Trusts and asset protection

ADDITIONAL INFORMATION:

Trust language specifies that after main beneficiary dies that the two remainder beneficiaries can receive their share as a total distribution after they reach age 25 if they request it. So they have the option of keeping some or all of their share in the trust per their request. Does this language offer the beneficiaries asset protection from divorce or creditors? If not, can anything be done to provide asset protection? The trust is irrevocable since the grantor is deceased.

ANSWER BY MARGARET CROSS-BELIVEAU:

If a Trustee is required to pay over assets when a beneficiary requests, then there is no asset protection. Those assets are the beneficiary’s. The beneficiary should consult an estate planning attorney of his own. [Read more…]

Proving the hardship exception to the Medicaid penalty period

If you transfer assets within five years of applying for Medicaid, you will likely be subject to a period of ineligibility. There is an exception, however, if enforcing the penalty period would cause the applicant an “undue hardship.” This exception is difficult to prove and rarely granted, but it may be available in certain circumstances.

Under federal Medicaid law, the state Medicaid agency must determine whether an applicant transferred any assets for less than fair market value within the past five years. If there are any transfers, the state imposes a penalty period, which is a period of time in which the applicant will be ineligible for Medicaid benefits. The length of the penalty period is calculated by dividing the amount transferred by what Medicaid determines to be the average private pay cost of a nursing home in the state.

A Medicaid applicant can fight the penalty period by arguing that enforcing it will cause an undue hardship. Federal law provides that an undue hardship exists if the penalty period would deprive the applicant of: (1) medical care necessary to maintain the applicant’s health or life; or (2) food, clothing, shelter, or necessities of life. The burden is on the applicant to prove that hardship exists. A nursing home can pursue a hardship waiver on behalf of a resident. [Read more…]

Family dispute illustrates need for long-term care plan

A recent New Jersey court case demonstrates how important it is for families to come up with a long-term care plan before an emergency strikes.

The case involved two brothers who got into a fight over whether to place their mother in a nursing home. R.G. was the primary caregiver for his parents, as well as their agent under powers of attorney. After R.G.’s mother fell ill, R.G. wanted to place her in a nursing home. R.G.’s brother objected, but R.G. went ahead and had his mother admitted to a nursing home without his brother’s consent. R.G.’s brother sent angry and threatening texts and emails to R.G. as well as emails expressing his desire to find a way to care for their parents in their home. Eventually the men got into a physical altercation in which R.G.’s brother shoved R.G.

R.G. went to court to get a restraining order against his brother under New Jersey’s Prevention of Domestic Violence Act. A trial judge ruled that R.G. had been harassed and assaulted and issued the order. But a New Jersey appeals court reversed the trial court, ruling that R.G.’s brother’s actions did not amount to domestic violence. According to the court, there was insufficient evidence that R.G.’s brother purposely acted to harass R.G. [Read more…]

Use your will to dictate how to pay your debts

The main purpose of a will is to direct where your assets will go after you die, but it can also be used to instruct your heirs on how to pay your debts. While generally heirs cannot inherit debt, an estate’s debt can reduce what they receive. Spelling out how debt should be paid can help your heirs.

If someone dies with outstanding debt, the executor is responsible for making sure those debts are paid. This may require selling assets that you would have preferred to leave to specific heirs. There are two types of debts you might leave behind:

  • Secured debt is debt that is attached to a piece of property or an asset, such as a car loan or a mortgage.
  • Unsecured debt is any debt that isn’t backed by an underlying asset, such as credit card debt or medical bills.

[Read more…]

How Medicare and employer coverage coordinate

Medicare benefits start at age 65, but many people continue working past that age. That makes it important to understand how Medicare and employer coverage fit together.

Depending on your circumstances, Medicare is either the primary or the secondary insurer. The primary insurer pays any medical bills first, up to the limits of its coverage. The secondary insurer covers costs the primary insurer doesn’t cover (although it may not cover all costs). Knowing whether Medicare is primary or secondary to your current coverage is crucial because it determines whether you need to sign up for Medicare Part B when you first become eligible. If Medicare is the primary insurer and you fail to sign up for Part B, your eventual Medicare Part B premium could start going up 10 percent for each 12-month period that you could have had Medicare Part B but did not take it.

Here are the rules governing whether Medicare coverage will be primary or secondary: [Read more…]

Four provisions people forget to include in their estate plan

Even if you’ve created an estate plan, are you sure you have included everything you need to? There are certain provisions that people frequently forget to put in in a will or estate plan that can have a big impact on their heirs.

