploitation. While physical abuse is often easy to spot, financial abuse can be more difficult to detect, as victims often have no idea they’re being swindled until their money suddenly vanishes.

Most victims are more than 70 or 80 years old, and involve crimes like fraud, embezzlement, identity theft, along with welfare and insurance scams. If you’re caring for an elderly loved one, be on the lookout for the following red flags of financial abuse:

1. Unusual financial transactions or spending
The most obvious sign an elderly family member is being exploited is if there are sudden changes to their spending, banking, and/or financial practices. At the same time, the person may start behaving secretively, confused, or otherwise atypical about money matters. A few of the most frequent actions include:

● Someone who is normally meticulous about their finances suddenly starts seeing unpaid bills, non-sufficient funds warnings, and/or unexplained credit card charges.
● The elderly person starts opening, closing, or changing banking and investment accounts, especially without regard to penalties or fees.
● Someone with consistent spending patterns starts showing a sharp increase in spending and/or investing.
● The person’s account sees a suspicious increase in ATM use, withdrawals, and/or checks made out to unfamiliar recipients.

2. The appearance of a “new” person in their life
Because they’re often alone and isolated, seniors are particularly susceptible to being “befriended” by strangers who take advantage of their loneliness to exploit them. And it may not be a stranger—relatives who haven’t been around for years can suddenly start spending lots of time with the person.

This situation is particularly dangerous when the new acquaintance, caregiver, or relative spends time in the person’s home, where they have easy access to the person’s accounts, financial statements, and personal documents.

One sign that something is amiss is if the senior acts unusual when it comes to the new caregiver or friend. They may seem nervous when that person is around, stop participating in their usual social events, or be reluctant to speak about the person with you. This is a red flag the new person may be trying to isolate or control them.

3. Unneeded goods, services, or subscriptions
Outside of loneliness, the elderly are often physically unable to handle household chores and maintenance like they used to. Given this, they’ll likely need service providers to take care of the work for them. But every new person they surround themselves with is a potential swindler.

Watch for unscrupulous door-to-door salesmen and home repair contractors, who stop by offering unsolicited products or services, especially related to home remediation issues. And they don’t have to physically present to perpetrate fraud—there are countless telemarketing and email scams that target unsuspecting seniors in order to make a quick buck or steal their identity.

One fairly common scam involves inviting the older person to a free lunch or dinner in exchange for listening to a “seminar” about a financial product or service. The elderly often feel obligated to “buy something” after getting what they thought was a free meal.

Make sure that another adult relative is present before signing any contracts, and always consult with us if you’re unfamiliar with a new investment or financial opportunity.

4. Changes to wills, trusts, titles, power of attorney, etc.
The worst cases of financial abuse of the elderly can even involve the person making changes to wills, trusts, and other estate planning documents. Other potentially harmful changes can involve deeds, refinanced mortgages, property titles, and/or adding someone to a joint account.

Pay especially close attention if the older person seeks to grant power of attorney to someone out of the ordinary, as this can open the door for massive theft of assets and potentially fatal changes in a senior’s caregiving services.

One major advantage to establishing a relationship with a lawyer during your early years is so we can get to know you while you’re young, healthy, and clear, and then monitor if anything goes awry in your later years.

One reason financial scams are so hard to detect is that the elderly—like all of us—are embarrassed to admit they’ve been swindled, or they may not want to get a new “friend” or relative in trouble by telling others about their suspicions.

However, anyone can fall prey to financial fraud, so it’s important the elderly know that you’ve hired us as your Personal Family Lawyer® to provide trusted advice and guidance for all financial and legal matters. We can help secure your family’s most valuable assets with robust legal protections to prevent fraud and scams of all kinds. Call us today to schedule a Family Wealth Planning Session to make the most empowered and informed decisions for yourself and the family members you love.

