New York Estate Planning & Elder Law Blog

In Wills We Trusted

Published on: January 19, 2023 | by Ettinger Law Firm

Ask most people if they’ve done their estate planning and a common answer is, “Yes, I have a will.” However, estate planning is not just a plan for death. It’s a plan for life that addresses what happens if you become disabled. About half of us will eventually becoming disabled. You can choose ahead of time who will be in charge of your affairs if you become disabled through a power of attorney, health care proxy, and a trust.

A will cannot provide for disability. A will tells the world where you want your assets to go when you die. A will is probated, which means proven, in court, and becomes a public document. Those without their own living trust plan, with their personal choices for who will be in charge if they become disabled, risk getting the state’s plan of guardianship proceedings where the court chooses who will handle your affairs if you become disabled.

Probate court proceedings can go smoothly but they may also be complicated, such as having a special needs child or disinheriting a child. Also, if you own property in another state, a trust makes more sense than a will because you may deed the out-of-state property into the name of your trust, and avoid both a New York probate and a probate in the other state.

Strength Training for Seniors

Published on: January 12, 2023 | by Ettinger Law Firm

About a year ago, your writer found that he was having trouble doing the yard work and carrying the trash to the curb. I was getting weaker with age and realized that this trend was only going to go in one direction. So I decided to reverse the decline with strength training. Putting in just three hours a week, I am now stronger than I was thirty years ago.

The British Journal of Sports Medicine reports that just thirty to sixty minutes a week of strength or “resistance” training leads to a ten to twenty percent decrease in heart disease, cancer and mortality. It also increases cognitive function and decreases anxiety and depression. Better yet, you can carry in the groceries or climb the stairs without getting exhausted!

Strength training doesn’t mean you have to go to the gym and start lifting heavy weights. Just doing push-ups, planks, squats, walking up stairs, etc. are all forms of resistance training. You don’t even have to change your clothing, so long as you have enough room to move.

2023 Elder Law Estate Planning Changes

Published on: January 6, 2023 | by Ettinger Law Firm

Happy New Year to all!

There have been significant changes in the law in a number of areas as of January 1, 2023.

The gift tax exclusion, which many people still think is $15,000, is now $17,000, up from $16,000 in 2022. Each person may give up to $17,000 to as many people as they want to without incurring any Federal gift tax liability and without using any of their Federal estate tax exemption at death.

Eight Good Reasons to Plan Your Estate

Published on: December 23, 2022 | by Ettinger Law Firm

1. Makes sure your estate goes to whom you want, when you want, the way you want. Most estate plans leave the assets to the next generation outright (i.e., in their hands) in equal shares. However, with a little bit of thought on your part, and some guidance from an experienced elder law estate planning attorney, you may dramatically improve the way your estate is ultimately distributed. For example, you may delay large bequests until children or grandchildren are older or give it to them in stages so that they have the chance to make some mistakes with the money without jeopardizing the whole inheritance. Similarly, you may place conditions on receipt of money such as “only upon graduation with a bachelor’s degree” or “only to be used to purchase an annuity to provide a lifetime income for the beneficiary”. The possibilities, of course, are endless.
1. Allows you to give back to the people and places that have helped you. Again, most people leave their assets to their children in equal shares. Yet time and again we see children who really don’t need the money or, unfortunately, don’t deserve it. Even when they do need and deserve it, there is a place for remembering those people and institutions who have helped make you what you are today.
1. It proves stewardship by showing your family that you cared enough to plan for them. When you put time, thought and effort into planning your affairs it sends a powerful message to your loved ones. You are saying that you handled the matter with care and diligence. This will reflect itself in how the money is received, invested and spent by your heirs.

Saving Half on the Nursing Home Doorstep

Published on: December 12, 2022 | by Ettinger Law Firm

What do you do when a client comes in to see you and says that his mother is going into a nursing home and she has $300,000 in assets. In fact, mom scrimped and saved all of her life to have this nest egg and now she desperately wants to see her children get an inheritance.

Although you may protect all of your assets by planning five years ahead of time with a Medicaid Asset Protection Trust, all is not lost if nothing has been done and the client finds herself on the nursing home doorstep.

The advanced elder law technique, used to protect assets at the last minute, is called the “gift and loan” strategy. Here’s how it works. Let’s assume, for the purposes of our example, that the nursing home costs $15,000 a month. When mom goes into the nursing home, we gift one-half of the nest egg, in this case one-half of $300,000, or $150,000, to her children. Then we lend the other $150,000 to the children and they execute a promissory note agreeing to repay the $150,000 in ten monthly payments of $15,000 per month, together with a modest amount of interest. Now we apply for Medicaid benefits. Medicaid will impose a penalty period (i.e., they will refuse to pay) for 10 months on the grounds that the gift of $150,000 could have been used to pay for mom’s care for 10 months. Medicaid ignores the loan since it was not a gift. It is going to be paid back, with interest, according to the terms of the promissory note. What happens is that the ten loan repayment installments will be used to pay for mom’s nursing home care during the penalty period. Just when the loan repayments are finished, the penalty period expires and Medicaid begins to pick up the tab. Lo and behold, the children get to keep the $150,000 gift and mom has saved some of the inheritance for her children.

