In the previous article you read about guardianships and conservatorships and how they are set up after a person is deemed incapacitated.  Both of these appointments are unnecessary if you plan now for the possibility of becoming incompetent later in life.  There are effective and inexpensive planning tools at your disposal that you can put in place to today to work for you tomorrow. 

The First Tool:  Durable Power of Attorney

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Question 1:  What is a guardianship?

In the event your loved one becomes mentally or physically incapacitated, a guardianship is a process that involves an individual going to probate court and appearing before a judge to become such person’s guardian.  If the court determines the loved one is indeed incapacitated based on evidence from the hearing, the court will decide whether the person seeking the role of guardian is suitable and responsible to act in such position.

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by Bob Kelleher, Minnesota Public Radio

St. Paul, Minn. — An ambitious plan to connect police and other critical service providers by broadband across northeast Minnesota is getting more than $43 million in federal funding.

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For many people at or over retirement age, the thought of needing nursing facility care is overwhelming and down right scary.  Much of the negative emotion and fear come from a lack of information and understanding of the process as well as improper planning.  Below are a few commonly-asked questions and answers to make things a little less fuzzy:

Question 1:  What is Medical Assistance and what does it cover?

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Voters in St. Louis County will head to the polls Tuesday for a special election that will determine the fate of the St. Louis County School District. The district will ask area voters to approve a yearly property tax hike. This would increase a resident’s property tax by approximately $250, for home with a value of $150,000. The monies generated, which would be approximately $80 million, would primarily be used for new construction and repairs to the aged district facilities. 

St. Louis County School District is the state’s largest district and encompasses acreage comparable to the State of Connecticut.  There are currently seven schools in the district, located in the communities of Cook, Orr, Babbitt, Tower, Cherry, Cotton, and Albrook. Overall, the district has lost approximately 800 students in the past decade. The area has been plagued with declining enrollment, that couple with the fact that students in the district have transferred to neighboring districts, has left the County district nearly insolvent.  A new course is necessary.

The question is whether this referendum would achieve overall long-term stability. Are new County schools or buildings really the answer? Perhaps, the look of education in northern Minnesota needs to change. Not only is the County district struggling, but area independent school districts are struggling as well. Clearly, our overall educational system is under immense financial pressure and a band aid won’t correct this problem.  If the vote fails, it is critical that the 19 districts bordering the St. Louis County district, work together to revitalize our areas schools.  This is a tremendous opportunity for the area. One that should be viewed with optimism and hope. 

When you sit down to prepare your will, what will be on your mind? In the past 20 years, there has been a continuous increase in contested estates. We have all seen or heard stories where brothers and sisters are wrestling to control the assets of their deceased parents. Perhaps, we are generally a more litigious society, nevertheless there has been an increase in the volume of wealth transfers, i.e. there is more to fight over.

Your number one goal will likely be to keep your family intact, avoid damaging the relationships between your children. Here are some steps to minimize the chance that your will might trigger a family legal dispute:

1.       Pick the right executor and trustees. Anticipate family friction and make sure you don’t appoint to key positions relatives who can’t get along.

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The $8,000 for new home buyers will be extended. Since January the US Government has been offering a $8,000 tax credit for new home buyers.  The credit is  set to expire at the end of this month.  If appears likely that the Congress will decided to lengthen and extend the credit to even non-first time home buyers. The House will vote on the bill on Thursday.

Buyers who have owned a home for under 5 years may be eligible for the credit, up to $6,500, or the full amount. New home buyers (or anyone who purchased within the past three years) may be eligible for the $8,000 dollar credit. “This is probably the last extension,” said Sen. Johnny Isakson, R-Ga.  Roughly 1.4 million have qualified for the first-time homeowner credit through the month of August.

The credit is available on homes under $800,000, and vacation homes do qualify. Another stipulation of the credit is that individual incomes above $125,000 will be phased out. Another good note for military personal serving overseas, the credit is extended for more than a year, until June 30th of 2011.

• Extends 8000 first time buyer credit to June 30th, 2010.
• 6500 for buyers who owned their home at least 5 years.
• Income cap is raised to $250,000 for joint incomes.

