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Elder Law 101

The Benefits and Risks of Gifting Your House to Your Children

As we age, one of our primary concerns is protecting our assets, including our homes. One strategy that some people consider is gifting their home to their children. While this may seem like a straightforward way to protect the value of your property and pass it on to your children, there are several important factors to consider before making such a decision.

In this article, we will explore the benefits and risks of gifting your home to your children, and what you need to know before taking this important step.

The Benefits of Gifting Your Home to Your Children

Gifting your home to your children can have several benefits, including:

Protection from creditors: By gifting your home to your children, you remove the asset from your estate, which means that it is no longer vulnerable to creditors. This can be particularly important if you are facing a lawsuit, bankruptcy, or other financial difficulties.

Reduced estate taxes: If your estate is large enough to be subject to estate taxes, gifting your home to your children can help reduce the tax burden on your estate. This is because the value of the home is no longer part of your estate, and therefore not subject to estate taxes.

Simplified probate: Probate is the legal process that occurs after someone dies to distribute their assets. If you gift your home to your children, it can simplify the probate process, as the property will already be in their name.

The Risks of Gifting Your Home to Your Children

While there are benefits to gifting your home to your children, there are also some significant risks to consider, including:

Loss of control: Once you gift your home to your children, you no longer have control over the property. This means that you cannot sell it, mortgage it, or make any other decisions about the property without the permission of your children.

Tax consequences for your children: If your children sell the property, they may be subject to capital gains taxes on the increase in value from the time you gifted it to them. This can be a significant financial burden for your children.

Medicaid eligibility: If you need to qualify for Medicaid to pay for long-term care, gifting your home to your children can impact your eligibility. Medicaid has a five-year “look-back” period, which means that any gifts made within five years of applying for Medicaid can impact your eligibility.

What You Need to Know Before Gifting Your Home to Your Children

If you are considering gifting your home to your children, it is important to work with an experienced elder law attorney who can help you understand the legal and financial implications of this decision. Some key factors to consider include:

Your overall estate plan: Gifting your home is just one aspect of your overall estate plan. Your attorney can help you understand how this decision fits into your broader goals for your assets and your family.

Your tax situation: Gifting your home can impact your tax situation, both in terms of estate taxes and income taxes. Your attorney can help you understand the tax implications of this decision.

Your children’s financial situation: Before gifting your home to your children, it is important to consider their financial situation and how this decision may impact them. This includes considering the tax consequences and the potential loss of control over the property.

In Conclusion

Gifting your home to your children can be a useful strategy for protecting your assets and passing them on to the next generation. However, there are also significant risks to consider, and it is important to work with an experienced elder law attorney to understand the legal and financial implications of this decision.

Contact Beasley & Ferber for Assistance

At Beasley & Ferber, we have over 60 years of combined experience in estate planning. For more information about estate planning and to get started with an estate attorney in New Hampshire today, please contact Beasley & Ferber today.

Is a "No-Contest" Provision in a Will Enforceable?

A no-contest provision in a will or trust prevents you, if you are a beneficiary, from challenging the will simply because you believe it is not fair, and you should have gotten more of the decedent’s assets than what the decedent left to you.

When there is a no-contest clause, if you challenge the will or trust and lose, you will get nothing unless the no-contest clause allows you to receive a lesser amount if you contest the will.

Enforceability of a No-Contest Clause

A no-contest provision will be enforced according to the express terms as it is articulated in the will or trust document. There are two separate New Hampshire statutes, one applying to such clauses in a trust document, and another applying to such clauses in a will.

The statutes are nearly identical in their enforceability and non-enforceability of a no-contest clause. Massachusetts law concerning no-contest provisions in wills and trusts is almost identical to New Hampshire’s.

It won’t matter whether your challenge is made in good faith, or if you believe you have probable cause for the challenge. If the will or trust documents are valid, the no-contest clause will be enforced exactly as it is written.

