Laurie's Lines

2012-01-04T15:36:00.001-05:00

Just saw President Obama at Shaker Heights High. Great speaker. Got to shake his hand. Not as tall as I thought, but looks younger!

2011-12-29T12:06:00.001-05:00

knowing when to file for social security is not easy--lots of choices and not a lot of guidance http://ping.fm/q0erD

2011-12-09T16:23:00.001-05:00

Money Follows the Person demonstration program transferred a total of 17,000 residents back into their communities as of Aug. 11, 2011 http://ping.fm/YEzer

2011-12-09T16:20:00.001-05:00

“Ohio is ground zero for what will be coming for the rest of the country.” http://ping.fm/40POq

2011-12-09T16:17:00.001-05:00

Ohio loses SNF jobs in wake of pay cuts; sign of what's to come for nation, experts say http://ping.fm/pSRwO

2011-12-09T15:59:00.001-05:00

Tell me, Wisconsin, have you seen these savings? Wisconsin Medicare Beneficiaries See Significant Savings in 2011 http://ping.fm/gXOik

2011-12-09T15:49:00.001-05:00

Maryland audit finds Medicaid funds paid to out-of-state dead people. Stop this and would help the budget! http://ping.fm/EoLIi

2011-11-20T18:23:00.001-05:00

Indiana Veterans must endure huge backlog for benefits, and this it true all over. http://ping.fm/VesoN

BLOODLINE TRUSTS TO KEEP ASSETS IN YOUR BLOODLINE

2011-09-06T17:32:00.000-04:00

When Sharon was planning for how her assets would pass to her four children, she envisioned an easy transition. She had read all the articles on avoiding probate, setting up trusts, and organizing her affairs. She had even spoken to her children about her wishes (a very difficult thing to do). All of her children had wonderful relationships with each other and the assets were to be divided equally. After Sharon died, the transition was easy; each of her children received an equal share of assets and everyone was happy. Unfortunately, shortly thereafter the real trouble began.

Her number 1 son was a doctor. He had a good practice and he thought his patients were happy. One was not, and sued him above his malpractice insurance levels, and WON! Suddenly all of this son's assets, including Sharon's legacy, were gone.

Daughter number 2 was married with 3 children of her own. She thought she would follow her mother's estate plan when she died, since things had progressed so smoothly. Suddenly her husband filed for divorce, and demanded half of all assets, including Sharon's. After a terrible legal battle (which cost thousands in legal fees), most of Sharon's money was gone.

Daughter number 3 was ill most of her life, but had a terrific husband who cared for her, along with a faithful nurse and two children. When she died, she left everything to her loving husband, who promptly married the nurse. He added her name to all the assets. When he later died, everything was left to the nurse. Daughter number 3's children got nothing.

Son number 4 was single, and had never had much money. After receiving Sharon's inheritance, he felt rich and proceeded to buy all the thing in life he had never been able to afford. Before too long, all the money was spent and he was no better off.

What happened? This was not what Sharon had planned so carefully for. She missed one critical step: protecting her money even after she was gone. But how? With a BLOODLINE TRUST! This starts out like a simple Living Trust while Sharon is alive. She has full access to and control of the funds. Upon her death, the assets avoid probate, but instead of distributing outright to her four children, the assets are divided into four separate trust shares to be held for each of her children for life. Each child can have access to his or her share for everyday living expenses, but does not receive the lump sum in one chunk. The share held in trust is protected from the lawsuits, divorce, death or crazy spending of the children. Yet the money is there if needed. Plus, when each child dies, his or her remaining share is left to his or her children, Sharon's grandchildren, whom she adored and wanted to benefit if she could.

This simple, but often overlooked, planning tool would have been the answer to Sharon's prayers, and could be perfect for you too. See an attorney who focuses on Estate Planning and Probate Avoidance to establish a Bloodline Trust.

How to Spot and Stop Elder Financial Abuse

2011-08-08T11:47:00.000-04:00

Sadly, financial abuse of elders is not uncommon. It’s even sadder when the abusers are the children or other relatives. Financial abuse of elders is a huge problem! According to the National Center on Elder Abuse, over 2 million senior citizens are affected by financial abuse. It is the number one crime committed against people over age 65.

It is important for everyone to be aware of the signs that financial abuse may be happening. Here are a few signs to watch for: (1) Sudden changes in a senior’s banking or financial habits or names added to accounts; (2) Large unexplained credit card charges or large bank withdrawals; (3) Sudden changes in estate planning documents like powers of attorney and wills; or (4) Seniors who appear to be bullied or directed by someone else, refuse to speak up for themselves, or appear nervous, especially when asked about their financial matter.

There are some common situations where elders could be affected by financial abuse. We have seen many instances where a senior, often a widow or widower who is alone, lonely and aging, fall prey to the many mail and phone solicitations that we all receive. A friendly voice on the phone tells them they can receive a wonderful gift or win a prize. They only have to send in a “small fee” for processing, and the senior sends in money for all the requests. There are also door to door “salesmen” who ask for money for painting, roofing or other repair work. Stock brokers may encourage unnecessary frequent purchases or sales to earn commissions. And, most sadly, we do see children or friends that the senior trusts taking advantage of that trust by asking for money or even bullying the senior into giving them money or purchasing items for them.

There are steps to take to prevent this kind of abuse! First, have a heart to heart talk with the person. Maybe they will realize what they are doing and learn to recognize the warning signs themselves. Also if loneliness is contributing, be the friendly caller and encourage socialization. Put yourself on the bank accounts with a restriction that requires 2 signatures for withdrawals (with the permission of the elder, of course). Watch the mail, have duplicate bank statements sent to your home. You may even want to change the mailing address to your own. Get the senior on “Do not call” and “Do not mail” lists by going on-line at www.donotcall.gov or calling 1-888-382-1222, or mailpref.org to stop unwanted mail delivery. Change the victim’s telephone number, even to one that is unlisted, if the calls don’t stop. If these tips don’t work, you may have to report the suspected abuse to the county adult protective services. They will investigate the report, and will not release the name of the caller. Finally, if the person is not competent, you may need to obtain a guardianship over them to allow court intervention as a last resort. Help protect yourself and others from financial abuse!

Copyright © Budish, Solomon, Steiner & Peck, Ltd. This article may be reproduced with proper attribution to the law firm of Budish, Solomon, Steiner & Peck, Ltd.

2011-07-27T13:37:00.001-04:00

Some health insurance help for those with pre-existing conditions http://ping.fm/hYm56

2011-07-03T17:37:00.001-04:00

Ohio state budget packed with changes
http://ping.fm/lmgNS

VETERANS BENEFITS PLANNING

2011-06-17T15:43:00.000-04:00

Would you like to uncover some extra cash to pay for all those home-related medical expenses? We are not talking about finding a few nickels and dimes.... We are talking about discovering ten or twenty thousand dollars a year! The program is the VA aid and attendance benefit.

How much cash can we get under this wonderful program? The top amount is $19,736 if you are single, and $23,396 if you are married. So that’s real money.
There are a number of requirements. Most important, you or your spouse must have served in the military for 90 days, at least one during wartime, and you must not have a dishonorable discharge. You must need help with activities of daily living, like dressing or bathing. And your savings, apart from your home and car, must not exceed ABOUT $40,000 if you are single, or ABOUT $80,000 if you are married.

The value of the house doesn’t matter when qualifying for benefits as long as you are living there.

You can even give assets away in order to qualify for this benefit. You can give money to children or others, or you can put assets into an irrevocable trust. And this is different from Medicaid: there is no penalty or look back period for these VA benefits. That means once you transfer excess funds, you can immediately apply!

Although this sounds like a good deal, give it some thought prior to simply giving away assets to qualify for aid and attendance benefits. There are a number of reasons why you might not want to give up your assets. You lose control. If you give assets to kids, you become dependent on them, and if you want your assets back the “happy recipient” may or may not give them to you. If you put assets into a trust to protect them, the trust must be irrevocable, and that means you can’t later change your mind and take them out. And maybe most important, giving assets away or putting them into trust may make you ineligible for Medicaid for as much as 5 years. While there’s no look back period under VA benefits, there is under Medicaid.

If you one of the many folks who are eligible but haven’t taken advantage of valuable VA aid and attendance benefits, you need to consider it. The benefits are under used, yet they can be a life saver. If your assets are a little too high, you may be able to take steps to qualify anyhow. But talk to an experienced elder law attorney who is certified to handle VA claims so you don’t make the wrong move.

Note that I am an Accredited attorney for the preparation, presentation and prosecution of claims for veterans benefits before the Department of Veterans Affairs (VA).

Copyright © Budish, Solomon, Steiner & Peck, Ltd. This article may be reproduced with proper attribution to the law firm of Budish, Solomon, Steiner & Peck, Ltd.

