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PLANNING FOR MARRIED MEDICAID APPLICANT’S COMMUNITY SPOUSE – COMMUNITY SPOUSE INCOME

Published on: February 1, 2016 | by Ettinger Law Firm

When a married person applies for Medicaid, the government looks at the collected, or, pooled, resources of the two to determine if one of the two spouses is eligible for Medicaid. If the combined income of the two spouses is above the income threshold set by law, the balance must be paid to the nursing home of the dependent spouse. But what income provisions are allowed for the spouse who remains in the community? What do the get to keep? Is the community spouse allowed to tap into the income of the dependent spouse if his/her income is not enough?

The legal, financial benefits that allow for the community spouse to keep a certain amount of income has the terrible name of spousal impoverishment standards. This contains an amount of money, known as the minimum monthly maintenance needs allowance (commonly known as or referred to as the MMMNA). The figure from July 1, 2015 to June 30, 2016 is $1,991.25 per month. Starting on January 1, 2016 the maximum monthly maintenance needs allowance is set at $2,980.50 per month. This is the maximum the community spouse may keep before being required to contribute to the medical needs of the dependent spouse (NOT minimum, so not to be confused with the MMMNA).

WHAT IF THIS IS NOT ENOUGH?

PRETERMITTED OR OMITTED CHILDREN NOT ADDRESSED IN A WILL

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

Contrary to the European model, American parents are legally free to disinherit their children, but at the same time, they cannot simply forget or omit their children in their will by mistake. If the child is specifically addressed in the will and, at the same time, the will either fails to pass any property or assets on the child or specifically disinherits the child, there is nothing that the child can do to inherit something from the estate, aside from invalidating the will and potentially inheriting under the intestacy statutes. Children born after a will is created and not properly addressed in the will, via language that is expansive and inclusive that undoubtedly includes even children born or adopted after the specific will is created are referred to in the law by the ungainly term pretermitted children.

Not surprisingly it comes from a latin verb meaning to overlook or forget. New York’s law that addresses pretermitted children and found at NY EPTL §5-3.2, only addresses children born after the creation of a last will and not otherwise provided for by other means, such as life insurance proceeds, a trust or other assets. The children that fall under the pretermitted law protections are entitled to whatever the other children who are addressed in last will. Oddly enough, if the children born before the creation of the will are mentioned but unprovided for, the pretermitted child will not inherit anything. Indeed, the law specifically addresses this possibility, insofar as it indicates that “(1) If the testator has one or more children living when he executes his last will, and: (A) No provision is made therein for any such child, an after-born child is not entitled to share in the testator’s estate.” NY EPTL §5-3.2. Certainly there are many problems with this, insofar as some parents specifically disinherit their children. Anna Nicole Smith disinherited her son in her last will and then had a baby daughter only a short time prior to her passing away, without any change in her will.

RATHER COMMON PROBLEM WITH SIMPLE SOLUTION

INHERITING A LEASE

Published on: December 12, 2015 | by Ettinger Law Firm

VALUABLE ASSET

A residential lease in New York City or any desirable locale can provide many benefits. Some people wait years to get into a rent stabilized apartment. There is even a Seinfeld episode where Elaine quips that some people scan the obituaries to see if someone in a rent stabilized apartment has passed away. It is a common occurrence for many people to live decades and raise generations of families in their rent controlled rental unit. Many cities have their own laws dealing with how to inherit these leases. New York Real Property Actions and Proceedings §236 law deals permits an estate to inherit the lease of a deceased person and New York Estate Powers and Trusts Laws §13-1.1(a)(1) also holds that a lease is an asset of an estate. In addition, many local laws housing and regulations also mandate how and when a lease may be inherited. New York City ended its Rent Control laws in 1971, yet still has approximately 38,000 rental units listed under the old Rent Control laws, as once the lease is under the Rent Control law it remains until it is no longer. Going forward New York leases are generally covered by Rent Stabilization laws, also covered by the same laws dealing with succession of a residential lease. Rental units under the rent stabilization laws are the most common type of residential lease. These leases will remain for so time due to the right to succeed these leases by other family members or even friends. Most particularly, New York Code, Rules and Regulations §2532.5(b) allows for family members to succeed the lease. Landlords have been known to fight like the devil to regain possession of these rentals, sometimes offering cold hard cash, from $40,000 on the low end to $17,000,000 on the high end.

HOW TO INHERIT OR SUCCEED – COHABITATION

ANTICIPATED CHANGES IN IRS RULES REGARDING FAMILY BUSINESS VALUATIONS

Published on: December 8, 2015 | by Ettinger Law Firm

WHY IT MATTERS FOR ESTATE PLANNING

Every year the Federal Department of Treasury publishes the greenbook which outlines the then current presidential administration’s revenue proposals, tax policies, job creation issues that relate to the Department of Treasury and other related fiscal and policy issues. The greenbook is scrutinized by tax pundits, politicians and others for what it contains, but what it does not contain is also important. Within the 2013 greenbook, there was an obvious lack of discussion of 26 U.S.C. § 2704, which mandates how the law measures the value of certain family controlled entities for estate and gift tax purposes. Some observers took that to indicate that the IRS plans on amending the regulations pursuant to this statute. This suspicion was validated when an official from the Department of Treasury spoke at an American Bar Association, tax section meeting in May, 2015. She indicated that a proposed regulation may be released as early as September, 2015. As of mid-November 2015 such regulations have yet to be published. This issue is of substantial import for estate planning throughout the nation. If and when a family business is transferred via an estate or even to a trust created by an owner of the business, it is likely be a taxable event, depending on the specifics of the transaction.

PASSING A FAMILY BUSINESS ON TO NEXT GENERATION

PLANNING FOR YOUR PETS IN YOUR ESTATE

Published on: November 12, 2015 | by Ettinger Law Firm

NEW YORK TRUSTS FOR PETS

Some animals are undoubtedly beloved pets. They provide us with love and companionship, while there are other animals that are more than pets. For example, horses are an investment, they are a partner in exercise, they help some children with therapy and a comrade to see the world with if you ever had the distinct pleasure of exploring the wilderness on horseback. Seeing eye dogs or other therapeutically trained animals are literal life savers in some cases. All of these animals are deserving of the full legal protections that you can provide to them. Pet trusts are not tools reserved for the rich and eccentric. As of 2012, 46 states (and the District of Columbia) have laws in effect that allow for pet trusts. In 1996, the New York legislature enacted NY EPTL § 7-8.1, which allows for the care of any pet or animal by way of a trust, which terminates when the beneficiary animal dies. In fact, pet trusts are so popular and well ingrained in the law, that there is a model, uniform law, found at Uniform Trust Code 402. Pet trusts are now practically commonplace.

WILL VERSUS TRUST