 Document Information Topic List

Welcome to the help system of Family Lawyer.  Document Information will provide you with the following topics:

For more information, see:


 Seeking Legal Counsel

We suggest that if you have a question concerning the construction of  your documents, you should seek legal counsel.  The information below will help you determine what type of  lawyer you may need and how to find a reliable professional in your area.

 Areas of Specialization

1. 	Wills, Powers of Attorney - the Area of Law Specialization is Probate, Wills, Trusts, and Estate Planning

2. 	Premarital Agreements - the Area of Law Specialization is Family Law.

3. 	Employment Documents, Employment Letters, and Consulting Agreements - the Area of Law Specialization is Employment Law.

4. 	Real Estate Leases and Home Purchase, Evaluation and Sale Worksheets - the Area of Law Specialization is Real Estate Law.

5. 	Promissory Notes, Equipment Leases, Minutes, Bills of Sale, Business Entity Planning Worksheets, and License Agreements - the Area of Law Specialization is Corporate and Business Law.

6. 	Consumer Complaint and Credit Letters - the Area of Law Specialization is Debtor/Credit Law.

Before you choose a lawyer based on his or her specialization, keep in mind that depending on the size of the firm, areas of specialization may vary.  In smaller firms, most lawyers are "general" and can respond to the questions raised in the above areas, whereas in larger firms, the lawyers tend to be more specialized in their areas of practice.  Of course, if you have any questions, you can discuss these with a lawyer or your state, provincial, or local bar association.

 Locating a Reputable Lawyer

Many legal matters are sensitive in nature, and you will want to ensure your questions are answered accurately and that your rights are protected.  Consequently, you will want to seek legal counsel from a knowledgeable and reputable lawyer.  To find a reputable lawyer, you can contact any of the following sources (in no particular order):

FRIENDS AND BUSINESS CONTACTS - Check with people who may have seen a lawyer regarding a legal issue in the same area of specialization as your problem.

LEGAL SERVICES AGENCIES - These agencies consist of lawyers who provide legal services primarily for persons who meet certain income guidelines.  However, many of these lawyers will answer a few questions or provide recommendation for anyone who contacts them.  Many legal services lawyers have good backgrounds and can answer questions on employment matters, real estate leases, and debtor/creditor issues. You can obtain more information by directly contacting the nearest legal services agency.

STATE, PROVINCIAL, AND LOCAL BAR ASSOCIATIONS - These associations of lawyers sometimes provide legal information and may offer referral services.  To contact your local bar association, look in the yellow pages of your telephone directory (under "Associations" or "Bar," depending on your directory).

OTHER PROFESSIONALS - Often other types of professionals, such as bankers, life insurance agents, and Realtors, can provide referrals.  For example, loan officers are frequently aware of general business lawyers who can help with questions on real estate, employment, general, and corporate law.  In addition, bank trust officers are often familiar with wills and estate planning.  Finally, accountants are often knowledgeable regarding business lawyers in the area.

MARTINDALE-HUBBELL LAW DIRECTORY - This reference book lists all lawyers in the United States or Canada.  The directory is a multi-volume resource, often available in larger public libraries.  Such libraries may also include similar services which include listings of lawyers.

For more information, see:

 DOCUMENT INFORMATION TOPIC LIST


 Wills and Estate Planning

 This program provides various personal and estate planning documents.  The Estate Planning Worksheet is a worksheet that helps gather the personal, financial and family information that is needed to prepare a Will.  The Simple Will is a will that can be used for estates of less than $450,000 to $600,000 to distribute property at death, name an executor, and if necessary, nominate a guardian to care for minor children.  As an alternative to using the Simple Will, the Living Trust or the Joint Living Trust can be used in conjunction with the Pour Over Will to achieve the same objectives.  The Living Trust and Joint Living Trust are "revocable", that is these documents can be amended and changed at a later time.  Some types of trusts are "irrevocable", for example, more complex life insurance trusts and charitable trusts, but those types of trusts are not offered by this program.

For more information, see:

 COMPLEX WILLS AND TRUSTS

 ESTATE PLANNING WORKSHEET

 JOINT LIVING TRUST

 LIFE INSURANCE TRUST

 LIVING TRUST

 POUR OVER WILL

 SIMPLE WILL

 TRUSTS

 WILLS AND TRUSTS

 DOCUMENT INFORMATION TOPIC LIST


 Consumer Letters

 There are two basic steps in making a consumer complaint. First, contact the person or company who sold the item or performed the service.  Explain the problem and what action you would like to see taken.  If you are unsuccessful, ask to speak with the supervisor or manager.  Often, a complaint is resolved at this level.

If you fail to receive a response at the local store, call or write to the person responsible for consumer complaints at company headquarters.  The consumer complaint letters in the program can help you write a letter.  Address letters to the company president or consumer office.  Many companies have toll-free telephone numbers, often printed on the product's package.  To find out if a company has a toll-free number, call 1-800-555-1212.

 Forwarding Your Complaint to Other Officials

You may also want to write a letter to your local consumer protection office.  Consult your telephone directory for county or city consumer protection offices. If no consumer protection office is listed for your state, refer to the Attorney General subtopic.  You may want to write to the Better Business Bureau or Attorney General with this program's letters.

 Keeping Track of Your Correspondence

When preparing to file a complaint, it is important to maintain records.  Make copies of correspondence and keep a written record of the people you speak with and what action was taken.  Do NOT send your original documents to the company.

For more information, see:

 COMPLAINT TO ATTORNEY GENERAL'S OFFICE

 COMPLAINT TO BETTER BUSINESS BUREAUS

 FILING A CONSUMER COMPLAINT

 DOCUMENT INFORMATION TOPIC LIST


 Company Contacts and Brand Name Information

If contact with the sales person or company representative does not resolve the problem, the next step is to send a letter to company headquarters.

Additional sources for company and brand name information can be obtained from the product label or warranty information or from the "Consumer's Resource Handbook" prepared by the Office of the Special Advisor to the President for Consumer Affairs.  A free copy of the handbook may be obtained by writing:  Handbook, Consumer Information Center, Pueblo, Colorado 81009.

You also can obtain information from the following books in your local library:

*  Standard & Poor's Register of Corporations, Directors, and Executives.

*  Standard Directory of Advertisers.

*  Thomas Register of American Manufacturers.

*  Trade Names Directory.

For more information, see:

 CONSUMER LETTERS

 FILING A CONSUMER COMPLAINT


 Complaint to Better Business Bureaus

 There are currently about 180 Better Business Bureaus (BBB's) in the United States.  These BBB's are nonprofit organizations sponsored by private local businesses. They offer a variety of information on products or services, reliability reports, background information on local businesses and organizations, and records of a company's complaint-handling performance.

Each BBB has its own policies regarding whether or not it will disclose the nature of a complaint against a business.  However, all BBB's will disclose whether a complaint has been registered against the business in which you are interested.

 What the BBB Can Do For You

Many of the BBB's will accept written complaints and will contact a firm on your behalf.  However, BBB's do not judge or rate individual products or brands, handle complaints concerning the prices of goods or services, or give legal advice.  If there is a situation involving potential liability (that is, an injury), the BBB will refer the complaint to the appropriate state government consumer office.  However, many BBB's do offer binding arbitration upon request.

 How to Locate the BBB Nearest You

Additional information regarding Better Business Bureaus may be obtained from the Council of Better Business Bureaus, Inc., 4200 Wilson Blvd., Arlington, VA 22203, 703-276-0100, or from the "Consumer's Resource Handbook," published by the Office of the Special Advisor to the President for Consumer Affairs and available free by writing:  Handbook, Consumer Information Center, Pueblo, CO 81009.

For more information, see:

 COMPLAINT TO ATTORNEY GENERAL'S OFFICE

 CONSUMER LETTERS

 DISTINCTION BETWEEN BBB AND STATE GOVT OFFICES

 FILING A CONSUMER COMPLAINT


Distinction Between BBB & State Gov't Offices
 Distinction Between BBB and State Government Offices

 The question of whether to write to the Better Business Bureau or the Attorney General's office depends on the questions involved and the nature of the complaint.  If you have been injured by a product, have contacted an attorney, or are interested in the legal ramifications of your rights, the Attorney General's office is a more appropriate choice.

If, however, you are interested in getting background information on the business's track record of handling complaints and want help contacting the business's company representative, the Better Business Bureau is better suited to handle such a complaint.  Explaining the nature of your complaint to the Better Business Bureau or the Attorney General's office will result in either one referring you to the proper agency.  Another option is to first write a letter to the Better Business Bureau.  If that avenue is ineffective, then write a letter to the Attorney General.  Include copies of all correspondence with the company and the Better Business Bureau.

For more information, see:

 COMPLAINT TO ATTORNEY GENERAL'S OFFICE

 COMPLAINT TO BETTER BUSINESS BUREAUS

 FILING A CONSUMER COMPLAINT


 Complaint to Attorney General's Office

 State government consumer offices can be helpful because they are easy to contact and are familiar with the state's businesses and laws.  State consumer offices are set up differently across the nation.  Some states have separate departments of consumer affairs, while others have a consumer affairs office as part of the governor's office or attorney general's office.  Contact your governor's office to help you locate the proper office or to refer you to the proper agency.

 Using the Consumer's Resource Handbook

Another good source for the addresses and telephone numbers of state consumer offices is the "Consumer's Resource Handbook" published by the Office of the Special Advisor to the President for Consumer Affairs and available free by writing:  Handbook, Consumer Information Center, Pueblo, CO 81009.

 Contacting State Consumer Offices

If your consumer problem relates to a business outside of the state in which you live, you should contact the consumer office in the state where you made the purchase. When you contact any state consumer office, you will need copies of the sales receipts and other sales documents and all correspondence you have had with the company.

For more information, see:

 COMPLAINT TO BETTER BUSINESS BUREAUS

 DISTINCTION BETWEEN BBB AND STATE GOVT OFFICES

 FILING A CONSUMER COMPLAINT


 Filing a Consumer Complaint

When you make a consumer complaint, whether by telephone call or letter, it is important to provide specific information regarding the product or service in question.

 What Information to Include in a Complaint

The description of the product should include the serial or model number, the size, color, and any other distinguishing characteristics.  Provide an accurate description of the service you received, the name of the person who performed the service, and when you received the service.

When describing the problem, be specific and to the point.  Merely stating that the product "did not work" does not give enough information.  A detailed summary of your complaint will aid the company in resolving your problem.

 The Manufacturer's Rights and Policies

If a product was misrepresented or defective, the seller or manufacturer has a legal obligation to refund the consumer's money.  If the product was defective, the obligation to refund the money may be subject to an opportunity to replace or repair the defective product.  Some businesses, however, follow a cash refund policy regardless of the reason for returning the merchandise.  Other businesses may have a return policy that all sales are final, or may only offer credit for returned merchandise.  Therefore, it is advisable to find out the store's return policy before making the purchase.

 Keeping Track of Your Correspondence

Do NOT send your original documents to the company.  Send COPIES of all the items that directly relate to your complaint.  Retain the originals and extra copies for your records.  Allow the company sufficient time to resolve your problem before seeking additional assistance.

For more information, see:

 COMPANY CONTACTS AND BRAND NAME INFO

 COMPLAINT TO ATTORNEY GENERAL'S OFFICE

 COMPLAINT TO BETTER BUSINESS BUREAUS

 CONSUMER LETTERS


 Credit Letters

 This program provides a number of letters designed to help you safeguard your rights as a consumer with respect to the extension of credit, credit card billing, and reporting of credit status.  Other letters focus on money owed and stopping payment on a check issued.  A small claims worksheet is included to help gather information that may be needed to process a claim.

For more information, see:

 BAD CHECK NOTICE

 CHALLENGE TO A CREDIT REPORT

 CHALLENGE TO A DENIAL OF CREDIT

 DEMAND FOR MONEY OWED

 STOP PAYMENT ON CHECK LETTER

 CREDIT CARD INQUIRY

 RECOURSE AGAINST COLLECTION

 REQUEST FOR A CREDIT REPORT

 SMALL CLAIMS WORKSHEET

 DOCUMENT INFORMATION TOPIC LIST


 Bad Check Notice

 A check is a promise to pay.  The debt or obligation for which the check is issued is not discharged until the check is paid.  When the check is not honored on presentation, the original debt for which the check was given is not discharged.

The person the money is owed to (the "Payee") may recover for such debt without relying upon the check.  The purpose of this letter is to advise the party signing the check (the "Drawer") of the failure of payment, and advises that payment is expected.  The letter must reasonably identify the particular item which has been dishonored by identifying the financial institution upon which the check was drawn, who it was made payable to, check number, date, and amount.

For more information, see:

 CREDIT LETTERS

 PAYMENT ARRANGEMENTS

 RETURNED ITEM INFORMATION


 Returned Item Information

The Bad Check Notice must reasonably identify the particular check or other item which was dishonored.  Identifying information includes:

* 	The financial institution upon which the check was drawn.

* 	The number of the check.

* 	Who it was made payable to.

* 	The date of the check.

* 	The amount of the check.

For more information, see:

 BAD CHECK NOTICE

 CREDIT LETTERS

 PAYMENT ARRANGEMENTS


 Payment Arrangements

 A check is only a conditional payment or a promise to pay. If a check has been returned unpaid, the payee may request an alternate form of payment by which the payee is assured of receiving payment.  Such payment takes the form of cash, a cashier's check drawn on the bank itself, money order, or other form of "guaranteed" payment.

For more information, see:

 BAD CHECK NOTICE

 CREDIT LETTERS

 RETURNED ITEM INFORMATION


 Challenge to a Credit Report

The purpose of this letter is to challenge an unfavorable entry in your credit report.

When you receive your credit report, you should review it carefully for any mistakes or information more than seven years old (ten years for bankruptcy).  If you do not understand something, ask.  The  credit bureau staff is required by law to explain your report to you.

 Correcting Mistakes

If there is a mistake or you wish to challenge an incorrect entry in your credit report, use the Challenge to a Credit Report letter.  You have a right to respond to a negative entry on your report and to have your response made part of your credit report.  Usually the credit bureau will advise you to contact the party that provided the negative information directly.

If there are mistakes, you can take the following actions:

1. 	Notify the credit bureau of the problem by using the Challenge to a Credit Report letter in this program.  Provide as much information as you can about what is wrong with the report.  The credit bureau must investigate the disputed information at no charge to you.  The credit bureau must correct any mistake or delete any information it cannot verify.

2. 	It may be helpful to contact the creditor directly to ensure that the creditor's records are correct.

3. 	If the above steps do not resolve the problem, you can file a written statement of up to 100 words with the credit bureau explaining your side of the story.  This explanation will be included in your credit report.

 Copy of the Credit Report

Usually a  copy of the actual credit report identifying the incorrect or challenged entry is useful for the credit bureau to investigate the problem.  There are instances in which you may not have a copy of the report. In such cases, identify the parties, the nature of the account, the outstanding balance on the account, and the nature of your complaint so that it may be easily identifiable.

Respond to the negative entry in your credit report file by explaining why the entry is incorrect; for example, explain that the outstanding balance is incorrect or payment already has been made.  Provide all information which might be relevant and useful to the credit bureau investigating your complaint.

For more information, see:

 CREDIT LETTERS

 FAIR CREDIT REPORTING ACT

 REQUEST FOR A CREDIT REPORT


 Fair Credit Reporting Act

The Fair Credit Reporting Act covers all reporting on individuals as consumers when you apply for and obtain credit, employment, and insurance.  The Act creates 13 consumer rights:

1. 	When a credit report is a factor in turning down an application, the reasons and the name and address of the credit reporting agency must be given.

2. 	Upon request, the credit reporting agency must inform you about the nature and substance of information in your credit file.

3. 	Upon request, the credit reporting agency must tell you who has received a report of your credit report file.  This extends to the past six months for credit and insurance purposes, and to the past two years for employment purposes.

4. 	If you find inaccurate and unverifiable information, it must be deleted from your credit file.

5. 	When you find inaccurate information, the credit reporting agency must investigate it.

6. 	If, after investigating, the credit reporting agency determines that the information is accurate, you have a right to dispute the item.  A brief explanation can be filed and made part of all future credit reports.

7. 	Your credit file must be kept confidential and used only for a legitimate business purpose.

8. 	Personal information in your credit file must not be provided to government agencies unless a court order is obtained.

9. 	If adverse personal information is in public records, you must be informed when it is reported for employment purposes.  You also can have this information kept current.

10. 	Adverse information must be deleted after seven years (after ten years in bankruptcy cases).

11. 	If an  investigative report is made on your personal life, you have the right to be informed, upon request, of the scope and nature of the report.

12. 	If you find that an investigative report contains adverse information, you have the right to have that item reinvestigated before the report can be reused.

13. 	If a credit reporting agency is negligent, you can collect actual damages.  If the negligence was willful, it may be possible to collect punitive damages plus attorney's fees and court costs.

If you have any questions or concerns regarding any of the above-mentioned "rights," consult your personal attorney. Remember, you are responsible for ensuring that your credit file is updated and accurate.

For more information, see:

 CHALLENGE TO A CREDIT REPORT

 CHALLENGE TO A DENIAL OF CREDIT

 REQUEST FOR A CREDIT REPORT


 Challenge to a Denial of Credit

 If your application for a loan or purchase of item(s) on credit has been denied, you can request the reasons or additional information regarding the denial.  If unfavorable action is taken regarding an existing account, you can request the reasons and additional information related to such action.  You must make this request within 60 days of receiving a denial of credit or notice of other adverse action.

The lending institution or entity extending credit must disclose the nature of the adverse information.  The lending institution is generally required to respond to your request within 30 days of receiving it.  The institution should give you sufficient identifying information to allow you to verify the accuracy.  If the reason is incorrect, you may use this letter to advise the lending institution of the correct information.

For more information, see:

 CHALLENGE TO A CREDIT REPORT

 CREDIT LETTERS

 FAIR CREDIT REPORTING ACT

 INVESTIGATIVE REPORT

 REQUEST FOR A CREDIT REPORT


 Investigative Report

 An investigative consumer report is a special credit report with more detail than a routine report.  It includes information about your character, general reputation, and personal characteristics.  It also may include information from interviews with neighbors, friends, or associates, and information concerning your credit standing, driving habits, and driving record.

 Requesting a Copy of an Investigative Report

If the information you receive from the lending institution indicates that an investigative report is being undertaken, you have the right (within a reasonable period of time) to request, in writing, a complete and accurate description of its nature and scope.

The lending institution must provide this information within five days after receiving your request.  It is not required to respond unless an investigation actually is performed, nor is it required to provide you information sources or a copy of the completed report.

Financial institution regulators recommend that institutions provide a complete and accurate description of the types of questions to be asked and the number and types of persons to be interviewed, along with the name and address of the investigating agency.

For more information, see:

 CHALLENGE TO A CREDIT REPORT

 CHALLENGE TO A DENIAL OF CREDIT

 REQUEST FOR A CREDIT REPORT


 Questions About Your Credit Card Bill

 If you see a charge on your statement that you do not recognize, first re-check your records to see if there is a charge you may have forgotten.  It is a good idea to keep your copy of all credit card receipts until those charges appear on your statement.  Also check to see if you've made any telephone or mail order charges.

Ask others who have access to your account if they made the charge.  Also check to see if the amount and date of the charge are familiar, even if you do not recognize the place or the merchant's name.  Companies may bill under a different name or from a central location.

 Contacting the Company

If you still do not recognize the transaction and think there is an error, or if you have a dispute with a merchant over the quality of merchandise or services, write the credit card company.

Federal law provides specific rules that the card issuer must follow for promptly correcting billing errors.  The card issuer provides a statement describing these rules when a credit card account is opened, with additional notices at least one a year.  Many card issuers print a summary of your rights on each bill they send you.

For more information, see:

 ADDITIONAL CREDIT CARD INFORMATION

 CREDIT CARD BILLING RIGHTS

 DISPUTES ABOUT MERCHANDISE OR SERVICES


 Credit Card Billing Rights

 The Federal Truth in Lending Act requires prompt correction of billing mistakes.  If you think your credit card statement contains an error, or if you need more information about a transaction on your bill, write your inquiry on a separate sheet of paper.  Do not write on the bill itself.

 Act Immediately!

To protect your rights, the Issuer must receive your written inquiry no later than 60 days after they send you the first bill in which the error or problem appeared.  Send your letter by certified mail, with a return receipt requested, to have proof that the card issuer received your letter.

Write to the Issuer at the address designated on the statement for such inquiries.  Many times this is a different address than the one to which payments are made on your account.

 What to Include in Your Correspondence

Your letter must include the: Cardholder's name and account number; dollar amount of the suspected error; explanation of the error, and why you believe there is an error;  description of the item in question;  and your signature.

 Handling Your Bill

While the error is being investigated, you do not have to pay any amount in question.  If you have authorized payment of the bill automatically from your savings or checking account, you can stop the payment on any amount you think is wrong.  To stop the payment, your letter must reach the Issuer within the specified number of business days before the automatic payment is scheduled to occur.

However, you are obligated to pay the remaining amount due which is not in question.  The Issuer cannot report the amount under investigation as delinquent or take any action to collect the amount in question.

The Issuer can continue to bill you for the amount in question, including finance charges, and can apply any unpaid amount against your credit limit.  If the Issuer finds there was a mistake on the bill, you will not have to pay any finance charges related to the amount in error.

For more information, see:

 ADDITIONAL CREDIT CARD INFORMATION

 DISPUTES ABOUT MERCHANDISE OR SERVICES

 QUESTIONS ABOUT YOUR CREDIT CARD BILL


 Disputes About Merchandise or Services

 If you have a problem with the quality of goods or services that you purchase with a credit card, first, you must attempt to correct the problem with the merchant.  If you do not receive satisfaction, you have the right to withhold payment for the merchandise or services.  You can withhold payment up to the amount of credit outstanding for the purchase, plus any finance charges. Write the Issuer to pursue this remedy.

This protection only applies if the purchase price was more than $50.00, and the purchase was made in your home state or within 100 miles of your mailing address.  All purchases are covered regardless of the amount or location of purchase if the Issuer owns or operates the merchant, or the goods or services were purchased from an advertisement mailed to you by the Issuer.

 Filing an Action in Small Claims Court

If the above conditions preclude you from pursuing the matter through the issuer, you may want to consider filing an action in small claims court - an informal legal proceeding that can be used to settle disputes.  The maximum amount that can be claimed or awarded varies from state to state, but most small claims courts hear cases involving amounts ranging from $25 to $1,500.  Check your local telephone book under your municipal, county, or state government headings for small claims court listings.

For more information, see:

 CREDIT CARD BILLING RIGHTS

 QUESTIONS ABOUT YOUR CREDIT CARD BILL

  SMALL CLAIMS WORKSHEET


 Follow-up of Credit Card Inquiry

 The Issuer must acknowledge your letter within 30 days, unless they have corrected the error by then.  Within 90 days of receiving your letter, the Issuer must investigate the error, and either correct the error or explain why the bill is correct.  The Issuer must send you a statement of the amount you owe and the date that it is due if the bill is found to be correct.

 Write the Issuer

If the Issuer's explanation does not satisfy you, you must write the Issuer within 10 days telling them that you still refuse to pay.  The Issuer may report you as delinquent at this point, but that report must also state that you have a question about your bill.  The Issuer must tell you the name of anyone who this information is reported to.  When the matter is finally settled, the Issuer must tell anyone who a report was made to, that the matter has been settled.

If you continue to have problems with the card issuer, seek the advice of legal counsel or contact your local consumer protection agency.  If the Issuer fails to make a proper response to a claim of billing error, it cannot collect the first $50.00 of the questioned amount and appropriate finance charges, even if your bill was correct.

For more information, see:

 ADDITIONAL CREDIT CARD INFORMATION

 CREDIT CARD BILLING RIGHTS

 QUESTIONS ABOUT YOUR CREDIT CARD BILL


 Additional Credit Card Information

 Send a copy, but not the original of the statements or charge slips to the Issuer.  You may ask for evidence of the charge such as a copy of the charge slip.  Keep copies of all correspondence with the Issuer, including copies of statements and charge slips.  You may need to refer to it, or send additional copies to the Issuer if you do not receive a prompt response to your inquiry.

 Be Careful with Your Credit Card Number

Take care not to let others see or hear your credit card number.  Most merchants now use carbonless credit slips. However, destroy any carbons, carefully dispose of statements and charge slips.  Never give your card number over the phone unless you are initiating a transaction with a reputable company.  If you have questions about a company, check with the local consumer protection office or Better Business Bureau before ordering.

 Reporting Lost or Stolen Credit Cards

If your cards are lost or stolen, immediately call the Issuer.  It is a good idea to keep a record of all cards issued to you, as well as the Issuer's phone number.  This information is generally contained on the back of each monthly statement.  Under federal law, if your credit card is used without your authorization, your maximum liability is $50.00 per card. If you report the loss before the card is used, the card issuer cannot hold you responsible for any unauthorized charges.

For more information, see:

 CREDIT CARD BILLING RIGHTS

 DISPUTES ABOUT MERCHANDISE OR SERVICES

 FOLLOW-UP OF CREDIT CARD INQUIRY

 QUESTIONS ABOUT YOUR CREDIT CARD BILL


 Demand for Money Owed

 The only permissible purpose of the Demand for Money Owed letter is for a creditor acting on his or her own behalf to collect debts owed to him or her.  The person preparing and signing this letter must be the person claiming the amount of money owed.

If the letter is not prepared for this purpose, you may be required to comply with the stringent requirements of the  Fair Debt Collection Practices Act. Your state may have its own collection requirements which also need to be considered.  Contact your state's attorney general's office or an attorney for such information.

 Collecting Money from Others

If the letter is prepared for collecting money owed to someone else, it is necessary for you to see your attorney to determine whether or not you qualify for one of the exceptions under the Fair Debt Collection Practices Act or whether you satisfy your individual state's requirements.

 Setting a Payment Due Date

When demanding payment for money owed on a past due account, promissory note, or agreement, it is customary to allow ten to thirty days from the date of the demand.  The deadline for payment must be a reasonable time after the date of the letter and should not be less than 10 days.

For more information, see:

 ACCRUED INTEREST ILLUSTRATION

 CREDIT LETTERS

 RECOURSE AGAINST COLLECTION


 Accrued Interest Illustration

The following example illustrates how to calculate "accrued interest" for the Demand for Money Owed letter.

Assume the following facts:

1. 	The debtor owes you $5,000.00 on an account or note that had an original balance of $8,000.00.

2. 	The amount owed bears interest at an annual rate of 12 percent.

3. 	Interest is owed from January 15, 1994.

4. 	The current date (or other specified date) is May 17, 1994.

You must calculate the accrued interest through the current (or specified) date.  You must also calculate the amount of interest that will be owed for each additional day after the specified date that the debt remains unpaid.

 Determining the Accrued Interest Amount

To determine the accrued interest amount:

1. 	Calculate the days from January 15 through May 17. (16 + 28 + 31 + 30 + 17 = 122)

2. 	The interest rate of 12 percent becomes the decimal figure 0.12.

3. 	The accrued interest amount is $200.55, based on this calculation:  $5,000.00 x 0.12 x 122/365 = $200.55.

The program calculates the daily accrual of interest as follows:

1. 	It calculates the annual amount of interest: $5,000.00 x 0.12 = 600.00.

2. 	It divides the annual amount of interest by 365 to obtain the daily accrual amount:  $600.00/365 = $1.64.

For more information, see:

 CONSUMER LETTERS

 REQUEST FOR A CREDIT REPORT


 Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act covers the collection of any personal, family, or household debt. The Act applies to the following:

1. Any person in the business of collecting debts.

2. Any creditor who collects debts using a name other than his/her own.

3. Anyone who collects or tries to collect debts for another person.

The Act does NOT apply to banks, other lenders, or businesses that collect their own debts, using their own names.

 Contacting the Debtor

A collector may contact a person other than the debtor ONLY for the purpose of locating the debtor.  In doing so, the collector must do the following:

1. 	Identify himself or herself.

2. 	Not reveal the consumer's debt.

3. 	Not use a postcard or any other means that might reveal the debt-collection activity.

4. 	Not contact the person more than once unless absolutely necessary.

5. 	If the collector learns the identity of an attorney who is representing the debtor, the contact must be with that attorney.

A collector CANNOT do the following:

1. 	Contact the debtor before 8 a.m. or after 9 p.m.

2. 	Contact the debtor at unusual places.

3. 	Contact the debtor at the place of employment if it is known that the employer prohibits such contact.

4. 	Harass or abuse the debtor.  This includes, but is not limited to:

a. 	Using or threatening violence or harm to the person, the person's reputation, or property;

b. 	Using obscene language;

c. 	Publicizing the debt;

d. 	Making annoying, repetitive, or anonymous phone calls;

e. 	Providing false or misleading information as to the collector's identity;

f. 	Collecting an additional fee not authorized by law or the terms of the debt agreement;

g. 	Charging the debtor with collect calls or telegram fees;

h. 	Communicating by postcard.

5. 	During the period when a debt is being verified, the collector may not ask for payment.

 Following Up with Written Correspondence

Within five days of contacting a debtor, the collector must send a written letter that includes the following information:

1. 	The amount of the debt.

2. 	The name of the creditor.

3. 	Notice that the debt will be assumed to be valid unless disputed within 30 days.

4. 	Notice that if the debt is disputed, the collector will verify and send a copy of the verification of judgment against the consumer.

 Non-Compliance with the Fair Debt Collection  Practices Act

If a debt collector does not comply with the Fair Debt Collection Practices Act, the debtor may sue the collector within one year after the violation.  It may be possible for the debtor to recover actual damages, additional damages up to $1,000, court costs, and reasonable attorney's fees.

If you have any questions or concerns regarding the application of the Act, consult your personal attorney.

For more information, see:

 CONSUMER LETTERS

 INVESTIGATIVE REPORT


 Recourse Against Collection

 The purpose of this letter is to respond to a demand letter sent to you by a creditor regarding your Account, Promissory Note, or Agreement.  This is your opportunity to explain why the demand for payment is incorrect.  You might explain, for example, that the balance is incorrect, a discount was not honored, payment has been made, or the invoice was never received because of a change in address.

Your rights as a debtor are governed by both the Fair Debt Collection Practices Act and your state's own collection requirements.  If you have any questions about the applicability of these requirements to you, consult your personal attorney.

Attach  copies of returned checks, payment records, and any other documentation which supports your claim that the balance as stated in the demand letter is incorrect. If you have documentation to support your claim for a discount, attach it to this letter.  If you have a copy of a returned check in payment of the amount owed, it is helpful to attach it also.  Do NOT send original documents.

For more information, see:

 CREDIT LETTERS

 FAIR DEBT COLLECTION PRACTICES ACT


 Request for a Credit Report

 If you have been denied credit or if other adverse action regarding your credit has been taken on the basis of a consumer credit report, you may want to use the "Request for Credit Report" to obtain a copy of your credit report and verify the information contained in it.  If the information reported is incorrect, you may use the "Challenge to a Credit Report Letter" to provide correct information to the credit reporting agency.

The purpose of the Request for a Credit Report letter is to assist you in obtaining a copy of your credit history, particularly if you have been denied credit within the last 30 days.  The credit report tells how you have managed credit in the past.  Companies examine your credit report before deciding whether to give you credit. The  Fair Credit Reporting Act does not permit you to obtain a copy of your credit report by telephone due to the confidential nature of your credit file.  However, a copy can be obtained by a signed written request.  If a  joint credit report of a husband and wife is requested, both the husband and wife must sign the request.  This request can be made in the form of a letter.

 If You Have Moved

If you have moved within the last several years, credit bureaus require previous address information.  You will need to include all addresses you have had for the last 2 to 5 years, depending on the  credit bureau. If you are making a joint request, provide the previous address of both spouses.

 Other Information Required

In addition, other information, including date of birth, social security number, employer, and phone number may be required.  Some credit bureaus require that you provide proof of identity such as a copy of your driver's license, military ID, insurance ID, or a current utility bill.

When you receive your credit report you should carefully review it.  You have the right to respond to a negative entry on your report and to have your response made part of your credit report.

For more information, see:

 CHALLENGE TO A CREDIT REPORT

 CHALLENGE TO A DENIAL OF CREDIT

 COMPLIMENTARY CREDIT REPORT

 COPIES OF CREDIT REPORT FILE

 CREDIT LETTERS

 CREDIT REPORT FEES


 Credit Bureaus

 The first step in obtaining your credit report is to check the telephone directory in your area for the name and address of the local credit bureaus.  You may find them listed in the telephone Yellow Pages under "Credit Bureaus" or "Credit Reporting Agencies."  Your local bank or retailer also may be able to identify them.  Credit bureaus must share with you any information they have on file about you.  Call the credit bureau to determine the fee that you will be charged to obtain a copy of your credit report.  If you have been denied credit in the last 30 days, there should be no charge.  Most credit bureaus will mail you a copy of your report, but you may wish to visit their offices to review your credit report.

There are three main credit bureau agencies in the United States that have credit information:

* Equifax

* TRW Credit

* TransUnion Corporation

The local credit bureaus have access to the information from your file through one of these three main agencies. Although these main bureaus have basically the same information from which to compile the report, they may provide slightly different information depending on a number of factors:  1) the geographic location in which the company is the strongest, 2) how quickly they can obtain the information, 3) their general access to the information, and 4) the number of times you have moved or changed addresses.

For more information, see:

 CREDIT REPORT FEES

 FAIR CREDIT REPORTING ACT

 JOINT CREDIT REPORT

 CREDIT LETTERS


 Joint Credit Report

 If a joint credit report is requested for a husband and wife, each spouse must provide his or her full name, current address and previous address within the last several years, social security number, date of birth, current employer, and phone number during normal business hours.  In addition, it is necessary for both spouses to sign the letter.

If your name includes Jr., Sr., III, or a similar appendage, be sure to include this with your name.

For more information, see:

 CHALLENGE TO A CREDIT REPORT

 FAIR CREDIT REPORTING ACT

 REQUEST FOR A CREDIT REPORT


 Credit Report Fees

 The fee for obtaining a credit report ranges from $8.00 for an individual report to $25.00 for a  joint report of a husband and wife.  Contact the  credit bureau, that you are sending the request to, to find out the cost of obtaining a report.  For information regarding a free credit report, read the  "Complimentary Credit Report" topic.

If you have been denied credit within the last 30 days, your credit report should be provided free of charge, but it is necessary for you to provide a copy of the letter from the company, agency, or organization which denied you credit within the last 30 days.

For more information, see:

 FAIR CREDIT REPORTING ACT

 REQUEST FOR A CREDIT REPORT


 Copies of Credit Report File

 If you have a copy of the credit report file, it is advisable to enclose a copy of the report and circle, highlight, or otherwise identify the portion of the credit report file which you are challenging.

Obviously, enclosing a copy of the credit report file with the entry highlighted or circled is the best practice.  There are, however, instances in which you may not have a copy of the report. In such cases, you should identify the parties, the nature of the account, the outstanding balance on the account, and the nature of your complaint so that it may be easily identifiable.

For more information, see:

 CREDIT LETTERS

 COPIES FOR CREDIT LETTERS

 CREDIT BUREAUS

 FAIR CREDIT REPORTING ACT

 JOINT CREDIT REPORT


 Complimentary Credit Report

TRW now provides one free credit report each calendar year.  To obtain this free report you must write to:

TRW

P.O. Box 2350

Chatsworth, CA 91313-2350

ATTN: Complimentary Report Request

You must provide your full name, current address and addresses for the past 5 years, social security number, year of birth, and your spouse's name.  Also, you must include a proof of identity such as a copy of your driver's license, military ID, insurance ID, or a current utility bill.

For more information, see:

 CREDIT BUREAUS

 CREDIT REPORT FEES

 CREDIT LETTERS


 Copies for Credit Letters

 If available, attach copies of all documentation which supports your claim that the credit card statement is incorrect, including credit card charge slips, receipts, or proof of payment.  Do NOT send your original documents.

For more information, see:

 CREDIT LETTERS

 RECOURSE AGAINST COLLECTION


 Small Claims Worksheet

 Most states have set up a small claims division of District Court in each county to provide an inexpensive and speedy method to settle most civil disputes involving money or personal property valued at several thousand dollars or less.  Each state has set its own maximum value that may be brought in small claims court.  The procedures of the court are informal, and while some states allow an attorney to appear with the plaintiff, Small Claims Court is designed to let the plaintiff represent him/herself.  The personnel at the courthouse are there to serve and will be glad to answer questions about various procedural matters.  The Plaintiff should remember, however, that the clerks and the judges cannot give legal advice.

 Ceilings on Amounts Claimed and Filing Fees

The state-specific ceilings on the amounts claimed, in order to come within the jurisdiction of Small Claims Court, range from $1,000 to $10,000.  The basic filing fees generally range from $25 to $50, and the judge or hearing officer may order that these costs be paid by the party who loses the case.

 The Court Hearing

In Small Claims Court, the two parties involved in the dispute go to the court at a preassigned time and tell their side of the story to the judge.  The plaintiff has the burden of proving that the defendant legally caused the damages suffered by the plaintiff, that there is legal liability on the part of the defendant based on the defendant's intent, negligence or breach of contract.  The plaintiff must also prove the amount of the damages.  The judge makes a decision based on the law governing the facts presented.  No juries are used in Small Claims Court.  Some states allow the losing party to appeal a small claims judgment.

For more information, see:

 APPEAL

 DAMAGES

 DEFENDANT INFORMATION

 HOW TO FILE

 LIABILITY

 POST JUDGMENT COLLECTION

 PREPARING THE CASE

 THE HEARING

 WHAT KIND OF CLAIM

 WHEN TO SUE

 WHETHER TO SUE

 WHO CAN SUE

 DOCUMENT INFORMATION TOPIC LIST


 Whether to Sue

 Before filing a suit in Small Claims Court, the plaintiff should always contact the other party and try to settle the dispute because litigation can be both time-consuming and expensive.  Many states require that a "demand letter" be sent to the defendant before a suit can be filed, so that settlement can be explored and litigation possibly avoided. If a settlement is reached, the agreement should be put in writing, contain all of the terms of the agreement, and it should be signed by both parties.

Furthermore, no suit should be filed unless the person to be sued has some way of paying the claim if the plaintiff wins the case.  In some cases, a person may be "judgment proof" because of a lack of income or property; therefore, even if the plaintiff is successful, there may be no current collection on that judgment.  However, judgments are good for a number of years and can usually be renewed thereafter.

For more information, see:

 DEFENDANT INFORMATION

 LIABILITY

 SMALL CLAIMS WORKSHEET

 WHAT KIND OF CLAIM

 WHEN TO SUE

 WHO CAN SUE


 When to Sue

 It is important to file suit promptly after realizing that no settlement can be reached.  The law sets a specific time period ("statute of limitation") within which a person must file suit.  After this period expires, the person cannot file suit.  Statutes of limitation vary with the type of claim.  The purpose of these statutes is to require the filing of lawsuits before the evidence becomes "stale", recognizing that memories fade and witnesses become unavailable.  Claims involving oral contracts must usually be brought within five years from the time the contract was made.  Written contracts generally have a longer statute of limitation, and some personal injury claims have a one year statute of limitation.  If in doubt about whether the claim is being brought within the proper time, the plaintiff should file; if too much time has passed, the judge will dismiss the claim and the plaintiff will lose the filing fee.

For more information, see:

 DAMAGES

 DEFENDANT INFORMATION

 HOW TO FILE

 LIABILITY

 PREPARING THE CASE

 SMALL CLAIMS WORKSHEET

 WHAT KIND OF CLAIM

 WHETHER TO SUE

 WHO CAN SUE


 Who Can Sue

 Some states prohibit certain categories of parties from suing in Small Claims Court, such as: a person or organization in the business of lending money at interest; a collection agency or a collection agent; a person or organization with an assigned claim.

A parent or legal guardian must appear in Small Claims Court on behalf of a minor or a person adjudged mentally disabled.

 Number of Plaintiffs and Claims

There can be multiple plaintiffs ("co-plaintiffs") if the claim arises out of a common contract or event, which damaged the multiple plaintiffs.  For example, if Husband and Wife were each injured in a single vehicle accident which was negligently caused by the defendant, the husband and wife can sue the defendant as co-plaintiffs.  Keep in mind, however, that the total damages claimed in the lawsuit must not exceed the maximum amount allowed in the small claims court.

Some states limit the number of claims, e.g.  to 25, that any single plaintiff may bring in any one calendar year in the Small Claims Court.

 Corporations and Small Claims Court

Some states prohibit a corporation from suing in Small Claims Court.  Others require that if the plaintiff is a corporation or partnership, then the person who comes to the trial/hearing must be (1) an officer of the corporation, (2) a person regularly employed in a managerial capacity by the corporation or partnership, or (3) an attorney.  If the plaintiff is an unincorporated business, the plaintiff should list his/her name followed by "...doing business as __________", inserting the name of the business.  If the claim is for damages to a vehicle, the plaintiff should be the registered owner(s) of the vehicle.

For more information, see:

 DEFENDANT INFORMATION

 LIABILITY

 SMALL CLAIMS WORKSHEET

 WHAT KIND OF CLAIM

 WHEN TO SUE

 WHETHER TO SUE


 What Kind of Claim

 The claim must be within the maximum amount allowed by the state.  The claim may include actual damages and court costs.  Certain kinds of claims are not allowed in Small Claims Court: criminal actions, cases of libel, slander, professional malpractice, assigned claims, alienation of affections, malicious prosecution, abuse of process, punitive damages meant as punishment for wrongful conduct, or an injunction to stop some activity -- must all be brought in another court.

Furthermore, complicated lawsuits should not be filed in Small Claims Court even if the loss is under the state's maximum.  The Court is not effective in resolving complaints when the wrongdoer cannot be found.  The Court is not the answer when the claim is against fly-by-night operators, companies no longer in business, people who have filed bankruptcy, or individuals who have no money or property.

For more information, see:

 DAMAGES

 DEFENDANT INFORMATION

 HOW TO FILE

 LIABILITY

 PREPARING THE CASE

 SMALL CLAIMS WORKSHEET

 THE HEARING

 WHEN TO SUE

 WHETHER TO SUE

 WHO CAN SUE


 Damages

 In determining the amount to claim in the suit, add up the total damages, loss, injury, etc.  Remember that each element of the claim must be proven, including each element of the damages requested.  On the other hand, the plaintiff should not overlook any damages, e.g.  interest on a promissory note, because the judge cannot award any amount not demanded in the petition.  The claim should also include a request for court costs, which are the costs of administering Small Claims matters, including filing fees, service fees, etc.

In proving the damages, the Plaintiff must be prepared to explain how he/she "mitigated" those damages, i.e., how the damages were kept to a minimum.  For example, if the defendant moved out of an apartment prior to the end of the lease term, without permission of the landlord, the landlord will not be able to collect unpaid rent from the defendant/tenant for the entire remaining period of the lease unless the landlord can show that he/she made (unsuccessful) attempts to re-lease the premises, which would have reduced the loss.

 Deciding Amount of Claim

In deciding how much to sue for under claims of property damage, the Plaintiff should obtain verifiable estimates of the cost to repair the damaged property, not replace the property with newer property, as well as an estimate of the fair market value of the property immediately prior to the damage.  The amount of the claim should be the lower of the two.  The Plaintiff will not be allowed to better him/herself as a result of the incident.  This principle may be unfair in the situation where the destroyed item was old, but in good condition.  The item will have low value, the replacement cost will be high, and the Plaintiff has the burden of proving the value.

For personal injury cases, add together out of pocket medical costs (not reimbursed by insurance), loss of pay for work missed (if the employee actually received less), and pain and suffering (if supported by medical bills).

For more information, see:

 DEFENDANT INFORMATION

 LIABILITY

 PREPARING THE CASE

 SMALL CLAIMS WORKSHEET

 THE HEARING

 WHAT KIND OF CLAIM


 Liability

 In order to succeed in Small Claims Court, the Plaintiff must be able to prove that the Defendant is legally responsible for the damages.  Not all "damages" sustained by the Plaintiff can be recovered.  For example, an unfulfilled promise of a gift cannot be sued upon because there is no legal theory upon which to hold the Defendant/promisor liable.

 Types of Lawsuits

The following are examples of the types of lawsuits which CAN be brought, provided that all of the legal elements can be proven to establish liability on the part of the Defendant and resultant loss to the Plaintiff:

(a) 	The Defendant has breached an oral, written or implied contract.  The elements of a binding contract are offer, acceptance (or collectively, an agreement on the part of both parties) and consideration (something was given in exchange for something in return).  The consideration can be a promise to do something in the future.

(b) 	The Defendant acted negligently.  The elements of negligence are (i) a duty on the part of the Defendant to act reasonably under the circumstances, (ii) breach of that duty, (iii) the breach caused the Plaintiff's injuries or property damages.  However, if the Plaintiff's own conduct contributed to the damages, the Plaintiff will need to check the state law regarding "comparative fault".  Some states allow the Plaintiff to recover for the proportion of damages caused by the Defendant; other states deny recovery if the Plaintiff was at fault more than 50%.

(c) 	The Defendant acted intentionally to cause injury or damage to the Plaintiff.  Here, punitive damages may even be recoverable, provided that they fall within the small claims court maximum amounts.

(d) 	The Defendant's product was defective and caused injury or damage.

(e) 	The Defendant's product failed to live up to the seller's oral, written or implied warranty, and the Defendant has refused to repair or replace the defective product.

(f) 	The Defendant has violated a statutory right held by the plaintiff; for example, the Plaintiff bought goods from the Defendant's door-to-door salesperson and the Defendant refuses to allow the Plaintiff to return the goods for a refund within the 3 days provided by law.

For more information, see:

 APPEAL

 DAMAGES

 DEFENDANT INFORMATION

 PREPARING THE CASE

 SMALL CLAIMS WORKSHEET

 THE HEARING

 WHAT KIND OF CLAIM

 WHEN TO SUE

 WHETHER TO SUE

 WHO CAN SUE


 How To File

 Generally, there are two parties to a lawsuit -- the plaintiff and the defendant.  The person or business who starts the lawsuit is called the plaintiff.  The party being sued is called the defendant.  A lawsuit begins when the plaintiff files a legal paper, called a complaint, with the Small Claims Court clerk, which explains the disagreement.

  Where to Sue

Decide in what county to file the small claims complaint and go to the court clerk's office in that county's courthouse. The small claims complaint may be filed in the county where the event occurred or where the defendant lives or does business (operates a place of business or dispatches sales representatives for the purpose of selling a product or service).  If the Plaintiff is suing about an act that caused injury to someone or something, the suit may be brought in the county where the act happened.  If the suit is against a corporation because of a breach of contract, then suit may be brought in the county in which the contract was made or where the contract was to have been performed. If the complaint concerns a contract but the defendant is not a corporation, then different rules apply and it may be best to file the complaint where the defendant lives.  Also, if the defendant has no contacts with the plaintiff's state, it may be necessary to sue in the state where the defendant is located.

  Stating the Claim

The Plaintiff should tell the clerk that he/she wishes to file a small claims action.  The clerk will supply a complaint form to fill out.  The description of the claim to be set forth on the form should be very simple and concise, only enough to let the defendant know the nature of the claim.  The details will be presented at the time of the hearing.  The court may require that documentation be attached to the form for certain types of claims.  The clerk is not an attorney and is not legally authorized to fill this out or provide legal advice.

  Ceiling on Claim

The maximum amount of money for which the Plaintiff can sue is set by each state legislature.  (See the Jurisdictional Amount paragraph below to see a state-specific list of maximum amounts.) Even if the claim is for more than the state's maximum, Small Claims Court can be used to sue for that maximum rather than go through a trial in another court. While the Plaintiff will not be able to later sue for the balance of the claim, the net amount recovered may be more than if attorney fees are required by bringing the case in formal court.  Another possibility is to split the claim based upon separate incidents of fault.  The defendant cannot be forced to defend more than once for any single incident, but separate claims, each for an amount within the court's maximum, may be filed against the same defendant. For example, if the defendant damaged the plaintiff's property on two separate occasions, each resulting in $2000 damage, the plaintiff can sue once for each $2000 incident, even if the state's maximum for small claims court is $2000.

The amount of the claim should include both the actual amount of damage due and any extra expenses incurred because of the damage.  The Plaintiff must be able to prove the amount of damages.

  Jurisdictional Amount

The maximum amount for which you can sue in small claims court varies from state to state.  Recently the following amounts were the maximum jurisdictional limits in the 50 states:

AL 	1,500 	MT 	3,000

AK 	5,000 	NE 	1,500

AZ 	1,500 	NV 	7,500

AR 	3,000 	NH 	2,500

CA 	5,000 	NJ 	2,000

CO 	3,500 	NM 	5,000

CT 	2,000 	NY 	3,000

DE 	15,000 	NC 	3,000

DC 	2,000 	ND 	5,000

FL 	2,500 	OH 	2,000

GA 	5,000 	OK 	2,500

HI 	3,500 	OR 	2,500

ID 	3,000 	PA 	5,000

IL 	2,500 	RI 	1,500

IN 	6,000 	SC 	2,500

IA 	3,000 	SD 	4,000

KS 	1,800 	TN 	10,000

KY 	1,500 	TX 	5,000

LA 	2,000 	UT 	5,000

ME 	3,000 	VT 	3,500

MD 	2,500 	VA 	1,000

MA 	2,000 	WA 	2,500

MI 	1,750 	WV 	5,000

MN 	5,000 	WI 	4,000

MS 	1,000 	WY 	2,000

MO 	1,500

  Identifying the Defendant

The Plaintiff must supply the correct address of the defendant.  If there is more than one defendant, the plaintiff must include the first and last name of each defendant and their current address.  It is not the clerk's job to find the defendant's address for use by the Plaintiff.  If the address is not known, consider looking in the phone book, tax records, police file, or licensing records.  If the suit is against a business, call the Secretary of State to determine if the business is incorporated and the corporation's process agent.  Give the Small Claims Court clerk the process agent's name and address for service.  If the business is unincorporated, the name of the owner(s) or partner(s) should be listed, followed by "...doing business as _______________", with the name of the business inserted.

If the claim is against an out of state corporation with no process agent listed for the state in which the Plaintiff lives, then notice should be sent to the Secretary of State. The Plaintiff will be responsible for the out-of-state service fee.  If the Plaintiff cannot determine who to sue and there are several parties involved, the claim may be too complex for Small Claims Court, and a private attorney should be contacted for advice and assistance.  It may be necessary to sue the business where it is located if it does not do business in the state of the plaintiff.

If the claim arises from a vehicle accident, both the driver and the registered owner(s) should be listed.  This information may be included on the police report of the accident.

If the defendant is a minor, both the minor and the parent(s)/legal guardian(s) should be listed.  It may be difficult to sue minors for breach of contract because they can disavow contracts which are not for a necessity of life. Furthermore, minors often do not have an income or many assets from which to collect a judgment, and most states limit the amount to which parents are liable for the acts of their children.

An attorney should be consulted if suit is to be brought against a governmental entity or against the estate of a deceased person.

In order to afford due protection to defendants who are away in the military, the plaintiff must usually sign a document stating that he/she "reasonably believes" that the defendant is not on active duty in the military.

  Serving the Papers

After completing and signing the complaint form, the Plaintiff must pay the filing fee and tell the clerk whether the defendant(s) is/are to be sent a copy by certified mail, return receipt requested, or if the sheriff, or private process server, is to personally deliver the complaint to the defendant(s).  In order to obtain a judgment against each defendant, every defendant listed must receive a copy of the petition, even if the defendants are living in the same house.  The plaintiff must pay the mailing cost or the sheriff's fee in advance.

If the complaint was sent to the defendant by certified mail and the post office could not deliver it (possibly because the street-wise defendant refused to accept delivery), then the Plaintiff should ask the sheriff, or a private process server, to deliver the complaint.

The Plaintiff should check back with the clerk a few days before the scheduled hearing date, to see that the defendant received a copy of the complaint.  The court usually does not send this information to the Plaintiff.  Remember, the case will not be heard by the judge until a specified number of days after the defendant receives a copy of the complaint.  If the defendant fails to show up at the hearing, the plaintiff must be able to prove to the judge that the defendant received notice.

Any costs incurred when filing the claim (e.g.  filing fees, costs of service on the defendant) are considered court costs, which can be included in the amount of the judgment.

 Hearing Date

The hearing (trial) date will be set by the court clerk, to occur within a specified number of days.  This date will be set late enough to allow time for the defendant to receive, and respond to, notice of the claim.  If the date is unreasonably inconvenient for either party, that party can submit a written request to the court clerk, asking that the date be changed, specifying the reason for the request.

For more information, see:

 DEFENDANT INFORMATION

 PREPARING THE CASE

 SMALL CLAIMS WORKSHEET

 WHAT KIND OF CLAIM


 Preparing the Case

  Outline

The plaintiff should plan what he/she will say and assemble the evidence.  All of the facts concerning the case must be presented to the judge in a simple, logical manner.  Start at the beginning and tell the story to the end.  Perhaps the plaintiff will benefit by observing another hearing prior to his/her own to get an idea of how Small Claims Court operates.  The judge will make his/her decision based upon conclusive evidence and/or the credibility of the witnesses.

The plaintiff may also want to go to the law library and do a little homework in order to better understand the legal issues.

  Evidence

Even though the procedures are more informal than regular court, the case must be proven by evidence.  Evidence consists of facts.  It includes what people saw.  Written documents (copies if the originals are not available) that help to show what happened, are essential for certain types of cases.  Written documents can include contracts, leases, letters, receipts, notices, invoices, medical records, tax records, pay check stubs, canceled checks, written estimates for repairs and police reports.  An "affidavit" is a notarized written statement provided by some person who has personal knowledge of the events described in the statement   Affidavits may be accepted  in court if that person, for good reasons, cannot be present in court at the trial.

Evidence may include statements that the defendant may have made to the plaintiff or to another person that admit that money is owed to the plaintiff or that admit that the plaintiff does not owe the defendant money.  It is sometimes very helpful to introduce the actual damaged goods, i.e. the vase that was broken or the jacket that was not properly sewn.  Pictures, video tapes, films or cassette tapes are also useful in showing the court conditions or circumstances that are difficult to describe.

The type of evidence needed depends on the case and what must be proven.  If the dispute is over a written contract of any kind, the plaintiff should bring the contract and show it to the judge.  If there are claims for medical expenses or property damage, the bills showing these expenses should be assembled to be shown to the judge.  If the suit is for the balance owing on an account, the plaintiff should bring to the hearing his/her records of the account, receipts, and any other agreements or correspondence pertaining to the account.  If the claim is from damages in an automobile collision, the plaintiff should bring pictures of the damaged property and the scene of the accident.  Evidence must be presented to prove every element of the case.

The judge is going to keep the evidence brought to trial. The party bringing the evidence should make a copy of anything he/she wishes to keep.

  Witnesses

A witness is a person who either heard or saw what happened or who has first-hand knowledge about the matter in dispute. A written statement, whether it is notarized or not, made by a person who is not present in court at the time of the hearing will generally not be accepted as evidence by the judge.  If the plaintiff feels that the witness is likely to be believable, the plaintiff may informally ask a witness to appear in court.  Individuals who were actually involved in the original matter can give their version of the story in court.  Also, "Witnesses" who did not view the incident, but are qualified to report on damage or liability may give "expert" testimony to the judge.  For example, a business employee could testify about standard business practice.

If the plaintiff wants someone to testify for him/her, and that person will not willingly come to court, the plaintiff can ask the court clerk to provide the plaintiff with a signed "subpoena" which is an order to a witness to appear at a certain time and place to give testimony upon a certain matter. A witness served with a subpoena is legally required to appear at the hearing.  The plaintiff must fill out the subpoena and see that it is served on that witness. The subpoena may be served by the sheriff or by a disinterested person over 18 years old by delivering or offering to deliver a copy to the witness.  The plaintiff must deliver the subpoena to the server, and pay the fee to have it served.  Plenty of time should be allowed before the hearing date for service.  Furthermore, the plaintiff should be sure that the witness(es) know(s) exactly where and when to appear.

The plaintiff should "prepare" the witness, before the hearing, by discussing with the witness what facts that witness can provide to the judge.  Expert witnesses, who can testify to an important aspect of the case, even though they were not eyewitnesses, can be paid a fee (however, these fees are generally not recoverable as "court costs").  Other subpoenaed witnesses can only receive the statutory witness fee, which is a fixed amount plus mileage to the courthouse. This amount must usually be paid by the plaintiff at the time a subpoena is requested, and the judge may later allow a successful plaintiff to recover this fee from the defendant, depending upon if the witness was essential to the case.

The plaintiff can also subpoena necessary documents which are in the custody of another person.  But first, a request should be made to the defendant or other party to produce them voluntarily.

  Hearsay Testimony

The court cannot accept "hearsay" testimony even in Small Claims Court.  No party or witness can testify to something that someone told them.  For example, the plaintiff cannot come to court and testify "Jane Jones told me that she saw the defendant throw a rock through my car window", nor can the plaintiff testify "Sam Smith, who is a great mechanic, looked at my car and told me that the defendant did a poor job on those repairs and they have to be done over".  That is "hearsay" testimony.  Jane Jones can come to court to testify that she saw the defendant throw a rock through the plaintiff's window.  And Sam Smith can come to court and say that he looked at the plaintiff's car and the defendant did a poor job of repairing it and the repairs have to be done over.  But the plaintiff cannot testify to what those persons told the plaintiff about what the other party had or had not done.  The judge decides what evidence is acceptable.

For more information, see:

 DEFENDANT INFORMATION

 HOW TO FILE

 LIABILITY

 SMALL CLAIMS WORKSHEET

 THE HEARING

 WHAT KIND OF CLAIM


 The Hearing

  Procedure

In Small Claims Court, the plaintiff is given only one date to appear, and that is the hearing date, or trial date.  The plaintiff must have all of the evidence and witnesses ready and in the court on that date.  Any evidence which the plaintiff had, but did not bring along on the hearing date, cannot be considered by the judge in deciding the case.

If the plaintiff fails to appear, the judge may dismiss the case and probably prevent the plaintiff from re-filing the case a second time.  Some states have an exception to this rule.  If the plaintiff is suing on an account or written document for the payment of money, the plaintiff can prepare and file a "Verification and Affidavit" form (name of form differs by state) in the clerk's office, and will not be required to appear personally at the hearing.  However, if the defendant does appear, there is a chance the plaintiff's claim will be denied by the court.  It is the best practice to always appear in person at the hearing.

On the hearing date, the plaintiff should get to the courtroom early.  He/She should have the evidence and witnesses along that will be needed to prove the case.

