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If you’re a business owner, one of the most important choices you must make is whether to hire full-time employees or use independent contractors (IC). While the two classifications may seem quite similar, they both come with a wide array of unique advantages and disadvantages.

What’s more, if you make a mistake when classifying your workers, you can suffer serious penalties and even lawsuits. Here, we’ve broken down the pros and cons that come with hiring ICs, so you can better assess whether or not such workers are a good fit for your company.

One of the biggest benefits of hiring ICs over employees is the money you can save on taxes and worker’s compensation insurance. While ICs may be paid more per hour than employees, you end up saving money in the long run due to the numerous expenses that come with hiring regular employees.

In addition to the cost of maintaining office space and providing employees with the equipment and materials they need to do their job, you’re also required to pay your share of your employees’ Social Security and Medicare taxes, as well as pay for state unemployment compensation insurance and workers’ compensation insurance.

And that’s not even considering any extra benefits you provide your staff, such as health insurance, paid time off, and/or retirement vehicles like 401Ks. Paying for all of these expenses can be a huge hit to your finances, especially if you own a small startup.

Under state and federal laws, employees have an array of legal rights, which means they can bring a wide variety of employment-related lawsuits against you if they feel those rights were violated. While ICs do have some legal rights to sue you, they enjoy far less protection than employees.

Some of the rights employees have that are not afforded to ICs include the right to a minimum wage and overtime pay, employment discrimination protections, rights to sick and family leave, and the right to form unions.

What’s more, employees may also sue employers for wrongful termination. ICs cannot bring such a lawsuit, as their rights to termination disputes are spelled out in the independent contractor agreement created by you.

By hiring ICs, you have much more freedom to staff your company however you see fit. This allows you increased flexibility to adjust your staff based on fluctuations in the market and your workload. This freedom can be especially valuable when you’re just starting your business and aren’t sure what kind of demand your products and services will see.

Additionally, you face far less headache, expense, and potential legal liability when it comes to firing or laying off employees. You can hire ICs for a specific task or project and then be free to walk away from the relationship with no hassles once the work is complete.

One of the great advantages to ICs is the lack of oversight, training, and physical space they require. However, the tradeoff for this freedom is that you have little, if any, control over how they actually do the work you hired them to do.

Indeed, while you’re able to dictate the overall outcome of an IC’s work, they have total “independence” when it comes to how they choose to complete the task at hand, provided it meets the quality and deadline requirements listed in their contract.

Giving workers such total freedom can be difficult for some business owners, especially those that prefer that the work be done using specific processes and/or tools. But it’s vital you don’t interfere too much with an IC’s work, since doing so can result in the IRS re-classifying them as employees, which can result in hefty penalties and expenses.

As mentioned earlier, hiring ICs automatically increases your chances of being audited by the IRS, as the tax agency has a vested interest (in terms of taxes and insurance payments) in ensuring that you maintain an appropriate relationship with independent contractors.

And it’s not just the IRS that can audit your business. A number of federal and state agencies, like the Department of Labor and your state’s unemployment compensation agency, can audit/investigate your company if they think you’re misclassifying employees as ICs.

The bottom line is, if you hire ICs, be sure you take the appropriate steps to ensure that your contractors are truly “independent,” or it can cost you big time.

Whether you consider yourself wealthy or not, you need to think about how (and when) you’ll talk with your children about money, whether they’re little kids, tweens, teens, or already adults.

The Wall Street Journal article “The Best Way for Wealthy Parents to Talk to Children About Family Money” offers guidelines for how and when “the money talk” should take place. Based on interviews with multiple financial experts, the article suggests these discussions should happen in three stages during the child’s lifetime.

Here, we’re showing you how each of these three stages apply to your family wealth as a whole, regardless of how much—or how little—money you have at the moment:

How do you choose a life insurance policy? While purchasing life insurance may seem pretty straightforward, it’s actually quite complex, especially with so many different types available.