Unenforceability of a No-Contest Clause

If you can prove any of the following, the no-contest clause will not be enforced:

  • The will or trust is invalid because it was written due to fraud, duress, or undue influence.
  • The testator (one who wrote the documents) lacked testamentary capacity. Meaning that person was not of sound mind at the time the documents were written, or that person was under the age of 18 when the documents were written.
  • The trustee, or any other fiduciary, has breached their fiduciary duty.
  • If you join in any action brought by the trustee or other fiduciary, as long as that person is not the beneficiary named in the no-contest provision, you will not be penalized.
  • If you join with all beneficiaries and agree to settle any other matter relevant to the trust or will.
  • You make a motion, or there is any proceeding to determine whether if you take the action you are considering taking, will that action constitute a contest within the meaning of the no-contest provision.
  • You bring an action for interpretation of the trust or will.

There may be other situations where a challenge to the documents may be allowed even under the no-contest provision. If you are considering challenging a will or trust that has a no-contest provision, you need to first consult with experienced estate planning attorneys at Beasley and Ferber who will help you understand what you are risking if you decide to make that challenge.

Contact Beasley & Ferber for Assistance

You should also make an appointment with us at Beasley & Ferber if you want to include a no-contest provision in your will or trust. We are here to help and will discuss with you the benefits of including such a provision in your estate planning documents.

If you determine such a clause is needed, we will draft your documents for you so that your will and trust will be free from challenges and your wishes will be carried out as articulated in your estate planning documents.

When Your Beneficiary is a Non-Profit or Other Entity

There are many reasons why a person may choose a non-profit, educational institution, or other entity as their beneficiary instead of a person. They can leave a portion of their estate to the entity or they can leave their entire estate. They may not have family, the family may already be well off, or they could be estranged from their family.

Whatever the case, you are perfectly within your rights if that is what you choose to do. Here’s what you need to know.

What are the Types of Beneficiaries?

There are several types of beneficiaries that you can consider, your spouse, friends, family, a charity, a university, or even the government which after your death would be estate taxes.

When you are considering what will happen to your estate after you pass on, you will have to look at this. Planning your estate thoughtfully will allow you to assess your assets as well as potential beneficiaries and decide if you will divide it into portions for other beneficiaries, or if the bulk of it will go to the entity.

What is an Entity Beneficiary?

While the beneficiary is legally designated to receive the benefits that you allocate from any financial products that you name, the type of beneficiary can be either a person or an entity.

In a will, an entity is an individual, a single organization, a group, a trust, a corporation, or an organization. So when you are planning how your estate will be divided and disbursed, you need to keep in mind that you must be as specific as possible because the language can be ambiguous. If you want all or part of your estate to go to a certain non-profit, then name that non-profit. Be very specific.

Can a Non-Profit Beneficiary be Contested by Your Family?

Your spouse and children may try to challenge your trust or will because they do not want that portion of your estate to go to the beneficiary. This can create problems by slowing the probate process. The challenges can create difficulty in ending it, causing it to drag on and on.

They may challenge it because it affects the portion that they receive and they may feel that it is rightfully theirs. However, these challenges do not get overturned often because it was the person’s expressed request.

How do You Name a Charity as Your Beneficiary?

There are three steps to naming a charity beneficiary. It is not a difficult or drawn process at all.

  1. Decide on the charity or cause that you wish to support
  2. Decide the type and/or amount of gift that you want to make
  3. Include the gift with the charity expressly named in your Estate Plan

It’s really that easy.

There is one more step though that while it is not required, it is recommended. Talk to your family and friends. Make sure that they understand what you are doing and are on board. This should minimize the possibility of anyone challenging your gift once you pass.

Contact Beasley & Ferber for Assistance

If you are ready to begin your own estate planning and would like to include a charity or non-profit as a beneficiary, let us help. At Beasley & Ferber we have the knowledge and experience to make estate planning quick and easy. Call today and schedule an appointment and get started.

When an Elderly Parent Wants to Live Alone

According to a recent article in Forbes, more than 90 percent of elderly people who were surveyed express the intent to remain living in their own homes as they age and are committed to never moving. This is true even if it means living alone after a divorce or the death of a spouse. Unfortunately, that is not always possible.

