The 2018 Session of the General Assembly was especially busy this year. It dealt with over 3000 bills, many of which were politically charged. This is the second of a two-part LinkedIn series that was put together to review the bills that were enacted that affected various estate planning issues. In the first part, bills that related to estate and tax planning issues were presented. In this part, bills that address guardianship matters, disability planning, and probate will be reviewed.
The alphanumeric numbers in parentheses are the bills numbers in the Maryland Senate (SB) or House of Delegates (HB). When bills were introduced into both chambers, both bill numbers are given. Also, the effective date for each bill has been inserted at the end of each description.
GUARDIANSHIP AND DISABILITY:
There were a number of bills passed this year to add strength and flexibility to our existing guardianship provisions, and expand the rights of both the disabled person and the individuals related to that disabled person.
- Voluntary Admission to Mental Facility (HB33). Under this amendment to current law, a disabled person who has a treatable mental disorder, but otherwise has capacity, may self-admit to a mental facility, provided that the disabled person (i) understands the request for admission; (ii) is able to give continuous assent to retention by the mental facility; and, (iii) is able to ask for release. (Effective 10/1/2018)
- Appointment or Designation of Standby Guardian – Adverse Immigration Action (HB1613/SB1239). If a parent of a minor child is subject to an adverse immigration action, such as an arrest for an alleged violation of federal immigration law or detention by the Department of Homeland Security, then the parent can provide a written designation of a standby guardian to care for the minor child, whom the courts must appoint. (Effective 5/15/18)
- Petition for Visitation (HB1483). Across the country, there have been many cases where a disabled family member is isolated from other members of the family. Not surprisingly, the most well-known cases involved celebrities such as Casey Kasem, Glen Campbell and Mickey Rooney. Under this new law, Maryland now allows certain persons, such as a spouse, adult children and grandchildren, and parents or siblings of a disabled person to petition a court to require a guardian to allow visitation by these family members under such terms and conditions as the court determines to be appropriate. (Effective 10/1/2018)
- Maryland ABLE Program – Modifications (HB782/SB550). It will now be possible to transfer funds from qualified tuitions plans such as a 529 Plan or the Maryland Prepaid College Trust, subject to certain maximum limitations established under federal law that was established for educational purposes to an ABLE Account (Achieving a Better Life Experience) for the benefit of a disabled beneficiary. Upon the death of the account owner, the funds in an ABLE account can be paid over to the beneficiary’s estate or to another ABLE account, without set off for any possible claims for Medicaid reimbursement. (Effective 6/1/2018)
- Maryland Uniform Transfers to Minors Act – Award of Reasonable and Necessary Expenses (HB769). A provision has been added to the UTMA statute that authorizes a court, at any time during a proceeding related to an UTMA account, to award to either party the costs associated with a lawsuit including court costs and attorneys’ fees, in amount that the court determines necessary for the prosecution or the defense of a lawsuit. The court may also order a party who brings or defends a proceeding without substantial justification to reimburse the prevailing party for any necessary expenses for presenting or defending the proceeding. (Effective (10/1/2018)
- Administration of Estates – Waiver of Fees (HB556/SB466). This bill addresses impoverished estates that contain only real estate that is valued less than the outstanding mortgage or lien held against that real estate. Often in these cases, the estate cannot afford to pay the applicable probate fees. Probate estates are subject to the payment of probate fees, depending on the size of the probate estate. This bill allows the Register of Wills to waive the probate fee in an estate if (i) the real property within the estate is transferred to an heir who actually resides on the property, or (ii) there is a lien against the property and the property is subject to a tax property sale. In either case, there must be a demonstration that the estate is unable to pay the fees due to impoverishment. (Effective 10/1/2018)
- Administration Exemption – Transfer of Motor Vehicle and Boat Titles (SB292). Often, upon the death of one spouse, the only asset in the estate of that spouse is a motor vehicle or a boat. This bill allows a surviving spouse to transfer up to two motor vehicles or a motor vehicle and/or a boat if the spouse: (i) certifies that all debts and taxes owed by the decedent spouse have been paid; (ii) the state is satisfied that the value of the motor vehicle or boat is less than $5000; and, (iii) the state is provided a copy of the death certificate and proof of marriage. (Effective 10/1/2018)
Finally, there were two bills that are really tangential to estate planning, but are nevertheless important.
- Organ and Tissue Donation Awareness Fund – Donor Registry (SB292). Maryland’s Secretary of Health has selected Donate Life Maryland, a private nonprofit, to establish, maintain and operate a donor registry for organ, tissue and eye donations. This bill requires the Secretary to distribute at least $400,000 to this private nonprofit in support its efforts. (Effective 10/1/2018)
- Maryland Uniform Real Estate Electronic Recording Act (HB1093). This bill provides that if a law requires that a document be original, be in writing, or be on paper as a precondition for recordation in the Land Records, an electronic document will satisfy this requirement. Moreover, an electronic signature can be substituted for an original signature. And, a notary can be provided electronically as well. Note, when this bill is fully put into effect, electronic powers of attorney should be filed instead of the original documents, which may lead to a significant change in practice. Effective 10/1/2018)
Though 2018 was a very active year, next year promises to be just as interesting, especially since Annapolis will be welcoming many new members of the General Assembly after the election this fall. Besides the estate planning issues identified in Part 1 of this two-part series, changes to the laws affecting advance medical directives and general powers of attorney may be introduced. And, the End-Of-Life Options Act may be resubmitted in 2019. As is said, stay tuned!
This article is intended to provide general, educational information about recent legislative changes, and should not be considered as legal advice upon which you should rely. Please check with your own attorney if you have any questions or would like follow up on any suggestions made within this article.