For individuals who need the help of a guardian and a conservator, a court may decide to appoint two different people to fill each role or just one person to fulfill both sets of responsibilities. Although the courts tend to consider spouses, adult children, brothers or sisters, and other blood relatives first when deciding whom to appoint as a guardian, any adult without any conflict of interest may apply to become someone’s guardian or conservator. It will be up to the court, however, to make the final decision.
A guardianship of the person is a court-appointed guardian who has been authorized to make decisions for another person (called the ward). Anyone over 18 years of age who suffers from a mental deficiency, mental illness, or any other condition that makes them unable to care for themselves may become a ward in need of a guardian.
A court-appointed guardian may be authorized by the courts to decide a number of matters, such as where the ward will live and what kind of health care he or she may need. The ward will often be an adult who is incapacitated and incapable of making these decisions.
The court appoints a conservator to manage and make decisions regarding another person’s property and financial affairs. Responsibilities may include any or all of the following:
- Opening a bank account for the protected person that will allow the conservator to pay their bills and settle debts
- Posting bond as the new conservator
- Making a list of the protected person’s assets and giving this information to the court
- Accounting for any expenses spent by the conservator on the protected person’s behalf
- Supervising and maintaining the protected person’s assets
- Applying for medical, employment, and government benefits for the protected person
Conservatorships can be set up for both children and incapacitated adults. Entrusting your loved one or his or her estate into someone else’s care is an important matter, and MKPLC can make sure that your case is handled correctly.
The date used for valuation purposes is that of the date of death, although the federal government allows another date to be used. That other date is six months from the date of death, but the date selected for evaluation purposes must be the same for all assets. It is not permitted to use one date for some assets and the alternative date for others. If the alternate date is used, the value of the assets on both the date of death and the alternate date must be reported, so both must be determined.
In addition, if the alternate date is used, then any assets that were sold or distributed before the six month date arrives are valued as of the date of the distribution or sale. Assets whose only change is the date have the same value on both dates. Bank accounts, for example, can have the same value on both dates because the only change in the value of the account is that of additional interest earned in the six months following the date of death.
The only way the alternate valuation date can be used is if it lowers the estate tax total and the amount of estate tax due.
If there is a surviving spouse who is set to inherit the estate, thereby avoiding the estate tax, or if the person who died left less than the amount of the estate tax exemption, then only the date of death can be used to determine the value of the assets.
All of the assets someone owns at the time of his or her death are subject to taxation. These assets include securities, pension and profit-sharing plans, life insurance, IRA accounts, income tax refunds and physical assets such as automobiles, furniture and real estate. Even assets like municipal bonds that are otherwise exempt from federal tax are included in estate tax accounting.
If the person who died was married at the time, only half of the community property and all of his or her separate property is included. Assets held in joint tenancy, or those subject to a beneficiary designation, may avoid probate, but they are still subject to estate taxes. In the case of assets held in joint tenancy, if a claim is made that the surviving joint tenant owned all or part of the assets, the legal representative of the one who died needs to prove the claim. Typically, if an asset is held in joint tenancy, it is presumed that the one who died owned the entire asset.
If the person who died owned only a partial interest in some asset, such as 33 percent of a parcel of real estate, only the partial interest needs to be valued.