Signs Your Parent Should No Longer Live Alone

There comes a time when no matter how much your elderly parent wants to remain living alone, it is no longer feasible for them to do so. A few signs that they need help are:

  • They exhibit personality changes such as getting angry easily, or being withdrawn and silent or lashing out.
  • Forgetting to take their medications.
  • They have trouble paying their bills.
  • They neglect their personal care demonstrated by not brushing their hair, not getting dressed appropriately, and forgetting things like eating.
  • They can no longer use their computer and have trouble even with their phone.

If this is happening to your elderly parent, it is time to have a serious discussion with them about making a change.

Tips on How to Discuss Living Options with Your Elderly Parent

It is not easy to talk to your parent about making a change in their living environment when they belligerently refuse to move from their home and give up living alone. SeniorSafetyAdvice, an online information resource for seniors and their caregivers, offers some suggestions for discussing this touchy subject with your loved one:

  • Listen to your parent’s point of view. Treat them like an adult. Do not talk down to them as though they are children. Understand why they are so resistant. Are they simply afraid to move and fear they will be giving up control of their life? Give them time to consider your suggestions.
  • Give your parent a sense of control over deciding how the family will cope with the changes that need to be made. Don’t argue with them but be firm and calm. If possible, give them choices. For example, do they need grocery delivery, meals-on-wheels, or an in-home health aid? Do they need an assisted-living environment?
  • If they can be convinced to do so, include them in the research about what to do next. Will they need to move or is it more feasible to have a caregiver move in with them?
  • If moving seems like the only option, focus on the type of place that will meet their needs, not a place that you think would be wonderful for you if you were in their situation.
  • Be firm about discussing with them the potential consequences of them continuing to live alone.

Contact Beasley & Ferber for Assistance

After you’ve had your thoughtful discussion with your loved one, make an appointment with Beasley & Ferber. We are here to help with all things related to elder law and will discuss with you options for care for your elderly parent who can’t or should no longer live alone.

Long-term Care Planning: Medicare, Medicaid, and Insurance

Long-term care is something that people generally aren’t eager to think about. However, roughly 7 out of 10 people will require long-term care at some point during their lifetime. When the national average cost of a private room in a nursing facility is $9,034, older adults and families need to address long-term care in their financial and legal planning.

Long-term care is a general term that describes various care services that regular health insurance does not cover. It might include things like:

  • In-home assistance with routine daily activities (activities of daily living or ADLs)
  • Living in a nursing home or assisted living facility
  • Nursing care
  • Physical, occupational, or speech therapy

Because long-term care is not covered by health insurance, you need to make other plans to pay for it.

Does Medicare Cover Long-Term Care?

Medicare is a government-provided health insurance program for adults who are over the age of 65. It also covers some individuals with disabilities as well. Unlike Medicaid, Medicare does not depend on your income, assets, or disability status.

Adults who qualify pay for Medicare just as they would a private health insurance company. The main difference is that Medicare provides more extensive services and lower fees compared to the average private insurance company. In many cases, those receiving Medicare do not pay any insurance premiums at all for Medicare Part A, which provides hospital services.

Medicare Part A covers things like:

  • Care in a skilled nursing facility
  • Hospital stays
  • Hospice care
  • Some home healthcare

It does not cover more basic things that medical insurance might cover, such as doctors’ services, medical supplies, and preventive services.

Medicare also does not cover long-term care, including living in an assisted living facility or nursing home.

As a result, individuals and families cannot rely on Medicare to pay for the full cost of a nursing home or assisted living care. Instead, they need to make other arrangements to pay for long-term care.

Does Medicaid Cover Long-Term Care?

Medicaid might be an option to pay for long-term care in some situations. However, using it appropriately might require some long-term planning. In most circumstances, you will need at least five years to appropriately plan to use Medicaid for long-term care. Learn more about Medicaid planning by downloading our free e-book.

Long-Term Care Insurance

Neither regular health insurance nor Medicare addresses long-term care. So, how can individuals and families pay for long-term care? Long-term care insurance might be a good option.

Long-term care insurance is available from many private insurance companies. It generally covers expenses that Medicare will not cover. If you buy a policy under the age of 55, it is often more affordable than waiting until you are older.

