Charles Kennedy, P. C. Attorney at Law Frequently Asked Questions

Why should I pay a lawyer a lot of money for some simple documents?

You can buy software that produces most of the estate planning documents an attorney will prepare for you. Using such documents could turn out all right for you and your heirs, but things could go horribly wrong as well, and you'll never know if you did it right until it's too late. You could end up paying a nursing home unnecessarily or your heirs could pay unnecessary taxes or expend legal fees fighting each other.

Only a qualified attorney can educate clients on what issues they should be aware of in their individual circumstances and then recommend appropriate language to deal with the client's specific situation. Do you have a taxable estate? Do you own significant amounts of tax-deferred retirement plans? Do you know how to fund the revocable trust provided on the computer program? Is there anything about your estate that is unusual, such as having a disabled child? In short, if there's anything about your situation that's not plain vanilla, you need to see a lawyer. And only a lawyer can determine whether your situation qualifies as "plain vanilla." As with joint accounts, the problems you may create by not getting competent legal advice probably won't be yours, but may well be your children's. Do you want to risk leaving that legacy?

Why should I pay a lawyer a lot of money for some simple documents?

When does a health care proxy take effect?

In general, a health care proxy takes effect only when the principal requires medical treatment and a physician determines that the principal is unable to communicate his or her wishes concerning treatment. How this works exactly can depend on the laws of the particular state and the terms of the health care proxy itself. A medical directive, whether part of a health care proxy or separate, will be followed when you can no longer direct medical providers yourself.

What if the principal regains the ability to communicate his or her own decisions?

If the principal becomes able to express his or her own wishes at any time, he or she will be listened to and the health care proxy will have no effect.

Can I move my Individual Retirement Account (IRA) from one financial institution to another?

You may withdraw the funds tax-free if you roll them over into a new IRA within 60 days. If you fail to complete the rollover in time, you will have to pay income taxes on the amount withdrawn and, if you are under 59 ½, a 10 percent penalty. But you may only do this once a year unless the transfer is effected from institution to institution without the funds passing through your hands. If the transaction is purely between institutions, you may move your IRA as often as you like without incurring any penalty. The 60-day rollover offers an opportunity for people who want to consolidate accounts, are moving, or expect to get a better return with a new institution. It can also be used in the event of a short-term cash shortage. But be careful to complete the rollover. If you do not, taxes and a penalty will be due on the amount withdrawn.

How do I find a good financial planner?

The best way (as with any professional) is to ask your friends, colleagues and relatives if they have worked with anyone they can recommend. Also, ask your lawyer or accountant, since they often work with financial planners. If these inquiries don’t turn up someone appropriate for you, check the Yellow Pages, call your Chamber of Commerce, or call 800-282-PLAN (7526) for the name of a Certified Financial Planner (CFP) in your area. Some planners charge a fee, while others provide the service without charge, hoping to make commissions on your investments. You may be able to find a fee-only financial planner by calling 888-FEE-ONLY (333-6659), which lists members of the National Association of Personal Financial Advisors. Interview your candidates over the phone to learn their approach to planning and investments. Ask for references, and make sure you follow up and call the references. After you have narrowed your field of prospects, meet at least two in person before you make your final selection.

Can I collect more than one Social Security benefit simultaneously?

No. If you are eligible for two benefit programs, you will receive the higher of the two benefit amounts, but not both. The exception is Supplemental Security Income, which you can receive while collecting benefits from another Social Security program.

What’s involved in appealing Social Security decisions, and is it worth it?

If your application for benefits is denied or you are receiving less than you believe you deserve, you can appeal. There are four stages of the appeal process, and you must go through one before you can move to the next.

At the first stage, reconsideration, your claim is reviewed by someone other than the person who made the initial decision regarding your benefits. This person’s decision is based on the material in your file when the original decision was made, plus any new evidence you would like to submit. Unless you are appealing a Social Security decision to terminate your disability benefits, you do not have a right to meet face-to-face with the person making the decision, although you can request to do so. A decision can take up to two or three months. If the decision goes against you, you have 65 days from the date on the written notice to appeal to the next level. A copy of the Request for Reconsideration form in PDF format is available from the Social Security Administration’s Web site. To find it, click here. You can also request the form from your local Social Security office or by calling 800-772-1213.

If the reconsideration goes against you, the next step is a formal administrative hearing before an independent administrative law judge (ALJ). Again, you must fill out a special form to request such a hearing. For an online copy of this form, click here, or you can contact your local Social Security office or call 800-772-1213. This hearing may be your best shot at getting an unfavorable decision reversed, so you should consider obtaining the services of an attorney or other professional knowledgeable about Social Security matters to assist you at this stage. (When providing written notice denying a claim, the SSA will send a list of local community groups and legal services organizations that can either help you with an appeal or refer you to someone who can.) You are allowed to appear at this hearing, and it’s in your best interests to do so. This puts a human face on the hearing and permits the judge to ask you questions. A friend, relative, attorney or other advocate may represent you at the hearing, and you can present witnesses or other evidence to the judge.

If the ALJ rules against you, your next step is the Social Security Appeals Council, which conducts reviews of hearing decisions. Your chances of success here are fairly slim. First, the Appeals Council does not review all cases that are appealed, and if it does decide to review your case, it meets only in Washington, D.C., so you will have to travel there or send a representative. Still, you must file an appeal to the Appeals Council in order to move on to the next step of taking the appeal to federal court. If you haven’t retained the services of an attorney knowledgeable about Social Security matters up to this point, you should seriously consider doing so now. If the Appeals Council is to overturn an ALJ decision, the odds are that it will do so only on the basis of a legal error made by the ALJ. Again, you must fill out a special form to request an Appeals Council review. For an online copy of this form, click here, or you can contact your local Social Security office or call 800-772-1213.

If you disagree with the Appeals Council’s decision in the case, you may file a civil lawsuit in the United States District Court (federal court) for the area where you live. You have 60 days after the Appeals Council decision is mailed to do so. Such a lawsuit is an expensive undertaking, but it may be worth it depending on the money at stake and the strength of your case. If you do decide to go forward, you will need to be represented by an attorney who is experienced in handling similar Social Security cases. Social Security law strictly limits the fees that attorneys can charge for such representation. Many lawyers will take a case at any stage in the appeals process on a contingency basis—that is, they will collect only if you win and will then take a percentage of your past due benefits. Social Security rules state that they can collect 25 percent of your past due benefits or $5,300, whichever is less.