Estate Planning for the Estranged Child

Published on: December 1, 2022 | by Ettinger Law Firm

All too often a client comes in with a sad tale about an estranged child. Naturally, they are at a loss as to what to do about the situation when it comes to leaving that child an inheritance.

Years ago, the famous advice columnist Ann Landers wrote that her all time most requested column for reprint was on this very subject. Ann wrote that an inheritance should be considered a gift and that if the gift is not deserved one should not be expected. While that may have been good advice at the time and perhaps still is in most cases, like many things it is more complicated today.

In practice, we find that many of these once loving sons and daughters have married individuals with borderline or narcissistic personality disorders. Their spouses are manipulative and controlling. They seek to separate the loving son or daughter from their family so as to better control their spouse. The estranged child knows from experience that going against the wishes of their narcissistic spouse is like throwing gasoline on a fire — so they go along to get along.

Keeping The Lights On

Published on: November 17, 2022 | by Ettinger Law Firm

Adapted from author Doug Armey, the following are keys to keeping your brain “lit” as you age.

Flow. A sedentary life causes brain deterioration. Blood flow to the brain keeps oxygen in your brain cells which gives them life. Keep moving, walking and get some exercise.
Energize. Junk food clogs your arteries and lowers energy, causing a sedentary lifestyle. Healthy food gives energy to your body and brain. Refuel and brighten the lights.

Powers of Attorney Are for Everyone

Published on: November 11, 2022 | by Ettinger Law Firm

What happens if you have an accident or an illness whereby you are unable to handle your legal and financial affairs? Many people incorrectly believe their spouse is legally able to handle their affairs. Similarly, a parent has no legal authority to handle the affairs of a child, once the child attains the age of majority – eighteen years.

Without a power of attorney, you would have to apply to a court to be named a legal guardian. These proceedings are expensive, time-consuming and fraught with peril. The judge has no obligation to name the spouse or parent as legal guardian and may appoint a stranger. For example, the judge may feel that the spouse or parent has a conflict in that they are the beneficiary of the incapacitated person’s assets, or the judge may decide that someone else has more knowledge and experience in handling such matters.

Who should you choose as your “agent”? In our experience, the vast majority of powers of attorney name the spouse first and one or more of the children second. While on its face this seems reasonable, experience has shown it may not be a good idea. We often need to use the power of attorney when the client is quite elderly and infirm. Often, so is the spouse at that time. Son or daughter wants to step in and help out with bill paying, etc. only to find they are unable to use the power of attorney for dad unless they can prove that mom can’t.

The Secure Act and Your IRA

Published on: November 2, 2022 | by Ettinger Law Firm

The Secure Act governs distributions from IRA’s and other retirement plans. After the death of the account holder, most named beneficiaries are required to take the funds out over ten years.

While the IRS has not finalized the regulations, the safest approach is to take minimum distributions for the first nine years, based on the life expectancy of the beneficiary. More may be taken, and taxes will be based on that amount. The way the minimum distribution works is as follows. Let’s say the beneficiary has a life expectancy of forty years when the account holder dies. In the year following the account holder’s death they must take one-fortieth, the following year one-thirty-ninth, and so on until year ten when they are required to take the retirement account balance in full.

There are a few exceptions to the ten year rule. Spouses may roll the inherited IRA into an IRA of their own and continue it for their own lifetime — generally waiting until they are 72 to start taking required minimum distributions (RMD’s) unless they need the funds earlier.

Book Review: John Leland’s “Happiness is a Choice You Make”

Published on: October 21, 2022 | by Ettinger Law Firm

In his book, subtitled “Lessons From a Year Among the Oldest Old”, journalist John Leland takes us on a journey into uncharted territory. Mr. Leland spent a year with six elderly New Yorkers, exploring their lives.

He divides the book into the first six chapters chronicling the years spent with each of the six — John, 97, living in the same Manhattan apartment for forty-six years, the last six of them alone after the death of his partner; Fred, 87, a World War II vet and retired civil servant living in a three-story walk up; Helen, 90, living in The Hebrew Home in the Bronx, dating Howie, living down the hall; Ping, 89, providing an Asian perspective, living in a rent-controlled apartment with a Medicaid paid home attendant for seven hours a day; Ruth, a feisty 90, in assisted living in Sheepshead Bay, Brooklyn and, finally, Jonas, 92, an active filmmaker and writer.

Along with the author, we live the lives of these six people from getting up in the morning to going to bed at night. “How did they get through the day, and what were their hopes for the morrow? How did they manage their medications, their children, and their changing bodies…” Further, says Mr. Leland “All had lost something: mobility, vision, spouses, children, peers, memory but few had lost everything.” What the author found was that the “oldest old” are not a different species, as so many people see them, but rather much the same as you and me — getting up each morning with wants and needs and doing the best they can with what they have. Nevertheless, older people report a greater sense of well-being and fewer negative emotions than younger people. “Experience helps older people moderate their expectations and makes them more resilient when things don’t go as hoped.” We learn the many ways his six seniors chose to be happy.