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Income Trusts and Medicaid: Exploring Options For Nursing Home Residents

Davidov Law Group

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What is Nursing Home Medicaid?

Nursing Home Medicaid is an all-encompassing program for older adults that covers all Medicaid services. Examples such as lab work, hospital stays, prescriptions, adult day care, and more are all part of the Medicaid program.

It’s important to discuss your options regarding your estate and your healthcare with an experienced local attorney. They are trained to help clients like you and your families prepare for the future. Each chapter of our lives will bring different circumstances, and it’s best to plan for each of them.

How Does New York Help Their Elderly Population?

Each state has a plan in place for our elderly loved ones. Programs are available if applicable, and you can choose the path that works best for you and your family as you approach your elderly years.

New York State has many programs and services that may interest you as you approach this stage of your life, including medical and non-medical assistance at home and after moving to a nursing home. Work with your competent lawyer to determine what is best for you and ensure you are eligible.

Am I or My Loved Ones Eligible for Medicaid?

When working with your trusted attorney, you can explore your options and ensure you can take advantage of the benefits available. As eligibility is primarily based on income and resources, you must have a solid plan in place if you wish to be eligible for Medicaid and other programs. By strategically handling your assets ahead of time through the help of an experienced estate planning attorney, you can set yourself up now for success in the future. For you and your family.

Protecting your assets and how they are accessible may make the difference you need to be eligible for benefits. There are several ways to achieve this, and you can work through the options and decide what is best for you and your family.

Plan Well In Advance

Nursing Home Medicaid typically includes a five-year look-back period regarding assets. This can mean that if you waited until just before the nursing home age to transfer assets, they can look back at those assets or transactions and impose penalties.

This is why you must plan well in advance for your later years and have an effective strategy to protect yourself, your loved ones, and your assets. Maybe a trust is necessary to hold and protect your assets and ensure that they aren’t factored into your eligibility requirements for Medicaid. Maybe there is another strategy that, based on your situation, works best for you. Your experienced and professionally trained attorney is there to assist you.

What Income is Included?

Most sources of income will be counted towards your eligibility equation for Medicaid. Income such as wages, alimony payments, annuity payments, Social Security Income, Social Security Disability Income, and IRA distributions may all count as income resources.

If you are married, and your spouse will remain in the home, also referred to as a “community spouse,” their income is not counted, and they have a certain level of protection to keep them from being impoverished. This protection is typically in the form of a Monthly Maintenance Needs Allowance, or the state of New York; it’s called Community Spouse Monthly Income Allowance. This monthly limit allows the spouse entering the nursing home to transfer some or maybe all of their income to the community spouse, so it doesn’t count toward their income for Medicaid eligibility.

However, if your spouse makes more than the limit (set by each state), you may not be able to utilize this option. Speak with your attorney to fully understand the limitations and how to proceed.

What Assets Are Included?

Nearly all of your assets will be factored into the eligibility equation, making planning and protecting them imperative. Assets such as cash, stocks, bonds, vacation homes, all bank accounts, and investments will all be considered.

Generally speaking, your house, car, personal belongings, burial funds (planned and designated) up to a certain amount, and life insurance up to a certain amount are not included in your assets as eligibility. Most IRAs or 401Ks in payout status (or dispersing the Required Minimum Distribution) are exempted from the included assets.

How Can I Ensure That I Am Eligible?

By working with an estate planning attorney and going through all of the options that you have available to you, you can formulate a solid plan that you and your family can rely on. For example, maybe you choose to spend down some of your assets so that they aren’t standing in the way of you benefiting from Medicaid in the future. Maybe you rearrange some assets to achieve the same outcome.

Changes in the system occur often, and the look-back period may be changing soon, which can mean that planning in advance can look differently than it does today. Don’t miss eligibility by a small amount and deny yourself all the programs and services available simply because you didn’t plan.

Call our office today at (516) 253-1366 to get started. We will sit down and go through all of your assets, discuss what options would be best for you, and then work with you to put an effective strategy in place. Your legacy is important. Your family can continue to be provided for later in life and even after you are gone with effective planning.

We look forward to serving you and your loved ones at this important stage of your life.

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What Does New York Medicaid Cover?

Medicaid is a program that is available to low-income adults. Generally speaking, each state has its own Medicaid program following federal standards. However, Medicaid is not to be confused with Medicare, the federal health insurance program.

Medicaid covers other groups besides low-income adults, such as pregnant individuals, children, and those with disabilities. Medicaid covers a wide array of items, such as dental benefits, hospital inpatient and outpatient services, prenatal care, vision care, glasses, medicine, home care, and care in a nursing home, among other things.

Eligibility For Medicaid Based on Income

Individuals and married couples must meet income requirements to be eligible for Medicaid benefits. Income that is included in this equation is employment wages, pensions, Social Security Disability Income, alimony payments, gifts, annuity payments, IRA distributions, and Social Security income.

If an individual’s income exceeds the required eligibility limit, they may not qualify for Medicaid. This is why planning effectively for Medicaid eligibility is such a crucial step in your financial and estate planning for your future and the future of your loved ones.

