Oral Argument in Same Sex Marriage Cases Scheduled

The Supreme Court has scheduled oral argument for two cases which involve the legality of same-sex marriages.  The arguments will be heard on March 26 in both Hollingsworth v. Perry, a case involving California's Proposition 8, and United States v. Windsor, a New York case involving the constitutionality of the Defense of Marriage Act as it applies to the Federal Estate Tax.

By:  William J. Kovatch, Jr.
(703) 837-8832
info@kovatchelderlaw.com

Help Me Raise Money for the Cub Scouts!

Want to help me do something goofy and raise money for my Cub Scout pack?  Check out this video.  If I receive a total of $500 in donations to the Cub Scout Pack 95 before the annual Blue and Gold Banquet, I will dye my hair a goofy color scheme. Not only that, I will publish photos on the Internet.

I'm not afraid to get goofy in front of my boys for a reason.  And this seems like a good enough reason.

Plus, as an added incentive, you get to choose the color scheme.  The color scheme getting the most donations wins.  You vote with your dollars.  Your choices:  (1) blue and white to represent my high school, J.R. Masterman; (2) orange and green to represent my undergrad school, the University of Miami; (3) red, white and blue to represent my graduate school, The American University; or (4) scarlet and white to represent my law school, Temple University.  But wait, you could go off the board.  My daughter has suggested neon pink and purple.

If you would like to donate, make your checks out to Cub Scout Pack 95.  Mail them to me at: William J. Kovatch, Jr., 2121 Eisenhower Avenue, Suite 200, Alexandria, VA 22314.

Supreme Court to Address Same Sex Marriages

The Supreme Court announced that it would hear two cases which involve same-sex marriages.  One case is from California, and concerns a ban on same sex marriages approved by California voters.  The other is an appeal from the U.S. Court of Appeals for the Second Circuit which held that part of the Defense of Marriage Act was unconstitutional.

The Second Circuit case concerned a lesbian couple who had married in Canada, but lived in New York.  One spouse died, leaving her estate to her surviving spouse.  The surviving spouse claimed the marital deduction against the federal estate tax.  The Second Circuit held that the Defense of Marriage Act, which prohibits the Federal Government from recognizing same-sex marriages, violated the Equal Protection Clause of the U.S. Constitution.

The move by the Court does not necessarily mean that the Court will reach the central issue of whether same-sex marriages should be recognized in the United States.  Nonetheless, a possible outcome of the cases could be the resolution of whether same-sex couples can enjoy the same benefits under federal law as heterosexual couples.

By:  William J. Kovatch, Jr.
(703) 837-8832
info@kovatchelderlaw.com

The Pro Se Guardianship Proceeding

I don't want to sound as if I want to restrict access to our courts.  However, there is a trend, at least here in Fairfax County, Virginia, that has me concerned.  That trend is the rise in number of pro se guardianship petitions, or guardianship petitions that are filed without the help of a lawyer.

I understand the reason these petitions get filed without a lawyer.  Usually, there is a well-intentioned family member who just wants to make sure that an older person who appears more and more confused is getting the help they need.  In many cases, resources are tight, and the family member wants to try to avoid spending a lot of money.

Indeed, guardian petitions are costly.  This is one of the reasons why I warn people that they should put a comprehensive estate plan in place.  If drafted properly, a few dollars spent now can avoid thousands of dollars in expense and hassle down the road.  To properly pursue a guardianship petition, you should expect to pay a lawyer somewhere between $1,500 to $2,500, to pay a court-appointed guardian ad litem somewhere between $1,000 to $2,500, court costs of a little under $100, and additional costs such as doctor's fees, surety fees and other expenses

Even though the petitioners appear to be well-intentioned, and may resent the notion that they have to spend thousands of dollars out of their own pockets to pursue a guardianship case in Virginia, there is a reason for it.  A guardianship petition should never be taken lightly.  First, in Virginia, anyone can file a guardianship petition against anyone else.  If successful, the petitioner will be taking away numerous fundamental rights from the potential ward.  This could include the right to make medical decisions, the right to control your finances, the right to drive, and the right to vote.  Given the seriousness of the matter, courts simply cannot grant guardianship petitions on a whim.  They must be supported by evidence, and the potential ward must be given the meaningful right to contest the proceeding.

