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Monday, February 03, 2014

8 Things to Consider When Selecting a Caregiver for Your Senior Parent

8 Things to Consider When Selecting a Caregiver for Your Senior Parent

As a child of a senior citizen, you are faced with many choices in helping to care for your parent. You want the very best care for your mother or father, but you also have to take into consideration your personal needs, family obligations and finances.

When choosing a caregiver for a loved one, there are a number of things to take into consideration.

  1. Time. Do you require part- or full-time care for your parent? Are you looking for a caregiver to come into your home? Will your parent live with the caregiver or will you put your parent into a senior care facility? According to the National Alliance for Caregiving, 58 percent of care recipients live in their own home and 20 percent live with the caregiver. You should consider your current arrangement but also take time to identify some alternatives in the event that the requirements of care should change in the future.
  2. Family ties. If you have siblings, they probably want to be involved in the decision of your parent’s care. If you have a sibling who lives far away, sharing in the care responsibilities or decision-making process may prove to be a challenge. It’s important that you open up the lines of communication with your parents and your siblings so everyone is aware and in agreement about the best course of care.
  3. Specialized care. Some caregivers and care facilities specialize in specific conditions or treatments. For instance, there are special residences for those with Alzheimer’s and others for those suffering from various types of cancer. If your parent suffers from a disease or physical ailment, you may want to take this into consideration during the selection process
  4. Social interaction. Many seniors fear that caregivers or care facilities will be isolating, limiting their social interaction with friends and loved ones. It’s important to keep this in mind throughout the process and identify the activities that he or she may enjoy such as playing games, exercising or cooking. Make sure to inquire about the caregiver’s ability to allow social interaction. Someone who is able to accommodate your parent’s individual preferences or cultural activities will likely be a better fit for your mother or father.
  5. Credentials. Obviously, it is important to make sure that the person or team who cares for your parent has the required credentials. Run background checks and look at facility reviews to ensure you are dealing with licensed, accredited individuals. You may choose to run an independent background check or check references for added peace of mind.
  6. Scope of care. If you are looking for a live-in caregiver, that person is responsible for more than just keeping an eye on your mother or father—he or she may be responsible for preparing meals, distributing medication, transporting your parent, or managing the home. Facilities typically have multidisciplinary personnel to care for residents, but an individual will likely need to complete a variety of tasks and have a broad skill set to do it all.
  7. Money.Talk to your parent about the financial arrangements that he or she may have in place. If this isn’t an option, you will likely need to discuss the options with your siblings or your parent’s lawyer—or check your mother’s or father’s estate plan—to find out more about available assets and how to make financial choices pertaining to your parent’s care.
  8. Prepare. Upon meeting the prospective caregiver or visiting a facility, it is important to have questions prepared ahead of time so you can gather all of the information necessary to make an informed choice. Finally, be prepared to listen to your parent’s concerns or observations so you can consider their input in the decision. If he or she is able, they will likely want to make the choice themselves.

Choosing a caregiver for your parent is an important decision that weighs heavily on most adult children but with the right planning and guidance, you can make the best choice for your family. Once you find the right person, make sure to follow up as care continues and to check in with your mother or father to ensure the caregiver is the perfect fit.

 


Monday, December 02, 2013

14 Costly Misconceptions About Planning for Your Senior Years

A Minneapolis Estate Planning and Probate Lawyer Discusses Estate Planning Issues Specific to Seniors

Misconception #1: Most seniors move into nursing homes as a result of minor physical ailments that make it hard for them to get around.  Wrong!  A large percentage of admissions to nursing homes is because of serious health, behavior, and safety issues caused by Alzheimer’s disease and dementia.

Misconception #2: Nursing home costs in Minnesota average $1,500 to $2,500 per month per person.  Hardly.  Current nursing home charges for one resident typically run $6,000 per month, or $72,000 per year, which does not include prescription drugs -- and those costs continue to rise.

Misconception #3: Children can care for a parent with Alzheimer’s disease at home, without the need for nursing home care.  Not true!  Many patients with Alzheimer’s disease end up in nursing homes because children are simply unable to provide the level of care their parent needs.  In most cases, the children want to care for their parents.  But, as a practical matter, they simply can’t.  Moving a parent into a nursing home is an intensely personal issue and should not be labeled as a right or wrong decision. In many cases, it’s the only realistic option.  The rare exception is when the family has enough money to pay for skilled nursing care at home.

