Not long ago essential documents for 18 year olds included a driver’s license and a passport for your semester abroad. Essential documents for young adults now include Health Care Proxies and Living Wills. Colleges often request that these be filed before moving into college housing. This shift reflects a change in legal requirements regarding privacy for all medical patients regardless of age.

Once a child turns 18, you as a parent have no legal right to make medical or treatment decisions without documents that provide explicit authority. Although it seems hard to believe, a hospital or emergency room is not required to notify you if your young adult requires treatment or needs to make complicated medical decisions. It may be difficult for a parent to obtain medical records or even to provide assistance during a medical or emotional crisis.

Essential documents provide you with the authority to act on her behalf in legal, medical and financial areas if your child is sick or hurt. It is particularly important to have authority to act if a child has issues with substance abuse or emotional issues, either of which can impair decisions made by the child regarding medical and legal issues. Rucci Law Group recommends the following four documents be created for 18-year olds:

1. Authorization for Release of Protected Health Information authorizes medical institutions to release medical records to a parent.

2. Durable Power of Attorney allows your child to appoint an agent to handle health, legal and financial responsibilities as needed.

3. Health Care Proxy authorizes someone else to make medical decisions if necessary.

4. Living Will designates end-of-life choices for your child.

Most children will see the creation of these documents as another step toward independence and it is important to treat your child with the respect due a young adult. Helping a child recognize that life is risky and these documents are for her protection may increase cooperation. Additionally, respect your child enough to insist that she read and understand each document. It is especially important that Durable Power of Attorney be agreed upon so that a teenager doesn’t see this as the parents effort to control him or her through college.

Michele Gartland joined Rucci Law Group LLC in early 2015. She practices in the areas of trusts and estates. Michele can be reached at 203-202-9686 or at [email protected].

Rucci Law Group will soon bid farewell to Nancy Baker. After more than 30 years of service to the attorneys and firm Nancy will retire at the end of 2015. She is quick to point out that she won’t be farther away than a phone call and will remain actively involved in the Darien community.

When asked to reflect on how her job has changed over the years, Nancy replied that the biggest changes have been in technology and particularly in the use of the cloud. It has been exciting to work for a firm that embraces technology to make the work more efficient and secure, said Nancy. Besides improving the workflow at RLG, learning new applications and software packages have kept her connected to her young grandchildren. Nancy described receiving a video from her granddaughter detailing the preparations for the first day of school and the joy of participating in these events virtually. I am lucky my job helps me stay current with technology. The benefit is being very involved in my grandchildren’s lives.

Nancy finished our interview with a debate about whether her long history of working with Joe Rucci or the extensive candy on offer in the office was the best part of her career as a paralegal. Her final verdict was that candy can be found at any grocery store but a long and successful working relationship is a rare find indeed. Joe Rucci summarized Nancy’s long contribution to the firm’s success by saying, Beyond her value as a knowledgeable and skilled legal assistant are her personal qualities: her warmth, her friendliness, her excellent relationship with clients and her tireless willingness to go above and beyond to be of help to our firm and its clients.” Rucci Law Group bids Nancy farewell and wishes her every happiness in her retirement.

In the flurry to sign a purchase contract, obtain a loan, and pack your worldly goods into boxes, worrying about recent changes to federal lending disclosure rules may be far from your thoughts. Amy Zabetakis cuts through the fog surrounding the upcoming regulation changes and provides you with just enough information to move forward confidently.

New regulations for home loans change the applicable timelines and are likely to change the timeframe in which a new home purchaser will be able to close on a loan. The new regulations require lenders to deliver to the borrower a Loan Estimate form within three business days after receipt of the borrowers loan application and a Closing Disclosure form not less than three days prior to the closing. In order to prepare these forms, banks are requiring that all costs be transmitted by the borrower’s attorney to the bank not less than ten days prior to closing.

Currently Required:  New Regulations Require:

Good Faith Estimate:  Loan Estimate

Truth in Lending:  Closing Disclosure

HUD-1

What Impact Will This Have on Real Estate Transactions?

