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Elder Law

What is a Bypass Trust?

By Asset Protection Planning, Estate Planning, Tax Law

An estate planning tool that couples have utilized for years is the bypass trust. The trust is a long-term planning device that allows a spouse to leave property that will not be subject to estate taxes when he or she passes away.

For couples that plan their estates together, they can make sure that the property will be taxed only once between the two of them by leaving it in a bypass trust. In order to keep the trust from being taxed when your spouse dies, you must ensure two provisions in your documents—you must limit your spouse’s power to access the trust during his or her lifetime and you must restrict your spouse’s power to distribute assets upon his or her death.

These conditions must be in place to satisfy the rules set up by the IRS. However, you may give your spouse the right the withdraw principle for his or her health, education, and support. You can also appoint him or her as trustee of the bypass trust. While your spouse is not allowed to give the assets to himself, his estate, or his estate’s creditors, you can grant him the right to name specific individuals in his will who will succeed to the trust upon his death.

November 11, 2016
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Sharing Caregiving Responsibilities with Siblings

By Long-Term Care

According to a U.S. News & World Report article called “Dividing the Caregiving Responsibilities Between Siblings,” it is common for members of the baby boomer generation to find themselves caring for their parents, financially and emotionally. While historically the eldest daughter may have been the one traditionally left with these responsibilities, these circumstances are changing with women’s advancement in the workplace and the geographical space between families.

In order to divide the responsibilities of caring for parents between siblings, there are certain steps families should follow. Despite most families living in different locations, there are ways for siblings living away from elderly parents to help. They can call parents regularly, pay bills online, or make visits here and there.

November 8, 2016
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What is an Incentive Trust?

By Asset Protection Planning, Estate Planning

An Incentive Trust is a tool used to encourage certain positive behavior in beneficiaries. Some of this behavior may include earning a college degree, maintaining employment, or abstaining from drug or alcohol use. Typically, the beneficiary would be paid a certain amount from the trust upon completing those obligations, or the trust would match a dollar of income for every dollar the beneficiary earns.

Oftentimes, the incentives included in the trust can include specifications such as maintaining a certain grade point average or passing a drug test. Also, you can encourage beneficiaries to participate in charitable activities so money could be distributed for working for a foundation.

While incentive trusts can encourage good behavior, they can also impose rigid rules that could end up working to the detriment of your beneficiaries.

November 4, 2016
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Can conveyance of property by Lady Bird deed avoid subjecting the property to probate?

By Asset Protection Planning, Estate Planning, Probate

A big advantage of signing a Lady Bird deed is that it avoids probate of the property after you pass away. In many states, including Florida, there is a Medicaid estate recovery program that seeks reimbursement from probate assets if you received benefits during your lifetime. But with a Lady Bird deed, the property is considered a nonprobate estate and the beneficiaries can inherit the property without having to reimburse the government for Medicaid benefits that you might have received.

November 1, 2016
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Is the conveyance of a Lady Bird deed an improper gift if made during the Medicaid “look-back” period?

By Asset Protection Planning, Estate Planning, Medicaid Planning

When applying for Medicaid, the government will review transfers the applicant made during a so-called “look-back” period, which includes the assets you’ve given away during the previous years. Giving away property to relatives and loved ones could compromise your eligibility for receiving benefits. However, by signing a Lady Bird deed, you are not required to disclose these transfers to Medicaid.

October 28, 2016
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What are the Advantages of a Lady Bird Deed?

By Asset Protection Planning, Estate Planning

By signing a remainder deed with a reserved life estate, a grantor is able to designate a beneficiary to inherit her property while the grantor maintains ownership during her lifetime. A traditional life estate deed prohibits the grantor from selling, mortgaging, gifting, or terminating property. However, in states like Florida, there is an alternative to a life estate deed known as an enhanced life estate deed, or a Lady Bird deed.

Unlike a traditional life estate deed, a Lady Bird deed allows the grantor to continue to control the property without the consent of the beneficiaries. The landowner is free to sell the property, profit from the property, and make gifts that won’t jeopardize the landowner’s eligibility for Medicaid.

October 25, 2016
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Is a Third-Party Supplemental Needs Trust right for you?

By Asset Protection Planning, Estate Planning, Government Benefits

While a first-party supplemental needs trust is designed to allow a disabled beneficiary place their own funds or assets in a trust, a third-party supplemental needs trust is meant for family members to assist a person with disabilities.