If you are married, and only one spouse applies for Medicaid benefits, the other spouse’s income isn’t generally applicable. As non-applicant (or community) spouses, they are also eligible to retain a certain income level to avoid impoverishment, which is factored into the income eligibility limits.

This is called the Community Spouse Monthly Income Allowance (CSMIA) in New York. By utilizing the CSMIA, the applicant spouse can transfer some or all of their income to the community spouse, thereby increasing their chances of eligibility for Medicaid by removing the income from their name.

An exception to this allowance is that if the community spouse already has a consistent monthly income of the allowable limit, they may be unable to utilize the other spouse’s income or the CSMIA.

What About Assets?

Assets such as cash, investments, bank accounts (including savings, checking, and money market), stocks, bonds, and vacation homes are countable assets. By countable, they would qualify towards the asset limit for eligibility for Medicaid.

Non-countable assets such as your home, household items, and personal belongings are generally considered non-countable assets and won’t be factored into eligibility limits. Other non-countable assets can include burial funds set aside of up to $1,500 or your vehicle.

Your home exemption may qualify if you plan to return to your home. The value is then generally determined based on the actual value of the house, less any mortgages owed on the property. It is typically exempt if the applicant’s spouse lives in the home.

To calculate, the individual would need to add up the value of all countable assets, ensuring that non-countable assets aren’t included, and if this amount is under the asset limit, that individual would likely satisfy that portion of eligibility.

What is a Look-Back Rule and Why Does it Apply To Medicaid Eligibility?

The look-back period is one of the most crucial aspects of the asset limit eligibility requirement. The look-back period for nursing home care is typically 60 months or five years back from the time of the application. This can mean that Medicaid will carefully scrutinize any assets transferred within five years to outside sources to determine eligibility.

If individuals are unaware of the look-back period, they may inadvertently subject themselves to a penalty period for Medicaid ineligibility. A penalty period discourages applicants from gifting or selling assets under fair market value to position themselves better for Medicaid benefits.

It is important to note that the penalty period of ineligibility typically starts at the time of the application rather than the time the questionable transaction took place, which could mean that the individual is ineligible for another five years. In the case of nursing home Medicaid, however, the look-back period may overlook asset transfers, depending on the circumstances. You should closely review all assets with your estate planning attorney several years in advance to ensure you are not affecting eligibility for nursing home Medicaid.

What Are My Options?

Some individuals will worry that they can not afford nursing home care and choose to exhaust their assets until they become eligible for Medicaid. While this is an option, there are typically better options that you can choose.

In most cases, you can spend down your countable assets. Some of the ways to spend down assets may be to invest in home improvements, pay off debt such as loans, credit cards, medical bills, or your mortgage, or use funds for in-home care before you (or your loved ones) have determined it’s time to move to a nursing home.

New York also has a Medicaid Excess Income Program, which allows residents to avoid ineligibility due to the income limit if they have significant health costs. For example, suppose an individual has consistently substantial medical expenses. In that case, they may be able to utilize their income to cover those costs, establishing that their leftover income is within the income limits for Medicaid. Medical costs may include prescriptions, doctor visits, medical supplies, or other necessary medical expenses.

An Estate Plan That Benefits You and Your Loved Ones

If you are planning for Medicaid eligibility, you may already be one step ahead of the game without knowing it. Several people don’t consider that they may not be eligible for Medicaid and, therefore, don’t plan accordingly. If you found this article, you are likely researching your options and have taken a necessary step in the right direction.

We pride ourselves on listening to and educating our clients. We provide a clear map for the best options based on your needs and create a plan that ensures success for the later chapters of your life. Call us today at (516) 253-1366 to get started.

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Determining Which Assets Have to Go Through Probate in New York

Everyone needs an estate plan, even if you don’t think you have assets of any value or you don’t have children that need to be provided for. Understanding what probate is and how it works is an important part of the process of ensuring that your estate plan is thorough and clearly outlines your wishes. And one aspect of this is knowing which assets go through probate and which don’t.

New York Probate Rules

When someone dies, their assets need to be properly accounted for, the estate settled, and anything remaining passed on to the beneficiaries. This process is called probate, and most estates in New York will go through it. However, estates that are valued at less than $50,000 can skip probate. Instead, these estates go through a process that involves a voluntary administration hearing. This is similar to the traditional probate process but much simpler.

To be able to file a probate petition, the estate will need to have an executor, and there must be a will and an official death certificate. If there is no will and the estate was valued at at least $50,000, an administration proceeding must be filed. The closest family member is generally responsible for filing the administration. In order to get a better understanding of New York probate rules and laws, it may be in your best interest to contact a legal advisor for probate issues on Long Island.

Probate Assets

Most assets of an estate are subject to probate. This includes any real estate property, such as the person’s main home, a second residence, or investment properties, such as rentals. The exception to this is if there are joint owners on any of the property and the terms of the ownership include right of survivorship. Most bank accounts, including checking, savings, and investment accounts, are subject to probate.

