By Maria Schmidlekofer, Farm Succession and Estate Planning Attorney at Schwabe
The other day, our son fixed our toilet by learning how to do so on YouTube. When he asked me if he could try, I felt a little trepidation about a newly minted adult with no experience, but then thought: Why not? We can always call a plumber if he doesn’t fix it.
With the rise of AI, it is tempting to go online to ask ChatGPT to draft a will or search Google for a free power-of-attorney form and select from the many options that pop up. You’ll get thousands of hits for free legal documents, as well as many rabbit holes to go down for free “legal advice” on how to draft legal documents. I have been asked many times to “do a quick review” of documents downloaded online.
Photo of Maria Schmidlkofer
The stakes are much higher for self-help legal advice than plumbing, though. Unlike plumbing, you will not know if it works until it is too late to call in a professional to fix it. It’s like a serious illness, when you go to a doctor, rather than seek self-help miracle cures online.
In family farm succession planning and estate planning, the stakes can be high. These decisions involve not just you, but your legacy after you’re gone. If you implement documents without legal advice, you don’t really know what you’re getting. Even more important, you do not know what you might be missing. Self-help estate planning can have unintended consequences that could be avoided.
It does not get more serious than protecting yourself financially and medically to make sure that all you have accumulated will be passed on the way you want, when you want, and how you want—without incurring unnecessary taxes or family discord.
Folks might say that “something is better than nothing.” They regard online legal documents as a short-term, quick fix, like patching a tire you know you’ll replace eventually. I disagree. After the initial panic of a quick fix before surgery or vacation, how many folks actually go back and arrange to get the proper legal documents prepared?
In my opinion, you are actually paying for the legal advice, not the document. You are engaging a trained farm-succession lawyer as your advocate to listen, comprehend your family situation, and provide legal advice about your options from a tax and family dynamic perspective to protect you and your loved ones.
I am often concerned by power-of-attorney documents and LLC operating agreements. People can download others’ forms from the Internet and have someone sign them without any thought as to the possible consequences. Granting a power of attorney is something that depends on individual circumstances. They can become active upon disability, or they might be durable, used any time after execution. It is possible that the wrong form could lead to deeding a farm away, draining bank accounts, running up credit cards, taking out loans, or a host of other problems.Before signing such documents, it is important to pause and consider with one’s lawyer the possible ramifications.
Operating agreements can also be problematic. Generic forms can inadvertently contravene a succession plan. Whether it pertains to a buyout to those to whom a departing member can sell interest, these can be vital terms to consider. In my view, an LLC operating agreement should align with estate planning documents in order to ensure that the member’s intent is fulfilled.
By the way, I haven’t told my son, but it has been a week since I started to write this article, and it looks like it’s time to call in that professional plumber.
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Questions? Interested in learning more? Contact Maria at: mschmid@schwabe.com
This article summarizes aspects of the law and does not constitute legal advice. For legal advice for your situation, you should contact an attorney.