Happy New Year and welcome to 2019!
Enough merriment already. It’s time to get off your arse and get some things done.
- First up, put away the holiday decorations. If your stripped-down home leaves you depressed, then buy some Valentine’s Day stuff and scatter it about. Target, Amazon, and Hallmark are anxious to be of help.
- Second, start the exercise and diet routines. Try a change-up from last year and stick to the plan for more than a week. We’re talking bragging rights, people!
- Third, and maybe you want to move this to first and get it done before you kill yourself taking down decorations and exercising, get your planning documents done/updated. For your lifetime needs, you should have a Durable Financial Power of Attorney, a Medical Power of Attorney, a Directive to Physicians, a HIPAA release, and a Designation of Guardian. For immediate action upon your demise, you need a Designation of Agent for Burial and Burial Instructions.
- For handling your estate after you die, you need a will. You may want to overlay the financial part with an Inter Vivos Trust or throw in a Transfer on Death Deed or Lady Bird Deed. Go see a reputable estate planning attorney and, for goodness sakes, stay away from those free dinner seminars and internet forms.
- Fourth, organize and throw away.
For pictures, put them in order by date or topic, pop them into labeled photo boxes or albums, and scan the important ones. Shred or toss the pictures you would be embarrassed to show people.
For tax records, think 3 years, 7 years and forever.
Keep records 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later. You need to keep records for 3 years after you have disposed of the asset or resolved a debt, such as real estate closing documents, promissory notes, and security agreements.
Keep related records for at least 7 years, just in case you file a claim for a loss from worthless securities or bad debt deduction. Some documents should be kept forever: marriage certificate, birth certificate, death certificate of spouse or child, and the like.
When in doubt, talk to your CPA or check the IRS website.
For collectibles, valuables and treasured keepsakes: make a list and take pictures. Determine what will happen to them if you become incapacitated – do you want them stored, sold or distributed? Leave written instructions with the agent under your Durable Power of Attorney. Make a second determination about what you want to happen to them when you die. This instruction should be in your will, contained in a written memorandum referenced in your will, or detailed in your trust, as appropriate.
For books, magazines, and newspapers: read them, put them on treasured keepsakes list, gift, sell or throw away.
For everything else: keep if you use, donate, sell or toss if you do not.
Simple? Yes. Easy? No. Necessary? Absolutely.
Virginia Hammerle, with Hammerle Finley Law Firm, is board certified in Civil Trial Law by the Texas Board of Legal Specialization. See hammerle.com for her blog and newsletter sign-up. This column does not constitute legal advice.