If you read history, you know American independence was not easily won. There was no guarantee the fledgling colonies would win, but they fought long and hard and as a result, every July 4th we celebrate our nation’s independence. If you’ve got a young adult in your life, you know they’re often fighting in their own way to declare their independence.
As soon as they become legal adults, there are several legal tasks to take care of, especially if they are headed away from home to college in the fall or are moving to another state to start the next phase of their life.
General Durable Power of Attorney—Your child may not have a lot of assets, but chances are by the time they are young adults, they have a bank account, a credit card, and student loans. They may have already filed tax returns from after-school jobs or signed a lease for an apartment. If they become incapacitated, you may be unable to act on their behalf without a Power of Attorney.
An estate planning attorney can create a POA so your child can assign you the ability to serve as their agent and act on their behalf. You’ll be able to take care of their finances and make sure the financial side of their life is not left in shambles during the time they are incapacitated. Without it, you would have to go to court to obtain a conservatorship, a long and expensive process.
Health Care Power of Attorney—Once a minor child becomes a legal adult, health care providers may not speak to parents unless they have a Health Care Power of Attorney (sometimes called a Health Care Proxy). In an emergency situation, parents may be devastated to learn they can’t be involved in their own child’s care because the child is a legal adult. Any decisions may be made by the health care provider, not the family.
HIPAA Release Form—HIPAA (Health Insurance Portability and Accountability Act) is a federal law created to protect patient privacy. It presents a severe challenge to parents who are not prepared for its restrictions. Without a signed HIPAA release form, parents may not speak with medical personnel or access medical records, even when an adult child has suffered a serious injury or is extremely sick.
Health care providers do not make exceptions. Releasing medical records or having a conversation about a patient without a HIPAA release is a serious violation for a health care provider or hospital and can lead to large fines and litigation.
If your student is going to an out-of-state college or moving to another state, speak with an estate planning attorney to be sure these documents meet the requirements of the other state. Some estate planning attorneys advise clients to have two sets created—one for the state of residence and a second for their new state.
Sharing Digital Asset Information—This may be a little tricky for parents to navigate, as young adults can be fiercely protective of their online lives, but … all the more reason to get this done. Your young adult has an entire world online, from RPGs (Role-Playing Games) they play live with others to eSports competitive leagues to all the social media platforms you’ve heard of and many you have not. Your newly-adult child probably accesses their financial accounts on digital portals.
If your child should become incapacitated, or die unexpectedly, their digital accounts will not disappear. If their accounts are paid for with credit cards, as most are, those accounts are especially vulnerable to identity theft.
Financial institutions, hospitals, and others are wary of documents they deem out-of-date, so you’ll want to update the forms every few years, which is also when your estate plan should be updated.
Speak with Estate Planning Attorney, Rod Hatley, about protecting your child before they become independent adults.
Happy Fourth of July!