All personal property must go through probate. This includes everything from large-ticket items like vehicles or expensive furniture to smaller items like jewelry or artwork. The value of the individual items isn’t relevant to whether they have to pass through probate, as long as the entire estate hits that $50,000 minimum value mark.

Non-Probate Assets

In general, assets that are jointly owned do not need to go through probate as long as one of the owners is still living. This is because the assets automatically pass to the surviving owner upon the other owner’s death. Assets with a named beneficiary, such as life insurance policies or retirement accounts, are also not subject to probate because the asset is already legally required to go to that beneficiary. This includes assets like trusts and retirement accounts.

Another example of an asset that doesn’t go through the New York probate process is a transfer-on-death account, also known as a TOD. These accounts are less complicated than trusts but offer the benefit of being able to bypass probate while also ensuring the beneficiary isn’t able to access the funds in the account until the owner’s death.

What Does the Probate Process Include?

Probate can be a lengthy process, and it’s important to know what to expect. Some people believe that the deceased’s property will be able to go to the beneficiaries very quickly or that any money in the estate will be able to be passed down as an inheritance, but this isn’t always the case. Below is an overview of the probate process in New York:

Filing the petition for probate. This needs to be filed by the executor of the estate and must be filed in the county where the person was living when they died. The petition includes the death certificate, the fill, the petition, and any required filing fees. Keep in mind that it can take several weeks to get an official death certificate, which pushes back the timeline to even start the probate process.
Distributing the notice of probate. Once the petition has been filed, the notice of probate action has to be sent out to everyone involved, including the potential beneficiaries.
Legitimizing the will. This is the main objective of the probate process. If there are no questions as to the will’s legitimacy and legality, this can be fairly simple to do. However, if any of the potential heirs question whether the will filed is the most current one or whether the person was in the proper state of mind, this process can drag on for months.
Determining the assets. Before the estate can be settled, there has to be a thorough assessment of all of the assets, and this is often more complex than it may seem. In many cases, the executor isn’t aware of all the deceased’s assets, and it can take weeks or months to discover and value all of the accounts, property, and other assets.
Paying creditors. Before any remaining inheritance can be distributed to the beneficiaries of the estate, any debts must be paid. For example, the mortgage on a house may need to be paid off or credit card accounts settled. Any debts incurred as part of the funeral expenses or administrative costs must also be paid at this stage.
Distributing the assets. The final step in the probate process is to distribute the remaining estate to the heirs as specified in the will.

How Can I Protect My Assets From Probate?

If your estate is valued at $50,000 or more, there isn’t much you can do to keep it from going through probate, but you can make use of estate planning tools like trusts and transfer-on-death accounts to protect specific assets from the process. The first step is to talk with a New York estate planning attorney to determine what your options are.

If you have questions about which assets are subject to probate in New York or have questions about estate law, call Davidov Law Group at 647-559-8355.

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The Importance of Establishing Guardianship for Minor Children

Everyone hopes to outlive their children, but you also hope that they are adults and well established in life before you pass on. But what happens if you die while your children are still minors? While it can be temporarily uncomfortable to address these issues, making a plan for these worst-case scenarios is vital for the welfare and security of your child.

In situations where there are two parents, the other parent would naturally step in, but this isn’t the case for everyone. If one parent has already passed or is not a part of the child’s life, it’s important to think about who would talk over as guardian for your children. Learn more about how guardianship works in New York, including picking a suitable guardian and how guardianship is established.

Who is a Guardian and What Are Their Responsibilities?

A guardian is a person who is responsible for providing care, maintenance, and support to the minor individual under their guardianship. The guardian of a minor has the same rights as a parent to make decisions regarding their health care, education, religious upbringing, housing situation, and other essential matters. Any individual over the age of 18 with a sound mind can be appointed as a guardian. However, you should make your designation carefully after considering the potential guardian’s values, skills, resources, and availability, as well as the familiarity of the individual with your children. The court maintains oversight of the guardian’s actions, and guardians must file an annual report with the court to update them on the status of the protected minor. 

The duties of a guardian may vary depending on the type of guardianship granted, but some primary responsibilities include:

  • For guardians of the person:
    • Providing proper care, maintenance, education, and support.
    • Supplying food, clothing, shelter, and necessities.
    • Authorizing medical, surgical, dental, psychiatric, and psychological care.
    • Ensuring the protected person is appropriately trained and educated.
  • For guardians of the property:
    • Managing the individual’s money and property strictly in their interest.
    • Preserving and protecting the individual’s assets.
    • Creating an inventory of the individual’s assets.

How Guardianship Works in New York

Establishing a guardianship plan is a way to ensure that you have some say in who will take over raising your child if something happens to you and the other parent. This is done by naming someone, referred to as the guardian, to assume care of the child, who is called the ward. However, there are also other circumstances where guardianship may be needed. 

For example, if a parent abandons or neglects a child, is deported, or is physically or mentally unable to make decisions for the child, a guardian may be needed.