The New Federal Estate Tax Laws For 2011 and 2012

2011-05-31T12:55:00.000-04:00

Federal Estate and Gift Tax changes for 2011

1. How much is free of Estate and Gift tax? For 2011 and 2012 the exemption from Federal exemption for estate, gift and generation skipping transfers is $5 million dollars. Beginning in 2012 the exemption is adjusted for inflation. The exemption also applies to deaths in 2010 if elected. If Congress does not act then the law reverts to the Pre-Bush tax cuts, a $1 million estate and gift exclusion and a 55% tax rate.

2. I heard that I can use my predeceased spouses exemption- Yes, under the new law if your spouse dies after 2010 and has not used her $5 million exception; the surviving spouse can use the exemption. This may eliminate the need for a trust for both the husband and wife. This also makes second marriage tax planning more complicated if there is substantial wealth involved.

3. What is the rate of the Federal Estate and Gift tax? – 35%.

4. How much money can I give away free of tax? - For 2011 and 2012 the lifetime exemption is $5 million which means that you can give away that amount in your lifetime. There is no gift tax or income tax due on a gift. There is some concern that if you give a large gift and the law reverts to the old Pre-Bush exemption you could end up paying tax on the gift when you pass away. However the use of the larger $5 million exemption makes sense if you can afford it because all of the growth of the asset will be out of your estate.

5. What about the $10,000 gift amounts? – In addition to the lifetime exemption for gifts of $5 million dollars, every year you can give away $13,000 (it used to be $10,000 but has increased due to inflation) free of any gift tax to as many people as you want. For example if you have three kids, you can give them each $13,000 free of gift tax each year and still retain that $5 million dollar exemption. If you are married you can give $26,000 to each child plus you have a $10 million dollar lifetime exemption. The only people who should worry about the gift tax are people with very large estates.

Example- Mr. and Mrs. Jones have a home and assets worth $1 million dollars. Their son needs $50,000 to make a down payment on a house. Mr. and Mrs. Jones could give their son $50,000 with no tax consequences and never have to worry about taxes. A gift tax return should be filed.

6. Do the new estate laws impact my income tax? The new law puts back the income tax basis laws that existed prior to 2010. If someone dies in 2011 or later all capital gains are wiped out.

Example- You bought stock for $1000 and it has grown to $101,000. If you sell the stock or give it to your children and they sell the stock the Ohio income tax and the Federal capital gains tax could be as high as $20,000. Under the new tax law ( and under the law that existed prior to 2010, ) if you die holding the stock the capital gains is eliminated so if the stock is sold after your death there is no income tax due.

7. Do I need to revise my estate planning documents? – This depends on what your documents do. If you had a trust and you thought you had a federal estate tax problem when the trust was drafted, it may have language in it that will not be appropriate for you.

Example: Mary and Tom Jones husband and wife set up trusts in 1999 when they thought there were going to be subject to Federal estate tax. Now there estate is $2 million dollars split evenly between them. Tom Jones dies and all of his money goes into a Family credit shelter trust. Mary passes away 10 years later and the Tom Jones trust increased to $2 million dollars and so did Mary’s personal assets. The assets in Tom’s trust did not receive the step up in income tax basis on Mary’s subsequent death and on liquidation of the investments on Tom and Mary’s death Tom’s trust owes a combined Ohio income and Federal capital gains tax of $200,000 on the growth.( This assumes no sale of assets during the trust term.) If instead they had modified there documents so that all of the assets were taxed in Mary’s estate they would have eliminated the Federal and Ohio income tax( They would have to pay additional Ohio estate but much less than the extra income tax in this example.)

Example- Harry and Sarah Smith have an estate of around $2 million dollars and want to prepare estate planning documents. Assuming that they do not care about Ohio estate tax liability and assuming they want a trust They should consider a joint trust so that they have all of the benefits of a trust and the step up in income tax basis.

8. What about Ohio estate taxes? - Ohio has had an estate tax in its present form since 1968 but had some sort of inheritance tax as far back as 1893. Right now if you are an Ohio resident you will pay an estate tax if your estate is worth more than $338, 333 dollars. The maximum tax rate is 7% on estates over $500,000. The tax is typically due on the second death of a married couple and with the right planning a good portion of the tax can be avoided. However without the correct planning a couple with an estate of $1 million dollars could owe $$58,000 in Ohio estate tax. Legislation has been proposed to repeal the Ohio estate tax effective January 1, 2013.

9. What about Ohio Gift Taxes? Ohio does not have a gift tax. You can give any amounts away during life and there is no Ohio tax. However Ohio does have three year gift in contemplation of death rule. Gifts above $10,000 are presumed to be in contemplation of death if made within three years of death and included in your Ohio estate tax. You can dispute this assumption.

2011-05-10T15:16:00.001-04:00

Another reason to strongly dislike LeBron. LeBron James Under Fire For ‘Retarded’ Comment http://ping.fm/qXwbD

2011-05-08T17:38:00.001-04:00

What Happens to Current Nursing Home Residents if the House Budget Resolution Becomes Law? http://ping.fm/uHCYU

2011-04-22T16:31:00.001-04:00

I am speaking in Cleveland on this topic: Elder Law: Sophisticated Techniques and Challenges
See: http://ping.fm/fG8SE

2011-04-22T16:30:00.001-04:00

Check out this NBI teleseminar I am doing on What Every Attorney Needs to Know About Common Public Benefit Programs
http://ping.fm/AMsOK

CUT YOUR MEDICAL BILLS

2011-04-18T15:24:00.000-04:00

Health care costs are high enough, so you certainly don’t want to be over-paying. That’s right. According to one study, 8 of 10 hospital bills contain billing errors.

Medical billing mistakes are really common. Charges are typically based on a patient’s diagnosis code, and a mistake in the code can result in a higher bill than is appropriate.

As an example, here’s one recently reported in the consumer reports money adviser. A person stepped on a piece of glass and went to a podiatrist to have it removed. The procedure took just a few minutes, but the bill came back at $363. When the patient followed up, he found that the billing code was incorrect. Two codes were used: one for a new patient evaluation which lasts 20 minutes, much more than the actual time spent. And the second for “removal of an object by incision,” though no surgery was actually involved. After the patient brought these apparent coding errors to the insurer’s attention, the codes were corrected and the bill was reduced from $363 down to $77.

These codes are complicated. What can we do, since we are not medical experts, to check to make sure our bills are correct? Here’s no easy answer. First ask your doctor what procedures he’s doing at the time of service so you can compare the bill and the explanation of benefits closely. If something seems wrong, or the bill seems too high, call the hospital, doctor, lab, or insurance company. You have a right to know what the charges are for and what the codes mean. If you cannot get a straight answer, or you believe that there’s a mistake that the provider or insurer refuses to correct, then contact the insurer’s fraud department, or the Medicare company that paid the claim, or the state insurance department. In Ohio, the insurance department website is http://www.ohio.insurance.gov/, and the fraud division telephone number is 1-800-686-1527.

Even if Medicare or insurance has paid your bill, you still need to take action. If Medicare or your private insurance company is paying mistakenly inflated bills, we all end up paying more. We all need to check our bills closely and make sure they are not mistakenly inflated.

Check your medical bills closely, and contact the doctor or hospital if it doesn’t add up. You certainly don’t want to pay too much. If we all take a few moments to watch for mistakes, we can do our part to keep Medicare and insurance costs down.

2011-04-08T12:19:00.001-04:00

What to do if you haven't filed your taxes yet OR CAN'T AFFORD THE PAYMENT? See this article: http://ping.fm/IyW5Q

2011-04-07T19:51:00.001-04:00

Block grants: The best medicine for Medicaid? I am not sure I agree with this opinion--what do you think? http://ping.fm/cKVkk

SHOULD YOU AVOID PROBATE, AND IF SO, HOW?

2011-04-06T16:15:00.000-04:00

PROBATE. The mere word sends shudders down many people's spines. Your friends and neighbors have probably told you horror stories about experiences they have had with a loved one's probate. It seems today that everyone is telling you to avoid probate. But should you avoid probate? The only way to know the answer to this question is to understand what the probate process is. This is a decision that involves the ownership and disposition of your assets, and should be a decision made only by you, not by the media, not by your neighbors or friends, and not by your family.

What is probate? Probate is simply the legal process whereby your will is determined to be valid, your assets are gathered together and inventoried by the Probate Court, your debts and taxes are paid, and your assets are finally distributed to the rightful heirs. Only assets in your individual name alone are probated. Therefore, if a bank account is titled in the name of "John Smith," when John dies, that bank account will have to pass through probate in order to be distributed to the rightful beneficiary. The Probate Court judge monitors the probate process. A person named in your Will to handle your probate estate is called an "Executor."

The Executor prepares and files an Inventory of the assets held in your name alone at the time of your death. The Executor must pay any final expenses and file an Estate Tax Return for the estate. Please note that whether or not probate is avoided, Estate Taxes generally cannot be avoided. Finally, the Executor handles the most important part, distributing your assets to the rightful beneficiaries.

