New York Estate Planning & Elder Law Blog

NURSING HOME EVICTIONS

Published on: March 17, 2016 | by Ettinger Law Firm

LEADING COMPLAINT ABOUT NURSING HOME IS EVICTIONS

On February 25, 2016 National Public Radio (NPR) ran a story about what is looking to become like a national epidemic: nursing home evictions. According to statistics between 8,000 and 9,000 nursing home residents complain each year about nursing home evictions. The problem with this statistic is that it only measures the complaints, not the actual evictions. As if not being able to measure the full extent of the actual problem is not enough, there is a larger, more grievous issue wrapped up in the issue of nursing home evictions. According to the ombudsman to the Federal Department of Health and Human Services, Administration on Aging, it is the number one complaint regarding nursing facilities. In many cases the nursing home wrongfully evicted the resident(s) but will not honor rulings that find that the nursing home wrongfully evicted the resident. The entity that decides if a facility wrongfully evicts a resident is not the same entity to enforce its own decision. Without a sister state agency to enforce its decision (much like one state honoring a sister state’s money judgment on full faith and credit), such legal endeavors by residents are simply an exercise in futility. The rulings are not worth the paper they are printed on. It is a prime example of a bureaucracy run amok; without teeth to enforce its own ruling. One can and should rightfully ask, why do the agencies even bother to engage in a hearing to only allow the offending party to blithely ignore its ruling?

FEDERAL CASE TO FORCE CALIFORNIA TO ACT

ABC TRUST PLANNING – WILL IT BE A BURDEN?

Published on: March 16, 2016 | by Ettinger Law Firm

NEW LAWS MEANS NEW RISK AND LEGAL OBLIGATIONS

President Obama signed into law the American Taxpayer Relief Act on January 2, 2013 which permanently raised the estate tax exemption and added an inflation index, such that it rises every year to account for inflation. Better still, the same law allows for spousal portability of estate tax exemptions, which this blog recently examined . The amount for 2016 is $5.45 million per person, $10.9 million per couple. This is a significant change from just 2008 when it was $2 million dollars and even as low as $675,000 in 2001 and $1 million in 2003 which was not that high considering that most people pay off their mortgage and probably have substantial retirement assets by the time they of retirement age.

For those amongst us who continue to work because that is part of their identity and not out of necessity, the $1 million threshold could easily be met. With the much larger $5.45 million exemption, less than .3 percent of estates in this country will met that threshold. So for all of those couples and individuals who planned on the much lower threshold your plans were likely well designed, but only under the then lower tax exemption. Now, with the much higher threshold and spousal portability, it is best to reexamine these estate planning documents. If one of the previous tools that you employed to insure lower tax liability was the AB trust also known as a bypass trust or even a family trust, it is likely that this will no longer serve you, your spouse, your estate or your heirs. Very briefly, depending on the size of your estate, it may no longer provide as great of tax relief as it once did and may unduly restrict your spouse by limiting their income, increase accounting costs, impose unneeded legal filing and generally complicate their life with other unforeseen complications that no longer serve their purpose.

MAJOR NURSING HOME CASE TESTING MANDATORY ARBITRATION CLAUSE

Published on: March 15, 2016 | by Ettinger Law Firm

CASE OF POTENTIALLY NATIONAL IMPORTANCE REPORTED IN NEW YORK TIMES

On August 21, 2009 a tragic event occurred at a nursing home in the quaint coastal town of South Dartmouth, Massachusetts. Elizabeth Barrow was over 100 years old at the time of the tragedy, but told her son on her birthday when she turned 100 that she wanted to live to be 104. The New York Times article describes her as a sweet, compassionate woman full of verve and love even in her advanced age. She was known around the nursing home as offering people hugs. It is no surprise that she made friends quickly and was quite popular amongst the fellow residents. Mrs. Barrow entered the nursing him in 2006 with her husband, with whom she shared a room. She felt fortunate just the same because her room gave her a terrific southern exposure, which helped her grow her beloved african violets. Then in 2008 Ms. Barrow’s new roommate moved in with her, after the new roommate had an argument with her previous roommate.

The exact nature of the relationship between Ms. Barrow and her roommate and very much in dispute. What is known is that soon after Ms. Barrow’s death the local District Attorney filed second degree murder charges against the 98 year old roommate. Soon after the charges were filed, the Defendant was found incompetent to stand trial. As of the time of the writing of the New York Times article, the Defendant was still alive at 104 in a local state hospital. Given her advanced age it is unlikely she will ever stand trial.

IRS ART ADVISORY PANEL

Published on: March 14, 2016 | by Ettinger Law Firm

GOVERNMENT HAS BEST AT HAND – FOR FREE

Whenever a taxpayer submits tax documents that deal with a work of art or of cultural significance that is valued at least $50,000, according to the taxpayer’s own estimate, the IRS goes through a process by which it independently evaluates the items. The IRS has on hand the very best of the best when it evaluates art and cultural items. More specifically, it has the Art Advisory Panel of the Commissioner of Internal Revenue, which is composed of the very best of the best when it comes to art evaluation. Better still, at least from the perspective of the IRS, they are volunteers and only reimbursed for travel and related costs.

