Friday, April 1, 2011
By Susan Graham
When I was in high school every spring the mother of my best friend would change the living room curtains and furniture covers from dark winter colors to bright summer fabrics. At the same time she would spend a week doing a thorough cleaning. When she was done her house looked like it should be in “House Beautiful.”
How does this relate to your estate plan? It’s time for a little “Spring Cleaning” for your planning documents. Just take a few minutes to check your affairs and see if they are up to date before you are too busy with fun and family activities.
Here is a simple checklist:
• Where are your planning documents? Do the people you expect to back you up know where to find them?
• Are the people you identified on your financial and health power of attorney still appropriate? Do they know they have this job and do they know where to find the papers that authorize their status?
• If you have a Trust, have you titled your assets in the Trust name?
• If you have assets with beneficiary designations such as retirement accounts, IRAs, life insurance and annuities, have you named the appropriate people or your Trust as the beneficiary of those assets?
• Have you written your list of who gets your “stuff” (ring, lamp and gun) when you are gone?
• Have you filled out your “Bucket List” of the wonderful things you wanted to do between now and when you die?
Now is a perfect time to do “Spring Cleaning” in this corner of your life. It should take you less than half an hour. I promise you will be pleased with yourself once you have completed this checklist.
Friday, March 25, 2011
Florida's proposed Medicaid overhaul puts spousal refusal on the chopping block. And that spells trouble for Florida seniors, who will find it tougher to get Medicaid benefits
if they ever need longterm nursing care. The 2010 survey of nursing home costs by the Metlife Mature Market Institute shows that in South Florida, the average cost of a private room at a nursing home $302 per day. Those kinds of numbers will wipe out the average family in short order.
The proposed new law, Florida SB 1356, would deem any interspousal transfer made after July 1, 2011 in excess of $109,560 to be a gift for Medicaid eligibility purposes. Thus, if a spouse needs to enter a longterm care facility and wants to apply for Medicaid benefits, the well spouse can be left with no more than $109,560 in assets. That is not much for a well spouse to live on. After a lifetime of hard work and saving, that's a sad way for someone to end their days.
Given this dire outlook, those who do not have the considerable resources to pay privately for longterm care, and those who do not have adequate longterm care insurance, are well advised to act now. Our Florida elder law attorneys
can assist you to put proactive plans in place that may enable you to preserve a significant portion of your assets.
Historically, our law firm has been able to help families preserve assets even if a loved one is already in a nursing home, or about to enter one. We will probably be able to continue to do so, but the new law is going to make it far more problematic. In any event, it is always preferable to plan in advance, as a greater percentage of assets can likely be preserved.
One advance planning method is the Florida Irrevocable Medicaid Trust.
This is a flexible legal instrument that can save your family significant funds in the long term. It is also a complex one, and should be planned and drafted only under the guidance of a lawyer who is experienced with these matters and certified by the Florida Bar in elder law.
To hear more about your options for Medicaid planning and preserving assets in today's economic climate, listen to my recent interview
on the "Seniors Taking An Active Role in Society" radio program. For asssistance in putting a plan in place to protect your assets from being wiped out by nursing home costs, contact our Florida Elder Lawyers
Friday, March 25, 2011
By Susan Graham
The Graham Law Office, P.A.
Idaho is last in line (again). In supporting Idaho Legal Aid Services (ILAS.)
49 states provide financial support for Legal Aid Services to assist the poor and elderly access the legal system. Idaho does not.
I am on the Board of Directors for Idaho Legal Aid. I went to a meeting yesterday at the Idaho Statehouse where Legislators, Representatives of the Idaho Supreme Court and Idaho Legal Aid were present.
Idaho Legal Aid had to cut back their services for seniors last year because they lost funding. I am an advocate for seniors. I want to protect their independence, families and assets. Idaho Legal Aid provides services for seniors who cannot afford a private attorney. They help them keep their home, get Medicaid benefits, or other services that allow them to live independently and safely.
ILAS is out of money. They have tapped their reserves, and currently, most of their staff, who are devoted to helping the disadvantaged, are working part-time.
This is the letter I sent to Representatives of the Idaho House Committee
I am writing to request that you support House Bill 300. The passage of this Bill will result in a $10 increase on certain civil court filings fees, which would be used to support Idaho Legal Aid Services (ILAS).
ILAS is the only state-wide non-profit law firm that provides free civil legal services to the poor and other vulnerable residents of Idaho. Examples of the type of cases they handle include: exploited seniors, foreclosures, domestic violence, homeless veterans and neglected children.
