WILLS, TRUSTS & PROBATE
No matter what your age or how many or how few assets you have, properly planning your Estate is critical. More importantly, it is one of the best things you can do for your loved ones. Without the proper estate plan, many important decisions, such as who will take care of your minor children if you die, who will take care of your pets, or even who will take care of you if you become unable to make decisions for yourself, could be left up to a Judge to decide. Contact Attorney Alice M Breding, Esq. now to properly plan your Estate. Whether you need a lawyer to draft a document such as a simple will, or wish to give a loved one power of attorney to make decisions on your behalf in the future, we have the experience and wisdom to help you make the right decisions.
Estate planning and administration can be among the most sensitive issues attorneys can handle on behalf of their clients. A skilled estate planning attorney can help you protect your assets so that they may be passed on with no unnecessary tax liability or familial conflict. An experienced estate administrator implements the procedures that were laid out in the estate plan, when the time comes.
Be assured that the firm will approach your individual needs and goals with the integrity and empathy that you would expect of a firm with our tradition. Our values of cost-effectiveness, attention to detail, and sensitivity govern how we practice law. Whether you have a simple estate with a 401K and a car or a multi-million dollar lakefront home, our lawyers have the talent and training to make sure your wishes are carried out exactly.
Our firm will make use of all available options to minimize your tax liability, and help your family understand what you intended. It is our job to help you plan carefully for the future so that you can enjoy life to the fullest in the present.
• Simple Wills
• Living Wills
• Irrevocable and Revocable Trusts
• Powers of Attorney
• Tax Minimization, including the gift tax and the estate tax
• Asset Protection
• Life Insurance
Why do I need a will?
A will is important for a number of reasons. For one thing, it makes sure that what you own when you die passes to the people you want to benefit from your estate. Additionally, it permits you to select the people who will be in control of your estate, who will be the guardian of any minor children you have and when your children, grandchildren or other younger beneficiaries will have access to money from your estate.
What happens if I die without a will?
New York State law provides that the estate of a person who dies without a will (Intestate) will pass to certain relatives. In the case of a person who is married but has no children at the time of his or her death, the entire estate will pass to the surviving spouse. In the case of a person who is married with children, the estate is divided among the spouse and the children even if the children are minors at the time of death.
This means that the spouse does NOT inherit the entire estate and that he or she will not have access to all funds owned by the deceased spouse. Additionally, children who are minors at the time of the parent's death will have full access to their inheritance when they turn 18, which may or may not be a good idea. The estate of a decedent who is survived by only children will pass to his or her children. In the case of a decedent who is predeceased by one or more children, the share of the predeceased child will pass to the deceased chill's children and so forth.
The law further provides for inheritance by people who are survived by neither spouse nor children and, eventually, if a decedent has no "close" relatives, his or her estate will pass to New York State. Finally, the administrator of the estate of a decedent who dies without a will may be required to post a fiduciary bond, which can be both difficult and costly to the estate.
What does a Health Care Proxy do?
A Health Care Proxy appoints another person to make health care decisions for you in the event you are unable to communicate your own desires or in the event you are deemed incompetent to make decisions for yourself When we draft a health care proxy, we include a "living will" in the document itself so not only does the health care proxy make the appointment of a person to communicate your desires to health care professionals, it also makes clear what your intentions are so that there can be no question about whether life sustaining treatment should be withheld.
The document can and should be tailored to express your individual desires with respect to all aspects of life sustaining treatment and end of life decisions, so our Troy estate planning attorneys encourage you to communicate your desires to the attorney assisting you with your estate planning so that we can be sure that the document that you sign very clearly sets forth your wishes with respect to these matters.
Why is a Power of Attorney important?
In the event you are disabled, injured in an accident or otherwise unable to make decisions on your own behalf a hospital or doctor MAY simply ask your family to make health care decisions for you and MAY abide by those decisions. However, under the same circumstances, your bank or brokerage house will NOT simply listen to your family as to what you may or may not want done with your money.