In order to offer some clarity on the different types of policies out there, we’ve broken down the most popular kinds of life insurance here and discussed the pros and cons that come with each one.

Since the age of 16, when she burst onto the charts with her debut single, “…Hit Me Baby One More Time,” Britney Spears has been one of the world’s most famous and beloved pop stars. Yet despite her massive fame and fortune, Britney, who is now 39, has never truly had full control over her own life.

As most familiar with pop culture know by now, Britney has been living under a conservatorship for the past 13 years. Also known as “adult guardianship,” a conservatorship is a legal structure in which the court granted Britney’s father, Jaime Spears, and other individuals nearly complete control over her legal, financial, and personal decisions. The conservatorship was initially established in February 2008 after Britney suffered a mental breakdown, which resulted in her being briefly hospitalized.

A Total Loss of Control

Back in 2008, the court-appointed Britney’s father and attorney Andrew Wallet as her co-conservators, as Britney was deemed mentally unfit to care for herself. The arrangement was only meant to be temporary, but in October of that year, the conservatorship was made long-term, and her father has remained in nearly complete control of Britney’s life ever since.

Although there has been widespread speculation that Britney’s conservatorship was abusive, the exact details of her conservatorship have been kept private. Moreover, until very recently, Britney had never spoken publicly about her life under the arrangement.

Years of Abuse and Conflict

However, as we detailed last week in part one, Britney recently testified in a court hearing during which she described a shocking pattern of abuse and exploitation at the hands of her father and others involved with the conservatorship. We also discussed how confidential court records obtained by the New York Times provided support for Britney’s claims and showed that the pop icon had expressed serious opposition to her conservatorship as early as 2014, and tried unsuccessfully on multiple occasions to have her father removed from his position.

In response, Britney’s father flatly denied any wrongdoing, and his lawyers filed a petition requesting the court investigate Britney’s allegations of abuse. Shortly after the hearing, both Britney’s court-appointed lawyer, Samuel Ingham, and Bessemer Trust, the wealth management company, which had previously signed on to be the co-conservator of Spears’ finances, asked the court to be removed from the pop star’s conservatorship.

In a follow-up court hearing held this week on July 14th, Judge Brenda Penny approved the resignation of Ingham and Bessemer Trust and granted a request by Britney to hire her own lawyer. To represent her moving forward, Britney chose Mathew Rosengart, a prominent Hollywood litigator and former federal prosecutor, as her new attorney.

Britney, who phoned into the hearing, once again asked the court to remove her father as co-conservator, and she said that her father should be prosecuted for his alleged abuse. But Britney also reiterated that she’s not willing to undergo any more mental-health evaluations, which she called “stupid psych tests,” according to a report by NPR.

“I’m not willing to sit with anybody at this point to be evaluated,” Britney said. “I want to press charges for abuse. Instead of investigating my capacity, I want an investigation on my dad.”

Although Britney still hasn’t filed the formal legal document seeking to end her conservatorship, which is required by law, her new lawyer, who was present at the latest court hearing, told the judge he plans to file the petition to remove Jamie Spears from the conservatorship. If so, the judge could rule on the petition in the next court hearing on the conservatorship, which is scheduled for September 29.

Use Estate Planning To Avoid Britney’s Fate

Although we’ll have to wait to find out whether the court will allow Britney to terminate the conservatorship without undergoing another psychiatric evaluation, as we noted last week, Britney could have been saved from the years of control by her father,  if she had created a proper estate plan early on in her adult life.

In fact, using a variety of different estate planning vehicles, Britney could have not only chosen the person, or persons, who would be in charge of making decisions on her behalf during her incapacity, but she could have also created legally binding instructions stipulating how her assets and personal care should be managed during her incapacity. With the right planning, Britney could have even spelled out the specific conditions that must be met for her to be deemed incapacitated in the first place.