The debate over whether Minnesota will allow copper nickel mining has intensified this week. On Wednesday, the state’s Department of Natural Resources (DNR) and the U.S. Army Corps of Engineers released the long-awaited environmental review of the proposed PolyMet copper mine project. Let’s recap how the project got started, the scope of the project, and the governmental process.

In 2005, Polymet Corporation purchased assets of the bankrupt iron-ore LTV mining Corporation, which was located near Hoyt Lakes in northeastern Minnesota. The land and facility is part of the Duluth complex, which contains the world’s largest undeveloped deposits of non-ferrous metals. The deposits, which were discovered in the 1940’s, are now economically viable. In the 1990’s, a hydrometallurgical process for recovering copper, nickel, cobalt, platinum, palladium, and gold from rock became commercially viable.  These metals are typically used in construction, plumbing, electrical wiring, batteries, cell phones, aircraft engines, medical treatments, electronics and more.

In 2005, Polymet began the process to receive the required permits to mine copper nickel. The Minnesota Environmental Policy Act (MEPA) requires that an environmental impact statement (EIS) be conducted for all new mining operations. The DNR is usually the responsible government unit for producing the statement; however, the federal government can also be involved depending on the specific conditions of the proposed project (land ownership, wetland, etc.). The proposed Polymet project raises several different environmental concerns then projects associated with taconite or ferrous mining. This has increased the complexity of the environmental review process.

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Property values across the U.S., including Minnesota (and Minnesota lakeshore) have been declining.  So, of course, one would expect their property taxes will decrease next year as well.  Sadly, a decrease in your property taxes is unlikely to happen.  In order to understand why, we have to take a look at how the property tax system in Minnesota works.

Unlike income and sales taxes, which are rate-based taxes, Minnesota's property tax does not work this way.  Rather, property tax is a levy based tax.  This means that taxing districts, such as cities, counties, school districts and special taxing districts, determine how much money they will need to raise in property taxes in order to balance their budget.  The “levy” amount is then used to determine the tax rate which is to be applied to local property.  Therefore, a change in the value of local taxable property will affect the distribution of what each property’s share is, but will not likely affect total revenues generated by the state. 

Given this levy-based system, there are three basic factors that will determine an individual parcel’s property tax liability: (1) your local levy, the rate your local taxing district(s) decide to impose on property, (2) your parcel’s share to total property tax base, this valuation includes estimated market values, the portion of the value which is taxable, and the class rate (statutorily set), and (3) applicable tax credits, credit amounts which are subtracted from the tax liability.

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  It is the end of another long week of meetings, traffic, deadlines, and stress.  You leave work and set off into the night.  The closer you get to your private hideaway, the faster your troubles seem to fade away.  There is no better medicine for your worries. 

The weekend is filled with laughter, relaxation, and family fun. The hideaway has become a multigenerational meeting place where grandparents, adult children and their spouses, and grandchildren come to play.   Perhaps it is a cabin located on Lake Vermilion, Burntside, or Pokegama.  No matter where your destination is, there sense peace and happiness.

Your goal is to pass this property on to your family. Perhaps, for both nostalgic and financial reasons, you want to keep this vacation home in the family for future generations.  However, passing on a cabin without a proper succession plan can cause unintended consequences.  For example, consider if your three children inherit your cabin outright, all three are listed on the deed.  As life often does, it may throw in a curve ball.  Perhaps, one child loses her job, can't afford her share of maintenance costs and want to sell out her share.  But, the other children are not financially in a position to buy her out.  Therefore, the distressed daughter is forced to ask the court to "partition" the cabin.  Other words, sell the family hideaway.

This is just a small example of the undesirable outcomes of inheriting or passing on property outright to your children.  This outright transfer creates "tenants in common," which refers to arrangements under which two or more people co-own a parcel of real estate without a right of survivorship. This type of co-ownership allows each co-owner to choose who will inherit his/her ownership interest upon death.    In addition, each owner can also individually sell their interest in the property. 

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