The court is tasked with appointing a legal guardian, and without a guardianship plan in place, your child may be placed in foster care or be put into the care of someone you wouldn’t have chosen. It’s important to understand that while you can make your wishes known through a guardianship plan, it’s not a guarantee. For example, in the state of New York, once a child is 14 years of age, they must consent to the appointment of the guardian. If your child doesn’t want your choice to be appointed, another guardian may be instituted instead.

What Types of Guardianship Exist in New York?

With the assistance of a knowledgeable estate planning attorney, you can create a guardianship plan that will safeguard your minor children, no matter what happens in the future. Several documents may be used to create a customized plan covering every eventuality. New York law makes provisions for at least three varieties of guardianship that can be utilized in different situations.

Standby Guardian

Emergencies can occur anytime and may impact your ability to be present or provide proper care for your child. By completing a Designation of Standby Guardian form, a parent can ensure that their child will receive immediate care from a trusted person without significant disruption if a specified event occurs. A standby guardian is an individual who is given temporary authority to care for a minor child while the parent or legal guardian is still alive, although the standby guardian may petition the court to make the arrangement permanent if the circumstances warrant it. 

The event that allows the standby guardianship to go into effect is known as a “triggering event.” Examples of triggering events may include:

  • Administrative separation between the parent and child, including incarceration, deportation, detention, and other events.
  • Doctor diagnosed mental incapacitation, which renders the parent unable to care for the child.
  • Physical debilitation, such as terminal illness, that causes the parent to consent to the initiation of the standby guardian’s authority.

The parent can specify whether they want the named standby guardian(s) to be the guardian of their child’s property, person, or both. For extra protection, the parent may choose one or several persons to act as standby guardians, in case a named standby guardian is unable or unwilling to assume responsibility when the triggering event occurs. It is important to note that if this designation is being made in anticipation of a specific triggering event, the standby guardianship must be approved by a judge prior to the event taking place. After completing and filing their form, the parent or legal guardian still retains full parental, guardianship, custodial, or caretaker rights and can revoke or cancel the standby guardianship at any time. 

Permanent Guardian

When creating your estate plan, it is crucial to consider who will care for your children long-term if you should pass away unexpectedly. Your co-parent will generally retain the right to be the guardian for your minor children in this event without any action required from the court. However, appointing a guardian in your Last Will and Testament provides protection if you and your co-parent are both deceased before your children become adults.

You should discuss your decision with the person you intend to name as your child’s guardian to ensure they are comfortable with the role and understand any expectations you may have. You may also wish to speak to your teenage children about your choice and allow for their input, as children over 14 may be consulted by the court for their consent before a guardian is appointed.

Guardian of the Property of a Minor Child

New York state law aims to protect the finances of minor children from fraud or mishandling. If a child receives assets valued at $10,000 or more from an inheritance, lawsuit settlement, or another source, a guardian of the property must be appointed. The guardian, working in conjunction with the court, is tasked with managing the child’s money until they turn 18. The designated individual has a fiduciary duty to act in the child’s best interests, and they cannot withdraw any funds without the consent of the court.

Factors to Consider When Choosing a Guardian for Your Child

While any person who is at least 18 years old and of sound mind can technically serve as a guardian for your children, it’s important to choose who will fill this role very carefully. Taking care of a child is an enormous responsibility — as you well know — and the person you choose should be physically able to care for the child, mentally prepared, and emotionally mature and be financially stable enough to support a child.

It’s also a good idea to choose someone who already has a solid, positive relationship with the child, as this can help ease the transition. Many people choose to name the child’s grandparent, adult sibling, or an aunt or uncle as a guardian. However, you may also choose a more distant relative or family friend if you feel they would be better suited.

Remember to factor in parenting philosophies as well as cultural and religious differences. If you want your child raised in a certain culture or religion, it’s important to consider this when you’re choosing a guardian.

Creating a Guardianship Plan

If you need to create a guardianship plan, your first visit should be to an attorney. A lawyer can help you understand how guardianship works in New York and help you make a plan that covers any specific scenario. A guardianship plan can be written into a will or created as a separate document that goes into play with a triggering event, such as a death, incarceration, or illness.

It’s also a good idea to ensure that you discuss your wishes with the person you intend to name as guardian and the rest of your family members, so there are no surprises when and if the time comes. This also ensures that the potential guardian is aware of their responsibilities and has the opportunity to ask questions, express concerns, or let you know that they don’t feel comfortable taking on that role.
Remember that any guardianship plan you create will still have to go through the court system to be put in place, so it’s important that all parties understand what that entails.

Can Guardianship Be Temporary?

Yes, in some cases, guardianships can be temporary. This may be done if there are temporary circumstances that keep the parents from being able to care for and make decisions for their children. For example, if the parent is in the military and is being deployed, it may make more sense for a temporary guardianship to be established so that the child can stay behind where their friends and school are. When the parent returns, the guardianship would be ended, and they would resume responsibility and care for the child. A temporary guardianship may also be used if a parent is very ill or is being incarcerated. A temporary guardian is usually referred to as a “standby guardian” in the state of New York.

How Do You Change or Rescind a Guardianship?

