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2018: Success & Failure…

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PLAN OR NO PLAN – LIFE IS COMING IN 2019

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Elder Law Report: CAREGIVER AGREEMENTS!

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Introducing: Mr. Foundations. “The Most Interesting Man in Elder Law”

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Guardianships

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We’re talking about Guardianships in this elder law report, because much of this week I’ve been involved in Guardianship hearings. Guardianships can be very contentious. The situations that surround Guardianships can tear families apart.

The hearings I was involved in this week were almost cathartic. Getting some of the bad blood out during the hearing, allowed for some healing to take place, but the hearings were still stressful. They’re not just stressful for me, they’re stressful for the family involved. It’s best that you avoid Guardianships, but this is about clarifying the Guardianship process for you.

There are three types of Guardianship.

  • Guardian of the Estate. This is Guardianship over money and legal matters.
  • Guardian of the Person. This is Guardianship over healthcare decisions.
  • General Guardianship. This is for both legal, financial and personal decisions such as healthcare.

 

In a Guardianship hearing, with someone in the family who is incompetent or incapacitated, the money is frozen and healthcare decisions cannot be made until someone is appointed to oversee those matters.

You can avoid Guardianships by appointing a trusted family member or someone else you trust to be your Attorney-In-Fact, an Agent of you, through a document called a General Durable Power of Attorney. This document is general because it covers everything from real estate to bank accounts, and any legal or financial matters where someone else takes care of that for you.

With personal healthcare matters, you are appointing a healthcare agent through a document called a Healthcare Power of Attorney.

You want to be prepared

Having someone on the bench ready to take over if you become incompetent or incapacitated is essential for peace of mind. You can appoint a primary and a secondary in case the primary becomes unable to act on your behalf.

Powers of Attorney can also be set up so that two or more people can:

  • Act together
  • Separately, or
  • You can make them act together so they both know what each other is doing, for example, with mom and dad’s money.

 

Powers of Attorney are powerful if you want to avoid those contentious, gut-wrenching, family destroying situations surrounding Guardianships and Guardianship hearings.

Now, I don’t want to diminish the importance of Guardianships. They are very important. There are situations where a Guardian needs to be appointed, even a public Guardian. They will come in and take control of assets and healthcare decisions because a family member (or someone else) is taking advantage of an incompetent or incapacitated family member. The court system is there to provide an avenue where a Guardian can be appointed and clamp down and stop that.

A clerk or a judge can put a stop to that by appointing a Guardian and enforce penalties to put a stop to any form of abuse, such as elder abuse or financial abuse.

These are very important and it’s something we deal with at Guardianship hearings. However, in most cases, you can prevent those from occurring by simply having your foundational documents (General Durable Power of Attorney and Healthcare Power of Attorney) in place ahead of time.

I often see people come to my office in dire straits. They’re willing to do some planning to activate a healthcare benefit, they may need to activate a Medicaid benefit to pay for nursing home care, or a veteran’s benefit, such as Aid and Attendance Pension benefit to pay for assisted living care. But if you don’t have these Powers of Attorney in place, it can be near impossible, or very difficult to get those benefits to pay for long-term care.

It is so simple and important to have these documents in place.

With Guardianships, sometimes those options can still be explored, but to do that, you must make a petition to the courts. This is usually done through an attorney, but you must do that every time you need something. You must explain and sell to the court that it’s a good idea to use this benefit or change the assets. The courts are reluctant to use those assets when someone needs them for their care.

Guardianship can be avoided.

If you want to avoid Guardianships, protect your assets and plan ahead, contact me, Greg McIntyre at 704-259-7040 and set up a General Durable Power of Attorney and Healthcare Power of Attorney.

The elder law report can be seen every week on Friday at 10am. Next week we will be talking about Deed Planning, so tune in.

If you have questions about Guardianships, call me, Greg McIntyre and schedule a consult at 704-998-5800 for Charlotte, or 704-259-7040 for Shelby, or visit our website mcelderlaw.com and we will do what we can to help you.

 

Greg Mcintyre

Elder Law Attorney

704-259-7040

Schedule Free Consult

The Untold Benefits of Estate Planning REAL TALK WARNING!

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Most of the benefits of estate planning are pretty obvious. People go to an estate planning attorney because they want to determine how their property will pass after their death. What is not obvious, however, is the residual benefits of the estate planning process. Namely, the reflection on one’s life, the consideration of one’s death, and the contemplation of the future.

 

Someone once told me a story about their estate planning process that resonated with me. She and her husband worked hard, earned a decent living, and achieved a ripe age. Up to that point, they had never put anything into place, no powers of attorney, no living will, not even a will. They finally decided to have an attorney help them with their plan and they got all the necessary documents in place. Sadly, not long after, the husband suddenly passed away. The unexpected illness and abrupt death of her husband was, no doubt, very difficult for the wife as she made decisions for her husband. However, she was able to make these decisions with peace of mind because they had sat down and made their plan beforehand.

 

The main thing I took from this story was the fact that the planning process arms you with an important tool, knowledge. The thing about estate planning is that it forces you to confront your own mortality. It makes you consider what you value, who you value, and how you want to be remembered. In turn, your loved ones will have the necessary knowledge to make the appropriate decisions without struggling with ambivalence while mourning your death.