There are costs and other issues involved in the probate process which must be evaluated. The main cost in the probate process is attorney's fees. Attorney's fees can range anywhere from 2% to 10% of the total value of the assets for probate purposes. Additionally, court costs can be expensive, often ranging as high as $400-$500 for the probate. Finally, your Executor is entitled to a percentage fee ranging from 2% to 4% of the assets. The probate process itself can take as long as six months to a year in simple cases and as much as three years in more complicated probate estates or if litigation is involved. Finally, another problem with the probate process is that the court filings all become public record. Your neighbors can go down to Probate Court, pull your file, and see what assets you owned, how much your bills were, and who is receiving your estate. Many people do not like the public record aspect of the probate process. On the other hand, if there are family issues or complicated assets, the court oversight in probate might be desirable.

If you determine that you want to avoid probate, there are various ways to achieve that goal.

Assets on which you name a beneficiary do not pass through probate. For example, retirement plans, IRAs, annuities and life insurance which are owned by you, but which have a named beneficiary, do not go through probate. These assets pass to the surviving beneficiary by virtue of the contract which you enter into with the financial institution holding the asset. For assets such as these, it is important to be sure that a beneficiary is always named. Additionally, it is always important to name a contingent or successor beneficiary on these types of assets.

For real estate, bank accounts, stocks and bonds, and other types of liquid assets, many people swear by owning these assets "jointly with right of survivorship." Ownership in this manner does avoid probate; however, it can have some unexpected adverse consequences for you. For example, if you have a bank account held jointly with rights of survivorship with your son, you both are owners on the account and have complete access to all of the money. Your son could take your money and close out the account. Additionally, if he has creditors pursuing his assets, they may also pursue your bank account because he is a joint owner on it.

These types of problems can be avoided by avoiding joint ownership. Instead, you should own these assets individually, but name a beneficiary to take those assets upon your death. For bank accounts, this means titling a bank account in your individual name with a Payable On Death ("POD") designation to a named beneficiary. For real estate, cars, stocks and other securities, it means titling the assets in your name individually with a Transfer On Death ("TOD") designation to a named beneficiary. This prevents your beneficiary from having any ownership rights in your assets until your death, at which point they inherit the asset outright. Keep in mind, however, that if your named beneficiary dies before you do, and you fail to name another beneficiary, your assets will have to go through probate because it will be in your name alone with no living beneficiary.

There are drawbacks to such asset titling, as noted above. In many circumstances, probate avoidance using a Trust Agreement can be a better way to hold your assets and also can allow you to achieve significant estate tax savings in the process. A Trust Agreement is simply a legal document which has three parties to it: (1) the Settlor (that's you) who sets up the Trust; (2) the Trustee (often the same person as the Settlor) who administers the Trust according to its terms; and (3) the Beneficiary (again, usually the same person) of the Trust for whom the Trust is held. The most important part of establishing a trust is the funding, titling your assets into the trust, which is necessary in order to avoid probate. A trust can be a great probate avoidance, property management, and estate tax savings tool.

Ultimately, the choice is yours, with input from your estate planning team: your attorney, accountant, tax preparer and family.

Copyright © Budish, Solomon, Steiner & Peck, Ltd. This article may be reproduced with proper attribution to the law firm of Budish, Solomon, Steiner & Peck, Ltd.

2011-02-24T13:49:00.001-05:00

Got my certification to represent clients before the VA! Lots of benefits people don't know about. Check it out. http://ping.fm/3jnye

2011-02-24T13:35:00.001-05:00

CLASS act being reorganized into the Administration on Aging http://ping.fm/1yrKr

2011-02-24T13:33:00.001-05:00

One in eight Boomers will die of Alzheimer's. This scares the heck out of me! http://ping.fm/d5TJY

Fraud Reimbursement

2011-02-20T19:07:00.000-05:00

The Ohio Attorney General announced that a $26 million dollar settlement with a company called Care Source, which is a managed health care company. The settlement involved allegations of Medicaid fraud by the company. As a part of the settlement, two people who initially reported the fraud will share in a part of $3 million dollars receive by the Federal Government.

If someone turns in a person or company for cheating the Federal Government, can they receive some of the money?

In certain situations, yes. Under the Federal False Claims Act, if someone knows of a fraud against the U.S. Government, they can sue on behalf of the government and receive between 15-30% of the funds recovered. For example, a recent settlement agains a pharmacy comapny annouced by the U.S. Government resulted in five (5) whistleblowers dividinng approximately $40 million dollars as their share of the settlement.

What sort of claims are allowed?

The list is unending, but here are some examples:
- Overbilling for medical services;
- Overbilling for prescriptions, such as billing for brand name drugs when generic draugs are actually provided;
- Double billing for supplies to the government;
- Winning a contract through kickbacks or bribes

According to the Taxpayers Against Fraud Education Fund, the Federal Government has received more than $3 billion in settlement recoveries from false claims lawsuits, with 80% coming from the health care industry. However, even something like education has been caught. The University of Phoenix settled a $67 millions dollar claim that they paid college counselors to send students to the school.

Why did Congress pass the False Claims Act?

The idea is that the Federal Government just cannot police all of the fraud out there. By providing an economic incentive for individuals, it is hoped that private individuals will help the government catch the crooks.

Does Ohio have such a law?

Presently, there are 28 states that do have laws similar to the Federal Law, but Ohio currently does not have the equivalent of the Federal False Claims Act. If you think you know of a fraud being committed against the Federal Government, you should contact an attorney. You can also go to www.taf.org, which is the Taxpayers Against Fraud Education Fund to start your initial research into the field.

2011-02-06T13:34:00.001-05:00

Happy Super Bowl Sunday. I have seen so much hype that I thought I should make this wish like it was a holiday or something.

CAREGIVING AGREEMENTS

2011-01-19T14:26:00.000-05:00

Congress is continually making it more difficult to protect your home and life savings from expensive nursing home care. It’s difficult, but it’s NOT impossible! Here is a useful technique to protect your assets from Medicaid, called Care Agreements.

First, some background. Lots of times children and other family members provide care to help mom or dad stay at home. Maybe it’s driving mom to the doctor, or picking up groceries. Perhaps it’s more extensive, like putting out the medications every morning, or helping dad dress and bathe. And sometimes it may mean living with mom or dad because they can’t be left alone. This work can be hard, physically and emotionally. Yet, most times kids provide this help without expecting to get paid.

But here’s the planning tool. Plan ahead for nursing home care by paying a child or other family member for services provided. Here’s an example. Say dad has $100,000. His daughter has provided all kinds of care for years, for free, just because she’s a good daughter. When dad has to go to the nursing home, he can’t just give away his money to his daughter—that will be penalized. His entire $100,000 will go to the nursing home before he gets Medicaid. But if dad has planned ahead and pays his daughter for help, he could protect some or all of his savings. Let’s say he pays his daughter $4,000 a month for her hard work. In two years, his entire $100,000 would have gone to his daughter, not the nursing home. If he then goes to a nursing home, Medicaid will pay.

One of the tricky issues is setting the appropriate payment amount. It must be a fair amount for the services provided. You can’t pay a child $10,000 for one trip to the doctor. But you could call a professional caregiving service and get a written estimate for the care your parent needs, then use that to set your fee. Also, services must actually be needed by the parent.

The agreement needs to be formalized by a written contract drafted by a lawyer. Otherwise, Medicaid may say these are gifts, not payments for services. And gifts are penalized. Additionally, Medicaid won’t let you pay afterwards for services provided without a written contract. You can go forwards, but not backwards.

Most people are willing to pay their fair share for long term care. But you shouldn’t have to lose everything you’ve worked so hard for. A caregiving agreement is one of the many legal strategies that allow you to protect at least some of your life savings.

2011-01-08T14:02:00.001-05:00

Bedbugs are going to strain Ohio's Medicaid budget--who would have thought? http://ping.fm/dBLij

2010-12-23T12:38:00.001-05:00

Two bills pass Congress to aid seniors and disabled with affordable housing http://bit.ly/g43Zzd

2010-12-21T14:44:00.001-05:00

Try a stretch IRA--We do this for our clients. Maximize benefits, minimize taxes http://ping.fm/LpH5i

NEW RULES FOR APPEALS OF HEALTH INSURANCE CLAIM DENIALS

2010-12-14T15:37:00.000-05:00

Your health insurance claim is denied, and you disagree. So you appeal. But the appeal seems more like a kangaroo court, since the insurance company itself decides your appeal. If that doesn’t seem fair to you, you are not alone. It didn’t seem fair to congress either, and they have now changed the rules.

Insurance companies make a variety of decisions that affect consumers. For example, your claim for medical care, or a hospital visit, may be denied. Or your health insurance coverage might be cancelled. Typically, the insurance company provides a procedure to appeal its decisions. And in most cases, the appeal is to the insurance company itself.

The new health care reform law provides for new regulations that expand consumer appeal rights. Maybe most important is the right to have your appeal heard by an independent and external review board. While we are still waiting to learn all the details of how this will work, your appeal now can be heard and decided by people who are not employed by the insurance company itself.

