If church bonds in default, ask trust to correct value or cash you out
The information in this column is intended to provide a general understanding of the law, not as legal advice. Readers with legal problems, including those whose questions are addressed here, should consult attorneys for advice on their particular circumstances.
Q: We own church bonds in our IRA accounts that are in default. Some pay a greatly reduced amount occasionally. The trust holding these bonds sends a 1099 with a stated market value in excess of fair market value. This higher figure is used to determine our required minimum distributions. What can we do?
A: You should contact the trust which administers the bonds to see if they are willing to lower the stated value so that it accurately reflects actual fair market value.
You might also ask if they would be willing to cash you out of the bonds, or distribute the bonds to you at a fair value, so that they are no longer an asset held in your IRAs, and thus not counted in determining your required minimum distributions.
Q: Is the buyer or the seller of a house responsible for replac- ing a stolen air conditioning unit after the earnest money has been deposited? The closing has not yet taken place.
A: The typical earnest money contract requires the seller to replace the air conditioning unit. If the seller fails to do so, the buyer would likely have the right to terminate the contract and receive the earnest money back, or extend the date of the closing, or accept the property as is with an assignment of insurance proceeds, if any.
Q: I have a Directive to Physicians from 2002, and a Medical Power of Attorney and a HIPAA Release, both from 2005. Are these still legal? Do I need anything else?
A: The Directive to Physicians and the Medical Power of Attorney forms have both changed, but the documents you have should still be fine. There is no statutory form for a HIPAA Release.
Assuming you hired a competent attorney to prepare the documents, they should accomplish your needs. Of course, to know for sure, you may want to meet with an attorney.
As far as other documents are concerned, you should also have a financial Power of Attorney and a Will (or Revocable Trust) to dispose of your property. One or more Transfer on Death Deeds might be a good addition to your estate plan as well.
Q: After we both die, my wife and I would like to leave our home to our two sons without going through probate. Which is cheaper for them, a Transfer on Death Deed or an Affidavit of Heirship?
A: The least expensive for them is clearly the Transfer on Death Deed because they will receive the home automatically, with no fees. The costs would be paid by the two of you beforehand, and that could be minimal if you do it yourselves.
The Affidavit of Heirship is something they would likely have to pay to have prepared filed for them.
Ronald Lipman is an attorney with the Houston law firm of Lipman & Associates. He is board certified in estate planning and probate law by the Texas Board of Legal Specialization. Email questions for this column, 50 words or fewer, to stateyourcase@lipmanpc.com