When the case is called by the court officer, the plaintiff should approach the front of the courtroom and tell the judge that he/she is present.  The judge should be addressed as either "Judge" or "Your Honor".  Even though the trial will generally be conducted informally, respect for the court must be shown at all times.  The judge will then swear in both parties by asking them if they will tell the truth about the disagreement.  The plaintiff will tell his/her side of the story.  The judge may ask questions so that the judge understands the plaintiff's claim better. At the time the plaintiff presents his/her side of the story, he/she may also call any witnesses or present any evidence to the judge.  Each party can also question the other party and his/her witnesses.

If the defendant does not show up for the hearing ("defaults"), the plaintiff must still be prepared to show the court proof of the claim.  If the plaintiff does not appear for the hearing, the case may be dismissed and the court may award a counterclaim if the defendant can prove his/her claim against the plaintiff.

If the plaintiff and defendant reach a settlement before the hearing, they should get a settlement form from the clerk, sign it, and give it to the judge at the hearing.  If the judge accepts the settlement, it then becomes a legally enforceable agreement.

  Presentation

The hearing is informal.  The plaintiff should keep the story as short as possible without neglecting important facts.  Do not repeat.  The judge is concerned only with the facts relevant to the case.  The judge is the sole individual who will decide the case and the only person that needs to be convinced; the plaintiff should speak only to the judge and should never argue with the defendant.  Even though the parties are familiar with the case, the judge is not; therefore, it is important that the plaintiff state everything as clearly as possible and support his/her statements with evidence.  Consider everything from the judge's perspective.

Courtroom appearance.  The plaintiff should:

- 	dress neatly;

- 	stand while talking to the judge;

- 	use notes rather than read a prepared statement;

- 	be polite at all times, address the other party as Mr. Smith or Ms. Jones, and never interrupt when the judge or the other party is speaking;

- 	introduce him/herself;

- 	be brief;

- 	be prepared;

- 	listen to the judge;

- 	act natural (not attempt to act like a lawyer).

When the plaintiff finishes presenting his/her evidence and hearing from any witnesses, the judge may ask questions. The judge will normally do all of the questioning if neither party is represented by an attorney.  If an attorney is present for one or both of the parties, then the attorney may also ask questions.

  Judgment

After the judge has heard all of the evidence presented by the parties, he/she will oftentimes decide the case while the parties are still present by issuing a "judgment".  A judgment is the final decision of the judge resolving the dispute and determining the rights and obligations of the parties.  However, in some cases, the judge may "take the matter under consideration", which means he/she will rule at a later time.  This is done if the judge needs to research the matter or, more often, if the judge feels that the losing party would be unduly embarrassed, angry or even violent.  In any of these cases, the parties will be notified of the ruling by mail.  A typical judgment entry includes interest to be paid to the successful party on the award.

  Transcript

If either side wants the testimony at the hearing to be recorded, he/she must ask the judge for a court reporter or to have the proceedings taped.  The court reporter is someone who makes a complete record of everything said at the hearing.  This should not be left until the last minute. Any costs of having the testimony reported or taped will be charged to the party requesting it.  In most cases, there is no need to have the testimony preserved in this manner. Instead, the judge will normally take adequate notes concerning testimony.

For more information, see:

 APPEAL

 DAMAGES

 DEFENDANT INFORMATION

 LIABILITY

 POST JUDGMENT COLLECTION

 SMALL CLAIMS WORKSHEET


 Defendant Information

  Formal Response

When the defendant is sued, he/she will receive a notice from the court clerk or the sheriff.  The notice will state the name and address of the plaintiff, the type of complaint, the amount of money or property claimed to be owed, and the time and date of the court hearing.  Some states require the defendant to file a written "answer" with the court clerk by a specified date after receiving notice of the claim.  On this form, the defendant acknowledges that he/she is aware of the suit and he/she may admit or deny any or all of the claims made by the plaintiff.  The defendant must deny all of the claims which he/she intends to dispute at the hearing.

  Informal Settlement

Even after the suit has been filed, the defendant has an opportunity to settle the differences out of court.  He/She should consider compromise.  Both time and money may be saved by all parties concerned by resolving the case prior to a court hearing.  In order to avoid a court hearing, the defendant should notify the plaintiff of his/her settlement offer.  If an agreement is reached, the parties should obtain a settlement form from the clerk, have it signed by both parties, and file the settlement with the judge on the day of the court hearing.  If the judge accepts the settlement, both parties will be required by law to obey it.

  Defense

The defendant should consider defending him/herself by: (a) arguing the dollar claim is exaggerated; (b) denying liability; or (c) filing a counterclaim (a suit in reverse against the plaintiff).

  Counterclaim

If the plaintiff owes the defendant money or personal property related to the same dispute involved in the lawsuit already filed, the defendant should consider filing a "counterclaim".  A counterclaim is a claim presented by a Defendant in opposition to the claim of the Plaintiff.  If the counterclaim exceeds the small claims court jurisdictional limit, the entire case may have to be transferred to regular court.  To file a counterclaim, he/she must follow essentially the same steps as for filing a complaint: (a) go to the office of the court clerk in the county where the original claim was filed at least one week (longer in some states) before the hearing date; (b) fill out the form and return it to the clerk's office at least five days (longer in some states) before the hearing date; (c) have a copy delivered to the plaintiff at least five days before the hearing date.  The judge will hear the plaintiff's claim and the defendant's counterclaim together.

  Cross-Claim

After considering the plaintiff's claim, the defendant may determine that someone else who is not a party to the action owes all or a part of the amount being claimed by the plaintiff.  In that event, the defendant may file what is known as a "cross claim" to bring in the additional party. The court clerk should be advised of this.

  Demand for Jury

Most states do not allow jury trials in small claims court. However, in some states, the defendant may be allowed to request a jury for claims which meet a minimum dollar amount.  If this is allowed, the defendant must give the court clerk notice in advance of the hearing, and the claim will then automatically be removed from Small Claims Court to the regular Civil Division of District Court (names of courts vary by state).  In District Court, (a) the defendant will usually be charged additional fees; (b) there will likely be a more formal procedure than in Small Claims Court; (c) it may take longer to hear the case; and (d) the defendant may need to hire an attorney to argue the case before the jury.

  Default

If the defendant receives notice that he/she has been sued, he/she must appear in court on the designated hearing date. If the defendant fails to appear at the court hearing, the judge may enter a legal judgment against the defendant for all money or property claimed by the plaintiff and require the defendant to pay all court costs.  A judgment is an official court order which may be enforced by garnishment of the defendant's wages or bank account or by execution on his/her property.  The defendant can attempt to have the judgment set aside if he/she did not receive proper notice; other excuses are usually ignored.

If the plaintiff fails to appear, the judge may dismiss the case and probably prevent the plaintiff from re-filing the case a second time.  Some states have an exception to this rule.  If the plaintiff is suing on an account or written document for the payment of money, the plaintiff can prepare and file a "Verification and Affidavit" form (name of form differs by state) in the clerk's office, and will not be required to appear personally at the hearing.  However, if the defendant does appear, there is a chance the plaintiff's claim will be denied by the court.  It is the best practice to always appear in person at the hearing.

For more information, see:

 HOW TO FILE

 LIABILITY

 PREPARING THE CASE

 SMALL CLAIMS WORKSHEET

 THE HEARING

 WHAT KIND OF CLAIM

 WHEN TO SUE

 WHETHER TO SUE

 WHO CAN SUE


 Appeal

  Whether to Appeal

If the losing party believes the judge's decision is wrong because the judge did not apply the law correctly, most states permit that party to appeal.  Some states do not allow a losing plaintiff to appeal, although a losing Defendant may do so.  The appeal will be to a higher court, and usually the appellate judge will not hear any new evidence.  The judge will only review the proceedings from Small Claims Court.  Therefore, the party should not appeal just because he/she did not win the suit.  However, other states allow for the entire case to be re-presented.  The higher court can uphold, change, or reverse the Small Claims Court judge's decision.  Appeals can be complicated; therefore, before filing an appeal, the party should consider getting legal assistance to help decide whether there are grounds for an appeal.  Appeals can also be costly, and if the appealing party loses the appeal, he/she will have to pay the original judgment and perhaps the court costs of the appeal and his/her attorney.

  How to Appeal

The party wishing to appeal must file a notice of appeal with the Small Claims Court clerk within approximately 10-20 days (time frame is state-specific) of the date on which the small claims judgment was "entered" (stamped of record) in the Small Claims Court clerk's office.  Some states also require that the appealing party file a statement of appeal with the clerk of the appellate court within approximately thirty days (time frame is state-specific) of filing the notice of appeal.  If this statement is required, it usually must contain the following information: (a) Inform the judge whether the party wants an oral argument, that is, whether he/she wants to be heard in person before the judge; (b) a fair and accurate summary of the evidence heard by the Small Claims Court; (c) a short statement why he/she believes the Small Claims Court erred in the judgment; and (d) an explanation to the Judge of the relief to which he/she believes he/she is entitled.  There is a fee which must be paid to the clerk at the time that the appeal is filed.

  Collection During Appeal

Taking an appeal does not prevent the other party from trying to collect on any judgment entered in its favor unless the appealing party files an appeal bond with the clerk of the appellate court.

For more information, see:

 DAMAGES

 DEFENDANT INFORMATION

 LIABILITY

 POST JUDGMENT COLLECTION

 SMALL CLAIMS WORKSHEET


Post Judgment Collection
 Post-Judgment Collection

  Preliminary Action

A judgment in small claims court is a legally enforceable court order entitling the winning party ("the judgment creditor") to receive the money awarded by the court.  When the judge decides the case, the losing party ("the judgment debtor") may be ordered to pay the creditor the money owed, in a lump sum or in installments.  However, on occasion, a judge will allow the debtor additional time before the judgment must be paid.  In any event, the creditor should do nothing until after the time has passed during which the debtor can appeal or ask to have a default judgment set aside.  The debtor should not be spurred into making an appeal during that time by being reminded of the judgment.

If the debtor fails to pay the judgment ordered by the court by the specified due date (time varies by state), additional action may be necessary.  Although a judgment is a legally enforceable court order, the creditor is responsible for taking any additional action necessary to collect the money. The creditor should contact the debtor to attempt to collect the judgment.  If the judgment can be collected in this way, time and money will be saved, and complex post-judgment collection procedures can be avoided.

  Choosing to Wait

The creditor could also choose to do nothing.  In many states, judgments automatically attach as a lien against any real estate located in the county where the judgment is obtained, including a home owned by the person owing the judgment.  The lien is usually good for 10-15 years (state-specific) and if the property is sold within that time, normally the lien must be satisfied, which means that the creditor is paid.  In other states, the judgment can be filed in the appropriate county to create such a lien. If the debtor makes a partial payment, the creditor should photocopy the check before cashing it.  If the debtor later stops making payments before the entire judgment is satisfied, the creditor has bank account information about the debtor.

  Enforcing the Judgment

If the creditor would rather not wait, and the debtor still refuses to pay the amount ordered by the court, and the time for appeal, if any, has passed, the creditor may wish to take legal action to enforce the judgment.  There are several separate post-judgment collection procedures available to collect the judgment.  The debtor's wages or bank account can be garnished, or an execution can be made on other property owned by the debtor.  These post-judgment collection procedures may be complex and difficult, and it is important that the procedures be followed closely in order to successfully collect the judgment.  In some cases, it may be necessary to consult with a private attorney.

  Satisfaction of Judgment

If/when the debtor pays the full amount of the judgment, the creditor should file a Satisfaction of Judgment form with the Court Clerk.  Some states provide for penalties/remedies against the creditor if the creditor fails to provide a Satisfaction of Judgment within a reasonable period of time following demand by the debtor.

  Garnishment

The first method of legally enforcing the judgment is called garnishment.  Garnishment is a procedure whereby the creditor can obtain money or property which belongs to the debtor but is in the hands of a third person.  There are several types of garnishment.  The type that is probably most familiar is garnishment of wages, which is allowed in nearly all states.  Additionally, if the debtor has money in any bank account, that money may be garnished.  However, the creditor must first find out the location of such bank account, and must garnish it before a street-wise debtor empties the account.

In order to get a garnishment, the creditor must file an affidavit in the same court clerk's office in which the judgment was entered.  The court clerk can supply the appropriate forms.  When this affidavit is on file, a garnishment order can be served on the third person ("garnishee") who has the debtor's money or property that the creditor wants.  This order can be served by the sheriff or, in some states, sent by first class or certified mail. Expenses incurred in this service, as well as the cost of garnishment, may be recoverable as costs and should be added to the amount requested in the garnishment.

The garnishee, after being served, must comply with the garnishment order or provide the court with an appropriate defense, e.g.  that the property is exempt from garnishment or that the garnishee holds no assets owed to the debtor. Both federal and state laws limit the amount of wages which can be garnished, depending on the debtor's income.  The clerk or sheriff should be able to assist the creditor in determining the amount that can be reached through garnishment, once the debtor's income is known.  Absent a valid defense, the garnishee is required to pay all of the non-exempt money the garnishee holds, not to exceed the plaintiff's claim and costs.  The garnishee might not have all of the amount of the judgment, but what money the garnishee has shall be paid and applied toward the judgment, unless the garnishee proves to the court that this money or property is exempt from garnishment.  For example, money received for support of dependent children and benefits received by reason of age, illness, disability, or length of service may be exempt.  If the garnishee fails to pay money that the creditor thinks the garnishee has, the creditor may bring a separate cause of action against the garnishee.  This is an independent claim, and the creditor should seek legal advice in pursuing this claim.

If the judgment was obtained in one county but the creditor has found someone who has money or property of the debtor in another county, it still may be possible to obtain a garnishment order from the court which rendered the judgment, and have it served on the garnishee by the sheriff of the garnishee's county.

If the debtor works for an employer located out-of-state, the creditor may still be able to garnish wages, if the employer is subject to process in the state where the judgment was entered.  The Secretary of State should be contacted to assist with this process.

No employer can discharge an employee because the employee's wages are garnished for any one indebtedness.

  Execution

The second method of legally enforcing the judgment is called execution.  This is a procedure which commands the sheriff to seize property of the debtor which can be sold and the money from the sale applied to the judgment.

An execution cannot be issued until ten days (varies by state) after the judgment is entered.  After this period has expired, the creditor may obtain an execution form from the court clerk in the county where the judgment was rendered.  The sheriff "executes" it by searching for property of the debtor within the county.  However, in many states, the sheriff will not proceed without an indication from the creditor stating specifically what property is to be seized.  In many cases, executing on personal property is fruitless.  That is because it is difficult to locate personal property that would bring enough at a public auction to cover (a) prior debts on the item (e.g.  bank car loan), (b) exempt amounts and (c) selling expenses. Because of the problems that can arise in attempting an execution, it may be best to consult with an attorney before proceeding with this step.

If there is no property in the county where the judgment was obtained, an execution may be issued in any county.

1. 	Personal Property.  Some states require that execution must be made against the debtor's personal property first before any real estate.  Personal property includes items such as household goods, tools, equipment, and automobiles.

2. 	Real Estate.  If there is not enough personal property, the sheriff may then execute upon land.  The sheriff may be provided with an execution for personal property and an execution for realty at the same time, so that if insufficient personal property is available, the sheriff can then execute on the real estate.

When real estate is in another county, the creditor must send the execution to the sheriff of the county where the real estate is located.  Some states require that the judgment first be entered ("transcribed") to the county where the property is located.

The sheriff often will require that the creditor post a bond to pay for any damages which might possibly be incurred in the event the attachment is proved wrongful in any way. Bonds may be purchased through an insurance company.

If the creditor has an execution on the debtor's property and the debt still remains, the creditor may need to have the property sold in order to collect the debt.  A court order is often required before a sale can be held.

  Exemptions

In addition to the fact that real estate, vehicles and appliances may be subject to outstanding debt which can exceed what could be realized upon a sale, each state exempts a state-specific amount of equity on certain items from execution.  The following is a typical list of statutory exemptions (dollar amounts represent current value, not cost; classifications and amounts vary by state): household furnishings up to $2000, jewelry and personal clothing up to $1000, trade tools up to $10,000, one motor vehicle up to $5000, one gun of any value, cash surrender value of life insurance up to $10,000 if the beneficiary is a family member, and all alimony, the family residence, pensions and social security benefits.

For example, if a state exempts $5,000 of equity in a motor vehicle, and the debtor owes the bank $6,000 on the vehicle, the sale should not be held unless the vehicle will bring at least $11,000 after subtracting the costs of the sale.

  Judgment Debtor Examination

Find out the assets of the debtor.  In order to legally enforce the judgment, the creditor will need to know if the debtor owns any property which can be seized, such as land or an automobile, or has a bank account or a salary from an employer which can be garnished.  If the creditor does not know this information and cannot learn it without help, most states permit the creditor to serve the debtor with written questions to find out the information needed. This is sometimes referred to as a "judgment debtor examination".

To schedule a judgment debtor examination in some states, the plaintiff must first obtain an "execution" form from the clerk's office and then fill out a form directing the sheriff to make a demand on the debtor for payment.  If this demand is returned by the sheriff "unsatisfied", that is, the judgment is not paid, then the plaintiff can ask the clerk's office to notify the debtor by written notice that he/she must come to the courthouse and answer questions under oath concerning his/her assets, including employment information.

In order to get the debtor into court to answer the questions, the creditor should:

1. 	Write down every question that the creditor wants the debtor to answer that will help satisfy the judgment.

2. 	Make arrangements with the court clerk for a time and place where the debtor shall appear to answer the questions.

3. 	Send a copy of the questions to the debtor with a notice stating (a) the name and address of the debtor who is to answer the questions, (b) the name and address of the person before whom the debtor shall appear to answer the questions, and (c) when and where the debtor shall appear to answer the questions.  The creditor should keep a copy of this list and make sure the clerk has a copy.

4. 	To insure that the debtor appears on the assigned date, the creditor should have the debtor subpoenaed.  At the request of the creditor, the clerk will issue a subpoena for attendance.  If the sheriff is to serve the subpoena, the creditor must pay the fee for service.

5. 	If the debtor fails to answer the questions, the creditor may request that the court issue an order requiring the debtor to answer the questions.

  Judgment-Proof Debtors

There are instances when a debtor has no job or other income and no assets that may be seized.  This type of debtor is "judgment proof" and there is no way to immediately collect the judgment.  Also, collecting any money from "fly-by-night operators" located in another area, companies no longer in business or people who have filed bankruptcy after the judgment may be impossible.  In addition, if the creditor obtained the judgment because the defendant did not appear, and the defendant has already moved and left no forwarding address, the creditor will probably be unable to collect the judgment due to the fact that locating the defendant will be impossible.  However, in most states, the judgment is good for 10-15 years (varies by state).  If the creditor can keep track of the debtor's address, the creditor can continue to call the debtor into court to determine the debtor's assets or employment.  Over that period of time, the debtor may acquire some assets which can be attached or a job in which the creditor can garnish wages.

For more information, see:

 APPEAL

 SMALL CLAIMS WORKSHEET


Stop Payment on Check Letter

 In nearly all states, a drawer may, by order to his/her bank, stop payment of any item payable for his/her account, but the order must be received at such time and in such manner as to "afford the bank a reasonable opportunity to act on it".  This means that the order must both (a) identify the check with reasonable accuracy, and (b) be received "in time".

(a) Identifying the check.  The order must identify the drawer's account (either by name or by account number) and the check (by number and/or by name of payee, and preferably including the date and the exact amount of the check). Oftentimes, banks will use a computer to search for the check by looking for a specified dollar amount.  This method can create problems if the EXACT amount of the check is not provided.  To the computer, a one-digit mistake in cents is the same as a one-digit mistake in the thousands-of-dollars. Therefore, if one or more items used to identify the check are given in error by the drawer to the bank, it is likely that the bank will not be held responsible if it fails to stop payment on the check.

(b) Timely notice to the bank.  The order, whether oral or written, must be received by the bank in sufficient time for the bank to put in place the procedures necessary to ensure that the check is not paid.  The required amount of time will vary from one bank to another.

For more information, see:

 CREDIT LETTERS

 LIABILITY OF THE BANK

 WHO CAN ORDER A STOP PAYMENT


Who can order a Stop Payment

 Generally, any person who is an owner or co-owner of the account can order the bank to stop payment of a check (i.e. even if it was the other co-owner who wrote the check). Additionally, upon the death or incompetence of the owner, any person "claiming an interest in the account" (e.g. family members or beneficiaries) can order a stop payment.

For more information, see:

 CREDIT LETTERS

 STOP PAYMENT ON CHECK LETTER

 LIABILITY OF THE BANK


Liability of the Bank

 Occasionally, a bank will pay a check and debit the drawer's account even though it had received the stop payment order in sufficient time and with sufficient identifying information to prevent that payment.  Nevertheless, the bank may not be liable to the drawer unless the drawer can show that he/she ultimately suffered a loss.  In other words, if the drawer rightfully owed the payee, then there is no loss to the drawer even if the bank paid the check.  There is only loss if the drawer can show that he did not owe the payment to the payee.

For example, assume the drawer wrote a check to Shade E. Dealer for a "Rolex" watch and later discovered that the watch was a fake.  The drawer notified the bank well before the check was paid and accurately identified the check.  The bank paid the check through oversight and debited the drawer's account for the amount of the check.  The drawer may be able to recover from the bank for the amount of the check.  However, the burden of proving the drawer's loss is on the drawer.

For more information, see:

 CREDIT LETTERS

 STOP PAYMENT ON CHECK LETTER

 WHO CAN ORDER A STOP PAYMENT


 Corporate Documents

 This program provides several corporate documents that you may find useful:  Board Minutes for small corporations;   Unanimous Consent for corporate action in lieu of a meeting; a  Notice and Waiver of Notice regarding corporate meetings; a  Corporate Worksheet, which contains information about members of the board of directors, corporate officers, and stockholders; a  Business Entity Planning Worksheet, which contains information primarily about "for profit" businesses; and a  Corporate Proxy document, under which a stockholder gives another person the authority associated with the stock owned by the stockholder.

Additionally, a  Confidentiality Agreement, which may be used between companies as well as in an employer/employee relationship, is available in the  Employment Documents category in this program.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 CONFIDENTIALITY AGREEMENT

 CORPORATE PROXY

 CORPORATE WORKSHEET

 MINUTES AND UNANIMOUS CONSENT

 NOTICE AND WAIVER

 DOCUMENT INFORMATION TOPIC LIST


 Minutes and Unanimous Consent

 A corporation takes official action through its board of directors and/or its shareholders.  The shareholders, as the owners of the corporation, elect the directors and take other significant corporate action.  The directors are responsible for general management of the corporation, and elect officers to carry out their instructions.  Directors and shareholders formalize their official actions by making a written record.  The written record may be in the form of "minutes", if the board and/or shareholders met formally, or in the form of a "corporate action by  unanimous consent", if the action was taken without a meeting.  The Minutes and Corporate Action by Consent documents offered by this program are intended primarily for use by small corporations that limit their documentation to one set of minutes (or action by unanimous consent) per year.  The program offers typical resolutions and provisions used by small corporations and provides appropriate explanations.  The program also provides opportunities to include unique provisions for special circumstances.  Some guidance is offered regarding corporate action that is more likely to be taken by shareholders than directors.

Corporate laws in most states offer shareholders considerable flexibility in requiring that certain actions MUST be taken by shareholders or MAY be taken by directors. Such requirements, if any, will generally be found in the corporation's incorporation documents.  Incorporation documents generally include the corporation's "articles of incorporation" (sometimes referred to as the "charter") and the bylaws.  You should refer to those documents to help you answer questions regarding whether a specific corporate resolution should be adopted by the shareholders or the directors.

After the preparation of "minutes" or "corporate action by  unanimous consent", it is recommended that a lawyer review the document to assure compliance with corporate documents and appropriate state corporate law.  It is also important to have a lawyer review the minutes or corporate action by unanimous consent if the corporation is (or has been) involved in unusual transactions, or if the corporation has more than one class of stock.  Different classes of stock may have different voting rights, values, and characteristics.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL OF PAST ACTIONS

 APPROVAL REQUIREMENT

 AUTHORIZATION OF FUTURE ACTIONS

 BORROWING AND BANKING MATTERS

 CORPORATE - OTHER

 CORPORATE WORKSHEET

 ELECTION OF CHAIR

 ELECTION OF DIRECTORS AND OFFICERS

 ISSUANCE OF STOCK

 NEXT MEETING

 NOTICE AND WAIVER

 QUORUMS AND PROXIES

 REPORTS


 Unanimous Consent

 Generally, corporate action is taken at a formal meeting and such actions are recorded as "resolutions" in the "minutes". Corporations with ten or fewer shareholders, and even fewer directors, (i.e., "closely held corporations") may find that it is easier to make decisions informally without a meeting. In such cases, the corporate action may be taken by a resolution signed by all of the shareholders (or directors) with no meeting (i.e., "corporate action by unanimous consent").  The incorporation documents should be reviewed for possible restrictions on the use of "action by unanimous consent".  A few states permit "action without a meeting" upon the written agreement of 90% of the directors.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL OF PAST ACTIONS

 APPROVAL REQUIREMENT

 AUTHORIZATION OF FUTURE ACTIONS

 BORROWING AND BANKING MATTERS

 CORPORATE - OTHER

 CORPORATE WORKSHEET

 ELECTION OF CHAIR

 ELECTION OF DIRECTORS AND OFFICERS

 ISSUANCE OF STOCK

 MINUTES AND UNANIMOUS CONSENT

 NEXT MEETING

 NOTICE AND WAIVER

 QUORUMS AND PROXIES

 REPORTS


 Notice and Waiver

 Generally, if corporate action will be taken at a meeting, the shareholders or directors are entitled to formal notice of the time, date, and place of meeting.  There are two exceptions.  First, in the case of a "regular" meeting of the board of directors, notice may not be required if the time, date, and place of the meeting were provided at the last meeting, or if the bylaws specify that notice of such meetings is not required.  Second, the directors and/or shareholders may "waive" the notice requirement by signing a short document, a "waiver", consenting to the lack of notice for a particular meeting.

This program's Notice/Waiver document can be used to prepare a "notice" or to "waive" the notice requirement.  The "notice" option allows the user to prepare a notice to the directors and/or shareholders which advises them of the meeting.  A copy of the notice can then be attached to the minutes as evidence that notice was provided.  The "waiver" option allows the user to generate waivers for the directors and/or shareholders.

For more information, see:

 CORPORATE DOCUMENTS

 MINUTES AND UNANIMOUS CONSENT

 QUORUMS AND PROXIES

 UNANIMOUS CONSENT


 Quorums and Proxies

 A corporation cannot take action legally, unless a "quorum" is present.  A "quorum" is the minimum number of (i) directors who must be present at a directors meeting, or (ii) shares of stock that must be represented by shareholders at a shareholders' meeting in order to conduct business or take action.  For example, if a corporation has 9 directors, and if the bylaws provide that a majority of the directors constitutes a quorum, then 5 directors must be present at the meeting in order to take official action.

If the meeting is a shareholders meeting, satisfying the quorum requirement requires a review of the number of shares represented by the shareholders.  It is not simply a matter of determining how many shareholders are present.   The following example provides an illustration.  Assume that a corporation has 4 stockholders who own stock as follows: Alice 35, Bob 30, Cathy 20, and Don 15.  Assume further that there is a 60% quorum requirement.  In this situation, the quorum requirement is met if just Alice and Bob are present, because they own a combined total of 65% of the shares of stock.  However, if Alice is not present, all three of the remaining shareholder would need to be present in order to have a sufficient amount of stock represented at the meeting.

The above example ignores the possibility of a stockholder being "present" at a meeting through a "proxy".  A "proxy" is an agreement (usually written) that permits an agent or a substitute to represent a shareholder at a shareholders' meeting.  In the above example, official action could be taken at a shareholders meeting without Alice, if Alice signed a written agreement that designated someone else (perhaps one of the other shareholders) to represent her at the meeting, and if the person she designated was present at the meeting (with a copy of the written agreement or other proof of the proxy arrangement).

For more information, see:

 DESIGNATION OF AUTHORITY

 DURATION OF PROXY

 MINUTES AND UNANIMOUS CONSENT

 NOTICE AND WAIVER

 UNANIMOUS CONSENT


 Approval Requirement

 Generally, corporate action is taken by a simple majority of (i) the directors present at a directors meeting, or (ii) shareholders present (or represented by proxy) at a shareholders' meeting who own a majority of the corporation's outstanding stock.  However, the shareholders are permitted to set a higher or lower approval requirement. For example, it is not unusual for the bylaws to include a provision that requires a two-thirds approval in order to amend the bylaws.  In some cases, a higher approval may be required for all director and shareholder actions, not just certain types of actions.  The incorporation documents, including the bylaws, should be reviewed to determine whether there are such requirements.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL OF PAST ACTIONS

 CORPORATE - OTHER

 CORPORATE WORKSHEET


 Election of Chair

 It is common for the minutes of a corporate meeting to specify the person who chaired the meeting, as well as the person who recorded the minutes.  The bylaws may specify the persons who should fulfill these roles.  For example, the bylaws may specify that the president shall chair directors and shareholders meetings and that the secretary shall record the minutes.

For more information, see:

 ELECTION OF DIRECTORS AND OFFICERS

 MINUTES AND UNANIMOUS CONSENT


 Election of Directors and Officers

 Generally, the shareholders elect directors in accordance with the bylaws.  The election is usually held on an annual basis.  In some cases, all directors are elected each year. In other cases, they are elected on a "staggered" basis. For example, a corporation with 5 directors might have a bylaws provision that provides for 2 year directors' terms with 2 directors elected every other year and 3 directors elected in the alternate years.

Officers are also elected in accordance with the bylaws, and are usually elected by the directors, rather than by the shareholders.

For more information, see:

 CORPORATE WORKSHEET

 ELECTION OF CHAIR

 MINUTES AND UNANIMOUS CONSENT


 Reports

 It is not unusual for officers or corporate employees to present reports at directors and/or shareholders meetings that explain certain corporate matters, but do not require formal action.  For example, the corporate treasurer may report on the status of a borrowing request that has been submitted to a lender, or a marketing person may report on quarterly sales.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL OF PAST ACTIONS

 APPROVAL REQUIREMENT

 AUTHORIZATION OF FUTURE ACTIONS

 BORROWING AND BANKING MATTERS

 CORPORATE - OTHER

 CORPORATE WORKSHEET

 ISSUANCE OF STOCK

 MINUTES AND UNANIMOUS CONSENT


 Adoption of Documents and Plans

 This optional section permits the user to record the corporation's adoption of certain types of documents and plans.  It is expected that a copy of the document (or plan) will be attached as part of the minutes.  Generally, these documents represent very important transactions that may require both director and shareholder approval.  These actions may also require a higher than normal approval vote. The content of the listed documents is beyond the scope of this program; it is highly recommended that an attorney's advice be obtained if any of these transactions have occurred (or will occur).

For more information, see:

 APPROVAL REQUIREMENT

 AUTHORIZATION OF FUTURE ACTIONS

 MINUTES AND UNANIMOUS CONSENT

 REPORTS

 UNANIMOUS CONSENT


 Approval of Past Actions

 For the protection of persons who have taken action on behalf of the corporation, it is not unusual for the directors and/or stockholders to approve these actions on an annual basis.  The "Approval of Actions" section of this document includes an "all actions subsequent to the last meeting" option which provides general approval.  Other important actions can be mentioned specifically.  These actions may include officer compensation, transactions with related parties, and purchases of significant assets.

The "Financial Statement" section provides for the acceptance and approval of the corporation's financial statements.

Other sections of this document provide for the  authorization of future actions to be taken at a future date.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL REQUIREMENT

 BORROWING AND BANKING MATTERS

 CORPORATE - OTHER


 Authorization of Future Actions

 This program provides a variety of opportunities to show the authorization of specific types of corporation action that will occur in the future.  For example, the "Authorization of Action" section provides options that authorize lease arrangements and the establishment of insurance and pension plans.

Other optional sections regarding the following items allow for authorization of various actions that involve the payment of corporate funds:

Salaries.

Bonuses.

Director's fees.

Contributions to profit sharing plans.

Dividends.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL OF PAST ACTIONS

 APPROVAL REQUIREMENT

 CORPORATE - OTHER


 Issuance of Stock

 If stock will be sold or issued, the approval of the shareholders should be obtained.  The issuance of stock may be subject to "preemptive" rights which entitle current shareholders to acquire a percentage of the new stock so that the individual percentages of ownership in the corporation are not reduced or diluted by the new issuance. If the corporation has more than one class of stock, the approval of all classes of stock is generally required.  You should refer to your incorporation documents and/or obtain the opinion of legal counsel.

For more information, see:

 APPROVAL REQUIREMENT

 AUTHORIZATION OF FUTURE ACTIONS

 BORROWING AND BANKING MATTERS

 CORPORATE - OTHER

 CORPORATE WORKSHEET


 Borrowing and Banking Matters

 The process of obtaining a loan from a lending institution (e.g. a bank) may include a requirement that the board of directors and/or the shareholders authorize the loan transaction.  This authorization is provided in the form of a "borrowing resolution" and shows that the officers of the corporation are authorized to sign the loan documents.

In addition, when a bank account is opened, a "banking resolution" may be required to establish the identities of the officers or employees who are authorized to sign checks on behalf of the corporation.

For more information, see:

 ADOPTION OF DOCUMENTS AND PLANS

 APPROVAL OF PAST ACTIONS

 APPROVAL REQUIREMENT

 AUTHORIZATION OF FUTURE ACTIONS

 CORPORATE - OTHER

 CORPORATE WORKSHEET

 ISSUANCE OF STOCK

 MINUTES AND UNANIMOUS CONSENT

 UNANIMOUS CONSENT


 Corporate - Other

 There may be actions taken by the directors and/or shareholders that are unique or unusual.  This optional "free-form" section allows the user to include such actions.


 Next Meeting

 Although not mandatory it may be desirable to specify the time and location of the next meeting.  This provision is more likely to be used in connection with "minutes" for a regular meeting of the board of directors.  It is less likely to be used in connection with annual and special meetings, or with the preparation of "unanimous consent" documents.

For more information, see:

 MINUTES AND UNANIMOUS CONSENT

 NOTICE AND WAIVER

 QUORUMS AND PROXIES

 UNANIMOUS CONSENT


 Corporate Worksheet

 The Corporate Worksheet is offered as an easy and convenient way to organize and print business records regarding shareholders, directors, officers, employees, and any other related parties.  The worksheet is not legally binding and uses the same format as the "business" records in the Personal Information section of this program.  By "pasting" from the "business" records in the Personal Information section to the Corporate Worksheet, a custom report can be generated.  For example, a list of directors for an upcoming board meeting.

The Corporate Worksheet can also be used to organize and print Individual records associated with the Personal Information Manager.

For more information, see:

 CORPORATE DOCUMENTS


 Business Entity Planning Worksheet

The purpose of the Business Entity Planning Worksheet is to identify basic information that is needed to form a new business or change the form of an existing business.  This program provides information regarding the following entities:

-  Sole proprietorship.

-  Partnership (general).

-  Limited partnership.

-  "C" corporation (regular).

-  "S" corporation.

-  Limited liability company.

This program also requests the preferences of the owners to determine which business entity (or entities) may be the most appropriate form of business.  This information can then be provided to an attorney, accountant, or other tax expert who will assist with the determination of the appropriate entity.  Generally, liability and income tax considerations are the most important factors in the selection of a particular business structure.  The summary provided by the program is not an adequate substitute for the expert advice of an attorney, accountant, or other knowledgeable business consultant.

For more information, see:

 "C" CORPORATION

 DISTRIBUTIONS TO OWNERS

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 NUMBER OF OWNERS

 OTHER FACTORS

 OWNER PREFERENCES

 "S" CORPORATION

 SOLE PROPRIETORSHIP

 TAXATION OF BUSINESS INCOME


 Sole Proprietorship

A sole proprietorship is an unincorporated business owned and managed entirely by one person (except to the extent that the owner may delegate management responsibilities to an employee).  It is the simplest form of business and has the following characteristics:

1.   The income and expenses are reported on Schedule C of the owner's individual income tax return (Form 1040).

2.   The owner withdraws equity from the business by withdrawing cash or using business funds for personal uses.

3.   The owner is personally liable for all of the debts and expenses of the business, that is, the owner's liability is "unlimited".

4.   A sole proprietor generally has less flexibility to deduct the costs of fringe benefits and is required to use a calendar year for tax purposes.

5.   A sole proprietorship terminates with the death of the sole proprietor.

6.   No organizational formalities are required for a sole proprietorship.  If the business uses a trade name, the owner may be required to register the trade name with the appropriate state and/or county officials.

The sole proprietorship form of business is most often used for small, low-risk businesses that have only a few employees and no need for more than one owner.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 "C" CORPORATION

 DISTRIBUTIONS TO OWNERS

 FRINGE BENEFITS

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 NUMBER OF OWNERS

 OTHER FACTORS

 OWNER PREFERENCES

 "S" CORPORATION

 TAXATION OF BUSINESS INCOME


 General Partnership

In very simplistic terms, a general partnership is a sole proprietorship, except that the partnership is owned and managed by more than one owner.  It has the following characteristics:

1.   The income and expenses are reported on a separate business return (Form 1065).  The net income of the partnership is then allocated to the partners on Schedule K-1 forms, and the individual partners report their respective shares of the income on their individual income tax returns (Form 1040).

2.   The partners make distributions of the business income to themselves by paying partnership "draws" or making capital distributions.

3.   Each partner is personally liable for all of the debts and expenses of the business, that is each partner's liability is "unlimited".

4.   A partner may have more flexibility in deducting the costs of providing fringe benefits than a sole proprietor; however, the costs of the fringe benefits that are provided for the partners may not be deductible.  Generally, a partnership must use a calendar year for tax purposes.

5.   A partnership terminates when a partner withdraws from the partnership or dies, but this result can be modified by making appropriate arrangements in a partnership agreement.

6.   Generally, organizational formalities are not required by statute to form a partnership, but it is advisable to have a partnership agreement that sets forth the agreement of the partners regarding the distribution of profits, the procedures for handling the death or withdrawal of a partner, and other matters.  Many states have specific statutes that govern partners and partnerships, particularly in the absence of a partnership agreement.  If the partnership uses a trade name, the owner may be required to register the trade name with the appropriate state and/or county officials.

The partnership form of business is most often used for small, low-risk businesses whose owners want to avoid the tax consequences that result from corporate ownership, and are willing to accept the liability risks associated with partnerships.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 "C" CORPORATION

 DISTRIBUTIONS TO OWNERS

 FRINGE BENEFITS

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 NUMBER OF OWNERS

 OTHER FACTORS

 OWNER PREFERENCES

 "S" CORPORATION

 SOLE PROPRIETORSHIP

 TAXATION OF BUSINESS INCOME


 Limited Partnership

A limited partnership is a form of business entity that is designed to cure one of the primary disadvantages of the general partnership, i.e., the "unlimited liability" problem.  It differs from the general partnership as follows:

1.   A limited partnership has one or more of both "general" and "limited" partners.  The general partner is responsible for the management of the partnership and receives a share of partnership profits and losses. The limited partners share in the profits and losses, but are not permitted to have any management responsibilities.  In return, their liability is limited to their respective capital contributions to the partnership.  The general partner has unlimited liability.

2.   Most states have specific limited partnership statutes that govern the formation and operation of limited partnerships.  In such cases, it is usually a requirement that a certificate of limited partnership be filed with the secretary of state in a manner similar to the requirement that a corporation file articles of incorporation.

3.   Limited partnership statutes usually require that the partnership name include the words "limited partnership" or the abbreviation "L.P."

The limited partnership form of business is most often used for specific projects, for which a developer (the general partner with technical and management expertise) wishes to attract investors (limited partners) who do not want the risk of personal liability and probably do not want to participate in management either.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 "C" CORPORATION

 DISTRIBUTIONS TO OWNERS

 FRINGE BENEFITS

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 NUMBER OF OWNERS

 OTHER FACTORS

 OWNER PREFERENCES

 "S" CORPORATION

 SOLE PROPRIETORSHIP

 TAXATION OF BUSINESS INCOME


 "C" Corporation

A "C" (or "regular") corporation is a separate legal entity owned by one or more shareholders.  The shareholders elect directors who have overall responsibility for the management of the corporation.  The directors elect officers who carry out the wishes of the directors.  In small corporations, the shareholders may also be directors and officers.

1.   The income and expenses are reported on a separate business return (Form 1120).  Unlike the other forms of business entities, the corporation then pays taxes based on its net income, instead of allocating the income to the owners.

2.   The directors and/or shareholders can authorize distributions of the business income to the shareholders by directing the payment of dividends. The payment of dividends can result in the "double taxation" problem discussed in the  "Distributions to Owners" topic.

3.   The owners of the business (the shareholders) enjoy "limited liability", that is, the shareholders are only liable for the debts and expenses of the corporation up to the amounts of their respective capital contributions.

4.   Generally, corporations have the most flexibility in deducting the costs of providing fringe benefits, particularly the costs of fringe benefits that directly benefit owners (shareholders) who are also officers and/or employees of the corporation.  A corporation may select any fiscal year for its tax year end.

5.   Most corporations are perpetual, that is, the corporation continues to exist even though individual shareholders may die.  This continued existence, however, does not mean that the corporation should not make plans for the possibility of the death of a shareholder, particularly if the shareholder owns many shares and/or is a key employee of the corporation.

6.   All states have specific corporation statutes that govern the formation and operation of corporations. The corporation is formed by filing articles of incorporation (or a similar document) with the Secretary of State. Generally, a corporation adopts bylaws, elects officers, issues stock and takes other actions required by state law. After formation, the corporation must observe certain formalities in order to preserve its separate legal status. Annual reports must be filed with the state and state taxes must be paid or the corporation's existence may be canceled.

7.   Corporation statutes usually require that the corporate name include some designation that the business is incorporated, such as the inclusion of "Corporation", "Incorporation", "Company", "Limited" or some abbreviation of those words, such as "Corp.", "Inc.", "Co." or "Ltd."

8.   If the corporation will conduct business in other states, the corporation may need to "qualify" to do business in such states depending on the nature of the business activity within the particular state.  This may require the filing as a "foreign corporation", applying for fictitious name registration, and paying appropriate state income and franchise taxes.  Many states impose penalties for the failure to file as a foreign corporation.

"C" corporations are formed in cases where all of the owners wish to have "limited liability".  In addition, the corporate form may be preferable if corporate tax rates are lower than individual rates.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 OTHER FACTORS

 "S" CORPORATION

 SOLE PROPRIETORSHIP


 "S" Corporation

An "S" corporation is a form of business entity that is designed to combine the "limited liability" feature of the "C" corporation with the tax consequences of the partnership.  Thus, the "S" corporation differs from the "C" corporation as follows:

1.   The owners (shareholders) of an "S" corporation elect such status by filing Form 2553 with the Internal Revenue Service.  In all other respects, the formation of an "S" corporation is similar to the formation of a "C" corporation, i.e., articles of incorporation must be filed with the Secretary of State.

2.   The income and expenses of an "S" corporation are reported on a separate business return (Form 1120S). Like the partnership, the net income of the corporation is then allocated to the owners (shareholders) on Schedule K-1 forms, and the individual shareholders report their respective shares of the income on their individual income tax returns (Form 1040).

3.   Generally, the overall tax benefits of fringe benefits are less for an "S" corporation than a "C" corporation. For example, the costs of health insurance benefits provided to a shareholder (and employee) who owns 2% or more of the corporation are taxable income to the employee.  In addition, an "S" corporation is generally required to use a calendar year as its tax year. Finally, there are other technical tax rules that apply to "S" corporations. For example, there are restrictions on the number of shareholders, i.e. 35, restrictions on what kinds of entities can be shareholders, and the corporation can issue only one type of stock.  Election for S status must be made in a timely fashion after incorporation.  Generally, the election must be filed with the IRS on or prior to the 15th day of the third month of corporate year in which the election will be effective.  An election after that date is effective for the following tax year.

The "S" corporation form of business is most often used by owners who want the "limited liability" feature of the corporation, but do not want the tax consequences of a "C" corporation.  In other words the owners want to either avoid the "double taxation" problem, or have the business income taxed at individual rates rather than corporate rates, or both.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 "C" CORPORATION

 DISTRIBUTIONS TO OWNERS

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 OTHER FACTORS

 SOLE PROPRIETORSHIP


 Limited Liability Company

 The limited liability company (LLC) is a form of business entity which represents a second attempt (in addition to the "S" corporation) to combine the "limited liability" feature of the "C" corporation with the tax consequences of the partnership.  LLCs are a relative new form of business entity.  Although Wyoming enacted the first LLC statute in 1977, other states did not follow suit in significant numbers until the early 1990s.  The limited liability company has the following characteristics:

1.   Similar to a corporation, LLC statutes provide that the owners ("members") of an LLC have limited liability.

2.   To avoid the characterization by the Internal Revenue Service (IRS) that the LLC should be taxed as a corporation, the LLC statutes try to distinguish LLCs from corporations. The IRS has determined that the following four characteristics define a corporation:

-  Limited liability.

-  Continuity of life.

-  Centralization of management.

-  Free transferability of ownership.

If the LLC has no more than 2 of these characteristics, the IRS has determined that the LLC will be considered a partnership for tax purposes, rather than a corporation.

3.   The owners of the LLC have "limited liability" for the debts and expenses of the LLC.  Because this limited liability characteristic is a given, the LLC is only allowed to have one of the other three characteristics. Generally, the LLC statutes try to allow the owners (members) to avoid all of the other 3 characteristics.

4.   "Continuity of life" is the continuation of the business entity without regard to the deaths of the owners. Some LLC statutes avoid this characteristic by limiting the duration of the LLC to a specified number of years, and others simply provide that the duration of the LLC cannot be perpetual.

5.   A corporation has "centralization of management" because of its management through a board of directors. This corporate characteristic can be avoided by giving all LLC members the right to be involved in the management of the LLC.  If the owners of an LLC choose to allow only certain members to participate in management, the LLC can still avoid tax status as a corporation by avoiding two of the other three corporate characteristics.

6.   Generally, the owners of a corporation can "freely transfer their ownership" in the corporation by selling their shares of stock.  To avoid this corporate characteristic, LLC statutes provide that an owner (member) in an LLC may not transfer his/her shares without the consent of all of the other members.  An LLC is not required to restrict ownership transfers, but if it fails to include such restrictions, the LLC will have to make sure that it fails two of the other four corporate characteristics.

7.   Assuming that the business does not include more than 2 corporate characteristics, the LLC is treated by the Internal Revenue Service as a partnership for tax purposes. Therefore, the income and expenses are reported on the partnership tax return (Form 1065). The net income of the partnership is then allocated to the owners ("members") on Schedule K-1 forms, and the individual members report their respective shares of the income on their individual income tax returns (Form 1040).

8.   Over 30 states now have specific LLC statutes that govern the formation and operation of LLCs.  An LLC is formed by filing articles of organization with the Secretary of State.  The LLC is also required to adopt an operating agreement that sets forth the rights and obligations of the owners, as well as how the LLC will be operated.  Two or more persons must be members of an LLC at the time it is formed.

9.   LLC statutes require that certain words such as "Limited Company" or "L.C." be included in the name of the LLC to show its status as an LLC.

The LLC form of business entity is used primarily by small businesses that want (i) limited liability, (ii) the tax benefits of a partnership, and (iii) freedom from the "S" corporation eligibility requirements.  However, there are uncertainties involved with the formation of an LLC because it is a relatively new form of entity and not all states have LLC statutes.  In other words, the state where the business is located, and any other state where business will be conducted, must have an LLC statute.  As of August 31, 1993, the following states permit the formation of LLCs: Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Rhode Island, South Dakota, Texas, Utah, Virginia, West Virginia and Wyoming.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 LIMITED LIABILITY

 LIMITED PARTNERSHIP

 OTHER FACTORS

 TAXATION OF BUSINESS INCOME


 Owner Preferences

 The purpose of the Owner Preferences section is to use the preferences of the owners to determine which business entity (or entities) may be the most appropriate form of business. The factors that are usually given the most weight in determining the appropriate form of business are (i) the amount of tax paid on the income of the business, (ii) the desirability of making substantial distributions of the business income to the owners, and (iii) limited liability protection for the owners.  This section includes a chart that provides a score for each type of entity, based on the preferences of the owner(s).  This summary may provide some guidance in the selection of a business entity form. However, it is inappropriate to select a business entity by simply selecting the entity form with the highest number of responses.  Each form of entity has advantages and disadvantages that may be important or less important, depending on the circumstances that apply to a specific situation.  The advice of an attorney, accountant, or other tax expert should be obtained before making a decision.

For more information, see:

 DISTRIBUTIONS TO OWNERS

 FRINGE BENEFITS

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED PARTNERSHIP

 NUMBER OF OWNERS

 OTHER FACTORS

 SOLE PROPRIETORSHIP


 Taxation of Business Income

 The income and expenses of a sole proprietorship are reported on Schedule C of the owner's individual income tax return (Form 1040).  The income and expenses of partnerships (general and limited), "S" corporations, and limited liability companies are reported on a separate business return (Form 1065 or Form 1120S); however, the net income of the business is then allocated to the individual owners on Schedule K-1 forms, and the individual owners report their respective shares of the income on their individual income tax returns (Form 1040).  A "C" corporation reports its income and expenses on Form 1120, and pays taxes on the income at corporate rates.  Thus, the net business income of all business entities (except the "C" corporation) is taxed at individual rates.  Corporate rates are generally lower if net business income does not exceed $75,000.  If net business income is expected to be less than $75,000, a "C" corporation may be preferable.  If net business income is expected to be more than $75,000, it may be preferable have some other form of business.  This tax analysis is greatly simplified, and is not a substitute for the advice of a tax expert.

For more information, see:

 "C" CORPORATION

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 OTHER FACTORS

 "S" CORPORATION

 SOLE PROPRIETORSHIP


 Distributions to Owners

 Sole Proprietorship

The owner of a sole proprietorship withdraws equity from the business by withdrawing cash or using business funds for personal uses.  A partnership (general or limited) or limited liability company makes distributions by paying partnership "draws" or making capital distributions.  "S" corporations make distributions by paying dividends.  The key points are:

-  The business income of these entities is paid only once, i.e., at the individual level.

-  Generally, distributions to the owners do not cause additional income to the owners.

  C Corporation

The situation is different for a "C" corporation.  "C" corporations also make distributions by paying dividends. However, the payment of dividends by a "C" corporation results in the "double taxation" problem.

-  The business income of a "C" corporation is taxed at the corporate level.

-  If dividends (distributions) are paid by the "C" corporation, there are two consequences:

*  First, the corporation is not allowed to deduct the payment of the dividends in determining its net income.

*  Second, the dividends received by the owners are taxable income to the owners.

-  Thus, the income of a "C" corporation is taxed once when the corporation pays tax on its income, and then again when the dividends are paid to the owners who must report such income on their personal returns (i.e., double taxation).

It is evident that this double taxation problem is a deterrent from making distributions of dividends from a "C" corporation.  In some cases, it may be possible for a "C" corporation to avoid double taxation by making distributions to owners in the form of increased salaries, directors fees, or lease payments (for equipment or facilities owned by an owner and leased to the business).  Because such distributions are deductible in computing the corporation's income (unlike the payment of dividends), such income is only taxed once, that is, at the individual level.

This factor of making distributions is not equally important for all businesses.  A manufacturing business may have a high need for capital, and as a result, the owners may expect to withdraw very little of the business income for the direct benefit of the owners.  Instead, the owners may choose to leave the income in the business so that it can be used to help finance expansion of the business.  On the other hand, a business that is less capital intensive, perhaps a service company, may wish to distribute substantial amounts of its income to the owner(s).

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 FRINGE BENEFITS

 NUMBER OF OWNERS

 OTHER FACTORS

 OWNER PREFERENCES

 SOLE PROPRIETORSHIP

 TAXATION OF BUSINESS INCOME


 Limited Liability

 Owners of sole proprietorships and general partnerships are liable for all of the debts and expenses of the business, that is their liability is "unlimited".  The owners of corporations and limited liability companies enjoy limited liability, that is their liability is limited to the amount of capital that they contribute to the business.  A limited partnership is somewhat of a hybrid -- the general partner has unlimited liability (and the right to manage the partnership) and the limited partners have limited liability (but no participation in management decisions).

Some protection against "unlimited" liability can be obtained through appropriate liability insurance, although some kinds of liability may be uninsurable.

For more information, see:

 "C" CORPORATION

 GENERAL PARTNERSHIP

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 OTHER FACTORS

 "S" CORPORATION

 SOLE PROPRIETORSHIP

 TAXATION OF BUSINESS INCOME


 Number of Owners

 By definition, a sole proprietorship is limited to one owner.  Partnerships (general and limited) and limited liability companies must have at least two owners, and the total number of owners is unlimited.  An "S" corporation may have only one owner, but it may not have more than 35.  A "C" corporation has the most flexibility; it may have any number of owners.

For more information, see:

 GENERAL PARTNERSHIP

 LIMITED PARTNERSHIP

 OTHER FACTORS

 OWNER PREFERENCES

 "S" CORPORATION

 SOLE PROPRIETORSHIP


 Fringe Benefits

 A "C" corporation generally can deduct the costs of group health insurance plans, pension plans, and limited amounts of life insurance.  The costs of these benefits for owner/employees are deductible if certain tax regulations are followed which discourage plans that primarily benefit highly compensated employees (who are often the officers and/or owners of the business).  "S" corporations, partnerships, and limited liability companies can only deduct the costs of benefits provided to non-owners.  In the case of an "S" corporation, a stockholder who owns less than 2% of the company's stock is a "non-owner".  A sole proprietor is even more limited in deducting these types of fringe benefits.

For more information, see:

 DISTRIBUTIONS TO OWNERS

 OTHER FACTORS

 OWNER PREFERENCES


 Other Factors

 A corporation ("C" or "S") has perpetual existence, i.e., the corporation continues in existence even though the owner(s) may die.  A general partnership terminates if a partner withdraws or dies, but this result can be altered through the use of a partnership agreement that provides for the continuation of the business upon the death or withdrawal of a partner.  Limited partnerships and limited liability companies terminate after a term of years which is specified in the limited partnership agreement or the operating agreement of the limited liability company.  A sole proprietorship terminates with the death of the sole proprietor.

 Tax Year

A "C" corporation is allowed to select a fiscal year for its tax year, i.e., it is not required to use a December 31 year-end.  All other business entities must use a calendar year-end, although there are some limited exceptions.  The selection of a fiscal year may be important if the business activities are seasonal and the end of a normal business cycle occurs at a time other than December 31.

 Sole Proprietor Ownership

The sole proprietor is the sole owner of the business and the business ceases upon the death or disability of the owner.  The business may be sold to another party either by the sole proprietor during his or her lifetime, or by the sole proprietor's legal representative upon death or disability.

 Partnership Interests

A partner can assign the partner's interest in the partnership to another party.  However, the receiving party cannot act as a partner unless the other partners consent. The partnership agreement may also impose other restrictions on transfers of interests.

  Corporation Ownership

Ownership of a corporation is represented by shares of stock which can be transferred to others.  In a small or "closely held" corporation, the shares may be subject to an agreement which restricts or prohibits the transfer of the shares as a means of controlling  who may own shares in the business. Although continuity of the business despite the death of a shareholder is an advantage of the corporate form, as a practical matter, in a small or "closely held" corporation, the death or withdrawal of a shareholder who is also a key employee of the corporation may result in the termination of the business of the corporation.  Advance planning in the form of stock redemption agreements or buy-sell agreements is important to consider for the continuity of the corporation.

  Interests of Limited Liability Company Member

Similar to a partnership, most limited liability company (LLC) statutes require that a member cannot transfer his or her interest to another person without the consent of ALL of the other members.

For more information, see:

 BUSINESS ENTITY PLANNING WORKSHEET

 "C" CORPORATION

 DISTRIBUTIONS TO OWNERS

 FRINGE BENEFITS

 GENERAL PARTNERSHIP

 LIMITED LIABILITY

 LIMITED LIABILITY COMPANY

 LIMITED PARTNERSHIP

 NUMBER OF OWNERS

 OWNER PREFERENCES

 "S" CORPORATION

 SOLE PROPRIETORSHIP

 TAXATION OF BUSINESS INCOME


 Corporate Proxy

 In the corporate context, the term "proxy" has two meanings. First, it refers to a person who is given the authority to represent, vote and exercise the powers associated with the stock owned by the person who designates the proxy (the "Stockholder").  Second, the term "proxy" also refers to the document under which the stockholder gives the power to the person who will represent the stockholder.  Thus, a proxy document is actually a special power of attorney.  In many cases, the proxy is given to another stockholder.

For more information, see:

 DESIGNATION OF AUTHORITY

 DURATION OF PROXY


 Duration of Proxy

Generally, a designation of proxy is given to the Proxy with respect to just one stockholders meeting.  Usually the reason for the proxy is because the stockholder does not plan to attend the meeting in person, but wants to make sure that his or her shares are voted at the meeting.  Sometimes, other shareholders actually solicit proxies from other shareholders.  The reason may be that the soliciting stockholder wants to control more votes, or it may simply be that if not enough stockholders are present at the meeting (in person or by proxy), the stockholders will be unable to conduct business at the meeting because of a failure to meet the corporation's quorum requirement.  The program allows the Stockholder to give a proxy for an unspecified period of time, but generally this is not done.  If a Stockholder desires to give another person voting power for an extended period of time, it is recommended that an attorney be consulted regarding the possibility of creating a voting trust, a document not offered by this program.

For more information, see:

 CORPORATE PROXY

 DESIGNATION OF AUTHORITY

 QUORUMS AND PROXIES


 Designation of Authority

Generally, a designation of proxy is given for one stockholders meeting, and the Proxy is given full power to vote the shares in the Proxy's discretion or in accordance with an informal oral arrangement between the Stockholder and the Proxy.  However, the Stockholder may wish to require the Proxy to vote a certain way on one or more specific issues.  For example, if directors will be elected at an annual stockholders meeting, the Stockholder may wish to require the Proxy to vote for certain directors.  Or, there may be a key issue that will be decided, and the Stockholder wants to make sure that the Proxy votes "for" or "against" as the case may be.  This program's proxy document is designed to allow the Proxy full discretion to vote on all issues, although the Proxy may be required to vote "for" or "against" on specific issues.  Unless the Proxy can vote on all issues properly raised at the meeting, the Stockholder's shares (as represented by the Proxy) could be challenged as "not being present" for quorum purposes.

For more information, see:

 CORPORATE PROXY

 DURATION OF PROXY

 QUORUMS AND PROXIES


 Signature - Corporate Proxy

1. 	The Corporate Proxy should be signed by the stockholder (by both stockholders, if the stock is jointly owned). Although a witness to the signing is not required in many states, it is advisable to have the signing of the Proxy document witnessed by a disinterested party (someone other than the Stockholder(s) or the Proxy) in order to provide added assurance that the Proxy document will  withstand a challenge to its validity.

