When Your Loved One Does Not Leave a Will

The process becomes more complicated and elaborate, when no will is left by the deceased. An application to determine heirship may be required along with an application for Letters of Administration.

The court determines who is entitled to inherit the property in question through an heirship proceeding which includes the consideration of spouses, children, grandchildren, siblings, parents, etc.

In the heirship proceeding, the Court generally appoints an attorney ad litem which conducts independent investigation into the decedents of the deceased to assist the court in determining the heir.

Once the ad litem proffers a report, an heirship hearing occurs presided by a judge. Two disinterested witnesses, meaning those unrelated to the deceased, are required to testify regarding the heirs.

Satisfied that all heirs have been discovered, the presiding judge will sign a judgment, documenting these heirs along with the percentage each heir is entitled to receive of the estate.

The judge will then issue Letters of Administration to the person chosen as the administrator. Letters of Administration serve essentially the same purpose as Letters Testamentary.

Elder Law 101: Nursing Home Care vs. Assisted Living

How Do Nursing Homes Differ from Assisted Living

Nursing home lawyers provide assistance in making an advanced plan to get you care required as you get older or if you experience illnesses or injuries that make you unable to care for yourself any longer.  

As you experience age-related sickness or the affects of illness, there is a substantial chance you will some day require care in an institutional care environment.  

In fact, as Wall Street Journal explains, more than 70 percent of people who reach the age of 65 will require nursing home care at some point in the future.  

You’ll need to make sure you are prepared to move to the right environment — and to pay for the care you require.

Most nursing homes cost upwards of $5,000 a month for care.

The Weaver Firm attorneys can help you understand your options for nursing home care or other care you might require.

In particular, you should consider the differences between nursing homes and assisted living facilities so you can make a fully informed choice regarding which environment is right for you.

If you want help in understanding the different options for senior living when you cannot live alone any longer, you can give us a call at any time to talk with nursing home lawyers at our firm.

Assisted Living vs. Nursing Homes

Assisted living and nursing homes both provide an option for seniors who can no longer live independently but as the New York Times explains, there are important differences.

Assisted Living Facilities

Assisted living facilities generally provide a more home-like environment while nursing homes have a more institutional or hospital-like feel.

These homes may involve seniors living more independently in their own rooms or their own apartments, while nursing homes generally provide semi-private or private rooms with much less privacy and autonomy than assisted living facilities offer.

While an assisted living facility can feel more like living independently for seniors, this independence makes assisted living facilities unsuitable for many seniors who require more hands-on help.  

Assisted living facilities may offer housekeeping services, meals, activities, and some help getting medical care, assisted living facilities typically do not provide the same level of supportive services that a nursing home does. 

The New York Times also indicates that nursing homes are more heavily regulated than assisted living facilities. 

Assisted living facilities are covered by VA aid and attendance. The rules for this program are complex but are not nearly as intense as Medicaid rules.

Some facilities have an assisted living section and a nursing home care section for seniors who are attracted to the idea of assisted living but who may need nursing home care in the future.

If you think this could be an option, you should make sure to find out what the rules are for when and how different kinds of care can be paid for. 

Getting Help from Nursing Home Lawyers

How much does it cost to stay in a nursing home?

The average cost of a private room in a nursing home is more than $90,000 a year.

What are ways to pay for a nursing home stay?

There are four main ways to pay for a nursing home stay:

  1. Cash out of your pocket
  2. Medicaid
  3. Private Long Term Care Insurance
  4. Medicare

How does Medicaid pay?

Medicaid is a joint federal and state government program that helps people with low income and little assets pay for their nursing home cost.

Generally, to be eligible for Medicaid, your income and asset levels can’t exceed levels set forth in your state.

Medicaid officials will “look back” at your financial information over a certain number of years to determine if you have been getting rid of property in order to receive Medicaid.

However, if you have assets over the allowable level, you are permitted to “spend down” or decrease your assets before you receive Medicaid.

Typical spend down costs include medical expenses, mortgages and other debts, and funeral expenses.

Also, your house and car are generally not counted against you for qualification purposes, and therefore don’t have to be spent down.

States vary in their eligibility requirements, so you should check with your state social services office or an elder law attorney for specific information.

Also, keep in mind that not all nursing homes accept Medicaid, so you’ll need to ask about a particular nursing home’s policy. 

Nursing home lawyers at the Weaver Firm can provide assistance with the process of making a plan to get nursing home care or to get care in an assisted living community.

We can also provide guidance on reviewing nursing home facilities and assisted living facilities to find the right care environment for your particular circumstances.