If the guardianship has not been put into place and you just want to make changes to who your appointed person would be, you can do this at any time. All you have to do is create a new document and destroy the old one. If the guardianship is already in place and the guardian no longer wants to or is unable to continue to care for the child, they must file a petition with the courts. The courts will review the circumstances and appoint a new guardian, if necessary.

How Can Our Estate Planning Law Firm Assist You?

Creating a guardianship plan isn’t difficult, and it’s something that’s important to ensure your children are cared for and that you have peace of mind if something were to happen. Whether you need help creating a guardianship plan or you wish to petition for guardianship, Davidov Law Group can help. Call 516-928-6594 to schedule an appointment to go over your case with an attorney.

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Understanding Business Succession Planning

Ensuring that you have a strong estate plan set up for your personal property and assets can make things smoother and less stressful for your beneficiaries and provide you with peace of mind as you live out the rest of your years. But if you’re a business owner, you also need to make a plan for what you want to happen with your company should something happen to you unexpectedly. Keep reading to learn more about what business succession planning is, why it’s important, and how to create a solid succession plan.

Why Business Succession Planning Is Important

You’ve worked hard to build your business and make it a success, so it’s important to plan for the future when you may not be here to oversee every aspect and make every decision. Business succession planning involves making provisions for the transfer of ownership if you were to pass unexpectedly as well as creating processes that ensure that your business can function well without you.

The main objective of business succession planning is to ensure that your business, including the employees and customers who depend on it, faces as little disruption as possible if something were to happen to you. Larger companies are often more inherently set up for this because they may have more stakeholders and more leadership staff who are able to take over and keep things running, but small businesses can face immediate issues without a proper succession plan in place.

The Benefits of Effective Succession Planning

When done properly, a business succession plan can provide many benefits for you personally and your business’s overall health. A business succession plan lets you rest easy knowing your business is in good hands. It’s also good for your business because it means you’ve ensured that your business isn’t dependent on any one person.

You may have heard people in your industry refer to “hit by a bus syndrome,” which means that if any one person at your company was hit by a bus, the business would not be able to continue or would experience extreme hardship temporarily. For example, if only one person at your company knows how to run payroll and they get “hit by a bus” — which can also mean that they quit or are too ill to come into work — payroll can’t go out, which is extremely problematic. Effective succession planning ensures that your business continues to run smoothly no matter what happens.

Business Succession Laws and Regulations in New York

When you’re creating a business succession plan, it’s important to be aware of the various laws and regulations that govern these types of issues, specifically in regards to transfer of ownership. For example, there are specific rules for how much stock can be gifted to someone on an annual basis. Gifting stock is one way to transfer ownership, but if you don’t consult with an attorney, you could find yourself paying hefty taxes.

Another option is to set up transfer of ownership in the business through a trust, but these also have specific guidelines. An attorney can help you understand what type of trust is the best one for your situation and ensure that everything is done correctly to facilitate a seamless transition when it’s time.

The best way to ensure that your business succession plan is in accordance with New York’s rules and regulations is to develop it with the help of a qualified attorney.

Creating a Succession Plan

If you’ve never created a succession plan before and aren’t sure where to start, the team at Davidov Law Group can help. We can guide you through the following steps to ensure that your succession plan is appropriate for your business and has covered every possible contingency.

Assessing the business. The first step is to take stock of your business, including making a list of employees and their roles, customers and clients, vendors, and your profit and loss history.
Identifying potential successors. Once you know what you have to pass on, you’ll need to start identifying candidates to take over the business. You may want to consider both overall ownership here as well as identify employees who could step up into more responsibility if needed.
Plan how to get current employees and potential successors up to speed. If your successor hasn’t worked in the business before, it’s a good idea to get them familiar with what your company does and how it works long before ownership actually transfers. This step is also where you would start crosstraining or promoting the employees identified in the previous step.
Create the business plan. Meet with an attorney to solidify your succession plan and make it official.

Identifying Potential Pitfalls in Succession Planning

One of the main parts of creating a successful succession plan is to take an inventory of the pain points of your business operations. Ask yourself questions like:

What employees would I be lost without?
Is there anything that only one person can do?
Which of my lower-level employees are showing potential for leadership positions?
Who would I trust with my business?

Asking and answering these questions can help you get a better understanding of where you need to do some extra work to ensure that things can run smoothly if something happens. For example, if you have one key employee that seems to keep the place running, it’s a good idea to focus on cross-training others to start spreading out some of those tasks and ensuring you’re not relying too heavily on any one person.

Whether your business is just starting or you have years of profitable dealings, creating a business succession plan should be part of your larger estate planning. Get help ensuring your company’s future is secure when you work with the legal team at Davidov Law Group. Call our office today at 516-928-6594 to get started.

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What is a Healthcare Proxy?

According to the New York State Assembly, the Health Care Proxy Law “allows you to sign a ‘health care proxy‘ and name your ‘health care agent.’

This law provides the ability to name a person in charge of your healthcare decisions should you not be able to make them yourself. For example, if you have dementia or have serious injuries that don’t allow you to make medical decisions for yourself, your healthcare agent can step in and make them for you.