2. 	It is advisable to sign two copies of the Proxy so that one copy can be presented by the proxy holder at the stockholders meeting, and one copy can be retained by stockholder. Original copies should be kept in a fire-proof and safe location.

3. 	The Proxy will be effective as specified in the document, either (i) until terminated by written notice, or (ii) for a specific meeting. Therefore, the Proxy will continue in effect until written notice is provided to the corporation. The Proxy should be reviewed from time to time to make sure that it is appropriate for it to continue in effect.

4. 	An attorney should be consulted regarding any unique issues not addressed by this program.

For more information, see:

 CORPORATE PROXY

 DURATION OF PROXY

 QUORUMS AND PROXIES


 Employment Documents

The employment area of the law is complex in many ways. Some of the important issues include:

- whether the worker is an  employee or independent contractor.

- the impact of  minimum wage/overtime laws on the payment of wages and/or  commissions.

- the impact of the  Americans With Disabilities Act.

This program provides documents that address these issues, including an Employment Agreement, a Consulting Agreement, a Work for Hire Agreement, an Employment Confirmation Letter and an Employment Letter of Acceptance.  Additionally, a Confidentiality Agreement and a Non-Compete Agreement, both of which may be used between companies or in an employer/employee relationship, are available through this program.

For more information, see:

 CONFIDENTIALITY AGREEMENT

 CONSULTING AGREEMENT

 EMPLOYMENT AGREEMENT

 EMPLOYMENT CONFIRMATION LETTER

 LETTER OF ACCEPTANCE

 NON-COMPETE AGREEMENT

 WORK FOR HIRE AGREEMENT

 DOCUMENT INFORMATION TOPIC LIST


 Employee or Independent Contractor

 Generally, an "employee" is a person who is hired by another person or business (an "employer") for a wage or fixed payment in exchange for personal services and who does not provide the services as part of an independent business. This definition can be contrasted with an "independent contractor" who is a person or entity who, as part of an independent business, becomes obligated to provide goods and/or services for a price.  For example, an expert in computer systems might provide services to other businesses as a "consultant".

The IRS has very strict guidelines concerning whether a person providing services is an employee or an independent contractor.  Frequently, businesses attempt to make their associations with workers "independent contractor" relationships so that they are not obligated to provide employee benefits or to withhold employee payroll taxes. However, the IRS often views such relationships as "employer/employee" relationships in order to assess payroll taxes against the employer.  If one or more of the following factors apply, there is a reasonable possibility that the IRS will view the "worker/consultant/independent contractor" as an employee.  In such cases it is advisable to consult a tax expert to determine whether the  Employment Agreement should be used instead of the  Consulting Agreement or the  Work for Hire Agreement.

 Independent Contractor

* 	The independent contractor will work only for the business (the "Company") who is hiring the independent contractor.

* 	The independent contractor will be paid an hourly, weekly, or monthly wage.

* 	The Company will control or significantly influence the independent contractor's working hours and/or work environment.

* 	The Company will control or significantly influence the independent contractor's work methods, and is not merely interested in the results of the independent contractor services.

* 	The Company furnishes tools and equipment required by the independent contractor to perform the services.

* 	The independent contractor is not providing the services as part of a business that is at risk as to whether it will make a profit or suffer a loss.

* 	The relationship of the independent contractor to the Company includes other factors that are similar to factors that characterize the relationships of employees to employers.

The existence of one of the factors by itself may not be determinative, but it will be considered along with other factors by the IRS in deciding which relationship is more dominant.  However, the primary issue in determining the distinction between an employee and independent contractor is whether the Company maintains the right to control the manner and means by which the worker accomplishes the desired result.

For more information, see:

 COMMISSIONS

 CONSULTANT CONFIDENTIALITY

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT DOCUMENTS

 INTELLECTUAL PROPERTY

 MINIMUM WAGE/OVERTIME LAWS

 NON-COMPETITION PROVISION

 PAYMENT TO CONSULTANT

 TERMINATION OF EMPLOYMENT


 Minimum Wage/Overtime Laws

 Minimum wage or overtime laws may have an effect on compensation.  The Employment Agreement and the employment letters do not address the requirements of minimum wage or overtime law.  Wage payments and commission payments to employees must comply with the requirements of the Fair Labor Standards Act, a federal law that sets forth rules regarding wages, working hours, and other employer/employee matters.  For example, some types of employees must be paid at least twice per month.  In addition, many states also have laws regulating minimum wage and overtime pay.  In some cases, state law is more restrictive than federal law.  For additional information, contact an attorney or the local office of the "wage and hour" division of the U.S. Department of Labor (or similar state agency).

For more information, see:

 COMMISSIONS

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT DOCUMENTS

 NON-COMPETITION PROVISION

 PAYMENT TO CONSULTANT


 Americans With Disabilities Act

 Beginning on January 1, 1992, the Americans With Disabilities Act prohibits all public entities (and private businesses from discriminating in their employment practices.  Employers must reasonably modify their policies, practices and procedures to avoid discrimination against qualified individuals with disabilities.  The application of the Act may vary depending on the number of employees working for the employer.

Employers must make "reasonable accommodation" for the known mental and physical limitations of otherwise qualified applicants or employees with disabilities.  "Reasonable accommodation" means any change or adjustment to a job or work environment that permits a qualified applicant or employee with a disability to (i) participate in the job application process, (ii) perform the essential functions of a job, or (iii) enjoy benefits and privileges of employment equal to those enjoyed by employees without disabilities. Examples include:

*  Buying or modifying equipment.

*  Changing the job.

*  Modifying work schedules.

*  Making the work place accessible.

There are exceptions if the employer can show that the accommodation would impose an "undue hardship".  This term means significant difficulty or expense relative to the operation of the employer's business.  If a particular accommodation results in "undue hardship", other alternatives must be considered.  Before concluding that a particular accommodation would create an undue hardship, an attorney should be consulted to determine whether the denial of the accommodation may violate the law.

The purpose of the Act is to protect qualified individuals from discrimination on the basis of a disability.  Whether a particular individual is covered by the Act requires a careful analysis of whether the person is "an individual with a disability" and whether the person is "qualified."

Before any action is taken by an employer with respect to a disabled individual, an attorney should be consulted to avoid any violation of the Act or any other law which applies to disabled persons.

For more information, see:

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT DOCUMENTS

 MINIMUM WAGE/OVERTIME LAWS


 Commissions

 "Commissions" are compensation paid to an employee (e.g., a salesperson) or an  independent contractor (perhaps also a salesperson).  The commission is usually an amount calculated as a percentage of the worker's production.  For example, a salesperson's commission is often a percentage of the salesperson's sales volume.  A commission plan should be in writing and should clearly set forth limitations on the amount of commissions that can be earned, and the circumstances under which commissions will be paid.

For more information, see:

 AMERICANS WITH DISABILITIES ACT

 EMPLOYMENT DOCUMENTS

 MINIMUM WAGE/OVERTIME LAWS

 PAYMENT TO CONSULTANT


 Employment Agreement

The Employment Agreement is an agreement between an employer and employee that specifies the rights and obligations of each party to the agreement.  Please note the following cautions:

- If the employer expects the employee to abide by the agreement, the employer must also follow the agreement.

- Do not use this document if the employee is covered by a collective bargaining agreement (i.e., an agreement negotiated between a labor union and an employer).

- Lawsuits by employees against employers with respect to employment matters are increasing.  Such suits are based on employment agreements, in addition to other matters such as injuries and discrimination (e.g. age, race, sex).  Many aspects of these lawsuits are ambiguous and uncertain because they are based on an oral contract--the employment terms were not made in writing.  Although a written agreement will not eliminate the possibility of a lawsuit, it helps reduce the possibility because it reduces uncertainty.

- Employment laws vary from state to state and change as courts interpret the law through court decisions. This program will help clarify the employment relationship by presenting the typical issues.  An attorney should be consulted regarding any unique issues not addressed by this program.

The Employment Agreement should be signed by both parties and becomes effective as of the date inserted at the beginning of the Agreement.

For more information, see:

 AMERICANS WITH DISABILITIES ACT

 COMMISSIONS

 CONSULTANT CONFIDENTIALITY

 CONSULTING AGREEMENT

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT CONFIRMATION LETTER

 EMPLOYMENT DOCUMENTS

 INTELLECTUAL PROPERTY

 LETTER OF ACCEPTANCE

 MINIMUM WAGE/OVERTIME LAWS

 NON-COMPETE AGREEMENT

 PAYMENT TO CONSULTANT

 TERMINATION OF EMPLOYMENT

 WORK FOR HIRE AGREEMENT


 Employment Confidentiality

 The Employment Agreement offers a confidentiality paragraph that obligates the employee to protect and not disclose the employer's proprietary or confidential information. "Confidential information" is information that is unique, and for which there would be harm if it was disclosed.  The confidentiality paragraph includes an option that specifies the employer's rights to take action with respect to actual or potential disclosures.  Another option allows for the continuation of the confidentiality provisions after  termination of employment. Court decisions vary from state to state, and in some cases, may impose a reasonable time limit regarding the time period for which the employer's information must be kept confidential.  The confidentiality limitations should be reasonable in light of state law requirements and the needs and practices of the employer's business and industry.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT DOCUMENTS

 NON-COMPETITION PROVISION


 Termination of Employment

 The termination paragraph of the Employment Agreement specifies the amount of notice that must be given if either party wishes to terminate the agreement.  In addition, the amount of compensation to which the employee will be entitled (if terminated) can be stated.  This program allows the agreement to provide for employment "at will" which means that either the employer or employee can terminate the employment relationship at any time, with or without notice.  For more information regarding the implications of an employer's failure to clearly maintain an employee in an "at will" status, an attorney should be consulted.   A termination made by an employer should be conducted under the advice of an attorney familiar with particular facts of the case.  A termination that is handled inappropriately might provide the basis for a discrimination or other employment lawsuit.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT DOCUMENTS


 Non-Competition Provision

 The Employment Agreement, Consulting Agreement, Non-Compete and Work for Hire Agreement offer "non-compete covenants" that provide some protection against the possibility that the knowledge gained by the employee (or consultant) regarding the employer (or the company hiring the consultant) will not be used in the future to compete with the employer (or the company).

Some states, including Alabama, California, Colorado, Hawaii, Louisiana, Montana, Nevada, North Carolina, North Dakota, South Dakota, Oklahoma, Oregon, and Wisconsin have significant restrictions on the enforceability of non- compete provisions.  Therefore, it is advisable to consult an attorney before including a non-compete provision. These provisions are only enforceable for a "reasonable" period of time and in a "reasonable" geographical area.  A reasonable period of time is usually limited to two to five years.  A reasonable geographical area depends significantly on the geographical area in which the employer (or company) operates.  An attorney should be consulted if a long period of time or a broad geographical area will be included in non-compete provisions.

The "non-compete" provisions, together with additional options, are provided in a separate document, the  Non-Compete Agreement.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT CONFIDENTIALITY

 INTELLECTUAL PROPERTY

 TERMINATION OF EMPLOYMENT

 EMPLOYMENT DOCUMENTS


 Non-Compete Agreement

 The Non-Compete Agreement is an agreement under which one party (the "Non-Competing Party") agrees not to compete with another party (the "Protected Party").  The need for this type of agreement can arise in a number of contexts. Several examples include (i) business parties that are terminating their working relationship, (ii) a buyer (the Protected Party) who is purchasing a business from its current owner (the Non-Competing Party), and (iii) an employer/employee relationship that is being terminated.  In such cases, the Protected Party may wish to obtain covenants from the Non-Competing Party to the effect that the Non-Competing Party will not (i) engage in a similar business, or (ii) solicit the Protected Party's customers or employees.

As background information, the Non-Compete Agreement should explain why the Agreement is being made.  For example:

The Non-Competing Party is currently an employee of the Protected Party, but the employment relationship is being terminated.  As provided in this Agreement, it is desired by both parties that the Non-Competing Party should not compete with the Protected Party's business or solicit the Protected Party's customers or employees.

In some cases, the employer may have already obtained some protection from competition by including a  Non-Competition Provision in an employment agreement.

Note: Non-compete provisions that are intended to apply to a terminated employee are not enforceable by statute (in most cases) in Alabama, California, Colorado, Hawaii, Louisiana, Montana, Nevada, North Carolina, North Dakota, Oklahoma, Oregon, South Dakota, and Wisconsin.  An attorney should be consulted before using this document in any of these states.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT DOCUMENTS

 NON-COMPETE CONFIDENTIALITY

 NON-COMPETE PAYMENT

 NON-SOLICITATION PROVISION


 Non-Solicitation Provision

 The Non-Compete Agreement includes a "non-solicitation" covenant.  This covenant provides some protection against the possibility that the Non-Competing Party might try to use customer information and contacts with employees of the Protected Party to compete with the Protected Party. Although this may not ensure that the Non-Competing Party will not try to circumvent these provisions by acting in a secretive manner, it does provide at least a "warning" to the Non-Competing Party.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT DOCUMENTS

 NON-COMPETE CONFIDENTIALITY

 NON-COMPETE PAYMENT

 NON-COMPETITION PROVISION


 Non-Compete Payment

 A payment to the "Non-Competing Party" under a Non-Compete Agreement is necessary in order for the agreement to be enforceable.  The amount of the payment should be reasonable when compared to the loss of the "ability to compete" that is being made by the Non-Competing Party.  In many cases, a substantial payment will not be required.  However, if the Non-Competing Party's ability to "earn a livelihood" is affected significantly, the payment amount will need to be more substantial.

When a "non-compete" provision is included as a part of an employment agreement or consulting agreement, a separate payment for the "non-compete" provision is not required. However, in this "stand alone" Non-Compete Agreement, the Non-Competing Party is not bound by the agreement unless the Non-Competing Party is receiving something (i.e., a payment).

For more information, see:

 CONSULTING AGREEMENT

 EMPLOYMENT AGREEMENT

 EMPLOYMENT DOCUMENTS

 NON-COMPETE AGREEMENT

 NON-COMPETITION PROVISION

 WORK FOR HIRE AGREEMENT


 Non-Compete Confidentiality

 The Non-Compete Agreement offers a confidentiality paragraph that obligates the Non-Competing Party to protect and not disclose the Protected Party's proprietary or confidential information.  "Confidential information" is information that is unique, and for which there would be harm if it was disclosed.  Court decisions vary from state to state, and in some cases, may impose a reasonable time limit regarding the time period for which the Protected Party's information must be kept confidential.  The confidentiality limitations should be reasonable in light of state law requirements and the needs and practices of the Protected Party's business and industry.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT DOCUMENTS

 NON-COMPETE AGREEMENT

 NON-COMPETE PAYMENT

 NON-COMPETITION PROVISION

 NON-SOLICITATION PROVISION

 TERMINATION OF EMPLOYMENT


 Employment Confirmation Letter

 The Employment Confirmation Letter may be used by an employer who has verbally discussed the terms and conditions of employment with the potential employee and wants to confirm that discussion in writing.  The employer should confirm what was said immediately after the final interview and prior to the time that the employee accepts the job offer.  Wage payments to employees must comply with  minimum wage/overtime laws. If the employee accepts the offer, it is highly recommended that the employment terms be formalized in an employment agreement.

For more information, see:

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT AGREEMENT

 EMPLOYMENT DOCUMENTS

 LETTER OF ACCEPTANCE

 NON-COMPETE AGREEMENT

 WORK FOR HIRE AGREEMENT


 Letter of Acceptance

 The Letter of Acceptance (i) confirms the employee's understanding regarding the terms and conditions of the employer's oral offer of employment and (ii) accepts the offer of employment.  This letter, which specifies the rate of compensation, vacation time, sick/personal days, benefits, and reimbursement for expenses, helps reduce the possibility of a misunderstanding.  It is highly recommended that the employment terms be formalized in an employment agreement.

For more information, see:

 CONSULTING AGREEMENT

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT AGREEMENT

 EMPLOYMENT DOCUMENTS


 Consulting Agreement

 A Consulting Agreement is a document under which a consultant (someone who gives expert or professional advice) agrees to provide professional or consulting services. Under this agreement, the "consultant" is an independent contractor with respect to the "company", and not an employee of the "company".  This document allows the user to substitute any term for the term "consultant", and thus, this document can be adapted to many other situations that might involve an independent contractor.

The Consulting Agreement should be signed by both parties and becomes effective as of the date inserted at the beginning of the Agreement.  For specific information regarding the employee/independent contractor distinction, review the "Employee or Independent Contractor" topic.

For more information, see:

 AMERICANS WITH DISABILITIES ACT

 COMMISSIONS

 CONSULTANT CONFIDENTIALITY

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT DOCUMENTS

 INTELLECTUAL PROPERTY

 MINIMUM WAGE/OVERTIME LAWS

 NON-COMPETE AGREEMENT

 NON-COMPETITION PROVISION

 PAYMENT TO CONSULTANT

 TERMINATION OF EMPLOYMENT

 WORK FOR HIRE AGREEMENT


 Payment to Consultant

 It is not unusual for a consultant, an independent contractor, or a person working under a  Work for Hire Agreement to provide services based on an hourly charge.  However, if payment (based on the hourly charge) is made weekly or biweekly, the IRS may view such an arrangement as indicating an employer/employee relationship.  It is recommended that you read about the IRS guidelines in the  "Employee or Independent Contractor" topic.

For more information, see:

 AMERICANS WITH DISABILITIES ACT

 COMMISSIONS

 CONSULTANT CONFIDENTIALITY

 CONSULTING AGREEMENT

 EMPLOYMENT DOCUMENTS

 MINIMUM WAGE/OVERTIME LAWS

 NON-COMPETE AGREEMENT

 NON-COMPETITION PROVISION


 Intellectual Property

 The  Consulting Agreement includes an optional paragraph that provides protection to the Company with respect to copyrights, patents, inventions, and other intellectual property.  Such property could include novels, sound recordings, a new type of mousetrap, or a cure for a disease.

This paragraph allows for the possibility that the Consultant already has rights to certain intellectual property that will remain with the Consultant.  With respect to intellectual property developed during the term of the agreement, this paragraph allows for the allocation of the rights to (i) the Company, (ii) the Consultant, or (iii) the Consultant, with the right of the Company to use the property.

The  Work for Hire Agreement includes a similar paragraph which is entitled "Work Product Ownership".  This paragraph simply provides that the Company will be the owner of any ideas or products that are developed through the efforts of the Service Provider.

For more information, see:

 CONSULTANT CONFIDENTIALITY

 EMPLOYEE OR INDEPENDENT CONTRACTOR

 EMPLOYMENT AGREEMENT

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT DOCUMENTS

 NON-COMPETE AGREEMENT

 NON-COMPETITION PROVISION

 TERMINATION OF EMPLOYMENT


 Consultant Confidentiality

 The  Consulting Agreement includes an optional paragraph that obligates the Consultant (or independent contractor) to protect and not disclose the Company's proprietary or confidential information. "Confidential information" is information that is unique, and for which there would be harm if it was disclosed.  For more information regarding confidential information, read the  "Employment Confidentiality" topic.

A company can protect it's confidential information by prohibiting a consultant from working for other parties during the term of the Agreement.  However, this type of "bar" is a factor that the IRS uses in determining whether the Consultant/Company relationship may be an employment relationship rather than an independent contractor relationship.  For more information, read the  "Employee or Independent Contractor" topic.  Alternatively, the Consultant is permitted to work for other parties, with an admonishment to abide by the duty to protect confidential information.

The  Work for Hire Agreement includes a similar but less detailed provision that simply obligates the Service Provider to protect the Company's confidential information.  This provision also includes an optional sentence that requires the Service Provider to return the Company's records.

For more information, see:

 EMPLOYMENT AGREEMENT

 EMPLOYMENT DOCUMENTS

 INTELLECTUAL PROPERTY

 NON-COMPETE AGREEMENT

 NON-COMPETITION PROVISION

 TERMINATION OF EMPLOYMENT


 Work for Hire Agreement

 The Work for Hire Agreement is a document under which a "Service Provider" contracts to provide services for a "Company".  Under this agreement, the Service Provider is an  independent contractor with respect to the Company, and not an employee of the Company.  This Agreement should not be used if the Service Provider is really an employee of the Company.  In many respects, the Work for Hire Agreement is simply a short-form version of the  Consulting Agreement. The Work for Hire Agreement should be signed by both parties and becomes effective as of the date inserted at the beginning of the Agreement.

For more information, see:

 AMERICANS WITH DISABILITIES ACT

 COMMISSIONS

 CONSULTANT CONFIDENTIALITY

 EMPLOYMENT AGREEMENT

 EMPLOYMENT CONFIDENTIALITY

 EMPLOYMENT CONFIRMATION LETTER

 EMPLOYMENT DOCUMENTS

 INTELLECTUAL PROPERTY

 LETTER OF ACCEPTANCE

 MINIMUM WAGE/OVERTIME LAWS

 NON-COMPETE AGREEMENT

 NON-COMPETITION PROVISION

 PAYMENT TO CONSULTANT

 TERMINATION OF EMPLOYMENT


 Confidentiality Agreement

 A Confidentiality Agreement is an agreement under which a party ("Recipient") agrees to maintain confidentiality regarding proprietary information (  "Confidential Information" ) that it receives from another party ("Information Owner").  This type of agreement may be useful in a variety of contexts.  For example, two companies might choose to share information for the purpose of determining whether the company with marketing expertise could help a manufacturing company better market its products. In such a situation, the manufacturing company would probably be sharing product and customer information with the marketing company and would want to protect this information from disclosure by the marketing company to third parties.

As an example, the Confidentiality Agreement might state the relationship between the parties as follows:

Example:  Information Owner is engaged in the business of manufacturing computer widgets.  Recipient is a marketing firm that specializes in marketing computer products. Information will be disclosed to Recipient to enable the parties to determine whether Recipient could assist Information Owner with the development of a marketing plan.

Proprietary -- belonging to someone; for example, a company's customer list is proprietary information of the company.

For more information, see:

 CONSULTING AGREEMENT

 EMPLOYMENT DOCUMENTS

 FREE-FORM PARAGRAPH

 GENERAL PROVISIONS

 LIMITED LICENSE

 NO OBLIGATIONS

 NO WARRANTY

 PROTECTION OF INFORMATION

 RETURNING THE INFORMATION


 Confidential Information

 Confidential Information includes any information or material that is proprietary to the Information Owner. Specifically listing certain types of documents or information reminds the parties of what types of information may be sensitive and important to the Information Owner.  It is customary for agreements to provide that information obtained from other sources regarding the Information Owner is not protected under the agreement.

For more information, see:

 CONFIDENTIALITY AGREEMENT

 CONSULTING AGREEMENT

 GENERAL PROVISIONS

 LIMITED LICENSE

 PROTECTION OF INFORMATION

 RETURNING THE INFORMATION


 Protection of Information

 The Recipient agrees to protect the Confidential Information.  Sometimes this protection is enhanced by limiting the Recipient's authority to make copies, permitting the Recipient to disclose the information only to the Recipient's employees who have an important reason for needing to know the information, and by allowing the Information Owner to obtain an injunction if it appears that the Recipient may disclose the information.

For more information, see:

 CONFIDENTIAL INFORMATION

 CONFIDENTIALITY AGREEMENT

 FREE-FORM PARAGRAPH

 GENERAL PROVISIONS

 LIMITED LICENSE

 NO OBLIGATIONS

 NO WARRANTY

 RETURNING THE INFORMATION


 Returning the Information

 The Information Owner can also attempt to further protect the Confidential Information from disclosure by requiring that any written materials be returned upon request.


 No Obligations

 A Confidentiality Agreement's purpose is to provide protection to the Information Owner.  It is not intended to create a business relationship between the Information Owner and the Recipient, or to imply that either party will be obligated to do business with the other.  To avoid that possible implication, it is common to include a "no obligation" paragraph that specifies the parties' intentions to not become obligated to each other.

For more information, see:

 CONFIDENTIAL INFORMATION

 CONFIDENTIALITY AGREEMENT

 FREE-FORM PARAGRAPH

 GENERAL PROVISIONS

 LIMITED LICENSE

 NO WARRANTY

 PROTECTION OF INFORMATION

 RETURNING THE INFORMATION


 No Warranty

 There is a possibility that the  Confidential Information could contain mistakes or errors, or be based on assumptions that later prove to be incorrect.  Therefore, it is common for Information Owners to include a "no warranty" provision that specifies that the Information Owner will not be responsible for any damages that the Recipient might incur from using the Confidential Information.

For more information, see:

 CONFIDENTIALITY AGREEMENT

 FREE-FORM PARAGRAPH

 GENERAL PROVISIONS

 LIMITED LICENSE

 NO OBLIGATIONS

 PROTECTION OF INFORMATION

 RETURNING THE INFORMATION


 Limited License

 Generally, the Information Owner and the Recipient intend that the  Confidential Information will only be used by the Recipient for the limited purpose of reviewing the information and becoming familiar with the Information Owner's business to determine whether the parties might have interest in future transactions (based on some additional agreement).  A "limited license" provision makes it clear that the Recipient is not acquiring the right to use the Confidential Information on a general basis.

For more information, see:

 CONFIDENTIALITY AGREEMENT

 FREE-FORM PARAGRAPH

 GENERAL PROVISIONS

 NO OBLIGATIONS

 NO WARRANTY

 PROTECTION OF INFORMATION

 RETURNING THE INFORMATION


 General Provisions

 A Confidentiality Agreement should include provisions that (i) require amendments (changes) to the agreement to be in writing, signed by both parties, (ii) specify the state whose laws will govern and interpret disputes between the parties regarding the matters covered by the agreement, and (iii) prohibit the parties from assigning their obligations under the agreement to third parties.  Generally, the state whose laws should govern the agreement should be the state of the Information Owner or the Recipient.

For more information, see:

 CONFIDENTIAL INFORMATION

 CONFIDENTIALITY AGREEMENT

 FREE-FORM PARAGRAPH

 LIMITED LICENSE

 NO OBLIGATIONS

 NO WARRANTY

 PROTECTION OF INFORMATION

 RETURNING THE INFORMATION


 Free-Form Paragraph

 This program provides a "free-form" paragraph that allows the user to add additional provisions that may be unique to the user's specific situation.


 Personal Fact Sheet

 This is not a formal document.  It is a worksheet to document personal data and to organize your financial information.  Optional sections include a summary of assets and liabilities, a summary of insurance policies, and a  free-form paragraph. The final document should be stored in a location where the person who may become responsible for your affairs would expect to find such information.

In addition to the organization of your financial matters, this document may be useful to your spouse or other family members if you become incapacitated or upon your death.  It contains the type of information needed if another person is required to manage your financial affairs, such as a Conservator appointed by a court, or your Agent as designated under a Power of Attorney.  Also, this document contains the type of information that a lawyer or an executor would need for the administration of an estate.

You may want to review the program before entering the data to see the types of information that the program requests. Have copies of your records available to facilitate entering the information.  Also, consider the order in which you desire to enter the requested data.

For more information, see:

 ACCOUNTS/STOCKS/BONDS

 BUSINESS INTERESTS

 FAMILY PERSONAL

 INSURANCE SUMMARY

 LOANS/LIABILITIES

 PERSONAL INFORMATION

 REAL ESTATE

 SAFETY DEPOSIT BOX

 VEHICLES/PERSONAL PROPERTY/OTHER ASSETS

 WILLS/HEALTH CARE DIRECTIVES/POWERS OF ATTY


 Wills/Health Care Directives/Powers of Attorney

 Various legal documents specify an individual's instructions if such person is unable to act on his or her own behalf. Also, an individual may appoint someone to act as his or her agent in specified instances or upon the occurrence of specified events.

  Simple Will

A Simple Will is a document under which a Willmaker states his or her intentions regarding the persons or entities ("beneficiaries") who will receive the Willmaker's property, and the person or entity ("Executor") who will carry out the Willmaker's wishes.

  Living Trust

A Living Trust is a trust created by a person (known as the "Grantor") for use during that person's lifetime. Typically, the Living Trust includes provisions that provide distributions of the trust income to the Grantor during the Grantor's lifetime.  After the death of the Grantor, the Living Trust has provisions that designate beneficiaries who will receive the Grantor's property, similar to a Simple Will.  The Grantor generally manages the trust during the Grantor's lifetime, as the  "Trustee" ; after the death of the Grantor, a Successor Trustee carries out the remaining terms of the Living Trust, much in the same manner as an Executor.

  Pour Over Will

A Pour Over Will is a specialized will that is used as a supplementary document to the Living Trust.  Its primary function is to "pour over" the Willmaker's remaining assets (at the Willmaker's death) into the Willmaker's Living Trust.  The Pour Over Will should only be used if a Living Trust has been prepared.

  Living Will

A Living Will is a document under which a competent adult, prior to becoming unconscious or incompetent, declares his or her intention that life-sustaining procedures should be withheld or withdrawn under specified circumstances.  The Living Will should not be confused with the Simple Will or the Living Trust.  The Living Will is related to the Health Care (Durable) Power of Attorney document.

 Health Care (Durable) Power of Attorney

A Health Care (Durable) Power of Attorney is a document which allows an individual ("Principal") to designate another individual ("Agent") to make health care decisions for the Principal if the Principal is unconscious, incompetent or otherwise unable to make such decisions.  The document may also contain wishes and desires to guide the Agent in making health care decisions for the Principal.

  Power of Attorney

A Power of Attorney is a document under which a person (a "Grantor") authorizes another person or entity (an Attorney-in-Fact" or "Agent") to act on his or her behalf. The Agent will be able to handle the Grantor's affairs during a period of time when the Grantor is unavailable or unable to do so.  A General Power of Attorney authorizes the Agent to act in a variety of situations.  In contrast, a Special Power of Attorney authorizes an Agent to act on his or her behalf in specific situations only.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 LIVING TRUST

 LIVING WILL

 PERSONAL FACT SHEET

 POWER OF ATTORNEY

 SIMPLE WILL


 Safety Deposit Box

 A safety deposit box is a metal container rented by a customer in a bank in which the customer deposits important papers, securities and other valuable items.  Generally, two keys are required to open the box, one retained by the bank and the other by the customer.

In the event of incapacity or death, family members will need to have access to important documents stored in the box.  Therefore, it is important to identify the banks at which the deposit boxes are located and the location of the keys. If the keys are not located, a charge will be made to "drill" the safety deposit box.

Also, upon death, the safety deposit box is "sealed" and an inventory of the boxes' contents is made by bank personnel in conjunction with the Executor.  Once an Executor is appointed, the executor may have access to the box upon proof of such appointment.  If the box is held jointly with another individual, that individual may subsequently have access to the safety deposit box.

If no Executor or Administrator is appointed for the estate, a bank will generally allow a family member access to the safety deposit box upon the execution of an indemnity agreement.  Such an agreement generally states the person taking control of the box contents will be responsible if anyone later makes a claim against the bank for releasing the box contents.

For more information, see:

 ACCOUNTS/STOCKS/BONDS

 BUSINESS INTERESTS

 INSURANCE SUMMARY

 LOANS/LIABILITIES

 PERSONAL FACT SHEET

 REAL ESTATE

 VEHICLES/PERSONAL PROPERTY/OTHER ASSETS

 WILLS/HEALTH CARE DIRECTIVES/POWERS OF ATTY


 Accounts/Stocks/Bonds

 A complete listing of all bank, IRA, and investment accounts, as well as stocks and bonds is very helpful.  This type of listing not only organizes your financial matters, it has the potential of saving your family an immense amount of time and frustration in locating this type of information.  Information regarding your various retirement/profit sharing plans is also important.

Cash accounts, IRA accounts, and retirement plans should be listed at their current values.  Of course, the values of these accounts will change over time, but the current value provides a "snapshot" of your current financial position.

Investment accounts, stocks and bonds should be valued at their current market value, not their original cost. However, the purchase price is required when these types of assets are sold in order to calculate the capital gain or income earned.

Many employee benefit plans, IRAs and other accounts contain beneficiary designations.  A beneficiary is the person or entity entitled to receive the value of the account when the owner dies.  It is important to understand that the designated beneficiary will receive the value of the account, even if this is in conflict with the terms of the owner's Will.  In other words, the designation of the beneficiary takes priority over the terms of the Will.

For more information, see:

 BUSINESS INTERESTS

 INSURANCE SUMMARY

 LOANS/LIABILITIES

 PERSONAL FACT SHEET

 REAL ESTATE

 SAFETY DEPOSIT BOX

 VEHICLES/PERSONAL PROPERTY/OTHER ASSETS

 WILLS/HEALTH CARE DIRECTIVES/POWERS OF ATTY


 Real Estate

 Real estate may be difficult to value.  However, appraisals for property tax purposes, and the recent sales of similar real estate in the same area can be useful in estimating the fair market value.  Refer to the deed or other document of transfer to verify exactly how the ownership (title) of the property is held.  The legal description of the real estate may be obtained from a deed, real estate contract, loan documents, or other real estate records.

For more information, see:

 ACCOUNTS/STOCKS/BONDS

 BUSINESS INTERESTS

 INSURANCE SUMMARY

 LOANS/LIABILITIES

 PERSONAL FACT SHEET

 SAFETY DEPOSIT BOX

 VEHICLES/PERSONAL PROPERTY/OTHER ASSETS

 WILLS/HEALTH CARE DIRECTIVES/POWERS OF ATTY


 Insurance Summary

 The various insurance sections will assist you in establishing and maintaining an up-to-date listing of your motor vehicle, homeowners (or renters), life, health, disability insurance, and other insurance coverage.  Locate and have copies of current policy declaration pages available to assist in the entering of the appropriate data.

It is also important to review the beneficiary designations for all of your life insurance policies.  A beneficiary is the person or entity entitled to receive the insurance proceeds when the owner dies.  It is important to understand that the designated beneficiary will receive the insurance proceeds, even if this is in conflict with the terms of the decedent's Will.  In other words, the designation of the beneficiary takes priority over the terms of the Will.

For more information, see:

 ACCOUNTS/STOCKS/BONDS

 BUSINESS INTERESTS

 LOANS/LIABILITIES

 PERSONAL FACT SHEET

 REAL ESTATE

 SAFETY DEPOSIT BOX


 Business Interests

 Any interest in a business other than a corporation may be listed in this section.  For example, an investment in a joint venture with another person, or ownership in a sole proprietorship  or partnership.  Business assets, including accounts and real estate, should be listed separately from personal assets or accounts.  If the business holdings are extensive, you may want to prepare a separate summary for the business itself.

For more information, see:

 ACCOUNTS/STOCKS/BONDS

 INSURANCE SUMMARY

 LOANS/LIABILITIES

 PERSONAL FACT SHEET

 REAL ESTATE

 VEHICLES/PERSONAL PROPERTY/OTHER ASSETS


 Vehicles/Personal Property/Other Assets

 A complete asset listing includes motor vehicles and items of personal property such as household furnishings, electronic equipment, appliances, collections, jewelry, and antiques.  Each vehicle should be listed separately. However, personal property and household furnishings may be listed as a single item with a total estimated value. Special or unique items of personal property may be listed separately.

For more information, see:

 INSURANCE SUMMARY

 LOANS/LIABILITIES

 PERSONAL FACT SHEET


 Loans/Liabilities

 A true financial picture must contain loans, debts and other liabilities.  Debts should be listed at an amount equal to the current outstanding principal amount.  For example, the amount of a mortgage should be the current principal balance.  Credit cards should be listed at the current outstanding balance.  It is not necessary to list monthly bills such as rent payments and utility bills.

For more information, see:

 BUSINESS INTERESTS

 PERSONAL FACT SHEET

 REAL ESTATE

 VEHICLES/PERSONAL PROPERTY/OTHER ASSETS


 Memorial Services

 The purpose of this document is to leave instructions regarding your desires for your final arrangements.

A  funeral or memorial service can be a moving, personal ceremony.  So that you may have the kind of remembrance that you want, provide a copy of this document to your family or other appropriate person(s) and discuss your desires with them.  If you do not wish to discuss your wishes with your family, at least advise your family or other appropriate person(s) regarding the location of this document.

Realistic planning may be difficult for an event that may not take place for many years, and of necessity plans must be made on a tentative basis.  Circumstances may require that changes be made in your plans.  If you provide guidance to your family, and yet indicate that you understand that changes may need to be made, they will feel more comfortable in making your arrangements.

If you are inclined to make prearrangements, again be aware that circumstances may necessitate changes.  Specifying too many details and instructions may be counterproductive. Sometimes it is best to base the decision on the circumstances known at the time of death.

For more information, see:

 AUTOPSY (MEMORIAL SERVICES)

 BIOGRAPHICAL INFORMATION

 CASKET/CONTAINER SELECTION

 DONATION/ANATOMICAL GIFTS

 WILLS AND ESTATE PLANNING

 FLOWERS/MEMORIAL FUNDS

 FUNERAL HOME/DIRECTOR

 NOTIFICATION

 OTHER WISHES

 PALLBEARERS

 PERSONAL INFORMATION

 PREPAID FUNERAL PLANS

 PROTECTIVE FUNERAL LEGISLATION

 TREATMENT OF THE BODY


 Notification

 A number of alternatives are available to notify individuals and institutions of a death.  Many times the immediate notification of the Declarant's clergy person permits such person to assist the bereaved family and friends.

Family and close friends are telephoned immediately.  If desired, this program's "Exhibit" document can be used to list everyone who should be notified.  Or, you may refer to a list or other form that contains such names, such as an address book.  Newspaper announcements can be used to notify a larger number of acquaintances.  Formal printed announcements, usually used by businesses to inform colleagues or clients, are sometimes sent.

In addition to family and friends, there will be others who need to be informed of the death.  For example, banks, credit card companies, and organizations.   The  "Personal Fact Sheet" identifies important information which can be used to ascertaining who should be notified.

For more information, see:

 BIOGRAPHICAL INFORMATION

 MEMORIAL/FUNERAL SERVICE

 MEMORIAL SERVICES


 Funeral Home Director

 You may want to discuss these funeral arrangements with your funeral director.  If you want to make selections and desires known to your funeral director, the information generated by this program can assist you in that discussion. Leave a copy of your wishes with your funeral director for future reference.

Some funeral homes and memorial parks offer prepaid funeral plans.  If you make prearrangements, choose a reliable funeral director (one whose business will still be in existence at the time of your death).  Also, you should be sure that your funds are paid into a state-regulated trust fund.  This assures that the funds are available when they are needed.  Verify how this fund is handled and what happens to your prepayment if the funeral director's business is sold or the director goes out of business.

If such a plan is chosen, you should be sure to attach proof of such purchase to this document.  A description of pre-need arrangements will be necessary to assure that your loved ones know you have already paid for certain items.  As you make your plans, find out if adjustments can be made at the time of your death.  Some pre-need plans permit you to transfer the arrangements from one funeral home/cemetery to another.  You should also ascertain if a pre-purchased lot can be transferred or sold if circumstances change.

For more information, see:

 MEMORIAL SERVICES

 PROTECTIVE FUNERAL LEGISLATION


 Donation/Anatomical Gifts

 Making a gift of your body can be done by several methods: a bequest of particular organs for transplantation, donation of all organs and tissues, or the donation of the entire body to a medical school.  Alternative disposition preferences should also be made if the donation cannot be completed for any reason.

Donor cards are available from local agencies such as hospitals, the local office of the National Kidney Foundation, or a community eye bank.  Some states provide organ donation check-off on driver's licenses.  Also inform family members or close friends to assure fulfillment of your desires.  To donate the whole body, the school or hospital to which such donation will be made should be contacted.  The institution will advise of their particular procedure and can provide the necessary forms.

The dissection of human bodies is an invaluable part of medical school training and scientific research.  A donor form may indicate whether the Declarant prefers his/her body be used for anatomy classes or for scientific research.  Bodies generally are rejected if they are decomposed, obese, emaciated, amputated, infectious, mutilated, have been recently operated on, autopsied, or are otherwise unfit.  With the exception of corneas, organ donations cannot be made if the body is to be donated to science.

 Cost of Donation

The cost of donating a body to medical science may include a minimal fee for transportation of the body.  Some schools will pick up the body.  Donation of a body to science is the most economical disposition of a body.  A special embalming process is required.  The body is kept from six months to two years.  Upon completion of medical studies the remains are generally cremated.  Some schools will return the body or cremains, sometime charging for any costs incurred.

 What Parts of Body May Be Donated

Donations can be made of a variety or organs: liver, heart, kidneys, bones and tissue (including cartilage, marrow, skin, eardrums, and corneas).  Human tissues include other eye parts, blood vessels, ligaments, tendons and other connective tissue, pituitary glands, the dura mater and other brain tissues, middle ears, ear bones, heart valves, and other organ subparts.

Two physicians with no interest in the transplant must find the patient "utterly and irretrievably deceased". After being declared brain dead, the organ donor is placed on a respirator until the organs are removed.

For more information, see:

 AUTOPSY (MEMORIAL SERVICES)

 CASKET/CONTAINER SELECTION

 MEMORIAL SERVICES

 TREATMENT OF THE BODY


 Treatment of the Body

 This section concerns the selection of a final resting place for the body or remains.  Survivors can visit this place to mourn or reflect in a quiet, contemplative setting.  Burial plots may be purchased from cemeteries, churches, memorial parks, cooperative groups as well as governmental bodies. Above ground burial or entombment is also an option.  A mausoleum tends to serve not only as a burial place, but also as a monument to the deceased individual or family.

  Cremation

Cremation is the reduction of the body to minerals through intense heat.  The ashes and bone fragments that remain after cremation are called "cremains."  These cremains are placed in an urn or other container for burial, storage, or scattering.  Most states allow cremains to be scattered if the bone fragments in the cremains have been pulverized. Ask a funeral director or crematorium about the local rules.

Cremains may also be placed in a columbarium, a structure adorned with stained glass windows and other aesthetic embellishments, containing small chambers for cremated remains.  The door behind which an urn is placed may be marked with a bronze plaque bearing the name of the deceased.

  Embalming

Embalming involves injecting a dead body with chemicals to retard decay.  Routine embalming is generally not required by state law.  However, death from a communicable/contagious diseases or transportation by a common carrier requires embalming in some states.  The type of embalming used to delay funeral arrangements for several days does not preserve a body much beyond that time.

Funeral providers are required by the Federal Trade Commission Funeral Rule to provide information about embalming so that a consumer can make an informed decision on whether to purchase this service.  The funeral provider must:

1.  Disclose in writing, that except in certain special cases, embalming is not required by law.

2.  Not falsely state that embalming is required by law.

3.  Not represent that embalming is required for direct cremation, immediate burial, a funeral using a sealed casket, or if refrigeration is available and the funeral is without viewing or visitation, and with a closed casket when State or local law does not require embalming.

4.  Disclose that you usually have the right to choose an arrangement that does not require embalming such as direct cremation or immediate burial.

5.  Disclose that certain funeral arrangements, such as a funeral with viewing, may make embalming a necessity.

6.  Not charge for embalming if it has not been authorized and it is not required by state law.

7.  Provide a written explanation of the reason for embalming where a charge has been imposed.

For more information, see:

 CASKET/CONTAINER SELECTION

 DONATION/ANATOMICAL GIFTS

 MEMORIAL SERVICES

 PROTECTIVE FUNERAL LEGISLATION


 Memorial Funeral Service

 Funeral ceremonies are for those who survive the death, and this should be taken into consideration as plans are made. Visitation with family and friends and viewing the body is an opportunity to accept the finality of death, pay last respects and say good-bye.  If visitation is chosen, embalming is generally required.  A service, whether or not the body is present, offers the opportunity for family, friends, neighbors, and associates to gather and support the bereaved and each other.

This simple gathering is one of the most important psychological and emotional needs that is satisfied by the funeral.  It is the community's way of letting others know that despite the loss of a loved one, they do not have to face the loss alone.  Psychologically, the funeral is healthy for the immediate family and closest friends.  The activities associated with the funeral effectively illustrate for all the reality of death and provide a coping mechanism.

The type of memorial service planned can vary greatly and is a matter of personal taste.  Music, prayer, remarks, songs reflect traditional procedure.  A series of short talks by friends and relatives of the deceased may be comforting. The Declarant may want to indicate preferences for these items, such as favorite musical selections, scriptures or other readings, and preferred speakers.

For more information, see:

 FLOWERS/MEMORIAL FUNDS

 MEMORIAL SERVICES

 OTHER WISHES

 PALLBEARERS

 PROTECTIVE FUNERAL LEGISLATION

 TREATMENT OF THE BODY


 Flowers/Memorial Funds

 Flowers may provide comfort to the survivors.  Flowers are an integral part of a traditional memorial service from the visitation, memorial service, and to the final resting place.  Some people prefer that the money otherwise spent on flowers be contributed to a particular charity, church, or nonprofit organization.  The names of such organizations can be printed in the death notice.

For more information, see:

 MEMORIAL/FUNERAL SERVICE

 MEMORIAL SERVICES


 Casket Container Selection

 Despite commonly accepted ideas that the material of the casket will determine the price, there is great variety of prices within each of the various types of materials.  It is rather difficult to specify a type of casket without actually viewing the caskets.  The appearance of the casket, and its sealing capabilities are the characteristics generally considered in making a purchase.

  Representations Regarding Natural Decomposition

Funeral providers are prohibited from representing that funeral goods or services will delay the natural decomposition of human remains for a long or indefinite time.  For example, funeral providers may not claim embalming or a particular type of casket will indefinitely preserve the deceased's body.  Also a funeral provider may not represent that items have protective features or will protect the body from water, dirt, or other gravesite substances unless the claim can be substantiated.

  Sealing Capabilities of Outer Burial Containers

Some manufacturers test the sealing capabilities of their caskets and outer burial containers and provide a written warranty evidencing these characteristics.  Although it may seem highly unlikely that anyone would ever make a claim on a casket warranty, such a warranty may be an indication of the quality of the product.  This written warranty is made by the manufacturer, and is made available by the funeral provider.

  Laws Regarding Outer Burial Containers

The Federal Trade Commission Funeral Rule prohibits a funeral provider from representing that state or local laws or particular cemeteries require outer burial containers if that is not the case.  Also, the provider must make the following disclosure:

In most areas of the country, no State or local law makes you buy a container to surround the casket in the grave. However, many cemeteries ask that you have such a container so that the grave will not sink in.  Either a burial vault or a grave liner will satisfy these requirements.

  Burial Vault or Grave Liner

A burial vault is a large tank, usually concrete but sometimes metal or fiberglass, which is lowered by machine into a gravesite excavation; after the coffin is placed inside, a lid is added.  There is no significant effect on body preservation.  A grave liner may be sufficient and less expensive.

  Direct Cremation

For direct cremation a rigid combustible container is required.  Direct cremation is the cremation of the body without a viewing or other ceremony at which the body is present.  Rosewood, mahogany, pine or cloth-covered caskets are suitable for cremation.  Also, the funeral provider may not state that the law requires a casket for direct cremation, and is required to offer an inexpensive alternate container.  An alternate container is a non-metal receptacle, without ornamentation or affixed interior lining, which is made of cardboard, pressed-wood, canvas, or other combustible materials.

For more information, see:

 MEMORIAL SERVICES

 OTHER WISHES

 PROTECTIVE FUNERAL LEGISLATION

 TREATMENT OF THE BODY


 Pallbearers

 Many funeral homes will provide personnel to carry the casket from the chapel or funeral home to the hearse and from the hearse to the grave site or crematory.  There may be an extra charge for this service.  A designation of pallbearers from relatives and friends is a recognition of close friendship to the decedent.  In some locations, such as New York City, paid professional pallbearers are required by the pallbearers union unless you can obtain a waiver.

For more information, see:

 MEMORIAL/FUNERAL SERVICE

 MEMORIAL SERVICES

 OTHER WISHES

 PROTECTIVE FUNERAL LEGISLATION


 Other Wishes

 In this section, the Declarant may indicate whether or not he/she desires the scheduling of visitation hours, a marker, or any other items.  For example, the Declarant may want to specify burial attire.  The Declarant may also state which newspapers should be contacted to publish an obituary.

Memorial stones and statues may not be allowed in some cemeteries.  There may also be restrictions on personal memorials, such as the placement of flowers, urns, vases, or the lighting of candles at graveside.  A cemetery should provide printed information describing their decoration policy and any other restrictions.

The federal government will provide a free bronze or granite marker for a deceased veteran.  The local Veteran's Administration office or funeral director will have information on how to obtain the veteran's marker.

For more information, see:

 FLOWERS/MEMORIAL FUNDS

 MEMORIAL FUNERAL SERVICE

 MEMORIAL SERVICES


 Prepaid Funeral Plans

 These are contracts which outline an individual's plan for burial.  These plans may include a variety of options but generally identify the casket, burial vault, or other items to be included in the funeral arrangements.  These plans allow for prepayment of the casket and other items that an individual specifies or may allow more generally for a specific amount of money to be spent for a funeral.  In some instances, prepaid plans may be designated as a Certificate of Deposit or another type of restrictive account which names the funeral home as the beneficiary of the account.  These plans may be revocable or irrevocable.

For more information, see:

 CASKET/CONTAINER SELECTION

 FLOWERS/MEMORIAL FUNDS

 MEMORIAL FUNERAL SERVICE

 MEMORIAL SERVICES

 PROTECTIVE FUNERAL LEGISLATION


 Protective Funeral Legislation

 Most state regulatory bodies supervise funeral providers and some states have protective legislation for consumers.  In addition, the Federal Trade Commission Funeral Rule requires that certain information be provided to consumers in a clear and conspicuous manner.  This rule applies to pre-need as well as arrangements made at the time of death.

1.  You can obtain the cost of individual items by telephone in order to compare prices among funeral providers.

2.  When you inquire about funeral arrangements in person, the funeral home is required to give you a written price list of the goods and services offered for sale.  Some funeral homes wait until you ask for this list even though federal law requires that it be provided at the beginning of the meeting.  Do not hesitate to request a price list.

This list must include at least the price of embalming, transportation of remains, use of facilities, caskets, outer burial containers, immediate burials, or direct cremations. This price list will state if professional services for arranging and supervising a funeral are not included in the prices.  The price list also provides disclosures regarding embalming, cash advance sales (such as newspaper notices or flowers), caskets for cremation and required purchases.

3.  You may purchase individual items or a package of goods and services.

4.  When inquiring about a casket or alternate container, or an outer burial container, the funeral provider must supply a list or a use a notebook, brochure or chart that describes all the available selections, their prices, and the effective date of the price list.

5.  The funeral provider must give you an itemized statement containing the total cost of the goods and services selected, the prices for each, including itemized cash advance items (or a good faith estimate with actual charges provided before the final bill is paid).  This statement will also disclose any legal cemetery or crematory requirements that necessitate the purchase of any specific good or service.  You can then decide if you want to add or delete items.

  Charging for "Cash Advance Item"

The Federal Trade Commission Funeral Rule requires that funeral providers disclose whether they charge a fee for providing a "cash advance item".  In other words, if the funeral provider pays for any item on your behalf, and adds a service fee or receives a refund, discount or rebate from the supplier, this must be disclosed.  Examples of cash advance items are:  cemetery or crematory services; pallbearers; public transportation; clergy honoraria; flowers, musicians or singers; nurses; obituary notices; gratuities and death certificates.  If the price of a cash advance item is not known at the time arrangements are made, a good faith estimate must be included in the itemized statement of goods and services and the actual charges must be provided before the final bill is paid.

It is illegal for a funeral provider to require certain additional items in connection with the purchase of any item except as required by a cemetery, crematory or by law.  The funeral provider must not falsely represent that items are required.  If legal or other requirements necessitate the purchase of items you did not specifically request, the funeral provider must disclose in the Statement of Goods and Services Selected the specific requirement necessitating the purchase of the item.

If you have questions about the laws of your state, you may contact the licensing board that regulates the funeral industry in your state.  If you have a problem concerning funeral matters, first attempt to resolve it with your funeral director.  If you are dissatisfied, contact your local consumer protection agency or the following organizations:

Conference of Funeral Service Examining Boards

520 East Van Trees Street

P.O. Box 497

Washington, Indiana 47501

Telephone: (812) 254-7887

ThanaCAP

135 West Wells Street, Suite 600

Milwaukee, WI  53203

Telephone:  (414)276-9788

For more information, see:

 MEMORIAL/FUNERAL SERVICE

 MEMORIAL SERVICES

 PREPAID FUNERAL PLANS


 Biographical Information

 Public announcement of a death can be accomplished by publications in local newspapers.  A death notice is a paid announcement listing pertinent information.  An obituary is a news story printed in the newspaper, generally at no cost.  Sometimes a newspaper will print basic information at no charge, and then charge for anything in addition to the basic information.

These notices must be quickly prepared to meet newspaper deadlines.  To assist family or other appropriate person(s) in writing an obituary, many types of information will be required.  The program provides for the type of information that is most generally requested.  Additional information may be added as desired.  Some people prefer to prepare their own obituaries.  This program's "Exhibit" document can be used for this purpose.  The information should then be attached to the Memorial Services document.

For more information, see:

 MEMORIAL SERVICES

 NOTIFICATION


 Personal Information

 To assist your family or other appropriate person(s) in handling your estate, many types of information will be required whether or not your estate is  probated. Also it is a good idea to keep a list of all the property you own outright or have an interest in, as well as stocks and bonds, accounts, savings and checking, and the financial institutions where they are located.  It is also important to list the liabilities you have, such as bank loans, mortgages, personal loans, etc., for these will also be important in settling your financial affairs.  An option is presented within the "Memorial Services" document for you to prepare a list of biographical information.  A copy of financial and personal information should be kept with your Memorial Plans.  You should inform your family or other appropriate person(s) of the location of this information. This program offers a "Personal Fact Sheet" document to assist with the preparation of your personal information.

Such a comprehensive personal-planning effort on your part has several benefits:

A.   It gives you an opportunity to review your own financial situation;

B.   It simplifies arrangements for your survivors who must handle them;

C.   It saves time and energy and may save money that your survivors may have to otherwise spend to settle matters after your death;

D.   It can give you a sense of pride in having your affairs in order.

This planning effort, however, is not a substitute for a Will.  This information, though, is helpful in addition to your Will.  Family Lawyer provides a "Simple Will" for an estate less than $450,000.  If your matters are more complex, the "Estate Planning Worksheet" can identify the questions that you should review before seeing an attorney to prepare your Will.  (NOTE:  An explanation of the "Estate Planning Worksheet", a "Simple Will" and other information related to estate planning can be found under the Wills and Trusts section).

For more information, see:

 MEMORIAL SERVICES

 PERSONAL FACT SHEET

 WILLS AND TRUSTS


 Wills and Trusts

There are many types of wills and trusts.  This program provides you with the following:

 Simple Will (includes an optional children's trust),

 Living Trust,

 Joint Living Trust,

 Pour Over Will,

 Estate Planning Worksheet,

 Living Will.

  Simple Will

A Simple Will is a document under which a Willmaker states his or her intentions regarding the persons or entities ("beneficiaries") who will receive the Willmaker's property, the person or entity (  "executor" ) who will carry out the Willmaker's wishes, and if necessary, the person ("guardian") who will care for the Willmaker's minor children.

  Living Trust

A Living Trust is a trust created by a person (known as the "Grantor") for use during that person's lifetime. Typically, the Living Trust includes provisions that provide distributions of the income to the Grantor during the Grantor's lifetime.  After the death of the Grantor, the Living Trust has provisions that designate beneficiaries who will receive the Grantor's property, much in the same manner as a Simple Will.  The Grantor generally manages the trust during the Grantor's lifetime, as the  "Trustee"; after the death of the Grantor, a successor Trustee carries out the remaining terms of the Living Trust, much in the same manner as an Executor.

  Joint Living Trust

A Joint Living Trust can be created by a person and that person's spouse.  In some cases, this method is preferable to creating two separate Living Trusts, especially where assets to be contributed are held jointly and could not easily be divided to be placed into two separate trusts. Another advantage is that the joint trust is created in a single document rather than multiple documents.

  Pour Over Will

A Pour Over Will is a specialized Simple Will that is used as a supplementary document to the Living Trust and Joint Living Trust.  Its primary function is to "pour over" the Willmaker's remaining assets (at the Willmaker's death) into the Willmaker's Living Trust or Joint Living Trust.  The Pour Over Will should only be used if a Living Trust or Joint Living Trust has been prepared.

  Estate Planning Worksheet

The Estate Planning Worksheet is not a formal document.  It is a worksheet to be used as a planning document in connection with the preparation of a Simple Will.  It can also be used to prepare for this program's Living Trust and Pour Over Will.  Finally, it requests information that an attorney would use during an estate planning interview, and therefore, it can also be used to prepare for situations that require complex estate planning techniques that are not included in this program's Simple Will and Living Trust.

  Living Will

A Living Will is a document under which a competent adult (a "Declarant"), prior to becoming unconscious or incompetent, declares his or her intention that life-sustaining procedures should be withheld or withdrawn under specified circumstances.  The Living Will should not be confused with the Simple Will, Living Trust or Pour Over Will; the Living Trust is more related to the Health Care (Durable) Power of Attorney document.

  Personal Fact Sheet

In addition to wills, trusts and estate planning worksheet, This program provides a "Personal Fact Sheet" which is useful in organizing and summarizing personal data and financial information.  (NOTE:  An explanation of personal information useful in managing personal and financial matters resulting from disability or death can be found under the  Personal Fact Sheet section).

For more information, see:

 COMPLEX WILLS AND TRUSTS

 WILLS AND ESTATE PLANNING

 ESTATE PLANNING WORKSHEET

 HEALTH CARE POWER OF ATTORNEY

 LIVING TRUST

 JOINT LIVING TRUST

 LIVING WILL

 POUR OVER WILL

 SIMPLE WILL


 Simple Will

 A Simple Will is a document under which a Willmaker states his or her intentions regarding the persons or entities ("beneficiaries") who will receive the Willmaker's property, the person or entity (  "executor" ) who will carry out the Willmaker's wishes, and if necessary, the person ("guardian") who will care for the Willmaker's minor children.

NOTE:  This program provides an appropriate Will for most people.  However, if the estate is larger than $450,000, it may be desirable to use more complex estate planning techniques that are not provided by this program.  For such cases, this program's Estate Planning Worksheet and Simple Will can be used to prepare for an office conference with an attorney who can assist you with the preparation of a more complex will.

