2015 Annual Newsletter
Office Happenings
The Heartfelt Legacy Foundation
We, at the Law Offices of Stephen B. Yim, are committed to serving our community, so on September 8, 2014, our office created a public charity called the Heartfelt Legacy Foundation. The foundation’s main purposes are to: (1) provide information to families with children with disabilities by hosting annual seminars and workshops with nationally recognized speakers who specialize in Special Needs Planning; and (2) to implement a process called Respecting Choices® in Hawaii. Respecting Choices® in a nationally recognized process that helps families make, honor, and respect end of life decisions.
Going Paperless
We have decided as an office, to reduce the amount of unnecessary papers and files. Many reasons have led us to this decision, including: (1) the cost of storing files; and (2) the security risk of maintaining physical files of personal information.
We will no longer be maintaining any paper documents (either originals or copies). May we strongly suggest that you review your estate plan and keep your documents in a safe and secure place. Please notify our office if you cannot locate your original estate plan.
Staff Updates
Last year, Jennifer Morgado joined us as our Administrative Assistant as Marie Yempuku left us to attend law school in Utah. Jennifer is currently attending the ABA approved paralegal program at the Kapiolani Community College, which is part of the University of Hawaii Systems.
Our office manager, Monica Yempuku will be returning to school this fall in pursuit of her law degree at the University of Hawaii, Richardson School of Law.
Britta Bourne has taken on a fundamental role in coordinating efforts in bringing Respecting Choices to Hawaii. She is also currently enrolled in the Advance Care Planning course to become a certified administrator of Advance Care Planning.
Periodic Reviews
Periodic reviews are an essential part of estate planning as everything changes — laws, policies, our ideas, and even family relationships. Reviewing your estate plan from time to time gives us the opportunity to accommodate these changes. My responsibility as your attorney, is to help you communicate your intentions clearly at a time when you can no longer speak for yourself.
Try to think about a conversation you had recently where a misunderstanding resulted, and where clarification was necessary. Now, try to imagine how that conversation would have turned out if you weren’t there to clear up the misunderstanding. This is the reason why it’s so important for us to use every means of communication available to us to clearly pass on your intentions. This includes: (1) preparing the legal documents such as a trust and powers of attorney; (2) providing each client with our Heartfelt Will, a booklet where they write their intentions down in their own words and handwriting — like an operating manual for their estate plan; and (3) meeting together with their family (and where appropriate, their professional advisors) to help relay their clear intention and instruction.
Discounted Powers of Attorney for Your Children Heading Off to College
Last June we ran a special for those of you whose children were heading off to college — whether mainland or local college — for discounted Powers of Attorney. We will be running a similar special this year. From June to August, we will prepare a Statutory Durable Power of Attorney and an Advance Health Care Directive for your children for a fee of $395 plus the General Excise Tax. Usually our fee is $500 per a Power of Attorney, but for the month of June we will discount the fee to $395 for both, a savings of $605.
If you are wondering whether or not your child needs powers of attorney, you should know that once an individual reaches the age of majority, which is 18 in most states, their parents are no longer entitled to see their child’s medical and financial records, nor are they able to make decisions on their behalf. Once an individual reaches 18, the law classifies them as adults with legal rights to privacy and to govern their own lives. If the unspeakable does happen, and you receive a call informing you that your child is in the hospital unconscious, or in trouble, or in need of your help, a Statutory Durable Power of Attorney and an Advance Health Care Directive can make handling the crisis much easier.
If you would be interesting in finding out more about our Powers of Attorney Special, please contact our office for more information (808) 524-0251.
The Big Three Law Changes
It seems that good things always come in 3’s. This has been my experience in the new laws that have occurred for us as it relates to estate planning. These significant law changes include the New Statutory Power of Attorney, the Estate Tax Exemption increase, and our new Statutory Creditor-Protection law for real estate.
The New Statutory Power of Attorney
This new Hawaii Statutory Power of Attorney (SPOA) was signed into law in April of 2014. The law came about as a result of many financial institutions refusing to accept a legal Durable Power of Attorney. The purpose and intention of the power of attorney is to keep financial matters running smoothly during periods of incapacity, and financial institutions not honoring these powers during these times can cause considerable stress for families.
The State of Hawaii prepared this new SPOA, which every financial institution must accept, in order to help families keep their finances running during periods of incapacity.
We have developed this new SPOA for our clients, and we encourage each of you to contact our office so that we can assist you in making this new SPOA.
The Estate Tax Exemption
The estate tax exemption is now $5.43 million per an individual, up from $5.34 million last year. This increase reinforces the need to shift tax planning from estate tax planning to capital-gains tax planning. President Obama, in January of this year, suggested that we increase the capital gains tax rate from 15% to 28%.
If you haven’t yet taken time to explore the possibility of eliminating capital gains tax for your children through the Joint Legacy Trust, we encourage you to come in for a review meeting to discuss this in detail. In short, the Joint Legacy Trust can eliminate the potential for capital gains tax to your children should they sell real estate or other appreciated assets at your passing, making the entire estate tax-free to the children (other than qualified retired assets like an IRA). It can also simplify your plan and clearly reflect your intentions.
The New Creditor
The New Creditor—Protection Deed
In 2012, the State of Hawaii became one of two states that allows you to hold property in Trust and maintain creditor-protection if one spouse gets sued. Just driving on Hawaii roads these days, with pedestrians, moped riders, bicycle riders, motorcyclists, people on their cellphones, the narrowing of lanes, the building of bike paths, and the fact that most of us are amateur drivers, makes for a stressful experience. If we make a mistake and hit one of these pedestrians, moped riders, bicycle riders, motorcyclists; we can protect our real estate from an overzealous attorney who would like to capitalize on our mistake.
MAHALO!
Please allow us to express our gratitude to you for allowing us to assist you with your estate planning needs. As a continued service to you, we hope you find the information above informative. We encourage you to continue to periodically meet with us to review your plan. We hope to see you soon.