Those who file guardianship petitions pro se are often surprised to find out how they work in Virginia.  Before a guardian can be appointed, there must be an evaluation by a licensed health care worker who certifies that the person is incapacitated.  When the guardianship petition is filed a lawyer, called a guardian ad litem, is appointed to provide guidance to the court.  The guardian ad litem is required to investigate the matter, interview all of the relevant players, including family members and doctors, review all relevant information, including medical reports and financial records, and give a report to the court on whether a guardian is necessary.  This takes time.  And, that time gets billed.  Petitioners who choose not to hire their own lawyer are often surprised to find out that Virginia law places the cost of all of this on them.

To be certain, if a guardianship petition is granted, it is possible to get the court to order that the costs associated with the petition be borne by the ward, assuming the ward has sufficient funds.  In some cases, if the ward is indigent, the cost of the guardian ad litem is paid by the Commonwealth.  But, petitioners are taking the risk that all of the expenses will come out of their pocket.

Then, there is the case of the contested guardianship.  In most cases, the guardian is appointed through a simple hearing after the guardian ad litem files the report with the court.  But, if the potential ward objects, then there may need to be a hearing where the rules of evidence apply.  In fact, the potential guardian has the right to insist on a jury trial.  All of this adds to the hassle and expense.  Indeed, a contested guardianship case can cost n the tens of thousands of dollars in lawyer's fee, including the fee of the guardian ad litem.

Filing a guardian petition without a lawyer is also unfair to the guardian ad litem.  The guardian ad litem's role is not to be the layer of the petitioner.  It is to represent the best interests of the potential ward.  Yet, when a guardian petition is filed without a lawyer, inevitably legal requirements, such as the need for a doctor's evaluation, are overlooked.  This places the guardian ad litem in the very uncomfortable position.  Should the guardian ad litem help out the petitioner, and in effect do things that the petitioner's counsel would have done?  Or should the guardian ad litem simply recommend rejecting the petition for failing to meet the legal requirements, and foot the petitioner with a bill for his or her services in doing so.

And all of this is why pursuing a guardianship petition without a lawyer is a very bad idea.  Petitioners need to be forewarned on exactly what the process involves, and how much it can cost.  In the end, hiring a lawyer to guide you through the process will save everyone involved in the process time and expense, while protecting the rights of the potential ward.

By:  William J. Kovatch, Jr.
(703) 837-8832
info@kovatchelderlaw.com

Using Trusts and Powers of Attorney in Your Estate Plan

There are various tools that you can use in your estate plan to make sure that your property is handled the way you want.  Two such tools are the trust and the power of attorney.

A trust is a legal arrangement where one person, a trustee, holds and manages property for the benefit of another person, the beneficiary.  Through a trust agreement, the trustee is given instructions on what to do with the property held in trust.  This includes instructions on what to do with the property once the beneficiary has died.

The most common type of trust used in estate plans is the inter vivos, or living, revocable trust.  The owner of the property appoints himself or herself as both the trustee and the beneficiary.  He or she then appoints a successor trustee to take over when the original trustee dies or becomes incapacitated.  The trust includes instructions on what to do with the property upon the owner's death.

Revocable living trusts are commonly used to avoid probate.  That is, by owning your property through a trust, you do not have to file it with the probate division of the court, and go through the expensive and tedious process of probate.  In Virginia, where every estate with more than $50,000 (exclusive of real estate) must go through probate, using a living trust can save your heirs money and hassle after your death.

