Posted tagged ‘long term care’

Basic Estate Planning Seminar With Extended Q&A Format

July 5, 2012

LocationMatrix Corporate Center, Sunset Vista Room, Fourth Floor, 39 Old Ridgebury Road, Danbury, CT

Directions:  Directions to Chipman MazzuccoDon’t rely on your GPS.  Please read and follow these directions.

Date:  July 26, 2012

Time:  5:30 to 7:30 pm (Doors open at 5:00)

Register here:  Seminar Registration.  Or, call 203-744-1929 for reservations.  For more contact information, go to the end of this post.  

No admission charge.  Our seminars are always strictly educational.

Description

We will cover the topics listed below.  Each listed Part corresponds to a Part in our Basic Estate Planning Video which you can see on YouTube here:  Basic Estate Planning Video.  If you would like to have the video on DVD, please let us know and we will send you one.

The Seminar will have four sections.  Each section will summarize topics covered in the video.  Q&A will follow each section.

To get the most out of the seminar, attendees should view the whole video before attending.  We understand that time may not permit that, however, and we are structuring the program to make certain it will be well worth your time even if you do not view the video.

Send Us Your Questions

If you think of a question before the seminar, let us know right away before you forget.  If the question is appropriate for a group educational program, we will try to answer it during the program.  Send your questions here: rsl@danburylaw.com (Richard S. Land) or here ksg@danburylaw.com (Kasey S. Galner).

 Seminar Topics

Part 1:  Introduction.  Wills and probate property vs. nonprobate property.

Part 2: Beneficiaries, mistakes with nonprobate property, trust basics, guardian appointments, life insurance beneficiary designations, and estate taxes.

Part 3:  Wills, the estate taxation of life insurance death benefits, tax issues and asset protection issues relating to Wills, and disclaimer Wills.

Part 4: Formula marital deduction Wills, exemption trusts, risk of disinheriting the surviving spouse as estate tax exemptions increase, the portable estate tax exemption, and asset protection bypass trusts.

Part 5:  Formula marital deduction Wills (and exemption trusts) vs. disclaimer Wills (and disclaimer trusts), and common estate planning mistakes.

Part 6:  Common estate planning mistakes continued, the duties of an Executor, the duties of the Trustee, the duties of a guardian, planning for post-death cash needs, and the generation skipping tax.

Part 7: Retirement plan accounts (IRAs, 401(k) plans, 403(b) accounts, etc.), estate taxation on retirement plan accounts, the risk of a circular tax on tax problem at death of account owner, life insurance and irrevocable life insurance trusts as a solution.

Part 8: Retirement plan accounts and related income tax issues, effects of beneficiary designations on deferral periods, spouse as beneficiary and tax deferred rollovers, required minimum distributions, and tax treatment of inherited IRAs, and the five year payout rule.

Part 9: Revocable living trusts, the living trust as a Will substitute, probate avoidance, planning for incapacity, and establishing a revocable living trust.

Part 10:  Comparison of revocable living trust plan with non-living-trust plan, treatment of lifetime issues, powers of attorney as an alternative to the revocable living trust, and what it means to avoid probate.

Part 11:  Comparison continued, avoiding ancillary probate in other states where real property is located, creditors’ claims and safe harbors for the Executor, and income and estate taxes.

Part 12:  Comparison (continued), accounting requirements, releases from liability, continuing trusts and continuing probate court jurisdiction, reasons for considering revocable living trusts, management during incapacity, and real property in other jurisdictions.

Part 13:  Reasons for considering a revocable living trust (continued), controversial estate plans, probate notice requirements, disruption of support for third parties, probate and related delays, simplifying estate settlement for survivors, nonreasons for considering revocable living trusts, the living trust as tax neutral, and probate court fees.

Part 14: Gift planning, gift and estate tax exemptions, exclusions for small gifts, gifts to education funds (529 plans), exclusions for qualified tuition and medical costs, gift tax marital deductions,  gifts to U.S. citizen spouse, and gifts to noncitizen spouse.

Part 15: Gifts of life insurance policies, incidents of ownership, irrevocable trusts as owner, three year rule relating to transfers of life insurance policies, and sophisticated gift techniques (qualified personal residence trusts, grantor retained annuity trusts, valuations for gift tax purposes, gifts to charities and charitable trusts).

SEMINAR LOCATION AND TIME

The seminar will be on July 26, 2012, at the Matrix Corporate Center, Sunset Vista Room, Fourth Floor, 39 Old Ridgebury Road, Danbury, Connecticut from 5:30 p.m. to 7:30 p.m. The doors will open at 5:00. Refreshments will be served.

These seminars are always well attended and space is limited. If you wish to attend, or if others you know are interested in attending, to reserve space call us (203-744-1929) or send an e-mail message to me (Richard Land at rsl@danburylaw.com) or Kasey Galner (at ksg@danburylaw.com) or Lynn D’Ostilio (at lsd@danburylaw.com) containing your name, number attending, telephone number and e-mail address.