If you work for a company that offers its own health plan and does not contract with an insurance provider, the new right to an independent external appeal process applies to this situation too. Everyone who gets a new insurance plan is covered. The old rules still apply until your plan changes.

It makes a big difference to have an external review process. No matter how much the insurance company tries to be fair, it has a financial incentive to deny consumer appeals. According to the Kaiser Family Foundation, when external review boards have been used previously, 45% of appealed denials have been reversed.
Insurance company denials of health care claims can be costly, and downright aggravating. And it has been especially frustrating to have an appeal process that doesn’t seem fair. Now, under the new health care law, appeals should give you a good chance for a fair hearing.

Copyright © Budish, Solomon, Steiner & Peck, Ltd. This article may be reproduced with proper attribution to the law firm of Budish, Solomon, Steiner & Peck, Ltd.

2010-12-12T15:09:00.001-05:00

Four Practical Steps of Advance Planning for Alzheimer's Care http://ping.fm/wPpMC

Q & A about year end tax planning 2010

2010-12-04T14:27:00.000-05:00

As we approach the end of the year some people think about the Holidays, but you might want to think about tax savings.

Q: What are some good tax planning tips for year end?

A: One major tax planning tip that you should consider completing before the end of the year involves your IRAs and 401ks. If over the years you have accumulated an IRA or 401k, when you start taking the money out you pay income tax. However for certain people it may make sense to convert their IRA or 401k to a Roth IRA or a Roth 401k. Not all employees will be eligible to convert their 401k. The advantage of a Roth IRA or Roth 401k is as follows:

• The money in the account grows income tax free. When the money comes out of the account there are no income taxes to pay no matter how much the account has grown.

• There is no mandatory distribution rule. That means if you don’t need the money you do not have to take any distributions from the account even if you are 70- ½.

Q: Are there any disadvantages to converting to a Roth?

A: Yes generally the income will be taxed to you in the year you convert. For example if have a traditional IRA with $100,000 in it and convert it to a Roth, you must include the $100,000 in income and pay taxes on it. However there is a special rule in 2010 that expires at the end of the year that allows you to split the income between 2011 and 2012. For example if you convert a $100,000 IRA before the end of the year, you can include ½ of the IRA or $50,000 in your 2011 tax return and pay the tax by no later than April 15th of 2012 and include the rest in your 2012 return and pay the tax by April 15th 2013.

Also the inclusion of this amount of income could impact the taxability of your social security for those years and impact the cost of your Medicare premium for a couple of years

Q: Why would anyone want to pay taxes early?

A: That is a good question. Normally you try to defer taxes. This step is not for everyone. You should consider converting to a Roth if:

• You don’t need the money from their IRA to live off of.

• You have extra cash to pay the taxes when the conversion takes place.

• You or your heirs who inherit the Roth will be in an income tax bracket when you take money out equal to or greater than your current bracket.

It could also make sense in other situations. You should sit down with your financial advisor and see if a Roth conversion makes sense for you.

Copyright © Budish, Solomon, Steiner & Peck, Ltd. This article may be reproduced with proper attribution to the law firm of Budish, Solomon, Steiner & Peck, Ltd.

2010-11-15T12:22:00.001-05:00

MetLife to stop writing long-term care insurance. Hope this is not a trend. http://ping.fm/hcLYn

2010-11-09T10:58:00.001-05:00

Ohio's help for stopping smoking, OK, but not enough-http://ping.fm/QDuyu

2010-11-09T10:55:00.001-05:00

Regina Health Care is close to my home, 4 star nursing home, very nice. http://ping.fm/2pNq7

2010-11-04T12:15:00.001-04:00

Ohio's PACE program can keep seniors at home, where they would rather be! http://ping.fm/S8HLr

2010-10-31T14:21:00.001-04:00

Today's Law: Amendment rights for teachers
http://ping.fm/lvPJ0

2010-10-19T14:53:00.001-04:00

Do-it-Yourself Wills Online? Be careful!!
http://ping.fm/ZAXW0

2010-10-19T14:50:00.001-04:00

No COLA for SS in 2011 again. http://ping.fm/8QUTh

2010-10-19T14:49:00.001-04:00

Interesting new twist using coordinated health care-http://ping.fm/xWOc2

401(k) Plans and IRA Popularity on the Rise

2010-09-28T14:30:00.000-04:00

As America ages, the government is taking a closer look at how you spend your 401(k) Plan and IRA.

According to the General Accounting Office, as of 2006, over 66 million Americans were participating in a retirement plan such as a 401(k) or profit sharing plan, a six-fold increase since 1975. Why is the government looking into 401(k) Plans if they have become so popular?

The IRS and the Department of Labor are worried that even though workers are participating in 401(k) Plans, they are not investing the money in a way that will provide them benefits for the rest of their lives after they retire. They are concerned that retired former employees take the money out of their 401(k) in a lump sum, spend it all too soon and don't have enough money to live on later in life.

So in February of 2010, the government issued a notice in the Federal Register seeking comments on if or how the Federal Government should encourage the use of Annuities in 401(k) Plans and IRAs.The government hearing on these issues is scheduled for September 14th in Washington D.C.

Does this mean that the Government will now start telling you how to invest your money in a 401(k) or IRA?

Many people who sent comments into the Department of Labor are worried about just that. For example, in England, over 75% of your retirement benefits must be used to purchase an Annuity by the time you are age 75. The Government already imposes many rules on how you manage your money in a retirement plan. Most people are familiar with the tax penalties if you take money out of a plan too soon or too late. The government is also involved in regulation how much information should be given to plan participants regarding their investment options. However, most experts do not think that the U.S. Government will do what they do in England and mandate that retirees buy Annuities.

What do you think the government will do?

It is too early to tell, but some ideas being considered are :

Mandating that all 401(k) Plans give participants an option to buy an Annuity;
Mandating more employer or plan-sponsored education of participants on investment options;
A default option in a plan that automatically invests your 401(k) in an Annuity, unless you elect out of the Annuity. This is similar to plans providing for automatic enrollment in a 401(k), unless you elect out.

2010-09-19T19:04:00.001-04:00

Ohio Dept of aging says prevent falls. Here's tips: http://ping.fm/Y4HT9

2010-09-13T14:59:00.001-04:00

Social Security Disability: Build A Bullet Proof Case. This is specific to Bi-polar, but still good advice.http://bit.ly/9kxvp1

2010-09-13T13:53:00.001-04:00

Nice simple overview of Ohio Medicaid. There's a lot more to planning though! http://ping.fm/IWIDd

2010-09-10T16:04:00.001-04:00

Outragous! Strongsville, OH Ordinance to restrict where disabled can live. http://ping.fm/pSGYs

2010-09-05T13:54:00.001-04:00

People With Disabilities Make Able Workers http://ping.fm/onD67

2010-09-04T14:17:00.001-04:00

Get Your Well On month in Ohio http://ping.fm/0jBRD

2010-08-27T20:10:00.001-04:00

Great article about special needs kids, quoting ME! http://ping.fm/LaqR3

2010-08-03T13:56:00.001-04:00

Interesting article about online pre-planning for when you die. http://ping.fm/OFLIl

2010-07-30T11:16:00.001-04:00

Medicaid madness:"Look-back" period creates financial hardship for many Americans

Medicaid gift look-back and penalty period big problem: http://ping.fm/eO5jJ

Share this Profile

2010-07-29T19:20:00.000-04:00

Look at me, I'm a VIP! Share this Profile

2010-07-29T18:05:00.001-04:00

Q & A on Federal Estate Taxes http://ping.fm/kV27X

2010-07-19T13:15:00.001-04:00

You need to watch health care providers to protect yourself! http://ping.fm/TikAD

2010-07-14T19:10:00.001-04:00

Consider these things in your search for assisted living. http://ping.fm/YBABW

2010-07-13T21:17:00.001-04:00

State Medicaid cuts looming http://ping.fm/9JcNq

2010-07-13T21:15:00.001-04:00

Berwick now head of CMS http://ping.fm/LLRL4

2010-07-08T22:00:00.001-04:00

Disappointed in LeBron.

2010-07-07T10:59:00.001-04:00

Watch Golden Opportunities Cleve TV-3, Sun 11:30am. Topics: memory loss, back pain help, house call docs, medical ID theft, health reform

2010-07-06T14:54:00.001-04:00

Check out this article on Ohio's new Maternity leave law: http://ping.fm/v4bzm

Reverse Mortgage Industry Taking a Hard Line on POAs

2010-07-06T13:35:00.000-04:00

This article from ElderLawAnswers Newsletter, July 6, 2010, and I thought it was of interest:

Reverse mortgage lenders are now routinely second-guessing the legitimacy of power of attorney (POA) documents, according to industry sources. Presented with an agent seeking to take out a reverse mortgage on behalf of an incompetent principal, banks or brokers are typically asking for a letter from the principal's doctor stating that the senior was competent at the time the POA was executed, or, failing that, a letter from the doctor indicating when the principal's condition began. Based on this information, the lender or broker decides whether or not to proceed with the reverse mortgage application.

