Blog Articles

We Help Individuals and Families in the Matters that Matter Most

Why Can’t Doctors Recognize this Form of Dementia?

Considerable’s recent article entitled “The second most common type of dementia often goes unrecognized” reports that in one study, nearly 70% of people diagnosed with Lewy body dementia visited three consultants before receiving the diagnosis. For 33% of people with the disease, getting the correct diagnosis took over two years.

The word “dementia” describes a condition affecting a person’s memory and thinking that is a decline from how they used to function. It is severe enough to affect their daily life. Alzheimer’s disease dementia and Lewy body dementia are the two most common types. Lewy body dementia derives its name from the abnormal protein clumps that are seen on autopsies of the brains of people with Lewy body dementia.

A diagnosis of Lewy body dementia comprises two different conditions: dementia with Lewy bodies and Parkinson’s disease dementia. With Lewy body dementia, an individual develops memory and thinking problems before or at the same time as he or she develops movement problems that mirror Parkinson’s disease. In Parkinson’s disease dementia, one who has experienced Parkinson’s disease movement problems for years then also develops trouble with memory and thinking.

The two conditions have many common features. With the memory and thinking problems and movement problems, patients with these conditions can have fluctuations in their alertness and concentration, hallucinations and paranoia, acting out dreams during sleep (known as “REM sleep behavior disorder”), low blood pressure with standing, daytime sleepiness and depression and other symptoms.

The correct diagnosis is vital for patients and families. The diagnosis of Lewy body dementia is frequently missed, because of lack of awareness by physicians, patients, and their families. Research also reveals that the first diagnosis is commonly incorrect. Roughly 26% of people later diagnosed with Lewy body dementia were first diagnosed with Alzheimer’s disease, and 24% were given a psychiatric diagnosis like depression.

With the correct diagnosis, patients and families can seek out resources, such as the Lewy Body Dementia Association, an organization dedicated to helping people living with this disease. This group provides education on Lewy body dementia, helps patients and families know what to expect, connects patients and families to support and resources and helps them find research opportunities.

Reference: Considerable (Aug. 14, 2020) “The second most common type of dementia often goes unrecognized”

 

The One Part of Biden’s Tax Plan That Could Impact Estate Planning for Most Regular Folks

The tax plan proposed by Vice President Biden would likely have two main effects on estate planning if it is enacted. The first would be a change in the value of an estate that is exempt from federal estate tax. Under President Trump’s 2017 change to the estate tax, the first $11.58 million of any estate (in 2020) is exempt from estate tax. Biden’s plan would potentially reduce this exemption back to the level that existed prior to President Trump’s presidency, which is around $5 million or so. For many Americans, this change probably will not require much, if any, change to their estate plan.

However there is one potential change that has the potential to impact a much larger number of Americans: the change to the rules regarding a ‘step up’ in basis.

Essentially the issue is this. Currently, there are rules in place that give families favorable tax treatment when an asset is inherited that is potentially subject to capital gains tax. This would include assets like a home or stock. Capital gains are the ‘profit’ that you make when you sell such an asset. You then pay tax on those gains. For the most part, we calculate these gains by looking at what it cost to buy the asset, then subtracting that from the sales price. This gives us the ‘gain’ for which we then pay a tax.

But presently the rules are slightly different when you inherit an asset. In that case, we subtract the fair market value on the date of death of the owner from the sales price. This potentially makes the taxable ‘gain’ much smaller, meaning less tax to be paid for the person that inherits it.

Consider the following example. Your grandmother buys 100 shares of stock in 1980 for $5 per share. When you inherit that stock now, the value is $75 per share. If your grandmother were to sell those stocks before she passed, the capital gain would be the sale price minus the purchase price.  ($7500 – $500 = a gain of $7,000). That $500 value is her “basis” in the stock.

However, if you inherit the stock, then under the current rules, your basis wouldn’t be the $500 that she paid for it back in 1980. Rather, it would be the value of the stock on the date she passed (which would be higher than the $500 purchase price). As a result, because your basis is now higher (or ‘stepped up’), the taxable ‘gain’ is much less.

Most regular folks may not have an estate in excess of $11.58 million, or even $5 million. However, the change in the ‘step up in basis’ rule has the potential to impact most Americans right in the assets where they typically hold most of their wealth: their homes and stock holdings.

What Does Pandemic Estate Planning Look Like?

In the pandemic, it’s a good idea to know your affairs are in order. If you already have an estate plan, it may be time to review it with an experienced estate planning attorney, especially if your family’s had a marriage, divorce, remarriage, new children or grandchildren, or other changes in personal or financial circumstances. The Pointe Vedra Recorder’s article entitled “Estate planning during a pandemic: steps to take” explains some of the most commonly used documents in an estate plan:

Will. This basic estate planning document is what you use to state how you want your assets to be distributed after your death. You name an executor to coordinate the distribution and name a guardian to take care of minor children.

Financial power of attorney: This legal document allows you to name an agent with the authority to conduct your financial affairs, if you’re unable. You let them pay your bills, write checks, make deposits and sell or purchase assets.

Living trust: This lets you leave assets to your heirs, without going the probate process. A living trust also gives you considerable flexibility in dispersing your estate. You can instruct your trustee to pass your assets to your beneficiaries immediately upon your death or set up more elaborate directions to distribute the assets over time and in amounts you specify.

Health care proxy: This is also called a health care power of attorney. It is a legal document that designates an individual to act for you, if you become incapacitated. Similar to the financial power of attorney, your agent has the power to speak with your doctors, manage your medical care and make medical decisions for you, if you can’t.

Living will: This is also known as an advance health care directive. It provides information about the types of end-of-life treatment you do or don’t want, if you become terminally ill or permanently unconscious.

These are the basics. However, there may be other things to look at, based on your specific circumstances. Consult with an experienced estate planning attorney about tax issues, titling property correctly and a host of other things that may need to be addressed to take care of your family. Pandemic estate planning may sound morbid in these tough times, but it’s a good time to get this accomplished.

Reference: Pointe Vedra (Beach, FL) Recorder (July 16, 2020) “Estate planning during a pandemic: steps to take”

 

Subscribe