So, if your family relies upon you for support, they will have no access to your funds to pay house bills, food bills, utility bills or your medical bills. Additionally, if your condition requires that you enter a nursing home, there will be no one available to engage in any Medicaid planning to save some of your assets for your family. A Power of Attorney permits another person to make these financial decisions, gain access to your assets, pay your bills and generally keep your life rolling along.
If you become disabled, injured, are unconscious or otherwise unavailable and you don't have a Power of Attorney, the only option may be to commence a guardianship proceeding against you, which is an expensive and time consuming proposition that could be avoided. New York State made some significant changes to the Power of Attorney statute recently, so we really encourage all of our clients to update this document to make sure that you have granted all of the powers you want your agent to be able to perform in the event it becomes necessary.
What is the difference between a Will and a Living Trust?
A Will only becomes effective at the time of your death, while a Living Trust is established and funded during your lifetime. Typically, when someone refers to a Living Trust, they mean a revocable trust, meaning it can be changed or terminated during the lifetime of the person who created it. While a revocable trust can be an excellent management tool and can be extremely appropriate as an estate planning vehicle for certain people, it is not for everyone and, Wit is used as a tool for "avoiding probate", every single asset that is owned by the decedent individually MUST be transferred into the trust or it loses its effectiveness.
Please note that a Living or Revocable Trust does nothing to protect assets from creditors, including Medicaid, so this type of planning is not appropriate for everyone, depending on the situation and the client's goals.
Who should have a Living Trust?
I strongly recommend revocable trusts for certain types of clients. For those clients that have issues
with managing their assets or who have assets that may lose significant value if there is any lapse in management (ie. between the time of the decedent's death and the time an executor or administrator is appointed for the estate), a revocable trust can be a really useful tool to ensure that there is always someone "at the helm", because a living trust provides for virtually seamless transition from one trustee to the next.
Additionally, for clients that have real property located in another state, a living trust into which the out of state property is transferred can avoid having to probate the will in New York AND in the state in which the property is located. Another class of clients that can significantly benefit from a revocable trust is those that have no close relatives. For example, if a decedent has no spouse, no children, no living parents, no living grandparents, and no siblings, we end up having to contact aunts, uncles and cousins in order to get a will admitted to probate. This can be extremely difficult, especially if we don't know where these individuals are or if they are in another country. For these clients, a revocable trust to which every asset that the client owns is transferred avoids probate completely and eliminates the need to contact people that may not have had contact with the decedent for years.
Does Medicare pay for long term (nursing home) care?
Unfortunately, Medicare does not pay for extended stays in a nursing home. Under certain limited circumstances, however, Medicare can cover some of the cost of staying in a nursing home when you are actively rehabilitating or when medical care is required (i.e. for tracheotomy, wound care, intra venous medications, etc.). In order to receive Medicare coverage for a nursing home stay, admission to the nursing home must follow a hospital stay of at least three days, and either the patient must be actively participating in rehabilitation and getting better or the patient must require nursing (not merely custodial) care. Under those circumstances, Medicare will pay for the first 20 days of a nursing home stay completely, meaning the patient has no obligation to contribute.
Medicare will keep paying part of the cost for days 21 through 100, but the patient is required to pay a copay, which is $144.50 per day for 2012. It is very common for Medicare to terminate coverage after the initial 20 days, usually based on allegations that the client isn't participating or improving with therapy or that he or she no longer requires nursing care.
Does Medicaid pay for long term care?
Yes, but only if the person is not only physically eligible for care in a nursing home, but also financially eligible. It is important to note that this question is only applicable to institutional care and does apply to the requirements for community Medicaid, which is different from Institutional Medicaid. In order to be eligible for Medicaid, a single person can have no more than $14,250 in non-exempt resources. He or she is required to pay all income over to the nursing home on a monthly basis except $50, which can be kept for personal needs.
