Monthly Archives: September 2024

The Nexus of Family Therapy, Counseling, and Estate Planning: Safeguarding Wealth and Wellbeing

9/24/2024

Therapy Works Counseling Services, PLLC
4645 Avon Ln Suite 120A Frisco, TX 75033
4054 Mckinney Ave suite 300 Dallas, TX 75204
629 W Centerville Rd Suite 209 Garland, , TX 75042
1101 suite B Bedford Rd, Bedford, TX 76022
(972) 695 3421  hola@therapyworkscounseling.com

 

 

 


In today’s rapidly evolving world, family dynamics play a crucial role in shaping our mental health and financial stability. While family therapy and counseling primarily aim to resolve personal conflicts and enhance emotional wellbeing, they also intersect significantly with estate planning. Estate planning encompasses wealth acquisition, management, protection, and distribution, all of which require sound mental capacity. However, family disunity, mental illness, discord, and divorce emerge as formidable adversaries that can jeopardize both family wealth and wellbeing. This blog delves into the current crisis in America, exploring how these elements impact estate planning, tax planning, and family inheritance.

The Crisis in American Families

*Mental Health Challenges:*

Mental illness is a silent saboteur that weakens familial bonds and impairs decision-making capabilities. Conditions such as depression, anxiety, and substance abuse can reduce an individual’s ability to manage and protect their wealth effectively.

*Family Disunity and Discord:*

When families are divided by conflict or lack of communication, the collaborative effort needed for effective estate planning is disrupted. Sibling rivalries, parental favoritism, or unresolved past grievances can all contribute to an environment of distrust and disunity.

*Impact of Divorce:*

Divorce not only splits families but also fractures financial stability. Legal fees, asset division, and potential loss of income all reduce the overall financial health of the family unit.

Estate Planning: More Than Just Wealth Distribution

*Acquisition and Management:*

Effective estate planning begins with the acquisition and strategic management of assets. Families that engage in open and honest dialogues about financial goals tend to be more successful in accumulating wealth. This process necessitates a sound mental state and the ability to make robust financial decisions.

*Protection of Wealth:*

Preserving wealth requires a thorough understanding of tax planning and the establishment of trusts or other financial instruments. Family unity plays a critical role here. When families are united, they can collectively prioritize and implement strategies to safeguard their financial assets.

*Wealth Distribution:*

Distributing wealth according to a well-constructed estate plan ensures that assets are passed down efficiently. However, mental illness or family disunity can drastically impede this process. Misunderstandings and conflicts over inheritance can lead to prolonged legal disputes, reducing the value of the estate.

The Role of Family Therapy and Counseling

Family therapy and counseling serve as foundational supports to address the psychological and relational issues within a family that can disrupt estate planning efforts.

*Facilitates Communication:*

Therapy encourages open, honest dialogue, helping family members articulate their concerns and desires regarding financial matters.

*Resolving Conflicts:*

Counseling addresses underlying conflicts, helping to build a cohesive unit capable of making united decisions about wealth management and distribution.

*Mental Health Support:*

Therapy provides resources and coping mechanisms to individuals suffering from mental illnesses, ensuring they can partake in estate planning.

The Impact on Tax Planning and Inheritance

A well-structured estate plan can significantly reduce tax liabilities, but mental illness and family discord can nullify these benefits. Mismanagement, legal disputes, and unplanned distributions can lead to unnecessary tax burdens. Furthermore, unresolved mental and emotional issues can result in impulsive financial decisions that undermine an estate’s integrity.

The interplay of family therapy, counseling, and estate planning is crucial in safeguarding both financial assets and familial wellbeing. By addressing mental health issues, resolving conflicts, and fostering unity, families can better manage, protect, and distribute their wealth, ensuring stability for future generations. As America grapples with a mental health crisis and rising familial discord, integrating therapeutic support in estate planning becomes not just beneficial, but essential.

Ana Marcela Rodriguez, MS
Licensed Marriage and Family Therapist
founder/ CEO

972 695 3421

www.evaluacionesclinicas.com / www.evaluacionespsicologicastexas.com/ www.therapyworkscounseling.com

Are Personal Injury Settlements Taxable?

9/17/2024

 

After suffering from an injury due to someone else’s negligence, winning a personal injury
settlement can feel like a huge relief. You no longer have to worry about medical bills, lost
wages, or other expenses incurred as part of your accident. However, it is important to be
careful how you use your settlement because some of it can be taxed, as a personal injury
lawyer can explain:

What Is Taxable
Part of the purpose of a personal injury settlement is to cover lost wages — that is, wages you
would have earned at your job had you been healthy and working instead of injured. When you
work, you pay taxes on what you earn. A personal injury settlement can recoup those lost
wages so that you still receive the same amount of income you would have if you had been
working. And, just like at your job, that income is taxable, even though it was part of a
settlement.

Medical bills may also need to be included as income, which then means they will be taxed.
This happens if expenses related to your injury were previously deducted the year before.
Additionally, some settlements may accrue interest which is also taxable. Other kinds of
settlements that are taxable include those awarded for emotional distress. If you win a
settlement for emotional distress and it is not directly tied to a physical injury, this will be taxed.
That also means that if you are awarded damages to punish the defendant for their negligence,
those too are taxed even if they were connected to a physical injury.

Finally, as our friends at Cohen & Cohen can share, some attorney’s fees may be taxable.
However, there are many variables that contribute to this, mainly how those fees are structured
and if they are already being deducted from the overall settlement. Your lawyer will let you know from the start how that portion of this process works.

What Is Not Taxable
The main portion of your personal injury expenses are not taxable, meaning medical expenses
(so long as they were not previously deducted), pain and suffering, and emotional distress (if
you can prove it is a direct result of your injury). You receive compensation for the injury itself
and it is not seen as taxable income because the government views these payments as
restitution for what was lost instead of just providing income. Medical expenses are seen in a
similar light; you are receiving the settlement to cover your costs and not gain income.

It might seem confusing, but if you are awarded worker’s compensation, that is not taxable. That is because worker’s comp is considered a benefit offered by your job — think of it just like
insurance; this is a payout rather than straight income from your place of employment.

What To Do After A Settlement
To win a personal injury case, you will need to work with an injury lawyer. Once they win your
case, you should then contact a tax attorney. They will be able to help you best manage your
settlement and help you prepare for any taxes coming your way after winning it. Work with an
attorney so that you can focus on healing rather than worrying about what you will owe in the
future. Contact a lawyer near you today for help.