Get Help with Long-Term Care Planning

You might also be able to tap into other resources to pay for long-term care, such as using investments or Veterans’ benefits. However, you need to have a full understanding of your options to plan appropriately.

Get help with long-term planning from the experienced elder law attorneys at Beasley & Ferber. We can help you review your options and make recommendations for your unique situation. Contact us today for more information.

Why It's Important to Have an Elder Professionally Diagnosed for Suspected Dementia

Dementia and, in particular Alzheimer’s Disease, get a lot of attention in the media. So much so, that when an elderly loved one starts to exhibit memory loss, dementia is the first thing that occurs to family members and close friends. This can be a misleading and dangerous thing to assume for many reasons. First, no one should be casually diagnosed with a medical condition without professional input. Second, it’s unfair to a person to be categorized with a condition when no such professional diagnosis has been made.

Important Differences Between Dementia and Age-Related Memory Loss

There are distinguishable differences between dementia and simple age-related memory loss that need to be understood. Dementia is a physical symptom of a physical condition. Alzheimer’s is just one disease that has dementia as its most prevalent symptom. Dementia is a disabling condition that progresses and worsens over time, often to the point where a person forgets who they are or who their family members are.

Age-related memory loss is something that happens to almost everyone over a long enough period of time. It is typically minor and not debilitating. People with age-related memory loss may repeat themselves, or forget why they came into a room, but they can usually still take care of themselves and recall earlier life events.

Dangers of Casually Diagnosing a Person With Dementia

When a person is casually diagnosed with dementia without having received a professional diagnosis, all sorts of estate planning problems can occur. The first one is the assumption that the person is not able to make sound choices about their estate. Later on, once the estate plan has been documented and executed, the person may balk at certain aspects that don’t align with their true wishes. Not only does this lead to family discord, but it also necessitates beginning the entire legal process over again, which is timely and costly.

Why a Professional Diagnosis is Essential

Establishing diminished mental ability is essential before a family member or anyone else can legally make decisions on behalf of someone else. In most cases, a court order is also needed. There is a great deal of grey area around estate planning for those with dementia, and that grey area is even bigger if a person attempts it without first having a professional diagnosis. If the professional diagnosis comes back with unexpected results, the plan could be negated. If the diagnosis affirms the suspected dementia, then the estate plan needs to be organized in such a way as to accommodate the expected increased needs of the dementia patient. Either way, it’s not just prudent to get the professional diagnosis first; it’s essential.

The very fact that family members are concerned about a loved one’s mental state is often a good sign that they have that person’s welfare in the right perspective. Working with an established elder law attorney in New Hampshire can help to ensure that the loved one’s estate is properly planned. Contact Beasley & Ferber today for more information.

Who Should be Involved in Estate Planning Discussions?

Estate planning is one of the best things you can do for your family and heirs. The tremendous burden of loss after a loved one passes is hard enough without having to sift through the complex and disorganized financial affairs of the diseased. Organizing and arranging for the estate begins with open and honest discussion. But who should be involved in these discussions? Their very nature entails a level of transparency that is not appropriate for everyone to be privy to.

The Primary Individual(s)

Any discussions about the financial affairs of an individual or couple need to include that individual. This seems obvious, there have been instances where children or siblings try to initiate plans on behalf of parents or elders without even notifying them. If an elder has been professionally diagnosed as mentally unsound, that’s another story. But otherwise, the primary individual should always be present for such conversations.

Estate Planning Attorney

Once decisions have been made among stakeholders, the next person to bring in on estate planning discussions is an estate planning attorney. This attorney can review the intended plans, make suggestions and determine if the requested plans are possible, and how they could be put into place. The experience of an estate planning lawyer is of the highest value since they are aware of the best strategies to avoid possible complications or issues after the loved one has passed. Bring in the estate planning attorney as soon as possible after choices have been made among family members, so there is the least possible delay between the decision-making to the drawing up and execution of necessary legal documents. Ideally, all the relevant parties should meet together as a group with the estate planning lawyer so that any questions can be cleared up and everyone is on the same page.