Tips On Implementing Your Estate Plan

Tips On Implementing Your Estate Plan

Assuming you’ve created a plan that contains your unique goals and wishes for your family, the next step is to ensure that your plan is carried out.  The first tip is to not hide your estate plan.  It’s easy to hang on to “important” paperwork for years, burying the legal “treasure” (your estate plan, and other helpful information) in a mountain of irrelevant papers.  Let’s create an effective map by following these steps:

Fully Fund for Future Feats of Family Fealty

Sorry, just like Jack Sparrow can’t resist Spanish gold, I can’t resist an alliteration.

When you leave assets out of your trust, the plan you carefully crafted with your attorney could go by the wayside.  Create your plan, then transfer your assets into it.  But beware – assets like life insurance and retirement plans have special rules; don’t transfer those assets into your trust without careful instructions from your attorney.

Communicate Clearly

There are two key things I think every parent should communicate to their family, no matter how private they wish to keep the other details of their estate plan.

The first is, tell people who will be in charge, especially the one who will be in charge.  The successor trustee needs to be ready to step in at the right time.  If they don’t know that they’re “it” they won’t know to act.  And everyone else needs to know who to talk to in order to get things moving.

The second thing is that the person who will be in charge next needs to know where the documents are.  And have the ability to get those documents.  If you use a bank safety deposit box, make sure their name is on the account for the box.  Bank safety deposit boxes often present a problem, because the legal documents granting you the authority to access the bank safety deposit box are locked securely in the safety deposit box.  A fire safe box at your home keeps the documents accessible while keeping them safe.

What You Don’t Have to Say

You don’t have to spill the beans on how much money you have or the details of all your assets.  How much, and where are details for another day.  But they are important details for that other day, as I discuss in the last point.

You don’t necessarily have to go into the details of who is getting what.  I do think generally the more you communicate on this point, the more problems you’ll avoid for your beneficiaries down the road.  If the conversation is going to be too awkward, work with your attorney to communicate some of the “why” behind what you’re doing, either in the estate plan or in a separate letter.  Confused kids cause chaos, and chaos leads to expensive litigation.

Create a Map for Later

Stop and think for a minute.  The person you’ve chosen to be the successor trustee has a big job.  At some point in the future, they’re going to be all alone, handling your affairs, using the information you’ve left behind.  Every year the state spends a lot of your money that sits unclaimed, mostly because the people who would have benefited from it had no idea that money was there.  We all have buried treasure; the question is what clues will we leave behind for those who follow.

What To Do When The Current Trustees Become Disabled

What To Do When The Current Trustees Become Disabled

Are you next in line to be a trustee for a family member?  Or, your spouse, who has taken care of everything, is suddenly unable to carry on as before.  With proper planning, you should be equipped to take over immediate medical and financial affairs.  This checklist is for you– what you need to do when neither parent is able to continue caring for themselves or each other. First a disclaimer: while there is a lot of information here, this is a brief, general checklist.  Taking the time to consult with an estate planning attorney about your particular situation is always advised.  My goal in presenting this list is to give you a short list of items that will help you immediately step in and deal with the situation that demands your immediate attention.

Provide Immediate Care

First, take care of yourself.  The role reversal of parenting your parents is a shock, and the mental trauma of seeing your parents suffer can have different effects at different times.  Make sure you have a support network for yourself. You should notify the family of the change in your parent’s condition. Your parent may need ongoing personal attention, including in-home care, hospice or other types of assistance.

Marshall Papers

Locate important papers, including their estate plan, and particularly their Durable Power of Attorney and their Advance Health Care Directive. Once you locate those documents, you’ll need to take copies of the Durable Power of Attorney to any banks or financial institutions you need to manage on their behalf.  You’ll also need to take copies of the Advance Health Care Directive to any medical provider so you can be notified of any medical treatment or recommendations and be able to arrange for any necessary medical treatment.

