Many Veterans have been having issues with the Department of Veteran’s Affairs. Well, 60 Minutes has done a piece on the frustrations entitled “Delay, Deny and Hope That I Die.” You can see the piece here: Veteran’s Benefit Frustrations.

Michigan Medicaid Asset Protection Strategies

In Michigan, even after the passage of the Deficit Reduction Act and with Estate Recovery looming, we still have many techniques available to help Michigan seniors plan, even in crisis mode, for the large monthly Michigan nursing home costs. The cost of a nursing home in Michigan can run between $6,000.00 to $7,000.00 per month. Through proper planning this bill can be picked up by Medicaid if you meet the necessary requirements.

Our Michigan Elder Law Attorney office helps Michigan seniors plan for the cost of long term care, including assisted living and nursing homes, through various legal methods including “half-loaf” strategies, irrevocable trusts, proper gifting strategies, utilizing Michigan Veterans Benefits, and other legal tools.

It is important that you consult a Michigan attorney familiar with planning for long term care because there are many traps for the unwary and unfortunately quite a bit of misinformation out there. If you were to make a mistake in planning it can lead to a disqualification or unattended penalty for your loved one.

If you would like more information on any of these long term care strategies, please contact our office.

Michigan Asset Protection for Your House

Filed under: Asset Protection — Christopher J. Berry @ 4:10 pm

A common question we see is “how can I protect my house from creditors and lawsuits in Michigan?”. One easy from of Michigan asset protection for the house is through marriage and holding the asset properly on your title.

Michigan has created a special form of joint ownership called Tenancy by the Entireties. Tenancy by the Entireties is a form of joint ownership only available to Michigan husband and wives where they are viewed as one entity under Michigan law. What this means is that neither husband or wife may convey the property without the consent of the other.

So, if husband is sued, as long as husband and wife hold title to the house jointly, with Tenancy by the Entireties, then the house most likely would be protected from the lawsuit.

It is important to have an attorney review how title to the property is stated on the Warranty Deed or Quit Claim deed.

Michigan Estate Planning Basics

January 25, 2010

Filed under: Do It Yourself Estate Planning Gone Wrong,Estate Planning,Health Care Directives,LegalZoom,Living Trust,Power of Attorney,Probate,Quicken Willmaker,Suze Orman,Will — Christopher J. Berry @ 4:02 pm

With Michigan Estate Planning, there are a few basic things that you need to know.

First, no matter what your net worth is, how much in assets you have, how much debt you have, you need an estate plan. In Michigan, once you turn 18 you are legally an adult. So, even if you’re a college age adult who lives at home with your parents, there is a certain level of estate planning that should be done. That is you need, what our office calls, a disability plan. A disability plan plans for your disability or incapacity. We would put together a Patient Advocate Designation (which is the Michigan equivalent to a health care power of attorney), HIPAA Authorization, and a Financial Power of Attorney that most likely would name your parents as decision makers and agents.

Now that we’ve established that if you’re over the age of 18, you need the disability documents, the next step would be once you have assets (now matter how meager) or children, it is important to plan for your assets and children. This is done through using Revocable Living Trusts and Last Wills and Testaments. Whether you opt for a Living Trust based estate plan or a Will based estate plan will depend on your goals. Remember a Last Will and Testament only gives instructions to the Michigan Probate court on how to administer your estate, it does not avoid probate.

Lastly, it is important to consult a Michigan estate planning attorney in preparing your estate plan. Proper Michigan estate planning involves more than buying Nolo Willmaker software or reading the latest Suze Orman Trust Kit book. It involves analyzing your goals and situation and using the estate planning tools we’ve discussed in the most effective and cost effective way.

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No 2010 Federal Estate Tax…Hold the Cheers

January 15, 2010

Filed under: Estate Planning,Federal Estate Tax — Christopher J. Berry @ 4:05 pm

What a mess Congress has created! We are now in a year where there is no federal estate tax – but hold the cheers. Congress has substituted another method of taxation that will collect more taxes from many of our clients and families than the estate tax. Additionally, as has been reported in the local and national press, these changes will, for some, greatly alter the planned for and anticipated distributions among family members and heirs.