Executor of the Estate

The executor of the estate must be privy to all discussions pertaining to the estate plan; ideally from the very first conversation. If you trust the executor enough to name them as such, then you must trust them with many of the private financial facts of the estate. While it’s not necessary to go into every detail, the goal is to make sure that the executor is comfortable with their role and the actions that role will entail.

Primary Beneficiary(ies)

Unlike in the movies, it’s not a good idea to spring a surprise on your primary beneficiary or group of main beneficiaries. Just as you want to plan your financial future, you should respect that your beneficiaries would like to know what’s ahead for them. For instance, if you plan to leave equal shares of your estate to multiple children, letting them in on that information and discussions will help them to anticipate and plan accordingly.

Note that it’s not necessary to bring in other, minor beneficiaries to estate planning discussions. The parties mentioned above are the key stakeholders and are the ones who have a definite need to be privy to these conversations. For more information about estate planning and to get started with an estate attorney in New Hampshire today, please contact Beasley & Ferber today.

Strategies to Protect Your Inheritance From Divorce

No one plans on getting divorced and it’s easy to be complacent about protecting your assets before marriage. Unfortunately, divorce is a sad reality of modern life, and you need to be proactive about making sure you get to keep what’s rightfully yours after divorce. There are many complexities involved with how assets are divided up in a divorce, which is why you should seek the advice of an estate planning attorney such as Beasley & Ferber. In the meantime, here are some strategies to know about that can help protect your inheritance from divorce.

Avoid Commingling Inheritance

Many couples consider it a sign of trust to have joint accounts and to have the attitude of, “what’s mine is yours.” In general, that’s an admirable and generous way of looking at things. However, when it comes to inherited assets, the smart thing to do is to avoid commingling. Commingling is when you mix up assets in joint accounts, pay a credit card bill from a mix of a marital asset account and an inherited asset account, deposit a marital asset check into an inherited asset account, or vice versa, and more. There are many “accidental” ways to commingle marital assets with inherited assets. The best way to avoid doing it is to consult with an attorney who specializes in these matters.

Have the Prenup Drawn Up This Way

When you meet with your estate planning attorney, have a prenup drawn up. Ask that the prenup specifically exclude your inherited assets against any possible future divorce. You may be able to have language in the prenup that specifies existing or future inheritance. This might be helpful in the event that you anticipate receiving an inheritance anytime after your wedding date.

Save All Documentation

Make sure that you save all documentation relating to your inheritance. This includes things like wills, trust paperwork, buys and sells, investment statements, bank statements, etc. When relevant and possible, keep the originals instead of converting them into digital files. In the event that your inherited assets are disputed during a divorce, the originals will bear more weight.

Establish a Special Trust

To protect and preserve your inheritance, create a trust. Because they are a great tool to protect assets, trusts are often utilized in estate planning. You may be confident that your inheritance will stay separate from your marital assets by putting it into a special trust. You and your estate planning attorney should set up the trust so it names yourself or your children as the beneficiary, rather than your spouse.

Whether this is your first marriage, second, or even third, it pays to give extra attention to protecting your inherited assets from a divorcing spouse. Remember, if you choose to do so, you can always concede assets as part of your divorce decree. However, using these strategies makes the decision yours and not the right of an estranged spouse. For assistance protecting your inheritance from divorce, contact Beasley & Ferber, expert estate planning attorneys in Massachusetts and New Hampshire.

 

What is a Durable Power of Attorney?

As you work with an estate planning attorney, you may come across the term, “durable power of attorney.” This term is often interchanged with the term, “power of attorney.” Both refer to giving permission to another person or entity to make important decisions on your behalf, but there are important distinctions between the two. As a party working on a responsible and reasonable estate plan, it’s essential that you understand all the aspects of a durable power of attorney.

What a Power of Attorney Actually Is

A durable power of attorney is a physical legal document. Your estate planning attorney will draw up the Durable Power of Attorney document in accordance with your wishes. The name is a little misleading because the power to make decisions needn’t go to an actual attorney. The power can be given to a trusted family member or trusted family friend. In some cases, the power is given to the actual estate planning attorney. However, in all cases, the “agent,” or the person receiving the durable power, must be an adult over the age of 18 years old at the time the document is drawn up.