ILAS serves less than 20% of the demand for its services. If this Bill is passed, it will allow ILAS to restore 15 part-time employees to full-time status.
The work of ILAS brings money into Idaho communities. For example, in 2010 ILAS helped 298 victims of domestic violence obtain custody of their children and orders for child support, medical and day care costs. The value of these awarded funds for a single year, is approximately $1,700,000. As a result of these efforts and the resulting awards, there are 298 fewer individuals who need welfare, which has a positive impact on the state’s budget.
Currently, Idaho is the only state in the union that does not provide state funding support for their Legal Aid organization. In 2006, 75% of the Idaho State Bar members passed a resolution supporting an appropriation or filing fee to support ILAS. Without this additional funding for ILAS it will be impossible for them to continue to provide their current level of services, which is only 20% of the demand for its services.
I am an attorney with a practice that represents the elderly. This past year ILAS had to put cutbacks in place that limit their ability to represent low-income elderly, which leaves them with nowhere to turn.
I request and encourage you to support House Bill 300 to fund Idaho Legal Aid Services. Thank you for your attention to this matter.
Susan M. Graham
Attorney at Law
What can you do? Contact your Legislator and ask that they support House Bill 300. Time is short, so please do this today. Please call the Legislative Information Center at 208-332-1000 or 1-800-626-047 and advise them you are supporting House Bill 300 in the Judiciary, Rules, and Administration Committee. If you have to leave a message, please include your name, address, and Legislative District if you know it.
Thanks for your help. Susan
Friday, March 18, 2011
by Susan Graham
Yesterday at lunch I made a nice salad, with lettuce, beets, onions and a little dressing. While I was chopping things I tossed tidbits to my dogs, who grabbed pieces of lettuce, peelings and an occasional whole radish out of the air.
Last evening I made a salad for supper, and again tossed trimmings to my dogs Lucy (mostly a border collie) and Pepper (mostly a Lab). Before I started cooking the rest of my meal, I took out the trash, leaving the salad in a bowl on the counter. I was back in less than 2 minutes. I noticed bits of salad on the counter and on the floor, with about 2/3 of the salad left in the bowl.
I was not mad. I trained them to like salad trimmings and I enjoy their company. But I did not recognize I created a monster (dogs that love vegetables, including the ones I thought I would have for supper.)
Why am I sharing this with you? Just to remind me (and you) that it's “just life.” Things happen and if any one is at "fault", it is me, because I trained my dogs to love salad fixings.
Does that apply to you too? What have you set up or who have you set up to be dependent on you and expect tidbits (money, housing, cars, emotional support) that you freely gave, but did not expect they would come to “expect” your generosity or take from you when your back was turned for a moment?
This event is a reminder that we have to speak up and create limits, such as pushing the salad bowl to the back of the counter when I leave the room, or telling your adult children that you can no longer pay their mortgage or bail them out of yet another financial crisis. We each need to be more careful about taking care of ourselves, because the government is taking away the social safety nets since we have such a huge deficit.
Have a grand week. Susan
Friday, March 11, 2011
by Susan M. Graham
I have reached the point in my life where I want to rent an 8-12 year old to help me with my phone, computer and other electronic items in my world. I found something almost as good, and available on demand.
Look at the website TeachParentsTech.org
. They have many short 1-2 minute videos to show you how to do simple things on your PC or Mac computer. My first lesson was how to make the computer screen print bigger! Yeah! Now I can see the print without squinting or trying to change the lighting or angle of my screen.
A grand side effect is the series of enthusiastic young people clearly explaining in simple ways some of the many mysteries of technology. They make me optimistic about the future.
Friday, March 4, 2011
Actor Mickey Rooney has been the alleged victim of elder abuse at the hands of his own stepkids, according to the restraining orders filed Monday. The 90-year-old actor, who, born in vaudeville has had one of the longest careers of any actor, was granted court protection from stepson Chris Aber and his stepdaughter Christina Aber, after he filed a case against them charging verbal, emotional and financial abuse, and for denying him such basic necessities as food and medicine. The court documents say that both Chris and Christina Aber have been keeping Rooney as “effectively a prisoner in his own home: through the use of threats, intimidation and harassment. Chris Aber has also been accused of taking control over Rooney’s finances, blocking access to his mail and forcing the actor into performances he does not whish to do. With the assistance of attorneys Bruce Roth and Vivian Thoreen of Holland & Knight LLP, Rooney sought and was granted temporary protection for not only himself but for his wife, Jan Rooney, and his stepson, Mark Rooney, who lives with the actor. Rooney fears for their safety and is worried Chris and Christina Aber might retaliate in a physically abusive way, or try to kidnap the actor now that the case has been filed, court documents say. “All I want to do is live a peaceful life, to regain my life and be happy,” Rooney wrote in a statement to his fans. “I pray to God each day to protect us, help us endure and guide those other senior citizens who are also suffering.”
