Are You Taking the Steps Towards Legal Estate Planning For Your Loved Ones?

Without proper legal estate planning, caring for aging loved ones is often emotionally and financially distressing for everyone involved. Families struggle at the last minute to find information, guidance and assistance to handle the complex health care financial and legal needs.

By planning ahead and obtaining the right legal documents, families can help their aging relatives gain security, take advantage of public benefits and preserve their assets.

First, estate plans are key. They can help families avoid probate, which occurs when an individual owns assets in his or her name alone, and the court determines distribution. If not handled properly, probate can be time-consuming and costly while providing no privacy for the family.

What does Estate Planning Include?

Estate planning includes wills or trusts, durable powers of attorney, health-care surrogate designations, and living wills. These documents enable individuals to manage their assets during their lifetime and upon incapacity as well as after death. Estate planning can help minimize or avoid estate taxes and ensure the senior – not the state – retains control of his or her assets.

If nothing else is done, individuals should obtain advance directives. These documents help ensure their wishes are carried out (financially and medically) in the event of their incapacity.

In Estate Planning, Advance Directives Should Include:

Living Wills – Documents an individual’s wishes concerning prolonging life through artificial means when there is no other hope of recovery.

Health-Care Surrogate – Grants an individual’s designee the power to access medical information otherwise prohibited by HIPAA.

Durable Power of Attorney – Gives an individual the power to direct the giving of gifts, apply for Medicaid, pay expenses, access retirement benefits and sell real estate.

Without these documents, a guardianship will likely be required. In addition to being costly, guardianships enable the judges – not the family members – to make critical decisions. In addition, guardianship courts hesitate to “gift away” a ward’s assets for medical planning.

Families should work with trusted legal experts with experience handling elder law issues. Obtaining the right legal documents can eliminate the stress of caring for aging loved ones and give families a priceless asset: peace of mind.

Terry Abrams Berger is an attorney who practices elder law with the Florida-based firm of Abrams Berger, P.A. She is dedicated to serving the needs of the elderly and their families nationwide. For more information, call 1 (866) 930-0900 or visit www.abramsberger.com

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What are the Top 8 Mistakes People Make with Medicaid Planning?

8 Medicaid Planning Mistakes Are:

1. Thinking it’s too late to plan.

It’s almost never too late to take medicaid planning steps, even after a senior has moved to a nursing home.

2. Giving away assets too early.

First, it’s your money (or your house, or both). Make sure you take care of yourself first. Don’t put your security at risk by putting it in the hands of your children. Precipitous transfers can cause difficult tax and Medicaid problems as well.

3. Ignoring important safe harbors created by Congress.

Certain transfers are allowable without jeopardizing your Medicaid planning eligibility. These include: transfers to disabled children, caretaker children, certain siblings and into trust for anyone who is disabled and under age 65; a transfer to a “pay-back” trust if under age 65; and a transfer to a pooled disability trust at any age.

4. Failing to take advantage of protections for the spouse of a nursing home resident.

These protections include the purchase of an immediate annuity, petitioning for an increased community spouse resource allowance, and in some instances petitioning for an increased income allowance or refusing to cooperate with the nursing home spouse’s Medicaid application.

5. Applying for Medicaid Planning too early.

This can result in a longer ineligibility period in some instances.

6. Applying for Medicaid Planning too late.

This can mean the loss of many months of eligibility.

7. Not getting expert help.

This is a complicated field that most people deal with only once in their lives. Tens of thousands of dollars are at stake. It’s penny wise and pound foolish not to consult with people who make their living guiding clients through the process.

8. Confusion about the difference between lifetime liens on property and estate recovery.

There are a number of exceptions to lifetime liens on property, but for estate recovery there is only a deferral for a surviving spouse and a hardship waiver.

Terry Abrams Berger is an attorney who practices elder law with the Florida-based firm of Abrams Berger, P.A. She is dedicated to serving the needs of the elderly and their families nationwide. For more information, call 1 (866) 930-0900 or visit www.abramsberger.com

Other related articles on medicaid planning see Estate Planning