The practice is "pretty standardized" in the reverse mortgage industry said Ed O'Connor, president of Advanced Funding Solutions Inc., a reverse mortgage broker. "It is not a HUD requirement, [but] it has become a bank requirement. And just about every bank I know of is doing the same thing. The banks are basically covering their own tail to make sure they're not issuing a reverse mortgage to somebody who doesn't know they're getting a reverse mortgage."

"It's basically becoming a lender requirement," O'Connor told ElderLawAnswers, "and the lenders are certainly allowed to impose stricter guidelines than HUD."

Virginia ElderLawAnswers member Evan Farr raised the alarm about the reverse mortgage industry practice in a recent blog post. The 'note from a doctor' requirement, Farr wrote, is "creating an unnecessary and sometimes insurmountable roadblock for elderly clients who are incapacitated and need a reverse mortgage to be able to afford the home care or home modifications necessary to remain at home and age in place."

Farr noted that the doctor who could affirm that the principal was competent when the POA was signed may have died or retired, with medical records no longer available. Or the principal may have been so healthy at the time of execution that she hadn't been to a doctor in several years.

O'Connor said that his firm has found that doctors will not necessarily answer the question of competence directly, which is why "We ask the doctors for a letter telling us what the person's condition is and approximately when it started." However, he noted that if an attorney prepared the POA, his firm might ask for a letter from the attorney affirming the principal's competence at the time of execution.

"Some banks will still ask for a medical doctor over and above that," O'Connor said, "but it all depends on the circumstances." O'Connor noted that "50 percent of the powers of attorney we see are not actually drawn up by an attorney. They're drawn up by maybe a family member or a notary."

Incompetent Until Proven Otherwise

In his blog post, Farr observed that "the leaders of the reverse mortgage industry are taking the law into their own hands and reversing the time-honored presumption of competence by essentially presuming that all reverse mortgage applicants were incompetent at the time of signing their Powers of Attorney, and forcing the families of these now-incompetent applicants to prove that these applicants were competent when they signed their Powers of Attorney, often years prior to ever applying for a reverse mortgage."

O'Connor conceded that "we have not seen this level of scrutiny on regular mortgages. . . . we've never had anybody ask for this additional documentation. We're only seeing this on reverse mortgages."

The reason from the banks' point of view, O'Connor explained, is that their exposure is heightened in the case of a reverse mortgage. "You have a circumstance where people can tap into a large sum of money all at once and it doesn't have to be repaid. . . . The lender is on the hook."

O'Connor acknowledged that the banks are losing some business because of the policy, but said "it might not be bad business to lose." And he said that in his experience problems seldom arise with a POA. While he sees 12 to 15 POAs a year on reverse mortgage applications, "I can count on one hand the times I've had a problem with a power of attorney."

ElderLawAnswers did not get a response from Wells Fargo Home Mortgage to requests for comment on the practice. Bank of America referred us to the National Reverse Mortgage Lenders Association. Peter Bell of the Association told us that "there is no standard industry practice on this, as far as I know." Bell noted that "this is outside my area of experience" but said "there is no one on my staff at the association that deals with individual lenders' underwriting policies. You'd have to go directly to the lenders." He added that "our association is generally supportive of any additional procedures a lender chooses to implement to safeguard its clients. My guess is that a lender who is requiring this might have been burned by a case where a POA was executed inappropriately."

Illegal Discrimination?

Attorney Evan Farr contends that in turning the presumption of competence on its head, the reverse mortgage industry is engaging in "illegal discrimination in lending, as the reverse mortgage industry is essentially discriminating against disabled and incapacitated adults by imposing obstacles that are not imposed on able, competent adults."

Farr suggests that those who have experienced this type of discrimination visit HUD's Housing Discrimination Complaint Web site and file a "lending discrimination complaint," either online, by phone, or via mail, and encourage clients who have experienced this type of discrimination to do so as well.

"If HUD and the reverse mortgage industry start getting enough complaints about this issue, perhaps they will reverse their position so that the reverse mortgage can once again be a useful tool for the elders that need it most," said Farr.

DO YOU KNOW WHETHER YOU NEED ESTATE PLANNING OR MEDICAID PLANNING?

2010-06-02T18:10:00.000-04:00

Most people don't. I meet with clients all the time who come in thinking that they need to protect assets from the nursing home and find out they really need new Wills, Trusts and Powers of Attorney. Or, the other way around!

Estate planning is the process of providing for yourself and your family in the event of your retirement, disability or death. Through a properly-crafted estate plan, you put your legal and financial affairs in order so that the assets you have accumulated during your lifetime will be preserved and transferred to your heirs with the least amount of financial and emotional cost. The most common estate planning tools available include a Will, a Trust, a Durable Power of Attorney, a Health Care Power of Attorney and a Living Will Declaration.

This encompasses sitting down with your family to plan out some of the most important issues you face. For example, who will handle your affairs when you are incompetent or dead, how do you want to pass your assets to the next generation and what kinds of medical treatment you want OR DON'T WANT at end of life.

You also have to plan to avoid probate, minimize federal and Ohio estate taxes and not leave a mess for your family. Your plan will vary depending upon your family situation, assets and goals and plans for the future. The more your net worth, the more complicated and more important the planning becomes.

Medicaid planning includes many of the same things as you need for Estate planning. However, the main focus is on how to protect and preserve your assets in the event that you need long-term medical care. It can dove-tail with Estate Planning or it can be mutually exclusive.

Often Medicaid planning means trying to qualify for Medicaid benefits, the only government program that will pay for long-term care at home, in assisted living and especially in the nursing home. However, it is a welfare program. You cannot have much in the way of assets or income to qualify.

With nursing home costs running up to $100,000 per year, people need to plan early to legally preserve as many assets as possible. This may include spending your money on certain protected assets or even giving them away. The planning is not easy, and must follow the letter of the law in order to not run afoul of the many regulations that exist. The longer you wait, the fewer options that exist.

You also need to plan to avoid the state's rights to recover any remaining assets from your or your spouse's estate if you die after having received Medicaid benefits. Again, there is not an easy or clear-cut solution.

So, how do you know which kind of planning you need? And, how do you know what specific planning tools you need among the hundreds of tools available? You must to investigate all the possibilities. Please be sure to see a qualified Elder Law Attorney for assistance. He or she will assist you in focusing your Estate or Medicaid plan on your own personal needs and wants. One size definitely does not fit all with these issues!

Ohio's Trust Code Can Cause you Problems!

2010-05-28T16:23:00.000-04:00

     Do you have a Trust Agreement? Many people do for lots of different reasons: probate avoidance, estate and income tax savings and to keep assets in the family bloodline. Trust Agreements have also provided privacy from nosy friends, relatives, or even a nosy Trust beneficiary! However, the Ohio Trust Code, effective January 1, 2007, created a variety of new rights and responsibilities for trustees and beneficiaries that may interfere with that privacy. Be careful-it applies to both new trusts and to trusts created years ago.

     For example, lots of people have a trust that provides for the surviving spouse after one spouse dies. While the surviving spouse is alive, he or she can decide how to invest the funds and can take money as needed from the trust while keeping his or her Trust business private. But the Trust Code creates a new obligation for the surviving spouse. In most cases, he or she will have to provide financial accountings to the other beneficiaries (usually your kids). In other words, you'll have to tell your children how you are investing and how you are spending the trust funds. This disclosure may not cause a problem. However, it could cause a horrible family relationship with your kids. You have to tell them everything you're doing with your money! What if they think you are making investment mistakes or that you are spending too much of "their inheritance?" Giving them financial information about everything you do in the Trust is an open invitation for the kids to be nosy.

     Another problem is that some parents don't treat their children exactly the same at death. To avoid issues, the parents keep this fact a secret within the Trust Agreement. Now, under the Trust Code, the kids are given new legal rights to be able to find out how the others are being handled. This can cause a major family rift between siblings. You hope they will get along after you are gone; not have jealousies or hurt feelings among themselves.

     Trusts rarely have language giving children these kinds of rights to information. But the Ohio Trust Code can impose these rules on trusts even when the trust document itself does not. Plus, not only do the children have these rights, the Trustee has to INFORM THEM of these rights.

     If you don't want your kids to have a legal right to stick their noses into your Trust business and you especially do not want to be required to notify them of these rights, you need to take ACTION! Any new Trust Agreement must waive these rights in its terms. If you have an old Trust Agreement, it will be subject to the law unless you amend the terms of the Trust to include a waiver. The waiver must be in writing and be a part of the Trust Agreement. Don't risk mistakes by trying to make the changes yourself. See an Estate Planning Professional who can explain the new law and assist you with the appropriate steps.

