Elder Law

Protecting Assets With Caregiver Agreements

Published on: November 15, 2020 | by Ettinger Law Firm

Family members as caregivers overwhelmingly provide for elderly and disabled loved ones at home. Although a labor of love, taking care of ailing loved ones also has a market value, meaning that caretakers may be paid as a way to protect assets.

Through the use of a Caregiver Agreement, also known as a Personal Services Contract, the disabled or elderly person may transfer money to family members as compensation rather than as a gift. Gifts to family members made in the last five years before applying for Medicaid to pay for nursing home costs disqualify the applicant from receiving Medicaid for a certain period of time, known as a “penalty period.”

For example, mom depends on daughter Janice for her care. If mom gifts $100,000 to Janice, then goes into a nursing home in the next five years and applies for Medicaid, the gift to Janice will result in about a ten month penalty period. Janice will have to give the $100,000 back to mom to pay nursing home costs during the penalty period, or mom will have to use other resources to pay.

Why Claiming Social Security Benefits at 62 May be Good for You

Published on: April 24, 2020 | by Ettinger Law Firm

The conventional wisdom is to wait and not claim Social Security benefits until you are over 66 (the full retirement age for individuals born between 1943 and 1954). Full retirement age is calculated by year of birth. To see what your full retirement age is click here, or review the website maintained by the Social Security Administration (www.ssa.gov). The reason choosing when to begin claiming Social Security benefits is a big decision that will impact the size of your monthly benefit amount or checks for the rest of your life. For example, if you have a full retirement age of 67 and wait until age 70 to begin claiming Social Security benefits, you’ll receive your full benefit amount plus an extra 24% each month for the rest of your life.

Delaying benefits however isn’t right for everyone, and it may make sense for you to claim your benefits as early as possible, or age 62, (the earliest retirement age for individuals born between 1943 and 1954). Again, to determine when you can claim your benefits, click here. Three reasons why claiming your retirement benefits through the Social Security program may be right for you are as follows:

Your retirement years are limited.

How much can you receive in divorce benefits?

Published on: April 15, 2020 | by Ettinger Law Firm

If you’re eligible for divorce benefits from the Social Security Administration (SSA), you can collect up to 50% of the amount your former spouse is eligible to receive by claiming your benefits at his or her full retirement age (FRA).

Your FRA is either 66, 66 plus a few months, or 67, depending on the year you were born. The earliest you can claim Social Security benefits is 62. If you claim benefits before your FRA, your Social Security benefits will be permanently reduced by as much as 30%. You can only receive your full Social Security benefit amount if you claim benefits at your FRA.

You cannot double dip

Are You Still Concerned About Your Child’s Spouse?

Published on: April 12, 2020 | by Ettinger Law Firm

Estate planning around your child’s partner is concerning for many parents. Shielding your assets from your child’s spouse in the event of divorce is possible and can be a part of your estate plan. The reasons for wanting to shield your assets from your child’s spouse are varied and packed with emotions and feelings. Some parents wish to pass their property down within their own bloodline. Other parents themselves are also divorced and worry about how their child’s inheritance may wind-up down the road if there is a divorce or a new family in the picture. And some parents, even after years of their child being married, still do not like their spouse.

It is upsetting to a child when his or her parents disapprove of their spouse. Some families are discreet about their true feeling, while others make it well-known. No matter where you fall in the spectrum of possibilities, there are ways to prepare your estate plan that may take away some of your worries that your child’s inheritance will be squandered away when you die because of his or her relationships while avoiding the emotional time-bomb of revealing your true feelings about your child’s spouse to your child.

The most effective way to shield your assets from your child’s spouse is to have your child and his or her spouse enter a prenuptial agreement before they get married. While this may be the best solution, it is also the most emotionally charged and wrought with difficulties. If you push to hard, legally, it may be a ground to invalidate the prenuptial agreement, because such agreements need to be voluntary to be enforceable. Trusts are an emotion-free method to communicate and exercise your feelings about your child’s choices without articulately them to all who would here.

Estate Planning in Turbulent Times – Additional Things to Consider

Published on: April 6, 2020 | by Ettinger Law Firm

We continue to wish you and your family safety and good health and hope that worldwide events unleashed by the pandemic we are experiencing does not keep you separated from your loved ones for too long. Wash your hands regularly and avoid touching your face. Limit your contact with other people and maintain cleanliness and good hygiene to slow down the spread of COVID-19.

