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Elder Law Articles

Pros and Cons of Trusts

Pros and Cons of Trusts

Trusts are used for planning during lifetime and after death. They can be used to protect assets, avoid probate, manage money for children who are too young to handle money themselves. In addition, they can shelter assets if VA aid and attendance or Medicaid are needed and can save on inheritance taxes for those who have taxable estates.

Misunderstanding Gifting Rules

Misunderstanding Gifting Rules

Those who do not deal with tax laws and Medicaid rules on a regular basis usually have a misunderstanding on gifting rules, because the tax laws and Medicaid rules are totally different. Gift tax laws as of 2022 state that gifts up to $16,000 per person per year do not count as a taxable gift. If a parent gives $17,000 in one year to a child, the gift has exceeded the $16,000 limit by $1,000, and in theory theory the $1000 is countable as a gift. But the gift and inheritance tax law Connecticut has an overall $7.1 million lifetime exception. That means the excess gift of $1,000 will be subtracted from the persons $7.1 million lifetime exemption and should bring a smile to almost everyone reading this, because very few people gave more than $7.1 million in assets. In short, there is no tax on that gift unless the total of countable lifetime gifts and transfers after death exceed $7.1 million.

Medicare and Medicaid

Medicare and Medicaid

Medicare and Medicaid sound alike, but the two programs should not be confused. After age sixty-five everyone automatically qualifies for Medicare. It’s a federal health insurance program. There are deductibles, and monthly premiums are deducted from social security payments. It can pay for hospitalization, doctors, prescriptions, and rehabilitation. It does not pay for long term care. Unless you can qualify for Medicaid (Title 19) you will have to pay for long term care yourself. That can quickly wipe out assets and at nursing home costs can approach $18,000 a month. So how do you qualify for Medicaid?

Medicaid Application Pitfalls

Medicaid Application Pitfalls

People sometimes ask, “Can I do a Medicaid application by myself?” From an attorney’s point of view, that’s somewhat like asking a doctor if you can do an operation by yourself. But you wouldn’t ever ask the doctor that because of all the unknown steps and complications of the operation. In many respects, the pre-operative preparation, the double checking that takes place, and being ready to deal with all the complications that can arise, are analogous to going through the Medicaid process. Here’s why.

It’s About Mom

It’s About Mom

Those three words form a huge percentage of calls for elder law services. The calls are made because adult children have come to realize that their elderly mom cannot safely take care of herself anymore. Whether caused by physical or cognitive issues, that mother who was a pillar of the family’s house through life needs help. What kind of help, where to get it, who is going to give it, and how can the family afford it are the critical questions. The “what kind of help” relates to help with the activities of daily living, such as bathing, dressing, feeding, toileting and personal safety.

Wills and Trusts, Oh My!

Wills and Trusts, Oh My!

While you won’t be planning a trip to the land of Oz like Dorothy, someday you will be thinking about how to pass on your life’s savings to your children and grandchildren. The automatic though is “I need a Will.” That is always true but trusts and beneficiary designations can also play a vital role. A will is a legal document that passes assets to the people you name, if those assets don’t pass to them because of joint ownership or beneficiary designations, or by trust. So, a will is always needed just in case the house, or bank account or stocks and bonds do not automatically transfer to the persons you want.

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