 

For example, the woman above was presented with the difficult choice of determining whether to take her husband off of life support. This is the sort of choice that is not ever easy to make no matter how much you plan ahead. Nonetheless, she made her choice and her mind is at peace because they had the opportunity to have the difficult conversation and convey their wishes to each other anything happened.

 

The lesson I have learned from her story and stories like hers is that planning is important and there is no time like the present. Death is inevitable but seldom predictable. You can be healthy one day and struggling for life the next. The only guarantee is that one day you will meet your end, you just don’t get to know when that will be. So, have the difficult conversation, face the void –if only for a bit—and make a plan so that your loved ones don’t have to bear the burden themselves.

 

Brenton S. Begley, JD, LLM Taxation
Attorney with McIntyre Elder Law

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Who Do You Trust?

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Who Do You Trust?

A common theme that permeates estate planning is the need to have a clear idea of who you unconditionally trust. When you create a will, you must appoint an executor; when you create a trust, you must appoint a trustee; and when you create a power of attorney, you must appoint an attorney in fact. It is important to give thought to whom you think can ethically carry out their fiduciary duty in the manner that closely mirrors your wishes.

The Who

Trust is only one of the considerations that must be weighed in choosing a fiduciary. Another important consideration is capability, namely whether the person appointed has the skills to effectively carryout their responsibilities. This is especially poignant if you have a complex estate plan, a large estate, a large amount of debt, or a large number of heirs.

Many of us would automatically defer to appointing our spouses. This is a reasonable approach, considering they have intimate knowledge of your wishes, and have likely intertwined their estate plan with yours. But you must consider that many of the fiduciary duties that spring from an estate plan arise from the death of the planner. Thus, the process of acting as a fiduciary can be made extremely difficult for those who were close to the decedent.

That is not to say that you should avoid appointing a spouse or loved one. Many times, they can more than adequately fulfill the role. You simply must consider the gravity of what you are asking these individuals to do. Before appointing a fiduciary, you should speak with your loved ones to determine whether they are up for the task.

The What

            What are these fiduciary powers that you are granting? How do they affect your estate plan?

  • Executor: this individual carries out or executes the wishes set forth in your will. This process starts by filing the will at the courthouse, which begins the probate process. They will then pay off debts of the estate, distribute property of the estate, and provide an inventory and accounting of the estate.
  • Trustee: trusts can have many different functions; however, the role of the trustee remains essentially the same. It is the person who is trusted to manage the assets in the trust, to make decisions in the best interest of the trust, and to ensure that the directions set forth in the trust instrument are carried out.
  • Attorney-in-fact: this could either be your fiduciary for financial and legal purposes or for medical purposes. This individual will act as youand carry out your wishes when you are unable or incapable of doing so on your own accord.

 

These individuals could all be the same or separate people. However you chose, the appointed fiduciaries play a critical role in ensuring that your wishes come to fruition.

The How

Not only should you consider who you will appoint as your fiduciary, you need to consider how. Specifically, you should consider who will be the primary and who will be the backup.

There are many reasons why you should consider appointing a backup or secondary. It may be that the primary is unable to carry out their duties because of death, incompetency, or physical inability. It also may be that the primary is in a compromising emotional state resulting from the death of a loved one. Either way, it is important to have someone that can step into their shoes and fulfill the role.

The Conclusion        

You should take some time to consider who you want to be your fiduciary. They should be trusted and capable individuals who are up for the task. You should also consider who you would like to appoint as an alternate, they should know that there is a significant likelihood that they may be called upon to fulfill the role as fiduciary, for whatever reason.

If you would like to appoint a primary or secondary fiduciary, you should contact a qualified Estate Planning Attorney to assist you in drafting or updating your estate plan

Brenton S. Begley, JD, LLM Taxation

                                                                    Attorney with McIntyre Elder Law

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What Happens if You Die Without a Will?

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What Happens if You Die Without a Will?

 “The responsible thing to do is to make sure you have a will in place before you pass.” I am sure just about every adult in the US has been told that statement. But why is it important to have a will? What happens if you do not have a will executed before your death?

Testate vs Intestate

If you have spent enough time around attorneys, you have probably heard these terms before. But these terms are not frequently thrown around in common parlance and can be confusing those without the letters “JD” by their name. If a person dies testate, it simply means that a valid will has been executed. Of course, dying intestate—as the prefix would suggest—is the inverse, meaning that the person has died without executing a valid will. Either way, when a person passes the assets and belongings left behind becomes their “estate”.

Testacy

An individual who executes a will is called a “testator”. If an individual or testator dies testate, their property will pass according to the provisions set forth in their will. This will allow individuals to preplan and make general and specific devises of their assets to their heirs upon their death. The will, if validly executed, will be recognized by the jurisdiction in which the testator resided before their passing.

After the testator has passed away, the executor of the estate—which the testator named in the will—will file the will with the clerk of court. This will begin the legal process of fulfilling the testator’s wishes as set forth in his or her will, called “probate”.