A brief review of the law will help explain why this is so significant. The 2001 tax act, signed into law by President George W. Bush, gradually reduced the maximum rate of the federal estate tax (and the equally onerous generation-skipping transfer tax on transfers to grandchildren) from 55% to 45%. It also gradually increased the amount of property that you could pass free of federal estate tax from $675,000 per person in 2001 to $3.5 million per person in 2009. That means that with basic estate planning, a married couple could pass up to $7 million free of federal estate tax, if they both died in 2009.

Then, in 2010 only, the 2001 tax act repeals the estate tax. But like a horror film character who just won’t die, under the existing law the estate tax returns again on January 1, 2011 – only at a much lower $1 million exemption and a higher maximum 55% tax rate! This strange “now it’s gone, no it isn’t” effect is the result of a rule in Congress that attempts to limit budget deficits.

Paying for Estate Tax Repeal

To pay for this one-year vacation from the estate tax, Congress replaced the estate tax with an increased income tax. Before 2010, any assets that pass to someone when you die would be valued at fair market value at the date of death. Thus after death, when a surviving spouse or heirs sold any assets (like securities or a home) that had increased in value, they would not have to pay income tax on any of that growth that occurred during your life. (This is referred to as a “step-up in basis.”) For many heirs this means huge income tax savings, oftentimes tens of thousands of dollars or more.

But in 2010 property that passes at death does not automatically receive this step-up in basis. Instead, each individual has a limited amount of property that can be “stepped-up” in value at the time of death. Property that does not receive this step-up value will be subject to tax on all increase in value from the date you first acquired the property. This means that the property could be exposed to tens of thousands of dollars of income tax liability for your heirs!
Not surprisingly, these rules are convoluted and in many cases very different from the old law. In fact, Congress attempted to institute a similar tax structure in the 1980s and it was repealed, retroactively, because it was too difficult to administer. Because of past experience as well as the anticipated difficulties in calculating such a tax, the common belief was that Congress would change the law before January 1, 2010. But it didn’t.

How You Are Affected?

This law can affect you in several ways. For married couples as well as single individuals, we need to first make sure that your property will be divided according to your desires, and not dictated by Congress. For more than 50 years it has been common to use a written mathematical formula to divide the assets of a married couple when the first spouse dies to maximize estate tax savings. Likewise formulas have been used to provide funds for charitable causes and to benefit family and friends. Now, in 2010 when there is no estate tax, these formulas will not work. If a spouse is not your sole beneficiary (for example, if you have children from a prior marriage), the existing formula could result in the disinheritance or substantial reduction of resources provided for the surviving spouse.

What Should You Do?

As Michigan estate planning attorneys, we encourage you to meet with us as soon as possible to review your estate plan and make any changes that are necessary for this law. We need now to ensure that your property is positioned to receive the maximum step-up in basis increase available under current law. This is a time that demands a new approach to your planning with new thinking and building in flexibility to see that your wishes are fulfilled no matter what Congress will throw at us this year or next. We have solutions that will meet you planning objectives with the least amount of tax impact.

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Michigan Elder Law Lawyers Specialize in Helping the Elderly

January 12, 2010

Filed under: Elder Law,Long Term Care,Medicaid Planning,Michigan Veterans Benefits — Christopher J. Berry @ 4:06 pm

Many elderly persons rely entirely on their children, family members or other trusted individuals to help them. This dependence upon caregivers or family members makes an older person more vulnerable to abuse and financial exploitation. Legal arrangements and protective actions by family may be necessary to shield loved ones from making bad decisions or from being taken advantage of.

Though you wouldn’t think a child could take advantage of his or her mother or father, there is no way to know what someone will do who is desperate for money or who feels entitled to an inheritance. For example:

David’s parents’ health was failing and living alone in their home was becoming a concern. His sister Jill wanted to look into assisted living for them. David immediately became upset at Jill for wanting to spend their money. He packed up his parents and brought them to his home. Being single and working, he was not available to them during the day, but left food and water on the table to sustain them until he returned home in the evening. Jill lived over 300 miles from David and when she could get to his house to visit; she found her parents’ care was not acceptable. They could not remember if they took their medications or if they had even eaten a meal that day. David was also draining their savings account and when confronted about it, became angry and complained that he needed their money to pay expenses for their care. Clearly Jill felt her brother’s care of their parents was abusive, but David’s defense was he provided a home for his parents in which he could care for them. This family needs a professional advisor to help them understand and clarify the issues concerning their parents’ care.