For more information, see:

 WILLS AND ESTATE PLANNING

 ESTATE PLANNING WORKSHEET

 JOINT LIVING TRUST

 JOINT PROPERTY

 LIVING TRUST

 RESIDUARY ESTATE

 SIGNING THE WILL

 SPECIFIC BEQUESTS

 SPOUSES

 TANGIBLE PERSONAL PROPERTY

 TRUST FOR CHILDREN

 WILLS AND TRUSTS

 EXECUTOR/PERSONAL REPRESENTATIVE


 Exclusion from the Will

 It is the general practice for a Willmaker to provide for distributions to the Willmaker's family, particularly the Willmaker's spouse (if married) and children (if any), or in the case of a deceased child, such child's children (if any).  Such persons are said to be "the natural objects of the Willmaker's bounty".  If such persons exist but are not included in the Will, a question may arise as to whether the Willmaker simply made a mistake.  Further, such excluded persons may attempt to challenge the Will on this very basis, that is, that the Willmaker simply made an error in excluding them from the Will.  If the Willmaker intends to exclude someone that might expect to be included in the Will, it is advisable to include a statement in the Will that makes it clear that the omission was intentional. Although this type of exclusion generally applies only to individuals, this provision can also be used to list organizations that will be excluded.

For more information, see:

 SIMPLE WILL


 Signing the Will

1. This Will does not dispose of property which passes on the death of the Willmaker to a person by operation of law or by any contract. For example, the Will does not dispose of joint tenancy assets or the Willmaker's spouse's share of community property, and it does not normally apply to proceeds of life insurance on the Willmaker's life or to his or her retirement plan benefits.

2. This Will is not designed to reduce taxes. The tax results of the choices made in this Will should be discussed with a competent tax advisor.

3. This Will is not valid unless it is signed by a Willmaker who is of "sound mind" and of the minimum age for this state. In most states, the minimum age is eighteen. Some states permit an individual below the minimum age to execute a will if the person is married or in the military. Being of "sound mind" requires that the Willmaker (a) know that he or she is executing a will, (b) know the general nature and extent of his or her property, and (c) know the descendants or other relatives that would ordinarily be expected to share in the estate.

4. If the Willmaker is unable to sign due to physical disability, another person may be able to sign on behalf of the Willmaker, in the Willmaker's presence, and at the express direction of the Willmaker. If there are any questions regarding the possibility of someone signing on behalf of the Willmaker, a lawyer should be contacted.

5. The Simple Will should be signed by the Willmaker in the presence of three witnesses and a notary public. Witnesses to this Will must be sixteen years of age or older. Many states require only two witnesses, but the signature of a third witness provides some protection against the possibility that one of the witness' signature will be invalid for some reason. For example, a person should not be a witness if that person is a beneficiary under the Will. In most states, if a beneficiary's signature is counted in order to satisfy the minimum number of witnesses, then the will is not necessarily invalidated, but that "interested witness" may not receive a share of the estate any larger than if the Willmaker had died without a will.

6. All of the witnesses must watch the Willmaker sign this Will. The Willmaker should verbally declare that the document is intended to be his or her Last Will and Testament, but the witnesses need not read the Will or know of its contents.

7. Each witness must sign his or her name with the Willmaker and the other witnesses present. The witnesses should be satisfied that the Willmaker willingly signed the document as his or her free and voluntary act, and that the Willmaker was of full age and sound mind.

8. The Willmaker should initial on the bottom margin of each page of the Will. This is done to prevent the subsequent substitution of pages.

9. The self-proving affidavit is a document which should be attached to the end of the Will, and which contains the testator's acknowledgment and the affidavit of the witnesses, made before a person authorized to take acknowledgments and administer oaths. The affidavit recites that the requisite formalities were observed in executing the Will. Although attaching the affidavit has nothing to do with the legality of the Will itself, it can speed the admission of the Will to  probate after the death of the Willmaker because it eliminates the need to have a witness appear at the probate proceeding to testify that the formalities in executing the Will were followed. The witnesses may not be available later when they are needed. A self-proved will may be admitted to probate without additional witnesses or affidavits, but it is still subject to contest on such grounds as undue influence, lack of testamentary capacity, or prior revocation. In most cases, this affidavit should be executed and attached to the end of the Will. Some states do not recognize the self-proving option: California, Maryland, Michigan, Ohio, Vermont, Wisconsin, and the District of Columbia. Therefore, the affidavit will be of no use in those states. However, including the affidavit in those states will not invalidate the Will.

10. The date should be filled in wherever requested, using the date on which the actual signing takes place. This step could become essential to the validity of the Will (for example, if this Will revokes an earlier Will).

11. The number of total pages in the Will should be indicated, including the page(s) on which the witness signature lines appear. The page with the affidavit, if included, should not be counted because the affidavit is not a part of the Will itself.

12. The original copy of the Will should be kept in a secure location such as a safe deposit box at a bank, because only the signed original can be probated. A second copy could be kept in the Willmaker's home files. The Willmaker may wish to provide a copy to his or her attorney, or possibly to the person named as executor or  trustee. However, before distributing such copies, the Willmaker should consider that it may become awkward to retrieve them later, should the Willmaker decide to modify the Will and/or change the designation of executor or trustee.

13. In most states, the Will cannot be changed by adding, deleting or modifying words on the face of the Will. Such changes are usually disregarded. The Will can be amended by executing a "codicil" to the Will, but this method is not recommended. When changes are desired, it is recommended that the Will be revoked by executing a new will which expressly revokes the former Will. For example, if the Willmaker marries or divorces after the Will is signed, he or she should make and sign a new will.

For more information, see:

 POUR OVER WILL

 SIMPLE WILL

 WILLS AND TRUSTS


 Spouses

 Many states "protect" spouses with laws that permit a spouse to receive a portion of the estate even though the Will does not provide for the spouse.  If the intent in the Will being created by this program is to "disinherit" the Willmaker's spouse, you may want to consult with an attorney regarding the legal rights of the Willmaker's spouse to receive property from the estate, despite the provisions of the Will.  Disinheriting means to deprive another person (an heir) of property that would have been distributed to that person under the laws of intestacy.  An agreement between the Willmaker and the spouse, signed prior to their marriage, may permit the spouse not to be included in the Will.

A similar issue is raised if a Grantor/Willmaker plans to not include a spouse in either the Living Trust or the Pour Over Will.  If these documents are being used as an alternative to the Simple Will, and if the spouse will not be included, it is advisable to consult with an attorney.

For more information, see:

 JOINT PROPERTY

 LIFE INSURANCE/ANNUITY/PENSION PLAN DESIGNATIONS

 SIMPLE WILL

 WILLS AND TRUSTS


 Specific Bequests

 A specific bequest is a gift (bequest) of a specific item or asset to a named person or entity.  For example, a wedding ring, $1,000, an antique, or a car.  The gift can be made in a Will, a Living Trust or a Joint Living Trust.  Some persons (Willmakers or Grantors) have specific items that they want to give to a specific person (or entity).  For example, a mother may want to make sure that her jewelry goes to her daughter.  Or grandparents may decide that they would like to give $1,000 to each of their five grandchildren.  Specific bequests are usually made at the beginning of the Will, followed by other provisions that provide for the distribution of the other assets of the estate.

A specific bequest may be an item of tangible personal property (e.g., a diamond ring), an item of intangible personal property (e.g., 50 shares of IBM stock), or real property (e.g., a personal residence).

For more information, see:

 JOINT LIVING TRUST

 JOINT PROPERTY

 LIVING TRUST

 RESIDUARY ESTATE

 SIMPLE WILL

 TANGIBLE PERSONAL PROPERTY


 Tangible Personal Property

 Tangible personal property includes jewelry, furniture, cars, and other items that have a physical essence. Intangible personal property includes cash accounts, stocks, bonds, and other similar assets.  A coin is tangible personal property, while 25 cents in a checking account is intangible personal property.

Tangible personal property can be given in a Will, a Living Trust or a Joint Living Trust.  Some persons (Willmakers and Grantors) want to make sure that their tangible personal property is given to a specific person or divided among several specific people.  This program allows the user to specifically give tangible personal property to specific beneficiaries, after the user has first decided whether to make specific bequests.  It is not required that the user include specific bequests, but if the user does so, the Simple Will, Living Trust or Joint Living Trust will then exclude any specific bequests of tangible personal property from the provisions that later distribute the tangible personal property. For example, if a Willmaker makes a specific bequest of a "1957 Chevy" to "Uncle Stan", the language of the Simple Will automatically excludes the "1957 Chevy" from the Willmaker's later provision that distributes the tangible personal property to "Aunt Angela".  This language is necessary because the "1957 Chevy" would otherwise be distributed as a specific bequest to one person and as part of the tangible personal property to a different beneficiary.

If the terms of the Simple Will (or Living Trust or Joint Living Trust) provide that the tangible personal property will be distributed to more than one beneficiary, the  Executor (or the  Trustee in the case of a Living Trust or Joint Living Trust) are responsible for determining how the property should be divided.  In most cases, the Executor (or Trustee) will carry out this task by carefully considering the wishes of the beneficiaries who will be receiving the property.

For more information, see:

 JOINT LIVING TRUST

 JOINT PROPERTY

 LIVING TRUST

 RESIDUARY ESTATE

 SIMPLE WILL


 Residuary Estate

 The residuary estate is a term in the Simple Will that is similar to the term "remaining trust assets" that is used in both the Living Trust and the Joint Living Trust.  The residuary estate includes the Willmaker's assets that remain after making distributions of specific bequests and tangible personal property. In most estates (or Living Trusts or Joint Living Trusts) the residuary estate includes most of the assets.  If the optional specific bequests and tangible personal property provisions are not included, the residuary estate includes all of the remaining assets of the Willmaker or Grantor.

  Distribution

This program allows the user to distribute the residuary estate by selecting from a variety of alternatives.  The user can opt to distribute the residuary assets to the Willmaker's spouse or children.  If the Willmaker has minor children, the user can select a Trust for Children.  The user also has the options of distributing the residuary estate to (i) a "named beneficiary" who may be a person (or a charity) other than the spouse or a child, or (ii) several beneficiaries either in "equal shares" or in shares that are stated as "percentages".  This latter option would allow the Willmaker to give 97% of his/her residuary estate to a trust for his/her children and 3% to a favorite charity.

  Contingent Beneficiaries

This program also provides multiple opportunities to provide for "contingent" beneficiaries, beneficiaries who will receive distributions of assets if the first choice does not survive the Willmaker (or Grantor in the case of a Living Trust or Joint Living Trust).  For example, a user can give all of the residuary estate to a spouse as the first choice, but if the spouse does not survive the death of the Willmaker, a user may want to select (i) the "children" option to give the residuary estate to the children in equal shares, (ii) the "multiple beneficiaries" option to give 40% of the residuary estate to one child and 60% to a child with unique needs, (iii) the "equal shares" alternative of the "multiple beneficiaries" option to divide the residuary estate equally among three brothers, or (iv) the "named beneficiary" option to give the residuary estate to an elderly parent (maybe the Willmaker has no children).  This example does not illustrate all of the many options.

In most cases, the user will have the opportunity to provide for several layers of contingent beneficiaries.  If the user does not want to use the many options, this program provides the user with an easy out--choose a primary beneficiary, and then select the "heirs" option to provide that the Willmaker's heirs will be the contingent beneficiary.  If the "heirs" option is selected, no further alternatives will be presented.

For more information, see:

 JOINT LIVING TRUST

 JOINT PROPERTY

 LIVING TRUST

 SIMPLE WILL

 SPECIFIC BEQUESTS

 SPOUSES

 TANGIBLE PERSONAL PROPERTY

 TRUST FOR CHILDREN


 Joint Property

 Many states permit an individual to own property with another individual in a manner known as "joint with rights of survivorship."  In such a case, when the first joint owner dies, the property passes to the second joint owner, irrespective of the first owner's efforts to bequeath the property through his or her will to a third person.

In many cases this never becomes a problem because the joint property is owned between spouses, and the wills of the spouses provide that the property owned by the spouses will be bequeathed to the survivor of them; thus, there is no conflict between the ownership of the joint property and the provisions of the wills.  If the Willmaker owns property with another person "jointly with rights of survivorship" but wants the property to pass to a third person under the Will, an attorney should be consulted.

For more information, see:

 LIFE INSURANCE/ANNUITY/PENSION PLAN DESIGNATIONS

 SIMPLE WILL

 SPECIFIC BEQUESTS

 SPOUSES

 WILLS AND TRUSTS


 Life Insurance/Annuity/Pension Plan Designations

 Life insurance, annuity, and pension plan agreements (and similar agreements) are contracts that permit an individual to name those who will receive the proceeds of such agreements either as primary or secondary beneficiaries. The designations filed with the insurance company control the distribution of the proceeds of these contracts, not the Willmaker's Simple Will, Living Trust, Joint Living Trust or Pour Over Will.  Similarly, IRA accounts often allow the owner to designate a beneficiary who will receive the proceeds of the account upon the death of the owner of the account. Thus, after any drafting of a Simple Will, Living Trust, or Joint Living Trust, the Grantor/Willmaker should review the agreements to make sure that the designations of such agreements correspond to the wishes of the Grantor/Willmaker as set forth in the Simple Will, Living Trust or Joint Living Trust.

For more information, see:

 JOINT PROPERTY

 SIMPLE WILL

 SPOUSES

 WILLS AND TRUSTS


 Living Trust

 A Living Trust (also known as an "inter vivos trust" or a "revocable trust") is a trust created by a person (known as the "Grantor") for use during that person's lifetime.  The fact that the trust becomes effective during the Grantor's lifetime makes the trust an "inter vivos trust." The Living Trusts also includes a provision that allows the Grantor to amend or revoke the trust at any time, thus giving rise to the common name of "revocable trust."

Typically, a Living Trust includes provisions that allow the Grantor, who often serves as  trustee, to manage the assets of the trust until such time as the Grantor (i) becomes "disabled" (unable to manage his or her financial affairs) or (ii) simply prefers to have someone else (perhaps a bank's trust department) manage his or her affairs.  If that occurs, the trust provisions provide for a "successor trustee" to take over the management of the trust.

  Distributions

During the Grantor's lifetime, distributions are made to the Grantor in fixed periodic amounts.  The amount of the distributions can be changed from time to time at the request of the Grantor.

When the Grantor dies, the trust provisions designate the beneficiaries who will receive the Grantor's property, much in the same manner as a Simple Will.  At the option of the Grantor, these provisions include specific bequests, distributions of tangible personal property, and distributions of the remaining trust assets. These provisions can also include a trust share that will be maintained for the benefit of the Grantor's minor children; this trust share serves the same function as the "trust for minor children" in the Simple Will.  For more information, see the  TRUST FOR CHILDREN section.  The successor trustee carries out these provisions in a role similar to that of an  executor.

  Advantages of a Living Trust

The Living Trust is often viewed as a preferable alternative to the Simple Will.  Some of the perceived advantages of the Living Trust relate to privacy, reduced  probate costs, and management of assets.  For more information regarding these advantages, see the  LIVING TRUST ADVANTAGES topic.

  Factors to Consider in Creating a Living Trust

There are several important factors that must be considered in creating and using a Living Trust.

1.   USE OF THIS PROGRAM AS A PLANNING DEVICE.  Creating a Living Trust involves careful planning and consideration. Not all of the steps, including the very important step of transferring assets, can be completed while sitting at a computer. Although this program will guide you through the process of creating a valid Living Trust document, it may be appropriate to contact a lawyer regarding legal questions or a bank trust officer regarding a trust department's ability to serve as a successor trustee.  It is expected that many of this program's customers will use the Living Trust document as a planning tool.  After using this program to draft an initial document and as an educational device, the user may wish to alter the Living Trust document with the aid of legal counsel.

2.   TRANSFER OF ASSETS INTO THE TRUST.  In addition to creating and signing the Living Trust document, assets must be transferred into the trust.  A Living Trust only applies to the assets that are actually transferred into the Trust. For additional information on this very important point, read the  FUNDING THE TRUST topic.

3.   POUR OVER WILL.  The use of a Living Trust does not eliminate the need for a will.  A Grantor may have assets that he or she does not wish to transfer into the Living Trust.  For example, it may be preferable not to transfer some personal property such as vehicles, household and personal effects, and a personal checking account.  A Pour Over Will serves to handle the distribution of such assets by requiring that such assets be transferred to the trustee of the Living Trust for final distribution.  It is highly recommended that a Living Trust not be signed, unless a Pour Over Will is also properly signed by the Grantor.

4.   TAX CONSEQUENCES.  Generally, the income earned by the assets transferred into a Living Trust will be taxable to the Grantor on his or her personal income tax returns in the same manner as if the assets continued to be held personally by the Grantor.

5.   ESTATE PLANNING.  The Living Trust document created using this program, and its companion document, the Pour Over Will, will be appropriate estate planning documents for many situations. However, if the estate is larger than $450,000, it may be desirable to use more complex estate planning techniques that are not provided by this program. For such cases, this program will be beneficial by offering insights into many of the questions that an attorney will ask in preparing a more complex Living Trust.

6.   JOINT LIVING TRUST.  For married couples desiring the advantages of a Living Trust, another alternative is to create a Joint Living Trust.  For additional information, read the  JOINT LIVING TRUST topic.

For more information, see:

 AMENDED LIVING TRUST

 JOINT PROPERTY

 LIFE INSURANCE/ANNUITY/PENSION PLAN DESIGNATIONS

 POUR OVER WILL

 PROTECTION OF BENEFICIARIES

 SIMPLE WILL

 SPECIFIC BEQUESTS

 SPOUSES

 TANGIBLE PERSONAL PROPERTY

 TRUSTEE AND EXECUTOR POWERS

 WILLS AND ESTATE PLANNING

 WILLS AND TRUSTS


 Living Trust Advantages

The Living Trust or Joint Living Trust are often viewed as preferable alternatives to the Simple Will.  Some of the perceived advantages of the Living Trusts are as follows:

1.   PRIVACY.  A Living Trust is more private.  Under state law, a will is admitted to  probate after the Willmaker dies, so that the terms of the will can be administered.  As a result, the will becomes part of the court records that can be inspected by the public upon request. on the other hand, a Living Trust is administered by the successor  trustee, without court involvement, and does not become a public record.  Thus, the terms of the Living Trust, including the identities of the beneficiaries and the manner in which the Grantor's assets will be distributed, remain private knowledge.

2.   REDUCED PROBATE COSTS.  A Living Trust may avoid at least some of the perceived "evils" of the probate process. A Will is subject to a court administered process known as "probate". The probate process includes procedures that (1) determine the validity of the Will, (ii) deal with potential Will challenges, (iii) resolve the claims of creditors of the decedent, and (iv) ultimately distribute title to the decedent's assets to the beneficiaries.  This process takes time (generally, six months to 3 years), and involves court costs,  executor fees, and attorney fees.  The cost of probate can vary greatly, depending on state law; the cost may range from 2% of the amount of the decedent's gross assets to 10% or more in some states.  However, the costs associated with administering the trust assets after a Grantor's death, including the obligation to prepare various tax returns, account for trust assets, pay the Grantor's debts, and make required distributions, may be similar in amount to the costs of probate.  Therefore, it is difficult to predict whether the amount of savings that might result from the use of a Living Trust will be more than a minimal amount.

3.   MANAGEMENT OF PROPERTY.  A Living Trust offers a mechanism for allowing another person or entity to manage all or some of your assets if you are unable to do so, or if you simply prefer to "have someone else do it".  Thus, a Living Trust may serve as an alternative to a conservatorship.

For more information, see:

 AMENDED LIVING TRUST

 FUNDING THE TRUST

 JOINT LIVING TRUST

 JOINT PROPERTY

 LIFE INSURANCE/ANNUITY/PENSION PLAN DESIGNATIONS

 LIVING TRUST

 POUR OVER WILL

 SIMPLE WILL

 WILLS AND TRUSTS


 Funding the Trust

 In addition to creating and signing a Living Trust or Joint Living Trust document, assets must be transferred into the trust.  A Living Trust only applies to the assets that are actually transferred into the trust.  Assets can be transferred both at the time of the creation of the trust and also at later times.  At death, the companion document, the Pour Over Will, transfers the Grantor's remaining property (except joint property) into the trust.

Real estate is transferred into the trust through the use of a "deed".  Investment accounts, including cash accounts and stock accounts in which the stocks are held in "street name" by the brokerage firm, are transferred by appropriately changing the name on the accounts.  Stocks, bonds, and some other types of investments are transferred through the use of a broker or transfer agent.  Property that is jointly held (for example, real estate held jointly by spouses) can be transferred into a Living Trust, but the process may require more careful planning because of the joint ownership.  THIS PROCESS MAY REQUIRE THE USE OF PROFESSIONAL ASSISTANCE, INCLUDING THE ADVICE OF AN ATTORNEY.

For more information, see:

 AMENDED LIVING TRUST

 TRUST FOR CHILDREN

 WILLS AND TRUSTS


 Trust For Children

 The Simple Will, Living Trust and Joint Living Trust documents in this program offer a unique planning opportunity for parents with minor children.  If the spouse does not survive the Willmaker (or Grantor), this program allows you to provide for a trust for the minor children. You can provide that all the residuary estate/trust will go into the trust, or you can provide that a percentage of the  residuary estate will go to a named beneficiary, with the remainder to the trust.  The trust provides for the health, education, maintenance, and support of the children until the youngest child reaches an "adult" age.  Often age 25 years is used because it offers the children an opportunity to attend college and "settle down" before receiving their trust shares.

When the youngest child reaches the specified "adult" age, the trust is divided into equal shares for the children and either (i) immediately distributed, or (ii) distributed in several payments. For example, assume that Bill Willmaker and his spouse Rosie have three children: Justin, age 6; Jenny, age 4; and Joe, age 2. Under the first option, the trust would be maintained until Joe reaches age 25 years (or some other specified adult age).  The trust would then be divided equally among Justin (now age 29), Jenny (now age 27), and Joe (age 25).  The goal is to preserve the trust assets until the youngest child attains "maturity".  Under the second option, Bill Willmaker might specify that the final distribution should be made in three distributions at ages 25 years, 28 years, and 31 years.  Now when Joe attains age 25 years the trust is divided into three equal shares. Justin receives two-thirds of his share (1/3 because he has attained age 25 years and 1/3 because he has attained age 28 years), and Jenny and Joe will each receive one-third of their respective shares.  All three will receive their remaining shares as they attain the appropriate ages.

The trust for children also includes provisions to provide for the possibility that the children will not be living at the time of final distribution of the trust assets.

For more information, see:

 AMENDED LIVING TRUST

 FUNDING THE TRUST

 JOINT LIVING TRUST

 LIVING TRUST

 POUR OVER WILL

 PROTECTION OF BENEFICIARIES

 SIMPLE WILL

 TRUSTEE AND EXECUTOR POWERS

 WILLS AND TRUSTS


 Protection of Beneficiaries

 The Living Trust, Joint Living Trust and the Simple Will documents include a provision for the protection of the beneficiaries.  The purpose of this provision is to prevent the beneficiaries from impoverishing themselves by "selling" or "assigning" their interests in the trusts to third parties.  For example, a 19 year old child might be tempted to "sell" or "trade" all or a portion of his/her interest in a trust for an expensive sports car.  This provision does not prevent the 19 year old from making a deal with the car dealer, but it does prevent the car dealer from enforcing the deal against the trust.  Sometimes these provisions are known as "spendthrift" provisions.

For more information, see:

 AMENDED LIVING TRUST

 JOINT LIVING TRUST

 LIVING TRUST

 POUR OVER WILL

 SIMPLE WILL

 TRUST FOR CHILDREN

 TRUSTEE AND EXECUTOR POWERS

 WILLS AND TRUSTS


 Trustee and Executor Powers

 The Simple Will, Pour Over Will, Living Trust and Joint Living Trust include provisions that grant broad powers to the  Executor and  Trustee to carry out the terms of the Will and Trust.  In the Simple Will, the listing of powers is short and concise if the Will does not include a children's trust. The Pour Over Will includes a simple provision.  If the Simple Will contains a children's trust, and in the case of a Living Trust or Joint Living Trust, the Executor and Trustee powers are more detailed and specific.  Further, in these situations, some optional powers are available so that the user can add powers that may be useful to the user's particular situation.  For example, a Willmaker who owns a business may choose to include a power that permits the Executor and/or Trustee to continue to operate the Willmaker's business (at least for a short period of time) after the Willmaker's death.  In other situations, this power may be irrelevant or undesirable.

For more information, see:

 AMENDED LIVING TRUST

 FUNDING THE TRUST

 JOINT LIVING TRUST

 LIVING TRUST

 POUR OVER WILL

 PROTECTION OF BENEFICIARIES

 SIMPLE WILL

 TRUST FOR CHILDREN

 WILLS AND TRUSTS


 Pour Over Will

 A Pour Over Will is a specialized Simple Will that is used as a supplementary document to the Living Trust or Joint Living Trust.  Its primary function is to "pour over" the Willmaker's remaining assets (at the Willmaker's death) into the Willmaker's Living Trust or Joint Living Trust. NOTE: If a Joint Living Trust has been created, each joint grantor should prepare a Pour Over Will.

A Pour Over Will includes a standard provision that provides for an  Executor (Personal Representative in some states).  It also includes an optional provision to select a Guardian, if the Willmaker has minor children.  Instead of the usual provisions that provide for the distribution of specific bequests, tangible personal property, and the residuary estate, the Pour Over Will simply distributes the Willmaker's remaining assets to his or her Living Trust.  The Living Trust then distributes the remaining property, plus the Trust assets, in accordance with the distribution provisions (specific bequests, etc.) of the Living Trust.

The Pour Over Will should be signed with the same formalities as the Simple Will.

For more information, see:

 WILLS AND ESTATE PLANNING

 JOINT LIVING TRUST

 JOINT PROPERTY

 LIFE INSURANCE/ANNUITY/PENSION PLAN DESIGNATIONS

 LIVING TRUST

 SIGNING THE WILL

 SPOUSES

 TRUSTEE AND EXECUTOR POWERS

 WILLS AND TRUSTS


 Estate Planning Worksheet

 The Estate Planning Worksheet is designed as a worksheet to lead the user through the thought process that is required to prepare a will.  This worksheet can be used for both large and small estates.  If your estate is less than $450,000, this worksheet can be used to prepare you for using this program's Simple Will document.  If your estate is larger than $450,000, you can use this worksheet to prepare for a conference with an estate planning lawyer who will begin by asking for the type of information developed through your use of the Estate Planning Worksheet.  Because this program's Living Trust/Pour Over Will combination is an alternative to the Simple Will, you can also use the Estate Planning Worksheet to prepare for using those documents.

The Estate Planning Worksheet begins by requesting personal information about the Willmaker and the Willmaker's family. Next, the worksheet leads the user through an estimation of the value of the Willmaker's estate.  The third step helps the user sort through the Willmaker's priorities as to what persons or entities (beneficiaries) should receive distributions from the Willmaker's estate.  If the Willmaker has minor children, an optional section is available to work through the questions that form an adequate provision for minor children.  Finally, the worksheet provides some basic information regarding advanced estate planning techniques that might be discussed by an attorney in connection with planning for unique or complex estates.

For more information, see:

 DISTRIBUTION OF ESTATE ASSETS

 WILLS AND ESTATE PLANNING

 ESTATE PLANNING - ESTATE VALUATION

 ESTATE PLANNING - PERSONAL INFORMATION

 ESTATE PLANNING VALUATION OF ASSETS

 MARITAL DEDUCTION AND CREDIT TRUST


 Estate Planning - Personal Information

 The preparation of a will requires basic information regarding the Willmaker.  In addition to the usual "name and address" questions, it is necessary to know the Willmaker's marital status and whether the Willmaker has children. Generally, a spouse and children are high on the Willmaker's list of priorities, but even if they are not, there may be state laws which provide certain rights in favor of the spouse and/or children, regardless of what the Willmaker may attempt to dictate in his/her will.

In addition, a Willmaker's prior marriage may have resulted in financial obligations to support children or a former spouse from the assets of the Willmaker's estate.

There may be unique information about a spouse or children that should be disclosed so that adequate plans can be made.

For example, a handicapped child may have special needs; special planning may be required to best take advantage of government funding that may be available.

For more information, see:

 ESTATE PLANNING WORKSHEET

 SPOUSES


 Estate Planning - Estate Valuation

 The value of the Willmaker's "net estate" is critical information to the estate planner.  A high value, more than $450,000, suggests that more complex estate planning techniques may be required to minimize the tax impact.  The "net estate" is the value of the  Willmaker's assets, minus the Willmaker's debts and  liabilities.  If the Willmaker has a spouse, the estate planner will need "net estate" information for both the Willmaker and the spouse.

The Estate Planning Worksheet gives the user several alternatives in determining the net estate.  First, the Willmaker can simply provide a single amount as the estimated net value of the Willmaker's estate.  This may work well if the Willmaker has only a few assets which can be easily totaled.  However, it can be expected that even in the more simple situations, the estate planner will often request additional information regarding the individual assets.

Second, the user can provide a "summary listing" which provides summary information in general asset categories. This summary will work well in situations where the Willmaker has only one or two items in each asset category.

Third, the Estate Planning Worksheet allows the user to provide a "detailed" listing.  With this option, the user can provide information regarding individual assets in each category.  The primary reason for using this option is to make sure that all of the Willmaker's assets have actually been included.  The extra detail is often not needed by the estate planner.

For more information, see:

 ESTATE PLANNING - VALUE OF ASSETS

 ESTATE PLANNING WORKSHEET

 JOINT PROPERTY


 Estate Planning - Valuation of Assets

 Some general rules should be followed in providing values for assets.  Generally, the assets should be valued at their fair market value, i.e., the value paid by a willing buyer to a willing seller.  Often the fair market value of an asset will be more or less than its cost.  For example, the fair market value of a personal residence is often higher than its cost to the Willmaker.

Note: it is very important to provide accurate information regarding the ownership of the assets.  For example, the "joint" column should only be used to list assets that are jointly owned by the Willmaker and the Willmaker's spouse. If the Willmaker owns property jointly with another person, the Willmaker's share of the joint property should be reported in the Willmaker's column.

  Cash Accounts, IRA's, and Retirement Plans

Cash accounts, IRA accounts, and retirement plans should be listed at their current values.  However, it is important to remember that a retirement plan may increase significantly in value over time.  Investment accounts, stocks, and bonds should be valued at their current market value, not their original cost.  Do not deduct any amount for the cost of commissions that might be required to convert these items to cash.  Information regarding the values of U.S. Savings Bonds can be obtained by contacting a bank or brokerage firm.  If you have more stocks and bonds than what the space of this program provides, combine some of the information before entering the information into the program.

IRA accounts, retirement plans, and some other types of accounts allow the owner to designate a beneficiary.  A beneficiary is the person or entity entitled to receive the value of the account when the owner dies.  It is important to understand that the designated beneficiary will receive the value of the account, even if this is in conflict with the terms of the owner's will.  In other words, the designation of the beneficiary generally takes priority over the terms of the will.  This information is very important for the estate planner.  For additional information regarding beneficiaries, read the topic entitled  "Life Insurance, Annuity, and Pension Plan Designations".

  Real Estate

Real estate may be difficult to value.  However, appraisals for property tax purposes, and the recent sales of similar real estate can be useful in estimating the fair market value.

  Life Insurance

Life insurance policies on the Willmaker, which are also owned by the Willmaker should be listed at the value that will be paid as death benefits.  Generally, this means that the face amount should be listed, not the current value that would be paid if the policy was surrendered to the life insurance company.  Insurance policies on the life of the spouse should be listed as an asset of the spouse.  If the Willmaker owns life insurance on persons other than the Willmaker or the Willmaker's spouse, only the amount that would be received if the policy was surrendered to the life insurance company should be listed.

  Business Interests

Business interests may be difficult to value, but should be at least estimated, based on the assumption that a willing buyer would pay a fair and reasonable price.  Cars and vehicles can be valued using pricing books (sometimes called "blue books") that are available at car dealerships.  As an alternative, you can check the sales listings in your local newspaper to obtain an estimated value.

  Household Furnishings

It is tempting to overvalue household furnishings and personal belongings.  The value listed should be the value that such items would bring if sold as "used" items. Frequently this value is less than the value of such items to the Willmaker who likely paid a much higher price.

  Debts and Liabilities

Debts and liabilities should be listed at an amount equal to the current outstanding principal amount.  For example, the amount of a mortgage should be the current principal balance; credit cards should be listed at the current outstanding balance.  It is not necessary to list current bills such as rent payments and outstanding utility bills.

For more information, see:

 ESTATE PLANNING - ESTATE VALUATION

 ESTATE PLANNING WORKSHEET


 Distribution of Estate Assets

 The Estate Planning Worksheet requests information regarding the Willmaker's priorities as to which persons should receive distributions from the Willmaker's estate.  Often the Willmaker's spouse is the choice to receive the entire estate, even if there are minor children.  The assumption is that the spouse will provide for the needs of the children. However, it is also necessary to provide for the possibility that the Willmaker's spouse will not survive the Willmaker, for example if both are killed in an automobile accident. In such a case, the Willmaker's second priority, often the children, becomes very important.

If the Willmaker has children who are not also the children of the Willmaker's spouse, as in the case of children from a prior marriage, the Willmaker may want to provide for both the spouse and the children as a first priority.  Sometimes there is a child with a unique need which may suggest that a larger share should be provided to that child.  Sometimes the unique need suggests that the distribution should be made through a trust rather than outright, so that a  trustee will be able to monitor the use of the funds.

If the Willmaker does not have a spouse or children, other family members, or perhaps charities, may be a high priority.  Sometimes an elderly parent has special needs that the Willmaker may wish to recognize.

  Specific Bequests

In some cases, the Willmaker may have certain items of property that the Willmaker would like to have distributed to certain people.  For example, it may be important that the Willmaker's wedding ring be distributed to a specific child.  Such items can be handled as specific bequests. Specific bequests are generally listed first in a Will.  The remaining property is then distributed as the residuary estate.

  Distribution Summary

The Estate Planning Worksheet provides an optional "distribution summary".  This summary allows the user to indicate how the Willmaker's estate should be distributed, assuming that all of the intended beneficiaries survive the Willmaker.  This distribution summary is a summary of the  residuary estate. In other words, the distribution summary assumes that specific bequests, if any, have already been made.

For more information, see:

 ESTATE PLANNING WORKSHEET

 LIVING TRUST

 SIMPLE WILL

 WILLS AND TRUSTS


 Marital Deduction and Credit Trust

 The "marital deduction" is a federal tax law that works as follows.  The total amount given to a SURVIVING SPOUSE can be DEDUCTED from the taxable estate in calculating the amount of federal estate tax.  The amount that can be given to a spouse under this rule is unlimited.  Thus, whatever is given by the Willmaker to the Willmaker's spouse (perhaps the entire estate) is tax-free for federal estate tax purposes.

This works fine for the estate of the first spouse to die. However, unless proper planning is used, the marital deduction can cause the loss of the benefit of the Willmaker's "unified credit".  Generally, all taxpayers have a "unified credit" which can be applied as a reduction of the federal estate tax.  By applying the unified credit, federal estate taxes are avoided on the first $600,000 of estate assets.

Note: it is possible for the Willmaker to use up some of the unified credit during his/her lifetime, if substantial gifts are made by the Willmaker.  In such cases, the Willmaker might not have enough unified credit available at the time of the Willmaker's death to protect the full $600,000.

The Problem: if the Willmaker leaves everything to the Willmaker's spouse, the Willmaker's unified credit is simply lost because it is not used--it is not needed because of the unlimited marital deduction.  The issue is then whether there is a way to use the Willmaker's unified credit while still achieving the Willmaker's goal of leaving everything to his/her spouse.

  Credit Trust

The estate planning answer is to use a "credit trust".  This solution results in provisions in the Willmaker's Will that create a credit trust.  In simplified terms, the first $600,000 in assets from the Willmaker's estate is placed in a trust.  The trust includes terms that allow the Willmaker's spouse to receive distributions from the trust during his/her lifetime.  After the spouse's death, the trust assets are distributed to other beneficiaries, perhaps the children.  Because the assets in the trust are not distributed outright to the spouse by the Willmaker's  executor, the trust assets do not qualify for the marital deduction.  However, the Willmaker's unified credit offsets the tax, and there is no federal estate tax in the Willmaker's estate.  Further, the spouse is not required to include the trust assets in his/her estate, and thus the spouse's taxable estate is lower than what it would have been had the Willmaker distributed the "first $600,000" outright to the spouse.  See the following example:

EXAMPLE:  Assume that Mary has assets of $700,000 and her spouse, Joe has assets of $500,000.  If Mary dies first and leaves all of her assets outright to Joe, there will be no tax in her estate because of the unlimited marital deduction.  When Joe dies, he now has $1,200,000.  Joe could protect the first $600,000 by using his unified credit; however, his estate would pay approximately $235,000 on the second $600,000.

However, if Mary includes a credit trust in her Will, the first $600,000 in her estate will go into the trust.  Her unified credit will be sufficient to offset the federal estate taxes.  The remaining $100,000 will pass outright to Joe.  When Joe dies, his estate of $600,000 ($500,000 + $100,000) is also fully protected by the unified credit. Thus, the credit trust provides a savings of $235,000.

This estate planning technique can also be used by adding credit trust provisions to a Living Trust that take effect upon the death of the Grantor.

For more information, see:

 CHARITABLE TRUST

 ESTATE PLANNING WORKSHEET

 GENERATION SKIPPING TAX

 LIFE INSURANCE TRUST

 LIVING TRUST

 MARITAL TRUST

 WILLS AND TRUSTS


 Marital Trust

 A "Marital Trust" (also known as a "QTIP" trust) is a trust that is sometimes created under a Willmaker's will (or Living Trust), in addition to a "Credit Trust".  Generally, a trust does not qualify for the marital deduction.  That characteristic works to the advantage of the Willmaker with respect to the Credit trust which helps the Willmaker avoid taxes on the first $600,000 in estate assets.

However, to avoid taxes on the remaining assets by using the unlimited marital deduction, the Willmaker's remaining assets will need to be distributed outright to the spouse, absent an appropriate exception.  In many cases, the Willmaker's intent is to distribute the remaining assets to the spouse, and so further planning may not be necessary.

In some cases, however, the Willmaker would like to use a trust for the remaining estate assets, primarily so that the Willmaker can control the distribution of the assets after the death of the spouse.  A Marital trust allows the Willmaker to create a trust for the benefit of the Willmaker's spouse that qualifies for the "marital deduction".  Thus, with respect to the assets in excess of $600,000, the Willmaker can both (i) avoid taxes because of the unlimited marital deduction, and (ii) control the ultimate distribution of the assets by using a trust.

For more information, see:

 CHARITABLE TRUST

 ESTATE PLANNING WORKSHEET

 GENERATION SKIPPING TAX

 LIFE INSURANCE TRUST

 MARITAL DEDUCTION AND CREDIT TRUST

 WILLS AND TRUSTS


 Generation Skipping Tax

 Some persons have attempted to reduce the burden of estate taxes by making distributions of significant assets to their grandchildren, rather than their children.  By doing so, the assets are included in the estates of the grandparents and the grandchildren, but not in the estates of the children. This technique might be very acceptable, if the children do not need the assets.

However, the advantage of using this technique is limited by the "generation skipping tax".  This tax is imposed on transfers by a person to grandchildren and other similar relatives ("skip persons" in federal tax parlance) who are deemed to be more than one generation removed from the person under federal tax law.  Generally, each person has a $1,000,000 exemption, which means that a person can make transfers to "skip persons" that total $1,000,000 for all such transfers before the general skipping tax takes effect.

Persons who contemplate making significant gifts to grandchildren and other "skip persons" should consult an attorney regarding planning techniques that may be available to minimize or eliminate the effect of the generation skipping tax.

For more information, see:

 CHARITABLE TRUST

 ESTATE PLANNING WORKSHEET

 LIFE INSURANCE TRUST

 MARITAL DEDUCTION AND CREDIT TRUST

 MARITAL TRUST

 WILLS AND TRUSTS


 Life Insurance Trust

 A Life Insurance Trust is a trust created by a Grantor (and sometimes the Grantor's spouse as a Co-Grantor) to own life insurance on the life of the Grantor and/or the Grantor's spouse.  The advantage of using the Trust, rather than simply owning the life insurance outright, is that the life insurance proceeds received by the Trust at the death of the Grantor are not includable in the Grantor's estate.

To create a Life Insurance Trust, a trust document is prepared and signed.  The Trust then applies for a life insurance policy on the Grantor's life.  As an alternative, an existing policy can be transferred into the Trust. However, if that is done, the life insurance proceeds will still be included in the Grantor's estate, unless the Grantor dies more than 3 years after the date of the transfer of the existing policy into the Trust.  Annually, the Grantor makes contributions or gifts to the Trust so that the Trust has funds from which to pay the insurance premiums.  Upon the death of the Grantor, the life insurance proceeds are paid into the Trust and distributed in accordance with the Trust provisions.

  Providing Liquid Assets

Life Insurance Trusts are used most frequently as a means of providing liquid assets at the time of the death of the Grantor.  For example, the Grantor may own a profitable small business worth $2,000,000, but has few liquid assets such as cash, stocks, or other similar investments.  When the Grantor dies, there may be substantial federal estate taxes with little available cash to pay the taxes.  The life insurance proceeds can be loaned by the trust to the estate to pay the taxes.  Often this is acceptable because the beneficiaries of the Trust are the same as the beneficiaries under the Grantor's Will.  By using a Life Insurance Trust to own the life insurance, the estate avoids paying the additional estate taxes that would have otherwise been caused by having the Grantor directly own the life insurance and including the proceeds in the Grantor's estate.

  Specific Provisions

There are many specific provisions that must be included in the Life Insurance Trust to avoid problems with the Internal Revenue Service.  Further, the procedures followed by the  trustee in administering the Trust must be handled in a manner that avoids a successful challenge by the IRS that the Grantor is really the owner of the Life Insurance Trust.

If the IRS would succeed with that argument, the life insurance proceeds would be included in the Grantor's estate.  Therefore, it is recommended that you consult with an attorney, if you have further questions.

For more information, see:

 CHARITABLE TRUST

 WILLS AND ESTATE PLANNING

 ESTATE PLANNING WORKSHEET

 GENERATION SKIPPING TAX

 MARITAL DEDUCTION AND CREDIT TRUST

 MARITAL TRUST

 WILLS AND TRUSTS


 Charitable Trust

 A Charitable Trust is a special trust that includes one or more charitable organizations as beneficiaries.  A Charitable "lead" Trust pays the income of the Trust to the charity for a term of years, or perhaps until the death of the Grantor.  At the end of that time, the remaining assets are distributed in accordance with the Trust to other beneficiaries, perhaps the Grantor's children.

The more common Charitable "remainder" Trust is a trust that pays the income to the Grantor (and perhaps the Grantor's spouse) during the life of the Grantor (and/or the Grantor's spouse), and upon the death of the Grantor, the remaining Trust assets are distributed to one or more charitable organizations.

These trusts entitle the Grantor to a charitable income tax deduction at the time that the assets are initially transferred into the trust.  In addition, in the case of a charitable remainder trust, the assets of the trust are not included in the Grantor's estate.  This has the effect of reducing federal estate taxes that might otherwise have been payable.  To qualify for these tax benefits the provisions of the trust must meet very specific requirements of the federal tax code.

For more information, see:

 WILLS AND ESTATE PLANNING

 GENERATION SKIPPING TAX

 LIFE INSURANCE TRUST

 MARITAL DEDUCTION AND CREDIT TRUST

 MARITAL TRUST

 WILLS AND TRUSTS


 Executor/Personal Representative

 An "executor" or "personal representative" is the person or entity named in a Simple Will or Pour Over Will who has the responsibility of carrying out the terms of the Will.  Those responsibilities are to collect the Willmaker's assets, pay the debts and expenses of the estate, and distribute the remaining assets to the beneficiaries.  Some statutes use the term "personal representative", rather than the term "executor", and generally, either term is acceptable.  This program uses the more familiar "executor."

The executor's responsibilities are significant.  Therefore, the person or entity should be trustworthy and capable of handling financial matters.  A business background may be helpful, but certainly is not required.  If the executor will be working with a capable attorney, the executor's responsibilities will be much easier to handle.  Many banks have trust operations that provide executor services, but of course, the bank will charge for its services.  Executor fees can range from 1-2 percent in some states to as much as 4-5 percent in other locations.  Frequently, a spouse or adult child is named as an executor, and in such cases, the executor may "waive" or refuse to accept a fee for services.

For more information, see:

 WILLS AND ESTATE PLANNING

 POUR OVER WILL

 WILLS AND TRUSTS


 Probate

 Court procedures that determine whether a Will is valid or invalid, and monitor the subsequent process of paying the debts of the decedent and distributing the remaining assets to the beneficiaries.


 Trusts

 An intangible entity created during a person's life (living trust) or under a person's Will.  A trust provides for the management of all or a portion of the assets of the person (Trustor/Willmaker) in accordance with the terms specified in the Trust document or Will.

For more information, see:

 WILLS AND ESTATE PLANNING

 LIVING TRUST

 SIMPLE WILL

 TRUST FOR CHILDREN

 TRUSTEE

 WILLS AND TRUSTS


 Trustee

 The person or entity designated to manage trust assets and make distributions in accordance with the terms of the trust.


 Premarital Agreement

 A Premarital Agreement is an agreement between prospective spouses in contemplation of marriage.  The agreement becomes effective upon marriage.  The Premarital Agreement should be discussed by the parties well in advance of the marriage. Sufficient time should be permitted to allow both parties to consult their separate legal counsel or to sufficiently consider the agreement in order to avoid any later claims that the agreement is unenforceable because it was unfair.

  Consideration

The exchange of something for value, referred to as "consideration" is required for any contract to be enforceable.  Premarital Agreements require no additional consideration other than the marriage itself.  Therefore, the Agreement does not become effective until the marriage ceremony is solemnized.  Because the only consideration for a Premarital Agreement is the marriage ceremony, such an agreement cannot be entered into after the ceremony.

From a legal perspective, marriage can be viewed as a business arrangement.  Business transactions should not be entered without putting the terms in writing.  Marriage is really no different.  It is wise for the parties to sit down and work out the terms of the agreement, and anticipate how issues will be handled if the association must be dissolved.  Without an agreement the state will impose an agreement on the parties in the event of divorce or death.  By working through the provisions of this Agreement, a couple will develop a process of being able to communicate which will serve them well in the marriage relationship.

  Property Rights

A number of things may be clarified in a Premarital Agreement pertaining to property rights.  For example, the agreement may explain how property previously owned or acquired during the marriage will be distributed upon divorce, death, or the occurrence or non-occurrence of any other event. Other items which may be addressed include:

1.   Handling of debts;

2.   Making of a will or trust;

3.   Ownership rights in and disposition of a death benefit from a life insurance policy;

4.   Any other matter regarding personal rights and obligations as long as such matter does not violate public policy or criminal laws.

  Certain Aspects Not Honored

However, certain aspects that a couple may want to include in the Agreement may not be honored subsequently, such as provisions regarding child support or alimony.  Public policy considerations may prevent a court from enforcing such provisions.  Due to the difference in various states, the drafting of such provisions should be done in consultation with an attorney.

  Uniform Premarital Agreement

To further complicate matters, we live in a very mobile society.  Couples who enter an agreement in one state may very well relocate to another state.  To date, approximately twenty states have adopted the "Uniform Premarital Agreement Act."  (AZ, AK, CA, HI, IL, IA, KS, ME, MT, NV, NJ, NC, ND, OR, RI, SD, TX, VA).  This common act is a law that recognizes such agreements and clarifies what can be included in a Premarital Agreement.  However, there are variations among the various states' enactment of the uniform law.

For more information, see:

 ADDITIONAL INSTRUMENTS

 DISCLOSURE

 DISINHERITANCE OF SPOUSE

 DISSOLUTION OF MARRIAGE

 DIVORCE

 EARNINGS DURING MARRIAGE

 ESTATE ASSET DISTRIBUTION

 WILLS AND ESTATE PLANNING

 ESTATE PLANNING - PREMARITAL AGREEMENT

 EXECUTION OF PREMARITAL AGREEMENT

 JOINT OWNERSHIP OF PROPERTY

 LIVING EXPENSES/DEBTS

 MISCELLANEOUS PROVISIONS

 NAMES OF CHILDREN/SUPPORT OF CHILDREN

 PERSONAL EFFECTS

 RECITALS

 RESIDENCE

 REVOCATION OF PREMARITAL AGREEMENT

 SEPARATE PROPERTY

 SPOUSE'S DISABILITY

 SUPPORT OF SPOUSE

 TAXES

 VALUATION OF ESTATE ASSETS


 Recitals

 Many couples who marry today have previously been married or are dual career couples.  For these and other reasons, many couples contemplating marriage desire to address potential disagreements by making an agreement in advance of the marriage ceremony.  Recitals describe the background information and explain the reasons for making this agreement.  This explanatory information assists in the interpretation of the agreement.

For more information, see:

 PREMARITAL AGREEMENT

 SEPARATE PROPERTY


 Separate Property

 This provision states the couple's preference that any property owned prior to the marriage shall remain the separate property of the party who owned the property prior to the marriage.  Care should be taken not to commingle such separate property with other assets of the couple.  An option also permits the couple to state their intention that property acquired during the course of the marriage should also be treated as the separate property of the acquiring spouse.

If a couple resides in a community property state at any time after marriage, all real and personal property, wherever located, acquired after marriage, (except property acquired by gift, devise, bequest or inheritance) will be community property of the couple.  This community property scheme can be altered by a Premarital Agreement.

An additional provision anticipates the transfer of separate property without the necessity of obtaining the signature of the other spouse.  However, in some instances a third party may require the signature of the non-owning spouse to assure that the non-owning spouse will not assert any ownership rights in the transferred property.  The non-owning spouse agrees to sign such documents for the sole purpose of reflecting the relinquishment of any ownership interest for the convenience of the owner spouse.  Such signature will not be interpreted as any personal liability for the non-owning spouse who signs the document.

For more information, see:

 PREMARITAL AGREEMENT

 RECITALS

 RESIDENCE


 Residence

 This provision identifies who owns or leases the residence of the parties.  The parties may specify how the mortgage/lease payments and expenses associated with the maintenance of a residence will be shared.


 Earnings During Marriage

 Generally the law will consider any earnings of husband or wife to be property owned jointly by both parties.  This provision provides that each party desires to maintain his or her earnings as separate property.  Care should be taken not to commingle such separate property with other assets of the couple.

The couple may desire to use their earnings for the payment of joint and/or household expenses.  An optional provision provides that such usage should not be interpreted as implying joint ownership of the earnings.

For more information, see:

 LIVING EXPENSES/DEBTS

 PREMARITAL AGREEMENT

 SEPARATE PROPERTY

 SPOUSE'S DISABILITY


 Living Expenses/Debts

 Normally a husband and wife are responsible for the debts of the other if such debts are related to the necessities of life, such as food, shelter and medical care.  However, the parties may want to identify the separate treatment of certain expenses.  The program also permits the couple to allocate responsibility for debts incurred by credit cards.

A couple may want to specify how living expenses will be handled by them.  Sample provisions provide an outline for handling typical living expenses with contributions to a joint checking account.  Typical living expenses are listed and can be classified as joint or separate expenses. Additional space is also provided for the couple to compose their own arrangement.

The Debts provision states that debts incurred prior to the marriage shall remain the responsibility of the party incurring such debt.  Also, an optional provision allows the parties to maintain separate liability for debts incurred during the marriage.

Caution is advised relative to debts for the necessities of life.  Some jurisdictions will hold a spouse responsible for certain necessities such as medical expenses, food, clothing or shelter irrespective of a premarital agreement stating otherwise.

For more information, see:

 PREMARITAL AGREEMENT

 RECITALS

 RESIDENCE


Joint Ownership of Property

 This provision allows the couple to state in advance how property acquired after marriage will be owned, or to make that decision on a case-by-case basis.

JOINT TENANCY.  Property held by the husband and wife in joint tenancy with rights of survivorship will pass to the survivor on the death of the first spouse.  The property passes by virtue of joint tenancy irrespective of any provision to the contrary in a will.

TENANTS IN COMMON.  In contrast, each party can hold an undivided one-half interest in any property, and each one-half will pass to the respective spouse's heirs upon death.  If the spouse has a will, the one-half interest in the property will pass according to the terms of the spouse's will.  If the spouse dies intestate (without a will), heirship of property other than real estate will be determined by the laws of the state where the spouse died. If the property is real estate, heirship will be determined by the laws of the state in which the real estate is located.

For more information, see:

 DISCLOSURE

 DISSOLUTION OF MARRIAGE

 PREMARITAL AGREEMENT

 RESIDENCE

 SEPARATE PROPERTY

 SPOUSE'S DISABILITY


 Taxes

 This required provision allows the couple to take advantage of certain income, gift, estate tax provisions that benefit married couples.  These benefits might not otherwise be available, depending on the interpretation of the Premarital Agreement.  For example, the benefit that might be obtained by filing a joint federal or state income tax return can be preserved.

In addition, a married couple may make joint annual gifts (as of 1992 being $10,000 per donor to any other person (donee); or $20,000 per couple to any donee even though only one member of the couple actually makes the gift). Certain tax free transfers may be made between married couples.  Also there is an unlimited marital deduction under the federal estate tax law for the transfer of property to the surviving spouse on the death of the first spouse. (NOTE:  An explanation of the Marital Deduction and Credit Trust can be found in the  Wills and Trusts topic.)  For further information of tax considerations, consult your accountant or attorney.

For more information, see:

 JOINT OWNERSHIP OF PROPERTY

 LIVING EXPENSES/DEBTS

 PREMARITAL AGREEMENT


 Names of Children/Support of Children

 As further evidence of the reasons for entering this Agreement, which reasons support the enforcement of this Agreement, the parties should state the names of any children that are not children of the couple.  Deceased children's name are also included.

The support provision provides for the parties agreement that a step-parent may support step-children without establishing the legal responsibility to do so.  The Agreement does not contain a provision regarding the support of natural children of the couple in the event of divorce because such agreements are viewed as contrary to public policy.  The concern is that the couple might enter into an agreement that would not be fair to the children. The determination of child support is within the sole authority of the courts.

For more information, see:

 DISSOLUTION OF MARRIAGE

 PREMARITAL AGREEMENT

 SUPPORT OF SPOUSE


 Dissolution of Marriage

 This provision does not plan for separation or divorce. However, the parties may realize that such events are not uncommon.  The parties can express their intentions regarding how their property will be divided if they separate or upon dissolution of marriage (divorce).

Traditionally the law has opposed settlement agreements made at the time of marriage.  More and more courts and jurisdictions are looking to Premarital Agreements to govern property settlements.  Common settlement provisions are presented for inclusion in the Agreement.  The couple may also compose their own provisions.  Whether these provisions will ultimately be followed will depend upon the jurisdiction in which the parties reside at the time of separation or dissolution.  To ensure compliance with local law, an attorney should be consulted.  The provisions of the Premarital Agreement may also need to be reviewed if the couple changes their state of residence.

For more information, see:

 JOINT OWNERSHIP OF PROPERTY

 PREMARITAL AGREEMENT

 SUPPORT OF SPOUSE


 Support of Spouse

 Fewer and fewer courts are awarding alimony upon dissolution of a marriage.  If each spouse is self-supporting, each party may agree not to seek alimony in the event of separation or dissolution of marriage.  Merely reciting that the parties are self-supporting if they are not, will not be persuasive.  The court considering the support issue will make an independent determination of the need for alimony, if any.

For more information, see:

 EARNINGS DURING MARRIAGE

 NAMES OF CHILDREN/SUPPORT OF CHILDREN

 PREMARITAL AGREEMENT


 Spouse's Disability

 This provision allows each party to financially provide for the other in the event of disability.


 Death of a Spouse

 The Premarital Agreement can make provision as to the distribution of property upon death.  The couple may not want this Agreement to be interpreted as waiving the right to inherit from the other or to serve as executor of the other's estate.

  Distribution Other Than Spouse

Of course the parties may not want their estate to pass to the surviving spouse.  For example, each party may have sufficient assets to provide for his or her own support, or the parties may want to provide for their children or grandchildren.  In such situations a spouse may prefer to distribute his or her estate to someone other than the surviving spouse.

Even if the parties agree that their estates are to be distributed to someone other than their spouse, they may want certain  personal effects to pass to the surviving spouse.  For example, household items or the personal residence of the couple.

Another option is to allow the creation of a Will that can override the provisions of this Agreement should that be deemed appropriate in the future by the couple.

  Disinheritance of Spouse

Many states have enacted laws that prohibit the total  disinheritance of a spouse. For example, state laws provide for rights in a spouses property known as "dower" or "curtsey."  Also homestead provisions prevent the removal of a spouse from his/her home.  Such laws may allow a spouse to elect to take a share of the estate as specified by state law, commonly one-third or one-half of the estate.  Spouses may knowingly waive these marital rights in many jurisdictions.  The court having jurisdiction over the  distribution of the deceased spouse's estate will make the final decision.  To ensure compliance with local law, an attorney should be consulted.  The provisions of the Premarital Agreement may also need to be reviewed if the couple change their state of residence.

This program provides estate planning documents which may provide additional information useful in completing a premarital agreement and in preparing will or trust documents.  Additionally, explanation of terms and practices within an estate planning context is provided under the  Wills and Trusts section.

For more information, see:

 JOINT OWNERSHIP OF PROPERTY

 PERSONAL EFFECTS

 PREMARITAL AGREEMENT

 TAXES


 Disinheritance of Spouse

 Disinheriting means to deprive another person (an heir) of property that would have been distributed to that person under the laws of intestacy.  In some instances, an agreement between a willmaker and a spouse, signed prior to their marriage, may permit the spouse not to be included in the will.  However, many states "protect" spouses with laws that permit a spouse to receive a portion of the estate even though the deceased person's will does not provide for the spouse.  You may want to consult with an attorney regarding the legal rights of a willmaker's spouse to receive property from the estate, despite the provisions of a will or premarital agreement.

For more information, see:

 DEATH OF A SPOUSE

 ESTATE ASSET DISTRIBUTION

 JOINT OWNERSHIP OF PROPERTY


 Personal Effects

 Personal effects may be referred to as tangible personal property.  Jewelry, furniture, cars, and other items that have a physical essence are considered personal effects (or tangible personal property).  Personal effects do not include intangible personal property such as cash accounts, stocks, bonds, and other similar assets.  (For an additional explanation of tangible and intangible personal property, read the  Wills and Trusts topic).

For more information, see:

 ESTATE ASSET DISTRIBUTION

 JOINT OWNERSHIP OF PROPERTY

 SEPARATE PROPERTY


 Valuation of Estate Assets

 The value of an estate enables more accurate planning in preparing a will or other  estate planning document. The "net estate" should be determined in any planning activity.  The "net" value of an individual's assets is the total assets minus debts and liabilities.  A high value, more than $450,000, suggests that more complex estate planning techniques may be required to minimize the tax impact.  The Estate Planning Worksheet included in this program provides several alternatives in determining the net estate including a "summary listing" which provides summary information in general asset categories for situations where there are only one or two items in each asset category, and a "detailed" listing for listing of individual assets in each category.

