The Law Office of Geoffrey J. Lorenz, LLC

The Importance of Advance Directives

admin — Thu, 31 Mar 2016 00:45:00 +0000

Often when people think of estate planning they are focused on the disposition of their assets and minimizing tax implication. However, advance directives are a very important component of any estate plan and they are relevant for every person regardless of their wealth. Advance directives are legal instructions that express your wishes regarding your financial and health care decisions. If an individual has not previously executed advance directives and can no longer make decisions for themselves due to an accident, illness, or mental affliction, legal proceedings in court to appoint a guardian for the individual will likely be necessary. An individual’s family members are not automatically authorized to make decisions for incapacitated family members because Wisconsin is not a “next of kin” or “family consent” state. Guardianship proceedings are exceedingly more lengthy, costly, stressful and public then advance directives.

In Wisconsin there are four different advance directives authorized by statute. The first is the Power of Attorney for Finance and Property. This document grants authority to another person, known as an “agent,” to make legal and financial decisions on your behalf. The powers granted can be broad or limited in scope. Your agent can assist you with your personal finances, insurance policies, government benefits, estate plan, taxes, bank accounts, retirement plans, business interests and essentially any other financial matter.

The second and third advance directives in Wisconsin are the Power of Attorney for Health Care and Declaration to Physicians (a/k/a Living Will). These documents both deal with health care decisions, although the Declaration to Physicians is much more limited in scope. A Power of Attorney for Health Care allows you to appoint an agent to make any health care decisions on your behalf in the event of incapacity. A Declaration to Physicians allows you to only state your preferences regarding receiving or withholding life-sustaining medical treatment if you have a terminal condition or are in a persistent vegetative state.

The final advance directive available in Wisconsin is the Authorization for Final Disposition. The Authorization for Final Disposition allows an individual, known as the “declarant,” to designate and individual to make funeral arrangements upon the declarant’s death. Further, it also allows the declarant to detail their preferences and desires regarding their final disposition and funeral service.

As indicated, advance directives are relatively inexpensive and easy to implement, especially in comparison to the procedure necessary if an individual does not have such documents in place. As with all estate planning issues, it is important to discuss the impact of advance directives with a knowledgeable attorney.

Benefits of Rental Property Being Placed into an LLC

admin — Tue, 29 Mar 2016 00:52:24 +0000

Legal Benefits

The primary reason to form an LLC is for the legal protection it offers. If the owner has a personal creditor, the creditor generally cannot make a claim on the property owned by the LLC or other corporate entity. Should any tenants, their guests, or anyone on the property sustain any injuries, and if the property is owned in the client’s name, the owner’s personal assets are at risk. Example: An owner has a rental property that is occupied by a young couple. They have a holiday party and one of their guests falls down stairs and is hospitalized. The guest sues the owner for his injuries, stating the stairs were hazardous. If the guest successfully wins the claim against the owner, any judgment in excess of the liability insurance can be satisfied with the owner’s personal assets because they are exposed.

Tax Benefits

From a tax perspective, an LLC formed with two or more members is classified as a “pass-through” company. A “Pass-through” means its income is passed through to its owners and claimed on those owners’ individual tax returns. Hence, it is subject only to capital gains rates on the ownership shares of the member, and not to corporate capital gains taxes, therefore there is no double taxation. LLCs with just one owner-member, however, are taxed as a sole proprietorship and no separate tax return is required. Actual tax dollars saved from holding real estate in an LLC opposed to personally holding the properties is zero.

Estate Planning Benefits

The formation of a LLC for the purpose of holding investment real estate has estate planning advantages as well. It allows for the transfer of ownership in the property in a more seamless manner than if personally owned. In many circumstances property owners wish to gift certain percentages of their real estate to children or other family members. For real estate not held in an LLC this process can require many trips to the county courthouse to update deeds that will require changes every time percentages of ownership change. In cases where real estate is owned in an LLC, the owner-members can simply issue membership certificates to the child or family member and no changes need be made to the deed with the county.

Whether you own twenty properties or one, owning them personally can be a major liability. All of your hard work and planning that lead to the ability to own real estate could be wiped out with one misfortune. Hopefully the insight provided in this article has helped you better understand the benefits of forming an LLC and provided you with perspective on the pros and cons of ownership structures when purchasing property for investment purposes.