Wednesday, February 16, 2011
Investor Business Daily reports, "Choosing a financial advisor can be akin to a stroll through a minefield. If you don't prepare, your wealth could get blown up by a Bernie Madoff or wounded by someone whose skills are mediocre or simply not suited to your needs. But with proper preparation, chances are you'll find one of thousands of advisers who can help you set and achieve your goals."
Meeting with a prospective advisor to understand how they get compensated for their services as well as determine your comfort level with that individual is essential. Addition insight into an adviser can be found in promotional materials, websites and professional certifications. You may also look up an adviser's Form ADV, which lists complaints and disciplinary actions, online with the Securities and Exchange Commission or your state regulators.
A estate planning attorney would be a good referral source for a qualified financial advisor.
To view Investor's Daily article which also includes The Certified Financial Planners Board's list of ten recommended questions to ask when interviewing a financial advisor, click here.
Friday, February 11, 2011
by Michael Ettinger, Esq.
A couple came in to see me today for the husband's 88 year old father who is a nursing home in Florida. They now wish to bring him up to New York to be nearer to the family. He has about $600,000 in assets, including his home.
They told me about the very nice lawyer he has down on the west coast of Florida, who set up a revocable living trust for Dad and for Mom who died last year, in February of 2006, and amended it in March of 2010.
They had a great deal of confidence in the lawyer, especially since he had won an award as one of the top lawyers in the locality.
Regrettably, while the attorney prepared a fine estate plan, he was not an elder law attorney and took no steps to protect the couples' assets back in 2006, when they were well into their eighties.
Had the lawyer been knowledgeable in elder law, which unfortunately so many estate planning attorneys are not, he would have set up a Medicaid Asset Protection Trust (MAPT) and started the five year "look back" period running. It is now February, 2011, five years later. Had the MAPT been set up when it should have, in February 2006, instead of the revocable living trust, all of Dad's assets would now be protected and he would be eligible for Medicaid benefits to pay for the cost of his nursing home care.
Instead, the couple will only save half the assets by using the "gift and loan" strategy developed by elder law attorneys to save half the assets on the nursing home doorstep when the client has failed to set up the MAPT. The technique is also call "half a loaf" planning after the old expression.
Nevertheless, the "nice" lawyer ended up costing the family $300,000.00 and it is not the first time we have seen it happen. Indeed, it is the reason your writer published "Ettinger on Elder Law Estate Planning", available on Amazon.com. We believe that clients need a new york "elder law estate planning" attorney and not just an "estate planning" attorney so mistakes like this no longer happen to good people.
Friday, February 11, 2011
by Michael Ettinger, Esq.
Family members overwhelmingly provide the care for elderly and disabled loved ones at home. Although a labor of love, taking care of ailing loved ones also has a market value, meaning that caretakers can be paid as a way to protect assets.
Through the use of a Caregivers Agreement, also known as a Personal Services Contract, the disabled or elderly person can transfer money to family members as compensation rather than as a gift. Gifts to family members made in the last five years before applying for Medicaid to pay for nursing home costs disqualify the applicant from receiving Medicaid for a certain period of time, known as a "penalty period."
For example, Mom depends on daughter Janice for her care. If Mom gifts $100,000 to Janice, then goes into a nursing home in the next five years, and applies for Medicaid, the gift to Janice will result in about a nine month penalty period. Janice will have to give the $100,000 back to Mom to pay nursing home costs during the penalty period, or Mom will have to use other resources to pay.
Instead, using a Caregivers Agreement, Mom pays Janice $2,500 per month for caregiving services. If Mom moves to the nursing home in the next five years, the payments to Janice are compensation, not gifts.
Caregivers Agreements must follow strict rules, so should be drafted by an experienced New York elder law attorney.
The Caregivers Agreement must detail the services to be performed and the obligations of the parties. The payment is based on the going rate of caretaking in that county. Compensation is clearly delineated with hourly and yearly calculations for 24-hour personal care.
Janice must actually give the care and document her caretaking duties. Mom must actually need the care, which should be documented with a doctor's note.
To protect family relationships, it's recommended that all family members agree with the arrangement even if they are not parties to the agreement.
