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What is Estate Planning and Why Do It?

in Articles by Greg McIntyre Leave a comment

Estate planning and elder law attorneys Greg McIntyre and Brenton Begley explore the ins and outs of estate planning from Foundations to Trusts.


Related Articles:

Can my trust protect my retirement accounts?

Is Your Trust Convertible?

How to Fund a Trust


If we can help you preserve assets before major changes in the law we would be glad to do so and would offer a FREE consult to sit down and discuss asset protection. Give s a call to schedule your free consult today or schedule online at: mcelderlaw.com. For a list of local numbers to our offices see below:

  • Charlotte: 704-749-9244
  • Shelby: 704-259-7040
  • Hendersonville: 828-233-5991

Please don’t wait ‘til it’s too late. Call McIntyre Elder Law today.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Fiduciary Series: Trustee

in Articles, Attorney Advisor Series by Greg McIntyre Leave a comment

The next steps after being named a trustee depend on what kind of trust to which you’ve been named the fiduciary. Specifically, you must first determine whether you’re trustee of a revocable or irrevocable trust. 

Revocable

As a quick reminder, a revocable trust is an amendable trust agreement of which the Grantor (the person who made the trust) may also serve as Trustee. However, regardless of who is acting as Trustee, the Grantor may amend a revocable trust at any time. 

If you’ve been named as Trustee, you need to know what the trust says. Most revocable trusts maintain the Grantor as Trustee and name non-grantor parties as successor Trustee. This person steps into the role as Trustee if one or both of the Grantors becomes incompetent, incapacitated, or otherwise unable to act because of illness or death. Just because you’ve been named as a successor Trustee doesn’t mean you can avoid doing your homework. You should have a copy of the trust, be appraised of the material terms of the trust, and know what assets the trust holds. 

Irrevocable

An irrevocable trust is one that is not amendable and cannot have a Grantor as the Trustee. Thus, if you’re named as the trustee of an irrevocable trust, your job starts on day one. Whatever is held by the trust is managed by you and only you—unless you have a co-trustee. Similar to a revocable trust, you should understand the terms of the trust and you should be aware of the trust assets. 

Irrevocable trusts are typically used to protect assets for a particular reason. Therefore, they may have stringent terms and must be administered with the utmost care. In consideration of the gravity of this duty, you should seek the advise of counsel to understand the left and right parameters of your authority with respect to the trust. Furthermore, you should likely seek the advice of an attorney before making major decisions on behalf of the trust. After all, the trust was set up with an abundance of care and forethought. Such care and forethought should be the theme going forward. 

If you become the Trustee of a trust created under a will (a testamentary trust) or under another trust, that trust will be considered irrevocable. 

Conclusion

Because trusts are such flexible documents, the terms and manner of administration may differ greatly from one trust to another. Thus, it’s imperative that the individual tasked with the proper administration of the trust must seek the proper guidance to ensure they carry out they duty properly.

If you have questions about the administration of trusts give the experienced attorneys at McIntyre Elder Law a call at 704-259-7040 or visit our website at mcelderlaw.com.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Brenton S. Begley, Elder Law Attorney

Book Your FREE CONSULT Today!

Regards,

Brenton S. Begley

Elder Law Attorney

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

www.mcelderlaw.com

Phone: 704-259-7040

Fiduciary Series: Executor

in Articles, Attorney Advisor Series by Greg McIntyre Leave a comment

So, you’ve been named someone’s Executor in their will. Now what? The answer to this question can be broken into two separate phases: pre death and post death (to put it bluntly). It’s important to note that you don’t have to be an Executor, even if you’ve been named. However, if you choose to undertake this duty, it’s best to know what to do next. Here are your immediate first steps.

Phase 1:

Phase 1 is easy. You have been named an Executor in the last will and testament of someone who trusts you. The person that named you (the Testator) is thankfully still alive. So, there’s not much to do. This is because the will doesn’t really come into play until the death of the testator. That being said, there are a couple things you need to know.

You need to know the location of the original copy of the will. To probate a will, you must have the original version. And, while it’s possible to probate a copy, it’s a huge headache. Thus, you should ensure that the Testator keeps the original in a safe place that you have access to.

You should know which items, generally, are passing through probate. A will means probate. Thus, only assets that pass-through probate are controlled by the will. Because of this, you should have a general idea of the assets, owned by the Testator, that will pass outside of probate. These assets may be ones that have been placed in trust or assets that have a beneficiary designated or right of survivorship. Either way, knowing which assets you actually need to worry about will save you a lot of time and energy.