Disclaimer: The above information is provided as general information, not as legal advice, and does not create an attorney-client relationship. Before making any decisions regarding legal matters, individuals should consult with a qualified attorney.

Mandatory E-filing starting July 2016

admin — Fri, 25 Mar 2016 00:53:08 +0000

Wisconsin Supreme Court adopts mandatory e-filing for circuit court cases. This will have a major impact on everyone involved in the system. Read to learn more…

http://www.wisbar.org/NewsPublications/Pages/Gener…

Landlord/Tenant Questions

admin — Tue, 22 Dec 2015 01:54:32 +0000

Q: When do I need a written lease?

A lease is a contract that defines the rights and responsibilities of both the landlord and the tenant. A lease can be oral or written. If a lease is for one year or less, an oral lease can be as binding on both parties as a written lease. But the terms of an oral lease may be difficult to prove. A written lease helps avoid misunderstandings between the landlord and the tenant.

A lease for longer than one year must be in writing to be enforceable on both parties. A written lease must provide certain information and contain provisions set forth in the state statutes. It is equally important to avoid provisions that are prohibited by statute. For, if the lease contains prohibited language, the entire lease is void.

Whether a lease is oral or written, the landlord must give the tenant, in writing, the names and addresses of the premises’ owner(s) and authorized agents, such as a building manager. There is one exception to this disclosure requirement. If the owner occupies the premises – and the premises have four or fewer dwelling units – no such written disclosure is required.

Q: When can a landlord refuse to return a security deposit?

The landlord has a right to withhold a security deposit for any of several reasons, such as if the tenant: damaged the premises beyond ordinary wear and tear; caused waste or neglect of the premises (such as leaving hot water running for days); didn’t pay rent; didn’t pay for utility services, whether the landlord provided these or the tenant paid the utility companies directly; or didn’t pay mobile home parking fees that the local government assessed against the tenant.

By law, the landlord must give reasons in writing for refusing to return all or part of the security deposit. State law requires the landlord to provide this information within 21 days of the tenant vacating. The tenant must provide the landlord with his or her new address.

Q: What action can a tenant take if a landlord withholds the security deposit?

Say that 21 days go by since the tenant vacated the premises, and the landlord still hasn’t returned the security deposit or provided reasons for withholding all or part of the deposit. Then the tenant can take the landlord to small claims court. Important to note – the tenant can ask the court to double the security deposit amount, as a penalty for not meeting the 21-day time limit.

The landlord may provide, within the 21-day time frame, written reasons for withholding all or part of the security deposit. But the tenant may disagree with the landlord’s decision. Here, too, the tenant can take the landlord to small claims court to try and recover the deposit. The court may decide the landlord owes the tenant money. However, unlike the example mentioned above, unless the court determines that the landlord falsified or misrepresented its damages, the court won’t require the landlord to pay double the security deposit. If the court decides that the landlord improperly withheld all or a portion of the security deposit, the court may award a tenant who has retained an attorney the reasonable cost of the attorney’s fees and services.

Disclaimer: The above information is provided as general information, not as legal advice, and does not create an attorney client relationship. Before making any decisions regarding legal matters, individuals should consult with a qualified attorney.

Considering a Prenup?

admin — Wed, 02 Dec 2015 01:55:06 +0000

Wisconsin prenup agreements allow spouses to avoid Wisconsin’s marital property rules upon filing for divorce or separation. Wisconsin law says that each spouse owns one-half of all marital property. However, what is considered “marital property” during a marriage is different at divorce. The definition for divorce is far broader, even covering property titled to only one spouse, or property owned before the marriage. If you wish to protect assets from equal division at divorce, you should strongly consider a Wisconsin prenup.

This is particularly true for spouses marrying late in life, or who received valuable gifts or inheritances. A Wisconsin prenup also sets expectations for each spouse’s financial contributions during the marriage. The agreement should be drafted far before the wedding. Both spouses should be aware of each other’s assets, and the effect on their rights. A poorly-drafted Wisconsin prenup has a greater chance of being dismissed. The standards to uphold a Wisconsin prenup are rather strict, so you should consult with a qualified lawyer to ensure proper drafting.