Janice has tax consequences. She reports the payments as ordinary income on her income tax return and pays income taxes on the compensation. In some cases, Mom may be able to deduct the payments as a medical expense.
A proper Caregivers Agreement arrangement can be a valuable elder law planning tool in the right circumstances.
Friday, February 11, 2011
by Susan M Graham, Esq.
The Department of Veterans Affairs has a list of “Presumptive” Disability Benefits for Certain Groups of Veterans. What does it mean to have a “presumptive” service connected disability? According to the VA they presume “that specific disabilities diagnosed in certain veterans were caused by their military service.”
This means if you are a veteran and have been diagnosed with one of the identified conditions you may be eligible to receive a military service connected disability.
I have attached the list prepared by the VA.
Friday, May 28, 2010
submitted by Peter G. Lennington, Esq., St. Paul, MN
This post, examines the unique planning requirements of families with children, grandchildren or other family members (such as parents) with special needs. There are many misconceptions in this area that result in costly mistakes in planning for these special needs beneficiaries. It is therefore incumbent upon us - the client's advisors - to ensure that clients understand all of their options.
COSTLY MISTAKE #1: Disinheriting the child.
Many disabled people rely on SSI, Medicaid or other government benefits to provide food and shelter. Your clients may have been advised to disinherit their disabled child - the child who needs their help most - to protect that child's public benefits. But these benefits rarely provide more than basic needs. And this "solution" does not allow your clients to help their child(ren) after the client becomes incapacitated or is gone. When a child requires, or is likely to require, governmental assistance to meet his or her basic needs, parents, grandparents and others who love the child should consider establishing a Special Needs Trust.
Planning Tip: It is unnecessary and in fact poor planning to disinherit a special needs child. Clients with special needs beneficiaries should consider a Special Needs Trust to protect public benefits and care for the child during the client's incapacity or after the client's death.
COSTLY MISTAKE #2: Procrastination.
Because none of us knows when we may die or become incapacitated, it is important that your clients plan for a beneficiary with special needs early, just as they should for other dependents such as minor children. However, unlike most other beneficiaries, a child with special needs may never be able to compensate for a failure to plan. A minor beneficiary without special needs can obtain more resources as he or she reaches adulthood and can work to meet essential needs, but a child with special needs may never have that ability.
Planning Tip: Parents, grandparents, or any other loved ones of a special needs child face unique planning challenges when it comes to that child. This is one area where the client simply cannot afford to wait to plan.
COSTLY MISTAKE #3: Failure to coordinate a planning team effort.
It is critical that the advisor assisting with special needs planning include in the planning team: an attorney who is experienced in this planning area; a life insurance agent who can ensure that there will be enough money to maintain the benefits for the special needs child; a CPA who can advise on the Special Needs Trust's tax return; an investment advisor who can ensure that the trust fund's resources will last for the child's lifetime; and any other key advisors that may support the goals of the trust going forward.
Planning Tip: Special needs planning dictates that the client's advisors work together to ensure that there are sufficient trust assets to care for the child throughout his or her lifetime.
COSTLY MISTAKE #4: Ignoring the special needs when planning for the child's benefit.
Planning that is not designed with the child's special needs in mind will probably render the child ineligible for essential government benefits. A properly designed Special Needs Trust promotes the special needs person's comfort and happiness without sacrificing eligibility.
Special needs can include medical and dental expenses, annual independent check-ups, necessary or desirable equipment (for example, a specially equipped van), training and education, insurance, transportation, and essential dietary needs. If the trust is sufficiently funded, the disabled person can also receive spending money, electronic equipment & appliances, computers, vacations, movies, payments for a companion, and other self-esteem and quality-of-life enhancing expenses: the sorts of things your clients now provide to their child or other special needs beneficiary.
Planning Tip: When planning for a child with special needs, it is critical that the client utilize a Special Needs Trust as the vehicle to pass assets to that child. Otherwise, those assets may disqualify the child from public benefits and may be available to repay the state for the assistance provided.
COSTLY MISTAKE #5: Creating a "generic" special needs trust that doesn't fit.
Even some "special needs trusts" are unnecessarily inflexible and generic. Although an attorney with some knowledge of the area can protect almost any trust from invalidating the child's public benefits, many trusts are not customized to the particular child's needs. Thus the child fails to receive the benefits that the parent provided when they were alive.
Another frequent mistake occurs when the Special Needs Trust includes a "pay-back" provision rather than allowing the remainder of the trust to go to others upon the death of the special needs child. While these "pay-back" provisions are necessary in certain types of special needs trusts, an attorney who knows the difference can save your clients hundreds of thousand of dollars, or more.