Because the costs of care can be expensive and are not covered by Medicare or by most private insurance, we also provide assistance with the creation of a Medicaid plan so you can protect assets while getting Medicaid to cover the costs of your care. 

Contact us today at 817.638.9016 or RWeaver@weaverlegal.net

What Are the Warning Signs of Alzheimer’s Disease?

The symptoms of Alzheimer’s and dementia develop slowly over a number of years Sometimes these signs are mistaken for normal, age-related mental decline instead of the result of a more serious problem.

Because the symptoms progress slowly, it’s easy for loved one’s to deny they even exist until an event happens that is so uncharacteristic or bizarre that the symptoms become undeniable.

We’ve seen this type of denial in our family.

Look for the below-mentioned signs and consider a planning meeting with our attorneys before the situation deteriorates beyond repair.

According to the Alzheimer’s Association, the following are ten warning signs of Alzheimer’s:

  1. Memory loss that disrupts daily life, especially newly-learned information. Early symptoms include repeatedly asking the same questions, and increasingly relying on memory aids, such as notes, to recall routine tasks.
  2. Challenges in planning or solving problems. The onset of Alzheimer’s can make it difficult keep track of finances, and plan and cook meals. Sometimes, people give gifts or make unusual purchases.
  3. Difficulty completing familiar tasks at home, work, or leisure, such as driving to a familiar location or recalling the rules of a game.
  4. Disorientation of time or place. Those with Alzheimer’s can experience confusion about where they are, how they got there, or what day it is.
  5. Trouble understanding visual images and spatial relationships, such as depth perception. This leads to people tripping on stairs or ledges and can cause physical harm.
  6. New problems with words in speaking or writing. People with Alzheimer’s struggle with remembering the right word or use the wrong word to describe familiar objects. Sometimes, people will avoid discussing certain issues or avoid situations altogether to cover up these signs.
  7. Misplacing things and losing the ability to retrace steps to locate them. This includes keys and medications.
  8. Poor or impaired judgment. Those with Alzheimer’s may be more prone to give away large sums of money to telemarketers, dress inappropriately, or keep up with personal hygiene. They may even forget to eat for days at a time.
  9. Withdrawal from work or social activities.
  10. Changes in mood and personality. Symptoms can include mood swings, anxiety and delusions.

Our recommendations if a loved one is experiencing these symptoms:

The Alzheimer’s Association recommends seeing a doctor right away if you or someone you love experiences any of these symptoms because early diagnosis and treatment can delay the progression of Alzheimer’s.

In our pre-planning session, we discuss estate planning documents to protect your loved ones and options for long term care including Medicaid and VA planning.

Schedule a meeting today. 817.638.9016 or RWeaver@weaverlegal.net

How the Tax Plan Affects You in 2018

On December 22, 2017, President Trump signed into law new tax legislation (the “2017 Tax Bill”). The 2017 Tax Bill makes significant changes to the tax code, including a reduction in corporate tax rates, major changes to individual taxes, a repeal of the Health care mandate, and a number of other changes.

This update focuses on how this law affects individuals from an estate planning and tax perspective, including charitable gift planning, taxation of trusts and estates and asset transfers for planning purposes.

Estate Tax Exemption Doubles to Approximately US$11.2 million per Individual.

Rockefeller would be proud. The 2017 Tax Bill keeps the estate and gift tax at 40% but doubles the estate tax exemption to approximately US$11.2 million per individual (US$22.4 million per married couple), beginning on January 1, 2018. This increase also applies to the exemption from generation-skipping transfer (“GST”) tax, which also increases to US$11.2 million per individual (US$22.4 million per married couple). In layman’s terms, this means your estate will not pay taxes as long as it remains under $11.2 million. If you have a taxable estate, come see us right away so we can begin the planning process.

The other rules applicable to gift and estate taxation, such as heirs receiving fair market value basis for assets received from an estate, stay the same.

This US$11.2 million exemption will continue to be adjusted for inflation each year. Along with most other changes to the individual tax regime, this increased exemption is scheduled to expire after 2025. This increased exemption creates significant planning opportunities for individuals, particularly those with estates in excess of the increased limits. 

Clients Should Consider Using This Increased Exemption Starting in 2018

Clients should consider making gifts (either outright or in trust) in order to utilize this increased exemption, particularly since this increased exemption is scheduled to expire at the end of 2025. In addition, other estate planning techniques, such as GRATs and sales to grantor trusts, can still be used under the new 2017 Tax Law. 

