Posts Tagged ‘veterans’

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Responsibility for a Deceased Relative’s Debts

Friday, April 1st, 2011 by Moore McLaughlin

The loss of a loved one is tough to begin with, but if the loved one left debts behind, it can be even tougher. Family members generally should not have to pay for a decedent’s debts, but it is important to know your rights because collection agencies may target the decedent’s relatives.

Usually the loved one’s estate is responsible for paying any debts. If the estate does not have enough money, the debts will go unpaid. The debt collectors may not collect payment from relatives (unless they were co-signers or guarantors). However, if you are the spouse of the decedent, you may have responsibility for any debts that were jointly held. Depending on state law, some assets — such as a house or car — may be exempt from debt collection. You should talk to an attorney to determine your responsibility, if any.

If a debt collector contacts you, give the collector the contact information for the personal representative (also called the “executor”) who is handling the estate. It is the personal representative’s responsibility to make sure all bills are paid. Whatever you do, do not give any personal information to debt collectors. Scam artists sometimes pose as debt collectors to prey on relatives.

If a debt collector won’t stop contacting you, send a certified letter to the collector saying you do not want to be contacted again. Once the collector receives the letter, the collector can contact you only to tell you that there will be no further contact or to inform you of a lawsuit. Report any problems with debt collectors to your state’s attorney general or to the Federal Trade Commission.

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Posted in Asset Protection Planning, Elderlaw/Law For Life, Estate Planning, Financial workout, Tax planning

A Trip to the Hospital May Put Assisted Living Residents on Medicaid at Risk of Eviction

Wednesday, February 2nd, 2011 by Moore McLaughlin

Elderlaw Attorney Jill E. Sugarman tells us that assisted living facility residents covered by Medicaid are at risk of being evicted if they leave the facility, even for a temporary hospitalization.  The National Senior Citizen’s Law Center (NSCLC) warns of this problems in a recently released White Paper. Ironically, Medicaid officials in most states have the power to prevent these evictions but in most cases are not exercising it.

Most state Medicaid programs pay for services not just in nursing homes but in assisted living facilities, which are meant to provide a home-like alternative to nursing homes. But there is a crucial difference between nursing homes and assisted living facilities. The Nursing Home Reform Law authorizes Medicaid to pay a nursing home to hold a room for a Medicaid recipient who is temporarily absent due to hospitalization and entitles the resident to return to the first-available room.

In contrast, Medicaid does not make similar payments on behalf of residents of assisted living facilities and the facilities are not required to give admission priority to returning residents. This difference in treatment, the NSCLC asserts in its report, “Medicaid Payment for Assisted Living: Residents Have a Right to Return After Hospitalization,” diminishes the value of assisted living facilities as a community-based alternative to nursing home care. If assisted living facilities truly seek to offer “home or community-based” services, says the advocacy group, residents should have the peace of mind of knowing that they won’t be evicted if they are absent for a few days or weeks.

The NSCLC points out that in most cases states could remedy the situation. Most states pay for assisted living care though a Medicaid waiver program. In 2000, the federal Centers for Medicare and Medicaid Services (CMS) advised states that it would authorize the issuance of “retainer payments” to Medicaid waiver home and community based service providers during a Medicaid recipient’s temporary absence, such as for hospitalization. The guidance described the retainer payments as being comparable to room-hold payments for nursing home residents. However, it appears that most of the states either do not understand the federal guidance or have not implemented it. Exceptions include Georgia, Illinois, Montana and Washington, all of which make retainer payments to assisted living facilities on behalf of residents who are temporarily absent.

The NSCLC makes a number of recommendations:

  • CMS should clarify that Medicaid-funded retainer payments are available for temporary absences from an assisted living facility;
  • State governments should authorize retainer payments up to the federally allowed maximum;
  • Federal Medicaid law should be changed to entitle residents of assisted living facilities to room holds, room-hold payments and readmission to the next available room after temporary absences;
  • Room holds should apply regardless of the reason for an absence.