With this in mind, here in part two, we’ll discuss how you and your loved ones can use proactive estate planning to create a comprehensive plan for incapacity, so you can avoid suffering the same fate as Britney. And since a debilitating illness or injury could strike at any time, at any age, if you’ve yet to create your own incapacity plan, contact me, your Personal Family Lawyer® right away to get this urgent matter taken care of.

Planning For Incapacity: Where To Start

When planning for your potential incapacity, the first thing to ask yourself is, “If I’m ever incapacitated and unable to care for myself, who would I want to make decisions on my behalf?” Specifically, you’ll be selecting the person, or persons, you want to make your healthcare, financial, and legal decisions for you until you either recover or pass away.

The most important thing to remember is that you must choose someone. Like we’ve seen with Britney, if you don’t legally name someone to make these decisions during your incapacity, the court will choose someone for you. And this is where things can get extremely difficult for you and your loved ones.

Although laws differ by state, in the absence of any estate planning, if you become incapacitated, the court will typically appoint a conservator or guardian to make financial and legal decisions on your behalf. As with Britney, this person could be a family member you’d never want managing your affairs, a professional guardian who charges exorbitant fees, or even a crooked professional guardian who abuses and exploits you for their own financial gain.

Furthermore, like most court proceedings, the process of naming a guardian can be quite lengthy, costly, and emotionally draining for your family. And this is assuming your family members agree about what’s in your best interest. If your family members disagree about the course of your medical treatment or managing your finances, this could lead to ugly court battles between your loved ones.

Such conflicts can tear your family apart and drain your estate’s finances. For an example of just how bad things can get, look at the case of Florida’s Terry Schiavo, who spent 15 years in a vegetative state after suffering a heart attack at age 26. Because Terry did not have a living will or health care directive indicating in writing how she would want medical decisions made for her in such an event, Schiavo’s young husband fought Terry’s parents in court for more than a decade for permission to remove her from life support before she was ultimately allowed to pass away.

A Comprehensive Incapacity Plan

Fortunately, such turmoil can be easily avoided through proper estate planning. Determining which estate planning strategies you should use to grant and guide this decision-making authority depends entirely on your personal circumstances. There are several options available, but choosing what’s best for you is something you should ultimately decide after consulting with an experienced lawyer like us because there are many considerations beyond simply whether to “pull the plug”, including how to handle such matters in the event of a pregnancy, whether to keep providing hydration and nutrition (and, if so, what kind), and how to determine incapacity. These, and other factors, are not typically addressed in a standard advance health care directive.

That said, we can tell you one estate planning tool that’s totally worthless when it comes to your incapacity—a will. A will only goes into effect upon your death, and then it merely governs how your assets should be distributed, so having a will does nothing to keep your family out of court and out of conflict in the event of your incapacity.

When it comes to creating your incapacity plan, your best bet is to put in place an array of different planning tools, rather than a single document. To this end, your plan should include some, or all, of the following:

Durable financial power of attorney: This document grants an individual of your choice the immediate authority to make decisions related to the management of your financial, business, and legal affairs, and can state how your affairs should be handled.

Revocable living trust: A living trust can immediately transfer control of your assets held by the trust to a person of your choice to be used for your benefit in the event of your incapacity. The trust can include legally binding instructions for how your assets should be managed, and the document can even spell out specific conditions that must be met for you to be deemed incapacitated.

Medical power of attorney: An advance directive that grants an individual of your choice the immediate legal authority to make decisions about your medical treatment in the event of your incapacity.

Living will: An advance directive that provides specific guidance about how your medical decisions should be made during your incapacity, including who should be able to see you and specifics regarding how you want your care to be handled. In some instances, a medical power of attorney and a living will are combined in a single document.

Documents Aren’t Enough

In the end, there’s one thing to remember about all of these documents—they are just documents, and they don’t provide your loved ones with a trusted advisor who is often needed to deal with all potential outcomes, and to navigate the legal system on your behalf. If you really want to keep your family out of court and out of conflict, you cannot just rely on documents to do it. Instead, these documents should be created by a lawyer like us who will get to know you, your wishes, and be there for you throughout the many stages of life—and ultimately be there for your family when you can’t be.