Misconception #4: Standard legal forms are all you need for a good estate plan.  Not true.  A competent estate plan begins with clearly defined goals, supported by well-drafted legal documents, and the repositioning of assets, as needed, to protect your estate from taxes, probate costs, and catastrophic nursing home costs. But you MUST PLAN EARLY.

Misconception #5: Your child will never move you into a nursing home.  Wrong.  Most children consider all options before moving a parent into a nursing home.  But, sadly, children usually find they have no other alternative.  As a result, parents who never expected to live in a nursing home soon discover that a nursing home is the only place with the staff and equipment to provide the care they need.

Misconception #6: As payment for nursing home care, the government will take your family home.  Not true, if you plan ahead.  Many people fear that the government will take their home in exchange for nursing home care, but you can avoid this with proper planning.  You’ll be glad to know there are some ways you can protect your home so it won’t be taken.

Misconception #7: You will never end up in a nursing home.  That’s hard to predict.  Your odds are roughly 50/50.  Of Americans reaching age 65 in any year, nearly half will spend some time in a nursing home.  And a surprising number will require care for longer than one year.  That means every year, tens of thousands of seniors will face costs of $48,000 or more ($60,000 in Minnesota), which does not include the cost of prescription drugs.

Misconception #8: If your spouse enters a nursing home, all of your joint savings will have to be spent on his or her care.  No.  With proper planning you can keep half of your combined “countable” assets up to approximately $103,000 (increasing each year).  In some circumstances, you may be able to protect nearly all of your life savings.  In fact, it is often possible to protect much more than the $103,000 maximum.  “Countable” assets are those assets such as cash, checking accounts, savings, CDs, stocks, and bonds that the government considers available to be spent on the cost of nursing home care.

Misconception #9: Legally, you can give away only $14,000 to each of your children each year.  Not true.  You can give away any amount, but you have to report to the IRS gifts in excess of $14,000 per recipient per year ($28,000 if both husband and wife make a gift).  However, there is no requirement that you pay any gift tax unless you have exhausted your lifetime exclusion amount, which is currently set at $2,000,000 for an individual. But, there is a "look back" period so you must work with a qualified attorney before gifting away any assets as you age.

Misconception #10: You can wait to do long-term planning until your spouse or you get sick.  Yes, to some degree.  However, you and your spouse will be much better off if you have taken important planning steps in advance, before a crisis occurs.  What stops most people from being able to effectively plan when they are in the middle of a crisis is that the ill person is unable to make decisions and sign the necessary legal documents.

Misconception #11: All General Durable Powers of Attorney are created equal.  Completely false!  A General Durable Power of Attorney is a highly customized legal document -- and NOT a form!  Most Durable Powers of Attorney don’t contain even the most basic gifting authority.  Without a gifting power, your agent is usually limited to spending your money on your bills and selling your assets to generate cash to pay your bills.  Some Durable Powers of Attorney contain a gifting provision, but the Minnesota Statutory Power of Attorney it is limited to $10,000 per year.  This is particularly concerning for unmarried couples as the IRS considers ANY exchange of money/assets between them to be a gift.  The annual limit of $10,000 is too small for effective asset protection planning, and relates to a completely different type of federal estate and gift tax issue.  Unique Estate Law has created an enhanced power of attorney to get around that limit.

Misconception #12: Since you are married, your spouse will be able to manage your property and make financial decisions without a general durable power of attorney.  Not true.  If you become incapacitated and your spouse needs to sell or mortgage the family home -- or gain access to financial ac-counts that are in your name only -- your spouse will need a general durable power of attorney.  Without one, your spouse will have to go to Court and get the judge’s permission to act on your behalf by way of a conservatorship proceeding.

Misconception #13: You can hide your assets while you become eligible for Medicaid (Known as Medical Assistance in Minnesota).  False!  Intentional misrepresentation in a Medicaid application is a crime and can be costly.  The IRS shares any information concerning your income or assets with the local Medicaid eligibility office.  You -- or who-ever applied for Medicaid -- may have to repay Medicaid to avoid prosecution.