To view NSCLC’s White Paper and other materials on the issue, including a News Release and a Policy Brief, click here.

For more information regarding Medicaid planning, contact Jill E. Sugarman, Esq. at jsugarman@mclaughlinquinn.com or by phone at 401-421-5115 ext. 215.

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Posted in Asset Protection Planning, Elderlaw/Law For Life, Estate Planning

Protecting Your House After You Move Into a Nursing Home

Sunday, October 24th, 2010 by Moore McLaughlin

While you generally do not have to sell your home in order to qualify for Medicaid coverage of nursing home care, it is possible the state can file a claim against your house after you die. If you get help from Medicaid to pay for the nursing home, the state must attempt to recoup from your estate whatever benefits it paid for your care. This is called “estate recovery,” and given the rules for Medicaid eligibility, the only property of substantial value that a Medicaid recipient is likely to own at death is his or her home. If possible, you should consult with an attorney before entering a nursing home, or as soon as possible afterwards, in order to discuss ways to protect your home.

In those states that have implemented the Deficit Reduction Act of 2005, the home is not counted as an asset for Medicaid eligibility purposes if the equity is less than $500,000 ($750,000 in some states). In all states, you may keep your house with no equity limit if your spouse or another dependent relative lives there.

Transferring a Home
In most states, transferring your house to your children (or someone else) may lead to a Medicaid penalty period, which would make you ineligible for Medicaid for a period of time. There are circumstances in which it is legal to transfer a house, however, so consult an attorney before making any transfers. You may freely transfer your home to the following individuals without incurring a transfer penalty:

  • Your spouse
  • A child who is under age 21 or who is blind or disabled
  • Into a trust for the sole benefit of a disabled individual under age 65 (even if the trust is for the benefit of the Medicaid applicant, under certain circumstances)
  • A sibling who has lived in the home during the year preceding the applicant’s institutionalization and who already holds an equity interest in the home
  • A “caretaker child,” who is defined as a child of the applicant who lived in the house for at least two years prior to the applicant’s institutionalization and who during that period provided care that allowed the applicant to avoid a nursing home stay.

While you can sell your house for fair market value, it may make you ineligible for Medicaid and you may have to apply the proceeds of the sale to your nursing home bills.

Lien on Home
Except in certain circumstances, Medicaid may put a lien on your house for the amount of money spent on your care. If the property is sold while you are still living, you would have to satisfy the lien by paying back the state. The exceptions to this rule are cases where a spouse, a disabled or blind child, a child under age 21, or a sibling with an equity interest in the house is living there.

Estate Recovery
If your spouse, a disabled or blind child, a child under age 21, or a sibling with an equity interest in the house, lives in the house, the state cannot file a claim against the house for reimbursement of Medicaid nursing home expenses. However, once your spouse or dependent relative dies or moves out, the state can try to collect.

But there are some circumstances under which the value of a house can be protected from Medicaid recovery. The state cannot recover if you and your spouse owned the home as tenants by the entireties or if the house is in your spouse’s name and you have relinquished your interest. If the house is in an irrevocable trust, the state cannot recover from it.

In addition, some children or relatives may be able to protect a nursing home resident’s house if they qualify for an undue hardship waiver. For example, if your daughter took care of you before you entered the nursing home and has no other permanent residence, she may be able to avoid a claim against your house after you die. Consult with an attorney to find out if the undue hardship waiver may be applicable.

For more information on Medicaid planning, please contact Elderlaw Attorney Jill E. Sugarman at 401-421-5115 or by e-mail at JSugarman@McLaughlinQuinn.com.

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Posted in Asset Protection Planning, Elderlaw/Law For Life, Estate Planning

10 Reasons to Create an Estate Plan Now

Sunday, October 24th, 2010 by Moore McLaughlin

Many people think that estate plans are for someone else, not them. They may rationalize that they are too young or don’t have enough money to reap the tax benefits of a plan. But as the following list makes clear, estate planning is for everyone, regardless of age or net worth.