It is relatively easy to understand that they would evaluate paintings, such as Degas, Monet and Van Gogh or photographs from the likes of Matthew Brady, Edward Curtis or Dorothea Lange. But things such as collections of samurai swords, vases and other decorative items from Tang era China, and even doll collections also are considered. The panel may not have a very important sounding name, but they do wield considerable influence over particular tax cases. Any time a work of art worth more than $50,000 changes hand, is donated to charity or gifted, the government wants to know the true value of the property.

ESTATE PLANNING FOR FAMILY OWNED FARMS

Published on: March 11, 2016 | by Ettinger Law Firm

ESTATE PLAN AND CONTINUATION OF FARM PLAN

No doubt that anymore the running of a family farm is much like running a small business with other family members intimately involved. Often enough the continuation of the family farm requires that the current and main farmer, much like the ‘president and CEO’ of a small business, think ahead and plan for the transition of the farm to the next generation. Unlike a small business, however, the planning for the transition of a farm involves a recognition of a tradition that does not usually come into play with the transition of a small business. The issue of tradition is something that even the best lawyer in the world cannot advise you on. But a lawyer can help bring form to your intentions, so that when you do pass on the torch to the next generation it will be smooth and seamless. It requires the he use of traditional estate planning tools, including a combination of tools such as wills, trusts, powers of attorney or any other legal device or document, as deemed best by you in consultation with your estate planning attorney.

In addition, transition of the farm requires you to have a business succession plan, as the farm, just like a small business, is almost assuredly a legal entity. Family owned and operated farms pass from generation to generation much less than tradition would have you believe. Only approximately 30 percent of family run businesses successfully transition from one generation to the next. It is likely that because of this statistic that those in attendance at the 2016 American Farm Bureau Federation’s Annual Convention and IDEAg convention held this year in Orlando, Florida in January heard speeches in regards to the wisdom of creating a farm or business succession plan coupled with proper estate planning to insure the continued viability of family farms.

LONG TERM CARE THROUGH LIFE INSURANCE POLICY

Published on: March 10, 2016 | by Ettinger Law Firm

CONVERSION OF LIFE INSURANCE DURING LIFE OF COVERED INDIVIDUAL

As this blog discussed in the past, long term planning insurance is something that many consumers are reluctant to purchase for a number of reasons One of the main reasons for this reluctance is the long term cost may not financially justify its utilization. Life insurance companies recognized this problem and started to allow for a hybrid financial product in their life insurance policies. The life insurance company allows for the conversion of a life insurance policy to pay for the long term care services.

The animating philosophy is that there will be a pay out regardless of whether or not it happens during the insured’s lifetime, so the life insurance company could just as easily pay out on the policy during the insured’s life. Every day over 10,000 baby boomers turn 65, so the population base that could potentially utilize such as a product is growing larger every day. It is estimated that at least 70 percent of the baby boomer population will need some sort of long term care during their lifetime, with 40 percent in need of nursing home treatment.

TRUST MODIFICATION IN NEW YORK

Published on: March 9, 2016 | by Ettinger Law Firm

THE PROBLEM AND THE LAWS RESPONSE

Sometimes when a person creates a trust they do not know all of the material facts, indeed cannot know all of the material facts regarding what is in the beneficiary’s best interest. Perhaps the trust expressly states that the beneficiaries cannot receive payment from the trust until they reaches 25. What happens if one of the beneficiaries is diagnosed with a medical condition with treatment that is not covered by his/her health insurance? Surely it would seem appropriate to allow the trustee or the beneficiaries to modify the terms of the trust. Situations such as these have always been an issue since the creation of trusts and Courts have dealt with this issue, with reported opinions going back centuries. One famous case that allowed for the beneficiaries to reform or modify a trust, Saunders v. Vautier, came out of England in 1841.

The principles outlined in the case helped to dictate the common law throughout Anglo-American law, namely that as long as the beneficiaries are all of the age of majority and not under legal disability a Court should allow a party to modify the terms of a trust. But unfortunately life is so much more complicated than that. Look at the tragedy of Bobbi Kristina Houston. Following Whitney Houston’s passing, her daughter (Bobbi) stood to inherit her estate in stages with the first disbursement of approximately eight million dollars at the age of 21. Bobbi’s grandmother Cissy Houston and aunt Marion Houston both sought to reform the terms of the trust granting Bobby Houston such sums, arguing that she, the beneficiary, would be at heightened and unacceptable risk of undue influence of third parties. When there is an allegation of undue influence, it is often the case that the trustor or settlor is alleged to have been under undue influence, not the beneficiary that may fall prey to undue influence. The need to reform a trust may have more mundane reasons such as mistake. Take the not uncommon example of a trust created in a will, called a testamentary trust, of a husband and wife, who, other than their names and other identifying information, have identical wills. At the signing of the wills by the parties, they mistakenly sign each other’s will and not their own.