Planning Tip: A Special Needs Trust should be customized to meet the unique circumstances of the child and should be drafted by a lawyer familiar with this area of the law.
COSTLY MISTAKE #6: Failure to properly "fund" and maintain the plan.
When planning for children with special needs, it is absolutely critical that there are sufficient assets available for the special needs beneficiary throughout his or her lifetime. In many instances, this requires utilization of a funding vehicle that can ensure liquidity when necessary. Oftentimes permanent life insurance is the perfect vehicle for this purpose, particularly if the clients are young and healthy such that insurance rates are low.
Also, because this is an ever-changing area, it is also imperative that the clients revisit their plan frequently to ensure that it continues to meet the needs of the special needs beneficiary.
Planning Tip: Clients should consider permanent life insurance as the funding vehicle for special needs beneficiaries, particularly when the beneficiary is young given the often staggering costs anticipated over that beneficiary's lifetime.
If the client may be subject to estate tax, consider having an Irrevocable Life Insurance Trust own and be the beneficiary of the policy, naming the Special Needs Trust as a beneficiary. Alternatively, in a non-taxable situation, consider naming the client's revocable trust as the beneficiary to help equalize inheritances if that is the client's objective.
COSTLY MISTAKE #7: Choosing the wrong trustee.
During your client's life, he or she can manage the trust. When the client is no longer able to serve as trustee, they can choose who will serve according to the instructions that they have provided. They may choose a team of advisors and/or a professional trustee. Whomever they choose, it is crucial that the trustee is financially savvy, well-organized, and, of course, ethical.
Planning Tip: The trustee of a Special Needs Trust should understand the client's objectives and be qualified to invest the assets in a manner most likely to meet those objectives.
COSTLY MISTAKE #8: Failing to invite contributions from others to the trust.
A key benefit of creating a Special Needs Trust now is that the beneficiary's extended family and friends can make gifts to the trust or remember the trust as they plan their own estates. For example, these family members and friends can name the Special Needs Trust as the beneficiary of their own assets in their revocable trust or will, and they can also name the Special Needs Trust as a beneficiary of life insurance or retirement benefits.
Planning Tip: Creating a Special Needs Trust now allows others, such as grandparents and other family members, to name the trust as the beneficiary of their own estate planning.
COSTLY MISTAKE #9: Relying on siblings to use their money for the child with special needs' benefit.
Your client may be relying on their other children to provide for their child with special needs from their own inheritances. This can be a temporary solution for a brief time, such as during a brief incapacity if their other children are financially secure and have money to spare. However, it is not a solution that will protect the child with special needs after your client has died or when siblings have their own expenses and financial priorities.
What if the inheriting sibling divorces or loses a lawsuit? His or her spouse (or a judgment creditor) may be entitled to half of it and will likely not care for the child with special needs. What if the sibling dies or becomes incapacitated while the child with special needs is still living? Will his or her heirs care for the child with special needs as thoughtfully and completely as the sibling did?
Siblings of a child with special needs often feel a great responsibility for that child and have felt so all of their lives. When your clients provide clear instructions and a helpful structure, they lessen the burden on all their children and support a loving and involved relationship among them.
Planning Tip: Relying on siblings to care for a special needs beneficiary is a short-term solution at best. A Special Needs Trust ensures that the assets are available for the special needs beneficiary (and not the former spouse or judgment creditor of the sibling) in a manner intended by the client.
COSTLY MISTAKE #10: Failing to protect the child with special needs from predators.
An inheritance from parents who fund their child's special needs trust by will rather than by revocable living trust is in the public record. Predators are particularly attracted to vulnerable beneficiaries, such as the young and those with limited self-protective capacities. When you plan with trusts rather than a will, your client decides who has access to the information about their children's inheritance. This protects their special needs child and other family members, who may be serving as trustees, from predators.
Planning Tip: A Special Needs Trust created outside of a will ensures that information about the inheritance is not in the public record, protecting the special needs beneficiary from predators.
Planning for special needs beneficiaries requires particular care and the participation of all of the client's wealth planning advisors. A properly drafted and funded Special Needs Trust can ensure that the beneficiary has sufficient assets to care for him or her, in a manner intended by the client, throughout the beneficiary's lifetime.
(Peter G. Lennington, Esq., is a wealth preservation and estate planning member attorney with offices in St. Paul, MN, Bloomington/Edina, MN, and Minnetonka, MN. The Lennington Law Firm, PLLC website is located at www.lennington.com. You can contact Peter G. Lennington via e-mail at firstname.lastname@example.org)