Category: Column

The Gift of Estate Planning

HIPAA Compliance

Many articles have been published about the gift of estate planning. In fact, it is one of the most important gifts you can give to your family and loved ones. A well crafted estate plan represents part of your legacy and how you will be remembered. How you would like to be remembered when you are gone and does your estate plan reflect those wishes?

Why can estate planning be such important gift for your family? Consider these benefits your family receives from your well thought out plan:

1. Protection for your spouse from creditors and predators. Are you leaving a plan which exposes your spouse to risk or protects them?

2. Protection of children from the over indulgence of youth, protection from creditors and protection against predators. Does your plan for your children provide these protections?

3. Inclusion of grandchildren or other family members who are disabled. Such issues should be considered in every plan. Are they addressed i yours?

4. Asset and probate planning. Do your assets create problems and are these issues addressed in your estate plan?

5. HIPAA compliance. Protection of your health information is important in our electronic age. Is your entire plan and all documents HIPAA compliant? If not it needs to be.

6. How recently have your reviewed your plan? Plans older than 5-7 years may create unexpected traps and negative results for your family. Has your plan been reviewed recently?

Does your current plan provide these benefits to your family? Now you know why estate planning is one of the best gifts for your family not only at the holiday season but also year round.

The Importance of Proper Beneficiary Designations

In estate planning, the details matter. In fact they matter so much that the tiniest of details can derail your entire plan. A good example of that is your beneficiary designations.

Family Lawyer Castle Rock

Beneficiary designations can be on things like bank accounts, insurance policies, IRA’s and brokerage accounts. The key question is are your beneficiary designations synchronized with your estate plan? If they are not then your estate plan can fail.

To avoid the inadvertent failure of your plan, work with your estate planning attorney to check each beneficiary designation to ensure coordination with your estate plan.

Protect Yourself and Family from Scams and Fraud

Foreign Hackers

Our firm is located in Castle Rock, Colorado, currently rated as one of the most desirable places to live in the U.S. As our community has grown it has attracted an assortment of scammers, fraudsters and con-artists. Each year we publish an article on the latest tips you can use to protect your family and yourself from getting scammed. Here is our 2019 update on avoiding fraud and cons.

Here are some of the latest frauds to watch out for:

1) Fake families begging at local stores.
2) Fake notices on obtaining recorded documents about real estate.
3) The ever popular robo call now also on your cell phone.
4) Skimming machines at local gas stations.
5) In good weather the always annoying door to door sales person.
6) Internet scams now appearing on your facebook and twitter pages and in the groups you follow there.

There are many more and scammers get bolder and more sophisticated each day. Your job, with these tips is to outsmart the con-artists. Here are several tips to use:

1) Any time and in any place that you feel threatened or uncomfortable, call the police or sheriff’s office. Nothing makes rats run away faster than the cops arriving.

2) If you are unsure about an offer or sales person, check them out before signing anything or giving them money. Use these links to get more detailed tips:

3) Ask your lawyer or CPA for their opinion before you hand your hard earned money over to someone. Your lawyer and CPA owe you what is called “fiduciary care” so they are required to have your interest paramount.

4) As hard as this may be to do, NEVER EVER give money to someone who is begging at the store. If you fail to follow this rule you will probably see that fake family at the car dealer buying their next car with your money!

5) As fun as it is to follow advice on facebook, twitter and nextdoor, don’t buy ANYTHING just because you see it there. I recently purchased a tool for my bike on facebook and, to my total dismay it was a total piece of garbage and I should have known better!

The basis rule in our law is Caveat Emptor. This means that only you can prevent fraud and only you are the best means to protect yourself from scams and con-artists. Remember this: Be careful out there!