During the probate process, the executor will distribute the assets of the estate to the beneficiaries named in the will. They also have fiduciary duties to pay debts of the estate and to provide an accounting of the expenses, income, distribution, and payments of the estate.

The defining characteristic of dying testate is having a say in where your property goes, having a trusted individual execute your wishes, and having the ability to protect your heirs.

Intestacy

The estate of a decedent who passes away without a will passes through “intestate succession”. Intestate succession is determined by the intestacy statutes of the applicable jurisdiction. The statutes will pass a percentage of the estate to lineal descendants based on their position in the family tree.

In North Carolina, property that passes through intestate succession goes “per capita at each generation”. This means that the property goes in equal shares to each surviving descendant in the nearest degree of kinship. Depending on the structure of the family tree, the estate can pass to one or two descendants or splinter into many fractional shares. If there are no takers of the decedent’s assets, the property will “escheat” or pass to the state.

Upon the passing of the decedent an estate administrator will be named. Just about anyone can apply to be the estate administrator. The administrator will act in a fiduciary capacity and will distribute the property in the estate based on the intestacy statutes.

The defining characteristic of intestate succession is that the decedent has no say in who will carry out his or her wishes, has no say in where his or her property goes after their death, and has no ability to insulate their heirs from the possible legal downsides of inheritance.

What does this mean for you?

The biggest factor for individuals determining whether to execute a will is whether they want to dictate how their property will pass after they are gone. If you have any desire to have a say in who gets your property after your death, then you should consider creating a will.

It is also important to review your will if you have one to make sure it is valid and covers all the property you own. In North Carolina, if you have property that is not covered by your will it will pass through the intestate succession statutes. A common mistake among individuals is thinking that a fillable will, that they print from the internet, will be a sufficient means of passing their property and protecting their heirs. There are legal requirements that are necessary to executing a will and there is no guarantee that a pre-filled form will satisfy those requirements.

Lastly, it is important to have a detailed and comprehensive will with provisions that anticipate future events. Here at McIntyre Elder Law, we do our best to put safeguards in place to protect whomever may be taking under the will. That’s why all of our wills include protections for heirs who qualify for means tested benefits from the government. We want to make sure that those heirs can receive their inheritance without it disqualifying them from their benefits.

In Conclusion

A will is important because it gives you control over your assets and property and allows you to adequately plan for the future of your loved ones. Not only does it give you the opportunity to plan ahead, it also relieves your loved ones of most of the stress and frustration of settling your affairs after your passing.

If you are thinking about creating or modifying a will, find a qualified Estate Planning or Elder Law attorney to assist you.

 

Brenton S. Begley, JD, LLM Taxation

Attorney with McIntyre Elder Law

Schedule Free Consult

Look Back Period

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Elder Law Report

Look Back Periods

     Medicaid can be a scary time for families. If someone needs Medicaid it’s likely they’re searching for help with Long Term Care, Nursing Home or Assisted Living Care and how to save their hard-earned money and property while doing so. They are hoping Medicaid will step in and help pay for these things.

There are a lot of rules surrounding this process. One area of concern is look back periods.

What are look back periods?

      Let’s say you are applying for benefits today.

A look back period is the area of time Medicaid will examine all your financial history. For VA and Assisted Living Facilities they’re going to look back three years into your financial history. For Nursing Homes, Skilled Nursing Facilities or Long-Term Care Medicaid it will be a five year look back.

If we put in a Medicaid application today, Medicaid will look back at all your bank statements, all property (real estate) transfers (for the three to five year period) and make sure all the transactions were done correctly under the spend down rules.

Let’s say, (within a three year look back), you put a Ladybird Deed on your home one year ago, that would be acceptable because under Medicaid policy they allow you to do that. It is also okay under VA Pension Benefits because they allow you to have a home and two acres before they start to count value.

They are going to see this and say, we’re okay with that because that’s our policy. So, you can protect that home, get the benefit and they know they cannot back collect that home. (Ladybird Deeds protect the home and surrounding property up to about $550,000).

If you had transferred out-right (that is deeded your house to another person or a trust) three and half years ago, (and we were going for Assisted Living Medicaid with a three look back period), you would also be okay because it’s outside the look back period. This could also have been a money or wealth transfer.

However, Nursing Home Care has a five year look back period. If we stick with the above example and you transferred your house within the five year look back period, it must conform with the spend down rules, otherwise it will be flagged.

Remember, if you don’t transfer things correctly according to the spend down rules, you can find yourself in a lot of trouble and heartache. The penalty for working outside the rules can be either a penalty period, so within that time frame you would need to put the money back, or sacrifice the home when that person passes away because of the Medicaid lien, or you would have the person in need denied the benefits altogether.

We can help you in this process using Medicaid Planning and Asset Protection, Medicaid Activation and also Veteran’s Pension Benefits and Disability.

If you have questions about Spend Downs, call me, Greg McIntyre and schedule a consult at 704-998-5800 for Charlotte, or 704-259-7040 for Shelby, or visit our website mcelderlaw.com and we will do what we can to help you.

 

Greg Mcintyre

Elder Law Attorney

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