Consult With Experts As Needed

Review the situation with local estate planning attorney – are there any last minute estate planning decisions that need to be made?  There may be steps that your parents have missed and need immediate action to avoid probate or taxes.  Additional steps may be necessary to protect the estate and qualify your parents for assistance from the VA or Medi-Cal. If you suspect elder abuse, contact an elder law attorney with litigation experience immediately.  Even if you’re not sure, the attorney can help advise you on steps you can take to protect your parents, or discover if abuse did take place. If you need help with record keeping, talk to a CPA about setting up a simple system for keeping important records organized.  A good system will make it much easier for you when it comes to filing taxes, and if there is ever any question about your actions as the agent, you’ll have the documentation you’ll need to protect yourself. Having a conversation with your parent’s insurance agent to make sure that assets are properly ensured, and that the proceeds will go to the correct place.  Have the fire, homeowners, and personal property insurance policies been endorsed to the trust?

Take Necessary Action

An estate planning attorney can help you sort through the different options to assuming the position as Successor Trustee.  He or she can then prepare the necessary documents you’ll need to present to banks, brokers, insurance agents, and others. Ensure that mail will be handled appropriately, and not lost.  Consider having the mail directed to your residence if necessary. Take steps as necessary to preserve the estate.  You’ll want to guard against “beneficiary raids” by securing the property and taking an inventory of items.  Something as simple as walking around with a video camera can be of great assistance.


Remember, when you step in as the agent under a Durable Power of Attorney, or Successor Trustee, you owe a fiduciary duty to the beneficiaries of the trust.  If you breach that duty, you could be held personally liable for any loss that you’ve caused.  Remember, you’re in this position because someone trusted to you carry out their wishes. 

California Tax Tricks for Seniors

California Tax Tricks for Seniors

Looking for property and income tax breaks?  California has a few options for seniors that could keep money in your pocket.

Property Tax Deferrals

While not eliminating property taxes, seniors 62 and older or disabled individuals with an annual household income of $35,500 or less can apply for postponement of property taxes on their home.  Information and the application are posted on the State Controller’s website.

Examine Parcel Taxes

Many cities and counties have additional locally imposed taxes paid by parcel taxes.  The tax is based on the characteristics of the parcel, for example the size of the home or the lot.  However there are exemptions for which you may be eligible.

To find out if you qualify for an exemption, call the local district or agency that imposed the parcel tax or special assessment listed on your annual property tax bill.

Note: An unofficial county-by-county list of some parcel taxes and exemptions is available on the California Tax Foundation website.

Moving? Take Your Property Tax With You

If you plan on buying a new home of equal or lesser value, and are 55 or older, you may be eligible to transfer your current property tax bill to your new home, thereby avoiding paying higher property taxes.  Read a full description about the benefits of Propositions 60 and 90 here.

Disabled Veterans May Qualify for a Property Tax Exemption

If you are a 100% disabled veteran, or an unmarried surviving spouse of one, you may qualify for a property tax exemption of $124,932 to $187,399 on your principal residence.

To learn more, visit the Board of Equalization’s disabled veterans’ exemption webpage.

To apply for the Disabled Veterans’ Exemption, contact your County Assessor.

Sales and Income Tax

for all taxpayers 60 years of age and older The Tax Counseling for the Elderly (TCE) program offers free income tax help.  They specialize in pensions and retirement-related issues.

To locate the nearest TCE site, use the Internal Revenue Service’s site locator tool or call 1-800-906-9887.  Visit the IRS website for more information about TCE.

This year the BOE estimates seniors 65 years or older will save between $109 (single) and $218 (married) when filing their 2015 California income tax returns if they qualify for the Senior Income Tax Exemption Credit.

Another exemption, the Senior Head of Household Credit may save you up to $1,317 if you:

  • Are 65 or older as of January 1, 2016, and
  • Earned $69,902 or less in 2015, and
  • Filed as head of household in either of the previous two years.

There are also a number of items that are exempt from sales tax, like

  • Prescription medications
  • Prescribed medical equipment like wheelchairs, eyeglasses, crutches, canes, and walkers
  • Meals sold to low-income senior by a nonprofit organization or government agency, like Meals on Wheels Association of America
  • Meals served to you on a regular basis if you are 62 or older and live in a condo, and own equal share in a common kitchen facility.