Just like a first-party supplemental needs trust, the assets in the third-party trust do not jeopardize the beneficiary’s eligibility for Supplemental Security Income (SSI). A third-party supplemental needs trust can hold any assets that the family wishes to provide (e.g. stocks, bonds, houses, etc.). Rather than giving the disabled individual the funds directly, the family can transfer them to the trust in order to provide a benefit to the beneficiary while not disqualifying the beneficiary from receiving government benefits.

While the beneficiary of the first-party supplemental needs trust must be below the age of 65, the age of the beneficiary does not matter for a third-party supplemental needs trust. Another key difference is that there is no payback requirement for a third-party supplemental needs trust. This means that when the beneficiary passes away, the remaining assets in the trust can be passed to relatives or charity instead of being used to reimburse the government.

If you have further questions on this topic or wish to set up a third-party supplemental needs trust, contact our office at (941) 906-1231 to schedule an appointment with one of our attorneys.

October 21, 2016
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Is a First-Party Supplemental Needs Trust right for you?

By Asset Protection Planning, Estate Planning, Government Benefits

A first-party supplemental needs trust is created to allow disabled persons to receive the benefit of their funds in a trust while still qualifying for and receiving government benefits. An alternative to this trust is a pooled trust. A pooled trust is created by a non-profit organization, and individual beneficiaries can create accounts within the trust.

By pooling the assets of disabled persons, the organization can manage one master trust and maximize the benefits for the beneficiaries. The non-profit can make more stable investments and provide more services than a normal supplemental needs trust.

Most people with special needs join a pooled trust when they do not have anyone to create a first-party supplemental needs trust for them. And just like a first-party supplemental needs trust, a pooled trust is used for people to qualify for and remain eligible to receive government benefits, such as Medicaid and SSI.

A couple advantages of a pooled trust are the low costs and the fact that the funds will be used to help others with disabilities.

If you have further questions on this topic, contact our office at (941) 906-1231 to schedule an appointment with one of our attorneys.

 

October 18, 2016
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How to Vote While Living in a Nursing Home

By Elder Law, Long-Term Care

Voting is an important facet of democracy, but for many seniors, it can become increasingly difficult to get to the polls. For seniors who live in nursing homes, it can be even more challenging.

While it is necessary in Florida to physically cast a ballot, Florida allows absentee voting. The requirements for absentee voting vary by state, and some states require an excuse such as a physical disability to vote absentee. However, Florida and 36 other states do not require an excuse. A form of absentee voting used by 23 states, including Florida, is mobile polling. Mobile polling allows residents to vote from within their facility. To access mobile polling, contact your local elections office. Florida also offers supervised voting for absent electors. The supervisor of elections, pursuant to 101.65, F.S., is required to provide supervised voting at nursing homes if requested by the facility. Teams of at least two people, representing at least two parties, are provided for assistance. The senior can receive help from the supervised voting team or a person of the elector’s choice to cast the ballot.

Florida and 36 other states also allow early voting for those who can’t make it on Election Day. Early voting allows voters to visit an election office early without having to provide an excuse. In Florida, you can also receive personal help during early voting without having to explain the extent of your disability.

October 14, 2016
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What is the Medicaid Estate Recovery Program?

By Estate Planning, Government Benefits, Medicaid Planning

If individuals receive Medicaid benefits during their lifetimes, Medicaid may have a claim against their estates for any amount spent on the recipient. This is called the Medicaid Estate Recovery program. The program, which operates on a state and federal level, is designed to recover the assistance payments from the assets in the estate.

Estate recovery applies to anyone who received government benefits and were age 55 years or older at the time of their death. The law requires that the personal representative or attorney of the estate send a copy of the death certificate to the Agency for Health Care Administration to determine whether Medicaid provided assistance. If so, a claim is then filed with the probate court.

The main targets of this program are nursing home residents who were also Medicaid recipients during their lifetime. If the Medicaid recipient leaves behind a spouse, a child under the age of 18, or a blind/disabled child, the estate recovery does not apply.

Bach & Jacobs, P.A. provides assistance to personal representatives and trustees who are responsible for administering estates and trusts. If you have been named as a personal representative or trustee for someone who has recently died, contact our firm for a consultation with one of our attorneys.

October 11, 2016
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