While there is no question that these changes will have a large impact on the work that the buyer’s attorney does to get the file ready to close, it is unclear the degree to which the changes will impact the transaction. In order to continue to close loans, buyer’s attorneys will need to use new software and will be subject to additional oversight and review by lenders. It is possible that lenders will begin to limit the attorneys authorized to close loans, which will have an impact on buyer’s ability to choose a single attorney to handle the purchase transaction and the loan closing.

However, the big concern is that these changes will impact timing. As an industry, we are anticipating that the changes will impact our ability to actually close transactions on the closing date listed in the contract. For example, while it may still be theoretically possible to close a purchase and a sale for the same client in one day, chances are high that a delay will occur along the way to prevent both closings from occurring in the same day.

Recommendations:

As Realtors, lenders and attorneys adjust to this new system there are likely to be hiccups and delays. If you are a seller, have a contingency plan in place if the sale does not go through on the closing date in the contract. If you are a buyer, make sure your rate lock extends beyond the closing date to allow for unexpected delays.

Make sure the buyer’s attorney is aware of all transaction costs. Second, be sure to transmit your invoice to the attorneys as early in the process as possible. Buyer’s attorneys must submit all transaction costs to the lender no less than ten days prior to closing and this includes any repair credits, closing adjustments and Realtor commissions.

Finally, try to minimize closing day surprises. For example, if a walk through can be done in advance, take the opportunity. Listing brokers should consider visiting their client’s home a week or so before closing to make sure everything is in working order. It remains to be seen exactly how walk through credits and adjustments will be addressed, but the way the regulations are currently written, any credit for a walk through issue – even one covered by the listing or selling broker could require a new Closing Disclosure.

A Note on Timing

There will not be a sudden change over to the new forms. The rule change is based on the timing of the filing of the loan application. The new rules must be applied and the new forms used for all loans where the loan application was filed on or after October 1, 2015. Therefore, for many months we will still be using the old forms for closings but we are likely to begin seeing the new forms in use prior to the end of the year.

Amy Zabetakis is one of three founding members of Rucci Law Group. LLC. She practices primarily in the areas of real estate, zoning and land use litigation. Amy can be reached at 203-202-9686 or at [email protected].

Nico the Office Dog was rescued from a Trumbull shelter by Joe Rucci and his son Ted. Nico, a mix of black lab, pit bull and shar-pei, loves greeting clients and guests. His areas of expertise include providing a soft shoulder to pet during a crisis, strong collaboration in snacks eaten during working hours and championship sleeping in all sunny spots in the office. Though known to take exception to four-legged company, Nico is the perfect gentleman as official “greeter” of the Rucci Law Group.

Nico describes his approach to work as a combination of understanding a client’s mood and his keen ability to sniff out those who will be generous with snacks. He draws on his vast experience as president of Office Dogs Anonymous to institute best practices and cutting edge technologies in the workplace. Nico is particularly fond of pizza and is always an active participant during staff meetings pizza lunches.

Nico takes his Office Dog responsibilities seriously and is particularly happy when clients stop by with their children since children always pay more attention to him than they do to the rest of the staff.  Stop in to say hello to Nico and meet the rest of the Rucci Law team.

With federal and state tax returns due on April 15, advice on reducing your tax bill pops up in many forms and forums. Advice runs from the serious to the sublime. Rucci Law Group recommends that you take a few moments to think through the legal implications of your tax position.

One little known tax intricacy relates to deducting points paid on a mortgage during refinancing. When you purchase a residence, you are allowed to deduct all the points paid to get your mortgage. If you refinance, the deduction isn’t quite so generous up front. You have to deduct the points over the life of the loan, generally 1/30^th per year. That adds up to $33 per $1000 of points paid. Even though it is rather dull the money adds up and it is worth taking this deduction.