Misconception #14: Medicaid rules that applied to your neighbor when he went into a nursing home will also apply to you.  Maybe not.  Medicaid rules change.  Don’t assume the law that applied to your neighbor will also apply to you.  In addition, there may have been facts about your neighbor’s situation that you just don’t know.


Monday, October 14, 2013

Helping the Family Prepare for Loved Ones in Advancing Age

Advance Planning Can Help Relieve the Worries of Alzheimer’s Disease

The “ostrich syndrome” is part of human nature; it’s unpleasant to observe that which frightens us.  However, pulling our heads from the sand and making preparations for frightening possibilities can provide significant emotional and psychological relief from fear.

When it comes to Alzheimer’s disease and other forms of dementia, more Americans fear being unable to care for themselves and burdening others with their care than they fear the actual loss of memory.  This data comes from an October 2012 study by Home Instead Senior Care, in which 68 percent of 1,200 survey respondents ranked fear of incapacity higher than the fear of lost memories (32 percent).

Advance planning for incapacity is a legal process that can lessen the fear that you may become a burden to your loved ones later in life.

What is advance planning for incapacity?

Under the American legal system, competent adults can make their own legally binding arrangements for future health care and financial decisions.  Adults can also take steps to organize their finances to increase their likelihood of eligibility for federal aid programs in the event they become incapacitated due to Alzheimer’s disease or other forms of dementia.

The individual components of advance incapacity planning interconnect with one another, and most experts recommend seeking advice from a qualified estate planning or elder law attorney.

What are the steps of advance planning for incapacity?

Depending on your unique circumstances, planning for incapacity may include additional steps beyond those listed below.  This is one of the reasons experts recommend consulting a knowledgeable elder law lawyer with experience in your state.
 

  1. Write a health care directive, or living will.  Your living will describes your preferences regarding end of life care, resuscitation, and hospice care.  After you have written and signed the directive, make sure to file copies with your health care providers.
     
  2. Write a health care power of attorney.  A health care power of attorney form designates another person to make health care decisions on your behalf should you become incapacitated and unable to make decisions for yourself.  You may be able to designate your health care power of attorney in your health care directive document, or you may need to complete a separate form.  File copies of this form with your doctors and hospitals, and give a copy to the person or persons whom you have designated.
     
  3. Write a financial power of attorney.  Like a health care power of attorney, a financial power of attorney assigns another person the right to make financial decisions on your behalf in the event of incapacity.  The power of attorney can be temporary or permanent, depending on your wishes.  File copies of this form with all your financial institutions and give copies to the people you designate to act on your behalf.
     
  4. Plan in advance for Medicaid eligibility.  Long-term care payment assistance is among the most important Medicaid benefits.  To qualify for Medicaid, you must have limited assets.  To reduce the likelihood of ineligibility, you can use certain legal procedures, like trusts, to distribute your assets in a way that they will not interfere with your eligibility.  The elder law attorney you consult with regarding Medicaid eligibility planning can also advise you on Medicaid copayment planning and Medicaid estate recovery planning.

Sunday, March 03, 2013

Estate Planning for Gay Familes, Part I: The 4 Essential Documents

Minnesota Lawyer Lists the Critical Documents Every Same-Sex Couple Must Have.

Under current Minnesota (and Federal) law, gay couples do not have any rights to such basic things as: 1) inheriting from each other; 2) making medical decisions for each other; 3) handling financial matters for each other; 4) naming a guardian for a minor child; or 5) continuing to live in the family home if only one partner is listed on the deed.
 

  1.  Will – A will tells who should inherit your property when you pass away, who you want your executor to be, and who will become guardians of any minor children. These issues are all especially important for unmarried individuals. In most states, an unmarried partner does not have inheritance rights, so any property owned by his or her deceased partner would go to other family members. Also, in the case of many gay and lesbian couples, the living partner is not necessarily the biological or adoptive parent of any minor children, which could lead to custody disputes in an already very difficult time.  Therefore, it’s critical to nominate guardians for minor children.
     
  2. Financial power of attorney – A power of attorney (for financial matters) dictates who is authorized to manage your financial affairs in the event you become incapacitated. Otherwise, it can be very difficult or impossible for the non-disabled partner to manage the disabled partner’s affairs without going through a lengthy guardianship or conservatorship proceeding.
     