A prenuptial agreement does force you, as a couple, to talk about very important topics beforehand. The agreement itself is designed to protect both parties throughout the marriage and in the event of divorce. If having a legal, binding document gives you additional confidence to move forward with the marriage, consider contacting an attorney to draft your prenup.

If you signed a Wisconsin prenup, and wish to challenge its validity, you must consult with an experienced family lawyer. Legal challenges to prenups are extremely fact-driven.

The Legal Background of DraftKings and FanDuel

admin — Sat, 14 Nov 2015 01:55:43 +0000

The two leading daily fantasy sports websites have employed an impressive marketing push. Their commercials and advertisements overload our televisions during every commercial break from our favorite weekly sitcom or while we gather to watch our favorite sports teams. It seems like their expensive push is working as hundreds of new customers are signing up every week. Aside from new fantasy league participants, the commercials are also garnering attention from state officials, Congress, and this week, the New York Attorney General. It seems as though it’s all fun and games until the law is broken.

How does it work? In fantasy sports, users put together their own teams based on real-life players. The outcome of the game is determined by how each player performs, accumulating points based on real-game performances. So unlike regular sports gambling, where you purely bet on the outcome of games, the law is classifying fantasy sports as a form of game where actual skills matter to win.

The way the websites operate is that you, as the participant, put money into an online account, which you are then allowed to use as your entry fees to participate in dozens of different contests. You can choose from a variety of sports including the NFL, NBA, NHL, PGA, and even NASCAR. Additionally, you have the discretion to select what type of contest you participate in on that particular day or week. You then choose, or draft, individual players to be on your fantasy team and based on their individual performance in their respective sporting event, your team may or may not win money as a result. DraftKings and FanDuel insist that achieving success centers around skill and not chance. The billion dollar companies stress that fantasy sports is about statistics, probability, trend analysis and patterns. Many users draft their lineups looking for gameday matchups to exploit and they claim research and number crunching gives them an edge, thus making it a game of skill, and not gambling.

Sports betting is illegal throughout most of the United States, as currently only four states allow sports betting. Another handful of states have made it known to DraftKings and FanDuel that their “alleged illegal behavior” is not welcome in their respective states. Federal law criminalizes gambling business that is done in violation of state law, and the penalties include jail time, fines, and potential for the seizure of assets. So, many people are wondering how are websites like DraftKings and FanDuel legal? Both advertise and market themselves as games of skill, opposed to games of chance, and thus fall under an exception to the gambling law created under the 2006 Unlawful Internet Gaming Enforcement Act. Most states have no laws that specifically address fantasy sports but do have gambling laws that might dictate whether they’re legal or not. Many permit betting on contests that depend more on skill rather than on chance. Two states ban betting on games materially affected by chance, while a few others prohibit betting if chance is a factor at all, no matter how minor or insignificant.

That’s a debatable idea. But regardless of which side you sit on, daily fantasy sports sites are completely legal under current laws — and will continue to flourish, racking up hundreds of millions of dollars in revenue.

What’s next? Lawmakers all over the country expect the fantasy sports industry to make a push for clear legislation. The distinction between what is a game of skill vs what is a game of chance is controversial and needs clarification. This could lead Congress to take up the issue and modify the current law.

Power of Attorney – A Powerful Estate Planning Tool

admin — Sat, 07 Nov 2015 01:56:17 +0000

A Power of Attorney allows an individual to designate an agent, which can be any knowledgeable adult, with the authority to make specific decisions in place of the individual giving that authority. The designated person operates as the individual’s agent and the power of attorney file allows his or her actions over what the individual states. The individual is able to take away the authority and can do so by canceling it or setting a time limit on the authority or the authority ends when the individual dies. Because of the significant impact Power of Attorney documents can have, it is important you carefully choose your agent(s). There are two primary Power of Attorney documents people most often seek: The Financial Power of Attorney and the Health Care Power of Attorney.

The Financial Power of Attorney appoints a person to make all of your financial decisions in the event that you cannot make them yourself. The benefit of this is that you can avoid the hassle and cost of having someone go to court and get named your guardian. You can allow your Financial Power of Attorney to be effective immediately or else become effective at a later date or event, such as your incapacity. An agent under your Financial Power of Attorney can only act during your lifetime, meaning upon the death of the individual, the agent’s authority ceases.