TOOLKIT TO HELP PREVENT SENIORS FROM FALLING

Published on: March 8, 2016 | by Ettinger Law Firm

SIMPLE GUIDELINES, EASY TO UNDERSTAND AND FOLLOW

The Center for Disease Control (CDC) released guidelines to help prevent and mitigate falls among senior citizens in 2012. The CDC program is called STEADI, an acronym coming from the full title Stopping Elderly Accidents, Deaths and Injuries. Research shows that falls are the leading cause of injuries, death and emergency room visits for trauma. If a senior citizen falls it can literally be a traumatic, life altering event or even a deadly one. The silver lining is that many falls are preventable. Last year the Obama Administration announced that that the White House Conference on Aging, the Administration on Aging awarded $4 million in various grants to help expand STEADI. It is estimated that the increased funding will help reach an additional 18,000 at risk senior citizens. It is further hoped that the funding will increase participation in evidence based community programs and improve the overall programs long term viability. The CDC developed these guidelines in conjunction with British and American Geriatric Societies.

The American and British Geriatric Societies already had clinical practice guidelines in place to better define the various risk factors in falls by senior citizens. The CDC guidelines contain basic information about falls, methods to begin conversations with seniors, balance assessment tests, gait assessment tests along with instructional videos for the gait and balance tests and even case studies of the the fall risks for different senior citizens. The program and recommendations are all inclusive in that the STEADI program at the CDC website has a testing protocol for professional medical care providers, to information about webinars and other instructional videos, material for senior citizens themselves, important facts about falls, referral forms, posters for professional establishments, with posters also available in Spanish and Chinese and most importantly, it has a toolkit for medical professionals.

WRONGFUL DEATH LAWSUIT AS PART OF PROBATE ESTATE

Published on: March 7, 2016 | by Ettinger Law Firm

PROBATE IS UNAVOIDABLE

It is a fact of life that we can never plan for the worse case scenario and there is always risk in anything you do. The law recognizes this special risk, at least in part, in wrongful death lawsuits. In order for a wrongful death action to proceed, a party must apply to the Surrogate’s Court to act as the personal representative of the estate. In essence, that person must stand in the shoes of the deceased for purposes of the wrongful death action. Any and all settlement or award monies must pass through the probated estate under the jurisdiction of the Surrogate’s Court. This can present special issues if you already have a will, but no trust or other legal device to bypass the probate process and your estate is close to the estate tax exemption threshold. The federal estate tax exemption is currently set at $5.45 million dollars.

Anything above the Federal exemption is taxed at a heavy 40 percent. New York’s estate tax exemptions are changing and will continue to change until 2019 when it will match the Federal government’s exemption amounts. After 2019 there is an added problem with New York’s estate tax exemption; specifically, if the entirety of the estate exceeds the exemption amount by five percent, the entirety of the exemption is forfeited and the entire estate is taxed. That means that if your estate is say, for example, 120 percent of the exemption amount, the entirety of your estate will be taxed under New York rates. At the same time, 20 percent of your estate will be taxed at 40 percent. It is important to note the difference between the exemption amount and the taxable rate.

OPERATION COCOON: FEDERAL EFFORT TO CURB UNWITTING SENIORS FROM ACTING AS DRUG MULES

Published on: March 4, 2016 | by Ettinger Law Firm

On February 10, 2016 the United States Immigration and Customs Enforcement (‘ICE’) announced in a policy document that appears to coincide with ranking ICE officials testimony before the United States Senate Special Committee on Aging that it recently launched ‘Operation Cocoon‘ to help curtail the use of “elderly citizens” unknowingly acting as drug couriers, or drug mules as couriers are sometimes referred to as, from foreign countries to the United States or to other foreign countries. While not part of the policy document released, typical of the victims of such scams is J. Byron Martin a 77 year old retired minister from Maine, who thought he was helping a fellow soul by transporting what he believed to be books from Peru to London via Spain.

It turned out that the books in issue had drugs secreted away in them. Mr. Martin’s son, Andy Martin of Henderson, Nevada testified that his father was never arrested in his 70 plus years on this planet prior to this episode. Mr. Martin is now serving a seven year sentence of incarceration in Spain. Senator Susan Collins presided over the hearing and indicated that the ensnared seniors are duped into transporting the drugs, those with the requisite criminal intent secret the drugs away in “chocolates, picture frames, tea, markers, canned goods, shampoo bootles, soap and wooden hangers.” The hearings were an effort to get the word out about this very serious danger. Both the Senate Committee on Aging and ICE operate a toll free number to report suspected scams. That number for ICE is (866) DHS-2-ICE; (866) 347-2423. The phone number for the Senate Committee on aging is (855) 303-9470.

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