Furthermore, in addition to the above estate planning documents, it’s equally—if not more—important for your loved ones to be aware of your plan and understand their role in it. As part of the planning process, a Personal Family Lawyer® will hold a family meeting with all of the individuals impacted by your plan, where we walk them through your plan, explaining the reasoning behind your decisions and what they need to do if something happens to you.

In the end, you’ll find that the best protection comes from combining your comprehensive incapacity plan with a team of people who will care for you, can watch out for you, and know exactly what to do in the event tragedy strikes. As your Personal Family Lawyer®, we can guide and support you to put in place both of these elements. In doing so, it would make it virtually impossible for a conservator or legal guardian to ever be appointed—or even need to be appointed—against your wishes, and instead, we will create a robust plan that would allow you to stipulate how your life, healthcare, and assets should be managed if you ever become unable to manage them yourself.

Timing Is Everything

Keep in mind that your incapacity plan must be created well before you become incapacitated. You must be able to clearly express your wishes and consent in order for these planning documents to be valid, and even slight levels of mental illness or dementia could get them thrown out of court.

Plus, as we mentioned earlier, an unforeseen accident or illness could strike at any time no matter your age, so don’t wait—contact us right away to get your incapacity plan started.

Finally, it’s vital that you regularly review and update your estate plan to keep pace with changes to your life, family dynamics, and the law. If any of the individuals you’ve named becomes unable or unwilling to serve for whatever reason, you’ll need to revise your plan accordingly, and we can help with that, too.

Let Britney’s Story Be A Lesson

Although Britney’s story is certainly tragic and we can’t be sure how it will ultimately play out, her case has at least shined a spotlight on the potential for abuse that exists within the conservatorship and guardianship system. In fact, Britney’s case has already inspired lawmakers at both the state and federal level to take a closer look at adult guardianships and push for increased oversight and transparency for these legal arrangements.

As one Congresswoman from Massachusetts told Politico, “If this could happen to someone who is as famous as Britney Spears, I mean, think about what’s happening to regular Americans. We need to pull back the curtain on this.” said Rep. Lori Trahan.

By the same token, Britney’s story should inspire you to make certain that you and your loved ones have the proper estate planning strategies in place to prevent the loss of autonomy, family conflict, and potential for abuse that comes with court-ordered conservatorships and guardianships.

To this end, if you’ve yet to plan for incapacity, schedule a Family Wealth Planning Session™ right away, we, your Personal Family Lawyer®, can advise you about the most suitable estate planning vehicles to put in place. And if you already have an incapacity plan prepared—even one created by another lawyer—we can review it to make sure it’s been properly set up, maintained, and updated. Contact us, your Personal Family Lawyer® today to plan for your life.

Proper estate planning can keep your family out of conflict, out of court, and out of the public eye. If you’re ready to create a comprehensive estate plan, contact us to schedule your Family Wealth Planning Session. Even if you already have a plan in place, we will review it and help you bring it up to date to avoid heartache for your family. Schedule online today.

Operating a business dependent upon your skills and expertise makes you a very valuable person to your business, but could leave your income (and your family’s well-being) at risk if and when something happens to you.

Maybe you have not considered how important estate planning is because you’ve just accepted the fact that your business will end when you do.

But it is important to understand that your family could be left with a significant financial burden when you die.

If you handle business operations, the value of your business is intimately tied to you and the work you put into it. Thus, the value greatly reduces after you die. Even so, your family could be stuck with an estate tax that reflects the value of your business right before your death.

Probably every parent who has watched the news lately has felt the heartbreak over what’s happening to immigrant families at the border due to the Trump administration’s immigration regulations.

As you likely know, the administration’s new “zero-tolerance” policy has led to the separation of more than 2,300 children from their parents at the U.S.-Mexico border between May and June 2018 alone.