Benefit of a Healthcare Proxy

This law is essential as it allows you to maintain control of who you wish to have making your medical decisions if you are unable. Ideally you will have communicated with this person regarding what measures you approve of to save your life or preserve functions (and/or have provided direction in a Living Will). A healthcare proxy can also communicate and enact other medical wishes, such as whether or not you choose to be an organ or tissue donor. Generally speaking, you can authorize your healthcare agent to have as much or as little control over your medical care as you wish.

Who Should Be My Healthcare Agent?

There are several aspects to consider when choosing your healthcare agent. They must be competent, of sound mind, and at least 18 years of age. The candidate must also be someone you feel comfortable discussing your wishes and concerns with and be entirely trustworthy to ensure they follow your wishes.

The person you choose must also be able to navigate challenging conversations with family, friends, and medical staff regarding your wishes and choices for medical care. Confusion, conflicting opinions, and distress can quickly occur during a medical emergency, and this person must be able to handle these conversations and focus on the priorities without fail.

Will this person be local to me until I need them? Location is another aspect to consider. If you choose a healthcare agent and they move a significant distance away in the future, it will be difficult for them to handle their responsibilities, or they may no longer want to because of the distance. It is important to understand whether or not the person you choose is willing to travel to maintain their duties as your healthcare agent should they (or you) move in the future.

The weight of some of the decisions that may need to be made may be too much for some. It is essential to consider the stress that this person may endure and be confident they can handle it. It is important that you have communicated your wishes to your health care agent, so that they can be confident that they are making the decisions you would have made. The person should also be someone you trust to make decisions about medical issues that you may not have thought to discuss with them in advance.

Common Reasons to Revoke or Change Your Healthcare Proxy

As life evolves, so do our needs and the people that remain in our lives. You may have significant changes to your family, such as death or divorce, that may prompt you to change your mind about your previously selected healthcare agent.

You may have witnessed a significant emergency or change in the health of someone you love, and this experience may prompt you to rethink who you have designated as your healthcare agent.

You may have moved to another state, or your healthcare agent may have moved away since the proxy was created, making you wish to change the healthcare agent. It is important to note that if you move out of state, you should ensure that your current healthcare proxy is recognized and enforceable in the state that you move to.

How Do I Revoke or Change My Healthcare Proxy?

If you choose to make changes or revoke your healthcare proxy, you can simply fill out a new form and destroy the original. You can notify your current healthcare agent, but it is unnecessary. However, several people choose to inform their preferred healthcare providers to ensure there is no confusion in the future. You can also supply these providers with a revised healthcare proxy to convey the change.

If you are legally separated or divorced, and your spouse was listed as your healthcare agent, their rights will be terminated at the time of the legal separation or divorce. By stipulating this information within the proxy paperwork, you can override this and ensure they remain your healthcare agent even after the divorce.

You may also place an expiration date on your healthcare agent’s duties. If this timeline is expressed within the paperwork and has expired, the healthcare agent will no longer have control of your medical decisions.

Another option that you may wish to consider is naming an alternative healthcare agent. By doing so, if your primary healthcare agent isn’t available or can’t make medical decisions for you, the alternative agent can step in and handle the responsibilities for you.

An Important Step in Estate Planning

Establishing a comprehensive estate plan is one of the most caring and thoughtful processes you can complete. It allows for less confusion and questions when your family needs clarity and peace. Think of it as an extra step that you take to protect and provide for your family, even after you are gone.

Our team has over twenty years of experience dealing exclusively with estate planning and elder law. This experience and focus allow us a unique and capable perspective to ensure our clients receive the best insight and tools available to them.

Contact us at (516) 928-6594 to get started today.

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How Trusts Can Help Protect Your Assets

Having a solid estate plan can bring relief in your later years by providing peace of mind that your wishes are clearly stated and that those left behind will know what to expect. While a good estate plan has several parts and may make use of different tools, the trust is one possibility that is often overlooked but can be very helpful in many cases. Keep reading to find out how you can use a trust for asset protection.

What Is a Trust?

A trust is an estate planning tool that lets you transfer assets to another person. When you place the assets in the trust, you also designate a beneficiary — or multiple beneficiaries — as well as a trustee. The trustee is responsible for managing the trust and ensuring that the assets are properly distributed to the beneficiaries according to the terms of the trust. The person who creates the trust is called the trustor.

There are a few different types of trusts, but most people have either revocable or irrevocable trusts. An irrevocable trust is one that can’t be changed after it has been set up. It gets its name from the fact that the trustor can’t change their mind — or revoke the terms. A revocable trust is one that can be changed up until the trustor’s death. These trusts are often more popular because they allow for more flexibility.

You may also hear people use the terms living trust or testamentary trust. A living trust is one that is created while the trustor is still alive. A testamentary trust is one that is set up after the trustor’s death through instructions left in the will.