1. Loss of capacity. What if you become incompetent and unable to manage your own affairs? Without a plan the courts will select the person to manage your affairs. With a plan, you pick that person (through a power of attorney).

2. Minor children. Who will raise your children if you die? Without a plan, a court will make that decision. With a plan, you are able to nominate the guardian of your choice.

3. Dying without a will. Who will inherit your assets? Without a plan, your assets pass to your heirs according to your state’s laws of intestacy (dying without a will). Your family members (and perhaps not the ones you would choose) will receive your assets without benefit of your direction or of trust protection. With a plan, you decide who gets your assets, and when and how they receive them.

4. Blended families. What if your family is the result of multiple marriages? Without a plan, children from different marriages may not be treated as you would wish. With a plan, you determine what goes to your current spouse and to the children from a prior marriage or marriages.

5. Children with special needs. Without a plan, a child with special needs risks being disqualified from receiving Medicaid or SSI benefits, and may have to use his or her inheritance to pay for care. With a plan, you can set up a Supplemental Needs Trust that will allow the child to remain eligible for government benefits while using the trust assets to pay for non-covered expenses.

6. Keeping assets in the family. Would you prefer that your assets stay in your own family? Without a plan, your child’s spouse may wind up with your money if your child passes away prematurely. If your child divorces his or her current spouse, half of your assets could go to the spouse. With a plan, you can set up a trust that ensures that your assets will stay in your family and, for example, pass to your grandchildren.

7. Financial security. Will your spouse and children be able to survive financially? Without a plan and the income replacement provided by life insurance, your family may be unable to maintain its current living standard. With a plan, life insurance can mean that your family will enjoy financial security.

8. Retirement accounts. Do you have an IRA or similar retirement account? Without a plan, your designated beneficiary for the retirement account funds may not reflect your current wishes and may result in burdensome tax consequences for your heirs (although the rules regarding the designation of a beneficiary have been eased considerably). With a plan, you can choose the optimal beneficiary.

9. Business ownership. Do you own a business? Without a plan, you don’t name a successor, thus risking that your family could lose control of the business. With a plan, you choose who will own and control the business after you are gone.

10. Avoiding probate. Without a plan, your estate may be subject to delays and excess fees (depending on the state), and your assets will be a matter of public record. With a plan, you can structure things so that probate can be avoided entirely.

For more information on getting started with your estate plan, contact Estate Planning Attorney Jill E. Sugarman at 401-421-5115 or by e-mail at JSugarman@McLaughlinQuinn.com.

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Posted in Asset Protection Planning, Elderlaw/Law For Life, Estate Planning, Tax planning

Spouses Could Be In Jeopardy under 2010 Repeal of Estate Tax

Sunday, January 31st, 2010 by Moore McLaughlin

As McLaughlin & Quinn, LLC has posted previously, the estate tax expired on January 1, 2010. It remains to be seen whether Congress will reinstate it before it returns in 2011, but the fact that there is currently no estate tax can have unintended consequences for spouses. Standard language found in many estate plans could leave spouses with nothing. It is important to check with an elder law or estate planning attorney such as McLaughlin & Quinn’s Jill E. Sugarman, Esq. to make sure your estate plan does what you want it to do.Widow

In previous years, estates could pass a certain amount of assets tax free (up to $3.5 million in 2009). In addition, spouses can receive an unlimited amount tax free. To take advantage of these rules, estate plans often contain a “bypass trust” (or “credit shelter trust”) and a will with language in it that is designed to allow estates to pass without any estate tax. For example, the will may state: “I leave to my trustees the maximum amount that can pass free of estate tax and leave the residual to my spouse.” Because there is currently no estate tax, individuals who die in 2010 with this language in their estate plan would wind up leaving nothing to their spouses.