The spouse of a person in a nursing home can keep all exempt resources (including the house, car and personal property) and can keep financial assets with a value not less than $74,820 or half of the couple's assets up to a maximum of $113,640, whichever is greater. In addition, the community spouse can keep up to $2,841 per month in income. If the patient and family meet these financial eligibility requirements, the institutionalized spouse should be eligible for Medicaid benefits unless he or she (or the spouse) has made an uncompensated transfer (gift) within the 60 months prior to a Medicaid application. In that case, there may be a period in which the patient is not eligible to receive benefits.
It is important to be sure that you are applying for Medicaid at the right time, since applying less than 60 months after a gift may result in an eligibility period of longer than what remains of the 60 months, while submitting the application after the 60 month period is over may result in no ineligibility period at all. Medicaid eligibility is a complicated area of law, and it is better to get help than to try to navigate these waters alone.
What kind of insurance can I get to pay for nursing home care?
New York State has a variety of Long Term Care insurance options, but the options can typically be categorized as either "Partnership" or "Non-Partnership". New York is one of the states that has a partnership between the State and private industry, providing an insurance product that is part private insurance and part government benefit. A policy that meets the standards of the New York State Partnership for Long Term Care must provide a certain minimum standard of benefits and, following the policy period (i.e. three years), the applicant is eligible for Medicaid WITHOUT having to meet the resource guidelines ($14,250 for a single applicant and no more than $113,640 for the spouse of a married applicant).
Medicaid permits the owner of a "partnership" policy to keep all of his or her resources and simply pays for the cost of his or her care after the owner pays all non-exempt income to the nursing home. A non-partnership policy doesn't link with Medicaid, and doesn't meet the minimum requirements of the Partnership policy, however, depending on the needs of the individual, a non-partnership policy may meet your needs better than a partnership policy. New York State has a great guide to Long Term Care Insurance. You can find it at www.dfs.ny.gov/insurance/ltc/ltc guide.pdf.
What can I do to avoid spending all of my money on nursing home care?
There are a number of options for protecting assets from the cost of nursing home care, accelerating Medicaid eligibility, and ensuring that all or some of the money you've saved gets to your children, grandchildren or other beneficiary of your choosing. Unfortunately, most of these options require you to partially or fully divest yourself of control over the money.
Typically, we use a combination of gifts to individuals or trusts and, when necessary, loans, to get a client eligible for Medicaid while protecting as much as we can. The more the client does at least five years prior to needing Medicaid, the more we can do. This is one of those areas in which waiting until the last minute can cost a lot of money.
How far ahead should I plan for Medicaid?/What can I do if I haven't done any planning and I need nursing home care?
Under the current laws, planning at least five years (60 months) in advance ensures that none of the assets you've given away or put in trust will be looked at in determining your eligibility for Medicaid. However, even if you've procrastinated, we can still implement some limited planning to protect some of your assets, including prepaying your funeral, repairing a home in which the community spouse lives and otherwise enhancing the value of your exempt assets by using non-exempt assets. It's not usually too late to do at least something to save some of your money.
Is an "Irrevocable Trust" or "Medicaid Trust" really irrevocable?
Much to Medicaid's dismay, in New York, even an "irrevocable" trust isn't always irrevocable. We are careful to draft our Medicaid trusts with provisions that ensure that, should situations change dramatically in the future, we will be highly likely to be able to revoke or partially revoke the trust to provide our clients with access to the funds. Although we can't guarantee that this will be possible, we take whatever steps are available to make invasion of the trust principle possible in the future.
Does Medicaid cover care at home?
Medicaid does cover care at home, but only under extremely rare and dramatic circumstances that don't apply very often at all to the elderly. Most people don't want to go to a nursing home and would prefer to be cared for at home and a lot of families want to care for their loved ones at home. However, this isn't always possible, even though all parties may have the best of intentions.
If a caregiver gets sick, he or she may no longer be able to keep up with the demands of caring for an elderly parent or spouse. Additionally, there are some types of care that simply can't be provided at home. Home care is expensive, and, unfortunately, most people can't afford to pay for care at home for as long as they might want it. A long term care insurance policy with a home care benefit is the best option for people who want to be cared for at home.