Some general rules should be followed in providing values for assets.  Generally, the assets should be valued at their fair market value, i.e., the value paid by a willing buyer to a willing seller.  Often the fair market value of an asset will be more or less than its cost.  For example, the fair market value of a personal residence is often higher than its cost to the owner.

Items which should be valued include cash accounts, IRA accounts, and retirement plans, which should be listed at their values at the time of calculating the "net estate". Investment accounts, stocks, and bonds should be valued at their current market value, not their original cost.  Other items included in the valuation of an estate include real estate, life insurance policies, business interests, cars and other vehicles, household furnishings and personal belongings.

In addition, debts and liabilities must be considered. These should be listed at an amount equal to the current outstanding principal amount.  For example, the amount of a mortgage should be the current principal balance; credit cards should be listed at the current outstanding balance. It is not necessary to list current bills such as rent payments and outstanding utility bills.

For more information, see:

 ESTATE ASSET DISTRIBUTION

 JOINT OWNERSHIP OF PROPERTY

 SEPARATE PROPERTY


 Estate Asset Distribution

 The distribution of assets may be specified in documents other than a premarital agreement.  For example, a will may have been prepared prior to the premarital agreement which provides for specific distribution of property.  In preparing a premarital agreement, consideration should be given to documents which identify and distribute personal property and other assets, such as life insurance policies or employee benefit plans with beneficiary designations.

For more information, see:

 DEATH OF A SPOUSE

 JOINT OWNERSHIP OF PROPERTY

 SEPARATE PROPERTY

 ESTATE PLANNING - PREMARITAL AGREEMENT


 Estate Planning - Premarital Agreement

 In estate planning, consideration may need to be given to the provisions of a premarital agreement.  The Premarital Agreement may contain specific provisions regarding the ownership of assets prior to the marriage and guidance in the distribution of personal property and assets and should be consulted in estate planning activities.

For more information, see:

 DEATH OF A SPOUSE

 ESTATE ASSET DISTRIBUTION

 JOINT OWNERSHIP OF PROPERTY

 PREMARITAL AGREEMENT

 SEPARATE PROPERTY

 PERSONAL EFFECTS


 Revocation of Premarital Agreement

 This provision allows for the revocation of a Premarital Agreement by the signing of a written Revocation by both spouses.  To assure anyone dealing with the parties that the Agreement has not in fact been revoked, the provision requires that any revocation must be filed of public record with the appropriate office, such as a county recorder.

For more information, see:

 PREMARITAL AGREEMENT


 Additional Instruments

 To accomplish the intentions of this Agreement, it may be necessary for a spouse to sign an instrument relinquishing all of his/her rights in the property of the other spouse. In some instances a third party may require the signature of the non-owning spouse to assure that the non-owning spouse will not assert any ownership rights in the transferred property.  The non-owning spouse agrees to sign such documents for the sole purpose of reflecting the relinquishment of any ownership interest for the convenience of the owner spouse.

For more information, see:

 PREMARITAL AGREEMENT

 SEPARATE PROPERTY


 Disclosure

 The parties to a Premarital Agreement do not stand at arm's length to each other as in traditional contract bargaining. They are in a confidential relationship, and it is the duty of each to be frank and completely honest in disclosing all of the circumstances bearing on the agreement.  In other words, the parties enter this agreement with no intention of taking advantage of the other.

If one of the parties was not provided with a full disclosure of the property or financial obligations of the other spouse, the agreement may be revoked.  Grounds for revocation include proving that the agreement was involuntary, was unfair when signed, or that the party seeking revocation did not have, or could not have reasonably had an adequate knowledge of the property or financial obligations of the other spouse.  Therefore, full and fair consideration of the agreement itself should be made in advance of the marriage.  Also a complete disclosure of the financial affairs of each party must be made.

The program provides a format for completing a financial disclosure exhibit for both the prospective husband and prospective wife.  This program's "Exhibit" document can be used to prepare a financial disclosure exhibit.  Generally, every asset does not need to be listed.  The total value of each category of asset or liability is generally considered sufficient disclosure.  The party preparing the exhibit should sign it, and the spouse receiving the exhibit should initial it to indicate such receipt.

For more information, see:

 PREMARITAL AGREEMENT

 RECITALS


 Miscellaneous Provisions

 Despite the existence of premarital agreements, there remain substantial uncertainties as to the enforceability of all, or a portion, of the provisions which may be contained in such agreements.  Also, there is significant variation by state regarding the treatment of these agreements.

The Premarital Agreement includes provisions to assist in the enforceability of the Agreement: (i) the agreement shall be binding on those who seek to enforce the agreement as the representative of the parties, (ii) the agreement is the complete agreement of the parties, and (iii) any provisions which may be found to be unenforceable shall be limited or deleted, and the remainder of the agreement shall remain enforceable.

For more information, see:

 PREMARITAL AGREEMENT


 Execution of Premarital Agreement

 The Agreement must be signed PRIOR to the wedding ceremony, because the consideration (value) for entering the agreement is the act of marriage itself.

The signature block also provides for the document to be signed in the presence of a notary public to witness the agreement and permit the recording of the agreement in the public records.  The states of North Dakota, Ohio, and South Carolina require that the agreement be signed in the presence of witnesses.

For more information, see:

 PREMARITAL AGREEMENT

 ACKNOWLEDGEMENT


 Acknowledgement

 The "acknowledgement", sometimes referred to as the "notary block", is a required section of any document for which the signatures must be notarized.  This program provides the correct form for the state in which the document will be signed.  It is important that the document be notarized in the same state in which it is to be used.


 Financial Documents

 This program contains documents which might be used in a business transaction such as a Bill of Sale or a Promissory Note.  An agreement providing for the use or sale by one party of proprietary information, goods or services of another party is also included in this category.

For more information, see:

 BAD CHECK NOTICE

 BILL OF SALE

 BILL OF SALE - MOTOR VEHICLE

 GENERAL RECEIPT

 EQUIPMENT LEASE

 LICENSE AGREEMENT

 PROMISSORY NOTE

 DOCUMENT INFORMATION TOPIC LIST


Bill of Sale

 A Bill of Sale is a document under which a seller transfers personal property to a buyer.  This document CANNOT be used to transfer real estate.  If the property that will be transferred has been pledged as security for a loan, it may be necessary to obtain a release from the party to whom the loan is owed.  In such cases, it is advisable to consult with an attorney.

The Bill of Sale should be signed by both the Buyer and the Seller, and becomes effective as of the date provided in the text of the document.

For more information, see:

 FINANCIAL DOCUMENTS

 PROPERTY DESCRIPTION - BILL OF SALE

 WARRANTY - BILL OF SALE


Property Description Bill of Sale
Property Description - Bill of Sale

 The property listing can be detailed, or it may be described in one or more broad categories of property.  Obviously, a more detailed description makes it easier to identify the property that is being transferred.  This program offers two alternatives.  First, if a property description already exists, perhaps in the form of a description schedule, the listing can simply be attached as Exhibit A.  Second, This program allows for the property to be described in the body of the Bill of Sale, along with sales price information for each item of property.  If this option is used, a total of the items is conveniently provided.

For more information, see:

 BILL OF SALE

 WARRANTY - BILL OF SALE


Warranty Bill of Sale
Warranty - Bill of Sale

 Generally, the Seller provides a warranty that the property is being transferred free and clear of any liens or encumbrances, i.e., no other party has a valid claim to the property.  In addition, the Seller usually transfers the property "as is".  However, in some cases, the Seller may be willing to warrant that the property "is in good working condition".

For more information, see:

 BILL OF SALE

 PROPERTY DESCRIPTION - BILL OF SALE


Bill of Sale for Motor Vehicle

 The Bill of Sale - Motor Vehicle is a document under which one or more sellers transfer title rights in a motor vehicle to one or more buyers.  This document only represents the transfer of the RIGHT to ownership; the motor vehicle's certificate of title represents ACTUAL ownership.  Thus, this document and the certificate of title are needed to effectuate the transfer of the motor vehicle.

The Bill of Sale - Motor Vehicle should be signed by the seller(s), and becomes effective as of the date provided in the text of the document.  If the document includes the optional "odometer" section, the buyer(s) should sign immediately below the odometer statement.  The buyer(s) should make sure to obtain appropriate insurance coverage for the vehicle.

For more information, see:

 FINANCIAL DOCUMENTS

 MOTOR VEHICLE LIENS

 MOTOR VEHICLE WARRANTIES

 ODOMETER STATEMENT


Odometer Statement

 Federal law requires a statement by the seller as to the odometer mileage at the time of the transfer of ownership. In many states the odometer statement is included as part of the certificate of title.  This program includes an optional "Odometer Certification" section that provides the required information.  The buyer(s) are required to acknowledge the odometer statement by signing the Bill of Sale - Motor Vehicle immediately below the odometer statement.

For more information, see:

 BILL OF SALE FOR MOTOR VEHICLE

 MOTOR VEHICLE LIENS

 MOTOR VEHICLE WARRANTIES


Motor Vehicle Liens

 Generally, the seller provides a warranty that the vehicle is being transferred free and clear of any liens or encumbrances, i.e., no other party has a valid claim to the vehicle.  If the vehicle that will be transferred under this document has been pledged as security for a loan, it may be necessary to obtain a release from the party to whom the loan is owed.  Such a loan is a "lien" or "encumbrance" on the vehicle.

For more information, see:

 BILL OF SALE FOR MOTOR VEHICLE

 MOTOR VEHICLE WARRANTIES

 ODOMETER STATEMENT


Motor Vehicle Warranties

 Usually, the seller transfers the property "as is", but in some cases, the seller may be willing to warrant that the vehicle "is in good working condition", subject to a condition that the seller will only be liable for repair costs up to a specific amount if incurred during a specific time period after the date of the sale.

For more information, see:

 BILL OF SALE FOR MOTOR VEHICLE

 MOTOR VEHICLE LIENS

 ODOMETER STATEMENT


 Equipment Lease

 An equipment lease is an agreement that specifies the rights and obligations between a lessor (who owns equipment) and a lessee (who the lease gives certain rights to possess and use the equipment).  This program provides a simple lease for use in two situations:  First, where the equipment will be leased for a monthly rental and perhaps sold to the party who leases the equipment; and second, where the equipment will be leased (or "borrowed") for only a short period of time.

This program does not offer all variations that could be used in a lease, but it does offer the basic provisions, along with the most frequently used options.

Additional paragraphs can be added to cover unique situations.  An attorney should be consulted if you have any legal questions.  You should also consult with a tax professional regarding the possible tax consequences of your lease.

For more information, see:

 EQUIPMENT LEASE PAYMENTS

 EQUIPMENT SECURITY DEPOSIT

 FINANCIAL DOCUMENTS


 Equipment Lease Payments

 The obligation to make lease payments can be stated in either of two ways.  First, a rate can be based on the amount of usage; this option may work best if the total amount owed will be determined after the leased equipment is returned.  Second, if the total amount to be paid is known at the beginning of the lease and if the lease will be for a longer period of time, the lease payment can be stated as a "total amount owed", with a requirement to make periodic payments.

For more information, see:

 EQUIPMENT LEASE

 EQUIPMENT SECURITY DEPOSIT


 Equipment Security Deposit

 An equipment security deposit may be required (i) to provide for the possibility that the lessee will return damaged equipment, or (ii) as a means of collecting all or a significant portion of the lease payment, in cases where the total amount owed will not be determined until the equipment is returned.

For more information, see:

 EQUIPMENT LEASE

 EQUIPMENT LEASE PAYMENTS


 License Agreement

 A License Agreement is a document under which one party (the "Licensor") grants another party (the "Licensee") the right to use certain property.  For example, the right to "use" may be the right to "use" the Licensor's trademark on the Licensee's product, or it may be the right to "sell" or "distribute" the Licensor's software.

The License Agreement provided by this program is a simple but flexible document that provides a variety of optional paragraphs.  If your situation presents unusual circumstances, or if you have any legal questions, it is advisable to consult with an attorney.

For more information, see:

 ARBITRATION - LICENSE AGREEMENT

 DEFAULTS - LICENSE AGREEMENT

 FINANCIAL DOCUMENTS

 FREE-FORM PARAGRAPH

 GENERAL PROVISIONS - LICENSE AGREEMENT

 GRANT OF LICENSE

 MODIFICATIONS - LICENSE AGREEMENT

 PAYMENT OF ROYALTY

 RECORDS - LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT

 TRADEMARKS

 TRANSFER OF RIGHTS - LICENSE AGREEMENT

 WARRANTIES - LICENSE AGREEMENT


 Grant of License

 The Licensor either owns the licensed property outright or owns the right to license the property to others.  Under the  License Agreement, the Licensor then grants the Licensee either an "exclusive" or "non-exclusive" license to use the licensed property.  The grant is "exclusive" if only the Licensee (and not other third parties) will have the license.  The grant is "non-exclusive" if the Licensor also makes similar grants to other parties.  For example, a screen printer who owns the "exclusive" right to print the "University of Iowa" logo on T-shirts may grant "non-exclusive" licenses to several marketers or retailers to sell such T-shirts.

For more information, see:

 DEFAULTS - LICENSE AGREEMENT

 FREE-FORM PARAGRAPH

 PAYMENT OF ROYALTY

 RECORDS - LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT


 Payment of Royalty

 Usually the Licensor charges the Licensee a fee (royalty payment) in connection with the use of the licensed property.  For example, the fee may be a "one-time" payment that is paid at the time of the signing of the agreement, or it may be payable in installments.  As an alternative, the fee may be based on the number of times that the Licensee uses or sells copies of the licensed property.

For more information, see:

 DEFAULTS - LICENSE AGREEMENT

 FREE-FORM PARAGRAPH

 GRANT OF LICENSE

 LICENSE AGREEMENT

 RECORDS - LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT


 Records - License Agreement

 A Records paragraph requires the Licensee to maintain records and allows the Licensor to inspect the records by giving notice to the Licensee.  This paragraph is important to the Licensor if a  royalty will be charged and if the royalty is based on the number of copies of the licensed property that are sold.  The right to inspect allows the Licensor to check on whether the royalty is being calculated properly.

For more information, see:

 DEFAULTS - LICENSE AGREEMENT

 FREE-FORM PARAGRAPH

 GRANT OF LICENSE

 LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT


 Modifications - License Agreement

 The Licensor may not want the licensed property to be modified in any manner, for example, with the use of a logo.  In many cases, the Licensor may be willing to include a phrase that allows modifications if the Licensor's consent has been obtained.

For more information, see:

 LICENSE AGREEMENT


 Defaults - License Agreement

 The Licensor will want to make sure that this provision is included.  If the agreement requires a  royalty payment, it is recommended that the optional phrase "including the obligation to make a royalty payment" be included.  The Licensee will want to include the optional provision that allows the Licensee to "cure" the default by taking corrective action prior to the end of the specified notice period.

For more information, see:

 FREE-FORM PARAGRAPH

 GRANT OF LICENSE

 LICENSE AGREEMENT

 RECORDS - LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT


 Arbitration - License Agreement

 If the parties cannot resolve differences between them on a mutually acceptable basis, the parties may be forced to resort to a lawsuit to settle such issues.  Arbitration may be a less expensive process that avoids the court system.  It is a process under which the parties submit their dispute to a neutral party (arbitrator) who gathers information, listens to the arguments, and makes a decision.

For more information, see:

 GENERAL PROVISIONS - LICENSE AGREEMENT

 LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT


 Warranties - License Agreement

 Generally, the Licensor makes no warranties regarding the licensed product, although in some cases the Licensor may be willing to provide at least some type of "money-back" guaranty for a thirty day period.  This type of guaranty could be added as a part of the  "free-form" license agreement paragraph, but should be done only after consulting with an attorney.

For more information, see:

 LICENSE AGREEMENT


 Transfer of Rights - License Agreement

 This paragraph explains the effect of the  License Agreement on parties who become "successors" to the parties.  For example, if the Licensee "sells" or "transfers" its rights under the agreement to a third party, that third party becomes bound under the agreement. The second part of this provision allows the user to include a sentence that prohibits such transfers, unless the other party consents.  In the above example, the Licensee would not be able to "sell" or "transfer" its rights to a third party, unless the Licensor's consent was obtained.

For more information, see:

 GENERAL PROVISIONS - LICENSE AGREEMENT


 Termination - License Agreement

 A termination paragraph is an important provision.  If disputes arise and it seems too costly to resolve the issues through  arbitration or the court system, being able to terminate the agreement upon 30 days notice may be a way to resolve the situation.  Please note that both options can be used.  For example, a "one-year" agreement can be made by marking the second option and picking a date for automatic termination that is one year after the date that the agreement is made.  In addition, the parties can provide for earlier termination by also choosing the first option, and allowing the parties to terminate by giving a specified amount of notice, perhaps 60 or 90 days.

For more information, see:

 ARBITRATION - LICENSE AGREEMENT

 DEFAULTS - LICENSE AGREEMENT

 FREE-FORM PARAGRAPH

 LICENSE AGREEMENT


 General Provisions - License Agreement

 A  License Agreement should include provisions that (i) make it clear that the agreement contains the entire agreement of the parties, (ii) require changes to the agreement to be in writing, signed by both parties, (iii) protect the agreement if one of its provisions is unenforceable, (iv) specify the effect of a party's failure to always strictly enforce the terms of the agreement, and (v) specify which state's laws will govern disputes between the parties.

For more information, see:

 ARBITRATION - LICENSE AGREEMENT

 DEFAULTS - LICENSE AGREEMENT

 TERMINATION - LICENSE AGREEMENT

 TRANSFER OF RIGHTS - LICENSE AGREEMENT


 Promissory Note

 A Promissory Note is a written document that specifies the terms, rights, and obligations that apply to a loan.  The party making the loan is the "payee" and the party borrowing the loan funds is the "promisor".  The note includes provisions regarding the amount of the loan, the interest rate, the date by which the loan must be repaid, and the amount of the payments.  It may also include other provisions that are important in enforcing the payment of the note.

  Payback Options

This program permits a wide variety of payback options, including the use of a balloon payment.  In addition, the program provides an amortization table based on your selection of monthly, quarterly, semi-annual, or annual payments.  You may also select a variety of optional paragraphs.

The first section of the Promissory Note document is a "financial worksheet".  This worksheet can be used to enter the basic financial information and to choose whether the note will be paid:

- "on demand" (i.e., payable immediately at the request of the payee),

- "in full on a specific date" (i.e., no monthly payments; rather, all of the principal and interest will be due on a future date that is specified in the note),

- "in installments of interest only" (e.g., interest will be due on a quarterly or monthly basis, but the principal will not be due until a future date that is specified in the note"),

- "in installments of principal only"

- "in installments of interest and principal" (e.g., interest and principal will be due in regular payments similar to monthly mortgage payments).

This basic information is then transferred into the text of the note.  This transferred information can be seen at sections 2 (Promisor Information) and 4 (Payment Terms) of this program.

For more information, see:

 ACCELERATION

 AMORTIZATION

 ASSIGNMENT

 COSTS

 DEFAULT RATE

 DISCOUNT

 EVENTS OF DEFAULT

 FINANCIAL CALCULATOR & BALLOON PAYMENT

 FINANCIAL DOCUMENTS

 GENERAL PROVISIONS - NOTE

 GUARANTY

 INTEREST

 LATE CHARGE

 LIFE INSURANCE

 PREPAYMENT

 SECURITY AGREEMENTS


 Financial Calculator and Balloon Payment

 If the promissory note will be repaid in "installments of interest and principal", a financial calculator is available as part of the first section to assist with the calculation of the payment amount.  Further, the user can play "what if" by changing other variables (i.e., interest rate, principal amount, and payment frequency) to determine how such changes would affect the amount of the payment.  For example, the monthly payment will automatically increase if the interest rate is increased.  The information from the calculator is automatically transferred to the appropriate section of the note.

The calculator also allows for the possibility of a "balloon payment".  For example, the promisor wants to borrow $10,000 at 8% for 5 years, but the monthly payments of $202.76 are too high.  As an alternative, the monthly payment can be changed arbitrarily to $175.00.  The calculator then computes a "balloon" payment of $2,040.01 which is due at the end of the 5 years and "makes up" for the decreased monthly payments.  In this illustration, 60 monthly payments of $202.76 equal total interest and principal paid of $12,165.60, while 59 payments of $175.00, plus 1 "balloon payment" of $2,040.01 equal total interest and principal paid of $12,365.01.  The reason for the difference is that the lower monthly payments of $175.00 do not reduce the principal balance very quickly, and therefore, more interest is paid over the life of the five year loan.

For more information, see:

 AMORTIZATION

 INTEREST

 PROMISSORY NOTE


 Amortization

 An amortization schedule is a schedule of principal and interest payments for a promissory note, mortgage, or other type of debt.  The term "amortization" means to repay a loan in equal installments over a period of time.  Each periodic payment (usually a monthly payment) includes principal and interest -- the initial payments include higher amounts of interest and as the principal amount is gradually reduced, the monthly payments include more principal and less interest.

For more information, see:

 FINANCIAL CALCULATOR & BALLOON PAYMENT

 PROMISSORY NOTE


 Default Rate

 If the promisor fails to pay off the note on or before the due date, it is common to assess a higher rate of interest that becomes effective as of the due date.  This higher "default rate" provides an incentive for the promisor to pay the note when due, and if the promisor fails to do so, provides some additional compensation to the payee.  The following example provides an illustration.

Rose (as the promisor) signs a promissory note with Ed which includes the following terms: principal amount -- $5,000; interest rate -- 7%; and due date -- February 23, 1997.  The note also includes a stated default rate of 10%.  This higher rate provides an incentive for Rose to pay off the note by the due date.  If she does not, Ed is entitled to interest at 10% on the unpaid balance, with the higher rate going into effect on February 23, 1997.

For more information, see:

 ACCELERATION

 DISCOUNT

 LATE CHARGE

 PREPAYMENT

 PROMISSORY NOTE


 Late Charge

 As a negative incentive to encourage the promisor to make required payments when due, the "late charge" provision can be included.  This provision requires the promisor to pay a fixed dollar amount if an installment is not paid by its due date.  This option is designed to be used if the note will require installment payments of principal and interest or installment payments of interest only.  It is not intended to be used in notes that are "due on demand" or "in full on a specific date".

This option can be used in conjunction with both the "late charge" and "discount" options.

For more information, see:

 ACCELERATION

 DEFAULT RATE

 DISCOUNT

 PREPAYMENT

 PROMISSORY NOTE


 Discount

 A "discount" provision can be used as a "positive" incentive to encourage the promisor to pay off the note early.  This option is not a commonly used provision, probably because the discount has the effect of reducing the amount of interest earned.

For more information, see:

 ACCELERATION

 DEFAULT RATE

 LATE CHARGE

 PREPAYMENT

 PROMISSORY NOTE


 Acceleration

 An "acceleration" provision allows the payee to demand immediate payment of an entire loan balance, including payments otherwise due at a future time, if a promisor defaults under a promissory note.  For example, if Scott (the promisor) has paid two required monthly payments under a note that will run for 5 years, and if he then stops making payments when due, Mary (the payee) can then "accelerate" payment of the note by demanding payment of the remaining principal balance plus accrued interest. ("Accrued interest" is interest that has accumulated, but has not been paid.)

For more information, see:

 DEFAULT RATE

 DISCOUNT

 LATE CHARGE

 PREPAYMENT

 PROMISSORY NOTE


 Costs

 Promissory notes usually include a "costs" provision which obligates the promisor to pay the payee's collection costs, if the promisor defaults in paying the note.  For example, if Gary (the promisor) fails to pay a $10,000 note to Carroll (the payee) on the due date, and if Carroll has to hire a lawyer to start a lawsuit to collect the note, Gary can be required to pay the cost of the lawsuit including Carroll's attorney fees.

For more information, see:

 EVENTS OF DEFAULT

 GENERAL PROVISIONS - NOTE

 LIFE INSURANCE

 PROMISSORY NOTE

 SECURITY AGREEMENTS


 Prepayment

 A "prepayment" provision allows the promisor to prepay the note without penalty.  This provision is beneficial to the promisor who may wish to reduce interest charges by paying off the note early.  Compare this provision with the "discount" provision.

For more information, see:

 ACCELERATION

 DEFAULT RATE

 DISCOUNT

 LATE CHARGE

 PROMISSORY NOTE


 Events of Default

 A "default" is the failure to do something required by a contract, note, lease, or other legal agreement.  Often a promissory note lists "events of default"; usually these "events" are events that may impair the promisor's ability to repay the note.  Because these events threaten the promisor's repayment ability, the payee is allowed to demand immediate payment of the entire note if an "event of default" occurs.

For more information, see:

 GENERAL PROVISIONS - NOTE

 LIFE INSURANCE

 PROMISSORY NOTE

 SECURITY AGREEMENTS


 Security Agreements

 A security agreement is a document that is often used in a business setting under which the promisor pledges property to assure payment of the promissory note.  If the promisor fails to make payments on the note, the security agreement usually gives the payee the right to have the pledged property sold to pay off the note.  It is very important to note that the payee may be required to take additional steps under local law to make sure that the payee's claim against the pledged property has priority in the case of default. These additional steps may be complicated and it is advisable to consult an attorney if a security agreement will be used.

For more information, see:

 EVENTS OF DEFAULT

 GENERAL PROVISIONS - NOTE

 LIFE INSURANCE

 PROMISSORY NOTE


 Life Insurance

 A "life insurance" provision is sometimes required by commercial lenders in connection with home loans and auto loans.  It can be included so that funds (the life insurance death proceeds) will be available to pay off the note, if the promisor dies before the note is fully repaid.  If this provision is included, the payee may wish to make sure that the life insurance proceeds will be payable directly to the payee.

For more information, see:

 EVENTS OF DEFAULT

 GENERAL PROVISIONS - NOTE

 PROMISSORY NOTE

 SECURITY AGREEMENTS


 Interest

 Most states have usury laws that limit the amount of interest that can be charged.  Therefore, if an interest rate will be charged that is unusually high, it is advisable to check with an attorney or local bank to make sure that state usury laws will not be violated.

The Internal Revenue Service has special "imputed interest" rules that apply if no interest is charged or if the interest rate charged is lower than the statutory federal rate of interest.  The IRS treats such loans as having a higher interest rate than the rate stated in the promissory note. Exceptions apply to some loans of $10,000 or less.  Consult a tax advisor or attorney if no interest or low interest will be charged.   The statutory federal rate of interest changes each month, and this information may be obtained from a local bank.

For more information, see:

 PROMISSORY NOTE


 General Provisions - Note

 The "general provisions" for the promissory note include standard provisions that assist the payee in enforcing payment of the note by the promisor.


 Assignment

 The "assignment" option can be included to allow the payee to transfer (sell) his or her right to receive the loan payments from the promisor.  For example, the payee may assign his or her rights to collect the note payments to a bank.  The bank probably would not pay full value to the payee because of the usual risk that the promisor may not make all of the note payments.

For more information, see:

 GUARANTY

 PROMISSORY NOTE


 Guaranty

 A "guaranty" provision can be included so that a "guarantor" becomes obligated to repay the promissory note for the promisor, if the promisor defaults by not making payment of the note.  Obviously, the guarantor, perhaps a third party friend or relative of the promisor, does not become liable unless the guarantor signs the "guaranty" section of the note.

For more information, see:

 ASSIGNMENT

 PROMISSORY NOTE


 General Receipt

 A receipt is an acknowledgement in writing that something of value (money or property) has been placed into the possession of another individual.  The General Receipt does not serve to transfer legal ownership of the property.  It merely provides evidence that the recipient has obtained possession of the property.  You may wish to use This program's "Bill of Sale" in order to transfer legal ownership.  This document provides various receipt forms. See Receipt Options.

 Signing the General Receipt

The receipt should be signed and dated by the recipient of the money or property.  The original receipt should go to the person making the payment, or delivering an item.  A copy of the receipt should be retained by the recipient.

For more information, see:

 RECEIPT OPTIONS


 Receipt Options

 The program offers several options to customize the receipt for the type of item being delivered.  Unique provisions appropriate to the payment of money, receipt of property, and the receipt of documents are presented.

 Cash Receipt

A cash receipt is an acknowledgement in writing that cash (or a cash equivalent) has been paid without reciting either party's obligations to the other.  To increase the usefulness of this general receipt form, options are presented to include the discharge of an obligation by the paying party.  Thus the obligation is "satisfied" by the receipt of the appropriate payment.  Another option is presented for the acceptance of less than full payment as complete satisfaction of the obligation.  This is called an "accord and satisfaction."

 Property Receipt

The property receipt provides documentation that certain items were delivered, and includes options for delivery of goods pursuant to a purchase order, including the condition and acceptance of such goods.  Other options include the value of the property delivered, the condition of the property, and a disclaimer of responsibility for any damage to the property.

 Documents Receipt

Receipts are also used to acknowledge the delivery of documents or other written or printed materials, especially those of a type which are difficult or expensive to replace. Thus the person delivering a document to another business or individual has a record that the documents were in fact delivered, and the date of such delivery.

For more information, see:

 GENERAL RECEIPT


 Health Care Documents

 An "advance directive" is a document signed by a competent adult (a "Declarant") in advance of a serious illness or accident, in which the Declarant provides directions regarding health care that should (or should not) be provided to the Declarant if the Declarant is unable to communicate his or her wishes.  This program provides the following advance directive documents for use in making health care decisions.

  Living Will

*  Living Will - a document under which a Declarant states his or her wishes regarding medical care that should be withheld or withdrawn if the Declarant's death is expected to occur soon, or perhaps if the Declarant is in a permanent coma.

  Health Care Power of Attorney

*  Health Care Power of Attorney - a much broader document than a Living Will, because (i) it covers any health care decision, and (ii) the Declarant (or Principal) is permitted to designate a person who the Declarant trusts (an  "Agent" ) who will have authority to make any health care decisions on behalf of the Declarant, if the Declarant is unable to make and communicate such decisions.

  Advance Health Care Directive

*  Advance Health Care Directive - a document that combines the best features of the Living Will and Health Care Power of Attorney, and provides additional options.

*  Revocations for these documents are also provided.

If a state statute provides a "sample" Living Will and/or Health Care Power of Attorney form, this program offers that state's particular form(s), along with additional optional provisions that the user may wish to include.

This program offers the Advance Health Care Directive document that combines the best features of the Living Will and Health Care Power of Attorney documents of the various states.  This program also offers the state specific Advance Directive form for the states of Kentucky, Oklahoma, Oregon and Virginia.  The remaining states do not offer a specific form. The generic form of this document is offered as a unique document that complies with the encouragement of the U.S. Supreme Court for individuals to state their preferences for health care in accordance with their own specific wishes.  If you have specific legal questions, it is recommended that you contact an attorney who is familiar with your state's statutes regarding advance directives.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 REVOCATION OF ADVANCE DIRECTIVE

 REFUSAL TO DONATE

 ORGAN DONATION

 DOCUMENT INFORMATION TOPIC LIST


 Living Will

 A Living Will is a document under which a competent adult (a "Declarant"), prior to becoming unconscious or incompetent, declares his or her intention that certain procedures (sometimes referred to as  "life-sustaining procedures" ) should be withheld or withdrawn under specified circumstances.  The program allows you (the Declarant) to state:

*  whether life-sustaining procedures should be withdrawn or withheld so that you can die naturally if you have a  "terminal condition", or are in a  "permanent coma";

*  whether  "artificial nutrition/hydration" should be provided to you if you have a "terminal condition" or are in a "permanent coma";

*  what effect shall be given to the Living Will if you are  pregnant; and

  Other Provisions That Limit or Expand Document

*  other provisions that limit or expand the document provisions offered by this program (for example, provisions regarding access to medical records, authority to perform an  autopsy,  anatomical gifts, or even the location of your health care, such as residency in a nursing home).

  Agent

As the Declarant you are also permitted to designate a specific person (an  "Agent" ) to make health care decisions on your behalf when you are unable to do so (if your state's laws permit such a designation).

NOTE:  Many states provide sample Living Will forms as part of their statutes that authorize Living Wills.  This program provides the appropriate sample form for each state, if one has been specified.  In addition, the user is allowed to customize the form by adding optional provisions.

  Giving Medical Directions To Health Care Providers

Although a Living Will document has been executed, you (as the Declarant) retain the right to give current medical directions to physicians and other providers of health care services as long as you are able to do so.  This document only becomes effective when you do not have the capacity to give, withdraw or withhold informed consent regarding your health care.  The documentation of your wishes and desires in an advance directive is encouraged because it provides guidance to your health care providers regarding your wishes.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 HEALTH CARE DOCUMENTS

 SEVERABILITY


 Health Care Power of Attorney

A Health Care Power of Attorney is a document under which a competent adult (a "Principal"), prior to becoming unconscious or incompetent:

*  declares his or her intention that certain procedures (sometimes referred to as "life-sustaining procedures") should be withheld or withdrawn under specified circumstances (in a manner similar to a Living Will); and

*  designates a person (an "Agent") who will have authority to make health care decisions on behalf of the Declarant, if the Declarant is unconscious, incompetent or otherwise unable to make such decisions.

  Granting Authority to Agent

You (as the Principal) can grant extensive authority to your Agent to act on your behalf.  This authority may include the authority to make any type of health care decision.  In contrast, a Living Will only address life-sustaining procedures.  The following examples illustrate the broad powers that you can include in a Health Care Power of Attorney.  The program allows you to state:

*  whether life-sustaining procedures should be withdrawn or withheld so that you can die naturally if you have a "terminal condition", or are in a "permanent coma";

*  whether "artificial nutrition/hydration" should be provided to you if you have a "terminal condition", or are in a "permanent coma"; and

*  other provisions that limit or expand the provisions offered by this program (for example, provisions regarding access to medical records, authority to perform an autopsy, anatomical gifts, or even the location of your health care, such as residency in a nursing home).

NOTE:  Many states provide sample Health Care Power of Attorney forms as part of their statutes that authorize such documents. This program provides the appropriate sample form for each state, if one has been specified.   In addition, the user is allowed to customize the form by adding optional provisions.

Although a Health Care Power of Attorney document has been executed, you (as the Principal) retain the right to give current medical directions to physicians and other providers of health care services as long as you are able to do so. This document only becomes effective when you do not have the capacity to give, withdraw or withhold informed consent regarding your health care. The documentation of your wishes and desires in this type of document in encouraged because it provides guidance to your health care providers and your Agent regarding your wishes.

Durable Power of Attorney.  The Health Care Power of Attorney is a "durable" power of attorney because the document is effective during any period of time that the Declarant is not competent.

For more information, see:

 AGENT

 DURABLE POWER OF ATTORNEY

 HEALTH CARE DOCUMENTS

 LIFE SUSTAINING PROCEDURES


 Advance Health Care Directive

 Most states have statutes that authorize advance directives, in the form of Living Will and/or Health Care Power of Attorney documents. Typically, the statutes provide sample forms.  This program offers the Advance Health Care Directive as a "generic" form and as state specific forms, which combine the best features of the Living Will and Health Care Power of Attorney documents.  Under the Advance Health Care Directive, a competent adult (a "Declarant"), prior to becoming unconscious or incompetent:

*  declares his or her intention that certain procedures (sometimes referred to as "life-sustaining procedures") should be withheld or withdrawn under specified circumstances (in a manner similar to a Living Will or a Health Care Power of Attorney); and

*  designates a person (an "Agent") who will have authority to make health care decisions on behalf of the Declarant, if the Declarant is unconscious, incompetent or otherwise unable to make such decisions (in a manner similar to a Health Care Power of Attorney).

  Guidelines For Agent

The program allows you (as the Declarant) to provide guidelines for your Agent in making health care decisions for you.  For example, the program allows you to state:

*  whether life-sustaining procedures should be withdrawn or withheld so that you can die naturally if you have a "terminal condition", or are in a "permanent coma";

*  whether "artificial nutrition/hydration" should be provided to you if you have a "terminal condition", or are in a "permanent coma";

*  what procedures (e.g., chemotherapy, kidney dialysis, cardiopulmonary resuscitation, use of a respirator) you do or do not wish to receive;

*  whether you have made arrangements to make "anatomical gifts");

*  what effect shall be given to your Advance Health Care Directive if you are pregnant ("pregnancy"); and

*  other provisions that limit or expand the document provisions offered by this program (for example, provisions regarding access to medical records, authority to perform an autopsy, or even the location of your health care, such as residency in a nursing home).

  Giving Directions to Health Care Providers

Although an Advance Health Care Directive has been executed, you (as the Declarant) retain the right to give current medical directions to physicians and other providers of medical services as long as you are able to do so.  This document only becomes effective when you do not have the capacity to give, withdraw or withhold informed consent regarding your health care.  The documentation of your wishes and desires in this type of document in encouraged because it provides guidance to your health care providers and your Agent regarding your wishes.

  Durable Power of Attorney

Durable Power of Attorney.  The Advance Health Care Directive is "durable" because the document is effective during any period of time that the Declarant is not competent.

Warning.  Although the Advance Health Care Directive document does not follow the "word-for-word" terminology of any particular state's form(s), this document is offered as a unique document that complies with the encouragement of the U.S. Supreme Court for individuals to state their preferences for health care in accordance with their own specific wishes.  The states of CALIFORNIA, RHODE ISLAND and WISCONSIN require the use of their respective state specific forms; these forms are offered as part of this program's "Living Will" and "Health Care Power of Attorney" documents. In addition, the states of NEVADA, NEW HAMPSHIRE, OHIO, SOUTH CAROLINA, TENNESSEE, TEXAS, AND VERMONT have unique statutory requirements regarding the form of advance directives.  The NORTH DAKOTA statute provides that the form provided in its statute is the "preferred form".  KENTUCKY, OREGON, VIRGINIA, AND OKLAHOMA have adopted specific advance directive forms which are available in this program. The conservative approach is to use the respective state specific forms for those states, although it is expected that the United State Supreme Court would require these states to honor the wishes of an individual as reflected in this program's Advance Health Care Directive.

If you have specific legal questions, it is recommended that you contact an attorney who is familiar with your state's statutes regarding advance directives.  You are encouraged to review the  "Health Care Documents" topic.  Further, the  "Severability" section of the Advance Health Care Directive document provides important protection to the user of this document.

For more information, see:

 AGENT

 ANATOMICAL GIFTS

 ARTIFICIAL NUTRITION/HYDRATION

 AUTOPSY

 DURABLE POWER OF ATTORNEY

 GUARDIAN OR CONSERVATOR

 HEALTH CARE POWER OF ATTORNEY

 HOLD HARMLESS

 LIFE SUSTAINING PROCEDURES

 LIVING WILL

 MICHIGAN - PATIENT ADVOCATE ACCEPTANCE

 MISSISSIPPI - DISCLOSURE STATEMENT

 OKLAHOMA - ATTORNEY GENERAL OPINION

 OTHER REQUESTS

 PERMANENT COMA

 PREGNANCY

 REVOCATION OF ADVANCE DIRECTIVE

 SAMPLE PROVISIONS

 SIGNATURES - ADVANCE DIRECTIVE

 SPECIFIC MEDICAL PROCEDURES

 TERMINAL CONDITION

 VIRGINIA-HEALTH CARE DECISIONS ACT

 WITNESSES

 NOTARY


 Agent

 An "Agent" is a person who is authorized legally to act on behalf of another person or entity.  In the context of an advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive), an Agent is a person who is authorized by the Declarant or Principal (the person who will sign the advance directive) to make health care decisions on behalf of the Declarant, if the Declarant is unable to do so.  Some statutes refer to the Agent as an "Attorney-in-Fact", "Health Care Agent", "Health Care Proxy", "Health Care Representative", "Patient Advocate", "Proxy" or "Surrogate".

  Choosing an Agent

The person that you (as the Declarant) designate as the Agent should be someone you know and trust.  The statutes of most states require that the Agent be an adult.  In addition, under most circumstances, your Agent cannot be your health care provider (e.g. a physician, a nurse, an employee, officer, director, or operator of a home health agency, hospital, nursing home or residential care facility), unless that person is related to you.  Thus, in selecting an Agent, you should not designate a person who is (or may become) directly involved in providing health care to you, unless that person is your spouse or a family member.

  Agent's Authority

Generally, an Agent has broad authority to make almost any decision regarding the Declarant's health care, if the Declarant is unconscious or otherwise unable to communicate his or her wishes.  However, as the Declarant, you may limit your Agent's authority by including guidelines in the advance directive that specify your wishes.  For example, your Agent would not have the authority to override a stated desire in your Advance Health Care Directive not to receive kidney dialysis.

It is not possible to anticipate all of the health care decisions that may be required.  If the advance directive does not provide specific direction regarding a particular health care decision that must be made, your Agent must act in your best interests.  Unless you state otherwise, your Agent has the same authority to make decisions about your health care as you would have.  Your Agent is not liable for health care decisions made in good faith.  You should discuss your wishes, values, and preferences regarding your health care with your Agent so that your Agent is best able to make decisions in accordance with your wishes.

  Alternate Agent

It is advisable to designate an alternate Agent to provide for the possibility that your Agent will be unwilling, unable, or ineligible to act as your Agent.  For example, many states automatically revoke a spouse's authority to act as Agent if the couple is separated or divorced.  Any alternate Agent has the same authority to make health care decisions as the original Agent.

  State Statutes Regarding Agents

Living Will Warning.  Not all states have statutes that specifically state whether an Agent may be designated in a Living Will.  Although it is reasonable to believe that this "silence" does not prohibit the designation of an Agent, this program offers the option of choosing an Agent only for the following states which specifically authorize the designation of an Agent in their Living Will statutes: Arkansas, Delaware, Florida, Hawaii, Idaho, Indiana, Louisiana, Maine, Minnesota, Montana, Nevada, Pennsylvania, South Carolina, Texas, and Wyoming.  For all other states it is recommended that the user use the Advance Health Care Directive or Health Care Power of Attorney documents offered by this program.

  Minnesota Living Wills

Minnesota Living Wills.  For Minnesota users, if the Proxy provisions in the Living Will are not selected by the user, the Proxy provisions are still printed "in blank" in the document to show that the Proxy option was presented, but not selected.

For more information, see:

 COPIES

 HEALTH CARE POWER OF ATTORNEY

 REVOCATION OF ADVANCE DIRECTIVE


 Durable Power of Attorney

 Under a "durable" power of attorney document, an Agent's authority to act on behalf of the Declarant (or Principal) generally becomes effective upon the Declarant's disability or mental incompetence, and continues during such period of disability or mental incompetence.  If the Agent's authority continues to be effective despite the Declarant's disability or mental incompetence, the power of attorney document is said to be "durable".  The Health Care Power of Attorney and Advance Health Care Directive documents included in this program are special forms of power of attorney documents, and both are "durable".  They are durable because the Agent has authority to make health care decisions for the Declarant during any period of time that the Declarant is not competent.  Read the  "Signatures - Advance Directive" topic for more information regarding "competency".

The Advance Health Care Directive allows you (as the Declarant) to state when the Agent's authority will become effective.  In addition, this program offers significant flexibility for you to state how the determination of incompetency will be made.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 WILLS AND TRUSTS


 Terminal Condition

 A "terminal condition" is a progressive, incurable, or irreversible condition that is expected to cause death within a relatively short period of time, unless life-sustaining procedures are used.  The adjectives "incurable" and "irreversible" are used to indicate that there will be no "recovery" from the condition by means of a cure, treatment of symptoms, or otherwise significantly retarding the deteriorating health condition.  The term "relatively short period of time" provides flexibility to the health care providers who, at best, can only provide an estimate of when death will occur as a result of the condition and other health factors.

It may be helpful to compare the information in this "Terminal Condition" section with the information in the  "Permanent Coma" section.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE

 ARTIFICIAL NUTRITION/HYDRATION

 DURABLE POWER OF ATTORNEY

 HEALTH CARE DOCUMENTS

 HEALTH CARE POWER OF ATTORNEY

 HOLD HARMLESS

 LIFE SUSTAINING PROCEDURES

 LIVING WILL

 OKLAHOMA - ATTORNEY GENERAL OPINION

 PREGNANCY

 SPECIFIC MEDICAL PROCEDURES


 Permanent Coma

 The term "permanent coma" generally means a lasting condition, indefinite and without change, in which thought, awareness of self and environment, and all other indications of consciousness are absent. Sometimes this condition is described as a "coma", an "irreversible coma", being "persistently unconscious", being "permanently unconscious", or a "persistent vegetative state" from which there is no known hope of recovery.

Prior to 1989, most state statutes clearly provided that an advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive) was appropriate if the Declarant was terminally ill.  However, most of these statutes were silent on the question of whether an advance directive could also apply if the Declarant was in a permanent coma.  In a U.S. Supreme Court case decided in 1989, a clear indication was given that a Declarant should be free to state that his or her advance directive should also apply if the Declarant is in a permanent coma, if that is the Declarant's desire.  In response, many states amended their statutes to provide guidance to persons who wanted to clearly specify that their advance directives should apply if they were in a permanent coma.

It may be helpful to compare the information in this "Permanent Coma" topic with the information in the  "Terminal Condition" topic.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE

 ARTIFICIAL NUTRITION/HYDRATION

 DURABLE POWER OF ATTORNEY

 HEALTH CARE DOCUMENTS

 HEALTH CARE POWER OF ATTORNEY

 HOLD HARMLESS

 LIFE SUSTAINING PROCEDURES

 LIVING WILL

 OKLAHOMA - ATTORNEY GENERAL OPINION

 OTHER REQUESTS

 PREGNANCY

 SPECIFIC MEDICAL PROCEDURES


 Life-Sustaining Procedures

 Most states have a specific definition of "life-sustaining procedures".  Generally, a life-sustaining procedure means any medical procedure or intervention that (i) uses mechanical or other artificial means to sustain, restore, or supplant a vital function, and (ii) only prolongs the moment of death.

Some states use other terms, including "life-prolonging procedures", "death-delaying procedures", "death-prolonging procedures", "medical maintenance treatment", and "extraordinary procedures" for life-sustaining procedures.

Please refer to the  "Terminal Condition",  "Permanent Coma", and  "Artificial Nutrition/Hydration" topics for a better understanding of these related items.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 SAMPLE PROVISIONS


 Artificial Nutrition/Hydration

 The term "artificial nutrition/hydration" generally means food and water that is provided to a person through an artificial means such as "feeding tubes", "tube feeding" or "intravenously", rather than through the mouth.  Because food and water is such a basic necessity to life itself, there have been concerns in the past as to whether a person should be permitted to request that food and water not be provided, even if the food and water was provided by an artificial means.  A U.S. Supreme Court case decided in 1989 makes it clear that a person can state his or her preference not to receive artificially administered food and water.

For more information, see:

 HEALTH CARE DOCUMENTS

 HOLD HARMLESS

 LIFE SUSTAINING PROCEDURES

 OKLAHOMA - ATTORNEY GENERAL OPINION

 OTHER REQUESTS

 PERMANENT COMA

 PREGNANCY

 SPECIFIC MEDICAL PROCEDURES

 TERMINAL CONDITION


 Specific Medical Procedures

 Many states suggest that "other" specific directions of the Declarant can be included in an advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive). For example, you (the Declarant) may wish to specifically state that you do (or do not) want to receive certain types of treatment, for example, cardiac resuscitation, mechanical respiration, surgery, diagnostic tests that involve limited surgical procedures, chemotherapy, or other medications that have painful or unpleasant side effects.

For more information, see:

 AGENT

 ANATOMICAL GIFTS

 ARTIFICIAL NUTRITION/HYDRATION

 AUTOPSY

 GUARDIAN OR CONSERVATOR

 HEALTH CARE DOCUMENTS

 HOLD HARMLESS

 LIFE SUSTAINING PROCEDURES

 MICHIGAN - PATIENT ADVOCATE ACCEPTANCE

 MISSISSIPPI - DISCLOSURE STATEMENT

 OKLAHOMA - ATTORNEY GENERAL OPINION

 OTHER REQUESTS

 PERMANENT COMA

 PREGNANCY

 SAMPLE PROVISIONS

 SEVERABILITY

 TERMINAL CONDITION


 Pregnancy

 Many states have provisions that specify to what extent an advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive) is effective during any period that the Declarant is pregnant. These statutes generally fall into three categories: (i) the advance directive has no effect during the Declarant's pregnancy, (ii) the advance directive has no effect if the fetus could develop to live birth if life-sustaining procedures are continued, or (iii) the statute is silent on the pregnancy question.

  Abortion

The U.S. Supreme Court has held that a woman may choose to have an abortion, at least during the first part of the pregnancy.  If a woman has the right to decide to have an abortion, it seems consistent to expect that a woman could also choose to withhold or withdraw medical treatment even though a result of that decision might be that the fetus might not survive.  Therefore, statutes that limit the effect of an advance directive during pregnancy may be unconstitutional because of their infringement on a woman's right to make decisions regarding her body.

  Optional Provisions of Living Will and Advance Health Care Directives

This program offers optional provisions regarding pregnancy with respect to the Living Will and Advance Health Care Directive documents.  Maximum flexibility is offered by allowing the user to state a preference regarding the effect of the advance directive during pregnancy, even though that stated preference may differ from the user's state statute. For example, the Alabama Living Will statute provides that a Living Will shall have no effect during pregnancy.  This program allows the user to state, as a preference, that the Living Will should be given effect if it is determined that the fetus could not survive, even if life-sustaining procedures are continued.

The following states have statutes that provide that an advance directive has no effect during a pregnancy of the Declarant or Principal: Alabama, California, Connecticut, Delaware, Hawaii, Idaho, Indiana, Kansas, Kentucky, Mississippi, Missouri, New Hampshire, Oklahoma, South Carolina, Texas, Utah, Washington, Wisconsin, and Wyoming. In Michigan, treatment may not be withheld or withdrawn from a pregnant Declarant or Principal if it will result in the death of the Declarant or Principal.

The following states have statutes that provide that an advance directive has no effect if the fetus could develop to live birth if life-sustaining procedures are continued: Alaska, Arizona, Arkansas, Colorado, Georgia, Illinois, Iowa, Minnesota, Montana, Nebraska, Nevada, North Dakota, Ohio, Pennsylvania, Rhode Island, and South Dakota.

The following states do not indicate what effect a pregnancy will have on the effectiveness of an advance directive: District of Columbia, Florida, Louisiana, Maine, Maryland, Massachusetts, Michigan, New Jersey, New Mexico, New York, North Carolina, Oregon, Tennessee, Vermont, Virginia, and West Virginia.

One state, New Jersey, specifically provides that a Declarant or Principal may state in an advance directive what effect a pregnancy will have on the advance directive.

Although specific "pregnancy" options are not offered in the Health Care Power of Attorney document, the user may choose to include a statement regarding pregnancy as an "Other Request".  Because the Health Care Power of Attorney is intended generally to apply to any health care decision (unless specifically limited), a statement regarding pregnancy should be written so that it applies only to the Agent's decisions regarding life-sustaining procedures during a pregnancy.  Generally, a Principal would not want a pregnancy clause that restricted the Agent's authority with respect to health care decisions that did not involve the withholding or withdrawal of life-sustaining procedures.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 SEVERABILITY


 Anatomical Gifts

 The term "anatomical gifts" refers to the designation of the intent to donate a vital organ, or part or all of a human body, effective after the Declarant's death, generally for transplant or medical research.  Most states have adopted the Uniform Anatomical Gift Act which authorizes such gifts after death.  The advance directive statutes of a few states include sample Living Will or Health Care Power of Attorney forms that have "anatomical gifts" or "donation of organs" sections that refer to the intent of the Declarant to make an anatomical gift.  This program offers this provision in the Advance Health Care Directive, as well as the Living Will and Health Care Power of Attorney documents for the states that specifically include an "anatomical gifts" section in their sample forms.  This program also offers an Organ Donation form for an individual to make a gift of organs or tissues which takes effect on the individual's death.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 AUTOPSY


 Autopsy (Memorial Services)

 An "autopsy" is an examination of the body after death by a medical expert, usually conducted to determine the cause(s) of death.  Except for deaths that appear to have occurred under suspicious circumstances, government officials generally do not have the authority to conduct an autopsy, unless the consent of the dead person's legal representative (e.g., an executor or surviving spouse) is obtained. Please refer to the  "Donation/Anatomical Gifts" topic for related information.

For more information, see:

 MEMORIAL SERVICES


 Autopsy

 An "autopsy" is an examination of the body after death by a medical expert, usually conducted to determine the cause(s) of death. Except for deaths that appear to have occurred under suspicious circumstances, government officials generally do not have the authority to conduct an autopsy, unless the consent of the dead person's legal representative (e.g., an executor or surviving spouse) is obtained.  The advance directive statutes of a few states include sample living will or health care power of attorney forms that have provisions regarding the Declarant's consent to an autopsy. This program offers an "autopsy" option in the Advance Health Care Directive so that you (as the Declarant) can state your wishes regarding your consent to an autopsy. Please refer to the  Anatomical Gifts topic for related information.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE


 Other Requests

You (as the Declarant or Principal) may also choose to include a statement regarding religious or moral beliefs. If you include other provisions, it is recommended that these provisions be stated as preferences.  For example, you could begin the provision with the phrase, "It is my preference that . . .".

An important related topic is the  "Specific Medical Procedures" topic.

For more information, see:

 ANATOMICAL GIFTS

 ARTIFICIAL NUTRITION/HYDRATION

 AUTOPSY

 HEALTH CARE DOCUMENTS

 HOLD HARMLESS

 LIFE SUSTAINING PROCEDURES

 LIVING WILL

 MICHIGAN - PATIENT ADVOCATE ACCEPTANCE

 MISSISSIPPI - DISCLOSURE STATEMENT

 OKLAHOMA - ATTORNEY GENERAL OPINION

 PERMANENT COMA

 PREGNANCY

 SAMPLE PROVISIONS

 SEVERABILITY

 SPECIFIC MEDICAL PROCEDURES

 TERMINAL CONDITION


 Guardian or Conservator

 A "guardian or conservator of the person" is a person who is appointed by a court to make decisions for the general welfare of a person (often called a "ward"), if the court has determined that the ward is no longer competent to make such decisions on his or her own behalf.  The authority of a guardian or conservator to make decisions for the "general welfare" of a ward probably includes the power to make at least some kinds of health care decisions.

This program offers a "guardian nomination" option in the Advance Health Care Directive so that you (as the Declarant) can nominate your choice of a person who would become your guardian or conservator, if that became necessary.  In many cases, the person named as the Agent in the Advance Health Care Directive would be the logical choice to serve as the guardian.  See also the  "Signatures - Advance Directives" topic.

For more information, see:

 AGENT

 HEALTH CARE DOCUMENTS

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 OTHER REQUESTS

 SIGNATURES - ADVANCE DIRECTIVE

 WITNESSES


 Hold Harmless

 A "hold harmless" provision provides protection to the health care providers and other persons (possibly an Agent) who carry out the wishes of the Declarant (or Principal) under an advance directive. This type of protection encourages such persons to honor the wishes of the Declarant.

For more information, see:

 AGENT

 GUARDIAN OR CONSERVATOR

 HEALTH CARE DOCUMENTS

 LIVING WILL

 MICHIGAN - PATIENT ADVOCATE ACCEPTANCE

 MISSISSIPPI - DISCLOSURE STATEMENT

 OKLAHOMA - ATTORNEY GENERAL OPINION

 SEVERABILITY

 SPECIFIC MEDICAL PROCEDURES

 TERMINAL CONDITION


 Severability

 The severability paragraph provides some protection against the possibility that an entire advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive) might be declared invalid simply because state law does not permit a specific provision that was included in the advance directive.  For example, it is possible that you could choose to add an unusual "other" provision that would not be enforceable.  If that occurred, the inclusion of the severability paragraph would provide protection against the possibility that the unusual provision would cause the entire advance directive to be invalid.

The U.S. Supreme Court has made it clear that all persons should be free to state their preferences in advance directives.  Thus, if your wishes are stated as preferences, the risk should be limited to the possibility that your preference would simply not be followed if state law somehow did not permit what you requested. You are not risking that the other provisions of your advance directive could be held invalid simply because the state has decided that your preference cannot be followed.  The following example illustrates this point.

Some states have not yet responded to recent changes in health law that clearly permit a person to include additional specific provisions in an advance directive.  For example, some states have not yet amended their advance directive statutes to make it clear that a person can (i) request that life-sustaining procedures be withheld or withdrawn if the person is in a permanent coma, (ii) request that artificial hydration/nutrition be withheld or withdrawn, (iii) specify a preference regarding the effect of a pregnancy, or (iv) appoint an agent to make health care decisions for the Declarant.  Although it is believed that each person has the right to include provisions regarding the above matters, a severability paragraph provides protection against the possibility that the inclusion of one of these provisions would cause the other provisions of the advance directive to be invalid.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 PREGNANCY


 Signatures - Advance Directive

 The advance directive documents (Living Will, Health Care Power of Attorney, or Advance Health Care Directive) include lines for the signature of the Declarant (or Principal) and the date that the document is signed.  In some cases, the date appears both at the beginning of the document and at the signature line.  The advance directive should be reviewed at time that it is signed to make sure that all date lines and signature lines have been completed.

  Artificial Nutrition/Hydration

With respect to the Living Will and Health Care Power of Attorney documents for some states, the selection of the Declarant (or Principal) regarding the use of artificial nutrition/hydration and/or other matters might require initials or an additional signature.  The Living Will and Health Care Power of Attorney documents should be reviewed carefully to make sure that other required signature or "initial" lines are signed or initialed.

It is important that you (the Declarant or Principal) discuss your advance directive with your physician or other health care providers before you sign it to be sure that you understand the nature and range of decisions that may be made on your behalf.  If you do not have a physician, you should talk with another health care provider, attorney, social worker, or pastor, who is knowledgeable about these issues and can answer your questions.

  Competency

Competent or Competency.  "Competency" is the mental ability to understand the general effect of a transaction or document. Generally, every adult is presumed to be competent to execute an advance directive.  However, if an individual has a court appointed guardian or conservator, or has been determined incompetent, you should consult an attorney who is familiar with your state's laws regarding competency and advance directives to obtain advice regarding the appropriate method of making health care decisions for such a person.

  Copies to Health Care Providers

Copies.  After the advance directive has been signed, dated, and witnessed or notarized as appropriate, you (as the Declarant or Principal) should provide copies of the advance directive to your physician or other health care providers, your Agent and alternate Agent (if any), family members, and significant other persons in your life.  In addition, you may wish to provide copies to your local hospital, and possibly a member of the clergy.  It is helpful to indicate in the document itself who has received copies.  If you are served by a home health care agency or admitted to any type of health care facility, a copy of this document should be included in your medical record.