While most states allow spouses to claim a portion of the estate (usually one-third), even if they don’t receive anything under a will, this can be a time-consuming and expensive process. To ensure your spouse is covered, you should talk to an attorney.

To learn more about this, contact Jill E. Sugarman, Esq. by e-mail at jsugarman@mclaughlinquinn.com or by phone at 401-421-5115.

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Posted in Asset Protection Planning, Current Events, Elderlaw/Law For Life, Estate Planning, Tax Current Events and News, Tax planning

The Need for Medicaid Planning

Saturday, December 12th, 2009 by Moore McLaughlin

MedicaidJill E. Sugarman, Esq., of McLaughlin & Quinn, LLC knows that one of the greatest fears of older Americans is that they may end up in a nursing home. This not only means a great loss of personal autonomy, but also a tremendous financial price. Depending on location and level of care, nursing homes cost between $35,000 and $150,000 a year.

Most people end up paying for nursing home care out of their savings until they run out. Then they can qualify for Medicaid to pick up the cost. The advantages of paying privately are that you are more likely to gain entrance to a better quality facility and doing so eliminates or postpones dealing with your state’s welfare bureaucracy–an often demeaning and time-consuming process. The disadvantage is that it’s expensive.

Careful planning, whether in advance or in response to an unanticipated need for care, can help protect your estate, whether for your spouse or for your children. This can be done by purchasing long-term care insurance or by making sure you receive the benefits to which you are entitled under the Medicare and Medicaid programs. Veterans may also seek benefits from the Veterans Administration.

For more information about Medicaid planning for you and your loved ones, contact Jill E. Sugarman, Esq. at 401-421-5115 or by e-mail at jsugarman@mclaughlinquinn.com.

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Posted in Asset Protection Planning, Elderlaw/Law For Life, Estate Planning

End-of-Year Tax Planning Considerations

Sunday, November 29th, 2009 by Moore McLaughlin

As the New Year approaches, taxpayers around the nation are thinking about making gifts or other financial moves before January 1 that will benefit them come April 15, 2010. Jill E. Sugarman, Esq. and I are providing some year-end considerations of particular interest to seniors.

Year-End Tax Planning for Seniors

Year-End Tax Planning for Seniors

A Reprieve on RMDs

Last year, as the stock market plunged and the economy teetered on the brink, Congress suspended the penalty for seniors who fail to take the required minimum distribution (RMD) from their IRA and employer retirement accounts in 2009.

There is normally a penalty for failure to withdraw once the account owner reaches retirement age — after age 70 1/2. Taxpayers generally must begin taking annual distributions from their retirement accounts by the April 1 occurring after they reach age 70 1/2 or pay a whopping 50 percent excise tax on the amount that should have been distributed but was not. To prevent seniors from being forced to sell stocks in a down market, Congress suspended the required minimum distribution rule for 2009.

If you turned age 70 1/2 before 2009, you would normally be required to take your 2009 distribution by December 31, 2009. If you turned or will turn age 70 1/2 in 2009, you would normally be required to take your required distribution no later than April 1, 2010. In either case, you will not need to take this distribution. The new law also waives 2009 distributions for beneficiaries of inherited IRAs and employer retirement accounts. However, taxpayers still must take their 2010 distributions no later than December 31, 2010.

Gift Threshold Now $13,000

The amount that may be gifted each year to any one person without the need to file a gift tax return rose from $12,000 to $13,000 on January 1, 2009. The increase to $13,000 means that more can be given away for estate tax planning purposes. For example, a married couple with four children will be able to give away up to $104,000 in 2009 with no gift tax implications.

Charitable Donations From an IRA Not Taxable

As part of the large financial rescue package, Congress retroactively extended the IRA charitable rollover provision from January 1, 2008, through December 31, 2009. This reinstates the rollover exemption that was part of the Pension Protection Act of 2006.