  3. Advance healthcare directive – A power of attorney for healthcare, informs caregivers as to who is responsible for making healthcare decisions for someone in the event that a person cannot make them for himself, such as in the event of a serious accident or a condition like dementia.
  4. HIPAA Waiver - allows the persons named to discuss your care with a doctor BUT not to make decisions.

If you don't have these documents, your partner may be prohibited from keeping your assets, living in your home, paying your bills, or making your medical decisions.

Call now to protect your family!


Wednesday, February 20, 2013

Estate Planning Lessons, Part 2: Marriage Is Not Enough - You Must Get a Financial Power of Attorney Now

This continues my series on lessons I learned in handling the estates of my parents who both passed away last year. This post will discuss reasons why you should plan things now - do not wait!

I am an estate planning attorney with the knowledge and experience to handle complex issues but found myself running around at the last minute to take care of things for my own father. It turns out that my father had never signed a financial power of attorney.  What does that mean? It means that his wife was unable to handle simple financial transactions on his behalf while he was in the hospital and unable to do things like go to the bank. But they're married you say. For many financial matters, even a spouse does not have the right to act on your behalf. For instance, a spouse may not deal with anything listed solely in your name. This generally includes such things as your retirmenet plan, stocks or bank accounts. 

So, on a Thursday afternoon I was in my office (instead of the hospital) drafting a power of attorney for him to sign so that his wife could take care of some financial matters he thought were crucial in his last few days of life. Then I ran it to the hospital and got it signed and notarized.

You could look at this and note that we were lucky as he was awake, competent and alert enough to know what he wanted done and still capable of signing the Power of Attorney - even one day later and that would not have been the case. Many people simply put it off unti it's too late and the family has to fight to get a conservatorship to be allowed to make decisions they know the loved one would have wanted.

Please plan now so no one is running around trying to get these things done during such a difficult time.


Friday, December 28, 2012

Unique Estate Law: 2012 Wrap Up for a Nontraditional Law Firm

An Estate Planning Attorney Provides a Personal Review of 2012

The state of the firm

For Unique Estate Law 2012 was a fantastic year. The firm beat projections and I was able to assist more clients than ever before. I had referrals from a wide range of sources and a constant stream of clients coming through my website. I’ve done well enough to start advertising on a local radio station and in a local magazine. I have met many wonderful people and have given them guidance and peace of mind when facing an uncertain future.

Two major losses

But, for Chris Tymchuck, it was the worst year of my life.

Why was it such a bad year personally? In November both my Dad and Mom died within a week of each other. They were 66 and 64 respectively so it hadn’t occurred to the family that they might be gone so soon. While my father had battled cancer for 11 years he was in no worse shape in the end than in prior battles. And my Mom had never been sick a day in her life.

Why am I writing about this?

Why do I share such personal information on a law firm website? Because, it is a cautionary tale of what happens in a blended family when little or no preparation is done.

I was recently sharing my story with two clients and they said, “I can’t believe this is happening to you who spend your time making sure that people like us are ok and covered. You have to share your story with people so they understand that this can, and does, happen.” And they’re right.

I write this blog to assist clients and colleagues with things to consider when drafting estate plans for all types of families – both traditional and non-traditional – and the blog has paid off for me. I feel that, in keeping with the spirit in which I write I must use the lessons of 2012 to further education clients and colleagues through this medium. In short, to give back as the blog has given me so much.

Is it relevant to Unique Estate Law?

Why is my story relevant to this site? Because part of the reason that I specialize in non-traditional families is because I grew up in one – or several – and know the complications that come with being raised with in a complex web of interrelated (and sometimes not) people.

My parents divorced and each remarried and had kids with a subsequent spouse. In addition, my Mom remarried a third time and became a stepparent herself. So, that means I have a stepdad, stepmom, 3 half-brothers, a half-sister, a step brother and a step sister. That, of course, doesn’t include the “traditional” family members such as aunts, uncles and still-living grandparents. There are a lot of people to factor into planning, mourning and administering for someone.