Clients Should Review Current Estate Plans in Light of the Increased Exemption

One planning item to consider is that many clients have wills and other estate planning documents that use formulas based on the exemption amounts available at the client’s death. For example, an individual’s will may leave an amount equal to her available exemption from the estate tax to her children (either outright or in trust) and the balance over the exemption to her spouse. Without changing her documents, the change in the law increases the amount passing to the children and decreases the amount passing to her spouse by more than US$5 million. Accordingly, clients should review their current estate planning documents to ensure that their plans and these formulas still accurately reflect their wishes in light of the dramatically increased exemption amounts.

In addition, clients who live in New York State and whose estate planning documents fund trusts with the entire federal exemption amount may owe significant New York estate tax on the death of the first spouse and, therefore, may wish to review the structure of their estate plans. Clients living in other states that have state estate or inheritance taxes may also have similar tax considerations.

529 Plans May be Used for Educational Expenses for K-12 

The Tax Bill also expands the use of 529 plans so that they may be used for K-12 education. 529 plan funds (up to US$10,000 per year per beneficiary) can now also be used for tuition expenses for any elementary or secondary school, including public, private, or religious schools. Previous law only allowed 529 plan funds to be used for college and other post-secondary programs and expenses. A previous provision also allowed 529 plan funds to be used for homeschooling expenses, but that provision was removed from the final 2017 Tax Bill.

Limit on Deductions for Charitable Cash Contributions Increases to 60% of AGI

In addition, although the 2017 Tax Bill limits a number of income tax deductions, it does increase the deductibility limitation for cash contributions to public charities from 50% to 60% of adjusted gross income. This increase is scheduled to expire after 2025. Other charitable contributions (such as contributions of appreciated property and contributions to private foundations) are still subject to the 30% (and in some cases 20%) of adjusted gross income limitations, and the ability to carryover unused charitable contribution deductions for five years remains unchanged. 

Many Changes to Individual Taxation Also Affect Trusts and Estates, Including the New 20% Deduction for Certain “Pass-through” Income

Many of the changes to the taxation of individuals (e.g., reduction in tax rates, limitation on state and local income tax deductions, etc.) will also apply to trusts and estates. 

However, one change of particular importance for trusts and estates is the deduction for income received from pass-through entities. 

Under the 2017 Tax Bill, trusts and estates are entitled to take the 20% deduction for pass-through income also applicable to individuals, which creates an effective tax rate of 29.6% for most pass-through income earned by a trust. While beyond the scope of this discussion, certain restrictions apply to the availability of this deduction. It is important for trustees of trusts that own interests in pass-through entities to understand the effect of these rates on fiduciary income tax obligations. 

Conclusion

Although the ultimate scope and effects of the 2017 Tax Bill will continue to unfold, the most significant change from a transfer tax and estate planning perspective is the doubling of the estate, gift and generation-skipping transfer tax exemptions to approximately US$11.2 million beginning on January 1, 2018.

For questions or concerns about tax planning, please contact us immediately at 817.638.9016. Don’t wait until you’re facing an enormous tax bill!

The Most Important Things You Need To Include In Your Will

A will can accomplish many different legal tasks, including naming heirs, naming guardians for minor children, and naming an executor to take care of your estate. Many people can get by with a simple will that has a few important provisions. You can even draft your own Will as long as you carefully follow state specific instructions for execution and drafting. If you have questions, come see a qualified Estate Planning Attorney. Here is what your Will needs to include.

Choose Who Receives Your Property…Who Gets What

Many people will want to leave all of their property to their spouse or children. This is standard. Here is what you don’t usually think about.

First, you may want to spell out what should happen if one of your beneficiaries passes away before you do. We often see people who leave all of their estate to one beneficiary and forget to include a back up plan. In many cases, you can simply state that their share will be divided equally among the remaining heirs based on current intestacy laws. Don’t forget your backup plan.

You may also want to include a survival clause. For example, if you both you and your spouse are involved in an accident, there is a possibility that your assets could have to go through probate twice if one of you passes away shortly after the other spouse does. You can designate a longer survival period to avoid this problem. Standard survival is 120 hours or 5 days for the math majors out there.

Name an Executor…Who is the Boss

The executor is in charge of administering the estate. Many people choose a family member or someone else with the necessary skills to complete this task. This person needs to be trustworthy and should immediately move to secure the Estate after you die.

You should also consider choosing a backup executor just in case your primary executor is unable to serve or refuses or resigns. This position does require some legal or business knowledge, so make sure you choose someone with those skills.