Using Trusts for Asset Protection

Many people believe that the best way to leave their assets to their children, grandchildren, or other beneficiaries is to outline their wishes in a will. However, wills can be more cumbersome, are harder to change, and can take a long time to go through probate. Using a trust as part of your overall estate plan can give you more flexibility and freedom in ensuring that your assets are distributed as you wish.

Benefits of Using Trusts

There are many benefits to using trusts for asset protection as part of your estate plan, and we’ve outlined some of the most important ones below. If you’re not sure whether a trust is the right option for you or you have questions about how a trust can help you protect your assets, talking with an estate planning attorney at Davidov Law Group is a good first step.

Bypassing Probate

One of the biggest advantages using a trust provides is that assets in a trust don’t have to go through probate. Assets that are set to be dispersed through a will can be held up for months — or even years if the will is contested — which can create problems if those assets are needed quickly to pay for a funeral or other expenses. Bypassing probate also means there are no worries about anyone trying to challenge how you’ve distributed your assets.

Ability to Change Beneficiaries

While it is possible to change how your assets are distributed in a will, it requires creating an entirely new will every time. If you work with an estate planning attorney to set up the right kind of trust, you can have more flexibility in changing the beneficiary without having to change your entire estate plan or draft new documents. Changing the beneficiary — whether you are leaving the assets to someone completely different or are adding beneficiaries — is a simple and easy process.

More Control Over How Your Assets Are Distributed

If you die without an estate plan, your assets automatically pass to a relative, such as a spouse or an adult child, depending on what living family members you have. If you have no family, the estate reverts back to the state of New York. For those who want to ensure that their assets go to a specific place — such as a charity — or person, a trust allows them to make those decisions early on and set everything up so that there’s no confusion later on.

Lower Taxes

Many people choose to use trusts as a way to protect their assets from estate or gift taxes. When done properly, a trust can make a significant difference in how taxes are handled on your estate and assets, which can preserve more of your wealth and assets for your children and other beneficiaries. However, it’s important to recognize that tax laws are complex. If you are planning on using a trust because of the lower tax implications, you need to work with an experienced estate planning attorney who understands which type of trust is your best option and can help you set things up correctly.

Ensure Your Estate Plan Meets Your Needs

While it may be tempting to try to create an estate plan on your own, it’s important to talk about your wishes and the best way to ensure they are carried out with an estate planning attorney. These lawyers have extensive experience helping clients understand their options, and they know what questions to ask and what potential challenges may come up to plan for.
At Davidov Law Group, we understand how important it is for you to know what’s going to happen to your assets after your death. We can help you create an estate plan that works for your situation and let you know if a trust may be applicable and beneficial for you. Call our New York office at 516-928-6594 to speak to a member of our team to schedule a consultation to discuss your options.

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What is a Will, and Why is it Important?

A will is a relatively straightforward document that states how you wish to handle things of importance upon your death. Items such as who will receive assets or property or become guardians of your children are included in a will.

Another critical aspect of a will is who will oversee your affairs and handle them according to your wishes after you are gone. The person appointed with this responsibility is the executor. An executor is a critical role and should not be taken lightly. It is imperative to choose someone for this role who is highly trustworthy, efficient, and able to manage your affairs as you see fit. They may need to be resourceful, as well, and reach out to attorneys or accountants as necessary to ensure your assets are handled effectively. You can also name a secondary executor to step in should the primary executor not be able to carry out the duties when it comes time.

Creating a will is essential to ensure your wishes are communicated and carried out upon your death. Without a will in place, the State of New York will need to determine how to distribute your assets and who will become guardians of your minor children should the other parent not be able to care for them.

What Ensures a Will is Legal in New York?

For a will to be enforceable, it must be written, dated, and signed by you and two witnesses. It is best practice to have your witnesses add their addresses below their signatures. The witnesses don’t need to be aware of the information in the will, just that it is your will, and they are signing as witnesses. From a legal standpoint, a handwritten will without witnesses is legal in New York but is not recommended, so it is best to take the extra step of having two witnesses.

Can I Make Changes to My Original Will Once Completed?

The best way to achieve changes to an existing will is to create a new one. By doing so, you can ensure that the process is handled effectively via the help of a trusted attorney and that your new will is enforceable and complete.

Common reasons to change a will in the future may be that tax or estate laws have changed in your state, relationship status has changed, or you have acquired significant assets since the creation of the original will.

A will can not be changed or revoked simply by crossing out verbiage in the document. You can have a codicil to a will drafted, essentially an addendum. However, the best practice is creating a new will to reflect the changes.

Do Lawyers Keep Original Copies of Wills in New York?

A lawyer may choose to keep your will on file and in a safe place but is not required to do so in New York. It is an excellent option to have an original on file with your lawyer as they typically have fireproof options for original documents, and they can assist the executor upon the client’s death in the initial steps based on the original will.

Your lawyer may deliver you an original copy of your will for you to oversee. The following section will discuss the best and worst places to store your will.

Where Should I Store My Will?

As you can imagine, a will is an essential document to create and store so that nothing happens to it. In most cases, New York probate court will require the original document rather than copies of the will, so you must be able to present the original will when necessary.