Phase 2:

You should know what the will says. Wills are legal documents with terms of art that can be confusing. Furthermore, some of the provisions in the will may not apply. To determine the proper plan going forward, you should seek legal counsel to ensure you understand how the law governs the process you’re entering.

You should know who the heirs are. Similar to the terms of the will, the heirs at law may not be ready ascertainable by simply reading the will. Your duty as the Executor is, primarily, to determine who the heirs are and what they get. Therefore, this is another area where you should seek legal counsel. You want to make sure that you’re getting this part correct. Otherwise, you could face liability.

Lastly, your first step with the court system will be to file the original will and apply to be the Executor—even though you’ve been named, you must be approved by the court. At this point, the estate is open, the probate process has begun, and your duties as Executor commence.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Brenton S. Begley, Elder Law Attorney

Book Your FREE CONSULT Today!

Regards,

Brenton S. Begley

Elder Law Attorney

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

www.mcelderlaw.com

Phone: 704-259-7040

Education Spotlight: Home Protection with Deeds

in Articles, Attorney Advisor Series by Greg McIntyre Leave a comment

Estate Planning & Elder Law Attorney, Brenton Begley gives a great education moment to our team and you on how to protect your home with deeds. Schedule your FREE consult today: 704-749-9244, or online at: mcelderlaw.com/freeconsult.


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Brenton S. Begley, Elder Law Attorney

Book Your FREE CONSULT Today!

Regards,

Brenton S. Begley

Elder Law Attorney

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

www.mcelderlaw.com

Phone: 704-259-7040

Can my trust protect my retirement accounts?

in Articles, Attorney Advisor Series by Greg McIntyre Leave a comment

When discussing an estate plan, there is almost always an important question from people around what to do with their retirement accounts.  They tend to be one of the major assets for an individual and it makes sense to want to protect them with a powerful legal tool like a trust.  However, while you are living you cannot place your retirement accounts directly into a trust.   But, as you may have guessed since we are still in the first paragraph, that does not mean the discussion stops there.  Even though the retirement accounts cannot go directly into the trust, it is worth strategizing to determine the best approach to ensure the protection and preservation of those assets.  The first question we have to address is whether those retirement accounts are tax deferred accounts or not.  

What is a tax deferred account?

Initially, we should be clear on what a tax deferred account is.  This refers to an account where you have not paid taxes on the money that has been placed into that account, an advantage afforded to accounts like your 401(k) or a Traditional IRA.  However, it is important to emphasize that it is tax deferred and not tax free.  It is deferred because someone, someday, is going to pay tax on that money when it is withdrawn.  That may be you paying tax on that money as it is withdrawn in your retirement, or it will be your beneficiaries paying tax on it as they are required to withdraw it after they inherit the account.

This is in contrast with an account such as a Roth IRA, where you have already paid tax on the money invested in the account.  If your retirement assets are housed in a Roth IRA currently, then you have a lot more flexibility with how you manage that account.  Even though the specific Roth IRA account cannot be placed into the trust, those assets you have invested in the Roth IRA can be moved into an account within the trust without having to pay the same penalties or level of tax that is due on a tax deferred account.

Can my tax deferred account be placed directly into a trust?

No, that tax deferred account cannot be transferred directly into your trust.  But that does not mean those assets are destined to count against you for medicaid qualification purposes, or that those assets do not have an avenue to protection and preservation. 

The main consideration at this stage is going to be defining your goal with those assets.  If your planning does not include medicaid qualification then your estate plan could rely on ensuring there are beneficiaries on your accounts so that the assets do avoid probate.  But it is worth considering the value of a program like long term care medicaid and the thousands of dollars that have to be spent every month for long term care.  Factoring in the value you receive compared to what it would cost to transfer your assets out of a retirement account into your trust allows you to reach a decision that makes the most sense for you.  

Are the tax consequences the same if I or my beneficiaries withdraw the assets from my tax deferred account?

The amount of tax paid is very likely to be different depending on who is withdrawing the assets.  As I stated at the outset here, someone has to pay the taxes on your retirement account someday.  The likely options are either you pay them during your life by withdrawing the assets yourself or that your beneficiaries pay them as they make required withdrawals after inheriting it.