The Health Care Power of Attorney appoints a person to manage all of your medical decisions if you can’t make them yourself. The benefit of this is that it allows you to put someone you trust in charge of your medical choices, as opposed to having the Court appoint someone to make these decisions if you cannot. It may also be used to make or refuse to make an anatomical gift (donation of all or part of the human body to take effect upon the death of the donor). Like the Financial Power of Attorney, the Heath Care Power of Attorney can take effect immediately or upon incapacitation – it is up to the individual to make that decision. Looming medical decisions can have a powerful impact and grave consequences if not done right – keep those important decisions in your hands by putting a Health Care Power of Attorney in place.

Why do I need a will?

admin — Sat, 31 Oct 2015 00:57:21 +0000

Without a Will, the state will decide who receives the property you acquired throughout your lifetime. Does this seem fair to you?

If you don’t appoint a guardian for your minor children when you die, a judge will decide who raises your children. Creating a Will avoids this and puts you in control of your children’s future

Contrary to popular belief, in Wisconsin a handwritten Will is unenforceable. This is known as a “holographic will” and it is not recognized in Wisconsin. In order for a Will to be enforceable, certain legal formalities must be met.

Unfortunately, the old adage “you get what you pay for” is true when it comes to Wills. Today, there are many commercially designed “do it yourself” Will kits on the market. They are appealing because the cost is less than that which you would pay an attorney. However, there are many traps for the untrained eye. Estate tax consequences and administrative complications could arise due to lack of estate planning experience and a lack of understanding the law. In the end, you will end up paying more to fix the “do it yourself” mistake.

Many attorneys would agree that putting together other documents in place that allow others to make decisions for you in the event you become incapacitated is recommended. These documents are a Health Care Power of Attorney and the Durable Power of Attorney (which handles the financial affairs). Often times, these two documents are prepared along with the Will.

At the Law Office of Geoffrey J. Lorenz, LLC, we are able to make recommendations that best fit your lifestyle and your budget at an affordable cost to you and your family. Contact us today.

Can the same lawyer represent both spouses in a divorce?

admin — Thu, 22 Oct 2015 00:57:57 +0000

Many times potential clients will ask if both spouses can be represented by the same attorney for their divorce. The answer is no. In Wisconsin, a lawyer’s ethical obligations prohibit him or her from representing two parties in the same action who have adverse interests. Divorcing couples undoubtedly have adverse interests. Therefore, the same lawyer cannot advise both clients without violating his or her duty to one of them.

As an attorney, my duty to you, as my client, is to zealously advocate only your position, and ensure your interests. This is not possible if I also had a duty to work as hard as possible for your spouse’s interests as well.

I recently represented a client in a divorce case and the parties basically agreed on everything. In situations like this, I will represent one spouse and work with the other spouse to get all necessary documents written and signed, keeping my client’s best interests in mind. This way, I maintain my ethical obligations and my client receives sound advice and unbiased representation.

No two divorces are the same and it is best to consult with a divorce attorney, regardless of whether you believe you and your spouse agree on all issues. There are adequate means of handling amicable divorces that do not result in conflict of interests and unsatisfied spouses. I am happy to speak with you if you are searching for divorce representation tailored to fit your needs.

How can I keep my legal fees low for my family law dispute?

admin — Tue, 13 Oct 2015 00:58:36 +0000

Clients often seek the help of a family law attorney when they are facing difficult and emotional concerns for themselves or their children. Certain complex legal issues can no doubt become expensive. However, as a client, there are some actions you can take to minimize your legal fees for family law.

Request copies of documents via email, to cut down on letters, copies, and postage.
Cooperate with your family lawyer. Accept advice, stay in contact, and respond promptly to requests for information.
Identify your goals and focus with your lawyer on achieving them.
Understand which battles are worth fighting. Arguing over every point leads to high legal fees for family law.
Have regular discussions with your lawyer about legal fees. Review the monthly bills carefully. Your lawyer should be able to explain the purpose of all work billed.
Seek assistance from appropriate sources. Try to avoid using your lawyer like a (very expensive) therapist. Your lawyer can and should help you through difficult emotional times, but it is wise to consult a therapist, usually covered by health insurance, for non-legal counseling.
Inquire into alternative legal fees arrangements, including limited representation, flat fee, or hybrid billing rates.