  Right to Make Health Care Decisions

Patient Self Determination Act.  Hospitals and other health care providers are now required under the Patient Self Determination Act to provide patients with information regarding the rights of patients to make their own health care decisions, including the right to accept or refuse medical treatment.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE

 AGENT

 DURABLE POWER OF ATTORNEY

 GUARDIAN OR CONSERVATOR

 HEALTH CARE DOCUMENTS

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 MICHIGAN - PATIENT ADVOCATE ACCEPTANCE

 MISSISSIPPI - DISCLOSURE STATEMENT

 NOTARY

 OKLAHOMA - ATTORNEY GENERAL OPINION

 WITNESSES


 Witnesses

 There are restrictions on who may be a witness to the execution of an advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive).  The restrictions are included in the statement that precedes the signatures of the witnesses. The witness requirements should be carefully reviewed prior to the execution of the advance directive.  IF THE ADVANCE DIRECTIVE IS NOT WITNESSED PROPERLY BY QUALIFIED WITNESSES, IT MAY NOT BE ENFORCEABLE.

It may be helpful to also review the  "Notary" topic.

For more information, see:

 AGENT

 GUARDIAN OR CONSERVATOR

 HEALTH CARE DOCUMENTS

 NOTARY

 SIGNATURES - ADVANCE DIRECTIVE


 Notary

 A few states require that the signatures of the Declarant (or Principal) and/or the  witnesses be notarized.  In other states, witnesses are not needed if the signature of the Declarant (Principal) is notarized. This program provides a notary section, depending on state requirements.

For more information, see:

 HEALTH CARE DOCUMENTS

 SIGNATURES - ADVANCE DIRECTIVE

 WITNESSES


 Revocation of Advance Directive

 It is possible to revoke an advance directive (Living Will, Health Care Power of Attorney, or Advance Health Care Directive) after it has been made by executing a new advance directive or by using the Revocation of Advance Directive document provided by this program.  Many states specify that an advance directive may be revoked at any time and in any manner.  However, the best method is to provide a signed and dated, written revocation to the Agent (if any) and the appropriate health care providers.  Although other documents require a witness or notary, legal principles encourage the recognition of a revocation without the necessity of such formalities.  IN MANY STATES, THE REVOCATION DOCUMENT MAY BE CONSIDERED INEFFECTIVE UNTIL YOUR AGENT AND/OR PHYSICIAN HAVE BEEN NOTIFIED OF THE REVOCATION.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE

 HEALTH CARE DOCUMENTS

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL


 Sample Provisions

 Several states include "statutory" document forms as part of their Health Care Power of Attorney acts that must be used and SHALL be the only form by which a person may execute a Power of Attorney for Health Care.  For this reason, this program has not included suggested language for certain provisions that the state form has left blank.  However, the following sample provisions are provided for your reference in composing your own statement of desires.

*  I specifically direct my Agent to follow any "Declaration" to Physicians (Living Will) executed by me.

*  I do not want my life to be prolonged nor do I want life-sustaining procedures to be provided or continued if my Agent believes the burdens of the treatment outweigh the expected benefits.  I want my Agent to consider the relief of suffering, the expense involved and the quality as well as the possible extension of my life in making decisions concerning life-sustaining procedures.

*  I do not want my life to be prolonged and I do not want life-sustaining procedures, except to the extent deemed necessary to provide me with comfort care, if I have a condition that is incurable or irreversible and, without the administration of life-sustaining procedures, expected to result in death within a relatively short time, or if I am in a coma or persistent vegetative state which is reasonably concluded to be irreversible.

*  I want my life to be prolonged to the greatest extent possible without regard to my condition, the chances I have for recovery, or the cost of the procedures.

For more information, see:

 HEALTH CARE POWER OF ATTORNEY


 Oklahoma - Attorney General Opinion

 In 1992, the Oklahoma Rights of the Terminally Ill or Persistently Unconscious Act was adopted.  This Act provides for an advance directive which may include a living will, an appointment of a health care proxy, or both.  Please select the Oklahoma version of this program's Living Will document in order to complete an "Advance Directive for Health Care".

For more information, see:

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL


 Michigan - Patient Advocate Acceptance

The Michigan Durable Power of Attorney for Health Care Act (the "Michigan Act") provides that before a Patient Advocate (a term for "Agent") may act for the Declarant, two conditions must be satisfied:

1.  A copy of the document must be given to the proposed Patient Advocate.  If the proposed Patient Advocate is unable to serve, a copy must be given to the Successor Patient Advocate.

2.  The Patient Advocate must sign an acceptance of the designation, or if the proposed Patient Advocate is unable to serve, the Successor Patient Advocate must sign an acceptance of the designation.

The Declarant will not be in a position to assure that these two conditions are satisfied at the time that the authority is needed, because by definition the Declarant is unable to make decisions. Therefore, the acceptance of the designation as required by the Michigan Act has been included in the Advance Directive for Declarants residing in the state of Michigan.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE

 DURABLE POWER OF ATTORNEY

 GUARDIAN OR CONSERVATOR

 HEALTH CARE DOCUMENTS

 HEALTH CARE POWER OF ATTORNEY

 LIVING WILL

 SIGNATURES - ADVANCE DIRECTIVE


 Mississippi - Disclosure Statement

 The Mississippi Durable Power of Attorney for Health Care Act (the "Mississippi Act") states that in order for an Agent to make health care decisions for the Declarant,  the document must "substantially comply" with the Act.  The notice to persons executing this document is set forth in the Mississippi Act, and is included in the Advance Directive for Declarants residing in the state of Mississippi.

For more information, see:

 ADVANCE HEALTH CARE DIRECTIVE

 HEALTH CARE DOCUMENTS

 LIVING WILL


 Copies

 You should keep a copy of this document after you have signed it. Give a copy to the person you name as your  Agent, your Alternate Agent, your physician or other health care provider, and family members.  It is helpful to indicate in the document itself who has received copies.  If you are served by a home health care agency or admitted to any type of health care facility, a copy of this document should be included in your medical record.

For more information, see:

 HEALTH CARE DOCUMENTS


 Virginia - Health Care Decisions Act

 Virginia enacted a Health Care Decisions Act in 1992 which sets forth a suggested form that incorporated the provisions of both a Living Will and Health Care Power of Attorney. Please select the Virginia Advance Directive to make an "Advance Medical Directive."


Authorization for Transfer of Medical Information

 The law makes a distinction between the ownership of the physical property constituting a medical record, and the content of medical records.  Most states recognize that the physical health care records are the property of the health care provider who compiles, stores and maintains the data. However, the patient has a legitimate interest in the information in the health record.  Therefore, this information can only be released with the written authorization of the patient, or the patient's legal representative, or as permitted by law.  Only copies of the record will be released, because the provider maintains the original record.  Providers can charge a fee for copying the medical records file.

Many health care providers have very specific procedures regarding the release of medical records because of confidentiality concerns, and the special protection requirements for certain types of records such as HIV, alcohol, and drug information.  Many health care providers will only use a consent form generated by their legal counsel to assure that they are complying with the various regulations.  YOU SHOULD FIRST CHECK WITH YOUR HEALTH CARE PROVIDER TO DETERMINE WHETHER IT HAS A FORM IT PREFERS TO USE.  If not, this program's request for Transfer of Medical Records can be used.

THIS PROGRAM'S TRANSFER OF MEDICAL RECORDS IS NOT INTENDED TO BE USED FOR THE RELEASE OF MEDICAL RECORDS FOR LITIGATION PURPOSES, OR A RELEASE OF INFORMATION TO A THIRD PARTY PAYOR.  Contact your attorney if such a release is needed.

A prohibition for redisclosure is also included to prohibit the release of the information without further consent of the patient.  Also, a health care provider cannot deny the release of medical records because the patient has outstanding medical bills.

For more information, see:

 DISCLOSURE WITHOUT CONSENT

 HIV/AIDS RELATED INFORMATION

 MENTAL HEALTH TREATMENT RECORDS

 REDISCLOSURE

 SPECIALLY PROTECTED MEDICAL INFORMATION

 SUBSTANCE ABUSE MEDICAL RECORDS

 VALIDITY


Specially Protected Medical Information

 Under federal law all medical records are confidential. Laws relating to the access to health records are not uniform among all states.  However, federal law regulates records generated in the treatment of substance abuse. This program's form also has special categories for HIV/AIDS related information and mental health treatment records. The reason for special treatment of these types of records is to encourage diagnosis and treatment of potentially highly stigmatized conditions or illnesses without the fear of public disclosure.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 DISCLOSURE WITHOUT CONSENT

 HIV/AIDS RELATED INFORMATION

 MENTAL HEALTH TREATMENT RECORDS

 REDISCLOSURE

 SUBSTANCE ABUSE MEDICAL RECORDS

 VALIDITY


Validity

 In general, no disclosure of medical records can be made unless the patient or the patient's legal guardian executes a release specifically releasing the information.  The release should specify to whom disclosure is permitted. Further, the release should specify the name of the provider to whom the release is directed.  The consent should state that it is effective for a limited period of time with a maximum validity of one year.  This insures that the consent will last no longer than necessary.  The consent is also subject to revocation at any time, except if someone has relied upon the consent and has already taken action.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 DISCLOSURE WITHOUT CONSENT

 HIV/AIDS RELATED INFORMATION

 MENTAL HEALTH TREATMENT RECORDS

 REDISCLOSURE

 SPECIALLY PROTECTED MEDICAL INFORMATION

 SUBSTANCE ABUSE MEDICAL RECORDS


Redisclosure

 Persons who release medical records without first obtaining the appropriate authorization are liable for breach of confidentiality in most jurisdictions.  Any adult or a person's legal representative may consent to a transfer of medical records.  You should keep a copy of the authorization and provide one to the health care provider to be kept in your medical file folder.  The exceptions to the consent requirement are very narrow and vary by state. Whenever information is disclosed, it must be accompanied by a statement prohibiting redisclosure of substance abuse information, or other information protected by state law. NOTE: Disclosure to another practitioner should be done with written consent.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 DISCLOSURE WITHOUT CONSENT

 HIV/AIDS RELATED INFORMATION

 MENTAL HEALTH TREATMENT RECORDS

 SPECIALLY PROTECTED MEDICAL INFORMATION

 SUBSTANCE ABUSE MEDICAL RECORDS

 VALIDITY


Mental Health Treatment Records

 Some state laws protect the confidentiality of mental health information.  For example, records of individuals receiving services from a mental health professional relating to diagnosis, course of treatment, or care of a mental or emotional condition.  To be protected such records must generally be provided by an individual who has at least a master's degree in a mental health field, is licensed under state law to provide such services, and has a certain amount of clinical experience in assessing mental health needs and problems and in providing appropriate mental health services.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 DISCLOSURE WITHOUT CONSENT

 HIV/AIDS RELATED INFORMATION

 REDISCLOSURE

 SPECIALLY PROTECTED MEDICAL INFORMATION

 SUBSTANCE ABUSE MEDICAL RECORDS

 VALIDITY


Substance Abuse Medical Records

 Current federal regulations control the release of information from drug and alcohol abuse patients' medical records.  The regulations were designed to encourage alcohol and drug abusers to seek treatment without fear of public disclosure.  The regulations require that records of the identity, diagnosis, prognosis, or treatment of any patients kept in the performance of any federally assisted alcohol or drug abuse prevention function be kept confidential.

An alcohol abuse or drug abuse program is considered to be federally assisted if it is conducted directly or indirectly, in whole or in part, by any department or agency of the United States (i.e., contract, license, or certification by the U.S.), pursuant to receiving federal funds including Medicare and Medicaid payments, or by virtue of an income tax exemption from the IRS.

A covered program includes, but is not limited to, those treatment or rehabilitation programs, employee assistance programs, programs within general hospitals, school based programs and private practitioners who hold themselves out as providing, and provide alcohol drug abuse diagnosis, treatment, or referral treatment and are federally assisted as defined in the rules.

The regulations cover any record identifying a patient as a drug or alcohol abuser which is prepared in connection with the treatment or referral of the patient for treatment of alcohol or drug abuse.  The following are not covered:

1. 	Diagnosis prepared solely for purpose of providing evidence for use of law enforcement authorities.

2. 	A diagnosis of drug overdose or alcohol intoxication which clearly shows individual involved is not an alcohol or drug abuser (i.e., accidental ingestion, overdose prescription medications, involuntary ingestion of alcohol).

  Release of Information

The general rule under the federal regulations state that no information which identifies the patient may be released without the patient's written authorization.

The federal regulations provide that where a state has a law that authorizes drug or alcohol abuse treatment to minors without parental consent, then the consent of the minor is all that is needed for disclosure of information.  However, if the extreme youth or mental or physical condition of the patient prevents the minor from making a rational decision concerning consent to disclose, or there is a substantial threat to the patient's life or well being, or that of another, information may be released to a parent or guardian to the extent that the best interests of the patient are protected.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 DISCLOSURE WITHOUT CONSENT

 HIV/AIDS RELATED INFORMATION

 MENTAL HEALTH TREATMENT RECORDS

 REDISCLOSURE

 SPECIALLY PROTECTED MEDICAL INFORMATION

 VALIDITY


Disclosure Without Consent

 A valid consent form must include the date it was signed and the signature of the Patient.  A guardian or other person serving in a representative capacity may sign the consent for a minor or a patient who is incompetent.

The following are the limited situations in which disclosure may be permitted without the express consent of the patient:

1. 	When a true medical emergency exists.

2. 	Information may be released to the Food and Drug Administration (FDA) without the patient's consent if there has been an FDA determination that a drug is dangerous.

3. 	Some states permit information from the patient's medical record to be made available for purposes of research into the causes and treatment of chemical substance abuse.

4. 	Health care professionals who have a legitimate need for the information may have access to patients' records appropriate to their responsibilities, as determined by policies of the facility.

5. 	Information may be released to qualified organizations performing such services as data processing, medical record transcription, microfilming or other such related services. In these situations, there must be a written agreement between the facility and the organization performing the services which states that the organization will institute necessary procedures to safeguard patient-identifying information.

  Disclosure of Information To Attorney

Information may be released to an attorney with the proper written authorization of the patient.  HOWEVER, THIS FORM IS NOT INTENDED FOR SUCH USE.

  Disclosure of Information to Law Enforcement Officers

Federal regulations prohibit disclosure of information, without the authorization of the patient, to law enforcement officers or law enforcement agencies which identify a person as receiving chemical substance abuse treatment.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 HIV/AIDS RELATED INFORMATION

 MENTAL HEALTH TREATMENT RECORDS

 REDISCLOSURE

 SPECIALLY PROTECTED MEDICAL INFORMATION

 SUBSTANCE ABUSE MEDICAL RECORDS

 VALIDITY


HIV/AIDS Related Information

 No disclosure should be made of HIV/AIDS test results unless the patient or the patient's legal guardian executes a release specifically releasing the information.  Until recently, a request for release of medical information to health care providers allowed the release of all medical records.  Recent developments in specially protected categories of medical information would indicate that it is not legally sufficient to permit release of HIV/AIDS information unless it is specifically authorized.

Because HIV information is afforded special protection, it is prudent for any health care provider to devise procedures to prevent the unauthorized disclosure of such information. Methods within the office or institution should be devised to ensure that even within the office or institution that information concerning HIV be disclosed only to those with a medical need to know.

With regard to disclosure outside the office or institution, the record keeper should have some method of identifying those records that contain HIV/AIDS information so that a specific release can be obtained.  A specific release must be obtained and any medical records being sent out with HIV/AIDS information must also bear the redisclosure warning.

For more information, see:

 AUTHORIZATION FOR TRANSFER OF MEDICAL INFORMATION

 DISCLOSURE WITHOUT CONSENT

 MENTAL HEALTH TREATMENT RECORDS

 REDISCLOSURE

 SPECIALLY PROTECTED MEDICAL INFORMATION

 SUBSTANCE ABUSE MEDICAL RECORDS

 VALIDITY


Organ Donation Form

 Organ donations are often referred to as "anatomical gifts". All fifty states have passed some version of the Uniform Anatomical Gift Act, generally providing that individuals may make a gift of their organs and tissues during their lifetime with the gift to take effect on their death. Additionally, family members may generally donate organs and tissues of a deceased individual if there is no indication the deceased individual had been opposed to such a donation. It is therefore important for individuals to document their wishes concerning organ donation.

 Options

Consistent with the latest version of the Uniform Anatomical Gift Act, this program provides users the opportunity to:

- 	make a donation of organs and tissues to take effect on death,

- 	amend or revoke a prior organ donation, or

- 	document the refusal to make an organ donation.

Users are referred to this program's separate document, "Refusal to Donate Form" for more information on documenting a refusal to make an organ donation.

For more information, see:

 BRAIN DEATH AND ORGAN DONATION PROCEDURES

 DESIGNATED DONEES

 DESIGNATED INDIVIDUALS TO PERFORM PROCEDURES

 DONATIONS BY OTHERS

 DONATIONS ON DRIVERS' LICENSES

 ALTERNATIVE REVOCATION METHODS

 EXTRA STEPS AT REVOCATION

 HOSPITAL PROCEDURES

 MAKING THE DONATION

 MEDICAL SCREENING

 MINORS AS DONORS

 ORGAN DONATIONS DURING LIFE

 ORGANS DONATED

 RECENT TRENDS

 REVOCATION OR AMENDMENT OF PRIOR DONATIONS

 SEVERABILITY

 SIGNATURES

 STATE SPECIFIC DONATIONS

 THE USE OF ORGANS

 WITNESSES


Making The Donation

 In general, the laws of all states provide that an individual may make an organ donation by completing a document.  Generally the document may be a card carried with the individual, may be imprinted on or attached to a driver's license, or may be any other document.  Organ donations may also be valid if contained in a will.  The use of a will as the only method to donate organs is not recommended because such instructions might not be made known in time to allow organs or tissues to be donated.

 State Variations

State laws have varying requirements for organ donation forms.  To increase the likelihood that this program's Organ Donation Form will be recognized in a variety of states, more information is requested on this program's form than is required in some states.  The Organ Donation Form does add some state specific information that will be automatically incorporated into documents if a Donor resides in certain states. Ohio and Mississippi require than an organ donation document substantially conform to the form provided in Ohio and Mississippi State law.  Residents of Ohio and Mississippi are encouraged to complete the Ohio or Mississippi Organ Donation Forms. If the Donor has specific questions about their state's requirements it is recommended that the Donor contact an attorney.  Donors can contact a local hospital or another health care agency or institution for more information about organ donation in their particular states.

Donors are encouraged to read the topic,  Donations by Others, for information on the important role that family members play in the organ donation process.

For more information, see:

 HOSPITAL PROCEDURES

 ORGAN DONATION

 RECENT TRENDS


Organs Donated

 Unless the Donor specifically desires to exclude certain organs, tissues, or parts from donation, it is recommended that the Donor simply indicate that "any needed organs, tissues, or parts" are donated.  Checking the "any needed" option provides flexibility to allow the greatest possible use of a Donor's organs, tissues, and parts after death.

 Body Donations

Some organ donation forms allow an individual to make an anatomical gift of the entire body.  However, the donation of one's entire body often requires specific arrangements with the designated recipient of the body, such as a medical school.  Consistent with the most recent Uniform Anatomical Gift Act, this program's document is not designed for donation of an entire body.  The user should contact a medical school if they desire to make such a donation.

Donors are encouraged to read the topic,  Brain Death and Organ Donation Procedures, for more information on the circumstances under which some organs can be used for transplantation.

For more information, see:

 ORGAN DONATION

 ORGAN DONATIONS DURING LIFE

 THE USE OF ORGANS


The Use Of Organs

 The Uniform Anatomical Gift Acts provide that organs, tissues, or parts may generally be used for transplantation, therapy, research, and medical education.  However, it is not always possible for organs and tissues to be used for all purposes.  Some organs or tissues may not be used if it would interfere with an autopsy or another investigation. Additionally, if a Donor suffers from particular diseases or dies under certain circumstances, the Donor's organs and tissues may not be suitable for transplantation.  Certain medical tests will be completed to assure that organs and tissues are acceptable for transplantation or therapy. Organs and tissues not useful for transplantation or therapy may be useful for research or education.

Users are encouraged to read the topic,  Medical Screening, for important information about testing for the HIV virus.

For more information, see:

 ORGAN DONATION


Designated Individuals To Perform Procedures

 Donors may indicate a physician or surgeon to carry out the procedure in the "Limitations or Special Wishes" section of the form.  Donors should note that not all physicians or surgeons would be qualified or willing to carry out the necessary procedures to remove organs and tissues for donation.  Additionally, the laws of some states do not allow an attending physician or physicians designated as donees to perform retrieval procedures.  If there is no individual designated on a donor form to perform the procedures or if that individual is unavailable, appropriate individuals will be authorized to carry out the procedures.

 Appropriate Individuals

State laws vary on what individuals are allowed to remove organs and tissues.  Generally, physicians, surgeons, specially trained technicians or procurement specialists, and individuals specially trained in eye removal, may remove organs and tissues.  The Acts, however,  generally provide that donors can only designate physicians or surgeons.

For more information, see:

 ORGAN DONATION


Designated Donees

 The Uniform Anatomical Gift Acts allow a donor to designate a "donee," the individual or institution who is to receive the donated organs and tissues.  HOWEVER, since not all donees can use a donation for any purpose, care must be taken to avoid inadvertently restricting or essentially revoking a donation.  For example, a medical or dental school, college or university is generally not authorized to use organs or tissues for transplantation or, in some states, for therapy.  Individuals, except for physicians and surgeons, can only use organs or tissues for transplantation or therapy needed by that individual.  Donors from Ohio, Vermont, Utah, Virginia, and Texas should read the "State Limitations" Section below.

 Use Caution

A Donor who desires to narrowly limit a donation to a specified donee is encouraged to contact the donee (such as a medical school or hospital) or an organ procurement organization in the Donor's state to assure the necessary steps are taken and the form is completed correctly to accomplish the Donor's specific goal.

 If No Donee Designated

If there is no designated donee or the designated donee is not available or rejects the donation, depending on the specific state law either the attending physician or any hospital can generally accept the donation.  Once a donee accepts organs and tissues, that donee can then transfer the organ and tissues so that the tissues are ultimately received by a party who will use them.  There is a national system to allocate organs to individuals who need them for transplantation.  Factors such as the urgency of the prospective recipient's need for the organ, the closeness of the biological match between the donor and prospective recipient, and geographic proximity help determine who receives donated organs.

 Acceptable Donees

In general, the following are acceptable donees: hospitals; surgeons; physicians; accredited medical or dental schools, colleges, or universities; organ/tissue banks or storage facilities; organ procurement organizations; or a specified individual who needs an organ or tissues for therapy or transplantation.  Some states have additional permissible donees, such as schools of veterinary medicine, nursing schools, or Health Departments.  Mississippi actually incorporates acceptable donees and the purposes for which a donation can be used into the donor form.

 State Limitations

Several states additionally limit who can accept donations. Ohio, Vermont, and Utah limit donees to:

- 	hospitals, surgeons, physicians or recovery agencies (able to receive gifts for any purpose authorized by law) or

- 	medical or dental schools, colleges, or universities (able to receive gifts for education, research or the advancement of medical or dental science).

Donors should note that the above states do not list individuals in need of transplant as acceptable donees. Virginia also does not list individuals in need of a transplant as acceptable donees. In Texas, an individual who needs an organ or tissues for transplant or therapy must be specified by a physician.

For more information, see:

 ORGAN DONATION


Revocation Or Amendment Of Prior Donations

 Revocation

 To avoid any confusion that may arise if more than one donor form is located after a Donor's death, it may be advisable to revoke old donor forms when a new donation form is completed.  If a Donor has previously completed a donor form and now wishes to make changes to that donation, it may be easiest to simply revoke the old form and complete a new form.  Caution: If a previous donation was delivered to a specified donee, many states require that a copy of the revocation or communication of the revocation also be sent to that donee.

 Amendment

If, however, there is something specific on an old donor form that a Donor does not wish to revoke, a new form could be designated as amending the previous form.  For example, many Donors may have signed specific forms for the donation of just eyes or kidneys.  Those forms may be silent about other organs and tissues and a Donor may wish to add the donation of other organs.  Depending on the circumstances, it may be preferable to leave a specific donation in effect and to establish a new form as an amendment.  It is recommended that new donor forms that "amend" previous forms be consistent with previous forms if possible.  For example, if an individual previously completed a form donating only their eyes, it is recommended that the Donor also donate their eyes on the new donor form (unless they have changed their mind on eye donation).

Donors who are revoking or amending a previous form should read the topic,  Extra Steps at Revocation.

For more information, see:

 ALTERNATIVE REVOCATION METHODS

 DONATIONS ON DRIVERS' LICENSES

 ORGAN DONATION


Severability

 The severability paragraph provides some protection against the possibility that an entire organ donation form might be declared invalid simply because a state law does not permit a specific provision that was included in the form.  For example, it is possible that an unusual request under the "Limitations or Special Wishes" section would not be enforceable.  If that occurred, the inclusion of the severability paragraph would decrease the possibility that the unusual provision would cause the entire organ donation form to be invalid.

For more information, see:

 HOSPITAL PROCEDURES

 ORGAN DONATION


Signatures

 All states require that the Donor sign the document making an organ donation. (State laws generally provide that another person may sign on behalf of a Donor who  is physically unable to sign).  Generally individuals must be competent to execute a valid document.  Many states specifically provide that an individual must be of "sound mind" to execute a valid organ donation document.  Some states require that an individual be competent to execute a will to execute a donor form.  Generally, "competency" is the mental ability to understand the general effect of a transaction or document. Generally, every adult is presumed to be competent.  Donors should consult an attorney if they have questions about competency.

 Incompetency

If an individual has a court appointed guardian or conservator, or has been determined incompetent, that individual or their guardian should consult an attorney who is familiar with state laws regarding competency to obtain advice about completing a donor form.  A document completed and signed by an individual who was not competent may not be valid.  In the event that a donor form is invalid, the would-be Donor's family or guardian would likely be asked to make any organ donation decisions.

For more information, see:

 MINORS AS DONORS

 ORGAN DONATION

 WITNESSES


Witnesses

 Some states do not require that an organ donation form be witnessed at all, only signed by the Donor.  The majority of states, however, still require two witnesses for a valid execution of a donor form.  It is recommended that two witnesses sign this program's Organ Donation Form so that it is more likely to be honored in all states.

For the most part, states do not restrict who can witness an organ donation form.  Generally witnesses should be adults, mentally competent and present when the Donor signs the form.  It is generally recommended that witnesses not have an special interest in the donation of the organs such as being designated as a recipient of an organ.

For more information, see:

 MINORS AS DONORS

 ORGAN DONATION

 SIGNATURES


Minors As Donors

 The Uniform Anatomical Gift Acts and the majority of states provide that an individual 18 years of age or older can execute an organ donation document.  Nebraska requires an individual to be 19 years of age.  Maine, and Louisiana under certain circumstances, allow an individual 16 years of age or older to execute a donor document.

 States Allowing Minors To Donate

Some states allow a minor to make a donation, including: Delaware, Indiana, Iowa, Minnesota, Ohio, Virginia, Wyoming, Nevada, South Dakota, Texas.  This program provides for the signature of a minor's parent or guardian as generally required by the states allowing a minor to complete an organ donor form.  Although several states allow a minor 16 years old or older to execute a document, it is recommended that parental or guardian consent be obtained for minors in all states to increase the likelihood that their donations would be honored in any state.

 States That Are Silent

Even in states where state law does not provide that minors can donate organs and tissues, minors are encouraged to complete an organ donation form if they have opinion about the donation of their organs.  A completed form indicates the wishes of a minor and may assist a parent or legal guardian in making a donation decision at a later time.

 Parents Preferred

Some states prefer that parental consent be obtained even if a guardian has been appointed for a minor. Delaware specifically requires parental consent unless a parent is no longer living or no longer has contractual capacity.  This program's form provides for both parents' signatures although this is not required by any state.  If both parents are available and willing to consent to the donation, both signatures on the form may facilitate the actual donation process at a later time.

 State Specifics

There are several state-specific rules concerning donations by minors.  South Dakota and Iowa only allow a minor 14 years old or older to execute a document with the consent of a parent or guardian.  However, even minors under the age of 14 are encouraged to complete a Form to indicate their wishes.  Delaware exempts married minors from the requirement of parental or guardian consent.  Ohio, Wyoming, and Nevada (for a minor 12 or older) requires that one of two witnesses be a parent or guardian.  For Nevada minors under the age of 12, a parent or guardian must sign on behalf of the minor with two additional witnesses and the actual donor need not sign.  Indiana's provision allowing minors to donate is only incorporated into the state's driver's license provisions.  Texas requires parental consent for a form to be valid if the minor actually dies before the age of 18.

For more information, see:

 ORGAN DONATION

 SIGNATURES

 WITNESSES


Donations By Others

 In general, state laws provide which family members or other individuals are authorized to make organ donation decisions concerning a deceased individual's body.  Family members may be involved even if a deceased individual had completed a donor form during life.  For example if the form is invalid for any reason or is not located when an individual dies, the family may be asked to make a donation decision. Additionally, it is common practice for health care providers to ask family members for consent before removing organs and tissues after an individual's death EVEN IF that individual had completed a valid donor form and the form is located.  It is recommended that Donors discuss their wishes with their families and that Donors carry any organ donation form that they have completed in their wallets.

 Who Donates

In many states, individuals are asked to make organ donation decisions concerning deceased individuals in the following order: spouse, adult children, parents, adult siblings, and guardian.  Some states give an attorney-in-fact under a power of attorney document authority to make organ donation decisions.  States differ on whether the attorney-in-fact has priority over family members in decision making and whether the power of attorney instrument must specifically give the attorney-in-fact power to make organ donation decisions.  It is recommended that if an individual desires that an attorney-in-fact have the power to make organ donation decisions, this should be specifically stated in the power of attorney document. Whether the attorney-in-fact will be able to make donation decisions will likely depend on the state law that applies. This program's documents, Health Care Power of Attorney and Advance Health Care Directive, provide the opportunity to make such a designation for those states which permit such designations.

 Medical Examiners And Coroners

Many states also provide that the organs and tissues of a body in the custody of a medical examiner or coroner may be removed under certain circumstances.  Generally, removal is not allowed if there is an objection by the deceased individual's next-of-kin or if it is known that the deceased individual did not want to be an organ donor.

For more information, see:

 ORGAN DONATION

 STATE SPECIFIC DONATIONS


Hospital Procedures

 There has been substantial activity aimed at increasing the availability of organs for transplant purposes since organ demand far exceeds supply.  Many states require that hospitals ask patients if they have completed a donor form or if they would like to do so when they are admitted to a hospital.  Hospitals may also request copies of organ donation forms for an individual's medical record. Additionally, a federal law requires most hospitals to identify potential organ donors and inform their families about the possibility of organ donation near or at the time of death.

For more information, see:

 ORGAN DONATION


Recent Trends

 Some individuals and organizations advocate innovative approaches to increase the supply of organs available for transplantation.  "Presumed Consent" is a system where it is presumed that all individuals would consent to the donation of their organs.  Individuals must specifically state a desire not to be an organ donor to avoid having their organs, tissues, or parts removed at their death.  Some European countries have this system and similar legislation has been introduced (but not passed) in the United States.

For more information, see:

 ORGAN DONATION


Brain Death And Organ Donation Procedures

 "Brain Dead" Donors

 The organ donations made on this program's document take effect on death.  Organs such as the heart, lungs, liver, and pancreas are only useable for transplantation if they are removed from a person whose body is maintained on life support systems after they are declared "brain dead." The circulatory and respiratory functions of a person who is brain dead can be temporarily and artificially maintained until the person's organs can be removed.  The artificial life support is necessary to maintain an adequate blood supply to the organs so they are suitable for transplantation.  Nearly all states legally define death as either the irreversible cessation of all functions of the entire brain (brain death) or the irreversible cessation of circulatory and respiratory functions.  Trauma to the head, bleeding into the brain, and lack of oxygen to the brain are some of the causes of brain death.

 Non Brain-Dead Donors

Most people do not die under circumstances where organs such as the heart and liver can be transplanted into another person; in other words they do not suffer brain death. However, even if a person is not brain dead, some of their organs, tissues, or parts may still be useful.  Such tissues as the cornea, bone, and skin do not need to come from a brain dead person whose body is artificially maintained on life support.  However all organs or tissues must be removed within a relatively short time after death.

 After Removal

Organs are removed after death in such a way as to minimize visible signs of the removal.  Unless other arrangements have been made, the body of a donor is typically available for funeral and burial arrangements after organs and tissues are removed.

For more information, see:

 ORGAN DONATION

 ORGANS DONATED


Organ Donations During Life

 This document only deals with the donation of organs after death.  Donations of organs or tissues before death, such as donating blood, bone marrow, or one kidney, is a completely different process.  Since the donor is alive for such a donation, consent would generally be obtained at that time.

There could be circumstances where a person is alive but unable to give consent to an organ donation.  For example, if a person suffers an injury or disease that results in a comatose state, that person would be unable to communicate and give consent to an organ donation.  If a family member of that person could benefit from a bone marrow or kidney transplant it may be difficult to obtain permission for the comatose person's organ to be transplanted into the needy family member if it is medically feasible to do so.  Courts have dealt with this issue in the context of mentally incompetent individuals with family members who need organ transplants.  Users are encouraged to refer to this program's documents, Health Care Power of Attorney or Advance Health Care Directive for information on designating someone to make health care decisions in the event that the patient is unable to do so.

For more information, see:

 ORGAN DONATION


Medical Screening

 The medical screening associated with the donation of organs and tissues will most likely include testing for infectious diseases such as Hepatitis and the Human Immunodeficiency Virus (HIV), the virus that causes Acquired Immune Deficiency Syndrome (AIDS).  Such testing can generally be done without any additional consent from a donor or a donor's family.  It is possible that a deceased donor's family could be informed if the result of an HIV test was positive.

 HIV Positive Donors

It is a crime in at least one state for an individual to attempt to donate organs or tissues if they know they are HIV positive and know that the HIV virus may be transmitted by a donation.  If an HIV positive individual desires to donate their organs or tissues for purposes such as research and education, this program's Form should not be used. Instead, specific arrangements should be made for such a donation with a medical research or educational facility.

For more information, see:

 ORGAN DONATION


Alternative Revocation Methods

 In general, the Uniform Anatomical Gift Acts provide that an organ donation document may be revoked in any of the following ways:

1. 	a signed statement or document indicating revocation

2. 	an oral statement made in the presence of two individuals

3. 	any communication to a physician during a terminal illness or injury

4. 	delivering a signed revocation to a designated donee

If a previous donation is contained in a will, the donation may be revoked by amending the will.  The Uniform Acts also provide that any of the four options above are effective to revoke a donation made in a will.

For more information, see:

 ORGAN DONATION

 REVOCATION OR AMENDMENT OF PRIOR DONATIONS


Extra Steps At Revocation

 It is important that a revocation of a donor form be communicated to anyone who had previously received a copy of the now-revoked form.  It is recommended that the following actions be considered in addition to indicating a revocation in this program's Form:

- 	If the Donor has a copy of the now-revoked donor form, it is recommended that it be destroyed.

- 	If the Donor had previously sent copies of the now-revoked donor form to other parties, such as a designated donee, it is strongly recommended that a copy of the revocation and any new forms also be sent to those parties.

- 	It is recommended that Donors communicate any revocations of prior donations and their current wishes concerning organ donation to their families.  Family members are often involved in organ donation decisions so is important that they are aware of the existence of completed donor forms or revocations and a Donor's wishes.

For more information, see:

 DONATIONS ON DRIVERS' LICENSES

 ORGAN DONATION


Donations On Drivers' Licenses

 Many states provide that donor information can be or will be incorporated into drivers' licenses and identification cards.  States use the following methods for this purpose:

- 	imprinting or attaching a symbol to a license or card that indicates an individual is a donor or is willing to be a donor;

- 	imprinting an actual donor form on the reverse side of a license or card to be completed when the license or card is issued; and

- 	providing the opportunity for donor form completion at the time of license or card application with a possible indication on the license of an individual's donor status or even filing of donor forms with a state office.

 Revoking License Donations

State laws vary on whether the revocation, suspension, or expiration of a license that contains a donation effectively revokes a donation.  Additionally, states have various methods to revoke such donations, such as crossing through the form on the license, signing a revocation on the back of a license, destroying the card that accompanies a license, or sending written notice to the motor vehicle office.

If a Donor desires to revoke or amend a donation made or reflected on a driver's license the Donor should follow any instructions provided at the time of the donation.  If there are any doubts about the status of a driver's license donation, it is recommended that the state officials responsible for the administration of the drivers' licenses or donor forms be contacted concerning the revocation of a donation.  At the minimum, it is recommended that the Donor carry any new organ donation forms or revocation documents with the license or identification card so that the revocation or new form will likely be discovered.

For more information, see:

 ORGAN DONATION


State Specific Donations

 In general, the laws of all states provide that an individual may make an organ donation by completing a document.  Generally the document may be a card carried with the individual, may be imprinted on or attached to a driver's license, or may be any other document.  Organ donations may also be valid if contained in a will.  The use of a will as the only method to donate organs is not recommended because such instructions might not be made known in time to allow organs or tissues to be donated.

 Ohio and Mississippi

Ohio and Mississippi require that an organ donation document substantially conform to the form provided in Ohio and Mississippi state law.  This program provides the Ohio and Mississippi forms substantially as those forms appear in state law.  This program provides Ohio and Mississippi Donors the opportunity to supplement the standard forms with optional sections and provides Donors with optional language to complete the states' forms.

If the Donor has specific questions about their state's requirements it is recommended that the Donor contact an attorney.  Donors can contact a local hospital or another health care agency or institution for more information about organ donation in their particular states.

Donors are encouraged to read the topic,  Donations by Others, for information on the important role that family members play in the organ donation process.

For more information, see:

 HOSPITAL PROCEDURES

 ORGAN DONATION

 RECENT TRENDS


Refusal to Donate

 All fifty states have passed some version of the Uniform Anatomical Gift Act, generally providing that individuals may make a gift of their organs and tissues.  Additionally, the Acts provide that family members may generally donate organs and tissues of a deceased individual if there is no indication the deceased individual did not want to be an organ donor.  The latest version of the Uniform Anatomical Gift Act provides that an individual can document a refusal to donate organs.  Even states that do not expressly address "refusal to donate" documents, provide that an individual's wishes NOT to be an organ donor are to be honored at the individual's death.

If an individual does not want to be an organ donor for any reason, it is recommended that they document their refusal to donate regardless of whether the individual's state specifically provides for such a document.  A documented refusal may assist others in making a donation-decision that is consistent with an individual's wishes.  If the Nondonor has specific questions about refusing to be an organ donor it is recommended that the Nondonor contact an attorney.

Users are referred to this program's separate document, "Organ Donation Form" for more information on making an organ donation.  Nondonors are encouraged to read the help topic,  Donations by Others for information on the important role that family members play in the organ donation process.

For more information, see:

 ALTERNATIVE REVOCATION METHODS

 DONATIONS BY OTHERS

 DONATIONS ON DRIVERS' LICENSES

 EXTRA STEPS AT REVOCATION

 HOSPITAL PROCEDURES

 MINORS

 ORGAN DONATIONS DURING LIFE

 RECENT TRENDS

 REVOKING PREVIOUS DONATIONS

 SEVERABILITY

 SIGNATURES

 WITNESSES


Revoking Previous Donations

 To avoid any confusion and to clarify an individual's wishes, it is recommended that old donor forms be revoked when a refusal to donate form is completed.  An optional paragraph in this program's document indicates the revocation of any previous donations.

Nondonors who are revoking a previous donation should read the topic,  Extra Steps at Revocation.

For more information, see:

 ALTERNATIVE REVOCATION METHODS

 DONATIONS ON DRIVERS' LICENSES

 EXTRA STEPS AT REVOCATION

 REFUSAL TO DONATE


Severability For Refusal to Donate Organs
Severability

 The severability paragraph provides some protection against the possibility that a refusal form might be declared invalid simply because a state law does not permit a specific provision that was included in the form.  If that occurred, the inclusion of the severability paragraph would provide protection against the possibility that the unusual provision would cause the entire form to be invalid.

For more information, see:

 REFUSAL TO DONATE


Signatures

 Generally individuals must be competent to execute a valid document.  Many states specifically state that an individual must be of "sound mind" to execute a valid organ donation document.  Generally, "competency" is the mental ability to understand the general effect of a transaction or document and every adult is presumed to be competent.

 Incompetency

If an individual has a court appointed guardian or conservator, or has been determined incompetent, that individual or their guardian should consult an attorney who is familiar with state laws regarding competency to obtain advice about completing a "Refusal to Donate Form." A document completed and signed by an individual who was not competent may not be valid.  In the event that a form is invalid, an individual's family or guardian would likely be asked to make any organ donation decisions.  A "Refusal to Donate Form" would likely be considered as evidence of an individual's wishes in such circumstances.

For more information, see:

 MINORS

 REFUSAL TO DONATE

 WITNESSES


Witnesses

 It is recommended that two witnesses sign this program's "Refusal to Donate Form" so that it is more likely to be valid in all states.  The majority of states still require two witnesses for a valid execution of a donation form. States that refer to a refusal to Donate Document require two witnesses when another individual signs on behalf of a nondonor. Generally, witnesses should be adults, mentally competent and present when the Nondonor signs the form.

For more information, see:

 SIGNATURES

 MINORS

 REFUSAL TO DONATE


Minors

 Most states do not specifically provide that a minor can document a refusal to donate.  However, minors are encouraged to complete a "Refusal to Donate Form" if they do not desire to be an organ donor.  Depending on the status and interpretation of the law in a particular state, it is possible that a minor's family could be asked to donate the minor's organs even if the minor had signed a refusal form. However, a completed form indicates the wishes of a minor and may assist a parent or legal guardian in making a decision at a later time.  If possible, minors should obtain the consent of a parent or guardian.

 Ages

While most state laws are silent on minors and the refusal to donate, state laws concerning organ donations provide some guidance on the relevant ages.  The majority of states provide that an individual 18 years of age or older can execute an organ donation document.  Nebraska requires an individual to be 19 years of age.  Maine, and Louisiana in certain circumstances, allow an individual 16 years of age or older to execute a donor document.  Although a few states may allow a minor 16 years old or older to execute a document, it is recommended that parental or guardian consent be obtained for minors in all states to increase the chance that the forms would be honored in all states.

 Parents Preferred

Some states prefer that parental consent be obtained even if a guardian has been appointed for a minor. Delaware specifically requires parental consent for a donation unless a parent is no longer living or no longer has contractual capacity.  This program's form provides for both parents' signatures although this is not required by any state.  If both parents are available and willing to consent to a "refusal to donate," both signatures on the form may facilitate the process at a later time.

 State Specifics

While most state-specific provisions deal with organ donations and not refusals to donate, it is possible a state would apply the same rules when a minor documents a refusal to donate.  South Dakota and Iowa only allow a minor 14 years old or older to execute a document with the consent of a parent or guardian.  However, minors under the age of 14 are encouraged to execute a document to indicate their wishes.  Delaware exempts married minors from the requirement of parental or guardian consent.  Ohio, Wyoming, and Nevada (for minor over the age of 12) requires that one of two witnesses be a parent or guardian.  For Nevada minors under the age of 12, a parent or guardian must sign on behalf of the minor with two additional witnesses and the actual donor need not sign.  Additionally, the parent or guardian must make any revocations or amendments on behalf of a Nevada minor under 12.  Indiana's provision allowing minor's to donate is only incorporated into the driver's license provisions.  Texas requires parental consent for a form to be valid if the minor actually dies before the age of 18.

For more information, see:

 SIGNATURES

 WITNESSES

 REFUSAL TO DONATE


Donations By Others For Refusal To Donate Organs Form
Donations By Others

 In general, state laws provide which family members or other individuals are authorized to make organ donation decisions concerning a deceased individual.  These individuals may be involved even if an individual completed a "Refusal to Donate Form".  For example if the form is not located when an individual dies, the family may be asked to make a donation decision.  It is recommended that Nondonors discuss their wishes with their families and carry any refusal form that they have completed in their wallets.

Many states also provide that the organs and tissues of a body in the custody of a medical examiner or coroner may be removed under certain circumstances.  Generally, removal is not allowed if there is an objection by the deceased individual's next-of-kin or it is known that the deceased individual did not want to be an organ donor.

For more information, see:

 REFUSAL TO DONATE


Hospital Procedures For Refusal to Donate Organs Form
Hospital Procedures

 There has been substantial activity aimed at increasing the availability of organs for transplant purposes since organ demand far exceeds supply.  Many states require that hospitals ask patients if they have completed a donor form or if they would like to do so when they are admitted to a hospital.  The hospital may request a copy of organ donation forms or a refusal form for an individual's medical record. Additionally, a federal law requires most hospitals to identify potential organ donors and inform their families about the possibility of organ donation near or at the time of death.

For more information, see:

 REFUSAL TO DONATE


Recent Trends For Refusal to Donate Organs Form
Recent Trends

 There has been some discussion in the medical, legal, and other fields about innovative approaches to increasing the supply of organs available for transplantation.  "Presumed Consent" is a system where it is presumed that all individuals would consent to the donation of their organs. Individuals must specifically state a desire not to be an organ donor to avoid having their organs, tissues, or parts removed at their death.  Some European countries have this system and such legislation has been introduced in the United States but has not passed.

For more information, see:

 REFUSAL TO DONATE


Organ Donations During Life

 This document only deals with the donation of organs after death.  Donations of organs or tissues before death, such as donating blood, bone marrow, or one kidney, is a completely different process.  Since an individual is alive for such a donation, the individual could express their refusal or consent to donate at that time.

For more information, see:

 REFUSAL TO DONATE


Alternative Revocation Methods For Refusal to Donate Organs Form
Alternative Revocation Methods

 In general, the Uniform Anatomical Gift Acts provide that an organ donation document may be revoked in any of the following ways:

1. 	A signed statement or document indicating revocation.

2. 	An oral statement made in the presence of two individuals.

3. 	Any communication to a physician during a terminal illness or injury.

4. 	Delivering a signed revocation to a designated donee.

If a previous donation is contained in a will, the donation may be revoked by amending the will.  The Uniform Acts also provide that any of the four options above are effective to revoke a donation made in a will.

For more information, see:

 EXTRA STEPS AT REVOCATION

 DONATIONS ON DRIVERS LICENSES

 REVOKING PREVIOUS DONATIONS

 REFUSAL TO DONATE


Extra Steps At Revocation For Refusal to Donate Organs Form
Extra Steps At Revocation

 It is important that a revocation of a donor form be communicated to anyone who had previously received a copy of the now-revoked form.  If a previous donation was delivered to a specified donee, many states require that a copy of the revocation or communication of the revocation also be sent to that donee. It is recommended that the following actions be considered in addition to indicating a revocation in this program's Form:

- 	If the Nondonor has a copy of the now-revoked donor form, it  is recommended that it be destroyed.

- 	If the Nondonor had previously sent copies of the now-revoked donor form to other parties it is strongly recommended that a copy of the revocation and "Refusal to Donate Form" also be sent to those parties.

- 	It is recommended that Nondonors communicate any revocations of prior donations and their current wishes concerning organ donation to their families. Family members are often involved in organ donation decisions so it is important that they are aware of the existence of revocations and a user's wishes.

For more information, see:

 ALTERNATIVE REVOCATION METHODS

 DONATIONS ON DRIVERS' LICENSES

 REVOKING PREVIOUS DONATIONS

 REFUSAL TO DONATE


Donations on Drivers' Licenses

 Many states provide that donor information can be or will be incorporated into drivers' licenses and identification cards.  State laws vary on whether the revocation, suspension, or expiration of a license that contains a donation effectively revokes a donation.  Additionally, states have various methods to revoke such donations, such as crossing through the form on the license, signing a revocation on the back of a license, destroying the card that accompanies a license, or sending written notice to the motor vehicle office.

If a Nondonor desires to revoke a donation made or reflected on a driver's license the Nondonor should follow any instructions provided at the time of the donation.  If there are any doubts about the status of a driver's license donation, it is recommended that the state officials responsible for the administration of drivers' licenses or donor forms be contacted concerning the revocation of a donation.  At the minimum, it is recommended that the Nondonor carry any revocation documents with the license or identification card so that the revocation will likely be discovered.

For more information, see:

 ALTERNATIVE REVOCATION METHODS

 EXTRA STEPS AT REVOCATION

 REVOKING PREVIOUS DONATIONS

 REFUSAL TO DONATE


 About Document Information

 Document Information provides, appropriately enough, information about the program's legal documents and offers guidance concerning the use of program features to solve legal questions.

Document Information can be accessed from any location in the program by pressing [CTRL+F1].  When in Document Information, you can move to other topics by following the on-screen prompts.

For more information, see:


 Exhibit

 An Exhibit is a document you can use to supplement other documents that refer to legal descriptions or other information which are lengthy and better handled in a separate item attached to a document, may exist as part of another document that is referred to in the text of a document, or refer to existing information that can be attached to the document.  Some of the documents in this program which contain a reference to an exhibit are the "General or Special Power of Attorney", "Child Care Authorization", "Employment Agreement", "Bill of Sale" as well as documents related to real estate transactions.

For more information, see:

 EMPLOYMENT DOCUMENTS

 FAMILY/PERSONAL

 FINANCIAL DOCUMENTS

 REAL ESTATE DOCUMENTS

 POWER OF ATTORNEY DOCUMENTS

 DOCUMENT INFORMATION TOPIC LIST


 Power of Attorney Documents

 A Power of Attorney is a document under which a person (a "Grantor") gives another person or entity (an "Attorney-in-Fact" or "Agent") powers to act on his or her behalf.  This program provides both general and special power of attorney documents, along with a temporary guardianship document, and a revocation of power of attorney document.

In addition, this program provides a specialized power of attorney document that is related to health care which is called a "Health Care Power of Attorney".

For more information, see:

 AGENT PROVISIONS

 EFFECTIVE DATE/DURABILITY

 GENERAL POWERS

 INTERPRETATION OF POA

 POWER OF ATTORNEY

 REVOCATION OF POWER OF ATTORNEY

 SIGNING THE POWER OF ATTORNEY

 SUCCESSOR AGENT

 CHILD CARE DOCUMENTS

 DOCUMENT INFORMATION TOPIC LIST


 Power of Attorney

 A General Power of Attorney is a document under which a person (a "Grantor") authorizes another person or entity (an "Attorney-in-Fact" or "Agent") to act on his or her behalf in a variety of situations.  In contrast, a Special Power of Attorney is a document under which a Grantor authorizes an Agent to act on his or her behalf in specific situations only.

A Grantor signs a Power of Attorney document so that the Agent will be able to handle the Grantor's affairs during a period of time when the Grantor is unavailable or unable to do so.  An Agent is not required to be a lawyer.

For more information, see:

 AGENT PROVISIONS

 EFFECTIVE DATE/DURABILITY

 GENERAL POWERS

 INTERPRETATION OF POA

 POWER OF ATTORNEY DOCUMENTS

 REVOCATION OF POWER OF ATTORNEY

 SIGNING THE POWER OF ATTORNEY

 SUCCESSOR AGENT

 CHILD CARE DOCUMENTS


 Successor Agent

 There is always the possibility that the Agent will not be able to serve or may be unwilling to serve.  For example, an elderly husband, as Grantor, may name his elderly wife as the Agent.  Subsequent to the signing, they both are diagnosed as having Alzheimer's disease.  Now, the wife is no longer mentally competent, and therefore, cannot serve as the Agent.  Further, the husband is also mentally incompetent, and therefore, he cannot sign a new power of attorney.  Designating a successor agent in the original power of attorney might have prevented this problem.

For more information, see:

 AGENT PROVISIONS

 GENERAL POWERS

 POWER OF ATTORNEY

 POWER OF ATTORNEY DOCUMENTS


 General Powers

 A general power of attorney is very broad and provides extensive powers.  A general statement is included which gives the Agent "full power and authority" to act on behalf of the Grantor.  The document then lists certain powers to make it clear that the Grantor intended to grant such broad powers.

Broad powers include powers to:

- Handle banking transactions;

- Enter safety deposit boxes;

- Handle transactions involving U.S. securities;

- Buy and sell property;

- Purchase life insurance;

- Settle claims;

- Enter into contracts;

- Exercise stock rights;

- Buy, manage, or sell real estate;

- File tax returns; and

- Handle matters related to government benefits.

In addition, optional powers include powers to:

- Maintain and operate business interests;

- Employ professional assistance;

- Make gifts;

- Make transfers to revocable ("living") trusts; and

- "Disclaim interests" (this power can be an important estate planning tool that helps avoid estate taxes).

If providing broad powers is not desirable, perhaps a Special Power of Attorney which can be limited in scope would be more appropriate.  The above powers are all offered as "options" in developing a Special Power of Attorney document.

For more information, see:

 AGENT PROVISIONS

 EFFECTIVE DATE/DURABILITY

 INTERPRETATION OF POA

 POWER OF ATTORNEY

 POWER OF ATTORNEY DOCUMENTS


 Interpretation of POA

 The intent of a General Power of Attorney is to permit the Agent to take any action on behalf of the Grantor; the listing of specific powers should not be interpreted as meaning that the Agent's powers are limited only to the listed powers.  On the other hand, a Special Power of Attorney should be interpreted as allowing an Agent full authority with respect only to the powers as listed in the document.

For more information, see:

 CHILD CARE DOCUMENTS

 GENERAL POWERS

 POWER OF ATTORNEY

 POWER OF ATTORNEY DOCUMENTS


 Agent Provisions

 Generally, an Agent is only held liable for intentional misconduct.  This protection is designed to encourage Agents to accept the responsibility of being an Agent.

Often Agents serve without compensation.  It is advisable for the Grantor to state his or her preference in the document to avoid questions at a later time when the Grantor is no longer able to state his or her intentions. For example, a family member may serve as Agent during the Grantor's lifetime, and then to the dismay of the rest of the family after the Grantor's death, the Agent makes a claim against the Grantor's estate for more than mere "love and affection".

Requiring the Agent to provide accountings helps ensure that the Agent is carrying out his or her duties in a responsible manner.

For more information, see:

 CHILD CARE DOCUMENTS

 GENERAL POWERS

 INTERPRETATION OF POA

 POWER OF ATTORNEY DOCUMENTS

 SIGNING THE POWER OF ATTORNEY

 SUCCESSOR AGENT


 Effective Date/Durability

 This program offers flexibility in allowing the Grantor to specify when the document becomes effective and when its effectiveness terminates.  In addition, both the General and Special Power of Attorney documents can be made "durable".  Under English law on which American law is based, power of attorney documents STOPPED being effective if the Grantor became mentally incompetent; this was intended to protect the Grantor from inappropriate actions that might be taken by the Agent without the Grantor's ability to respond.  However, most Grantors are willing to take this risk because the possibility of the Grantor becoming incompetent is a primary reason for desiring the power of attorney.  In fact, many Grantors do not want the power of attorney to become effective UNTIL they become mentally incompetent.  American law has responded to this desire by allowing Grantors to specify that the power of attorney (i) "shall not be affected by my disability or lack of mental competence", or (ii) shall become effective "upon written certification . . . that I am disabled or lack sufficient mental competence".  Thus, such power of attorney documents are said to be "durable", that is the power granted under the document survives the fact that the Grantor has become mentally incompetent.

For more information, see:

 INTERPRETATION OF POA

 POWER OF ATTORNEY

 POWER OF ATTORNEY DOCUMENTS


 Signing the Power of Attorney

 A power of attorney is not legally binding unless the Grantor is mentally competent at the time of the signing of the document.  If there is any question regarding the Grantor's mental competence, it may be advisable to obtain a physician's written opinion that the Grantor understands the document and the consequences of signing the document. It is also advisable to review such issues with an attorney.

Several states require that the power of attorney be signed in the presence of witnesses.  In all states, including the states that require witnesses, the signatures on the power of attorney should be notarized.

In some states, the name of the person who prepared the power of attorney document must be indicated in the document as a requirement for recording the document. Most power of attorney documents are not recorded, but it may be required if the Agent handles real estate transactions for the Grantor.  This program provides the option of including the name of the preparer.

For more information, see:

 ACKNOWLEDGEMENT

 AGENT PROVISIONS

 CHILD CARE DOCUMENTS

 POWER OF ATTORNEY DOCUMENTS


 Child Care Documents

 This program offers three documents that may be useful in providing authority to "caretakers" of your children, including baby-sitters, school officials, and other persons who you may wish to provide temporary custody.  In some cases, you may wish to use all three documents.  For other situations, it may be more appropriate to use only one or two.

 Child Care Authorization

The Child Care Authorization is used to grant some other person or institution (a "caretaker") temporary custody of your children.  For example, if you will be separated from your children for a few days, you may wish to grant certain powers (regarding your child's basic needs, including medical, nutritional, and educational needs) to a relative, friend or other person who will be taking care of your children.  Similarly, a "Child Care Authorization" may be needed to provide your child's teacher, school, or other organization with appropriate authority to take your child on a field trip or other outing.  You may name more than one caretaker (for example, a husband and wife).

 Letter to School

The Letter to School provides notice to school officials regarding the identity of the caretaker(s) and the scope of the authority granted to the caretaker(s).  It is important to understand that the Letter to School does not provide the grant of authority to the caretaker(s); it simply provides notice to the school officials.  The Child Care Authorization provides the authority to the caretaker(s).

 Child Care Instructions

The Child Care Instructions document provides important phone numbers, medical information, and special instructions to babysitters, day care providers, and other "caretakers" who will have responsibility for child care on a short-term basis.  This document does not grant specific powers to the caretaker.  This can be accomplished by using the "Child Care Authorization".

For more information, see:

 CARETAKER POWERS

 FAMILY/PERSONAL

 POWER OF ATTORNEY DOCUMENTS


Caretaker Powers

 It is important to carefully consider the powers that will be given to the caretaker.  For example, you may wish to make sure that the caretaker has authority to provide for basic physical needs, including medical needs.  Depending on the level of trust in the caretaker and the length of time involved it may be desirable to grant other powers as well. For example, it may be desirable to give the caretaker the authority to grant permission for various activities that the child attends (e.g., parties, musical lessons, sports activities).

