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Home Blog Iowa Conservators Take Note New Law Effective January 1, 2020

Iowa Conservators Take Note New Law Effective January 1, 2020

Iowa Conservators Take Note New Law Effective January 1, 2020

Our Trust Officers have spent considerable time the past few months learning about upcoming changes to the Iowa law regarding Guardianships and Conservatorships for adults and minors. As Corporate Fiduciaries, it is our responsibility to understand and follow changing laws and regulations when it comes to the administration of our accounts. This is one of the key differentiators between naming an individual, such as a family member, and a Corporate Fiduciary, in your legal documents. For those of you trying to decide if naming a Corporate Fiduciary is necessary, we hope this information is an example of the importance of experience and knowledge of changing laws in making that decision. For those of you acting as a fiduciary for a family member or friend, we hope this information is helpful and always welcome discussing how we can support you in your role. We will focus on changes to Conservatorships in this blog post; however, please note Guardianships are also impacted by the legislation.

Key Notes:

  • To address the growing concerns with elder abuse in Iowa, the Iowa Guardianship and Conservatorship Reform Task Force published a report with proposed changes in August 2017.
  • House File 610 adopted the proposed changes and was signed into law May 1, 2019, effective January 1, 2020.
  • Across the state, there are varying opinions on the impact of this legislation.  
  • For new guardianships and conservatorships which are opened after December 31, 2019, there are new requirements requiring professional evaluation of the proposed protected person and a requirement for a background check for proposed Conservators.  The Conservator is required to file an initial plan with the court within 90 days after appointment and is also required to file an inventory of assets within 90 days after appointment.    
  • The new law will also apply to Conservatorships which were opened before January 1, 2020.
  • For the past year, there has been much debate within the Iowa State Bar Association and Iowa Trust Association regarding whether Conservators should proactively seek expanded Court authority before the end of the year as the revised law no longer provides broad authority but rather requires specific Court orders to allow the Conservator to:
    ►.Open, close, deposit and withdraw funds in accounts at any financial institution;
    ►Sell or transfer any real property or personal property of the protected person;
    ►Receive or accept additional property from any source;
    ►Pay routine expenses for health care, nutrition, living quarters, and activities;
    ►Reimburse the guardian or conservator for out of pocket expenses to purchase goods and services for the protected person;
    ►Utilize the protected person’s property and/or income to provide support for anyone the protected person is legally obligated to support;
    ►Purchase and maintain health care, automobile, home property and liability insurance coverage;
    ►File all federal and state income tax returns and pay all taxes owed;
    ►Retain and compensate individuals or companies to provide necessary services, including transportation, food preparation, home maintenance, tax preparation and acquisition of food, clothing and other necessities and sundries;
    ►Pursue and/or defend and/or compromise any and all claims by or against the protected person;
    ►Pay court approved fees for the guardian, conservator, attorney and court visitor;
    ►Accumulate funds not needed for upcoming expenses in prudent investments pursuant to Section 633.123 including FDIC-insured deposits, US Treasury obligations, and publicly traded stocks, bonds, mutual funds and other investments;
    ►Provide for an regular allowance for the protected person for food, health care, clothing, training, education, transportation, entertainment, and other necessities;
    ►Allow the conservator to request and receive information regarding the assets of the protected person, including digital assets under Chapter 638;
    ►Allow the conservator to obtain and maintain a court ordered bond;
    ►Authorize the conservator to act as the representative payee for the protected person including apply for and receiving Social Security payments;
    ►Allow the conservator to make gifts consistent with the pattern of giving established prior to the conservatorship and to make gifts which are beneficial to the protected person for tax purposes.
    ►Allow the Conservator to serve as Representative Payee to receive Social Security payments and file required reports.
  • Fortunately, on October 22, 2019, Chief Judge Kurt L. Wilke settled the matter for the 2nd Judicial District confirming that existing Iowa Conservators appointed prior to January 1, 2020 have continuing authority to perform acts concerning the Protected Person’s financial affairs and assets that were authorized by statute prior to January 1, 2020. We recommend existing Conservators consult with legal counsel to ensure they are prepared for the substantial changes to Iowa law in the coming year as the Initial plan and compliance with the revised law will be necessary in 2020. If you are serving as a fiduciary and would like our assistance, we are able to serve in a Co-fiduciary capacity to assist you. Call us at 641-422-1600 or email wealth@myfcbank.com to schedule an appointment today.   
Products provided by First Citizens Wealth Management are not insured by the FDIC, are not deposits of the bank and are not guaranteed by this institution; and, are subject to investment risks, including possible loss of the principal invested. Please note that neither First Citizens Bank nor the First Citizens Wealth Management Department provide tax or legal advice. This is intended for informational purposes and is not intended to constitute legal or tax advice. Please consult your attorney and/or tax professional for advice related to your specific situation. 

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