March 2019 Articles*

Falco & Associates, P.C.

Life, Death And Less Taxes: Commonwealth
Trying To Keep Citizens From Moving Out Of State

All across the country, individuals spend their time working hard to do their best for their families and protect all they have worked for. Where they live can often dictate HOW they live; as income, property and estate taxes continue to rise, people are left to make tough decisions that sometimes include uprooting to a place more amenable to their means but leaving their loved ones and longtime communities. Lifelong residents are moving to more tax friendly states (i.e.: Florida) to try and make a difference in their overall financial welfare.

As the rise in taxes continues—States are faced with a conundrum: The more residents that leave means a drop in tax revenue—which forces the taxes to be raised more for those that remain. The Commonwealth of Massachusetts sees the Catch-22 and is trying to do something about it.

In January of 2019, legislation was brought forward to lessen the amount of people leaving the Bay State for the Sunshine State. “An Act To Mitigate Snowbird Relocation” (House Bill SD.2149; accompanying Senate bill No. 1631) would increase the Estate Tax exemption to $2million per person; $4million per married couple. This is all well and good—and, if passed, wouldn’t be effective until someone passes after December 31, 2020—but, what does it mean to you?

It means the time to prepare is now: Are the assets you have protected? How does the “Snowbird” bill affect you and all you have worked for?

It’s never too early, or too late, to create a plan.

Falco & Associates, P.C.

Luke Perry Protected His Family
With Estate Planning

When Luke Perry, whose full name was Coy Luther Perry III, died on March 4, 2019, he was surrounded by family and loved ones. Tragically, the actor -- who rose to fame playing a teenage heart-throb on Beverly Hills 90210 -- died from a condition that almost everyone thinks of as one that only strikes "old" people. Fortunately, Perry's foresight to do the proper estate planning meant that the tragedy was not made worse for his family.

At the young age of 52, Perry suffered a serious stroke and was hospitalized under heavy sedation. Five days later, his family made the decision to remove life support, after it was apparent that he would not recover, following a reported second stroke. He was surrounded by his children, 21-year-old Jack and 18-year-old Sophie, along with his fiancé, ex-wife, mother, and siblings, among others.

The decision to allow Perry to die - when he was healthy and vibrant less than a week earlier - must have been difficult. The fact that the hospital allowed Perry's family to end life support means that Luke Perry likely had executed the proper legal documents so that his family could make the decision. Specifically, in California, those wishes generally are made in writing, through an Advance Directive or a Power of Attorney. Without a proper legal document, Luke Perry's family may have needed an order from a probate court to terminate life support, at least if family members disagreed. That would have been a public and emotional process that would have prolonged his suffering and made it even harder for his family.

In 2015, Perry reportedly created a will, leaving everything to his two children. Starting that year, Perry became an outspoken advocate for screening for colorectal cancer. He discovered he had precancerous growths following a colonoscopy and began urging others to do the same testing. According to a family friend, it was because of this scare that Perry created a will to protect his children.

Given that Luke Perry had a reported (but unverified) net worth of around $10 million, it is likely that he created a revocable living trust in addition to a simple will. If he had only a will, then his estate will have to pass through probate court. Instead, if Perry had a trust -- which is far more likely -- and if his trust was properly funded (meaning that he transferred his assets into his trust prior to death), then his assets can pass onto his children without court intervention. Hopefully, Perry had the same foresight for his assets as he apparently did with his end-of-life documentation.

The one potential unresolved question is whether Luke Perry would have wanted something to go to his fiancé, therapist Wendy Madison Bauer. Since his reported will was done in 2015, Perry likely did not include Bauer at the time. If the couple had gotten married prior to his death, then Bauer would typically have received rights as a "pretermitted spouse." These rights would not have been automatic, but instead would have depended on the wording of his will and/or trust, as well as whether or not the couple signed a prenuptial agreement that addressed inheritance rights. But, if the documents did not indicate an intent to exclude Bauer as a beneficiary, then she would have been entitled to one-third of his estate under California law if they had been married.

Because Perry died before marriage, Bauer is not entitled to inherit anything through his will or trust. This is assuming the report that his children are his only beneficiaries is accurate and no later will, trust, or amendment is found that includes Bauer. And it is still possible that Perry left money for Bauer in other ways, such as through a joint bank account or life insurance.

Luke Perry's tragic death provides an important lesson for everyone. No one should wait until they are "old" to do their estate planning. Perry's cancer scare in 2015 sparked him to take action, which simplified the process for his family to terminate life support and will likely make the process of dividing his estate easier. Perry certainly did not expect to die at age 52, but -- at least legally -- he was prepared for it.

And as Luke Perry's situation demonstrates, it's not just cancer that people need to be worried about. With the sudden and shocking nature of Perry's death, awareness is being raised about the dangers of strokes in everyone, including those who are middle-aged instead of elderly. The New York Times published two insightful articles about the dangers of strokes in those even younger than age 50. Surprisingly, ten percent of all stroke victims have not yet reached their fifties. And while very few people around that age die immediately from strokes, the length and quality of life after suffering a stroke is greatly impacted, even in those as young as Perry.

Hopefully Luke Perry's death can raise awareness not only of stroke prevention and the importance of colorectal screening, but also serve as a reminder that everyone should follow his lead and not procrastinate when it comes to estate planning. Luke Perry reminds us that tragedy can strike anyone and if that happens, we all want our loved ones to be protected.

By: Danielle and Andy Mayoras, forbes.com

Sign up to get news, newsletters, and updates delivered to your inbox!

Email: (required)

By submitting this form, you are granting, Falco & Associates, P.C., permission to email you.

Initial Consultations
Are At No Cost

Contact

Anthony S. Falco, Esq.
Ronald R. Kearns, R.N., Esq
Kevin Spitz, Esq.
Paul E. Thornhill, Esq.
Patricia G. Novak, Esq.
Anastashia C. Kamberidis, Esq.
Judith M. Flynn, Esq.
Victoria LaBate, Esq.

Learn More

CEU Presentations
For Professionals

Learn More

Getting Started Booklet Courtesy of Senior
Resource Center, Inc.

Learn More

Falco & Associates, P.C. is  afFiliated with Senior Resource Center, Inc., an ancillary care management and Financial overview business. www.helpingelders.com