You may also register here: Seminar Registration.

 Posted on 7/4/2012 by Richard S. Land, Member, Chipman, Mazzucco, Land & Pennarola, LLC.

Notice: To comply with U.S. Treasury Department rules and regulations, we inform you that any U.S. federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction, tax strategy or other activity.

We frequently post articles relating to estate planning, estate settlement and elder law issues to this blog. We also post notices about our client seminars here. When we do, we send out notices to clients and friends of the firm. If you would like to get our notices, please join our mailing list by clicking below.

Planning Question and Answer Sessions. Please Take This Survey!

May 15, 2012

When Do You Want an Estate Planning Q&A Session?  Please take this survey.

 May 15, 2012.

We recently published a Basic Estate Planning video on YouTube and DVD.  We hope that you will have a chance to see it if you have not already done so.

You can see the YouTube version here:  Basic Estate Planning Screencast on YouTube

We are scheduling group meetings so that interested parties can ask questions related to the subjects in the video.  There will be no charge or obligation. 

Location: Chipman Mazzucco, Attorneys, Matrix Corporate Center, 39 Old Ridgebury Road, Suite D-2, Danbury, Ct. o6810.

We ask you to click on the link below to complete this survey so that we know what will be convenient for you.  It will take only one minute.

Survey Link

 
Thank you for participating in the survey.  It will be a great help to us in our efforts to help you.
 
 
Posted on 5/15/2012 by Richard S. Land, Member, Chipman, Mazzucco, Land & Pennarola, LLC.

Notice: To comply with U.S. Treasury Department rules and regulations, we inform you that any U.S. federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction, tax strategy or other activity.

We frequently post articles relating to estate planning, estate settlement and elder law issues to this blog. We also post notices about our client seminars here. When we do, we send out notices to clients and friends of the firm. If you would like to get our notices, please join our mailing list by clicking below.

     
  Join Email List  
     

Chipman Mazzucco | Promote Your Page Too

 

Seminar Podcast/Slide Presentation (December 8, 2011)

December 26, 2011

Background

On December 8 we made an estate planning presentation to clients,  friends of the firm, and our new neighbors at the Matrix Corporate Center.  The title:  Planning Your Whole Estate (Coordinating Life Insurance, Employee Benefits and Other Nonprobate Property with the Rest of Your Estate Plan).

A question and answer period followed.  One of the more challenging questions, relating to the ability to roll over  lump sum distributions from retirement plans, inspired a post that you can find here:  Lump Sum Rollover of Retirement Account Not as Simple as Expected.

Although a podcast/slide show is not quite as effective (you miss out on the questions and answers) or fun (you miss out on the food, refreshments and good-natured conversation) as the actual in-person presentation, we thought those who could not attend might appreciate the podcast/slide show as presented below in eight parts. 

The Podcast/Slide Presentation

We hope you find the presentation helpful.

Planning Your Whole Estate Part 1 (your will; probate property vs. nonprobate property)

Planning Your Whole Estate Part 2 (common estate planning mistakes; life insurance beneficiary designations; trusts; guardianships; “in trust for accounts”, retirement accounts; joint property; protection from long term care costs; simple wills)

Planning Your Whole Estate Part 3  (jointly owned property; “in trust for” accounts; life insurance beneficiary and ownership)

Planning Your Whole Estate Part 4 (taxation of life insurance; retirement plan accounts; special tax problems relating to individual retirement accounts and other similar accounts)

Planning Your Whole Estate Part 5 (continuation of special tax problems relating to individual retirement accounts and other similar accounts)

Planning Your Whole Estate Part 6 (continuation of special tax problems relating to individual retirement accounts and other similar accounts; trusts as beneficiary of IRA; beneficiary designation forms)

Planning Your Whole Estate Part 7 (revocable living trusts; reasons to consider: asset management during disability and probate avoidance)

Planning Your Whole Estate Part 8 (continuation of issues relating to revocable living trusts including bogus reasons for revocable living trusts)

We hope you will join us at our next seminar.  If you would like to attend, join our email list by clicking on the button below.

Posted on 12/26/2011 by Richard S. Land, Member, Chipman, Mazzucco, Land & Pennarola, LLC.

Notice: To comply with U.S. Treasury Department rules and regulations, we inform you that any U.S. federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction, tax strategy or other activity.

We frequently post articles relating to estate planning, estate settlement and elder law issues to this blog. We also post notices about our client seminars here. When we do, we send out notices to clients and friends of the firm. If you would like to get our notices, please join our mailing list by clicking below.