If you have a waterproof and fireproof safe deposit box at home, you can place the document there.

If you work with an estate attorney that offers storage of your will in the attorney’s office, this is a great option. They are familiar with you and your wishes as they helped you create your will, so they can easily navigate the transition and guide your executor through the critical steps necessary for your final wishes after your death.

In the state of New York, you also have the option to store your original will with the Surrogate Court. Many find this option appealing because the fees associated with storage are minimal, and as the will is filed with the probate court, there is no room for error upon your death or mistakes regarding your not having a will in place. The drawback to this option is that if you need to make changes to the original wills or create a new will, you may be charged additional fees to retrieve and replace your existing one.

Regardless of where your will is stored, it is crucial to let the executor know where they can access it. They will need to easily access it upon your death to carry out their responsibilities without trying to hunt down a secret hiding place that was not communicated to them and risk issues with your estate.

Do I Need a Lawyer to Create a Will?

The simple answer is no, but it may not be the best approach to handle such an important document alone. An experienced estate lawyer can ensure that you have included all pertinent details, have planned accordingly, and have created a legally enforceable will. After all, you have spent more of your life working towards building your estate, so let’s work together in drafting your estate planning documents to ensure that hard work is protected when it matters the most to your family.

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Handwritten Wills: What You Need to Know

It’s true that you don’t get to take your possessions with you when you die, but you can make sure they end up where you want them to go. When you create an estate plan, you get to decide who will be beneficiaries of your estate and how your assets will be distributed. And an important part of an estate plan is your last will and testament. Find out what the rules are for how wills are created and under what circumstances a handwritten will is valid in the state of New York.

Is a Handwritten Will a Valid Will in New York?

In the state of New York, a will must be dated and signed by the testator. The testator must be at least 18 years old and of sound mind. The will must also be properly signed by two witnesses. If all of these are true and the will is simply handwritten instead of typed up, the will is legally valid as long as it is clear and legible.

A will that is handwritten but is not properly witnessed is called a holographic will. In general, a holographic will is not legally valid in the state of New York except in very specific circumstances, discussed below. Even if a holographic will meets those criteria, it may have a higher chance of being challenged during probate.

Rules for Holographic Wills

A holographic will is only legally valid within New York if one of the three situations apply:

● The testator is a member of the U.S. armed forces and is in active duty service during a war or other armed conflict. “War” has a loose legal definition here and can be either declared or undeclared, but armed forces have to be specifically engaged in the conflict for this to apply.
● The testator is not a military member but is someone who “serves with or accompanies” armed forces engaged in an active military conflict.
● The testator is a “mariner while at sea.”

There have been a few other specific cases where the New York probate courts have upheld a holographic will as valid, but these are rare, and the majority of holographic wills are deemed invalid. If you’re not sure if your situation meets the definition of one of the above criteria for a holographic will to be accepted, talk with a wills attorney who can provide more information.

What Happens If a Will Is Deemed Invalid?

If a will is set aside by the probate courts because it is invalid, there are generally two options. Either the estate is distributed according to the instructions in a previous will, or the person is declared intestate — meaning having died without a will — and the state laws for distributing assets go into effect. The state of New York has specific rules for how intestate estates are distributed:

● If there is a surviving spouse but no children, everything in the estate passes to the spouse.
● If there is a spouse and children, the spouse gets the first $50,000 of the estate and half of what remains. The other half is distributed among the deceased’s legal children.
● If there are children but no spouse, the children inherit the entire estate to be divided equally between them.
● If the person dies without a spouse or children but has immediate family members, the deceased’s parents and/or siblings inherit the estate, depending on what family is there.
● If the person dies with no living relatives, the estate reverts back to the state of New York.

Keep in mind that for these guidelines, legal children means that it is the person’s biological children or adopted children. If the child was born outside the marriage, legal paternity must have been established for the child to inherit.

Working With an Estate Planning Attorney

To give your will the best chance of going through probate without an issue or being challenged, it’s best to work with an estate planning attorney who can help you draft a will and ensure that it meets all the legal requirements. An attorney can help you understand what laws apply to those you name as your beneficiaries. For example, in New York, you must leave some of your estate to a living spouse and any minor children. If you don’t, the will can be set aside because the law requires that you maintain adequate provisions for dependents.

A lawyer can also help you understand how your will functions as part of your larger estate plan and whether other tools, such as establishing a trust, may be a better option to handle some of your assets. A will is a valuable tool, but it does have its drawbacks. For example, the probate process can be quite lengthy, so if there is an immediate need for property or funds to be used directly after your death, these may be inaccessible for several months if they are in a will as opposed to a trust.

There are many reasons someone may consider a handwritten will, but it’s important to understand that trying to create a will on your own without following the proper guidelines can mean that your will ends up being thrown out and your estate may not be distributed according to your wishes. If you need to create a will or want to know how to alter or rescind a will that is already made, contact Davidov Law Group at (516) 928-6594. A member of our team can help you schedule a consultation so you can understand what you need to ensure your will is valid and how to protect your estate.