We continue to discuss items you should review in your current estate plan to take into consideration the volatility of the financial markets and to compensate for financial losses your retirement plans may have experienced because of the losses. Ask your estate planning attorneys to help you consider the following changes to your estate plan.

Refinance intra-family loans to take advantage of lower interest rates.

Pay Up: 13 States that Tax Social Security Benefits

Published on: March 16, 2020 | by Ettinger Law Firm

For over 80 years, Social Security has made guaranteed monthly payouts to eligible retired workers. Today, over 64 million people receive a monthly benefit from the Social Security program. The average retired worker benefit is $1,505.50 a month, as of January 2020. Generally Social Security income for the ordinary retiree is not taxed. There are states however, that do tax Social Security income.

The federal government can tax your Social Security benefits

The taxation of Social Security benefits began in earnest as part of the Social Security Amendments of 1983. Beginning in 1984, the Internal Revenue Service (IRS) is allowed to apply federal ordinary income tax rates on up to one-half of an individual’s or couple’s Social Security benefit, depending on their income. If an individual’s or couple’s modified adjusted gross income (MAGI) plus one-half of benefits exceeds $25,000 or $32,000, respectively, they would be subject to this tax.

Back to Basics: Estate Planning 101, Part IV

Published on: March 12, 2020 | by Ettinger Law Firm

Every estate plan should include a living trust. A living trust is different from a trust and should be part of your estate plan along with a last will and testament and power of attorney (financial and medical) documents.

Why a living trust is an important estate plan document

A living trust is a written legal document that partially substitutes for a will. With a living trust, your assets (your home, bank accounts and stocks, for example) are put into the trust, administered for your benefit during your lifetime, and then transferred to your beneficiaries when you die. Living trusts, have great value as part of estate planning, but not necessarily to avoid probate. A living trust, if properly prepared and administered, can be a very effective tool to manage assets in the event of illness, disability or the effects of aging. In light of the aging population, the use of living trusts to minimize the risk of elder financial abuse and address similar issues, should be an important consideration in an estate plan.

Back to Basics: Estate Planning 101, Part III

Published on: March 8, 2020 | by Ettinger Law Firm

A power of attorney, including a heath care power of attorney, are crucial estate planning documents. This is especially important if you have Alzheimer’s disease, dementia, or are suffering from another chronic and debilitating illness. Individuals who are widowed or alone should carefully consider who they can trust to manage their financial and medical affairs when they lose the ability to make such decisions themselves.

Power of Attorney: A power of attorney is a legal document you can use to appoint someone to make decisions on your behalf. The person you designate is called an “attorney-in-fact.” The appointment can be effective immediately or can become effective only if you are unable to make decisions on your own.

o New York State has a short-form and a long-form Power of Attorney form.

Back to Basics: Estate Planning 101, Part II

Published on: March 6, 2020 | by Ettinger Law Firm

A trust is an important estate plan document. Other estate planning documents include a last will and testament and intestate succession.

Every state has laws that determine who your heirs are and what proportion of the estate the heir is entitled to receive. Heir refers to blood relatives and are usually grouped according to closeness of relationship: Children and spouse; siblings and parents; aunts, uncles, and cousins. Where there is no will or trust, the estate is deemed “intestate” and must be settled according to state probate law. Individuals who inherit property under a will or trust are referred to as beneficiaries. Persons can be named as beneficiaries on bank accounts, life insurance policies, financial portfolios, retirement accounts, and certain types of titled property such as real estate – they need not be heirs. Remember heirs can be beneficiaries, but beneficiaries are not always heirs.

To complete an estate plan, you should consider adding trust documents.

Back to Basics: Estate Planning 101, Part I

Published on: March 2, 2020 | by Ettinger Law Firm

Creating a thoughtful estate plan is one of the greatest gifts anyone can leave their loved ones. It is important to update your will when major changes occur. These might include marriage, divorce, opening or closing a business, buying or selling real estate, or birth or death of an heir.

Estate planning is a process that helps ensure that your desires for distribution of your property and assets at death are carried out. During life, to complete an estate plan, you should consider the following:

Will: A will is the primary document that should be prepared while living, to be effective at death. A will is a written document expressing how you would like your estate to be distributed after death. Usually a will must be executed in the presence of two disinterested witness and be notarized. You must also have testamentary capacity (over the age of 18, of sound mind, and competent).