But, revocable living trusts can have other purposes.  They include assisting an older person who needs hep managing money by appointing a co-trustee to help make financial decisions. 

A power of attorney is a document that appoints a person to make decisions for you.  You appoint an agent, also known as an attorney-in-fact.  Your agent has the power to act as if her or she were you.  That can make it easier for you to have someone do your banking or sign documents in a real estate transaction.  Of course, since the agent can do things on your behalf, you better make sure your agent is a person you trust to act in your best interests.  Powers of attorney can be limited.  An example is a power of attorney to complete a real estate transaction while you are out of town.  Powers of attorney can also be general.  This is where you appoint an agent to do anything you can do.  They should also be durable, meaning that the powers of attorney is effective even when you are incapacitated.

The most common reason to have a power of attorney is to protect your estate from the need to engage in guardianship proceedings.  That is, if you become incapacitated, and you do not have a power of attorney, then in order for someone to take care of your estate for you, that person would have to go through a guardianship proceeding.  Guardianship proceedings are expensive and can be embarrassing.  By contrast, a power of attorney is usually a fairly simple and inexpensive document to create.

I go into more detail on trusts and powers of attorney in this article.

When you are ready to discuss you estate plan, you should contact a knowledgeable attorney to discuss the options available and the advantages and disadvantages of each option.

By:  William J. Kovatch, Jr.
(703) 837-8832
info@kovatchelderlaw.com

A Family with Young Children Should Have a Comprehensive Protection Plan

If you have young children, you should put together your Comprehensive Family Protection Plan.  A will is simply not enough.  You need to ensure that you have appointed a guardian for your children, should you meet your untimely demise, and given instructions to all of your loved ones on how to proceed.

I go into more detail on exactly what you Comprehensive Family Protection Plan should look like in this article.

Make an appointment now so we can discuss how best to protect your family.

By:  William J. Kovatch, Jr.
(703) 837-8832
info@kovatchelderlaw.com

Social Security and Retiring Overseas

Some people look forward to retirement as an opportunity to live overseas.  It may be a chance to spend some time relaxing on a tropical island in the Caribbean.  Perhaps it is time to open a boutique or restaurant in an exotic location.  Or maybe, retirement is a chance to give back to the community, by performing a service, such as medical care, at low-cost or no charge to people of an impoverished nation.

Whatever the reason, retiring to live overseas may raise a number of legal and financial questions.  Will living overseas affect Social Security benefits? What about working overseas?  Are there tax issues to consider?

For U.S. citizens, the good news is that for the most part, living overseas will not affect your ability to collect Social Security retirement benefits.  Such benefits are contingent on your working for 40 qualifying quarters.  So long as you have those 40 quarters of earnings, and reach the right age, you can collect Social Security retirement benefits.  The payment of benefits to U.S. citizens does not depend on U.S. residency.  You can choose to have those benefits deposited in the United States or to another country, with the exception of Cuba, North Korea, Cambodia, Vietnam or areas that were in the former Soviet Union (other than Armenia, Estonia, Latvia, Lithuania and Russia).

For non-U.S. citizens, otherwise eligible for Social Security benefits, the issue is a little more complicated.  Currently, citizens of List 1 will continue to receive Social Security payments no matter how long they live outside of the United States.  In some other countries, List 2, a citizen may not receive U.S. Social Security benefits if those benefits are based on being a dependent or survivor of the wage earner.  Finally, some countries only permit Social Security payments for the first six months of living outside the United States.  However, if you return to live in the United States for an entire calendar month, payments will resume for another six months when you return to the foreign country. A complete explanation of these rules can be found on the Social Security website, http://www.socialsecurity.gov/pubs/10137.html (“Your Payments While You Are Outside The United States”).

Retiring overseas, therefore, creates some issues with respect to your Social Security benefits.  Before making the decision to retire, you should consult with your financial advisor and your lawyer to see just what impact living and working overseas will have on you and your income.■