2010-02-23T13:19:00.001-05:00

Watching TV Linked to Higher Risk of Death. OK, so we all should be worried! http://ping.fm/jHMJZ

Debunking Five Common Estate Planning Myths

2010-02-23T11:33:00.000-05:00

Estate planning is the process of providing for yourself and your family in the event of your retirement, disability or death. Through a properly-crafted estate plan, you put your legal and financial affairs in order so that the assets you have accumulated during your lifetime will be preserved and transferred to your heirs with the least amount of financial and emotional cost.

Having an estate plan in place is better than no planning at all. However, having a great estate plan in place is ideal! It can save you and your family thousands of dollars.

Unfortunately many people fall prey to one of the many myths about estate planning. This can cause their families and loved-ones to be left with a smaller inheritance, unnecessarily complicated probate court proceedings, and even costly lawsuits.

Let’s debunk five of those myths!

1. I only have a small savings and checking and some life insurance, I’m too poor to need an estate plan.

NO WAY. Once you take into account the value of your home, your bank accounts, your retirement funds, and insurance policies, you might be wealthier than you thought. Anyone who is concerned about how their assets are managed now and how they will be distributed after their death needs to be concerned with his or her estate plan.

2. Once I complete my Will, that’s the only estate planning document I need.

WRONG. Your Will only deals with your Probate assets after you die. If you become incapacitated during your lifetime, you also need someone to take care of your financial affairs and medical decisions while you are still alive. For that, you need a Durable Financial Power of Attorney, a Durable Health Care Power of Attorney and a Living Will Declaration. Plus, you may benefit from having a Trust Agreement.

3. If I leave everything to my spouse, my assets will never be subject to any Estate Taxes.

NOT TRUE. There is a special Estate tax credit for assets left to a spouse. However, if you simply leave everything to your spouse without some planning, you may be wasting half of the possible credit available.

4. Once I create and sign my Estate planning documents, I am done. Whew, I never have to think about that again!

MYTH. Birth, death, adoption, divorce, debt, changes in asset values and many other factors can affect your Estate planning. You need to review your estate plan periodically, at least every three to five years or when there are major changes in your life.

5. If I enter a Nursing Home, a Revocable Trust Agreement will protect my assets.

INCORRECT. There are many ways to plan to protect assets, but having your assets in a Revocable Trust Agreement is not one of them. For that, you need Medicaid Planning. Revocable Trust Agreements, however, can be useful for probate avoidance, estate tax avoidance and other estate planning reasons.

New Rules for Roth IRAs for 2010

2010-02-13T21:07:00.000-05:00

1. CAN I CHANGE MY TRADITIONAL IRA TO A ROTH IRA?
Yes. Normally when you convert a traditional IRA to a Roth IRA, all of the converted amount is included in income in the year of conversion. However, If you convert in 2010, one half of income is included in income in 2011 and one half is included in income in 2012. The election to make the deferral of income into 2011 and 2012 must be completed by the date of filing of your 2010 Tax Return. With extensions that could be October 15, 2011.

2. WHY WOULD I EVER CONVERT MY TRADITIONAL IRA TO A ROTH IRA?
A traditional IRA grows tax deferred while a Roth IRA grows income tax free. The decision to convert a traditional IRA to a Roth IRA is complicated.
Advantages of Conversion to Roth
• Tax free growth
• No minimum distribution for owner
• Reduces Federal and Ohio Estate Tax
Disadvantages of Conversion to Roth
• Payment of income taxes on IRA early distributions
• Inclusion of income will increase tax bracket potentially
• Will impact taxability of Social Security in the year of distribution
• May increase the cost of your Medicare premium since your income goes up.

3. WHO SHOULD CONSIDER CONVERTING TO A ROTH IRA?
There is no simple rule. The ideal person to convert from traditional IRA to Roth IRA fits the following description:
a. No need to access the money in the IRA.
b. Beneficiary of Roth IRA will be in an income tax bracket at least equal to or greater than the owner. (Even if the tax rate is lower, it still may make sense depending on factors such as time period for accumulation, the rate of removal of assets from the Roth IRA and the source of the funds used to pay taxes on conversion ).
c. Income tax liability is paid with assets other than the IRA.

4. WHO IS ELIGIBLE TO CONVERT?
In 2010 anyone can convert their traditional IRA to a Roth IRA. In 2011, the rule goes back to conversions only if your adjusted gross income with some modifications is $100,000 or less.

5. IF I DECIDE TO CONVERT TO A ROTH SHOULD I CONVERT NOW OR NEAR THE END OF THE YEAR?
• Convert as early as you can in 2010.
• If the market goes up, all of the growth is now in a tax-free account
• If the market goes down, you can change your mind and convert back to the Traditional IRA. If you convert a Traditional IRA to a Roth IRA in 2010, the taxpayer has until he files his 2010 tax return to switch back to a Traditional IRA. With extensions that decision can be made as late as October of 2011 to reconvert back to a Traditional IRA.
• If you convert to a Traditional IRA from a Roth, you must wait the longer of the tax year after you converted to a Roth or 30 days before you can convert again. For example, if you convert to a Roth IRA in the beginning of 2010 and then change your mind on in July of 2010 and convert back to a Traditional IRA, you must wait until January 1, 2011 to elect again to convert to a Roth. If you wait and change your mind on December 31, 2010 then you must wait 30 days, January 31, 2011.

6. IF I DECIDE TO CHANGE MY ROTH BACK TO AN IRA CAN I CHOOSE THE INVESTMENTS I WANT TO RECONVERT BACK TO A TRADITIONAL IRA?
No. You must reconvert the entire Roth IRA back into a traditional IRA. Consequently, you cannot pick and choose which investments to reconvert. For example, you cannot reconvert just the assets that dropped in value. To avoid this problem, set up several Roth IRA accounts when converting with different investments in each Roth. That way you can convert the Roth IRA that dropped in value back into a Traditional IRA while not converting the Roth IRA that increased in value.

7. CAN I CONVERT AN INHERITED TRADITIONAL IRA TO A ROTH IRA?
Yes. The IRS allows a beneficiary of an inherited IRA to convert to a Roth IRA if he satisfies the requirements.

8. WHO SHOULD BE A BENEFICIARY OF A TRADITIONAL OR ROTH IRA?
That answer depends on both your financial situation and who you want to be a beneficiary. The beneficiary could be a spouse, child , grandchild or a specialized Trust for the benefit of a beneficiary or even a charity. A Traditional or Roth IRA does not have to liquidate on the IRA owner’s death if the beneficiary designation is done properly. You should sit down with your lawyer to discuss the options.

9. ISN’T IT TRUE THAT I WILL OWE 70-80% OF MY IRA IN TAXES ON MY DEATH?
No. The 70-80% tax would only happen if you are subject to both a Federal Estate and Income tax. In 2010 there is no Federal Estate tax . In 2009 the exemption was $3.5 million. Even if Congress does reinstate the Federal Estate tax, most people will not be subject to the Federal estate tax so that the IRA will only be subject to an income tax and Ohio estate tax.

2010-02-11T15:23:00.001-05:00

Just because there is no federal estate tax this year that you are clear--states tax you too! http://ping.fm/nfyzB

2010-02-11T15:16:00.001-05:00

Help to find America's best nursing homes-http://ping.fm/5iGUs

Ohio Eliminates Transfer on Death Deeds

2010-01-02T14:48:00.001-05:00

Effective December 28, 2009, Ohio eliminated transfer on death deeds and replaced that deed with a TRANSFER ON DEATH DESIGNATION AFFIDAVIT. Beginning December 28, 2009 you must follow the new rules for transfer on death designations. Set forth below are some questions and answers of the impact of the new law.

1. WHAT IS A TRANSFER ON DEATH DEED?

In August of 2000, Ohio became one of only a handful of states that allowed what is commonly called a transfer on death deed or TOD deed. A transfer on death deed allowed an owner of real estate to create a deed with a beneficiary designation naming who would inherit the real estate on death. The new law does not invalidate transfer on death deeds that were filed prior to December 28, 2009. Arguably the new law does not apply to transfer on death deeds that were executed prior to December 28, 2009 but not yet filed. However, some counties are not accepting for filing TOD deeds that were signed prior to December 28, 2009 but filed on or after December 28.
2. WHY DID PEOPLE USE A TRANSFER ON DEATH DEED?

A transfer on death deed was a good way to pass your home or other real estate to beneficiaries without going through probate. Probate is not an estate tax, but the paperwork process needed to be used to pass assets that are inherited through a will. By using a transfer on death deed the time and expense of probate could be avoided.

3. HOW CAN I AVOID PROBATE ON MY HOME OR OTHER REAL ESTATE?

There are several ways that are typically used. The most common are joint and survivor deeds, trusts and now the new TRANSFER ON DEATH DESIGNATION AFFIDAVIT. As part of the new law eliminating transfer on death deeds, the Ohio legislature has adopted a transfer on death designation affidavit. If properly prepared the transfer on death designation affidavit will pass the real estate to the beneficiary outside of probate.