How Does a Durable Power of Attorney Differ From Power of Attorney?

A Durable Power of Attorney is a subtype of a Power of Attorney, with one very important caveat. The Durable Power of Attorney covers instances where the individual has become temporarily or permanently incapacitated from injury, accident, or illness, either physically or mentally. This means that even if a person becomes incapable of making sound, rational decisions for themselves, the individual named in the Durable Power of Attorney has full legal recourse to make those decisions on behalf of the incapacitated person. As you can see, whom you choose for your Durable Power of Attorney is extremely vital.

What Kinds of Decisions are Included in a Durable Power of Attorney?

There are different kinds of Durable Power of Attorney documents. The kinds of decisions covered determine the type of Durable Power of Attorney. Your estate planning attorney can draw up paperwork covering decisions related to healthcare, finances, care for dependents, and more. Items may include:

  • selling, buying, and managing estate assets
  • control over banking and investment accounts
  • filing tax returns
  • applying for benefits such as Medicaid, Medicare, etc.
  • arranging home health care, hospice care, palliative care, etc.
  • choosing healthcare providers
  • making decisions related to life support, resuscitation, etc.

Benefits of Having a Durable Power of Attorney in Place

Many families and individuals seek out an estate planning attorney to get a Durable Power of Attorney drawn up. The benefits of having this document include having a third party ready to make important, possible life-saving decisions for an individual who can’t make them. With a Durable Power of Attorney, private decisions can be kept out of a courtroom, where a judge would make those decisions instead.

If you have a family member who may be incapacitated or you simply want an extra layer of protection for your family members, contact Beasley & Ferber today.

5 Signs of Elder Abuse to Watch For

When you put your elderly loved one in the care of a facility, you expect them to be looked after. But one in 10 people aged 60 and over in the U.S. has experienced some type of elder abuse, according to the National Council on Aging. You can help your loved one by paying attention to the following five telltale signs.

1. Becoming Unusually Quiet

During visits with your elderly loved one, do they become unusually quiet when a caregiver enters the room? Often, an elderly person will react instinctively when they are afraid of someone. This may include suddenly stopping in the middle of a sentence, or refusing to answer your questions when an abusive caregiver is present. When that person has left, your loved one may become their usual chatty self.

2. Unwarranted Anger

Often, the elderly will lay blame for abuse on their loved one’s shoulders, especially if they feel that it’s this person’s “fault” they are there in the first place. If you sense unwarranted hostility during visits, don’t assume it’s just because of old age or senility. It could be that they are reacting to feelings of anger and frustration over being treated poorly by those who are supposed to be caring for them.

3. Sudden Decline in Health

Elder abuse doesn’t always take the form of physical or verbal abuse. It can also come in a more passive form of withholding care. This sometimes means that an elderly person isn’t given their medications or isn’t given them on the correct schedule. If you notice a sudden or progressive decline in health, don’t accept it at face value. It could be that their doctor’s orders aren’t being followed. Any deterioration in health should be followed up with a visit to your elderly loved one’s personal physician—not just the care facility’s doctor. An independent assessment by a doctor who is not associated with the care facility can determine whether a lack of care and/or medication might be the cause.

4. Uncleanliness in the Room

When you visit, pay attention to the condition of the room and the things that your loved one uses. Are the sheets and pillowcases clean? Is there clean water within reach? Is the room tidy? Is the toilet clean? If the care facility isn’t taking care of the physical room, it’s likely that they aren’t taking care of your loved one, either.

5. Lack of Eye Contact

When elder abuse is happening in a care facility, human nature often means that the staff will be hesitant to make eye contact with visiting relatives. It’s the inside guilt that makes this phenomenon happen. A lack of eye contact can mean nothing, or it can mean that they have something to hide.

When trying to determine if elder abuse is happening, consider a group of signs, not just one. One sign might just be an oversight, but if you notice multiple signs, it’s worth consulting with an elder law attorney to determine the best steps to take. Contact Beasley & Ferber for help.

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