For more information, see:

 CHILD CARE DOCUMENTS

 POWER OF ATTORNEY DOCUMENTS


 Revocation of Power of Attorney

 When the conditions that necessitated the granting of a Power of Attorney change, it may become necessary to revoke the powers granted.  The Revocation of Power of Attorney is a document under which a person (a "Grantor") revokes a Power of Attorney, whether general or special, that previously authorized another person (an "Agent" or "Attorney-in-Fact") to act on the Grantor's behalf.  A copy of this document MUST be presented to the Agent as evidence of the Grantor's intent to revoke the Power of Attorney.

For more information, see:

 CHILD CARE DOCUMENTS

 INTERPRETATION OF POA

 POWER OF ATTORNEY DOCUMENTS


 Real Estate Documents

 This program provides various documents which are useful in the purchase, sale or leasing of real property.  For example, this program contains several worksheets which provide guidance in evaluating and making an offer to purchase real property.  Other documents include leases for residential and/or commercial property.  The Homeowner's Association Proxy may be useful to members of an owners association, while the Rental Application and the Renter's Inspection Worksheet may be helpful to tenants and landlords.

For more information, see:

 HOME EVALUATION WORKSHEET

 HOME PURCHASE WORKSHEET

 HOME SALE WORKSHEET

 HOMEOWNERS' ASSOCIATION PROXY

 REAL ESTATE LEASE

 RENTAL APPLICATION

 RENTER'S INSPECTION WORKSHEET

 OTHER REAL ESTATE DOCUMENTS

 DOCUMENT INFORMATION TOPIC LIST


Application Process
 Rental Application Process

 Landlords want to be sure to rent to good tenants who will take good care of the premises and make timely rental payments. Following an application procedure requires time, patience and persistence.

  Screening Applicants

Pre-qualify applicants.  For example, ask about the beginning date of occupancy, advise applicants as to the amount of deposit required, the number of occupants, ask whether they have pets, and whether they have a waterbed. Don't reveal your criteria to the prospective tenant. Rather, ask open-ended questions such as, "Do you have any pets?" If the tenant does not satisfy your initial criteria, there is no need to even complete an application or take the time to show the premises.

Have all prospective tenants who satisfy the initial criteria complete an application form.  The landlord is not obligated to rent to the first applicant.  (Please refer to the  "Discrimination" topic for an explanation of a related matter.)  Indicate that you will be taking applications over the next few days, verifying employment, credit and references, and will let the applicant know of your decision.  Write the reasons for rejection on the back of the Application form and keep it for at least three (3) years as evidence of your fair rental practices.

Some of the information on the application may appear irrelevant, but is good information if you need to collect rent or delinquent rent.  Review the Application as if you were trying to collect a judgment for delinquent rent.  If the Tenant does not have stable employment or any assets to attach, how can they pay rent?

  Deposit

By requiring a deposit with the application you can determine whether the tenant is serious.  The amount can be fairly small if you are trying to eliminate curious applicants.  However, a deposit with an application may be more inconvenience than the landlord desires at this early stage.  If you reject an applicant, they may have mistakenly assumed that you were holding the unit for them. This type of misunderstanding may be avoided by not taking a deposit with the application.

  Identification

After completing the application, ask the applicant for some form of identification.  Driver's license, credit card, passport, or military ID.  Otherwise you have no way of knowing if the person whose name is on the application and the references are actually those of the prospective tenant! Also verify the identification with information given on the Application - social security number, driver's license number, current address.  Ask for an explanation of anything that does not match.  Make a note of the explanation, and then decide for yourself if you believe the explanation.

  Applicant Does Not Meet Criteria

If an Applicant does not meet your criteria, be sure to document the basis of your decision.  The best approach with the Applicant is to be honest, direct, and polite.  And don't budge from your predetermined criteria despite an appeal from the Applicant. Outbursts from Applicants may be indicative of a reluctance to follow rules or guidelines. Enduring a small amount of unpleasantness at the time of rejection may save you from having to cope with an unsuitable tenant in the future.

 Reviewing Rental Rules and Policies

Before you accept an Applicant as a tenant, review your rules and policies with them to avoid any misunderstandings. For example, deposits, rent payment, late payment fees, guests, parties, quiet hours, parking, utilities, garbage, pets, waterbeds, hanging things on walls, changing locks, painting, maintenance, emergencies, widow breakage, drain stoppages, lockouts, insurance, and how much notice you require if they plan to vacate the premises.

Let your potential tenants have an accurate understanding of what they can expect from you as their landlord, from other tenants (if any) and what you expect from them.  After you explain the rules and expectations, ask the tenants for their agreement.  Also, complete the "Rental Inspection Checklist" to confirm the condition of the premises at the time they are rented.

  Personal Checks For Deposit or First Month's Rent

Once the lease has been signed, do not accept a personal check for deposits or the first month's rent.  Only accept cash, money orders or cashier's checks. Do not provide a key or allow a tenant to move in (even a "few things") until you have been paid the full amount requested. Provide a receipt for whatever money is paid.  Receipt books are available at office supply stores.

For more information, see:

 CO-SIGNER

 CREDIT REFERENCES

 DISCRIMINATION

 EMPLOYMENT VERIFICATION

 REFERENCE VERIFICATION


 Reference Verification

 If landlords do not check references, there is no way of knowing if the information given on the Application is true. Check with the prior landlord and verify the employment at a minimum.

Be careful; unscrupulous Applicants can have a friend impersonate the current landlord.  When verifying references over the phone, don't indicate that the Applicant has given the reference as a landlord.  Rather tell that person they have been given as a reference, and ask them how they are acquainted with the Applicant.  The friend might think this is a personal reference and give away their ruse.  Indicate that your rental unit is substantially higher (or lower) than the prior rental amount given on the application.  The landlord should be able to tell you the correct rental amount.

  Questions to Ask Current Landlord

Typical questions to ask the current landlord include:

1. Current rent payment amount.

2. How long has the Applicant been a tenant?

3. How many times has the Applicant been late with the rent?

4. Have you had any complaints from neighbors regarding the Applicant?

5. Is the Applicant presentable?  Cooperative?

6. Why is the Applicant moving?

7. Would you rent to this person again in the future?

  Check With Prior Landlord

What if the current landlord is anxious to have the tenants move, and is willing to say anything to get rid of them? Compare the reasons given by the Applicant with the reasons given by the Landlord.  If you have any suspicions, check with the prior landlord -- that person has no interest in whether the tenants stay or move.

  Verify Factual Information

Also, landlords may be reluctant to give out any information.  Tell them you are not asking for a good or bad recommendation, just basic information.  Verify as much factual information with a reluctant landlord as you can. For example, the amount of rent and how long the Applicant has been a tenant.

For more information, see:

 APPLICATION PROCESS

 CO-SIGNER

 CREDIT REFERENCES

 DISCRIMINATION

 EMPLOYMENT VERIFICATION


 Employment Verification

 Verify the fact of employment, length of employment and income. Smaller employers are more likely to verify information over the telephone because the employer personally knows the Applicant and wants to assist the employee in obtaining housing.  If the employer is reluctant, you can ask questions that will require a simple "yes" or "no" response.  For example, "Jim Johnson would like to rent a house from me.  On his application he said he worked for your firm for three years.  Is that correct?" "Jim indicated that he makes approximately $35,000 a year. Is that correct?"  You might also try calling the Applicant's immediate supervisor.

If the employer is reluctant to confirm any information over the telephone, you can use a form letter to request employment verification.  It is a good idea to have a serious Applicant complete and sign verification forms at the time the application is taken.  The possibility of receiving a response is increased if you enclose a self-addressed, stamped envelope for the employer to return the verification.  This program offers verification form letters.

For more information, see:

 APPLICATION PROCESS

 CO-SIGNER

 CREDIT REFERENCES

 DISCRIMINATION

 REFERENCE VERIFICATION


 Credit References

 If you feel comfortable with the current landlord's recommendation, and the Applicant's employment situation, you may not want to pursue credit references.  But a little time and effort spent before ever renting a unit may save frustration in collecting rent or even eviction proceedings. You may establish criteria and check credit references in certain instances.  (For example, if the portion of the Applicant's income that will be paid towards rent exceeds a certain percentage (e.g. more than a third), or if there is a substantial increase in the new rent over the prior rent.)

  Financial Institutions

Most financial institutions will not provide account information over the telephone.  Some merchants with customer charge accounts may release credit references.  The best approach is to have the Applicant complete Credit Verification forms at the time the rental application is taken.  The letter must be signed by the Applicant.  Be sure to include a self-addressed, stamped envelope when sending the form to the appropriate financial institution.  This program offers a credit verification form letter.

  Credit Reporting Agency

Some landlord groups belong to a credit reporting agency which provides its members with economical credit checking privileges.  Dealing directly with a credit reporting agency can be rather expensive.

When a credit report is a factor in turning down an application, the Federal Fair Credit Reporting Act requires that the reasons and the name and address of the credit reporting agency must be given to the applicant.

  Investigative Report

If an investigative report is made of the applicant's personal life, the applicant has the right to be informed, upon request, of the scope and nature of the report.  An investigative consumer report is a special credit report with more detail than a routine report.  It includes information about the applicant's character, general reputation, and personal characteristics.  It may also include information from interviews with neighbors, friends, or associates, and information concerning the applicant's credit standing, and driving habits and record.

For more information, see:

 APPLICATION PROCESS

 CO-SIGNER

 DISCRIMINATION

 EMPLOYMENT VERIFICATION

 REFERENCE VERIFICATION


 Co-Signer

 You may wish to require a co-signer if a potential tenant is just beginning a job, and has not established a credit history, and you want to give the person a chance (for example, an employed person who has lived with relatives, and now wants a place of his/her own).  To protect yourself in such a situation, a financially responsible person should co-sign the lease in case your initial instincts about the tenant are incorrect.

The same information should be requested from the co-signer as the Applicant.  Be as careful checking the references of the co-signer as an Applicant.  You may have to rely on the co-signer's financial ability to pay the rent or any delinquencies.  Once you have assured yourself of the co-signer's employment and credit references, be sure to have the co-signer actually sign the lease or a co-signer agreement.

For more information, see:

 APPLICATION PROCESS

 CREDIT REFERENCES

 DISCRIMINATION

 EMPLOYMENT VERIFICATION

 REFERENCE VERIFICATION


 Discrimination

 You are not required to rent to the first person who expresses an interest in the rental unit.  The purpose for refusing to rent, though, must be based on a permissible purpose.  And the purpose of the rental application process is to determine, through permissible factors, to the best of your ability, whether a tenant is an acceptable renter.

Do not discriminate against an applicant on the basis of an illegal purpose: race, color, religion, sex, national origin, age or disability.  Such discrimination AS THE SOLE BASIS OF REFUSAL TO RENT is illegal throughout the United States.  You many call the U.S. Department of Housing and Urban Development (HUD) at 1-800-424-8590 to ask questions about discrimination.

  Additional Classes of Protection From Discrimination

State laws or local ordinances may provide additional classes which are protected from discrimination, such as marital status, sexual orientation, source of income, family responsibilities, or student status.  Call your state's consumer protection office or the local department of housing to determine if any additional classes are protected in your locale.

  Establish Your Standards

You may discriminate on a tenant's ability to pay, pets, waterbeds, number of occupants, honesty, permanence, or other criteria required of all tenants.  Establish your standards for a particular rental unit.  For example:

Gross income:   Four times rental amount

Employment:   At least six months in current position

Credit:   No negative reports

Rent:   No late payments to prior landlord

Pets:   None

Smoking:   No

Waterbed:   One queen size

Vehicles:   Two

References:   Two good personal references

Occupants:   Three

Permanency:   At least one year in last two rental units

Appearance:   Clean; average apparel

If marital status is a protected class in your locale, consider the following points.  If two adults are prospective tenants, each should qualify for your rental guidelines, because either one could end up being your sole tenant.  Because you cannot discriminate on the basis of marital status, you cannot separate the income of an unmarried couple, but combine the income of a married couple.  Or you can take your risks and aggregate the income of both applicants, whether married or not married.  The key is that your standards are the same whether the couple is married or not.

For more information, see:

 APPLICATION PROCESS

 CO-SIGNER

 CREDIT REFERENCES

 EMPLOYMENT VERIFICATION

 REFERENCE VERIFICATION


 Home Purchase Worksheet

 The Home Purchase Worksheet is a worksheet designed to assist a buyer with the purchase of a personal residence. The worksheet leads the buyer through a section that allows the buyer to state his or her preferences, including price, location, style, and size of the residence.

For buyers who expect to finance a portion of the purchase price with a lender, the worksheet also analyzes the buyer's cash flow and net worth.  The program then uses these factors to calculate estimates of the optimal purchase price and a suggested mortgage payment.  In addition, the buyer can enter the loan terms (e.g., interest rate, loan amount, number of years, "points") proposed by various lenders and the program compares the loan terms to determine which proposal offers the most economical terms.

The worksheet also offers a closing costs schedule to track the various costs that will be included as part of the purchase of the residence, including loan fees, credit reports, commissions, title fees, property taxes, insurance, and recording costs.  A progress chart allows the buyer to monitor the progress of the real estate agent and the lender.

For more information, see:

 BORROWING ABILITY

 BUYER'S CASH FLOW

 BUYER'S NET WORTH

 BUYER'S PREFERENCES

 CLOSING COSTS

 CREDIT HISTORY

 LOAN COMPARISON

 LOAN TERMS

 PROGRESS CHART

 REAL ESTATE DOCUMENTS


 Buyer's Preferences

 Perhaps the most important factor in determining the buyer's choice of a residence is the purchase price.  This factor affects the amount of cash that the buyer must pay at the closing, as well as the monthly payment if the buyer will be obtaining financing from a lender.  Other sections of the Home Purchase Worksheet provide additional guidance regarding the purchase price and the amount of financing that may be available to the buyer.

Other important preferences include location, lot size, residence size, architectural style, and specific features of the residence.  An experienced real estate agent may be able to explain whether the stated preferences are feasible in light of the preferred price range.  The agent may also be able to work with the buyer in identifying which of the preferences are the most expensive, and therefore, could be modified to make the preferred purchase price more feasible.

For more information, see:

 BORROWING ABILITY

 BUYER'S CASH FLOW

 BUYER'S NET WORTH

 CLOSING COSTS

 CREDIT HISTORY

 HOME PURCHASE WORKSHEET

 LOAN COMPARISON

 LOAN TERMS

 PROGRESS CHART


 Buyer's Cash Flow

 The Buyer's Cash Flow section helps the buyer who expects to obtain third party financing to identify how much cash the buyer will have available to make monthly mortgage payments. More monthly income available to make mortgage payments means that a higher purchase price is more affordable.  Of course, the size of the mortgage payment is also dependent on the interest rate and the period of time over which the loan funds are repaid.   A lower interest rate on a loan repaid over a longer period of time results in a lower mortgage payment, assuming that the same size of loan is obtained.

  Monthly Income

Under the "Monthly Income" section, all of the buyer's income should be listed.  This section requires that all items of income be stated as a monthly amount.  Therefore, items of income that are received on some other basis will need to be adjusted to reflect a monthly amount.  For example, a buyer who is self-employed will need to first estimate his or her annual income and then divide the annual income by 12 to obtain a monthly amount.

  Loan Payments

All loan payments should be included in the loan payments section, including the loan payments, if any, related to a current residence.  However, the loan payments on a mortgage related to a current residence are listed as "memo info only", and such payments are not included in the "Total Loan Payments" amount.  The reason is because it is expected that a loan on a current residence will be paid in full if a new residence is purchased.  Similarly, in the "Monthly Expenses" section rent payments, property taxes, and property insurance are not included in the "Total Monthly Expenses" on the assumption that such items will be included as part of a monthly mortgage payment on a new residence. Although a mortgage payment is technically the repayment of only the loan, many lenders also collect an additional amount each month as an "escrow payment" that is then used to pay the property taxes and insurance premiums as such items become due.

The amount included as the monthly payment on a credit card account should only include the interest, plus the amount by which the balance from the prior month will actually be reduced.  In other words, the monthly payment amount should not include the portion of the monthly payment, if any, that simply represents payment of the current month charges. Payment of the current month charges will be included in the various expense categories.

Example.  Mary has a credit card with a current balance of $1,000.  Her monthly payment for the purposes of this program should only include:

-    the average amount that she expects to pay as monthly interest, perhaps $12, plus,

-    the average amount that she intends to pay each month to reduce her outstanding balance below $1,000.

If she intends to reduce her current balance to $880 over the next 12 months, her monthly payment for the purposes of this program would include $12 per month in interest, plus $10 per month in principal reduction for a total of $22 per month.  She would not include amounts that she might make during the year to pay new charges on the account.

  Monthly Expenses

All of the buyer's monthly expenses (including new charges to credit card accounts) should be included in the "Monthly Expenses" section.  This may require some estimation and guess work, depending on how well the buyer maintains records.  Even if the buyer does not maintain such records, it may be useful to complete this section as a budgeting process.  If the "Net Monthly Cash Flow" at the end of the section is not high enough to support an adequate monthly mortgage payment, perhaps additional cash flow can be generated by adopting a more stringent budget.

For more information, see:

 BORROWING ABILITY

 BUYER'S NET WORTH

 BUYER'S PREFERENCES

 CLOSING COSTS

 CREDIT HISTORY

 HOME PURCHASE WORKSHEET

 LOAN COMPARISON

 LOAN TERMS

 PROGRESS CHART


 Borrowing Ability

 Lenders and real estate agents use several tests to provide estimates of, (i) the maximum purchase price that the buyer should pay for the residence, (ii) the maximum mortgage payment that the buyer should consider, (iii) the total amount of loan payments that the Buyer's income will support, and (iv) the amount of the Buyer's income that should be reserved for monthly expenses, including income and FICA (social security) taxes.

These tests are based on averages and the experience of lenders, and should only be used as estimates.  A lender will also take into consideration other factors, including expectations regarding future increases in the buyer's income, the buyer's credit history, evidence that the buyer spends less than the "average" 64 percent of gross monthly income on monthly expenses, and the buyer's net worth.

For more information, see:

 BUYER'S CASH FLOW

 BUYER'S NET WORTH

 HOME PURCHASE WORKSHEET

 LOAN COMPARISON

 LOAN TERMS

 PROGRESS CHART


 Buyer's Net Worth

 While the buyer's cash flow is a very important factor to a lender (along with the buyer's credit history and the value of the residence) in determining the amount of the loan, the buyer's net worth is important also.  It can be expected that the lender's loan application will require the buyer to disclose the buyer's assets, liabilities, and net worth.  A significant amount of net worth may help overcome a weaker level of cash flow.  The net worth section in this program is intended to provide a summary for the buyer's use in determining the amount of the buyer's net worth.  It does not attempt to provide the detail that the lender will require; the level of detail varies depending on the lender and the forms that the lender will require.

For more information, see:

 BORROWING ABILITY

 BUYER'S CASH FLOW

 BUYER'S PREFERENCES

 CREDIT HISTORY

 HOME PURCHASE WORKSHEET


 Credit History

 A lender will generally request a credit report regarding the buyer's credit history.  A credit report will show the buyer's payment history with respect to credit cards, car loans, other loans, and other types of credit.  It may also show judgments that have been obtained against the buyer, as well as any bankruptcy proceedings in which the buyer has been the debtor.  If a buyer's history includes unfavorable items, it may be helpful for the buyer to explain the circumstances.

For more information, see:

 BORROWING ABILITY

 BUYER'S CASH FLOW

 BUYER'S NET WORTH

 BUYER'S PREFERENCES

 HOME PURCHASE WORKSHEET

 LOAN COMPARISON

 LOAN TERMS


 Loan Terms

 The "Loan Terms" section provides a convenient format to list the relevant information regarding actual or expected loan terms that may be offered by the lender.  This Loan Terms section provides the information for the "Loan Comparison" section which compares the terms of different offers.

A lender may be a bank, credit union, savings and loan association, or other lending institution.  In addition, the lender may be the seller.  In some transactions, sometimes known as "contract" sales, the seller provides the financing for the buyer by requiring a down payment and allowing the buyer to pay off the remaining amount over a period of time in a manner similar to making mortgage payments to a third party lender.  This program can be used to compare the "contract" terms offered by a seller to the mortgage terms offered by a lender.

  Important Terms

The important terms are usually the loan amount, the interest rate, and the number of years over which the loan will be repaid.  These factors determine the amount of the mortgage payment.  This program assumes that the lender will also require the buyer to pay an additional amount with the monthly payment.  This additional amount will be deposited into an "escrow account".  The funds in the escrow account will be used to pay the buyer's property insurance and property taxes as these items become due.

Other important terms include "points" and "closing costs". Points are additional interest.  Each "point" is equal to one percent of the loan amount.  In contrast to regular interest which is paid as part of the regular monthly payment, points must be paid when the loan is made (at the closing).  Closing costs are the lender's charges for processing the loan.  Closing costs are often stated as a percentage of the loan amount, but closing costs should not be confused with points.  Points are interest which can be deducted for income tax purposes.  Closing costs usually cannot be deducted.

Example.  A lender may offer a $120,000 loan, with an annual interest rate of 8.0%, and a requirement that the loan be repaid in monthly payments over 25 years.  In addition, the lender may charge 2 "points" and a 2 percent fee for closing costs.  In this example, both the points and the closing costs will be equal to $2,400 (2% x $120,000). However, only the $2,400 paid as points will be deductible for income tax purposes.  The additional $2,400 paid for closing costs will not be deductible.

For more information, see:

 BORROWING ABILITY

 CLOSING COSTS

 HOME PURCHASE WORKSHEET

 LOAN COMPARISON

 PROGRESS CHART


 Loan Comparison

 A buyer who is obtaining financing may be required to choose loan terms from several alternatives.  This "Loan Comparison" section allows the buyer to compare various alternatives.

Example.  A lender may offer a $120,000 loan, with an annual interest rate of 8.0%, and a requirement that the loan be repaid in monthly payments over 25 years.  In addition, the lender may charge 1 "point".  As an alternative, the same lender (or a different lender) may be offering the same terms, except that the second alternative includes an annual interest rate of 7.5% (instead of 8.0%), but requires 2 points (instead of 1).  Which alternative is better?  One alternative offers a higher interest rate, but fewer points.  The other alternative offers a lower interest rate, but more points.

The buyer can compare these two alternatives by entering the loan terms in the "Loan Terms" section, and then completing the "Loan Comparison" section.

It is important to note that the assumption regarding the number of "Months Until Residence Sold" can greatly influence the comparison.  Generally, the longer that the residence and mortgage are held, the more favorably "a payment of more points to obtain a lower interest rate" will compare with "paying less points and accepting a higher interest rate".  In other words, if the residence will be sold and the mortgage paid off in just a few years, it may be more beneficial to pay a higher interest rate and fewer points.  If the residence and mortgage will be held for a longer period of time, it may be advantageous to "buy down" the interest rate by paying more points.  Adjusting the number of "Months Until Residence Sold" allows the buyer to determine at what point the two alternatives are approximately equal.

For more information, see:

 BORROWING ABILITY

 BUYER'S CASH FLOW

 BUYER'S NET WORTH

 BUYER'S PREFERENCES

 CLOSING COSTS

 CREDIT HISTORY

 HOME PURCHASE WORKSHEET

 LOAN TERMS

 PROGRESS CHART


 Closing Costs

 Sometimes the term "closing costs" is used to refer to all of the costs that will be paid as part of the closing, the time at which ownership of the residence changes from the seller to the buyer.  In this section, the term "closing costs" excludes points paid to a lender as additional interest.

The "Closing Costs Worksheet" lists the typical closing costs that are part of a real estate closing.  If the buyer will pay for the residence without obtaining financing from a lender, the amount of closing costs, and the number of closing cost items will be less.  The circumstances of each situation will dictate which items apply.  While some costs are usually paid by the buyer and other costs by the seller, by agreement, the parties can allocate the closing costs in whatever manner they choose.

The allocation of property taxes between the buyer and seller can be very confusing.  Generally, the parties try to allocate the taxes so that the seller is responsible for the taxes attributable to the property to the date of the closing, and the buyer is responsible for the taxes after that date.  However, required dates for payment of the taxes to the appropriate governmental body will probably not coincide with the closing date.  Further, in some jurisdictions, the dates for the payment of taxes do not coincide with the periods for which the taxes are attributable.  For example, a tax payment due in September may be attributable to some earlier period of time.  Because of the differences that can occur from one locality to another, it is advisable to review the customary practice for allocating taxes with a knowledgeable real estate agent or lender.

For more information, see:

 HOME PURCHASE WORKSHEET

 HOME SALE WORKSHEET

 LOAN COMPARISON

 LOAN TERMS

 PROGRESS CHART

 REAL ESTATE AGENTS


 Progress Chart

 A progress chart allows the buyer and seller to monitor the progress of the real estate agent and the buyer's lender (if any).  After the buyer has located a suitable residence, the usual first step is to make an offer to buy to the owner of the residence (the seller).  There may be one or more counter offers until either the parties stop negotiating or both agree to the terms of the offer or one of the counter offers.

After an offer (or counter offer) has been signed by both parties, it is customary for the buyer to pay "earnest money" which is deposited with a real estate agent or other third party agreeable to the buyer and seller.  There is always a lapse of time from the date that the offer is signed by both parties until the closing date.  The purpose of earnest money is to show the seller that the buyer is "earnest" about closing the transaction.  The amount of the earnest money varies with local practice, but may be 3 percent to 10 percent of the purchase price.  If the buyer refuses to complete the transaction, the buyer may be obligated to forfeit the earnest money to the seller.  This can be viewed as compensating the seller for the fact that the residence was "off the market" and unavailable for sale from the date of the offer until the date that the buyer refused to complete the transaction.

It is typical for the buyer's offer to be "contingent" on one or more factors.  A common contingency is the buyer's financing -- the buyer is willing to complete the transaction if the buyer is able to obtain a lender's commitment to provide financing.  Other contingencies may include whether the buyer is able to sell his or her current residence (or break a lease) by a specific date.  The buyer may make the offer contingent upon other factors including satisfactory professional inspections for pests or radon, or inspections of heating and cooling systems.  If the contingencies cannot be met, generally, the buyer will be able to void the offer and obtain a refund of the earnest money.

For more information, see:

 BORROWING ABILITY

 BUYER'S CASH FLOW

 BUYER'S NET WORTH

 BUYER'S PREFERENCES

 CLOSING COSTS

 CREDIT HISTORY

 HOME PREPARATION

 HOME PURCHASE WORKSHEET

 HOME SALE WORKSHEET

 LOAN COMPARISON

 LOAN TERMS

 REAL ESTATE AGENTS


 Home Evaluation Worksheet

 The Home Evaluation Worksheet provides a convenient format for maintaining information regarding the various properties that a buyer may inspect as part of the search for a residence.  The buyer can gather information regarding location, style, size, and other features of the various residences.  These features can then be compared.

This worksheet also provides an important checklist regarding inspections that should be completed before closing on the purchase of the residence.  These inspections include inspections of appliances, smoke detectors, security systems, and heating and cooling systems, as well as inspections for radon gas, asbestos, and termites or other pests.

For more information, see:

 DETAILED INSPECTION

 GENERAL INSPECTION

 LOCATION ANALYSIS

 REAL ESTATE DOCUMENTS


 General Inspection

 The "General Inspection" section of the Home Evaluation Worksheet provides a format for listing the general characteristics of a specific residence.  Most of the information to be listed in this section can be gathered on a routine "walk-through" inspection of the residence.  There are several exceptions.  Information regarding price, assessed value, the age of the residence, lot size, residence size, and property taxes will need to be obtained from the real estate agent, owner, or a local property tax official.  Information regarding utilities costs should be obtained from the real estate agent or the owner.

For more information, see:

 DETAILED INSPECTION

 HOME EVALUATION WORKSHEET

 LOCATION ANALYSIS


 Location Analysis

 The characteristics of the neighborhood and the proximity of the residence to a job location, school, shopping areas, and medical services may be very important in selecting a suitable residence.  The "Location Analysis" section of the Home Evaluation Worksheet provides a format for listing the important characteristics of the neighborhood and the distance of the residence to other locations that are important to the buyer.

For more information, see:

 DETAILED INSPECTION

 GENERAL INSPECTION

 HOME EVALUATION WORKSHEET


 Detailed Inspection

 The "Detailed Inspection" section of the Home Evaluation Worksheet provides a format for listing details regarding specific components of a specific residence.  Appliances and draperies may or may not be included in the purchase price of the residence, depending on the wishes of the seller.  It is important to clarify what fixtures, appliances, and other items of personal property will be included in the purchase.

While some of the information to be listed in this section can be gathered through casual observation on a routine "walk-through" inspection of the residence, it may be helpful to request the services of a professional for some items.  For example, a professional may be required to conduct an adequate inspection of the furnace or other structural components.  This section assumes that the buyer will inspect both the interior and exterior of the residence.  Therefore, some items (e.g., foundation and doors) are repeated in several sections of the listing.

 Covenants and Restrictions

This section also includes a "Land Use Restrictions" listing.  Covenants and restrictions can have a significant impact on the use and enjoyment of the residence.  Uniform covenants and restrictions are often adopted by developers for an entire subdivision (neighborhood) or condominium. These rules may

- limit business activities that can be conducted in the residence;

- affect parking, the appearance of the residence, and the requirements for storage and utility structures;

- provide for an owners association that governs certain common activities (e.g., maintenance of common grounds, private streets, or a water system);

- require payment of association fees and related common costs; and

- require certain procedures in connection with the sale of the residence.

These rules are usually included in the local real estate records and should be disclosed as part of the title examination process that will be conducted before the closing.  The real estate agent or the owner should be able to provide a copy.

 Zoning

Zoning regulations are local governmental regulations that affect what activities and uses can be conducted in certain "zones".  For example, the commercial area of a city may be zoned "heavy industrial" or "light commercial".  In a residential area it may be important to know whether the zoning designation allows rental properties, shopping centers, service stations, or convenience stores to be located in close proximity to residences.  In particular, it can be important if there are vacant or undeveloped properties located in close proximity to the residence that is being inspected.  The vacant lot next to the residence may be tomorrow's convenience store.  Zoning regulations should be available from a local government official or the real estate agent.

 Encroachments

The term "encroachments" refers to buildings, fences, shrubbery, or other items that are located on boundary lines.  Encroachments can adversely affect relationships with neighbors, cause problems with the title to the property, and create difficult hurdles in obtaining financing for the purchase of a residence.  While a casual inspection may raise some questions about the possibility of encroachments, a survey may be required to make an actual determination as to whether an encroachment exists.  Lenders often require a survey as part of the loan application process to make sure that there are no encroachment problems.

 Easements

The term "easements" refers to the legal right of a third party to use a portion of the property for a specific and limited purpose.  For example, there may be specific areas of the property where utility lines must be located. Generally, the owner will not be permitted to construct a residence or other building where the easement is located. Further, the third party holding the easement rights (e.g., the utility company) will have the right to enter the area of the easement to maintain the utilities or to conduct other activities specifically related to the easement.  The existence of easements should be obtained from the title examination process or from the real estate agent.

For more information, see:

 GENERAL INSPECTION

 HOME EVALUATION WORKSHEET

 LOCATION ANALYSIS


 Home Sale Worksheet

 The Home Sale Worksheet is a worksheet designed to assist a seller with the sale of a personal residence.  The worksheet includes a section that allows the seller to compare information regarding real estate agents.  It also includes a checklist to use in preparing the home for sale.

The worksheet also offers a closing costs schedule to track the various costs of the buyer and seller that will be included as part of the sale of the residence, including commissions, title fees, property taxes, insurance, and recording costs.  A progress chart allows the seller to monitor the progress of the real estate agent and the buyer's loan application process.

This worksheet is not intended as a substitute for a real estate agent or attorney.  However, it provides important information and assistance in choosing an agent and monitoring the progress of the sale.

For more information, see:

 CLOSING COSTS

 HOME PREPARATION

 PROGRESS CHART

 REAL ESTATE AGENTS

 REAL ESTATE DOCUMENTS


 Real Estate Agents

 This section allows the seller to gather information regarding several real estate agents and their firms.  It is important to understand how the agent's commission will be calculated.  Usually the commission is a fixed percentage of the actual sales price (which may be different than the advertised or listed price).  If the seller retains an agent to sell the residence, the agent will request that the seller sign an agreement (sometimes referred to as a "listing agreement") that sets forth the seller's and agent's responsibilities.  The seller should make sure that he or she clearly understands how long the listing agreement will be in effect and whether the seller can sell the residence privately to a friend or family member without becoming obligated to pay the real estate commission.  An attorney should be consulted if the seller has any questions.

It is also important to understand what level of effort the agent will provide in actively marketing the residence.  If the agent is a member of a "multiple listing" service, the seller should expect that information regarding the seller's residence will be published in a listing of all of the available residences in the area.  This listing is made available to other real estate agents and potential buyers. The agent's plans to advertise locally and conduct open houses can be very important in attracting potential buyers.

An agent's review of the potential buyer's financial condition and credit history can be very important.  If a seller accepts a buyer's offer to purchase the residence, it will often take 30 to 60 days to "close" the transaction. During that period of time, the title to the residence will be reviewed, and in many cases, the buyer will be applying for a loan.  If the buyer is unable to obtain financing, the transaction may not close, and the seller will be faced with finding another buyer.  In the meantime, valuable time has been lost which might have been avoided if the real estate agent had conducted some investigation into the buyer's financial condition in an effort to screen out a buyer with obvious financial problems.

For more information, see:

 CLOSING COSTS

 HOME PREPARATION

 HOME SALE WORKSHEET

 PROGRESS CHART


 Home Preparation

 The condition and appearance of the residence can have a dramatic effect on the sale price of the residence. Obviously, a residence that is clean and free from unpleasant odors makes a better impression on a potential buyer.  It is reasonable to assume that better impressions lead to better offers.  In addition, new carpeting, a fresh coat of paint, and minor repairs may be worth much more than their respective costs.  This checklist provides a reminder of the repairs and cleaning chores that can be very beneficial.

For more information, see:

 CLOSING COSTS

 HOME SALE WORKSHEET

 PROGRESS CHART

 REAL ESTATE AGENTS


 Real Estate Lease

 A real estate lease is a written document that sets forth an agreement between a landlord (lessor) and a tenant (lessee) regarding the responsibilities and obligations of each party.  A landlord is an owner of real estate (also known as "premises") who leases (rents) that property to a tenant for the tenant's use.  A "residential" lease applies to real estate used as a residence, while a "commercial" lease applies to business property.

This program's real estate lease documents offer a variety of optional provisions that can be tailored to specific situations.  A lease should be used whenever renting property to avoid conflict between the tenant and the landlord in the event of a disagreement.

For more information, see:

 ARBITRATION

 GENERAL PROVISIONS - LEASE

 LEGAL DESCRIPTIONS

 MAINTENANCE

 REAL ESTATE DOCUMENTS

 SECURITY DEPOSIT

 SUBLET

 SUBORDINATION OF LEASE

 TERMINATION ON SALE


 Legal Descriptions

 A legal description helps identify the exact real estate that will be subject to the lease.  For residential property it may be adequate to use a street address and/or apartment number to identity the leased property.  For commercial leases it may be more important to include an accurate legal description.

The legal description will be found in the legal documents (perhaps a deed) under which the property ("premises") was purchased.  The legal description may also be available from the local taxing authority responsible for real estate tax assessment and collection.  Some legal descriptions are too lengthy for the space provided by this program.  If that is the case, a copy of the legal description can be attached to the lease agreement as an exhibit.  The legal description should be entered EXACTLY as it appears on the deed or other legal document.

For more information, see:

 ARBITRATION

 GENERAL PROVISIONS - LEASE

 REAL ESTATE LEASE

 SUBORDINATION OF LEASE

 TERMINATION ON SALE


 Security Deposit

 A security deposit is an amount of money given to a landlord (or lessor) by a tenant (or lessee) that can be used by the landlord to offset damages to the leased property.  Some states limit the amount of the security deposit (for example, no more than twice the monthly rental amount).  In addition, some states require that the security deposit be retained in a separate account, and sometimes, in an interest bearing account.  Finally, some states require that the tenant of a residential lease be provided an accounting and/or refund of the deposit within a specified period of time after the Tenant has moved out.

For more information, see:

 GENERAL PROVISIONS - LEASE

 REAL ESTATE LEASE


 Maintenance

 It is important to clearly indicate who is responsible for which maintenance items.  Generally, the landlord (lessor) is responsible for most maintenance items in a residential lease (in fact, most states require the residential landlord to  keep the premises "fit for occupation"), while maintenance responsibilities are often delegated to the tenant (lessee) in commercial leases.  In using this program, it is important NOT to delegate responsibility for the same maintenance item to both parties.

For more information, see:

 GENERAL PROVISIONS - LEASE

 REAL ESTATE LEASE

 SECURITY DEPOSIT

 SUBLET

 SUBORDINATION OF LEASE

 TERMINATION ON SALE


 Sublet

 A "sublet" or "sublease" is a lease by a tenant/lessee to a third party of all or a part of the property that the tenant/lessee is leasing from a landlord/lessor.


 Termination on Sale

 A "termination on sale" provision permits the landlord (lessor) to terminate the lease if the leased property is sold to a third party.  If this provision is not included, the tenant (lessee) would have continued rights under the lease, even if the property was sold.

For more information, see:

 ARBITRATION

 GENERAL PROVISIONS - LEASE

 LEGAL DESCRIPTIONS

 REAL ESTATE LEASE

 SECURITY DEPOSIT

 SUBLET

 SUBORDINATION OF LEASE


 General Provisions - Lease

 A lease should include provisions that (i) make it clear that the agreement contains the entire agreement of the parties, (ii) require changes to the agreement to be in writing, signed by both parties, (iii) protect the agreement if one of its provisions is unenforceable, (iv) make it clear that the rights of the parties are cumulative (can use all rights), not exclusive (limited to the right that is exercised first), and (v) specify which state's laws will govern disputes between the parties.

For more information, see:

 ARBITRATION

 LEGAL DESCRIPTIONS

 MAINTENANCE

 REAL ESTATE LEASE

 SECURITY DEPOSIT

 SUBLET

 SUBORDINATION OF LEASE

 TERMINATION ON SALE


 Subordination of Lease

 A subordination of a lease is an agreement that the rights of a tenant (lessee) are lower in priority (subordinate) to the rights of a bank or other third party holding a mortgage on the leased property.


 Arbitration

 In arbitration proceedings, the parties allow an independent third party (arbitrator) to conduct a hearing to determine the facts and issues related to the dispute.  The arbitrator then issues a decision that resolves the dispute, perhaps similar to a decision by a court or jury in a lawsuit.  Most arbitration proceedings do not require the additional time and expense of court proceedings.  The arbitration option is offered in this program commercial lease, but not in the residential lease.

The American Arbitration Association (AAA) is a not-for-profit public service group that offers arbitration services to settle disputes involving contracts and other legal matters.  The AAA charges fees for arbitration based on a percentage of the amount in controversy.  More information on the AAA can be obtained from:

American Arbitration Association

140 West 51st Street

New York, NY 10020-1203

(212) 484-4000

For more information, see:

 GENERAL PROVISIONS - LEASE

 LEGAL DESCRIPTIONS

 MAINTENANCE

 REAL ESTATE LEASE

 SECURITY DEPOSIT

 SUBLET

 SUBORDINATION OF LEASE

 TERMINATION ON SALE


Creating Documents for Others

 Generally, most (if not all) states have laws restricting or limiting legal services provided by persons who have not received legal training.  The theory supporting such laws is that the general public needs to be protected from the possibility that persons who lack proper training will provide inappropriate or incorrect legal advice or services. This theory is similar to the theory that medical treatment and medical services should be provided primarily (if not solely) by persons who have medical training.

There are several notable exceptions to the rules regarding legal services.  For example, preparing income tax returns or providing advice regarding income tax returns is a legal service not limited to lawyers.   Similarly, real estate agents frequently prepare deeds and other real estate documents; in such cases, legal services are being provided by non-lawyers.

The use of this program to prepare documents for family members and friends without charge may be permissible under your state's laws.  If you charge for such services, it is more likely that you will have a problem.  Contact an attorney who is familiar with your state's laws if you have further questions.

For more information, see:

 EMPLOYMENT DOCUMENTS

 FINANCIAL DOCUMENTS

 POWER OF ATTORNEY

 WILLS AND TRUSTS

 EXHIBIT

 DOCUMENT INFORMATION TOPIC LIST


 Joint Living Trust

 A Joint Living Trust can be created by a person and that person's spouse.  In some cases, this method is preferable to creating two separate Living Trusts, especially where assets to be contributed are held jointly and could not easily be divided to be placed into two separate trusts. Another advantage is that the joint trust is created in a single document rather than multiple documents.

Typically, the Joint Living Trust provides for both spouses, who are the Co-Grantors, to serve as Co-Trustees.  They serve for such time as they are able and willing to manage the assets of the trust during their joint lives.  After the death or "disability" of one, the survivor or competent spouse can continue as trustee.

  Distributions

During the Co-Grantors' lifetime, distributions are made to them in fixed periodic amounts.  The amount of the distributions can be changed from time to time at the request of either Grantor.

  Beneficiaries

When the first spouse dies, the trust provisions designate the beneficiaries who will receive the Grantor's property. At the option of the Grantor, these provisions include specific bequests, distributions of tangible personal property, and distributions of the trust assets contributed by that person.  These provisions can also include retaining those assets within the trust for the benefit of the remaining spouse and/or the minor children.  If the deceased spouse was serving as a trustee, the successor trustee (which may be the surviving spouse, now as surviving co-trustee), carries out these provisions of the first spouse's directions.

  Important Factors to Consider

There are several important factors that must be considered in creating and using a Joint Living Trust, in addition to the factors that apply to an individual Living Trust.  (Read the  "Living Trust" topic for information about the individual Living Trust; read the  "Living Trust Advantages" topic for the advantages of a living trust in comparison to the Simple Will.)

1.   TAX CONSEQUENCES.  Generally, the income earned on the assets transferred into a Joint Living Trust is taxable to the spouses on their individual or joint return, provided that at least one spouse acts as trustee.

Furthermore, upon the death of the first spouse, the assets are generally given a "stepped-up basis" to Fair Market Value. This can become significant if the assets are eventually sold. Normally, taxable gain is computed based on the total appreciation of the assets over their cost. "Stepping up the basis" means that any such appreciation to the date of death can be ignored, and the new assumed "cost" of the asset is its Fair Market Value at the date of death.

For example, assume Joe and Mary purchased 100 shares of stock for $1000 after they were married, and then contributed this stock to their Joint Living Trust.  Joe died when the Fair Market Value of the stock was $2500, having appreciated in value by $1500.  As surviving trustee of the Joint Living Trust, Mary later decided to sell the stock when it had appreciated even further to a Fair Market Value of $3000. Without a "Step-up in Basis", Mary would have had to report a taxable gain of $2000 ($3000 selling price less the original cost of $1000).  But with the "stepped-up basis" to the $2500 Fair Market Value at the date of Joe's death, Mary need only report taxable gain of $500 ($3000 selling price less the new $2500 stepped-up basis).

With proper planning, this step-up in basis may be available for all assets within the Joint Living Trust, even for those assets originally purchased and contributed by the survivor and  for community property (in community property states) attributable to the surviving spouse. This constitutes one of the main advantages of the Joint Living Trust over those of the individual Living Trust.  For property that is held jointly (for example, real estate held jointly by spouses), you should obtain the advice of a tax professional or attorney in order to ensure that the property is transferred properly.

2.   TRANSFERRING ASSETS.  Where assets are held jointly between spouses, transferring them into a Joint Living Trust avoids having to fund two separate trusts with personal assets that may not be easily divided.  If those assets were held jointly with survivorship rights, such survivorship status may be lost, but any income earned from it is still jointly taxable and the asset still benefits the survivor upon the death of the first spouse.  On the other hand, if the survivorship status can be maintained, there may be greater creditor protection for the Surviving Grantor. If these considerations are important to you, obtain the advice of a tax professional or attorney.

3.   ESTATE PLANNING.  As with the individual Living Trust, if the joint estate is larger than $450,000, it may be desirable to use more complex estate planning techniques that are not provided by this program.

For more information, see:

 AMENDED LIVING TRUST

 WILLS AND ESTATE PLANNING

 FUNDING THE TRUST

 JOINT PROPERTY

 LIFE INSURANCE/ANNUITY/PENSION PLAN DESIGNATIONS

 POUR OVER WILL

 PROTECTION OF BENEFICIARIES

 REVOCATION OR AMENDMENT

 SIMPLE WILL

 SPECIFIC BEQUESTS

 SPOUSES

 TANGIBLE PERSONAL PROPERTY

 TRUST FOR CHILDREN

 TRUSTEE AND EXECUTOR POWERS

 WILLS AND TRUSTS


Joint Living Trust
 Revocation or Amendment of the Trust

 This Trust includes provisions which reserve to the Grantors the right to unilaterally revoke or jointly amend the Trust. The Grantors must deliver to the Trustee an appropriate written revocation or amendment, signed by the Grantor that elect(s) to revoke the Trust, or that sets forth the provisions that have been changed. If the Trust is being changed, it may be easier to simply restate the Trust by completing a new document.

For more information, see:

 AMENDED LIVING TRUST

 JOINT LIVING TRUST


 Amended Living Trust

 There may be occasions when it becomes desirable to amend a Living Trust or Joint Living Trust after the trust has become operational. For example, the Grantor may wish to change a beneficiary, a trustee, or add a new provision.  For such cases, this program offers an optional sentence that can be included in the "Opening" section. This sentence provides that the trust agreement is "amending and restating" the prior trust agreement.  By including this reference to the prior agreement, the new agreement has the effect of simply continuing the current trust which was established under the prior agreement, but with the desired change.  This "continuation" means that a new trust is not being created, and therefore, it is not necessary to transfer assets from an "old" trust into a "new" trust.

The trust is not considered "operational" until it has been signed and assets have been transferred into the trust.  Therefore, it is not necessary to use this feature if a prior trust agreement was signed, but not made operational by transferring assets into the trust.  An attorney should be consulted regarding any questions.

For more information, see:

 LIVING TRUST

 JOINT LIVING TRUST


 Risk of Defects

 The common law with regard to Landlord or Tenant liability for defects in the premises is well established.  The Landlord is liable for dangerous conditions which are known to the Landlord but not disclosed to the Tenant.  The Landlord is also liable for dangerous conditions which the Landlord could have learned by the exercise of proper care and diligence.  In fact, the Landlord is considered to have "constructive knowledge" of a dangerous condition where it can be shown that the condition occurred with regularity and was therefore foreseeable.  The Landlord has a duty to reasonably inspect the premises before allowing the Tenant to take possession, and to make the repairs necessary to transfer a reasonably safe dwelling unit to the Tenant unless defects are waived by the Tenant.

On the other hand, the Tenant is held responsible for dangers existing prior to the lease and which were obvious or which should have been discovered upon reasonable investigation by the Tenant. In other words, the Landlord has no duty to advise a Tenant of a condition which is readily apparent.

Finally, when the Tenant accepts the rental premises, the Tenant does not relieve the Landlord of his responsibility to disclose (or repair) defects that are "latent" (e.g. hidden) and could not have been discovered by a reasonably careful inspection.

This optional section probably does not change the rights and duties of the Landlord and Tenant with respect to each other, whether or not it is included.  However, including the section serves to highlight the respective duties of the parties and serves as an educational and informational tool. Landlords will want to include this section because it notifies the Tenant of what the Landlord is not responsible for.  Tenants may choose not to include this section, even though including it probably does not alter their legal relationship with the Landlord.

For more information, see:

 RENTER'S INSPECTION WORKSHEET

 SMOKE DETECTION


 Renter's Inspection Worksheet

 The Renter's Inspection Worksheet may be used by either a Landlord or a Tenant to determine the condition of rental premises both before and after the Tenant's occupancy of the premises. Prior to taking possession of the rental premises, the Tenant will want to be sure that both parties are in agreement with regard to the condition of each of the items contained in the rental premises.  This is because the Tenant will be required to return the items to the Landlord, at the end of the lease term, in the same condition as when the Tenant took possession of them at the beginning of the term, except for normal wear and tear.  Any deterioration greater than normal wear and tear will entitle the Landlord to deduct an appropriate amount from the security deposit given by the Tenant.  Therefore, the Tenant will want to document very carefully the condition of the items both at the beginning of the term and when the lease terminates so that he is only held responsible for damages that he caused.

For more information, see:

 RISK OF DEFECTS

 SMOKE DETECTION


 Smoke Detection

 The proper operation and maintenance of the smoke alarm is so vital to both the Tenant and the Landlord that special attention should be given to this item.  The Landlord should show the Tenant the smoke alarm paragraph, take the Tenant to where the smoke alarm(s) is/are located, demonstrate how they work, and ask the Tenant to initial the paragraph to indicate that the Tenant knows how to maintain the smoke alarm and agrees to be responsible for such maintenance.

For more information, see:

 RENTER'S INSPECTION WORKSHEET

 RISK OF DEFECTS


 Homeowners' Association Proxy

 The term "proxy" has two meanings.  First, it refers to a person who is given the authority to represent, vote and exercise the powers held by the person who designates the proxy (the "Homeowner").  Second, the term "proxy" also refers to the document under which the Homeowner gives the power to the person who will represent the Homeowner at a meeting of the Homeowners' Association.  Thus, a proxy document is actually a special power of attorney.  In many cases, the proxy is given to another Homeowner.

A land developer may provide for the formation of an association of people who own homes in a given area in restrictive covenants or a declaration associated with the residential development.  The purpose of a Homeowners' Association is to improve or maintain the quality of the area.  Generally all Homeowners automatically become members of the association upon purchasing a residential unit within the development.  The association may be formed as a corporation or may operate more informally as simply an association of home owners.

The rules governing such associations are generally stated in a document of formation or in Bylaws of the association. Additional requirements or restrictions on such associations may be contained in state law.

For more information, see:

 DURATION OF HOMEOWNERS' ASSOCIATION PROXY

 AUTHORITY OF HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' QUORUM WORKSHEET


 Duration of Homeowners' Association Proxy

 Generally, a designation of proxy is given to the Proxy with respect to just one Homeowners meeting.  Usually the reason for the proxy is because the Homeowner does not plan to attend the meeting in person, but wants to make sure that his or her vote is counted on any matters voted upon during the meeting.  If not enough Homeowners are present at the meeting (in person or by proxy), the Homeowners will be unable to conduct business at the meeting because of a failure to meet the association's quorum requirement.  Thus if a Homeowner is unable to attend the meeting, it is important that his or her proxy be designated so that the quorum requirement can be met.  The program allows the Homeowner to give a proxy for an unspecified period of time, but generally this is not done.  It is recommended that an individual Proxy be given for each meeting, even if the Homeowner knows in advance that a Proxy will be required for more than one meeting.  Some states limit the period for which a proxy is valid.  For example, twelve months.

For more information, see:

 HOMEOWNERS' ASSOCIATION PROXY

 AUTHORITY OF HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' QUORUM WORKSHEET


 Authority of Homeowners' Association Proxy

 Generally, a designation of proxy is given for one Homeowners' meeting, and the Proxy is given full power to vote the shares in the Proxy's discretion or in accordance with an informal oral arrangement between the Homeowner and the Proxy.  However, the Homeowner may wish to require the Proxy to vote a certain way on one or more specific issues. For example, if officers will be elected at an annual meeting, the Homeowner may wish to require the Proxy to vote for certain officers.  Or, there may be a key issue that will be decided, and the Homeowner wants to make that the Proxy votes "for" or "against" as the case may be.  This program's proxy document is designed to allow the Proxy full discretion to vote on all issues, although the Proxy may be required to vote "for" or "against" on specific issues. Unless the Proxy can vote on all issues properly raised at the meeting, the Homeowner as represented by the Proxy could be challenged as "not being present" for quorum purposes.

For more information, see:

 DURATION OF HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' QUORUM WORKSHEET


 Signature - Homeowners' Association Proxy

 1. 	The Homeowners' Association Proxy document should be signed and dated by the Homeowner. The Proxy need only be signed by the owner(s) who have been designated as the representatives or by the designated voter(s) of the residential unit, even if the unit is jointly owned. Voting requirements are described in the Association's bylaws or other documents.

2. 	Although a witness to the signing is not required in many states, it is advisable to have the signing of the Proxy document witnessed by a disinterested party (someone other than the Homeowner or the Proxy) in order to provide added assurance that the Proxy document will not be challenged.

For more information, see:

 AUTHORITY OF HOMEOWNERS' ASSOCIATION PROXY

 DURATION OF HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' QUORUM WORKSHEET


 Homeowners' Quorum Worksheet

 Usually a Proxy document is prepared because the Homeowner does not plan to attend the meeting in person, but wants to make sure that his or her vote is counted on any matters voted upon during the meeting.  Also, if not enough Homeowners are present at the meeting (in person or by proxy), the Homeowners Association will be unable to conduct business at the meeting because of a failure to meet the association's quorum requirement.  Thus if a Homeowner is unable to attend the meeting, it is important that his or her proxy be designated so that the quorum requirement can be meet.

This program presents a worksheet to be used by an officer of the association to determine whether a quorum is present at a meeting.  This worksheet lists each homeowner entitled to vote.  After preparing the worksheet, the officer charged with taking attendance (generally the Secretary) can mark those in attendance, plus those Homeowners represented by Proxy.  Before including a proxy towards the quorum requirement, the officers should verify that voting by proxy is permitted by the rules or Bylaws of the association.  The total of those present plus those represented by proxy must exceed or equal the number of Homeowners stated in the quorum requirements.  This worksheet should be kept with the minutes of the meeting.

For more information, see:

 AUTHORITY OF HOMEOWNERS' ASSOCIATION PROXY

 DURATION OF HOMEOWNERS' ASSOCIATION PROXY

 HOMEOWNERS' ASSOCIATION PROXY


Complex Wills and Trusts
 Wills

 This program includes Simple Will, Living Trust, Joint Living Trust, and Pour Over Will documents that are appropriate for most people.  However, if the value of the estate (after taking allowable deductions) is larger than $600,000, the estate may be subject to significant federal estate taxes. In some situations, state estate or inheritance taxes may become significant for estates of less than $600,000.  If significant taxes are a possibility, perhaps the tax burden can be reduced by using more complex estate planning techniques that are not provided by the documents included in this program.  Proper use of these techniques requires an evaluation of many factors that is best handled by an attorney or other estate planner who can make appropriate recommendations and prepare customized documents that are tailored to fit the situation.  For such cases, this program's Estate Planning Worksheet can be used to prepare for an office conference with an attorney who can assist with the preparation of a more complex will.  The topics for the Estate Planning Worksheet are particularly helpful in explaining more complex estate planning terms and concepts including "marital deduction", "credit trust", "marital trust", "QTIP trust", "generation skipping trust", "life insurance trust", and "charitable trust".

For more information, see:

 WILLS AND TRUSTS


Other Real Estate Documents
 Real Estate

 This program does not include certain types of real estate documents, including deeds, land contracts, and offer and acceptance contracts for the purchase of real estate.  Such documents vary significantly from one state to another, and in some cases, from one locality or county to another. Information regarding deed forms, land contracts, and offer and acceptance forms can be obtained from a local real estate agency, local attorney (or "bar") association, or the county "recorder", "register of deeds" or similar local office. There are a variety of deed forms (e.g., "warranty deed", "quit claim deed", "joint tenancy deed", "trustee deed", and "special warranty deed").  The correct deed form depends on the particular situation, and it is recommended that appropriate legal advice be obtained in choosing the appropriate form.  In addition, there may be other documents that must be filed with the deed, including a document that explains the value of the property being transferred. In some cases, a tax may be assessed on the transfer, and there will likely be a recording fee.

For more information, see:

 REAL ESTATE DOCUMENTS


Trademarks, Copyrights and Patents

 The information in this topic is not directly related to any particular document, but is included to provide general information that may be useful.

This program provides a licensing agreement that may be helpful in setting forth the basis for the use of a copyright, trademark, or patent by a third party, usually in exchange for the receipt of royalty payments.  This program does not provide the documents for obtaining or perfecting an interest in a copyright, trademark or patent.  A "mark" or "patent" must be registered or patented with the United States Patent and Trademark Office.  The process requires a search of existing marks and patents to assess the possibilities of registering a mark or obtaining a patent. The application is detailed and technical, and the information that is provided must be tailored to the particular situation.

For more information, see:

 BANKRUPTCY

 COPYRIGHTS

 PATENTS

 TRADEMARKS

 DOCUMENT INFORMATION TOPIC LIST


Patents

 The information in this topic is not directly related to any particular document, but is included to provide general information that may be useful.

A patent is a property right granted by the United States government to an inventor for a newly created invention. The patent allows the inventor to exclude parties from making, using or selling the invention from the date the patent is granted until 20 years after the date the patent application was filed.  In the case of a "design" patent, the term is 14 years from the date the patent is issued.

  Process of Filing For a Patent

The patent process is started by filing a patent application with the U.S. Patent and Trademark Office.  The patent is "pending" until it either issues or is abandoned.  The application can only be filed by the true inventor(s), but this right can be transferred to any other party, for example, an employer who hired the inventor.  The patent application must be filed no later than one year after the first publication or public use or sale of the invention in the United States by either the inventor or anyone else.  A patent will be issued only for an invention that is new, useful and meets the required standard of invention.  Thus, a patent will not be issued if the invention is too similar to something that is already publicly known, for example, an invention for which a patent has already been granted.

  Kinds of Patents

There are three kinds of patents.  The most common is a "utility" patent for the invention or discovery of: (i) a machine or article; (ii) a composition of matter; or (iii) the process of making or doing something (e.g., a new way of making tires).  "Composition of matter" refers to chemical compositions, and might include a new chemical compound or a mixture of ingredients.  Another kind of patent is a "design" patent which is issued for the ornamental design of an article of manufacture (e.g., the shape of a chair or a telephone).  The third kind of patent is a "plant" patent which is issued for the asexual reproduction of a new variety of plant (e.g., a new variety of hybrid seed corn).

The process of obtaining a patent involves the understanding of complex rules and regulations.  Although an inventor may file his or her own patent application, the U.S.  Patent and Trademark Office advises inventors to obtain the assistance of either a registered patent attorney or patent agent. More information can be obtained by contacting a patent attorney, local library, or the Commissioner of Patents and Trademarks, Washington, D.C.  20231.

For more information, see:

 COPYRIGHTS

 TRADEMARKS

 TRADEMARKS, COPYRIGHTS AND PATENTS


Trademarks

 The information in this topic is not directly related to any particular document, but is included to provide general information that may be useful.

A trademark is a word, name, symbol, device, or a combination of such items that identifies and distinguishes one party's "goods" from the "goods" of another party.  For example, "Kodak" is a familiar trademark that identifies the products of Eastman Kodak Company.  A service mark is the same as a trademark except that it identifies and distinguishes services, rather than products.  An example is "McDonald's", a service mark of McDonald's Corporation that identifies its restaurant services.