3 (Of Many) Reasons Why Estate Planning is Not Only for the Wealthy

Before I became an estate planning attorney, I did not fully understand the importance of having an estate plan.  I thought that estate planning was only for the wealthy.  Nothing can be further from the truth!
So, here are 3 reasons why you should consider meeting with an estate planning attorney, regardless of your wealth:

1. You have children under the age of 18.

A good estate plan protects your children from an uncertain future.  For example, a comprehensive estate plan for families with young children will include an Appointment of Guardian, which allows you to nominate a guardian to care for your children when you die or become incapacitated and are unable to care for them.  They also include an Authorization for Care of Minor Children, which allows you to appoint an another adult to temporarily care for and make decisions on behalf of your minor children when you are on vacation, unavailable, or become incapacitated.

2. To appoint decision makers to take care of you and your finances should you become unable to do so.

Not all estate planning concerns death.  For example, power of attorney documents are important estate planning tools.  These documents allow you to name people you trust (agents) to make medical and financial decisions for you while you alive, but are unable, or don’t want to, make such decisions for yourself.

3. The State in which you live has already created an estate plan for you.

All 50 states, and the District of Columbia, have laws that dictate how your property will be distributed after you die.  These laws are called the laws of intestacy and apply when you die without a will.  These laws may not match how you want your property to be distributed after your death.
Greta Suneson

Is Your Estate Plan HIPAA Compliant?

HIPAA compliance runs through most of our daily lives and activities. Having an estate plan which is HIPAA compliant is now mandatory in order for your wishes to be carried out.

Here are some things to check in your documents:

  • Are the documents dated prior to 2010? Older documents are often not HIPAA Compliant.
  • Do your documents mention HIPAA? If they don’t the documents are not compliant.
  • Are HIPAA Personal Representatives named? If not then the documents are not HIPAA compliant.

HIPAA Compliance

K&G can review your plan documents to ensure effective compliance. Contact our office at 303-688-3535 to schedule an estate plan review meeting today.

K&G Attorney Named 2019 Castle Rock Citizen of the Year

K&G happily announces that the Castle Rock Chamber of Commerce has named K&G partner Bernie Greenberg as the 2019 Castle Rock Citizen of the Year. Bernie’s involvement in the local community is extensive as he has a long list of community service and is the 2019-2020 Chair of the Castle Rock Chamber Foundation, a 501(c)(3) charity which provides public education in business, economics and civics. Congratulations to Bernie Greenberg!

FINANCE: Independent Contractor vs. Employee: Know the Difference

As seen in “Our Colorado News.” Written by John Kokish.

Is your “independent contractor” truly one or is he or she, in reality, an employee? The distinction makes all the difference in the world on how you are treated by the IRS and the state of Colorado.

If he or she is truly an independent contractor, you have no obligation to pay a set salary, withhold his or her taxes, pay your share of his or her social security, pay for his or her workers’ compensation and other state required payments. On the other hand, if he or she is an employee, you are responsible for all of those items.

The IRS distinguishes if he or she is an independent contractor or an employee. Basically, an independent contractor is an independent business person who runs his or her business but does work for another business. An employee is hired by a company to perform specific work at the direction of the employer.

To help distinguish between employees and independent contractors, the IRS has set up three general criteria:

  • Behavioral Control. If the employer trains and directs work, including hours of work, what tools or equipment are to be used, specific tasks to be performed and how the work is to be done, the worker is likely an employee. If the worker can set his or her own hours and works with little or no direction or training, he or she is probably an independent contractor.
  • Financial Control. This factor includes how the worker is paid, if the worker may work for others at the same time and whether the worker can incur a profit or loss. A worker who is paid a salary, is restricted from working for others and does not participate in company profits or losses is probably an employee.
  • Type of Relationship. Even though a contract might specify an “independent contractor”, this factor is not controlling. If the worker is entitled to benefits, this would indicate an employment relationship. Another factor would be the type of work the person does; if it is directly related to the company’s co-work, he or she is probably an employee.

When in doubt, the IRS assumes the worker is an employee. It is sometimes difficult to determine the status of a worker, so if you are unsure as to how to classify him or her, you can file an IRS form SS-8 to request the determination from the IRS.