     
  Join Email List  
     

Chipman Mazzucco | Promote Your Page Too

Special Needs Trusts

August 6, 2010

Trust management for the inheritance of a disabled beneficiary can be very important. In addition to providing benefits and management for the disabled beneficiary’s inheritance, the goals of such a trust usually include protection of the trust assets from the beneficiary’s creditors and exclusion of the trust assets from consideration if the beneficiary needs to apply for government aid (for example, Medicaid to pay the costs of long term care). When we refer to a Special Needs Trust, we are referring to a trust established to accomplish such goals.

As discussed here, in order for a disabled person to become eligible, and remain eligible, for government benefits like Medicaid and Supplemental Security Income (SSI), the person must meet strict income and asset criteria. The Connecticut Department of Social Services (“DSS”) takes into account all “countable assets” when determining eligibility for benefits. Even after approval for these benefits, any changes in assets or income, even from an inheritance, can disqualify the person from the assistance he or she needs.

DSS considers a trust created for general maintenance and support as a countable asset for Medicaid purposes. On the other hand, a trust created strictly for supplemental needs, if drafted properly, will not be counted and can be a way to provide additional support to family members who rely on government benefits. The main question is whether a trust is a general support trust (counted as an asset) or a supplemental needs trust (not counted).

The answer depends upon what the person who created the trust intended to create. This may sound simple enough, but even if a Will says, “This trust is intended to be a supplemental needs trust,” the court may still find that it is, in fact, a general support trust. The courts look at the language of the trust instrument in its totality to determine the testator’s intent.

The courts weigh most heavily the amount of discretion the Trustee has over trust distributions. In order for a trust to qualify as a supplemental needs trust, the Trustee must have complete discretion over the trust payments including the discretion not to make distributions to the beneficiary. Seemingly harmless attempts to include standards for the exercise of discretion can result in the creation of a general support trust instead of a supplemental needs trust. If a trust includes guidelines regarding the Trustee’s exercise of discretion, the guidelines should be merely precatory—in the nature of expressing a mere “fond hope,” “wish” or “desire.” Any guideline or instruction that is more definite may limit Trustee discretion with the result of jeopardizing the goals mentioned above.

In the case of Zeoli v. Commissioner of Social Services, the Court held that the Trustee had “absolute and uncontrolled discretion,” over any and all distributions. As a result, the trust assets were not countable in determining eligibility for aid. In more recent decisions, like the decision in Rome v. Wilson-Coker, the Court seemed to suggest that “unfettered” should be added to the “absolute and uncontrolled” standard the Zeoli court used.

For instance, whenever a trust has only one beneficiary and the instructions provide that distributions are to be made for the beneficiary’s “best interest and general welfare” or that the trust assets may be used to support the beneficiary in “reasonable comfort,” the Court may hold that the Trustee’s discretion is not unlimited and that it would be an abuse of discretion for the Trustee to withhold payments when needed for general support. In that case, the trust would fail to achieve the intended goals. This was the approach taken by the Rome Court.

Unlike the Rome case, the Zeoli case involved a trust with more than one beneficiary. Its holding suggests that a Special Needs Trust should include multiple trust beneficiaries while giving the Trustee the ability to benefit one beneficiary and exclude others. The beneficiary’s case is even stronger if the terms of the trust provide that the trust is intended to be a supplement to, rather than a substitute for, other resources.

A Special Needs Trust for a surviving spouse must be established under the terms of a Will (not a revocable trust). Even if the trust for the surviving spouse satisfies all the requirements suggested by the Zeoli and Rome cases, if the trust is established under the terms of the revocable trust agreement of the deceased spouse (instead of under the terms of the Will of the deceased spouse), the trust will be considered a countable asset and disqualify the surviving spouse for Medicaid benefits to pay the costs of long term care. Accordingly, if the goals of a Special Needs Trust for the benefit of a surviving spouse are to be achieved, the trust must be established under the terms of a Will; the Probate Court and the probate process must become involved.

Unfortunately, many people have been frightened into believing that the probate process is something that must be avoided at all costs. As a result, they have used revocable lifetime trusts as the primary vehicle for disposing of their assets at death. If the intention of the revocable trust is to create a Special Needs Trust for the benefit of a surviving spouse, however, it will fail to accomplish the intended goals.

A Special Needs Trust can be an essential tool to enhance the life of its disabled beneficiary who is relying on government assistance programs.  If drafted improperly, trust assets may be depleted rapidly leaving the beneficiary completely dependent upon an impersonal welfare system which is vulnerable to change at any time.

Posted on 8/6/2010 by Kasey S. Galner, Associate, Chipman, Mazzucco, Land & Pennarola, LLC.

Elder Law—Basics of Planning for Incapacity

January 5, 2010

Caution: The following applies to residents of Connecticut and reflects the law as it exists on January 1, 2010. The law relating to long term care frequently changes. Before any planning decisions are made and implemented, it is important to consult with a professional who keeps current on changes in the law and policies of the agencies that administer long term care programs.

