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Wealth Planning and Preservation Update
Information You Can Trust
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January 2008
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We hope you had an enjoyable holiday season. As
you settle into your post-holiday routine, we have
some important information to bring to your attention.
Read below to learn about easy measures to take to
protect your adult children, reminders for owners of
business entities and gift-givers, and notice of
procedure changes specifically affecting owners of
entities located in Delaware.
We know you will find these pieces interesting and
useful. As always, we welcome your feedback.
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Parents of Over 18-Year-Old Children:
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Don't Be Left in the Dark
When tragedy struck Virginia Tech University last April,
an important planning idea was brought to light. It is of
utmost importance to have Powers of Attorney and
Health Care Surrogate documents in place for your
adult children over the age of 18 such as college
students and family members in their 20s and 30s.
Because the Health Insurance Portability and
Accountability Act (HIPPA) holds hospitals and
physicians to high standards of patient privacy,
medical providers are often unable to provide medical
information to anyone without the authority of the
patient.
Section 1177 of HIPPA imposes harsh penalties on
anyone who violates the law by providing a patient's
individually identifiable health information to another
person. The penalties include steep fines and/or
imprisonment which rise exponentially depending on
the severity and nature of the breach of privacy.
According to Section 1171, "individual identifiable
health information" means any information, including
demographic information collected from an individual,
that:
(A) is created or received by a health care
provider, health plan, employer, or health care
clearinghouse; and
(B) relates to the past, present, or future
physical or mental health or condition of an individual,
the provision of health care to an individual, or the
past, present, or future payment for the provision of
health care to an individual, and:
(i.) identifies the individual; or
(ii.) with respect to which there is a
reasonable basis to believe that the information can
be used to identify the
individual.
Because of these severe penalties, many health care
providers may be unwilling to disclose a patient's
information to anyone, even the patient's parents.
Once a child reaches 18, the natural parents no
longer have authority over their child's financial or
medical decisions. In fact, when distressed parents
and family members of some of the Virginia Tech
students tried to ascertain information about their
children, medical providers were unable to release
any information without the proper release form.
To avoid this troubling possibility, Morris Law Group
recommends preparing Powers of Attorney and
Designations of Health Care Surrogate for your over
18 children designating you and your spouse as their
Attorneys-in-fact and Surrogates to make financial and
health care decisions should they not be able to do so
themselves. In addition, it is prudent to ask them
whether they want to execute a Living Will. Each of our
clients typically executes these documents for
themselves, but we previously did not recommend
these documents for their adult children.
Once your children do their own planning, they will
decided on whether to designate their spouse (if any),
friends or family members as decision makers.
However, a number of years generally go by between
turning 18 and the time that a young adult considers
estate planning issues. That is why we recommend
that you, their parents, offer an alternative to a situation
that otherwise would require court action if the proper
documents were not in place.
If we created your estate planning documents and you
would like to proceed with planning for your children,
please contact our office. If you have another advisor,
share this with him or her and consider proceeding as
well. If an adult child is not comfortable providing a
financial Durable Power of Attorney, we can have the
child sign the document and then hold it in escrow
until the child authorizes its release or a physician
indicates that the child is not capable at that time to
make financial decisions due to medical conditions.
All in all, there is little to lose and much to gain.
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Do You Own an Interest in a Business Entity?
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If so, you are most likely required, based on
Florida statutes and/or your operating documents, to
have an annual meeting every year. It is important that
this requirement be met so that the entity is deemed
by the courts or any taxing authority to be a viable
business entity.
For most entities that Morris Law Group formed, the
annual meeting is to take place in February. Note that
there is a mechanism under Florida law for all of the
owners of an entity to agree to all business of the
entity without actually holding a meeting. If you have
any questions about this, or desire our assistance in
completing the appropriate documentation, please
contact our office.
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Attention Owners of Delaware Entities
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Changes in the Law That You Need to Know
The Delaware Annual Franchise Tax season for the
2007 tax year is underway. Major changes to the law
affecting filing requirements and procedures, as well
as policies, are now in effect for all Delaware
corporations.
Most notably:
- All Delaware Franchise Tax Reports must be filed
electronically (click
here to file your Annual Report Online);
- Failure to provide required Officer and Director
information will result in a void status regardless of
compliance with all other filing requirements and
payment of tax; and
- Tighter controls have been imposed to restrict
public access to reported financial information.
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Did You Make a Gift to Someone in 2007?
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If so, you may be required to file a gift tax return on
or before April 15, 2008. Generally, a gift tax return is
due if you made a gift of any property, whether it be
annuities, cash or an interest in a business entity, to
someone directly or in trust for more than $12,000.
There are additional elections that have to be
considered as well if you made a gift to a trust of
which your grandchildren or their descendants are
beneficiaries. Please contact our office if
you have questions about whether or not you need to
file a gift tax return or if you would like our assistance
in preparing the return.
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Firm News
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- We congratulate Heather Burke, Legal
Assistant to Stuart R. Morris and Tasha K. Dickinson,
on her engagement to Edward Phillips.
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The Greatest Compliment...
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We always appreciate referrals from our satisfied
clients and business partners to friends, family
members or business contacts. We welcome the
opportunity to serve the people you care about. Click
on the blue Forward Email at the bottom of the page
to send this newsletter to someone who will benefit
from our insights.
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Send Us Your Question!
We'd love to hear from you. Click here
Info@Law-Morris.com to submit comments or a
question for an upcoming issue of Wealth Planning
and Preservation Update.
This publication is intended for general information
purposes only. It is not intended to constitute
individual legal advice to any specific client.
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About Morris Law Group
Morris Law Group is an estate, asset protection and
business planning boutique law firm that practices
exclusively in estate and gift tax planning, wills and
trusts, business structuring and succession planning,
asset protection, probate, planning techniques for
highly compensated individuals, and national and
international tax planning. Morris Law Group is
dedicated to helping individuals and families preserve
their wealth for future generations, maximizing
inheritances and minimizing taxes.
Morris Law Group has earned the trust and respect of
its clients by educating them on technical aspects of
the law in an understandable manner, and by
providing the highest level of personal and discreet
service. Morris Law Group proudly offers highly skilled
legal counsel with a keen understanding of individual,
family, and business needs. Morris Law Group has
achieved an AV® Peer Review Rating, the highest
rating afforded, from Martindale-Hubbell. The firm has
five offices strategically located throughout South
Florida in Boca Raton, Aventura, Weston, West Palm
Beach and Wellington to provide convenient service
to clients in Palm Beach, Broward and Dade
counties and from across the country.
Read more about the Morris Law Group attorneys
Morris Law Group
Phone:
561.750.3850 / 800.353.3752
Fax:
561.750.4069
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