Source: Tax Help for California Seniors, California Board of Equalization


Transferring New Assets Into Your Existing Trust

Transferring New Assets Into Your Existing Trust

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What happens to your trust when you open a new bank account or buy a new home?  Many people worry that a change in their assets will require a trust amendment.  The good news: it doesn’t, but there are two simple things you need to do when you get rid of an asset or acquire a new one.

Keep Your Trust Exhibit Up To Date

Your trust exhibit does two important things: first, it shows your intent to have the trust own those assets, and secondly it tells your successor trustee what you own.  Be nice to your successor trustee and don’t send them on wild goose chases by keeping your exhibit up to date.  Print out a fresh page with a list of your current assets and put it in the back of your original trust.  Make sure the page is dated, both for your reference and anyone coming after you.

Title, Title, Title

Make sure your trust properly holds title to your new asset.  If you’re not sure of the correct way, and even if you think you’re sure, check with your estate planning attorney.  An ounce of prevention here can save thousands of dollars and hours of frustration later. 

What to Keep Out

It’s important to remember that life insurance and retirement plans are controlled by the beneficiary designation.  Retirement plans in particular should not be directed towards your trust unless your trust is specifically designed for retirement funds.  If you send retirement funds into a trust that is not designed to hold that type of asset you could end up triggering the 5 year rule, forcing your beneficiary to pull out all the retirement funds in 5 years. 

So, when you buy that condo in Hawaii or open that new bank account – update your trust exhibit, and make sure your trust holds title to your asset.



For Seniors Downsizing, Props 60 and 90 Offer Relief

For Seniors Downsizing, Props 60 and 90 Offer Relief

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In California, Prop 13 famously keeps your property tax low, making it potentially an expensive move to sell a home you’ve had for years for a new home, which will be taxed at the current fair market value.  But for seniors over 55, Propositions 60 and 90 allow you to take your old home’s tax value with you to your new home.

Proposition 60 lets you buy a new home of equal or lesser value in the same county, and keep your current tax bill.  Proposition 90 lets counties decide if they will accept transfers from another county.  Locally, El Dorado County is the only county that accepts transfers from other counties.  (A complete list of counties allowing property tax transfers in is available here.)  If you buy and sell inside Sacramento County, however, you’ll still be covered by Proposition 60.

In order to qualify for the transfer you’ll need to meet a few key qualifications:

1.     You, or a spouse residing with you, must have been at least 55 years of age when the original property was sold.

2.     The replacement property must be your principal residence and must be eligible for the homeowners’ exemption or disabled veterans’ exemption.

3.     The replacement property must be of equal or lesser “current market value” than the original property. The “equal or lesser” test is applied to the entire replacement property, even if the owner of the original property purchases only a partial interest in the replacement property. Owners of two qualifying original properties may not combine the values of those properties in order to qualify for a Proposition 60 base-year value transfer to a replacement property of greater value than the more valuable of the two original properties.

4.     The replacement property must be purchased or built within two years (before or after) of the sale of the original property.

5.     To receive retroactive relief from the date of transfer, you must file your claim within three years following the purchase date or new construction completion date of the replacement property.

6.     Your original property must have been eligible for the homeowners’ or disabled veterans’ exemption either at the time it was sold or within two years of the purchase or construction of the replacement property.

There are two other “wrinkles” to watch out for.

First, when you sell, the property must be subject to reappraisal unless the buyer qualifies for relief under a disaster or disability exception.  This means that a sale to a child that doesn’t trigger a reappraisal of the new property won’t qualify for the transfer.  Second, this is a one-time benefit, meaning once you transfer your tax basis to the new property, don’t expect to be able to do it again.

For those of you who hold your home in a trust (and if you don’t currently, why not?) as long as you are the present beneficiary of your trust, you will qualify for the transfer.

If you are looking to downsize, see if Propositions 60 and 90 take the property tax worry out of the equation for you.

For more information about Propositions 60 and 90, see the excellent resource on the California Board of Equalizations website here.