Legislation was passed at the federal level in 2019, called the Secure Act, that requires beneficiaries of a tax deferred account to withdraw those inherited funds over the span of a ten year maximum period.  This ten year deadline is critical to be aware of for planning purposes because what that really means is that the assets in your tax deferred account may be more valuable to you than they will be to your beneficiaries when the rubber meets the road.  This is because you are not required as the initial investor to withdraw that entire asset over the course of ten years.  Additionally, it is assumed that when you are making most of your withdrawals from that account you are retired.  Making withdrawals during retirement means you are not earning additional income through a job and pushing your income tax rate to a higher level. 

However, the flip side is that your beneficiary is likely to receive this asset during their working years and therefore they will be taxed on these withdrawals at a higher rate as it is added to their income.  The ten year withdrawal requirement also limits the beneficiary’s ability to spread those withdrawals out over a longer period of time, consequently increasing the amount taken out each year and importantly, increasing the amount of taxable income to that individual. 

THE BIG QUESTION

Is it the right decision to move my assets out of their tax-deferred status so that I can place them in my trust?

Here comes the classic lawyer answer, it depends!  The answer here depends on your individual goals and circumstances.  We are only here to recommend tools that fit your needs and will benefit you.  There are absolutely scenarios where the right financial move is going to involve withdrawing those assets out of their tax-deferred status and placing them into your trust.  That is because with your assets in a trust you are possibly setting yourself up to qualify for long term care medicaid to assist with paying for your expenses, limiting your tax liability from any changes to the estate and gift tax, and protecting those assets from other creditors or lawsuits so that they make it to the hands of your loved ones.  If this question is one you are considering yourself, one of our attorneys would be happy to assess your specific situation and work with you to come to the decision that is best for you.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (828) 233-5991.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Book Your FREE CONSULT Today!

Jake Edwards, Attorney

Jake Edwards

Estate Planning & Elder Law Attorney

mcelderlaw.com

Hendersonville Office

136 S. King St. Hendersonville, NC 28792

828-233-5991

Now What? I’ve Been Appointed as Agent under a Power of Attorney. 4 Things to Consider.

in Articles, Attorney Advisor Series by Greg McIntyre Leave a comment

Article 1: Fiduciary Instruction Series.

So, you’ve been named as somebody’s agent under power of attorney. That person (the “Principal”) is beginning to need your help making financial and healthcare decisions. What are you next steps?

1. Make Sure the Power of Attorney is Valid and Works
You first want to make sure the POA is valid. Financial POAs must be signed by the Principal and notarized, and should be recorded at the register of deeds in the county where the Principal resides. The healthcare POA must be signed by the principal and witness by two independent individuals in addition to being notarized.
The POAs should also be broad and specific. They must lay out each power given to the Agent and must define each power. It’s also important to ensure that you know when the power becomes effective I.e., whether the Principal must be considered “incompetent” before it can be used.

 
If the POAs are either invalid or fall short, you should seek to have them redone by an attorney while the Principal is in their right mind. Note, that this MUST be done with the Principal’s full knowledge and cooperation.

 
2. Make Sure the Power of Attorney is on File with the Relevant Entities
You don’t want any hitches in attempting to use the POA. Typically, the bank or life insurance company, or any other entity won’t let you use the POA until they’ be had their in-house attorneys review and approve them. Depending on the company, this can take days or weeks. Thus, it’s important to go ahead and put the POAs on file with each and every relevant entity, including the bank, primary physician, investment company, life insurance company, and the register of deeds. This is best done by mailing, emailing, or faxing a copy of the POA with a cover letter indicating your purposes for sending the document. 


3. Make Sure You Know Where Everything Is
It will be difficult to act on behalf of the Principal if you don’t know where they bank, where they have their life insurance, who their primary care physician is etc. Thus, you should figure out, by talking to the Principal, where everything is. You should compile a list and keep it with the POA document. This list should also include medications, who they use for tax preparation, their attorney, the funeral home ( if they’ve prepaid their funeral), their bank accounts and number, their credit card accounts, their driver’s license information, a copy of their birth certificate, a copy of their marriage license, if any, and a copy of their social security card. 

4. Speak to a Professional about Asset Protection
Lastly, you should seek the advice of a professional. There are many considerations when evaluating how to best act on behalf of someone who may not be able to act for themselves—from protecting assets to figuring out how to pay for long-term care. 


An experienced Elder Law attorney should be consulted, so that you may lay out a clear and workable plan to ensure you’re doing the right thing to protect the Principal’s assets and ensure that they receive the highest possible level of care.

This gives us the legal basis for the Ladybird Deed that we now know and love.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Brenton S. Begley, Elder Law Attorney

Book Your FREE CONSULT Today!