Other Important Will Language

The following are a few additional things you should include in your last will and testament:

  • State that you are revoking all prior wills to avoid a potential conflict between the new will and a prior will.
  • Include a residuary clause, which controls what happens to all property not specifically mentioned in the will. This ensures that any property you acquire after drafting the will is still distributed to your designated heirs.
  • If you have minor children or a trust, you should name any trustees and guardians in your will.

Every family is unique, and very few Wills are “simple.” If you have questions about what to include in your will, give us a call and let us craft a plan for your family.

817.638.9016

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Founding Fathers had Wills and So Should You

Ever wondered what a founding father’s Last Will and Testament looked like? Probably a lot like yours. Ben Franklin provides an excellent look into several issues regarding what you leave and to whom.

Sam Moak, an attorney in South, Texas, has a great breakdown of Ben Franklin’s Will. Here are some of the highlights.

Franklin gave his son William all of his property in Nova Scotia “to hold to him, his heirs and designs forever.” William is what we consider a primary beneficiary because he received the property outright from the will. Much like you might leave your home to your children or to their children, Ben Franklin kept his property in his bloodline.

Franklin owned three homes on Market Street in Philadelphia, other property within Philadelphia and pasture land outside the city. These are probably worth a pretty penny nowadays. Ben transferred the right to use that property together with his “silver plate, pictures and household goods” to his daughter Sarah Bache and her husband Richard Bache for use “during their natural lives.” 

This gift created a life estate. You may have a home or other real property and desire for a particular person to use that property for his or her lifetime. A life estate is an excellent way to give a person life use of property. Clients often use this type of gift to ensure a piece of property remains in the family for multiple generations. Children can’t sell the property, but can live in the home forever. Think a family ranch for a Texas specific example.

If you create a life estate for a person, then you may also designate a person or perhaps a charitable organization to own the property after your life tenant passes away. Make sure to visit our site for an upcoming article about charitable giving and how it might be a great idea for you.

Ben Franklin’s intent was to transfer property to his daughter and son-in-law for life, with the remainder to his grandchildren. But what if one of the grandchildren were to pass away prior to the demise of both parents? Franklin indicated that if one of the grandchildren were “to die under age, and without issue,” that share would be “equally divided among the survivors.” This is an example of a contingent beneficiary.

A contingent beneficiary is the person who will receive the property if the first person is not living at the time of the transfer. For example, you may wish to give a gift through your Will to a brother or sister. But if he or she passes away before you do, then it is important to select another person to receive the property. We often see DIY Wills where a client names a primary beneficiary but fails to name a successor beneficiary. 

Franklin also realized some of his grandchildren might be young if and when their parents passed away. Franklin stated in his Will that some of them are “under age” and “may not have capacity” to manage the property. Therefore, he ordered the Supreme Court of Pennsylvania to select “three honest, intelligent, impartial men” to manage the property. 

If your estate plan includes young children, then you will want to create a trust to manage property for the benefit of the children. The trust should work to provide a distribution of income and, if needed, principal from the trust to the child until the recipient reaches an age you designate for distribution of the assets. In Texas, children under eighteen (18) cannot inherit property outright. Instead of going through the expensive and time consuming process of petitioning the Court (not the Supreme Court in this case, but a Probate court) to create a Trust, consider having an attorney draft this trust as part of your Last Will and Testament.

If you don’t have a Will, don’t panic. Wills are simple to draft and easy for attorneys to set up. Over 60 percent of people pass away without Wills. Your property will eventually get to your heirs-at-law, but the process is more expensive and time-consuming.

Come see us for an Estate Planning meeting right away! 817.638.9016.

$100,000.00 Hotel Room? Only in Aggieland

Texas A&M recently auctioned off the rights to premier rooms located in their on-campus hotel. If this sentence is confusing, you aren’t alone. As tax deductions for things like football and basketball suites become increasingly scarce, the Aggies decided to get ahead of the curve with hotel room licensing.

Basically, Texas A&M will allow you to pay $100,000.00 (if you win an auction) for the right to reserve hotel rooms in the new Texas A&M hotel currently being constructed on campus. Your name will appear on the door of the hotel room and you get first dibs on these premium rooms directly adjacent to the football stadium. This $100,000.00 fee is complete tax deductible, although the website does recommend you speak to a tax professional before shelling out the 100k. A couple of things to watch:

  • prices depend on the game being played (much like other hotels in the area)
  • donors must reserve the room 45 days in advance of any football game
  • hotel has a pool, 24 hour room service, sports bar, and conference center
  • the hotel is using a private/public development partner, so watch out for IRS red flags if making the deduction
  • the hotel is being paid for by private funds and NOT student funds
  • this donation does NOT count towards 12th Man priority points for sporting events

This is an interesting idea and should provide Aggies the ability to stay in luxury while they watch their team lost at home.