Previously, those wishing to make charitable donations using money in their IRA accounts were required to withdraw funds from their IRA and pay income tax on the withdrawal before they could take a charitable donation deduction on their annual tax returns. But under the new law, so long as the donation is transferred directly from a traditional or Roth IRA or rollover IRA account to an eligible public charity, the donor doesn’t have to pay any income tax on the withdrawal at all. As far as the federal government is concerned, money donated to the charity simply is not income. (But note that the transfer is no longer eligible for the charitable tax deduction, either.)  For details and restrictions, consult your CPA or financial advisor.

Rollover Retirement Distributions

Those 70 1/2 or older who took a distribution from a retirement plan or IRA earlier in the year may be able to avoid tax on the payout by rolling it over into an eligible retirement plan (including an IRA) before December 1, 2009.

Retirement Contributions

A great way to reduce taxable income is to contribute funds to an IRA or to your 401(k) through work. In addition, the income on assets in the IRA or qualified plan are deferred until the withdrawal is made. The contribution limits for traditional and Roth IRAs remain the same for 2009 as in 2008: $5,000 for a single person and $10,000 for a couple, or $6,000 for a single person if over 50 and $12,000 if both spouses are over 50 and married. If you are self-employed, the contribution limite for a SEP-IRA or a simple IRA is $49,000 per year. Keep in mind that there are limitations on the contributions that may be made based on income and other specific data.

Take Advantage of Losses

Even though the market has posted gains since the dark days of last March, many investors still have long-term capital losses on investments held longer than one year. You can deduct up to $3,000 of these losses a year against ordinary income, with the excess carried forward for use in future years.

If you have questions about how to take advantage of tax-saving opportunities before year’s end, be sure to consult one of the attorneys at McLaughlin &Quinn, LLC or your CPA or financial advisor.

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Posted in Current Events, Elderlaw/Law For Life, Estate Planning, Tax Current Events and News, Tax planning

Thanks to all our Veterans

Wednesday, November 11th, 2009 by Moore McLaughlin

Veterans DayThe attorneys and staff at McLaughlin & Quinn, LLC want to thank all of the veterans who have given our country the freedoms and liberties we enjoy today.  We appreciate their selflessness and sacrifices.  Our country continues to be the best because of them.

Click here to learn more about the history of Veterans Day.

Thanks to all our Veterans.

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Posted in Current Events, McLaughlin & Quinn News

Support Services for Family Caregivers

Saturday, October 10th, 2009 by Moore McLaughlin

CaregiverCaring for a family member is hard work, and without support, caregivers can easily get burnt out or overwhelmed. However, there is help available for caregivers if they know where to look. The National Family Caregiver Support Program is a federal initiative that provides money to states to fund programs that support family caregivers. The goal is to help caregivers care for seniors at home for as long as possible.

The National Family Caregivers Support Program supports family caregivers of adults aged 60 or older or anyone with Alzheimer’s disease. It also funds services to grandparents and relative caregivers, age 55 or older, of children 18 years of age or under or who care for a relative with a disability age 19 to 59.

Under the program, states must provide the following five types of services:

  • Information about available services
  • Assistance in accessing services
  • Counseling, support groups, and training
  • Respite care for the caregiver, which could be through companions, home health aides, adult day care, or in-facility care
  • Supplemental services, such as medical supplies, home safety aides, legal assistance, and financial consultation

The exact services vary from state to state, but caregivers can receive anything from training seminars to case management to home-delivered meals. The services provided are supposed to make daily tasks and routines a little easier.

Click here for more information about these services in Rhode Island.

Click here for more information about these services in Massachusetts.

Or, contact Law for Life attorney Jill E. Sugarman by e-mail at jsugarman@mclaughlinquinn.com or by phone at 401-421-5115, for more information.

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Posted in Asset Protection Planning, Elderlaw/Law For Life, Estate Planning

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