4. WHAT IS THE TRANSFER ON DEATH DESIGNATION AFFIDAVIT?

Effective December 28, 2009, you can avoid probate on real estate if you have an affidavit prepared naming the beneficiary of your real estate. The affidavit must contain the following:

* It must be notarized and filed before death of the property owner.
* It must describe the property and its instrument number.
* It must describe the portion of the property being transferred.
* It must state whether or not you are married. If you are, your spouse must sign the affidavit also.
* It must name the beneficiary

5. WHO CAN BE THE BENEFICIARY OF THE REAL ESTATE?

You can name an individual, trust or other legal entity such as a limited liability company or corporation as the beneficiary of your real estate with the transfer on death designation affidavit.

6. HOW MANY BENEFICIARIES CAN YOU HAVE WITH A TRANSFER ON DEATH DESIGNATION AFFIDAVIT?

* You can have multiple beneficiaries
* Each beneficiary ownership does not have to be equal. For example you can provide that child one inherits 3/4th and child two inherits 1/4th of the real estate
* You can have beneficiaries inherit with a survivorship clause. For example, you can provide that child one and child two are the beneficiaries with a joint and survivor interest. That would mean upon death of the property owner, the children would hold the property with a right of survivorship. So upon the death of child one, child two inherits the property outside of probate. You cannot use this if one of the beneficiaries is a legal entity like a trust.
* The beneficiary named in the affidavit can be a trust, corporation, limited liability company or other legal entity.
* Joint and survivor owners of real estate can name a beneficiary of the joint and survivor deed. For example, a husband and wife can own the property in joint and survivor ownership and have a transfer on death designation affidavit naming the children as beneficiaries.

7. DO I HAVE TO APPLY THE TRANSFER ON DEATH DESIGNATION AFFIDAVIT TO THE ENTIRE PROPERTY?

No. You can have a transfer on death designation affidavit apply to all or a portion of the real estate.

8. SHOULD EVERYONE USE A TRANSFER ON DEATH DESIGNATION AFFIDAVIT?

No. A transfer on death designation affidavit is not the solution to all problems. For some people a trust may be the better solution or a joint and survivor deed. For married couples who may be trying to qualify for Medicaid, it may be necessary to go through probate and not use any of the probate avoidance deeds discussed.

9. WHEN WOULD I USE A TRUST TO AVOID PROBATE OF REAL ESTATE?

A trust may have several advantages over a transfer on death designation affidavit.

* If the property is an investment property such as a rental property, a trust would make it easier to manage the property if there are several owners inheriting the property. If property is held by individuals all decisions have to be unanimous. The trustee of property held in a trust can make the decisions without the approval of the beneficiaries.
* The beneficiaries of a trust do not have liability for any claims related to the real estate
* The trust could protect the assets from potential creditor claims or divorce claims of any of the beneficiaries.
* The trust could avoid any additional death taxes on the real estate.
* The trust can hold a benefit for grandchildren if your child dies before you. For example if you have three children and you provide the assets go to your children equally and one of your children dies prior to you, that child's share can be held for minor grandchildren in trust.

10. WHEN WOULD I USE A JOINT AND SURVIVOR DEED TO HOLD REAL ESTATE?

Typically a joint and survivor deed is used for a husband and wife to pass the real estate to the surviving spouse. This may be the appropriate solution for some people. However it may not be the correct solution to address estate tax issues, liability issues, and Medicaid planning.

Also if a joint and survivor deed is used for a parent and a child there could be adverse income tax results and liability issues.

Example: Widow owns a house that she bought for $50,000 which is worth $250,000. widow puts daughter on the deed as a joint and survivor benefit to avoid probate. Daughter is married. (Either before or after the house is put in joint and survivor deed.) Here are the issues:

* Daughter now owns a portion of the house. If Widow wants to sell house she needs signature of daughter and daughter?s spouse.
* If widow had owned the house in her own name and sold the house there would be no income tax. Since she owns the house in joint and survivor ownership, the daughter could owe Federal and Ohio income taxes on the sale of approximately $20,000.
* If daughter has any debt problems, daughter?s ? of house could be subject to creditor claims. The creditor could force the sale of the house.

11. WHERE IS THE LAW ON THE TRANSFER ON DEATH DESIGNATION AFFIDAVIT?

Ohio Revised Code, Title 53, Sections 5302.22; 5302.222; 5302.23; and 5302.24

Copyright * Budish, Solomon, Steiner & Peck, Ltd. This article may be reproduced with proper attribution to the law firm of Budish, Solomon, Steiner & Peck, Ltd.

2009-12-03T16:37:00.001-05:00

IRS Issues Guidance on 2009 Required Minimum Distribution, no need to take it this year. http://ping.fm/D5YM1

2009-11-19T10:58:00.001-05:00

More Health Care Is Not Always Better-Watch out! http://ping.fm/VFHUY

WHAT IS THE BIGGEST COST WHEN YOU DIE?

2009-11-17T10:43:00.000-05:00

What do you think the biggest cost is when you die? Taxes? Probate? Wrong! In many cases the biggest cost is the funeral. That's right, today the average cost runs between $8000 and $12,000! And in some cases the cost can be even more. The biggest cost of the funeral typically is the casket. A price tag of $2000 or more is not unusual. But there are even more costs. Once you add in the transportation of the body to the funeral home, embalming, transporting the body and the family to the cemetery, use of the funeral home facilities for the viewing and the ceremony, printing the memorial booklet, the vault into which the casket goes, and then the funeral home "basic services" fee, the cost can rise to many thousands of dollars. This list doesn’t even include the cemetery plot, grave marker, flowers, and luncheon. Plus, what will the cost be if you want to be buried far from where you reside, or you die while traveling?

What's a good consumer to do? Life insurance can help, but there's more you can do. Most important, read the contract from the funeral home and make sure you understand everything before you sign. Always ask a lot of questions, and shop around. The prices, services and terms vary widely between funeral homes. If you are interested in a particular funeral package, always make sure you get a written price quote. Don't let yourself be pushed into a comprehensive package that includes services you don't need or want. Additionally, watch out for subtle high pressure sales, especially with respect to the casket. The funeral home may push you to a more expensive casket, describing other less expensive options in derogatory terms.

There are also other funeral options to consider. One is cremation. This is an increasingly popular option, which can cost a fraction of a traditional burial. Today more than a third of all funerals are cremations. Another option you may consider is a "green" funeral, often with the burial in an open field with markers made from local rock. A simple burial in a simple wood box without chemicals or a concrete vault will be a lot less expensive. Most people spend more time shopping for the right television set than they do choosing a funeral.

Maybe you should take action today! Not sure where to start? First, check out the options. Talk to several funeral homes to gather the information you need. Then after you have decided upon your personal options of choice, talk to your family and let them know your wishes. You might even want to consider prepaying for your funeral now, instead of leaving it to your family to make all the arrangements under a tight time frame, while they are grieving. You can save a lot of money, and avoid hassles and frustrations during a time of grief, by doing your funeral shopping now.

2009-11-06T18:23:00.001-05:00

Understanding the Differences Between a Will and a Trust - ElderLawAnswers Articles http://ping.fm/858Xv

Don't Let Medicaid Take Your Home!

2009-10-29T19:59:00.000-04:00

Can the state take away your home? I want to tell you a sad but true story that happened just last week. Only the names have been changed to protect people’s privacy.

Robert called my office in a panic. His wife of 50 years had died, after spending the last couple of years in a nursing home. They had spent down their life savings until nothing was left, then his wife had gone on Medicaid.

After his wife’s death, Robert had signed two contracts, one selling his current home, and the other buying a trailer which was to be his new residence. The sale price for his current home was about $35,000, and the proceeds were needed to pay for his new property.

Both deals were set to close the next week. So why was Robert in a panic? He had just been told that he wasn’t going to be able to get the $35,000 from the sale of his home. The money would have to be placed in escrow, because the State had recorded an Affidavit against the property saying that Robert owed the state more than $100,000 for his wife’s Medicaid. And since he wouldn’t get the money from the sale of his home, he couldn’t buy the new property.

So here’s what Robert was facing: in several days his home would be sold, and he’d have to move. But he couldn’t get the money to pay for his new trailer, so his purchase would fall through. He’d have no money, and no place to live. All because his wife went on Medicaid.

There was only one problem: The state’s action was illegal. The State of Ohio could not legally take Robert’s home, or the home’s sale proceeds, while Robert was alive. Ohio has an estate recovery law that allows the state to take a person’s home and sell it in order to reimburse the State for previous Medicaid payments. But under both state and federal law, that cannot be done until you’ve died. And Robert’s case demonstrates the reason why: we don’t want people thrown out onto the street just because a spouse became ill and needed nursing home care.

Now, Robert’s stay has a happy ending. Our office called the Attorney General’s office and explained that the state was acting illegally. And the problem was immediately corrected. Robert got his money and bought his new trailer.

But what about all the “Robert’s” out there whose homes are being wrongfully threatened? And who don’t know to call a lawyer?

Don’t let this happen to you. Don’t let the state illegally take your house!