  1. Alternate beneficiaries

One of the most important things an estate plan should include is at least one alternative beneficiary in case the named beneficiary does not outlive you or is unable to claim under the will. If a will names a beneficiary who isn’t able to take possession of the property, your assets may pass as though you didn’t have a will at all. This means that state law will determine who gets your property, not you. By providing an alternate beneficiary, you can make sure that the property goes where you want it to go.

  1. Personal possessions and family heirlooms

Not all heirlooms are worth a lot of money, but they may have sentimental value. It is a good idea to be clear about which family members should get which items. You can write a list directly into your will, but this makes it difficult if you want to add or remove items. A personal property memorandum is a separate document that details which friends and family members get which personal property. In some states, if the document is referenced in the will it is legally binding. Even if the document is not legally binding, it is helpful to leave instructions for your heirs to avoid confusion and bickering. [Read more…]

Executor for will

ADDITIONAL INFORMATION:

I have been named as executor for my parent’s will. For many years I have been his full time caregiver. I have few assets and basically no credit history. He left a house and a summer cottage. I am thinking it would be much better for my brother who has an excellent credit history and assets to become executor. I doubt I could be bonded as executor. Any advice/thoughts greatly appreciated.

ANSWER BY MARGARET CROSS-BELIVEAU:

In Massachusetts and in several other states (but not all), the bond requirement can be waived in the will and the court will honor the request.  If the assets are located in a state which will not waive the bond, you have to option of declining to serve as the personal representative.  The person who is nominated after you in the will may then serve, or in no one is nominated, the next of kin (your brother) may petition the court to be appointed.
[Read more…]

Can workers compensation put a lien on law suit money ?

ADDITIONAL INFORMATION:

I’m on workers compensation and I’m suing the people responsible for it. Is workers compensation entitled to some of the money?

ANSWER BY MARGARET CROSS-BELIVEAU:

Yes, worker’s compensation is entitle to recover money it advanced to you.  Your attorney may be able to negotiate a lien reduction.

Legal Disclaimer: Please note that this answer does not constitute legal advice, and should not be relied on since each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship. A lawyer experienced in the subject area and licensed to practice in the jurisdiction should be consulted for legal advice.

Beliveau Law Group: Massachusetts | Florida | New Hampshire

The litigation attorneys at the Beliveau Law Group provide legal services for probate, estate administration, and trust administration. The law firm has offices and attorneys in Naples, Florida; Waltham, Massachusetts; and Salem, New Hampshire.

Stepmother did a lady bird deed to her son and cut us right out of the will . 2 weeks after fathers death

ADDITIONAL INFORMATION:

My dad passed away in 2014 . He had a will and stepmom had a will both basic mirror wills . My dad actually gave me copies of both and it named me executor in both of there wills . Before my dads death he called me up very upset he lived in Florida said I’m going to my bank and changing you to beneficiary . He said stepmom and stepson are aggravating him because he wants to move in and my dad couldn’t stand him . I was like dad relax I was busy driving told him I would call him back . The next day I get a call my dad fell but he’s OK. He should be home the next day I was told by them. Had I known he was in grave condition I would’ve flown there right away. They lied to me. I called the hospital and stepmom instructor that no information is to be given out. I explained I had a healthcare proxy. At that time I got a call saying he was unconscious and not waking up . I was very suspicious also by the time I got my flight he had passed they robbed me of being able to say goodbye. When I found out he passed I collapsed I need an ambulance and never made the trip there. Their behavior got more suspicious when she called to say she was going to ship my father’s ashes me .2 weeks later [Read more…]

How does a living trust work?

ADDITIONAL INFORMATION:

I spoke to an elder care attorney about my mother going into a nursing home. I told him I have POA, healthcare surrogate and Will with me as executor. I had concerns about my mother’s home. My sister has been caring for her in our mother’s home for 4 years. She has Alzheimer’s and it’s time for her to be in a nursing home. He advised me what paperwork to get together and that she needs a living trust where her monthly income goes into I’m assuming to pay her portion of the nursing home but why can’t it just be her bank account and why $2500 for him to set it up?

ANSWER BY MARGARET CROSS-BELIVEAU:

Florida is an income cap state for Medicaid. It sounds like your mother has too much income to qualify for Medicaid. In which case, a trust must be set up to capture the excess income. It will be turned over to the state after she passes away. The other part of her income will be paid to the nursing home as her patient pay amount.  Also, in Florida, Medicaid can’t place a lien on an applicant’s homestead.  The home will not be placed in the trust.
[Read more…]