Regards,

Brenton S. Begley

Elder Law Attorney

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

www.mcelderlaw.com

Phone: 704-259-7040

Why doing the right thing could cost you? Caregiver Edition*

in Articles by Greg McIntyre Leave a comment

Picture this… Your elderly parent or loved one has been living at home, but they cannot completely care for themselves. They might need help cooking, cleaning, bathing, and assistance with other activities of daily living. You and your loved one may have come to a verbal agreement that you would be compensated for your time and efforts, or maybe your loved one has been paying a family friend to look after them. You don’t need an actual written contract because you are family, or you have known that family friend for years, right? WRONG. Your loved one may eventually need a higher level of care in an assisted living or skilled nursing facility and they may need to apply for benefits to assist with the cost of care. Many of you may have heard of that ominous “Look-back Period”. During the look-back period, any payment to caregivers without having a written contract in place prior to services being provided, could disqualify them for benefits for a period of time. The contract must also meet certain requirements in order to be accepted by the Department of Social Services.

Let’s just say, for example, that Mom has been paying you $500/week for the last year to provide care and other services, which comes out to $26,000 for the year and you did not have a written contract in place. There is a formula used to calculate the penalty period and that $26,000 would result in roughly a 4-month penalty period. The penalty period means that your loved one would have to pay out of pocket  for their cost of care in a facility for 4 months before their long-term care benefits would begin. But wait, it gets a little more complicated. That 4 month penalty period wouldn’t begin until Mom was “otherwise qualified” for benefits. That is a discussion for another time (perhaps at your hour-long, free consultation with one of our experienced attorneys). The average cost of care in a skilled nursing facility is around $7,500-$10,000, so at the very minimum, that $26,000 just cost Mom $30,000. 

Navigating the qualification and application process for Long-Term Care benefits can be challenging and sometimes the policies just don’t seem fair or make sense, especially when you were just trying to care for your family. This is just one of the ways that could cause your loved to potentially incur a penalty period when applying for benefits.

The solution? Come speak to one of our experienced attorneys about drafting an inexpensive caregiver agreement that could save your loved one tens of thousands of dollars. Our attorney’s can advise you on how to avoid other penalty-incurring transactions, and how to best prepare for your or your loved one’s long term care needs.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Mary Kales, Firm Medicaid Director

Book Your FREE CONSULT Today!

Regards,

Mary Kales

Firm Medicaid Director

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

www.mcelderlaw.com

Phone: 704-259-7040

*Article proofed and approved by attorney, Gregory S. McIntyre.

Legality of the Ladybird Deed

in Articles, Attorney Advisor Series by Greg McIntyre Leave a comment

I get the question all the time: is the Ladybird Deed legal in NC? The answer is yes. But, I don’t want you to simply take my word without any further information. So, in an effort to settle the question once and for all, let me give you the legal basis for the Ladybird Deed. But first, why question it at all?

Maybe you did a Google search for Ladybird deeds in NC. Maybe you were talking to your neighbor. But someone somewhere said that Ladybird Deeds aren’t legal in NC. But here we are saving homes every day with this wonderful tool. Why the discrepancy? Well, the problem is that the people posting these articles on the internet aren’t doing their homework. Likely, they scanned the statutes in NC to see if it mentions “Ladybird Deed” and didn’t find it. Thus, they declare that NC doesn’t allow the Ladybird Deed.

The problem is: we don’t have a statute for the Ladybird Deed. In fact, most of our property law in NC is not codified in statute. Our property law is predominantly derived from common law or judge made law (also known as “legal precedent”). See Statute of Wills, 32, Hen. 8, c. 1 (enacted in 1540).

With that out of the way, what precedent allows for the Ladybird Deed.  To recap, a Ladybird deed allows you to put a beneficiary on property (who you can change any time) without giving away any property interest). 

We can trace the roots all the way back to jolly old England. English common law allows for something called a “power of appointment.” When you think of power of appointment, the best example is something like designating a beneficiary on a life insurance policy (note: this is not exactly a power of appointment but is good enough for this analogy). On a life insurance policy, you can pick a beneficiary to get the death benefit. However, that’s not set in stone. You can change that beneficiary any time. This is  because you have the power to appoint whoever you want. A power of appointment is similar.

Per N.C.G.S. Section 4‑1, adopted in 1778, English common law is the law of the land in NC unless something says otherwise. There are no laws in NC preventing a power of appointment. Thus, the next question is: what precedent allows for a power of appointment on a deed?