Remember, an independent contractor is not an employee if he or she does not receive a paycheck and no social security and medicare taxes (self employment taxes) are withheld from his or her payments. Therefore, the independent contractor must pay self employment taxes at the end of the year along with his or her personal tax return.

Colorado goes by different guidelines, which are important for determination of workers’ compensation benefits. If a person is an independent contractor, it must be shown that the person for whom services are performed does not:

  • require the individual to work exclusively for the person for whom the services are performed;
  • establish a standard for the individual;
  • pay the individual a salary or an hourly rate instead of a fixed or contract rate;
  • terminate the work of the service provider during the contract period unless the service provider violates terms of the contract;
  • provide more than minimal training for the individual;
  • provide tools or benefits to the individual, except that materials and equipment may be supplied;
  • dictate the time of performance, except that a completion schedule may be established;
  • pay the service provider personally instead of making checks payable to a trade or business name of the provider; and
  • combine the business operations of a person for whom service is provided in any way with the business operations of the service provider instead of maintaining all such operations separately and distinctly

While these guidelines are specified by statute, the courts often interpret them loosely.

Making the determination can be tricky, because even the courts sometimes look at the guidelines in different ways. It is important for the business owner to at least understand that there is a distinction between an independent contractor and an employee and merely designating someone as an independent contractor to simplify payment to him or her may not work with either the IRS or the state of Colorado. A good rule of thumb is to consult an experienced business attorney.

Home Inspections

 As seen in “Our Colorado News.” Written by John Kokish.

You have just signed a contract to make the largest purchase that you probably will ever  make in your lifetime – – a home.  Not only is it wise to understand the details of the purchase contract, but it is also important to understand potential problems you may be facing in the home itself.  That is what home inspections are all about.  Theoretically, you can inspect a home yourself.  However, when you purchase a home, the average buyer looks for reasons to buy it and not for problems the home might have.  That is why an unbiased home inspector, who will cost you somewhere between $250-$500 depending on the size of the home, is almost mandatory in any home purchase.

In Colorado, home inspectors do not have any licensing requirements.  Most home inspectors enroll in a course that teaches them what to look for.  However, because there is no state test in Colorado, an inspector who graduates from an authorized course can begin inspecting homes right away.  Therefore, you should always inquire how many homes the inspector that you are planning to hire has inspected so that you are not getting a rookie.

It is also important to know that most contracts required by home inspectors in Colorado limit their liability in the event they fail to disclose serious defects.  That means if the inspector fails to notice a serious mold condition that may require up to several thousand dollars worth of remediation, the most you can expect to collect against him in a suit is the amount that you paid him for the inspection.

The main things the inspector will look for in reviewing the condition of the home is the heating system, plumbing, electrical system, and central air conditioning system, as well as the roof, attic, visible insulation, walls, ceilings, floors, windows, doors, foundation, basement, landscaping and visible structure.  Most inspectors will also offer you additional services such as radon testing, water testing and termite inspection, all at an extra but minimal charge.

The standard Colorado real estate purchase contract allows a buyer to require the seller to remedy unsatisfactory conditions, adjust the purchase price or terminate the contract.  In fact, the inspection clause allows the buyer a complete escape from the purchase contract for any reason or no reason at all.  It is one of several escape clauses in the contract that sellers should be aware of when taking their homes off the market.  If a buyer is acting in good faith, he will provide for an early inspection in the contract so that he can exercise the clause early if need be to allow the seller to put the house back on the market. A seller should be wary of buyers who leave the inspection too far down the road, especially in the high selling season.  Responsible real estate brokers representing buyers will call for an early inspection so that their buyer can get an early estimate of what corrections, if any, the home needs.

In any case, a home inspection is a must for a buyer and is even a good idea for an individual that is not selling his or her home to just get an independent opinion if there are any issues  in the home that need immediate correction.