Putting politics aside, with horror stories of toddlers being ripped from their mothers’ arms and audio recordings of children crying and begging for their parents, we imagine it would be hard for anyone with their own kids not to be disturbed.

What’s more, perhaps these events have got you thinking about how it would be for your children to be taken into custody of strangers. And if not, let this be the moment you willingly feel the fear and decide to use your privilege of being able to make choices on behalf of your children to ensure their well-being and care by the people you want no matter what happens.

Even though most people think that something like that could never happen to their family, they’re totally wrong. While your kids almost certainly won’t be taken into custody by U.S. border agents, your children could be taken into the care of strangers if something happens to you—even if your family or friends are on the scene.

But you can do something to protect your children and ensure they’re always in the care of people you know, love, and trust. If you use this atrocity against families to take action on behalf of your own kids—instead of merely feeling numbness and paralysis over not knowing what to do—these events can inspire you to do the things you know you must in order to properly take care of your family.

While it may seem like a long shot, the consequences are serious enough that you must consider the real possibility of what could happen and ensure you’ve taken right actions to protect your loved ones. Let’s say you and your spouse have gone out to dinner together and left the kids with a babysitter. But on the way home, you’re in a car accident. The police will get to your house, find your children home with a babysitter, and have no choice but to take your kids into the care of the authorities (strangers) until they can figure out what to do.

This is the case even if you have friends or family living nearby. If you haven’t left proper legal documentation, the authorities have no option but to call child protective services—that is, unless you’ve legally given them an alternative. This is true, for example, even if you have named godparents. You must give the authorities a legal basis for keeping your children with the close friends or family you designate.

Without your action, when the babysitter answers the door, she’s in complete shock and willing to stay with your kids while the authorities find a relative to take them. Unfortunately, she doesn’t have the legal authority to care for the children—even temporarily—so the police have no choice but to call child protective services. These authorities will take your children into custody until they can locate and/or appoint the proper guardian.

Alternatively, maybe you have plenty of family, who’d want to take custody of your children if something were to happen to you. Perhaps some of them even live close by, so the authorities could locate them easily. It may be that even more than one family member would want to take custody of your children (and the financial resources you’re leaving behind for them).

We’ve seen what happens when well-meaning family members—who think they’d be the best choice as caretaker for their young relatives—go to battle in the name of love. It isn’t pretty. In such a situation, it takes years of legal fighting, making lawyers wealthy, while the children are stuck in the middle. In almost every case, each side fighting for the care of the children feels certain they’re doing what the parents would’ve wanted and what’s best for the children.

The sad thing is, this all can be completely (and very easily) prevented. However, to ensure your children are never taken into the care of strangers—or put in the middle of a family conflict—you must take action now. Please do not leave this to chance. You have the privilege to be able to guarantee that your children are never taken into the care of strangers—or into the care of anyone you would not choose—but you must take action now to exercise that privilege.

Perhaps you believe this could never happen to your family because your family would never fight over your children or because you’ve named close friends as godparents. But why take that risk, when it’s so easy to do the right thing by the people you love more than anything?

And if you think you’ve already done the right thing because you have a will that names legal guardians for your children, think again. We’ve found that in most cases, even parents who worked with a lawyer to name legal guardians have made at least one of six common mistakes that leave their children at risk.

These mistakes are made because unfortunately, most lawyers do not know what’s necessary for planning and ensuring the well-being and care of minor children.

As your Personal Family Lawyer®, we’ve been trained by the author of the best-selling book, Wear Clean Underwear!: A Fast, Fun, Friendly, and Essential Guide to Legal Planning for Busy Parents, on legal planning for the unique needs of families with minor children at home. If you’ve already created a will, we can help you identify whether you’ve made any of the six common mistakes that could leave your children at risk. If you have not yet taken any action, we can help you take the first steps and make the very best decisions for the people you love.