If you have an interest in Aggie Football and happen to have $100,000.00 burning a hole in your pocket, do I have an idea for you!

If you need help designing an Estate Plan that may or may not leave money to an Aggie hotel, please give us a call today.

Gig Em

The Weaver Firm 817.638.2022

 

Estate Planning for Entrepreneurs

Forbes published a great article showing 9 out of 10 entrepreneurs have out of date Estate Plans. What exactly is an “out of date estate plan”? Basically a plan (i.e. Wills, Power of Attorney, Living Will) that hasn’t been looked at in more than five years.

Here are five reasons to update your Estate Planning documents regularly:

  • changes in the law: tax laws change yearly
  • changes in your family: births, deaths, divorces
  • changes in where you live: did you move to Texas recently?
  • changes in your Estate: did you win the lottery or purchase a home in another state?
  • changes in your life: were you diagnosed with an illness?

Check out the article and understand that it is never too late for Estate Planning…until it is too late

h/t to Professor Beyer and his blog at http://lawprofessors.typepad.com/trusts_estates_prof/ for the article

817.638.2022 or TWeaver@www.weaverlegal.net

Is Your Child 18? 4 Tips & More To Prevent Legal Problems

Is Your Child 18? 4 Tips & More To Prevent Legal Problems

Many parents face a new experience this fall–sons and daughters headed to college, moving out, or handling adult responsibilities for the first time. Follow these four NEED TO KNOW tips to help you and your 18-year-old prevent legal problems:

1. Obtain financial & medical power of attorney for your young adult
If young Josh forgets to pay his rent one month, a financial power of attorney allows mom or dad to talk to the landlord and settle the bill—protecting your son’s credit rating. Same goes if Emma ends up with a bad case of bronchitis and can’t speak for herself at the doctor’s office. Parents can step in and determine medical care. At age 18, your child is now an adult in the eyes of the law and needs help preventing legal problems. You have no access to information or input on decisions.

2. Update student checking accounts and more with beneficiaries and co-signers
Maybe you’ll be putting monthly spending money in a checking account for Madison. Or, you’ve set up a 529 plan to pay for Jake’s tuition and books. Possibly you have a will that hasn’t been updated in years—showing your ex-wife as a beneficiary. Take 10 minutes to add yourself as co-signer on a youthful checking account and name a beneficiary. Same goes for updating beneficiaries on savings accounts and wills. You’ll then be able to access funds immediately if needed and avoid probate proceedings in Texas for these accounts.

3. Name a trustee for your estate – not your 18-year-old
Even the most mature 18-year-old doesn’t have the experience to handle decisions like selling a house, moving stock funds, and other major financial challenges if a parent is unable to do so.Update your will to name a reliable person as trustee for your estate, thereby preserving your children’s inheritance and making sure funds are spent as you intend. If you have minor children, naming a trustee for their care is even more important. Trustees can determine where your children live, apply for government benefits for your children, and speak to medical professionals. Good estate planning avoids any funds going to minors, so this won’t apply to seasoned experts like those of you reading this article.

4. What about your daughter’s dog (or cat, lizard, snake)?
If Ethan or Hannah leave Snoopy and Bootsy with you while they’re away at college, congratulations! You can always leave a small fund in a pet trust as part of your will. I also recommend naming the person or people who would take care of the pets. If you need further info on this subject, check out our article, Planning for Fur Babies.

More questions?
As always, if you have questions or would like to visit more about these tips or other estate planning concerns, I’d be glad to visit with you personally at our office just north of Fort Worth, in Rhome, Texas. Call 817.638.9016 and ask for Travis Weaver or send an email to Travis Weaver at TWeaver@WeaverLegal.net.

By Travis Weaver, Attorney – August 22, 2017

Do You Have a Family Succession Plan? The World’s Richest Woman Didn’t

Lilliane Bettencourt passed away last week and Nestle is scrambling to figure out what to do with Ms. Bettencourt’s share of the company. Seeing as Ms. Bettencourt was the world’s richest woman at the time, this share is worth billions. For those of you with family businesses, do you have a plan in case something happens to you? Is this a plan you’ve shared with your family? Come see our attorneys to create a tailored plan for your succession. Then share that plan with your family members, preferably not after a heated political discussion. Just think, you can claim you have a better estate plan than the richest woman in the world.

817.638.9016 or weaverlegal.net