The IRS is happy to recognize your charitable donations with a tax deduction as long as you follow its rules. What most of us don’t realize is that your out-of-pocket expenses for charity work are also deductible. That means things like canned food purchased for a soup kitchen, miles driven to get to a volunteer posting, or money spent on paper to print a newsletter are deductible. You need to keep good records and itemize your deductions to take advantage of this deduction.

Not-so-serious advice certainly makes for more interesting reading, even if it only evokes feelings of gratitude that the advice doesn’t pertain to you this year. But if you found yourself playing jazz incognito in a smoky club in SoHo, there are at least three deductions you should not miss.

The IRS allows you to deduct your clarinet lessons if you can get your dentist to sign off on the lessons as necessary to correct an overbite. If your goal is to be more like Woody Allen, the famous jazz clarinetist and movie director, and less like a beaver, you can learn to play the clarinet and deduct the cost of your lessons.

Deductions for medical expenses require good record keeping and are only allowable if they total more than 10% of your adjusted gross income. Most of us find medical and tax issues to be dull topics with the exception of the deduction allowed for wigs. If you can get your doctor to agree that a wig is necessary for your mental health after losing your hair to a disease, you can deduct the cost of your wig. Sadly, you can’t use this deduction for a wig used to get over an atrocious hair cut.

Finally, any program to help you stop smoking is tax deductible as a medical expense. You can’t include non-prescription items like nicotine patches or gum, but you can’t have everything. If you are moving on from your days of playing jazz clarinet in a smoky bar, the IRS is happy to help you give up cigarettes.

You may be surprised to find that you can’t split your iTunes library or your Kindle books among your heirs just as you would have left record albums or books to kids years ago. Even though the library was acquired at substantial cost, due to licensing agreements it is considered non-transferable even as part of an estate. The days of your son receiving all the Barry Manilow albums and your daughter being saddled with your Lawrence Welk collection are over if you only own your music library in digital form. The only upside to these end-use licensing agreements is that it may eliminate last ditch efforts to settle old scores among siblings if nobody gets anything.

Trusts and Estates law is rapidly evolving to catch up to legal questions surrounding digital legacy and assets after death. Control of digital legacy and disposition of digital assets are issues now working their way through courts on a state-by-state basis.

Digital legacy refers to a person’s on-line presence, generally through social media accounts such as Twitter and Facebook. Social media platforms have begun to add functionality that allow for a person’s heir to close accounts or in the case of Facebook memorialize an account. Simply gaining access to these accounts is often difficult for heirs due to needing passwords and account information.

Digital assets can also include photos, documents, emails and other types of intellectual property. Owners generally have exclusive rights to these assets, often through licensing agreements with the software or website provider. Adding to the complexity, digital assets can include things with more quantifiable monetary value such as PayPal accounts, online businesses, and domain names. As the law continues to change, there may be opportunities to transfer digital assets, such as a video library to a trust, and then name heirs as beneficiaries to the trust.

Planning for transfer of these assets should be included in comprehensive estate planning. In general, this requires making an inventory of accounts, documenting passwords, and then providing this list to your attorney to be included with your will. Fair distribution of digital assets after death requires thoughtful planning. Considering who you want to have these assets and how you want them distributed is important in ensuring that they aren’t lost in the Cloud.

Michele Gartland joined Rucci Law Group LLC in early 2015. She practices in the areas of trusts and estates. Michele can be reached at 203-202-9686 or at [email protected]. 

Rucci Law Group welcomed Michele Gartland as an attorney in the Trusts and Estates practice in January, 2015. Michele Gartland brings experience in corporate and general practice, along with strong ties to the community, a hallmark of the Rucci Law Group.

Michele Gartland describes her approach to law as a combination of legal knowledge, understanding a client’s needs, building a long-term, trusting relationship, and at times some hand holding in the best sense.  Michele added, “Phases of life play an important role, as young couples plan for protection of their children and generating wealth, while later in life couples are looking at how best to transfer wealth intelligently.”