This is a legitimate question because deeds convey interest. Usually, when a deed is executed, something (some right or interest in real property) is given. If the property is given to your beneficiary, then how do you retain a power of appointment. It’s like giving away your life insurance policy, yet retaining the power to pick the beneficiary. Luckily, both issues were solved in a super old case: Troy v. Troy, 60 N.C. 624 (1864).

Troy basically said that you can: 1. assign a beneficiary to property without giving them any interest; and 2. maintain a power to appoint any other beneficiary at any time without another person’s consent.

This gives us the legal basis for the Ladybird Deed that we now know and love.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Brenton S. Begley, Elder Law Attorney

Book Your FREE CONSULT Today!

Regards,

Brenton S. Begley

Elder Law Attorney

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

www.mcelderlaw.com

Phone: 704-259-7040

What type of Trust is Right for You?

in Articles by Greg McIntyre Leave a comment

Irrevocable Trust:

Join our Shelby attorney, Brenton Begley, as he sits down and talks about an Irrevocable Trust!


Revocable Living Trust:

A revocable living trust or RLT may be a great way for you to:

  1. Stay in control of assets.
  2. Avoid Probate.
  3. Maximize your taxable exemptions.

Testamentary Trust:

Testamentary Trusts: These can be a straightforward way to utilize your will to create trusts for your property lasting well into the future.


Related Articles:


If we can help you preserve assets before major changes in the law we would be glad to do so and would offer a FREE consult to sit down and discuss asset protection. Give s a call to schedule your free consult today or schedule online at: mcelderlaw.com. For a list of local numbers to our offices see below:

  • Charlotte: 704-749-9244
  • Shelby: 704-259-7040
  • Hendersonville: 828-233-5991

Please don’t wait ‘til it’s too late. Call McIntyre Elder Law today.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

What’s the deal with having two power of attorney documents?

in Articles by Greg McIntyre Leave a comment

Why can’t I just have one document that makes someone my power of attorney for everything? Well, technically you could do that.  However, there are some clear reasons why that is not common practice and why we don’t advise taking that approach.

            The first consideration is cost.  A very practical reason not to combine your General Durable Power of Attorney and your Healthcare Power of Attorney in the same document is that it would double your recording costs.  That is because although the Healthcare Power of Attorney does not need to be recorded at the Register of Deeds, the General Durable Power of Attorney is recorded.  When a document is recorded you typically have a charge based on the length of the document, so the inclusion of all of the necessary pages in a Healthcare Power of Attorney would add to the total recording fees you had to pay.  No one likes paying extra fees and so we don’t advise you to create a document that would result in unnecessary expense for you at the Register of Deeds.

A second major concern is efficiency.  You may be thinking, hold on, wouldn’t the efficient approach be having only one document?  However, the reality is that combining medical and financial information into one document would tend to make things harder on the agent that was granted those powers and on the institutions relying on those documents to allow your agent to act on your behalf.  Banks can be very picky about how they handle powers of attorney.  The inclusion of paperwork that is unnecessary for the financial institution is just asking for the possibility of a slow down in using your document.

Additionally, your Healthcare Power of Attorney could include very personal decisions and details about your medical situation that your financial institution does not need to know about.  Likewise, your healthcare provider does not need to have to sift through details and decisions related to your finances before verifying that someone can make a medical decision on your behalf.

Finally, the only thing worse than attempting to combine both powers of attorney into one document is having no power of attorney in place at all.  These documents can make a massive difference in a crisis situation, as they allow someone to act on your behalf efficiently and also in ways to reduce further costs on you.  Important medical decisions can be made quickly and actions can be taken regarding bills and expenses in order to avoid racking up late fees or liens on your property.  

If you don’t have the protections of a General Durable Power of Attorney or a Healthcare Power of Attorney in place, one of the attorneys in our offices would be happy to discuss these with you and see what best fits your needs.


Related Articles:


If you or your loved one has questions we would be glad to extend a FREE CONSULT to answer those estate planning and elder law questions and get your affairs in order. Let the experienced attorneys at McIntyre Elder Law help. Call (704) 259-7040.

Schedule Free Consult

IN PERSON . VIDEO CONSULT . PHONE CONSULT

Book Your FREE CONSULT Today!

Jake Edwards, Attorney

Jake Edwards

Estate Planning & Elder Law Attorney

mcelderlaw.com

Hendersonville Office

136 S. King St. Hendersonville, NC 28792

828-233-5991

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