Medicaid Coverage For Expensive Nursing Homes At Risk in OHIO--The Rest of the US Better Watch Out!

2009-10-12T18:07:00.000-04:00

If you or a loved one must enter a nursing home, be ready for some "sticker shock." The monthly cost for nursing home care can easily wipe out your life savings at a rate of $6000 to $9000 per month. The one governmental program available to cover nursing home costs is Medicaid. It is a federal health care safety-net program, administered by the states, to provide coverage for the middle class for long-term care costs. As a welfare program, it is hard to protect any of your life savings and receive Medicaid benefits.

Bank accounts, stocks, bonds, IRAs and even the cash value of life insurance policies are countable assets. A single person may keep only $1500 of assets in order to qualify for Medicaid. A married couple can keep a home as long as one spouse is living in it, and one-half of the countable assets, up to a maximum of just under $110,000 ( in 2009, this amount is indexed annually). The excess assets have to be "spent down." In the past, it was relatively simple to keep and protect these allowable assets from Medicaid. However, the state of Ohio has Medicaid regulations that make it terribly hard to obtain benefits in the first place and then pass the allowable assets on to children or other heirs.

For example, Medicaid lets a married couple keep a home as long as one spouse is living there. However, if at the time the first spouse enters the nursing home, the couple has their home in a revocable living trust (very common for probate avoidance and perfectly legal), the house is NOT exempt and becomes subject to spend-down. Additionally, assuming Medicaid is available for the nursing home spouse, if the healthy spouse dies first and the house is left back to the ill spouse, it will be lost to nursing home costs. Under previous Medicaid law, in order to protect the house, we disinherited the ill spouse and left the house to the children, without a problem. Now, Medicaid takes the position that the healthy spouse could have and should have left the home to the ill spouse. Therefore, if we use the same planning, when the home passes to children, it is as though the ill spouse GAVE AWAY the home and he or she is disqualified from getting Medicaid benefits for a period of time because a gift was made at death. In fact, Medicaid now even forces the house to remain in the healthy spouse's sole name as long as the ill spouse is receiving Medicaid. Any attempt to change the title during the lifetime of the ill spouse will create a gift at the time of the title change and disqualify the ill spouse from Medicaid immediately!

Another punitive regulation is the procedure when a mistake is made in the application process. Mistakes are common because, typically, the person in the nursing home cannot apply on his own. A family member is handling the application. In the past, mistakes were handled simply and easily. The caseworker allowed the spend-down of any additional funds and Medicaid continued. Now, when a mistake is made, the mistake is presumed intentional, Medicaid fraud has occurred and the person can be turned over to the prosecutor's office for prosecution.

Medicaid planning is very complex. Note that this article includes OHIO rules, and every state is different. In order to protect yourself and your assets, you need to consult an attorney who is well versed in Elder Law issues, including Medicaid eligibility. If you need help in Ohio, or for more information, please see our website at http://www.budishandsolomon.com/.

What Medicare pays for Alzheimer's

2009-10-08T19:27:00.001-04:00

I saw this article and thought it was important information for people to know. Don't get surprised by what Medicare WON'T pay if you have a loved one with Alzheimer's in a medical facility.

http://www.gilbertguide.com/articles/avoiding-surprises-services-covered/

2009-10-07T09:43:00.001-04:00

Senate Finance Committee completes markup of America's Healthy Future Act bill. Includes Elder Justice Act, http://ping.fm/itxkx

Make sure you protect your special needs child!

2009-10-04T20:01:00.002-04:00

You're taking care of your disabled child and hopefully, you?re doing okay. But what will happen when you're gone? If you plan ahead, you should be able to make sure your child is protected. Is it enough to leave an inheritance for your child? No, not if you want to protect your child after you?re gone. There are two big problems with leaving money or property to an adult child with disabilities.

First, can the child manage the inheritance? If the disability is mental or emotional, that could be a major problem. If the disability is physical, managing money could still be a problem, particularly if the child is not mobile!

Second, is the inheritance enough to provide for all of the child's needs for life? If not, leaving money outright to a disabled child may be a bad idea. Here's why: if your disabled child has money, he or she cannot obtain any public benefits, such as Medicaid, SSI or food stamps. The child will have to spend the inheritance until it's gone. Once the inheritance has been used up, then the child may receive those public benefits. But public benefits don't cover a lot of comforts of life. They are very basic. For example, they may pay for a nursing home, but not for other housing options. They may pay for basic food needs, but not for transportation, telephone, or cable.

How can we protect a disabled child? For many people, the answer is a special needs trust. With this trust, you can leave an inheritance for a child and place someone you trust in charge of managing the money. Perhaps the money should be managed by another one of your children, or by another trusted family member, or even a trusted friend. If there?s no one, you could name a professional manager, such as a bank trustee.

Any other benefits to a special needs trust? Yes. A Special Needs Trust can be used to preserve a child's eligibility for public benefits. So even though you've left an inheritance, the child can still get Medicaid, SSI and food stamps.

And since public benefits only provide very basic support, the trust funds can be used to supplement the public benefits, providing more of the comforts of life. It's a wonderful way to protect a disabled child.

Is a special needs trust just the same as a regular living trust? No. A regular trust will not protect a disabled child adequately. A Special Needs Trust is a very specialized trust that must satisfy a number of legal requirements for it to work. Where do we get a special needs trust? A Special Needs Trust is only part of the planning that may be needed to protect a child with a disability. To get help, you should seek the services of a lawyer experienced in dealing with the needs of people with special needs.

Make sure you have prepared for the day you'll no longer be able to care for your disabled child.

It won't Happen to ME!!!

2009-09-14T17:31:00.001-04:00

When dealing with leaving assets at death, I have clients all the time who say, my children are perfect, they won't fight or ever have any financial problems! Famous last words. Consider this:

When Sharon was planning for how her assets would pass to her four children, she envisioned an easy transition. She had read all the articles on avoiding probate, setting up trusts, and organizing her affairs. She had even spoken to her children about her wishes (a very difficult thing to do). All of her children had wonderful relationships with each other and the assets were to be divided equally. After Sharon died, the transition was easy; each of her children received an equal share of assets and everyone was happy. Unfortunately, shortly thereafter the real trouble began.

Her number 1 son was a doctor. He had a good practice and he thought his patients were happy. One was not, and sued him above his malpractice insurance levels, and WON! Suddenly all of this son's assets, including Sharon's legacy, were gone.

Daughter number 2 was married with 3 children of her own. She thought she would follow her mother's estate plan when she died, since things had progressed so smoothly. Suddenly her husband filed for divorce, and demanded half of all assets, including Sharon's. After a terrible legal battle (which cost thousands in legal fees), most of Sharon's money was gone.

Daughter number 3 was ill most of her life, but had a terrific husband who cared for her, along with a faithful nurse and two children. When she died, she left everything to her loving husband, who promptly married the nurse. He added her name to all the assets. When he later died, everything was left to the nurse. Daughter number 3's children got nothing.

Son number 4 was single, and had never had much money. After receiving Sharon's inheritance, he felt rich and proceeded to buy all the thing in life he had never been able to afford. Before too long, all the money was spent and he was no better off.

What happened? This was not what Sharon had planned so carefully for. She missed one critical step: protecting her money even after she was gone. But how? With a BLOODLINE TRUST! This starts out like a simple Living Trust while Sharon is alive. She has full access to and control of the funds. Upon her death, the assets avoid probate, but instead of distributing outright to her four children, the assets are divided into four separate trust shares to be held for each of her children for life. Each child can have access to his or her share for everyday living expenses, but does not receive the lump sum in one chunk. The share held in trust is protected from the lawsuits, divorce, death or crazy spending of the children. Yet the money is there if needed. Plus, when each child dies, his or her remaining share is left to his or her children, Sharon's grandchildren, whom she adored and wanted to benefit if she could.

This simple, but often overlooked, planning tool would have been the answer to Sharon's prayers, and could be perfect for you too. See an attorney who focuses on Estate Planning and Probate Avoidance to establish a Bloodline Trust.

Today is the first day

2009-09-12T20:23:00.001-04:00

Today is the first day of the rest of my life.

Coldwater Creek

2009-09-12T18:02:00.000-04:00

Coldwater Creek

Today is my first post

2009-01-03T14:45:00.003-05:00

Today is Saturday, and I am working on my laptop computer. I have been reading more about blogging and on-line marketing, and so now I take the leap into that.

I am an Elder Law attorney and I see so much fear in the eyes of my clients. I want to help everyone that I meet, and sometimes it's not possible. When someone comes in to meet with me, and they are able to sleep again at night after our planning meeting, it is really a good day. I just wish everyone would make an appointment.

I help people at a very bad time, when a spouse or loved one is ill, dying, going into a nursing home or just getting old. That is the majority of who I see. I help with estate planning, Medicaid planning, disability planning, probate, trust administration for lots of people.

I would like my blog to reflect my frustrations with "the system" and how people can be helped. See our website too: http://budishandsolomon.com