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Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 4046
Experience:  Extensive Experience with Tax, Financial & Estate Issues
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I am the POA properly registered and filed with local government

Resolved Question:

I am the POA properly registered and filed with local government and brokerage firm that my mother uses. She is no longer mentally capable of making financial decisions but her Dr will not put it in writing. Her attorney is aware of this. Her stockbroker is aware of this.

Her boyfriend is telling her that we are trying to get her institutionalized which is untrue. She believes him and he has moved in with her. He has cancelled her Dr appointments and is moving her over to his Dr. He took her to his attorney 10/11, not to the attorney she has used for the last 15 years. It appears that he is trying to get POA and have her revocable trust changed.

We are afraid he will clean her out and disappear. This money is for her long term health care needs. Nursing homes are very expensive and she refuses to live with us.

There is approximately 325000.00 in stocks and 160000 in annuities and 20000.00 in bank accounts.

How can I as POA protect her money from this goldigger?
Submitted: 11 months ago.
Category: Tax
Expert:  Stephen G. replied 11 months ago.

Stephen G. :

Hello, my name isXXXXX & I'll be helping you today. My goal is to give you a complete & accurate answer that you can understand.

Stephen G. :

How old is your POA & is it what we call a "Durable Power of Attorney" if you know?

Customer:

hello

Customer:

Durable POA was created in 2008 or 2009 by my mothers attorney. It was registered with county government 2 months ago at her attorneys instruction.

Stephen G. :

Well, the only thing you can do is establish new accounts using your POA that your mother & her new friend don't know about. If she creates a new POA giving it to her new friend and cancels your POA, the only recourse you will have is to go to Court to challenge that POA on the basis of the fact that she was not competent at the time she executed the new POA. This will get very messy & costly before it is over.

Customer:

Yes, I am prepared to move the money but want to limit/avoid tax consequences.

Stephen G. :

I suggest that you immediately meet with her attorney and get his advice before you do anything; it may be under FL law you can establish a trust for her with you as the trustee for her benefit;

Stephen G. :

There shouldn't be tax consequences as long as you don't sell anything, but merely transfer it out of the accounts that she & her friend know about; but again, you need to discuss the specifics with your mother's attorney before you do anything;

Customer:

I called her and left urgent message with receptionist Friday morning and did not receive a call back. My wife and son flew to FL last night to try to buy a little time to get the funds moved. Can the stocks that are in a trust account be duplicated into another account to get a new # XXXXX he will not be able to find without taxes?

Stephen G. :

That's to protect yourself' you would want to use your address for everything so the statements don't go to your mother;

Stephen G. :

Is there a living trust in existence now?

Customer:

What I have read about duplicating an account is that all info must remain exactly the same but I can change address after account moved.

Stephen G. :

Not necessarily, is the account in your mother's name or is there an existing trust?

Customer:

Stock account is titled Richardson & McDonald Trust Alice J McDonald TTEE U/A DTD 10/05/1995. Mr Richardson is deceased. Alice is my mother and I am her only child.

Stephen G. :

Are you the successor trustee and can you take over if she is unable or unwilling to serve?

Stephen G. :

Your POA would not normally cover the trust assets.

Customer:

There is a revocable living trust that was created in 1995 and restated 2010 that names me as almost sole beneficiary. Boyfriend has made mention that he knows it is revocable. Alice's attorney who made this trust is aware of her mental condition and that is why he is taking her to a different attorney.

Customer:

Yes, I am listed as successor trustee

Stephen G. :

In case of incompetence?

Stephen G. :

You are going to have a problem unless you follow the terms of the trust for determining her competence. Normally, that will be spelled out in the trust and usually that takes a doctor's detemrination.

Stephen G. :

being the beneficiary is of no value as long as she is alive;

Customer:

Yes, her attorney asked me to get a letter from her Dr. Dr refused even though Dr told Alice she needed to be in assisted living. Alice refused to listen to Dr and is in denial. Boyfriend isolating her from family , old Dr and her attorney.

Stephen G. :

What's the problem with her doctor? If you explain that she is about to be ripped off will he change his mind. If something happens to her money and a judge determines that his failure to act constitutes malpractice, he could be in worse trouble; her attorney may need to write him a letter; has he seen her recently (the doctor)?

Stephen G. :

Assisted Living doesn't equal incompetency? What is her diagnosis?

Customer:

At Alice's attorneys request, I flew to Florida to take Alice to her Dr on 9/27. Dr let me record her telling Alice she was not to live alone but refused to write letter saying that it was a family matter and she would not get involved. Now the boyfriend has severed Alice's contact with that Dr.

Customer:

Alice has dementia and early? Alzheimers. She cannot remember important details for 5 minutes.

Stephen G. :

Perhaps you'll need to bring a copy of the living trust and the POA to your own attorney & figure out what specific options you have - or meet with her attorney if that is possible; whatever is done, needs to be done quickly or your mother's competence will eventually have to be determine by the Court; that will get very expensive with lawyers, etc., before you are through;

Customer:

What are the tax consequences of moving the 325000.00 temporarily to shield it until all is settled?

Stephen G. :

You'll need to follow the terms of the trust if you want to take over as Trustee; otherwise, it's only a matter of time before you have the same problem all over again.

Stephen G. :

Moving it where under what authority?

Customer:

That is what I am asking you

Stephen G. :

As I stated, as POA unless it & the trust provide otherwise, would not give YOU the authority to do anything with trust assets. I can't tell you what the tax consequences of anything are unless you tell me what you are thinking of doing. You can't sell anything without tax consequences if that's what you are asking?

Customer:

goodbye, it was worth a shot

Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 4046
Experience: Extensive Experience with Tax, Financial & Estate Issues
Stephen G. and 9 other Tax Specialists are ready to help you

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