Delegating Authority to Caregivers

If you become incapable without the necessary documents in place, the court will have to become involved and appoint someone to act on your behalf. Three documents can minimize the need for court involvement when you are no longer able to make decisions for yourself.

1. Durable Power of Attorney

The durable power of attorney is a document in which you designate one or more people to act as your agent (to pay your bills, manage your finances, etc.) if you become incapacitated. It is important to note that even if you already have a durable power of attorney in place, banks and financial institutions may be hesitant to accept old documents. Therefore, you should re-execute your power of attorney every couple of years to ensure it will be effective when you need it.

2. Health Care Instructions (“Living Will”)

Your Health Care Instructions (frequently called an Advance Directive or “Living Will”) is a document in which you designate someone to make health care decisions on your behalf if you become incapacitated. It can include instructions about life support, end of life decisions, and organ donation.

3. Designation of Conservator

If, for any reason, the previous two documents are deemed invalid, the court will look at your Designation of Conservator to see whom you have chosen to be the agent of your property and your person when you are incapacitated.

Planning for Long Term Care Costs

Most U.S. residents will need home care or nursing home care (or both) during the course of life. Many people, however, are unaware of the actual cost of long term care services. For instance, the average monthly cost for nursing home care today is $9,959 ($119,508 annually). The actual costs of more desirable nursing homes will be quite a bit more. Without proper planning, you may find yourself in a difficult situation when you or your spouse need long term care.

1. Medicare (Not a Solution)

A common misconception is that Medicare will cover the cost of long term care. While Medicare will cover some nursing home care (up to 100 days only) and home care for acute needs, it will not cover you indefinitely. After 100 days in a nursing home or after your acute needs are met through home care, you will have to find another way to pay for your long term care needs.

2. Medicaid (Provider When Assets Exhausted)

Another common misconception is that when you need long term care you can qualify for Medicaid (sometimes referred to as Title XIX) relatively easily. However, it is not easy to become eligible for Medicaid. The Department of Social Services (“DSS”) has strict asset and income guidelines that an applicant must meet before qualifying for benefits.

For example, a single individual applying for Medicaid home care benefits can have a maximum of $1,600 in assets (DSS excludes certain assets such as the value of the home) and a monthly income of $2,022 and still be eligible. If both spouses are applying for Medicaid home care benefits, they can each keep $1,600 in assets ($3,200 total plus the home) and a combined monthly income of $4,044. If the actual income exceeds the income limits, trust arrangements can be made to assure eligibility while protecting the interests of the state.

If an unmarried individual needs long term care in a facility, the monthly income maximum drops to $69 (with certain exceptions). For married couples, if only one spouse is applying for benefits, the other spouse (the “community spouse”) may be able to keep additional assets of up to $109,560 plus the home and a monthly income of at least $1,821.25 and as much as $2,739 (adjustments may be obtained through the Fair Hearing process).  If the actual income exceeds the income limits, excess income will be applied to the cost of nursing home care.

DSS not only looks at your assets as of the date of your application, but it also looks at any transfers you have made for less than fair market value within the last five years. This includes transfers to a trust (with some exceptions), the purchase of certain annuities, and gifts to your children. Any such transfer will result in a period of disqualification (a “penalty”) from Medicaid eligibility, based on the value of the property you transferred. The penalty period does not begin to run until you have met the asset and income requirements, at which time you will be required to cover the cost of care until the penalty period ends.

Anyone who may need Medicaid to cover long term care services within the next five years should be aware of these transfer rules before making any gifts. Certain transfers, if well-planned, can be made without causing a penalty.

Keep in mind, if you or your spouse may need Medicaid to cover your long term care needs you should re-examine your Wills and any beneficiary designations you may have on life insurance policies or other accounts. Once you have qualified for Medicaid, any assets you receive (through inheritance or otherwise) could disqualify you.

3. Long Term Care Insurance

Many people think that long term care insurance is unnecessary or not worth the expense. However, long term care insurance, while not suitable for everyone, can be extremely beneficial. People with middle-incomes, who might otherwise spend down their assets to apply for Medicaid, may find long term care insurance is a worthwhile alternative.

Connecticut has created the Connecticut Partnership for Long Term Care whereby private insurance companies sell state-approved insurance policies that cover long term care costs (both home care and nursing home care). A key feature of this program is the built-in Medicaid asset protection that applies if you ever need state assistance. The Medicaid asset protection allows you to qualify for Medicaid benefits without meeting the usual asset limitations (stated above). DSS allows you to keep one extra dollar of assets for every dollar that your policy has paid for your long term care. This can protect a large portion of your assets that you would have otherwise spent down to become eligible.

Posted on 1/4/2010 by Kasey S. Galner, Associate, Chipman, Mazzucco, Land & Pennarola, LLC.


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