Making legal decisions about property, finances, power of attorney, and final wishes are important tasks to complete for the final years of life. Having legal documentation for a will, for medical treatment and for the person designated to be responsible for parents’ welfare can avoid family disputes and financial abuse, and help to conserve assets that are needed for care.

Michigan Elder law attorneys specialize in legal issues affecting the elderly. They are knowledgeable about Medicare and Medicaid programs. They work with the elderly in assisting them and their families with all aspects of estate planning and implementing necessary legal documents for the final years of life. In addition, they help individuals to apply for and possibly accelerate coverage from Medicaid. An elder law attorney can also help with disputes with Medicaid. Below is a partial list of what an elder law attorney might do:

* Preservation or transfer of assets seeking to avoid spousal impoverishment when a spouse enters a nursing home
* Medicaid qualification and application and Medicaid planning strategies
* Medicare claims and appeals
* Veterans Benefits claims
* Social security and disability claims and appeals
* Disability planning, including use of durable powers of attorney, living trusts and living wills
* Help with financial management and health care decisions; and other means of delegating management and decision-making to another in case of incompetence or incapacity
Probate
* Administration and management of trusts and estates
* Long term care placements in nursing homes and assisted living
* Nursing home issues with patients’ rights and nursing home quality
* Elder abuse and fraud recovery cases

A Certified Elder Law Attorney (CELA) is an elder law attorney who is highly proficient in meeting the legal needs of elders and in understanding and applying the rules of Medicaid. A CELA has successfully handled a requisite number of pertinent cases in order to receive that designation. This experience will make an attorney with this designation more competent with elder planning issues than other attorneys lacking this designation.

Most elder law attorneys do not specialize in all of the areas iterated above. When considering an attorney you will want to find one who has experience in the area you need help.

According to The National Academy of Elder Law Attorneys — http://www.naela.org/:

“Ask lots of questions before selecting an elder law attorney. You don’t want to end up in the office of an attorney who can’t help you. Start with the initial phone call. It is not unusual to speak only to a secretary, receptionist or office manager during an initial call or before actually meeting with the attorney. If so, ask this person your questions.

* How long has the attorney been in practice?
* Does his/her practice emphasize a particular area of law?
* How long has he/she been in this field?
* What percentage of his/her practice is devoted to elder law?
* Is there a fee for the first consultation and if so, how much is it?
* Given the nature of your problem, what information should you bring with you to the initial consultation?”

A good way to choose an attorney is by referral from friends, family, clergy or other associations. Before you meet for your initial consultation, prepare the items you want discussed and taken care of. Bring pertinent documents and questions. Be sure you get clear answers and that you understand what your attorney is proposing.

Two-way communication is the best way your attorney can understand your needs and concerns. Does the attorney listen to what you say, appear to really care about your concerns or return your phone calls? If not find another attorney. Most Elder law Attorneys sincerely want to help make you or your parent’s elder years a well planned for, peaceful experience for all involved.

There are a number of ways attorneys charge for their services. They may charge a flat hourly rate. Or they may charge hourly for some services and add on additional expense for out-of-pocket costs such as paperwork, stamps, phone calls, etc. Or they may charge a single fee for a mutually agreed-upon course of action or plan. Some attorneys who specialize in appeals for veterans benefits or Social Security may work on a contingency basis. It is important to understand how you will be billed so there will be no surprises in the end.

The National Care Planning Council lists elder law attorneys throughout the United States.
To find someone in your area go to http://www.longtermcarelink.net/

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Veterans’ Benefits Frustrations

January 9, 2010

Michigan Medicaid Asset Protection Strategies

January 4, 2010

Michigan Asset Protection for Your House

January 3, 2010