  Trademark or Service Mark Rights

The owner of a trademark or service mark can obtain rights that can be enforced against others who use a confusingly similar mark.  Such rights can arise by either (i) actually using the mark, or (ii) filing a proper application to obtain a federal registration of the mark with the U.S. Patent and Trademark Office.  If a mark is used only locally, it may not qualify for federal registration. However, all of the states also have registration laws. Although neither federal nor state registration is required, federal registration especially provides many important rights and benefits beyond the rights that are acquired by simply using the mark.  For example, the owner of a mark can establish national rights by federal registration even though the mark is used only in a few states.  Rights can also be established before using the mark by filing an intent-to-use application for federal registration.

The symbol "TM" can be used in connection with the mark for any product ("SM" for services) for which a party claims a right, while the registered trademark symbol, "(R)", may only be used in connection with a mark for which a party has been issued a federal registration.

Rights to a mark continue as long as the owner continues to use the mark to identify goods or services.  A registration with the U.S.  Patent and Trademark Office is issued for ten years and is valid as long as the mark is used.  The registration may be renewed for additional 10 year periods as long as the mark continues to be used.  Between the fifth and sixth years of the first term, proof of use must be made with the Trademark Office to prevent the registration from being canceled.

More information can be obtained by contacting an attorney, local library, or the Assistant Commissioner for Trademarks, 2900 Crystal Drive, Arlington, VA 22202-3513.

For more information, see:

 COPYRIGHTS

 PATENTS

 TRADEMARKS, COPYRIGHTS AND PATENTS


Copyrights
 The information in this topic is not directly related to any particular document, but is included to provide general information that may be useful.

A copyright is a property right given to the author of any original artistic or literary work (e.g., a book, musical work, painting, sculpture, movie, sound recording, or computer software).  Subject to certain exceptions, copyright protection gives the author the exclusive rights to reproduce or copy the work, prepare related works that are derived from the original work, perform the work publicly, distribute materials that include the work, and display the work publicly.

Under federal law, a copyright exists immediately upon the creation of the artistic or literary work in any tangible form.  Copyright protection is fully maintained by including a proper copyright notice on the work when it is made public and on all copies of the work that are publicly distributed. The notice consists of three elements: (i) the symbol "(c)", the word "Copyright", or the abbreviation "Copr."; (ii) the year of first publication, and (iii) the name of the owner of the copyright.  For example, "Copyright 1995, Jane Doe".

Although the author is not required to file an application or complete any registration requirements to obtain copyright protection, it is recommended that registration be made promptly after the work is made public in order to preserve all the rights and remedies available to the copyright owner.

  Copyright protection

Generally, copyright protection continues for the author's life, plus 50 years.  However, if the author prepared the work as a "work for hire" (e.g., for an employer), protection is provided for 75 years after the work's first publication, or 100 years after its creation, whichever occurs first.

There are several exceptions to the author's exclusive rights to a copyrighted work.  These exceptions apply to specific situations and a number of conditions must be met for an exception to apply.  Under the "fair use" doctrine, another party (without paying compensation to the author) may use the work in connection with teaching, research, news reporting and comment, if certain complex guidelines are met.  The guidelines focus on whether or not the unauthorized use provides a financial gain to the user, how much of the copyrighted work is used, and the effect of the use on the value of the copyright to the author.  There are other very limited exceptions for libraries, copies made for private home use, and some types of public performances in certain non-commercial settings.  The rules relating to these exceptions are complex, and it is usually not a good idea to copy any work containing a copyright notice without understanding these rules.

More information can be obtained by contacting an attorney, local library, or "Information Section, LM-401, Copyright Office, Library of Congress, Washington, D.C.  20559.

For more information, see:

 PATENTS

 TRADEMARKS

 TRADEMARKS, COPYRIGHTS AND PATENTS


 Bankruptcy

 The information in this topic is not directly related to any particular document, but is included to provide general information that may be useful.

This program does not provide the documents that are required to file bankruptcy in the federal bankruptcy court system.  The forms and requirements vary considerably depending on the circumstances and whether the party filing the bankruptcy is a business or individual.  Further, the required procedures may vary from one district court to another, depending on the degree to which the court procedures have been computerized and other factors. Information regarding the required procedures can be obtained by contacting the appropriate federal district bankruptcy court.  Generally, there are 1 to 5 districts in each state, with local offices in many of the larger cities. Family Lawyer's Personal Fact Sheet may be helpful in organizing personal and financial information that will be required.

Bankruptcy is a legal process used by an individual or business (a "debtor") to obtain relief from financial obligations owed to creditors.  This process is governed by the federal Bankruptcy Code and is administered through the federal bankruptcy court system.  The public policy supporting the Bankruptcy Code is that a debtor should be given a "fresh start" at the expense of the debtor's creditors so that the debtor does not become completely impoverished, perhaps requiring financial support from the government / society.  While the creditors usually receive only a small percentage of the amount owed to them (maybe even nothing), the bankruptcy process provides an orderly process that is designed to prevent some creditors from receiving an unfair advantage over other creditors. Generally, a debtor may not receive bankruptcy relief more often than once every seven years.

  Filing Requirements

A debtor may file for bankruptcy on a voluntary basis by filing certain documents with the bankruptcy court.  If certain conditions are met, the bankruptcy can be initiated by the debtor's creditors.  In either case, the debtor is required to provide information regarding the debtor's name and address, a statement of the debtor's assets and liabilities, a list of the names and addresses of the creditors, and information regarding the debtor's financial history.  The debtor must be careful to include all assets and all liabilities (e.g., loans, credit card obligations, judgments against the debtor, and lease obligations).  The intentional failure to answer correctly is a crime.

  Automatic Stay

Immediately upon the filing of a bankruptcy, the debtor is provided with a form of relief known as the "automatic stay." The automatic stay prevents creditors from further collection efforts on debts which existed at the time the bankruptcy was filed.  The stay remains in place during the bankruptcy, but may be "lifted" by the bankruptcy court to permit certain collection efforts.

  Chapter 7

The most common type of bankruptcy is a "liquidation" filing under Chapter 7 of the Bankruptcy Code.  In this type of bankruptcy, a trustee appointed by the bankruptcy court liquidates the debtor's non-exempt property to make payment to the creditors.  Usually, the creditors receive only a small portion of the total amount owed to them, perhaps only 5 - 10 percent.  The debtor is able to protect some "exempt" assets from being sold by the trustee to pay debts. Exemptions vary among states, but some typical examples of exempt assets include a home, a vehicle, and personal possessions such as clothing, household furniture and personal effects.  At the end of a Chapter 7 proceeding, the debtor's remaining unpaid debts are "discharged" and the debtor has no further legal obligation to pay those creditors.  In some cases, a debtor may choose to "reaffirm" a debt as part of the bankruptcy proceedings.  For example, to prevent a creditor from selling the debtor's automobile to pay off its lien on the car's title, the debtor may choose to reaffirm the debt and continue making payments in order to continue ownership of the vehicle.

  Chapters 11, 12, and 13

The other types of bankruptcy filings are "reorganization" or "restructuring" filings.  These types of filings include Chapter 11 (business reorganizations), Chapter 12 (farm reorganizations) and Chapter 13 (individual wage earners and small business restructuring).  All of these bankruptcies involve a restructuring or reorganization of the debtor's financial obligations.  Usually this means that the debtor is allowed to make smaller payments over a longer period of time, perhaps with a reduced interest rate.  If a reorganization or restructuring filing is successful, such a filing may carry less "stigma" for the debtor and may mean larger repayment amounts to the creditors than what they would have received in a Chapter 7 liquidation.

The information provided by this topic provides only a broad overview of a complex legal subject.  For more information, contact an attorney or the nearest branch office of the Legal Services Corporation.

For more information, see:

 DOCUMENT INFORMATION TOPIC LIST


 Divorce

 This program does not provide the documents that are required to file for and obtain a dissolution of marriage (divorce). The required procedures vary from state to state. Generally, both parties should be represented by an attorney, unless there are few assets and liabilities, each party can support himself/herself, and there are no children.  This program's Personal Fact Sheet may be helpful in organizing personal and financial information that may be required or useful.

For more information, see:

 PERSONAL FACT SHEET

 PREMARITAL AGREEMENT

 DOCUMENT INFORMATION TOPIC LIST


Family/Personal

 The Family/Personal documents apply to a variety of personal situations.  The Personal Fact Sheet can be used to organize personal and financial information.  The Child Care Authorization, Child Care Instructions, and Letter to School are related documents that are useful in providing authority, information, and instructions to persons who will be providing short-term care for a child (e.g., a school teacher or a babysitter).  A Premarital Agreement is an agreement between prospective spouses that explains property rights, sharing of living expenses, support obligations, and other issues.  The Memorial Services is a worksheet that provides an opportunity to state personal wishes regarding funeral or memorial services, and related issues that occur upon a death.

For more information, see:

 CHILD CARE DOCUMENTS

 MEMORIAL SERVICES

 PERSONAL FACT SHEET

 PREMARITAL AGREEMENT

 DOCUMENT INFORMATION TOPIC LIST


 Complaint to Better Business Bureau or Attorney General's Office

1.   The Complaint to a Better Business Bureau or Attorney General letter should be signed by the writer at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   Photocopies, rather than original copies, of any relevant documents should be included with the letter.  The writer should keep a copy of all correspondence to and from the Better Business Bureau or Attorney General, and should maintain a written summary of all telephone conversations.

3.   Copies of any letters previously sent to the company in an attempt to resolve the problem should be enclosed with the letter to the Better Business Bureau or Attorney General.


 Complaint to a Company

1.   The Complaint to a Company letter should be signed by the writer at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   Photocopies, rather than original copies, of any sales receipts or other relevant documents should be included with the letter.  The writer should keep a copy of all correspondence to and from the company or agency, and should maintain a written summary of all telephone conversations.

3.   If a resolution to the problem is promised during a telephone conversation, the company representative should be asked to confirm the promise in writing.  If no written confirmation is received from the company, the writer should mail his or her own letter which confirms the conversation and includes the name of the company representative, the date of the conversation, and the resolution offered.


 Demand for Money Owed

1.   The Demand for Money Owed letter should be signed by the Creditor (and the Joint Creditor, if any).  A copy of the letter should be retained by the writer for his or her records.

2.   Photocopies, rather than original copies, of any relevant documents should be included with the letter.  The writer should keep a copy of all correspondence to and from the debtor, and should maintain a written summary of all telephone conversations.

3.   Before mailing the Demand for Money Owed letter, the writer should investigate all appropriate state regulations regarding collections, as well as the federal Fair Debt Collection Practices Act, in order to determine whether or not the letter complies with their provisions.


 Request for a Credit History

1.   The Request for a Credit Report letter should be signed by the writer at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   Before mailing the letter, the credit bureau should be contacted in order to determine the appropriate fee amount, whether proof of identity is required, and whether there are any other requirements of the bureau.

3.   If the request for a credit report is being made because of a recent denial of credit, a copy of the denial letter should be enclosed with the request.  There should be no fee required for a credit report which is requested because of a denial of credit, provided that the request is made within 30 days of the notification of the denial.

4.   If proof of identity is required, photocopies, rather than original copies, should be included with the letter.


 Challenge to a Denial of Credit

1.   The Challenge to a Denial of Credit letter should be signed by the Applicant at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   If the challenge relates to a joint application for credit, both applicants should sign the letter.

3.   A request for additional information and/or for the reasons for the denial of credit must be made within 60 days following the writer's receipt of the credit denial.  The lending institution generally must respond to this request within 30 days.


 Challenge to a Credit Report

1.   The Challenge to a Credit Report letter should be signed by the writer at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   If the challenge relates to a joint credit report, information regarding both persons listed in the report should be included in the letter, and both persons should sign the letter.

3.   A photocopy of the relevant credit report should be enclosed with the letter.  If a specific entry in the report is being challenged, that entry should be marked or highlighted so that it can be easily identified.


 Recourse Against Collection

1.   The Recourse Against Collection letter should be signed by the Debtor (and the Joint Debtor, if any) at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   If the letter is being mailed in response to a demand for payment, and that demand is based upon an inaccurate balance, possibly because a payment or an earned discount was not applied, then photocopies, not original copies, of receipts, canceled checks, or other documents supplying proof of the credit should be enclosed with the letter.


 Employment Agreement

1.   The Employment Agreement should be signed by both parties.  It becomes effective as of the date inserted at the beginning of the Agreement.  It is not necessary that the signatures be witnessed or notarized.

2.   It is advisable to sign two copies of the Agreement so that each party will have a copy with original signatures. Original copies should be kept in a fire-proof and safe location.

3.   This document should not be used if the Employee is covered by a collective bargaining agreement, if the Employee is considered to be a consultant, or if the Employee is considered to be an independent contractor.

4.   An attorney should be consulted regarding any unique issues not addressed by this program.

5.   This document should be reviewed periodically to evaluate whether circumstances have changed enough to warrant changes to the Employment Agreement.


 Letter of Acceptance

1.   The Letter of Acceptance should be signed by the Employee at the end of the letter and a copy of the letter should be retained.  This Letter should be mailed to the Employer immediately after the final interview has taken place during which employment was offered.

2.   The Letter of Acceptance is used to confirm what the Employee believes to be the agreement between the parties, and to formally accept the offer of the employment itself, as well as the terms and benefits discussed.  However, because the Employer has not signed the Acceptance, this Letter is not effective as an official employment contract. As the final step, the parties should prepare and sign an Employment Agreement.


 Offer of Employment

1.   The Employment Confirmation Letter should be signed by the Employer at the end of the letter and a copy of the letter should be retained.

2.   The Letter should be mailed to a potential employee immediately after the final interview and prior to the time that the Applicant accepts the job offer.  This letter merely confirms the company's understanding of the terms and conditions that were discussed with the Applicant during the interview.

3.   Note: This letter is not an Employment Agreement and the terms contained in the letter will not be considered binding upon the Applicant.  If the Applicant formally accepts the company's offer, an Employment Agreement should be prepared and signed by the parties.


 Consulting Agreement

1.   The Consulting Agreement should be signed by both parties and becomes effective as of the date specified in the Agreement.  It is not necessary that the signatures be witnessed or notarized.

2.   Note: The Consulting Agreement should only be used for a party who is an "independent contractor" with respect to the Company.  If instead, the arrangement between the Company and the Consultant conforms more closely to the characteristics of an employee/employer relationship, the Employment Agreement may be more appropriate.

3.   It is advisable to sign two copies of the Agreement so that each party will have a copy with original signatures. Original copies should be kept in a fire-proof and safe location.

4.   An attorney should be consulted regarding any issues not addressed by this program.


 Confidentiality Agreement

1.   The Confidentiality Agreement should be signed by both parties and becomes effective as of the date specified in the Agreement.  It is not necessary that the signatures be witnessed or notarized.

2.   It is advisable to sign two copies of the Agreement so that each party will have a copy with original signatures. Original copies should be kept in a fire-proof and safe location.

3.   An attorney should be consulted regarding any issues not addressed by this program.


 Bill of Sale

1.   The Bill of Sale document should be signed by both parties.  It is not necessary that the signatures be witnessed or notarized.

2.   This document cannot be used to transfer real estate. Furthermore, any personal property that has been pledged as security for a loan should not be transferred until a release has been obtained from the party to whom the loan is owed.

3.   After the Bill of Sale is signed by both parties, legal ownership of the property is transferred, effective as of the date provided in the document, regardless of which party has possession of the property.

4.   The original copy of the Bill of Sale should be given to the Buyer.  The Seller should retain a copy.


 Promissory Note

1.   The Promissory Note must be signed and dated by the Promisor.  The Promisor's city and state should also be included on the note.  No witnesses or notarization are required.

2.   The original copy of the Note should be given to the Payee.  The Promisor should retain a copy.

3.   The Promissory Note should be reviewed periodically to ensure that no defaults have occurred.  If the Promisor fails to make a payment on any given due date, the Payee should notify the Promisor promptly and inform the Promisor of relevant penalty provisions which may be imposed because of the default.


 Equipment Lease

1.   The Equipment Lease should be signed and dated by both the Lessor and the Lessee.  It is not necessary that the signatures be witnessed or notarized.  The Agreement becomes effective as of the date indicated in the document.

2.   Both parties should retain a copy of the signed Lease in a secure location.

3.   The document should be reviewed periodically to ensure that the parties are each complying with their respective obligations.


 License Agreement

1.   The License Agreement should be signed and dated by both parties.  It is not necessary that the signatures be witnessed or notarized.  The Agreement becomes effective as of the date indicated in the document.

2.   Both parties should retain a copy of the signed Agreement in a secure location.

3.   The document should be reviewed periodically to ensure that the parties are each complying with their respective obligations.


 Corporate Minutes

1.   The Corporate Minutes should be signed by the corporate secretary or another person who is authorized to take minutes and/or record official corporate action.  There is no requirement that the signature be witnessed or notarized.

2.   In order to ensure compliance with the relevant state corporate laws, it is recommended that an attorney review the corporate minutes upon their completion.  This step can become especially important if the corporation has more than one class of stock or if it is involved in unusual transactions.


 Notice/Waiver of Notice

1.   The Corporate Notice should be signed by the appropriate corporate official, which is usually the secretary.  There is no requirement that the signature be witnessed or notarized.  The Notice should be mailed to all members of the relevant group, e.g., shareholders, directors or members, at their current addresses.

2.   The Corporate Waiver of Notice should be signed and dated by each member of the relevant group, e.g., shareholders, directors, or members.  There is no requirement that the signatures be witnessed or notarized.


 Unanimous Consent

1.   The Unanimous Consent should be signed and dated by each member of the relevant group, e.g.  shareholders, directors or members.  It is not sufficient that a mere majority of the group members sign the document; it must be unanimous.

2.   There is no requirement that the signatures be witnessed or notarized.


 Corporate Worksheet

1.   The Corporate Worksheet is not a legal document and does not require any signature, witnesses, or notarization.

2.   The Worksheet can be printed and/or updated as needed.


 Business Entity Planning Worksheet

1.   The Business Entity Planning Worksheet is not a legal document and does not require any signature, witnesses or notarization.

2.   The Worksheet is an educational tool, and can be used to organize the characteristics of a proposed business in order to facilitate planning.  However, before making a final selection, an attorney, accountant or other tax professional should be consulted.


 General Power of Attorney

1.   The General Power of Attorney should be signed by a Grantor who is mentally competent and the signature should be notarized.  Notarization makes it harder for a third party to challenge the validity of the signature, and allows the document to be "recorded" for use with real estate transactions, if recording becomes necessary or advisable. Four states -- Florida, North Dakota, Ohio and South Carolina -- require that the Power of Attorney be signed in the presence of witnesses.  Furthermore, in some states, the name of the person who prepared the Power of Attorney document must be indicated in the document in order for it to be recorded.

2.   If the Power of Attorney includes the power to mortgage or sell real estate, it may be necessary to include the legal description of the property, especially if the document applies to the Grantor's personal residence.  The legal description must appear exactly as it is described on the deed or abstract of title.

3.   The Agent designated in the document should be advised of the location of the original copy of the Power of Attorney document and given access to that original.  The Grantor should retain a copy for his or her files.

4.   CAUTION: BEFORE SIGNING THIS DOCUMENT, THE GRANTOR SHOULD CONSIDER ITS CONSEQUENCES.  THE GRANTOR IS PROVIDING ANOTHER PERSON (THE AGENT) WITH THE POWER TO HANDLE BUSINESS AND LEGAL MATTERS ON HIS OR HER BEHALF.  ANY SUCH ACTION UNDERTAKEN BY THE AGENT WITHIN THE SCOPE OF THE POWER OF ATTORNEY DOCUMENT IS LEGALLY BINDING UPON THE GRANTOR.


 Special Power of Attorney

1.   The Special Power of Attorney should be signed by a Grantor who is mentally competent and the signature should be notarized.  Notarization makes it harder for a third party to challenge the validity of the signature, and allows the document to be "recorded" for use with real estate transactions, if recording becomes necessary or advisable. our states -- Florida, North Dakota, Ohio and South Carolina -- require that the Power of Attorney be signed in the presence of witnesses.  Furthermore, in some states, the name of the person who prepared the Power of Attorney document must be indicated in the document in order for it to be recorded.

2.   If the Power of Attorney includes the power to encumber or transfer real estate, it may be necessary to include the legal description of the property, especially if the document is intended to be able to encumber or transfer the Grantor's personal residence.  The legal description must appear exactly as it is described on the deed or abstract of title.

3.   The Agent designated in the document should be advised of the location of the original copy of the Power of Attorney document and given access to that original.  The Grantor should retain a copy for his or her files.

4.   CAUTION: BEFORE SIGNING THIS DOCUMENT, THE GRANTOR SHOULD CONSIDER ITS CONSEQUENCES.  THE GRANTOR IS PROVIDING ANOTHER PERSON (THE AGENT) WITH THE POWER TO HANDLE BUSINESS AND LEGAL MATTERS ON HIS OR HER BEHALF.  ANY SUCH ACTION UNDERTAKEN BY THE AGENT WITHIN THE SCOPE OF THE POWER OF ATTORNEY DOCUMENT IS LEGALLY BINDING UPON THE GRANTOR.


 Revocation of Power of Attorney

1.   The Revocation of Power of Attorney (whether General or Special) must be signed by the Grantor AND it must be presented to the Agent, in order to provide evidence of the Grantor's intent to revoke the Power of Attorney.  The Revocation should also be notarized.

2.   Because the Agent must be given a copy of the Revocation, it is recommended that the Revocation be mailed by certified mail to the Agent's last known address. Alternatively, a copy of the Revocation may be hand delivered to the Agent, in which case, the Agent should sign the document acknowledging receipt of the Revocation.


 Residential Real Estate Lease

1.   The Residential Real Estate Lease should be signed by both the Lessor and the Lessee.  Although oral leases may be binding on the parties, most states require that a lease with an initial term of more than one year must be signed, and it is strongly recommended that all leases be signed.

2.   Some states require that if a lease exceeds a specified number of years, it must be recorded in the public records, which, in turn, usually requires that the document must be notarized.  If the original term of the lease will extend beyond one year, the specific requirements of the relevant state should be determined with respect to notarizing and/or recording the Lease.

3.   Both parties should retain a copy of the signed Lease and place them in a secure location.


 Commercial Real Estate Lease

1.   The Commercial Real Estate Lease should be signed by both the Lessor and the Lessee.  Although oral leases may be binding on the parties, most states require that a lease with an initial term of more than one year must be signed, and it is strongly recommended that all leases be signed.

2.   Some states require that if a lease exceeds a specified number of years, it must be recorded in the public records, which, in turn, usually requires that the document must be notarized.  If the original term of the lease will extend beyond one year, the specific requirements of the relevant state should be determined with respect to notarizing and/or recording the Lease.

3.   Both parties should retain a copy of the signed Lease and place them in a secure location.


 Home Purchase Worksheet

1.   The Home Purchase Worksheet is not a legal document and does not require any signature, witnesses, or notarization.

2.   This Worksheet provides a logical and organized description of the Buyer's preferences and therefore the relevant portions of the document can be given to a real estate agent who will attempt to locate suitable properties.


 Home Evaluation Worksheet

1.   The Home Evaluation Worksheet is not a legal document and does not require any signature, witnesses, or notarization.

2.   This Worksheet can be used by the Buyer to organize personal preferences and to review those preferences with a real estate agent and/or lender.


 Home Sale Worksheet

1.   The Home Sale Worksheet is not a legal document and does not require any signature, witnesses, or notarization.

2.   This Worksheet is designed to help the potential seller locate a real estate agent and/or to prepare the home for sale by the owner prior to "listing" the home for sale.


 Rental Application

1.   The Rental Application should be signed by the Applicant and any Co-Applicant.  The Applicant(s) should be provided with a copy of the Application.

2.   In signing the Application, the Applicant (i) verifies that the information provided is true and correct to the best of his or her knowledge, (ii) authorizes the Landlord to verify the references and employment information provided in the Application, and (iii) acknowledges receipt of a copy of the Application.

3.   The Rental Application includes a provision which allows the Landlord to sign after making a determination to accept or refuse the Applicant.  NOTE: A SIGNED ACCEPTANCE BY THE LANDLORD CONSTITUTES A LEGALLY BINDING PROMISE BY THE LANDLORD TO ENTER INTO A LEASE WITH THE APPLICANT.  While the acceptance of the Application does not constitute a lease itself, the Landlord is required to act in good faith to complete the process by negotiating rental terms that will be evidenced by a real estate lease.

4.   If the optional Employment Verification Letter is to be used, it should be signed by the Applicant(s) at the time that the Application is submitted to the Landlord.

5.   If the optional Request for Account Verification is to be used, it should be signed by the Applicant(s) at the time that the Application is submitted to the Landlord.


 Renters Inspection Worksheet

1.   The Renters Inspection Worksheet should be printed and taken to the rental premises, where it should be completed during a joint inspection by the Landlord(s) and the Tenant(s).  Comments should be included where appropriate.

2.   When the inspection and the Worksheet have been completed, the Worksheet should be dated and signed by both the Landlord(s) and the Tenant(s).  Each party should retain a copy.

3.   If the optional Smoke Detector Section is included, that section should be separately initialed by the Tenant at the time that the detector is tested.

4.   After the Tenant has moved out of the rental premises, the Worksheet should be used to make a comparison inspection of the dwelling.  Comments should be recorded on the Worksheet to indicate any items which have deteriorated more than what would be considered normal wear and tear.


 Estate Planning Worksheet

1.   The Estate Planning Worksheet is not a legal document and does not require any signature, witnesses or notarization.  If the total value of the net estate is less than $450,000, the Worksheet can now be used to prepare this program's Simple Will, Living Trust (and a Pour Over Will) or Joint Living Trust (and a Pour Over Will).  If the net estate exceeds $450,000, the Worksheet can be provided to an estate planning lawyer who will review this information for use in preparing an estate plan.

2.   If the person completing the Worksheet is married, it is necessary for each spouse to fill out a separate Worksheet.  Each worksheet should describe all of the property in which that person holds an interest, as well as the type of interest held.  Each spouse should also state his or her own intentions for their children, if any, because those intentions may differ from those of the other spouse.


 Living Trust

1.   The Living Trust should be signed by both the Grantor and the  Trustee. It is recommended that these signatures be notarized. However, unlike the Simple Will, no witnesses are necessary.

2.   The date should be filled in on the first page of the document.

3.   After signing the Living Trust document and creating the trust, the next step which must be taken is to legally transfer specific assets into the Trust.  The trust provisions will only apply to assets that have been placed into the Trust.  Assets can be transferred at the time of the creation of the Trust and/or at later dates.  For example, upon the death of the Grantor, the companion document, the Pour Over Will, is typically used to transfer the Grantor's remaining property (except joint property) into the Trust.

4.   The use of a Living Trust does not eliminate the need for a will.  A Grantor may have assets that he or she does not wish to transfer into the Living Trust.  For example, it may be preferable not to transfer some personal property such as vehicles, household and personal effects, and a personal checking account.  A Pour Over Will is useful to transfer such assets to the  trustee of the Living Trust for final distribution.  IT IS HIGHLY RECOMMENDED THAT A LIVING TRUST NOT BE SIGNED UNLESS A POUR OVER WILL IS ALSO PROPERLY SIGNED BY THE GRANTOR.

5.   The original copy of the Trust should be kept in a secure location such as a safe deposit box at a bank.  A photocopy should be given to the named Trustee if he or she is not the Grantor.  A third copy could be kept in the Grantor's home files.  The Grantor may wish to provide a copy to his or her attorney and/or to the person named as successor  trustee. However, before distributing such copies, the Grantor should consider that it may become awkward to later retrieve these copies if he or she should decide to change the designation of successor trustee.

6.   The trust includes provisions which reserve to the Grantor the right to revoke or amend the trust.  In order to do this, the Grantor must sign and deliver to the Trustee an appropriate written revocation or amendment.  If the trust is being changed, it may be easier to simply restate the trust by completing a new document.


 Pour Over Will

1.   This Pour Over Will should only be used in connection with a Living Trust or a Joint Living Trust.  The appropriate trust and the Pour Over Will should be signed at the same time.

2.   This Will does not dispose of property which passes on the death of the Willmaker to a person by operation of law or by any contract.  For example, the Will does not dispose of joint tenancy assets or the Willmaker's spouse's share of community property, and it does not normally apply to proceeds of life insurance on the Willmaker's life or to the Willmaker's retirement plan benefits.

3.   This Will is not designed to reduce taxes.  The tax results of the choices made in this Will should be discussed with a competent tax advisor.

4.   The Pour Over Will is not valid unless it is signed by a Willmaker who is of "sound mind" and of the minimum age for this state.  In most states, the minimum age is eighteen.  Some states permit an individual below the minimum age to execute a will if the person is married or in the military.  Being of "sound mind" requires that the Willmaker (a) know that he or she is executing a will, (b) know the general nature and extent of his or her property, and (c) know the descendants or other relatives that would ordinarily be expected to share in the estate.

5.   If the Willmaker is unable to sign due to physical disability, another person may be able to sign on behalf of the Willmaker, in the Willmaker's presence, and at the express direction of the Willmaker.  If there are any questions regarding the possibility of someone signing on behalf of the Willmaker, a lawyer should be contacted.

6.   The Pour Over Will should be signed by the Willmaker in the presence of three witnesses and a notary public. Witnesses to this will must be sixteen years of age or older.  Many states require only two witnesses, but the signature of a third witness provides some protection against the possibility that one of the witness' signature will be invalid for some reason.  For example, a person should not be a witness if that person is a beneficiary under the Will.  In most states, if a beneficiary's signature is counted in order to satisfy the minimum number of witnesses, then the will is not necessarily invalidated, but that "interested witness" may not receive a share of the estate any larger than if the Willmaker had died without a will.

7.   All of the witnesses must watch the Willmaker sign this Will.  The Willmaker should verbally declare that the document is intended to be his or her Last Will and Testament, but the witnesses need not read the Will or know of its contents.

8.   Each witness must sign his or her name with the Willmaker and the other witnesses present.  The witnesses should be satisfied that the Willmaker willingly signed the document as his or her free and voluntary act, and that the Willmaker was of full age and sound mind.

9.   The Willmaker should initial on the bottom margin of each page of the Will.  This is done to prevent the subsequent substitution of pages.

10.  The self-proving affidavit is a document which should be attached to the end of the Will, and which contains the testator's acknowledgment and the affidavit of the witnesses, made before a person authorized to take acknowledgments and administer oaths.  The affidavit recites that the requisite formalities were observed in executing the Will.  Although attaching the affidavit has nothing to do with the legality of the Will itself, it can speed the admission of the Will to  probate after the death of the Willmaker because it eliminates the need to have a witness appear at the probate proceeding to testify that the formalities in executing the Will were followed.  The witnesses may not be available later when they are needed.  A self-proved will may be admitted to probate without additional witnesses or affidavits, but it is still subject to contest on such grounds as undue influence, lack of testamentary capacity, or prior revocation.  In most cases, this affidavit should be executed and attached to the end of the Will.  Some states do not recognize the self-proving option: California, Maryland, Michigan, Ohio, Vermont, Wisconsin and Washington D.C.  Therefore, the affidavit will be of no use in those states.  However, including the affidavit in those states will not invalidate the Will.

11.  The date should be filled in wherever requested, using the date on which the actual signing takes place.  This step could become essential to the validity of the Will (for example, if this will revokes an earlier will).

12.  The number of total pages in the Will should be indicated, including the page(s) on which the witness signature lines appear.  The page with the affidavit, if included, should not be counted because the affidavit is not a part of the Will itself.

13.  The original copy of the Will should be kept in a secure location such as a safe deposit box at a bank, because only the signed original can be probated.  A second copy could be kept in the Willmaker's home files.  The Willmaker may wish to provide a copy to his or her attorney, or possibly to the person named as executor or  trustee. However, before distributing such copies, the Willmaker should consider that it may become awkward to retrieve them later, should the Willmaker decide to modify the Will and/or change the designation of executor or trustee.

14.  In most states, the Will cannot be changed by adding, deleting or modifying words on the face of the Will.  Such changes are usually disregarded.  The Will can be amended by executing a "codicil" to the Will, but this method is not recommended.  When changes are desired, it is recommended that the Will be revoked by executing a new will which expressly revokes the former will.  For example, if the Willmaker marries or divorces after the Will is signed, he or she should make and sign a new will.


 Personal Fact Sheet

 1.   The Personal Fact Sheet is not a legal document and does not require any signature, witnesses or notarization. It is merely a worksheet to document personal data and to organize the financial information of the Participant.

2.   The document should be stored in a location where the person who will become responsible for the affairs of the Participant would expect to find such information.  In addition to organizing financial matters, this document may be useful to the Participant's spouse or other family members if the Participant becomes incapacitated, or upon his or her death.  It contains the type of information needed if another person is required to manage the Participant's financial affairs, such as a conservator appointed by a court, or an agent of the Participant as designated under a Power of Attorney.  Also, this document contains the type of information that a lawyer or an executor would need for the administration of an estate.

3.   The document should be reviewed and updated at least annually in order to reflect additions or changes to the information contained in it.


 Memorial Services

 The Memorial Services document is not legally binding. However, it should be signed by the Declarant in order to memorialize his or her stated intentions.  The document should be placed in a location that is safe and secure, but one where it will be quickly accessible by close family or friends so that the Declarant's wishes regarding the disposition of the body, memorial services, and arrangements to be made, can be quickly determined.  The Declarant should also consider discussing these plans with his or her family. Finally, a copy of the document should be provided to any funeral director with whom arrangements have been made.  If any prepayments were made for such services, proof of purchase receipts should be attached to this document.


 Premarital Agreement

 1.   The Premarital Agreement should be signed prior to the wedding ceremony because the consideration (value) for entering into the agreement is the act of marriage itself. The document should be signed in the presence of a notary public so that the agreement can be recorded in the public records.  A few states -- North Dakota, Ohio and South Carolina -- require that the Agreement be signed in the presence of witnesses.

2.   The exhibit describing the financial position of each person should be signed by the person whose assets are described.  The person who receives the exhibit should initial the exhibit in order to acknowledge receipt.

3.   One signed copy of the Agreement should be retained in a secure place within the residence of the parties.  Each spouse should also place a copy in a secure place outside of the home.  For example, a copy could be given to each spouse's personal attorney or placed in that spouse's personal safe deposit box.


 Bad Check Notice

 1.   The Bad Check Notice letter should be signed by the check payee at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   A photocopy, but not the original copy, of the returned check may be enclosed with the letter.  The writer should keep a copy of all correspondence to and from the Drawer, and should maintain a written summary of all telephone conversations.


Credit
 Credit Card Inquiry

 1.   The Credit Card Inquiry letter should be signed by the Cardholder at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   If it is believed that the credit card statement contains an error, or if more information is needed about a certain transaction which appears on the statement, these inquiries should be addressed in the letter, rather than marking up the original copy of the statement itself. However, it may also be helpful to enclose a photocopy of the credit card statement with the suspect transaction highlighted or underlined.

3.   The credit card company should receive the written inquiry no later than 60 days after that Issuer sent the statement which contained the error.

4.   The letter should be sent by certified mail, with a return receipt requested, in order to document the fact that the card issuer received the letter.

5.   If this letter is a follow-up to an earlier letter, a photocopy of the previous correspondence should be attached.


 Bill of Sale Motor Vehicle

 1.   The Bill of Sale Motor Vehicle document should be signed by both the Buyer(s) and the Seller(s).  The Buyer(s) should sign in the Odometer Certification section, and the Seller(s) should sign at the end of the document.  It is not necessary that the signatures be witnessed or notarized. The sale becomes effective as of the date provided in the text of the document.

2.   Note: This document only represents the transfer of the RIGHT to ownership of the vehicle; the motor vehicle's Certificate of Title represents ACTUAL ownership. Therefore, this document and the Certificate of Title are needed to complete the transfer of the motor vehicle.

3.   The original copy of the Bill of Sale should be given to the Buyer.  The Seller should retain a copy.

4.   The Buyer(s) should be certain to obtain appropriate insurance coverage for the vehicle.


 Work for Hire Agreement

 1.   The Work for Hire Agreement should be signed by both parties and becomes effective as of the date specified in the Agreement.  It is not necessary that the signatures be witnessed or notarized.

2.   The Work for Hire Agreement should only be used for a party who is an "independent contractor" with respect to the Company.  If instead, the arrangement between the Company and the service provider conforms more closely to the characteristics of an employee/employer relationship, the Employment Agreement may be more appropriate.

3.   It is advisable to sign two copies of the Agreement so that each party will have a copy with original signatures. Original copies should be kept in a fire-proof and safe location.

4.   An attorney should be consulted regarding any issues not addressed by this program.


 Child Care Authorization

 1.   The Child Care Authorization document should be signed, but it is not necessary that the signature be witnessed or notarized.

2.   The parent or legal guardian should provide the original copy of the Authorization to the caretaker and retain one copy.


 Letter to School

 1.   The Letter to School should be signed by the writer at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2.   The Letter to School document does not grant any specific authority to the school who will receive the document.  It is effective merely to provide notice to school officials regarding the identity of the caretaker(s) and the scope of the authority already granted to those caretaker(s).


 Child Care Instructions

 1.   The Child Care Instructions document does not grant any specific authority to the caretaker who will receive the document.  (This program's Child Care Authorization may be appropriate for that purpose).  The document merely provides helpful information for use by a temporary caretaker. Therefore, the document does not require any signature, witnesses or notarization.

2.   The original copy of the document should be provided to the caretaker and the contents should be discussed orally. A copy of the Instructions should be retained by the parent or legal guardian.


 Revocation of Living Will

 1.   Although a Living Will may be effectively revoked under a variety of methods, it is recommended that this formal, written revocation be used.  The Revocation of Living Will ("Revocation") should be signed and dated by the person making the revocation.  If the Revocation is being executed by a resident of New Hampshire, New Mexico, Mississippi or Vermont, one or more disinterested witnesses must sign the Revocation.  In other states, even though witnesses may not be technically required, the use of a witness formalizes the document and provides added assurance that the Revocation will be recognized.

2.   The Revocation is not enforceable or effective until the Declarant's attending physician has been notified of the revocation.  Therefore, a copy of the Revocation must be provided to the Declarant's attending physician or to someone who will deliver it to the Declarant's health care provider.

3.   Because the attending physician or health care provider must receive notice of the Revocation, it is recommended that the Revocation be mailed by certified mail to the provider's last known address.  Alternatively, a copy of the Revocation may be hand-delivered to the provider, in which case the provider should sign the document acknowledging receipt of the Revocation.  If the Declarant is a patient in a health care institution, a copy of the Revocation should be placed in the Declarant's medical chart.  In Mississippi, the Revocation should be filed with the Mississippi Bureau of Vital Statistics of the State Board of Health.

4.   The Revocation will no longer be valid or relevant if another Living Will is executed, dated subsequent to the date of the Revocation.  This is because the new Living Will automatically supersedes any prior Living Wills and, also, in turn, supersedes any revocations of those prior Living Wills.


 Living Will

 1.   CAUTION: The Living Will may not be valid in the Declarant's state of residence unless that state was selected in the program.  An attorney should be consulted if there is any uncertainty regarding which state's document to use.

2.   The Declarant must be 18 years old and mentally competent in order to execute a Living Will.  The Living Will must be signed and dated in order to be effective. Witness requirements must be reviewed before executing the Living Will.  If the Declarant's signature on the Living Will is not witnessed in the proper manner, the Living Will may not be enforceable.  Further, some states require that the selections regarding the use of artificial nutrition and hydration and/or other matters be separately initialed or signed.

3.   A few states require that the signatures of the Declarant and the witnesses be notarized.  If that is the case for the state that was selected, a provision will appear at the bottom of the Living Will for such notarization.  The Declarant should carefully review the document to make sure that other required signatures or initial lines are completed as required.

4.   Each state has restrictions on who may be a witness. In general, persons should not be used as witnesses if they are relatives of the Declarant by blood, marriage, or adoption, or who may become directly involved in providing health care to the Declarant, or if they are an employee of a health care provider attending the Declarant on the date of the declaration, or any individual who is less than 18 years of age.

5.   The Declarant should keep a copy of the Living Will after signing it.  One copy should be given to each health care provider and a copy should be given to appropriate family members.  An indication should be made on the document itself regarding who has received a copy, in case there is a need for later retrieval, modification or revocation.

6.   Before signing this document, the Declarant should be completely comfortable that he or she understands the nature and range of decisions that may be made on the Declarant's behalf.  The Declarant should discuss the range of medical decisions with a physician, health care provider, social worker, pastor, or an attorney -- someone who is knowledgeable about these issues and can answer questions.

7.   If the Declarant learns that he or she has a terminal condition after signing a Living Will, he or she should execute a new Living Will in order to re-emphasize his or her informed decision with regard to his or her preferences.


 Health Care Power of Attorney

 1.   CAUTION: The Health Care Power of Attorney may not be valid in the Principal's state of residence unless that state was selected in the program.  An attorney should be consulted if there is any uncertainty regarding which state's document to use.

2.   The Principal must be 18 years old and mentally competent in order to execute a Health Care Power of Attorney.  The Power of Attorney must be signed and dated in the presence of witnesses.  Certain individuals are prohibited from being witnesses, depending upon state law, and they must be 18 years of age.  Some states require notarization of the document.

3.   The Principal should inform the person named as Health Care Agent of the designation and obtain his or her consent. The Principal should discuss the scope of the Health Care Power of Attorney with the designated Agent, expressing the Principal's wishes, values and preferences regarding health care.  Certain persons are prohibited from serving as the Health Care Agent; the health care provider and such provider's employees may not serve, unless that person is related to the Principal.  Some states require that the designated agent must accept the designation by signing the form.  Some states require that a "patient advocate" in a skilled nursing facility witness the signing of this document if the Principal is a patient in such facility. The Principal may wish to consult with an attorney to determine whether there have been any recent changes to state laws regarding execution and implementation of the document.

4.   The Principal should keep the signed, original document with his or her personal papers.  Copies should be provided to the person named as Health Care Agent, to appropriate family members, and to health care providers.  An indication should be made on the document itself (or in the optional "Safekeeping" section of this program) regarding who has received a copy, in case there is a need for later retrieval, modification or revocation.

5.   If a Living Will has been signed as a separate document, and if the Health Care Power of Attorney does not specifically refer to such Living Will, the Principal should be sure that any directives contained in the Health Care Power of Attorney, especially as they relate to life-sustaining procedures, are consistent with those contained in the Living Will.


 Joint Living Trust

 1.   The Joint Living Trust should be signed by both Grantors and by the Trustee(s).  It is recommended that these signatures be notarized.  However, unlike the Simple Will, no witnesses are necessary.

2.   The date should be filled in on the first page of the document.

3.   After signing the Joint Living Trust document and creating the trust, the next step which must be taken is to legally transfer specific assets into the Trust.  The trust provisions will only apply to assets that have been placed into the Trust.  Assets can be transferred at the time of the creation of the Trust and/or at later dates.  For example, upon the death of the Grantor, the companion document, the Pour Over Will, is typically used to transfer the Grantor's remaining property (except joint property) into the Trust.

4.   The use of a Joint Living Trust does not eliminate the need for a will.  The Grantors may have assets that they do not wish to transfer into the Joint Living Trust.  For example, it may be preferable not to transfer some personal property such as vehicles, household and personal effects, and a personal checking account.  A Pour Over Will is useful to transfer such assets to the trustee of the Joint Living Trust for final distribution.  IT IS HIGHLY RECOMMENDED THAT A JOINT LIVING TRUST NOT BE SIGNED UNLESS A POUR OVER WILL IS ALSO PROPERLY SIGNED BY EACH GRANTOR.

5.   The original copy of the trust should be kept in a secure location such as a safe deposit box at a bank.  A photocopy should be given to the named Trustee(s) if he or she or they is/are not the Grantor(s).  A third copy could be kept in the Grantors' home files.  The Grantors may wish to provide a copy to their attorney and/or to the person named as successor trustee.  However, before distributing such copies, the Grantors should consider that it may become awkward to later retrieve these copies if they decide to change the designation of successor trustee.

6.   The trust includes provisions which reserve to the Grantors the right to revoke or amend the trust.  In order to do this, the Grantors must sign and deliver to the trustee an appropriate written revocation or amendment.  If the trust is being changed, it may be easier to simply restate the trust by completing a new document.


 Advance Health Care Directive

 1.   CAUTION:  The states of CALIFORNIA, OREGON, RHODE ISLAND and WISCONSIN require the use of their respective state specific forms. These forms are offered as part of Family Lawyer's "Living Will" and "Health Care Power of Attorney" documents.  In addition, the states of NEVADA, NEW HAMPSHIRE, OHIO, SOUTH CAROLINA, TENNESSEE, TEXAS and VERMONT have unique statutory requirements regarding the form of the medical directives.  The NORTH DAKOTA statute provides that the form provided in its statute is the "preferred" form.

2.   KENTUCKY, OKLAHOMA, OREGON and VIRGINIA have adopted specific advance directive forms.  These state specific documents provide for the correct witnessing procedure based on the state entered as the Declarant's address.

3.   The Declarant must be 18 years old and mentally competent in order to execute a Directive.  The Directive must be signed and dated in order to be effective.  Witness requirements must be complied with when executing the Directive.  If the Declarant's signature on the Directive is not witnessed in the proper manner, the Directive may not be enforceable.

4.   In general, persons should not be used as witnesses if they are less than 18 years of age, are appointed as the health care agent or alternate health care agent, or are relatives of the Declarant by blood, marriage, or adoption. If an individual may become directly involved in providing health care to the Declarant, or is an employee of a health care provider attending the Declarant on the date of the declaration, such person should not be a witness.

5.   The Declarant should keep a copy of the Directive after signing it. One copy should be given to each health care provider, a copy to appropriate family members, and a copy to the person named as the Agent, if one is appointed in this document.  An indication should be made on the document itself regarding who has received a copy, in case there is a need for later retrieval, modification or revocation.

6.   Before signing this document, the Declarant should be completely comfortable that he or she understands the nature and range of decisions that may be made on the Declarant's behalf.  The Declarant should discuss the range of medical decisions with a physician, health care provider, social worker, pastor, or an attorney -- someone who is knowledgeable about these issues and can answer questions.

7.   If the Declarant learns that he or she has a terminal condition after signing a Directive, he or she should execute a new Directive to re-emphasize his or her informed decision with regard to his or her preferences.

8.   The Advance Directive should be reviewed at the time it is signed to make sure any required initials, dates, and signatures have been completed.


 Revocation of Advance Directive

 1.   Although an Advance Health Care Directive ("Advance Directive") may be effectively revoked under a variety of methods, it is recommended that this formal, written revocation be used.  The Revocation of an Advance Directive ("Revocation") should be signed and dated by the person making the Revocation.  If the Revocation is being executed by a resident of New Hampshire, New Mexico, Mississippi, Vermont or Wyoming, one or more disinterested witnesses must sign the Revocation.  In other states, even though witnesses may not be technically required, the use of a witness formalizes the document and provides added assurance that the Revocation will be recognized.

2.   The Revocation is not enforceable or effective until the Principal's attending physician has been notified of the Revocation.  Therefore, a copy of the Revocation must be provided to the Principal's attending physician or to someone who will deliver it to the Principal's health care provider.

3.   Because the attending physician or health care provider must receive notice of the Revocation, it is recommended that the Revocation be mailed by certified mail to the provider's last known address.  Alternatively, a copy of the Revocation may be hand-delivered to the provider, in which case the provider should sign the document acknowledging receipt of the Revocation.  If the Principal is a patient in a health care institution, a copy of the Revocation should be placed in the Principal's medical chart.

4.   The Revocation will no longer be valid or relevant if another Advance Directive is executed and dated subsequent to the date of the Revocation.  This is because the new Advance Directive automatically supersedes any prior Advance Directive and, also, in turn, supersedes any revocations of those prior Advance Directives.


 Revocation of Health Care Power of Attorney

 1.   Although a Health Care Power of Attorney may be effectively revoked under a variety of methods, it is recommended that this formal, written revocation be used. The Revocation of Health Care Power of Attorney ("Revocation") should be signed and dated by the person making the revocation.  If the Revocation is being executed by a resident of Wyoming, at least one disinterested person must witness the Revocation.  In other states, even though witnesses may not be technically required, the use of a witness formalizes the document and provides added assurance that the Revocation will be recognized.

2.   The Revocation is not enforceable or effective until the Principal's attending physician has been notified of the revocation.  Therefore, a copy of the Revocation must be provided to the Principal's attending physician or to someone who will deliver it to the Principal's health care provider.

3.   Because the attending physician or health care provider must receive notice of the Revocation, it is recommended that the Revocation be mailed by certified mail to the provider's last known address.  Alternatively, a copy of the Revocation may be hand-delivered to the provider, in which case the provider should sign the document acknowledging receipt of the Revocation.  If the Principal is a patient in a health care institution, a copy of the Revocation should be placed in the Principal's medical chart.

4.   The Revocation will no longer be valid or relevant if another Health Care Power of Attorney is executed, dated subsequent to the date of the Revocation.  This is because the new Power of Attorney automatically supersedes any prior Powers of Attorney and, also, in turn, supersedes any revocations of those prior Powers of Attorney.


 Receipt

 1.   The General Receipt should be signed and dated by the party who is receiving the money, document or other property.  It is not necessary that the signature be witnessed or notarized.

2.   The General Receipt is not effective to transfer legal ownership of the property.  The Receipt merely provides evidence that the recipient has obtained possession of the property.  (If legal ownership is to be transferred, the Bill of Sale document may be appropriate.)

3.   The original copy of the Receipt should be given to the person who is transferring the money, document or other property.  A copy of the receipt should be retained by the recipient of the property.


 Exhibits

 1.   The Exhibit document is used to supplement other documents because it contains information which may be lengthy or, for whatever reason, is better handled as a separate page which is attached to the main document. Therefore, it is usually not appropriate or necessary to sign the Exhibit.

2.   The exception to this general rule is where the recipient of the information seeks to rely upon the Declarant's representations made in the Exhibit.  An example is where a Declarant provides financial information to a lender in an exhibit.  In that case, the recipient may require that the Declarant sign the end of the document as certification that the information is accurate.


Non-Compete Agreement

 1. 	The Non-Compete Agreement should be signed by both parties (the "Protected Party" and the "Non-Competing Party"), and becomes effective as of the date specified in the Agreement.  It is not necessary that the signatures be witnessed or notarized.

2. 	It is advisable to sign two copies of the Agreement so that each party will have a copy with original signatures. Original copies should be kept in a fire-proof and safe location.

3. 	An attorney should be consulted regarding any questions about the non-compete and non-solicitation covenants that are included in this Agreement, or regarding any issues not addressed by this program.

4. 	The Agreement will terminate in accordance with the time period(s) established for the covenants in the Agreement, or earlier by the mutual agreement of both parties.  Any such mutual termination should be made in writing and signed by both parties.


Authorization for Transfer of Medical Information

 1.  The authorization to release medical information must be signed in two places by the patient.  The first signature block pertains to specially protected medical information such as substance abuse treatment, mental health treatment or HIV/AIDS-related information.  The second signature block relates to the entire form.

2.  A guardian or other person serving in a representative capacity may sign the consent for a minor or a person who is incompetent.

3.  The patient should keep one copy of the Authorization and provide one copy to the health care provider to be kept in the patient's medical file folder.

4.  THIS PROGRAM'S TRANSFER OF MEDICAL RECORDS IS NOT INTENDED TO BE USED FOR THE RELEASE OF MEDICAL RECORDS FOR LITIGATION PURPOSES, OR FOR THE RELEASE OF INFORMATION TO A THIRD PARTY PAYOR.  An attorney should be contacted if such a release is needed.


Stop Payment on Check Letter

 1. 	The Stop Payment on Check letter should be signed by the writer at the end of the letter.  A copy of the letter should be retained by the writer for his or her records.

2. 	If the stop payment order relates to a check drawn on a joint account, both co-owners may sign, but it is not necessary.  The signature of either owner is sufficient.

3. 	If the stop payment order relates to a check drawn on the account of a deceased person, any person "interested" in the account (i.e. a beneficiary or family member) may sign the letter.

4. 	It is not necessary that the signature(s) be witnessed or notarized.


Small Claims Worksheet

 1. 	The Small Claims Worksheet is not a legal document and does not require any signature, witnesses or notarization.

2. 	The Worksheet is an organizational and educational tool for using the small claims court.  After completing this worksheet, if there is uncertainty about whether small claims court is appropriate for a specific claim, an attorney should be consulted.  This worksheet should be provided to that attorney, who will review the information and offer advice regarding how to proceed.


Refusal to Donate

 1. 	 All of the signature lines on the "Refusal to Donate Form" should be completed.  Depending on the Nondonor's selections, the Form will be signed by the Nondonor, the Nondonor's representative, or the Nondonor's parents or guardians.  The Nondonor should indicate the date the Form is signed.  The Nondonor should carefully review the Form to assure that all required signatures have been obtained.

2. 	Witnesses must be present when the Form is signed by the Nondonor and then the witnesses should sign where indicated on the Form.

3. 	The Nondonor should tell family members and/or close friends about the Form and the Nondonor's wishes concerning organ donation.

4. 	The Nondonor may wish to give a copy of the Form to any individual or institution willing to keep a copy of the Form, such as a family physician or local hospital.

5. 	If this Form is later revoked or amended, the Nondonor should notify the appropriate parties who received a copy of the Form. The Nondonor should then carry the revocation and any new Form in a wallet.


Organ Donation Form

1. 	IMPORTANT: The Donor must initial the following sections of the form after it has been printed.

* Designation of Organs

* Designation of Use

* Designation of Donee (if selected by the Donor)

2. 	All of the signature blanks on the Organ Donation Form should be completed.  Depending upon the Donor's selections, the Form should be signed by the Donor, the Donor's representative, or the Donor's parents or guardians.  The Donor should indicate the date the Form is signed.  The Donor should carefully review the Form to assure that all required signatures are obtained.

3. 	Witnesses must be present when the Form is signed by the Donor and then the witnesses should sign where indicated on the Form.

4. 	The Donor should tell family members and/or close friends about the existence of the Form and the Donor's wishes concerning organ donation.

5. 	The Donor may wish to give a copy of the Form to donees designated on the Form to receive the Donor's organs and tissues at the Donor's death.  A copy may also be given to any other individual or institution willing to keep a copy of the Form, such as a family physician or local hospital.

6. 	If this Form is later revoked or amended, the Donor should notify the appropriate parties who received a copy of the Form.  The Donor should then carry the revocation and any new Form in a wallet.


Organ Donation Form

1. 	All of the signature blanks on the Organ Donation Form should be completed.  Depending on the Donor's selections, the form should be signed by the Donor, the Donor's representative, or the Donor's parents or guardians.  The Donor should indicate the date the form is signed.  The Donor should carefully review the form to assure all required signatures are obtained.

2. 	Witnesses should be present when the form is signed and should then sign where indicated on the form.

3. 	The Donor should tell family members or close friends about the form and the Donor's wishes concerning organ donation.

4. 	The Donor may give a copy of the form to any donee designated on the form to receive the Donor's organs and tissues at the Donor's death.  A copy may also be given to any other individual or institution willing to keep a copy of the form such as a family physician or local hospital.

5. 	If this form is later revoked or amended, the Donor should communicate that revocation or amendment to whoever has received a copy of this form.  The Donor should then carry the revocation and any new form in a wallet.


 Oklahoma Advance Health Care Directive

 1.   OKLAHOMA has adopted a specific advance directive form. The Oklahoma form requires that the life support, coma, nutrition and proxy sections each be signed by the Declarant at the time the document is executed.

2.   The Declarant must be 18 years old and mentally competent in order to execute a Directive.  The Directive must be signed and dated in order to be effective.  Witness requirements must be complied with when executing the Directive.  If the Declarant's signature on the Directive is not witnessed in the proper manner, the Directive may not be enforceable.

3.   In general, persons should not be used as witnesses if they are less than 18 years of age, are appointed as the health care proxy or alternate health care proxy, or are relatives of the Declarant by blood, marriage, or adoption. If an individual may become directly involved in providing health care to the Declarant, or is an employee of a health care provider attending the Declarant on the date of the declaration, such person should not be a witness.

4.   The Declarant should keep a copy of the Directive after signing it. One copy should be given to each health care provider, a copy to appropriate family members, and a copy to the person named as the Proxy, if one is appointed in this document.  An indication should be made on the document itself regarding who has received a copy, in case there is a need for later retrieval, modification or revocation.

5.   Before signing this document, the Declarant should be completely comfortable that he or she understands the nature and range of decisions that may be made on the Declarant's behalf.  The Declarant should discuss the range of medical decisions with a physician, health care provider, social worker, pastor, or an attorney -- someone who is knowledgeable about these issues and can answer questions.

6.   If the Declarant learns that he or she has a terminal condition after signing a Directive, he or she should execute a new Directive to re-emphasize his or her informed decision with regard to his or her preferences.


 Oregon Advance Health Care Directive

 1.   OREGON has adopted a specific advance directive form. The OREGON advance directive contains several instructions which either need to be signed or initialed by the Declarant at the time the document is signed.  The Health Care Representative designated by the Declarant must also sign the document, indicating acceptance of such appointment.

2.   The Declarant must be 18 years old and mentally competent in order to execute a Directive.  The Directive must be signed and dated in order to be effective.  Witness requirements must be complied with when executing the Directive.  If the Declarant's signature on the Directive is not witnessed in the proper manner, the Directive may not be enforceable.

3.   In general, persons should not be used as witnesses if they are less than 18 years of age, are appointed as the health care representative or alternate health care representative, or are relatives of the Declarant by blood, marriage, or adoption.  If an individual may become directly involved in providing health care to the Declarant, or is an employee of a health care provider attending the Declarant on the date of the declaration, such person should not be a witness.

4.   The Declarant should keep a copy of the Directive after signing it. One copy should be given to each health care provider, a copy to appropriate family members, and a copy to the person named as the health care representative, if one is appointed in this document.  An indication should be made on the document itself regarding who has received a copy, in case there is a need for later retrieval, modification or revocation.

5.   Before signing this document, the Declarant should be completely comfortable that he or she understands the nature and range of decisions that may be made on the Declarant's behalf.  The Declarant should discuss the range of medical decisions with a physician, health care provider, social worker, pastor, or an attorney -- someone who is knowledgeable about these issues and can answer questions.

6.   If the Declarant learns that he or she has a terminal condition after signing a Directive, he or she should execute a new Directive to re-emphasize his or her informed decision with regard to his or her preferences.