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Statistics tell us that less than half of all Americans have a comprehensive estate plan despite understanding the importance of a plan. Even fewer people have included incapacity planning in their estate plan. The reason for this is simple-just as people prefer not to contemplate their own death they also prefer not to think about their own incapacity.
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Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 1
INCAPACITY PLANNING
Why It’s Important and What It Includes
Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 2
While old age related incapacity is certainly a valid concern, the reality
is that you could become incapacitated tomorrow as a result of a tragic
accident or a debilitating illness.
Statistics tell us that less than half of all Americans have a comprehensive estate plan despite
understanding the importance of a plan. Even fewer people have included incapacity planning
in their estate plan. The reason for this is simple-just as people prefer not to contemplate their
own death they also prefer not to think about their own incapacity. Moreover, for those who
do consider the possibility of becoming incapacitated they typically think of it in terms of an
old age related disease such as Alzheimer's, which leads to the belief that creating an
incapacity plan while young isn’t necessary. While old age related incapacity is certainly a valid
concern, the reality is that you could become incapacitated tomorrow as a result of a tragic
accident or a debilitating illness. If that happens, who will make decisions for you? Who will
control your assets and your finances? Who will take care of your children? The bottom line as
that in the absence of an incapacity plan the answers to these questions are unclear.
Incapacity Defined
In the State of Missouri, “incapacity” is defined as follows:
“an incapacitated person is one who is unable by reason of
any physical or mental condition to receive and evaluate
information or to communicate decisions to such an extent
that he [or she] lacks capacity to meet essential
requirements for food, clothing, shelter, safety or other care
such that serious physical injury, illness, or disease is likely
to occur.”
The State of Missouri defines “disabled” as follows:
“unable by reason of any physical or mental condition to receive and evaluate information or
to communicate decisions to such an extent that the person lacks ability to manage his [or her]
financial resources.”
Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 3
What Happens Without an Incapacity Plan?
In the event you become incapacitated as a result of an accident or some other sudden,
unforeseen set of circumstances there are number of areas of your life in which someone will
need to step in and make decisions on your behalf if you have not planned for the possibility of
your incapacity. People often make the mistake of assuming that a spouse, adult child, or
parent will automatically be given the legal right to make important decisions and have the
legal authority to control assets; however, it is not always that simple. In a worst-case scenario
your family and loved ones may end up in a protracted and costly legal battle to determine
who will have control over you and your estate during your incapacity. Eventually, someone
will win the battle and be appointed as your guardian and/or conservator; however, it might
not be the person you would have chosen. A guardian is someone who has the authority to
make personal decisions on your behalf while a conservator is someone with the legal
authority to make decisions relating to your estate assets.
What Decisions Will Need to Be Made?
Although each situation is unique, there are a number of areas of your life in which decisions
will need to be made in the event you become incapacitated, including:
Healthcare – often the most immediate decisions that must be made when someone is
incapacitated relate to healthcare. Will life-sustaining treatment be used? Will artificial
nutrition and hydration be supplied? Decisions like these may need to be made and if
you are unable to make them than someone else must make them for you.
Bills – if you are incapacitated for more than a short period of time someone will need
to pay your bills which will require access to your finances.
Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 4
Assets – if your incapacity lasts for a significant period of time, or is permanent,
decisions relating to your assets will have
to be made. For example, it may become
necessary to sell a home or a vehicle if it
becomes clear that you will no longer be
living in the home or driving the vehicle.
Minor Children – if you have
minor children someone needs to have
the legal authority to take care of your
children immediately upon your
incapacitation. If the other biological
parent is an option than this may not be
an issue; however, for a single parent with an absent or uninvolved parent, this alone
should be reason to create an incapacity plan.
Personal -- There are numerous personal on day-to-day decisions that need to be made
for an incapacitated individual, such as where you will live, what doctor you will treat
with, and who will care for you on a daily basis.
What Can an Incapacity Plan Do?
In short, an incapacity plan allows you to decide ahead of time who will make decisions for you
in the event you become incapacitated. You may also have the ability to make decisions
relating to health care issues for yourself ahead of time to ensure that your wishes are
honored down the road.
Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 5
Common Incapacity Planning Strategies
Just as each comprehensive estate plan is as individual as the person who creates the plan, so
is every incapacity plan. There are, however, a number of strategies and documents that are
commonly used in the creation of an incapacity plan, including:
• Living Will – in Missouri, a Living Will allows you to make a declaration indicating your
desire that your death not be prolonged by the administration of “death-prolonging
procedures.” For a living will to take effect, you must have a “terminal condition”.
• Advanced Directive – an advanced directive in Missouri also allows you to express
healthcare wishes but where a living will is limited in its application an advanced
directive is much more broad, taking effect whenever you become incapacitated. In
addition, an advanced directive allows you to appoint an agent who can make decisions
on your behalf if you are unable to make them.
• Power of Attorney – a power of attorney allows you to appoint an agent to act on your
behalf in legal transactions or to make legal decisions for you. If you make the POA
durable it will survive your incapacity. A POA can be general or limited in nature.
• Revocable Trust – a revocable trust allows you to appoint yourself as the trustee while
naming a spouse, parent, child or other loved one as successor trustee. You may even be
able to create your own conditions under which the successor trustee takes over. You
can then transfer assets into the trust, providing the successor trustee with immediate
control over those assets in the event of your incapacity.
Now that you have a better understanding of what the term “incapacity” means and what
happens if you become incapacitated you should also have gained a better understanding of
why it is important to have an incapacity plan in place.
Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 6
References
Missouri Bar, Living Wills and Other Advanced Directives
Missouri Bar, Guardians and Conservators under Missouri Law
Family Caregiver Alliance, Legal Issues in Planning for Incapacity
Copyright 2013. Purcell and Amen - Attorneys at Law, Your Estate Matters LLC www.yourestatemattes.com 7
Estate Planning and Elder Law Attorneys in St. Louis, MO St. Louis Estate Planning Attorneys: Planning for Your Future Today
Missouri Estate Planning attorneys Purcell and Amen, Attorneys at Law – Your Estate Matters,
LLC. are here to help you with legal issues regarding St. Louis Elder Law, Veterans Aid and
Assistance, Probate, Wills, Trusts, Trust Administration, Powers of Attorney, Health Care
Directives, GBLT, and all things required to establish a proper estate plan for the future of both
you and your loved ones. Our law firm understands the varying dynamics of modern families and
seeks to address these issues in the estate plan so your estate is distributed only to those who you
request, instead of those who may be otherwise legally obliged to it. Estate planning can be a big
project that requires consistent maintenance; however, our professional Estate Planning attorneys
can organize all of the legal paperwork and logistics for you, while offering helpful legal advice
along the way.
Purcell and Amen, Attorneys at Law – Your Estate Matters, LLC. 10805 Sunset Office Dr., Suite #100
St. Louis, MO 63127 Phone: (314) 966-8077
www.YourEstateMattes.com
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