When asked if there is anything she wished people knew about Trusts and Estates law that they don’t generally know, Michele had a practical answer about a typical misconception that can have costly ramifications. Most people focus on the federal exemption from estate tax, which is currently $5.43 million, without realizing that the Connecticut exemption from state estate taxes is substantially lower, at $2 million. Although the initial estate tax rate in Connecticut is 7.2%, it can still result in significant taxes due if not properly planned for. Insight into the intricacies of estate taxes highlights the benefit of working with Michele to avoid unpleasant surprises.

Michele also mentioned a growing trend in estate planning which includes the careful consideration of digital assets. With so much information stored digitally and with so many people having an online presence, more and more people are planning to whom they would like to give access and how they would like these assets managed after their deaths. It is a rapidly evolving area of the law and one that impacts everyone.

In addition to the great team at Rucci Law and the opportunity to truly help people, Michele especially enjoys the extensive coffee selection in the office. When pressed to select a favorite, Michele replied, “Everyone has their own favorite, and we love to share them with our clients.” Stop in to have a cup of excellent coffee with Michele and discuss all your estate planning needs.

Amy Zabetakis, founding member of Rucci Law Group, provided a presentation on legal issues surrounding home purchases to realtors in the New Canaan and Darien offices of Berkshire Hathaway in early 2015. A summary of problems and how to avoid these deal killers was presented.

With the median sales price for a residential property in Darien, CT exceeding $1.5 million, the price of a residential property can far exceed the price of a commercial property in another part of the country or even the state. Problems that might have gone unnoticed or ignored in the past are causing sellers a great deal of anxiety and in the worst cases causing delays, forcing price renegotiations or ending deals after parties have already gone to contract on a sale. Unfortunately for these sellers most of these problems could have been mitigated or avoided entirely if they had been identified earlier in the process.

What Are the Problems?

• Open building permits
• No building permit for legal work
• No building permit for work that violates building code or zoning regulations
• Previously removed or abandoned oil tank
• House or other improvements below the flood elevation

What Can You Do?

When you decide to list your home, you need to be certain either you or your contractor obtained both a permit for the work and a Certificate of Occupancy upon completion for any work that was not purely cosmetic. In particular, many attorneys will read the listing and specifically look for Certificate of Occupancy for anything you choose to describe as new.

Best practice is to check for open permits at the Building Department before you list your property. This will give you time to get any open permits closed out or to obtain a permit. Even if the process is not complete before you go to contract you will have far more time to address the problem than if you wait until the issue shows up on the Buyer’s Municipal Search. If you or a prior owner of your property did work that is in violation of the Building or Zoning Regulations you can work that fact into how you price the property and/or be prepared to offer a credit for those problems.

Another good practice is to check with the fire marshal to confirm that any paperwork on a removed oil tank was properly filed with the fire marshal and that there is no indication of remaining contaminated soil. Full removal paperwork was not routinely filed with the fire marshal until relatively recently, therefore, if the paperwork is incomplete you should check to see if you have more complete paperwork in your own files.

If your property is in the flood zone you should order an up-to-date flood elevation certificate to determine if the house conforms to the flood elevation. It is not enough to state that you do or do not have flood insurance. While flood insurance policies are transferable, buyers must have homeowner’s insurance policies in addition to flood insurance policies. We have discovered that certain insurance companies will not write homeowners insurance policies AT ALL on homes that do not conform to the flood elevation; therefore, buyers are looking for flood elevation certificates before they can begin to shop for homeowners insurance.

At the end of the day, these problemissues shouldn’t be deal stoppers but they can have a big impact on how smoothly transaction goes. You don’t want to find out at the eleventh hour that the closing needs to be delayed or a credit given because of an open building permit that existed before you purchased the property. Similarly, no one wants to hear that a buyer couldn’t get its mortgage because the property is below the flood elevation and the buyer couldn’t get insurance in place. A smooth transaction is one where the problems are identified BEFORE the parties go to contract when they can be neutralized.

Rucci Law Group is pleased to announce that we have been hired to advise the New Canaan Planning and Zoning Commission.

For more details, please read the article at The Daily New Canaan.