Mold- How it Can Cost You

 As seen in “Our Colorado News.” Written by John Kokish.

Your shower and commode are partitioned off your master bathroom and can be closed off when you are using that area.  You notice some “dirt” or “soot” in the ceiling above the commode, but you are not concerned.  You can wipe it off another day.  Wrong.  It is not dirt or soot; it is mold, and although it is only small, if you do not do something immediately, the mold will continue to spread and create a potentially serious health hazard to you and your family members.

Mold forms in places that either are naturally humid, or where there has been a water problem caused by a leaking roof or pipe.  Some mold may be hidden behind wallpaper, under carpets or in other areas not easily seen.  If not remediated quickly, mold can spread and cause neurological symptoms such as headaches, trouble concentrating, short attention span, memory loss, dizziness, or it can cause or worsen allergies or allergic reactions causing skin irritation, rash, or pulmonary disease.  It can even cause or aggravate life threatening chronic conditions, such as asthma, cancer or hypersensitivity pmenmontis (HP).

A judge in Elbert County suffered severe pulmonary reactions not too long ago which were finally diagnosed as being caused by mold that formed in the Elbert County courthouse.  Ultimately, the mold was remediated, but not before the judge went through a hellish experience fighting the symptoms.

Mold can grow indoors and outdoors, and it more prevalent in localities that have high humidity problems, unlike the dry climate that favors Colorado. Nonetheless, mold does grow in Colorado and is especially prevalent in areas affected by water and structures built with damp or wet building materials.

The Center for Disease Control (“CDC”) does not recommend sampling for mold, since although there are many different types of mold, all of them present a health hazard.  Mold can readily be recognized by a damp or musty smell, and the areas that have been subjected to water leaks and improper drainage will generally have tell-tale water stains and marks that one can be sure either contain mold or will contain mold.  To help prevent the growth of mold, the following steps are recommended:

  • lower indoor humidity with air conditioners, de-humidifiers and exhaust fans
  • inspect hoses and fittings on appliances, sinks and toilets
  • use household cleaners with mold-cleaning ingredients like bleach
  • opt for paints and primers that contain mold inhibitors
  • clean gutters to avoid overflow and check roof for leaks
  • avoid carpet in wet areas like basements and bathrooms

Once discovered, the mold should be remediated quickly.  Depending on how big the mold infestation is, the cost of remediation will vary from several hundreds of dollars to many thousands.  In any case, drying out the affected areas may not be enough; the requirement may be that all affected areas must be removed and replaced.

Mold damage has resulted in some monstrous jury verdicts including $14 million in Florida, $18 million in California and $32 million in Texas.  Some well-known individuals have initiated mold law suits including Michael Jordan, Ed McMahon and Erin Brockovich.

As a result, insurance companies now often have disclaimers for mold damage, so it is important to read the policy to determine if such an exclusion exists.  If it does, the insurance adjuster will generally attempt to deny coverage claiming that the homeowner caused the mold or contributed to its spread by allowing wet areas to fester.  However, if the mold is caused by a sudden and accidental incident, such as a pipe bursting, the cost of remediation probably will be covered by insurance.  The reasoning is that technically the pipe burst and that caused the claim, not the mold itself.  Roughly 22% of all homeowners’ insurance claims result from “water damage” and “freezing”, which includes remediation.

Some insurance companies also offer mold riders to the general homeowners  insurance policies.  However, a mold rider could cost an additional $500 to $1,500 a year on an existing policy, and more in humid climates.  If your insurance carrier refuses to provide a rider because of the increased risk, some casualty companies might sell you a standalone mold policy if you are still concerned.  However, the premiums for a standalone mold policy might range from $5,000 to $25,000, making the cost of the policy disproportionate to the value of your home.

In short, the prevention of mold through safeguarding measures is, in the long run, far less expensive than remediating mold or carrying expensive insurance.  The homeowner must make that choice.