I’ve spent the last couple of months grieving and assisting my family with working through the health care decisions, then memorials, estates and other issues associated with facing the illness and then death of parent. I plan to spend the next few posts discussing some of the lessons I’ve learned by being on the other side – education to practice so to speak – as my hope is to assist others to avoid some of the pitfalls we now face.

I can’t say that anything good has really come out of the losses I suffered this year but I will say that it confirmed my choice of profession. First, because I found relief in returning to work and assisting my clients and second because I feel that I use my law degree in the best possible way – to assist others to prepare for, and perhaps face, the worst times in their lives. For that I am grateful.


Monday, November 26, 2012

The ‘Sandwich Generation’ – Taking Care of Your Kids While Taking Care of Your Parents

The ‘Sandwich Generation’ – Taking Care of Your Kids While Taking Care of Your Parents

“The sandwich generation” is the term given to adults who are raising children and simultaneously caring for elderly or infirm parents.  Your children are one piece of “bread,” your parents are the other piece of “bread,” and you are “sandwiched” into the middle.
Caring for parents at the same time as you care for your children, your spouse and your job is exhausting and will stretch every resource you have.  And what about caring for yourself? Not surprisingly, most sandwich generation caregivers let self-care fall to the bottom of the priorities list which may impair your ability to care for others.

Following are several tips for sandwich generation caregivers.

  • Hold an all-family meeting regarding your parents. Involve your parents, your parents’ siblings, and your own siblings in a detailed conversation about the present and future.  If you can, make joint decisions about issues like who can physically care for your parents, who can contribute financially and how much, and who should have legal authority over your parents’ finances and health care decisions if they become unable to make decisions for themselves.  Your parents need to share all their financial and health care information with you in order for the family to make informed decisions.  Once you have that information, you can make a long-term financial plan.
  • Hold another all-family meeting with your children and your parents.  If you are physically or financially taking care of your parents, talk about this honestly with your children.  Involve your parents in the conversation as well.  Talk – in an age-appropriate way – about the changes that your children will experience, both positive and challenging.
  • Prioritize privacy.  With multiple family members living under one roof, privacy – for children, parents, and grandparents – is a must.  If it is not be feasible for every family member to have his or her own room, then find other ways to give everyone some guaranteed privacy.  “The living room is just for Grandma and Grandpa after dinner.”  “Our teenage daughter gets the downstairs bathroom for as long as she needs in the mornings.”
  • Make family plans.  There are joys associated with having three generations under one roof.  Make the effort to get everyone together for outings and meals.  Perhaps each generation can choose an outing once a month.
  • Make a financial plan, and don’t forget yourself.  Are your children headed to college?  Are you hoping to move your parents into an assisted living facility?  How does your retirement fund look?  If you are caring for your parents, your financial plan will almost certainly have to be revised.  Don’t leave yourself and your spouse out of the equation.  Make sure to set aside some funds for your own retirement while saving for college and elder health care.
  • Revise your estate plan documents as necessary.  If you had named your parents guardians of your children in case of your death, you may need to find other guardians.  You may need to set up trusts for your parents as well as for your children.  If your parent was your power of attorney, you may have to designate a different person to act on your behalf.
  • Seek out and accept help.  Help for the elderly is well organized in the United States.  Here are a few governmental and nonprofit resources:
    • www.benefitscheckup.org – Hosted by the National Council on Aging, this website is a one-stop shop for determining which federal, state and local benefits your parents may qualify for
    • www.eldercare.gov – Sponsored by the U.S. Administration on Aging
    • www.caremanager.org  -- National Association of Professional Geriatric Care Managers
    • www.nadsa.org – National Adult Day Services Association

Thursday, August 30, 2012

Minnesota Asks Federal Government for Medicaid Waiver in Attempt to Save Millions m

Gov. Mark Dayton is seeking a waiver from the Federal Government that will allow Minnesota to put into place its own bipartisan plan that should make it easier to connect people to services, steering them out of institutions and into home-based care. In seeking the wavier, the state asserts that instead of paying the astronomical cost of institutional care, the ability to go into a Medicaid recipient's home and install ramps, or bring in home-care workers who could allow the person to stay at home comfortably and will provide services at a more affordable price for the state. Rather than waiting until a worker loses a job because of a disability, the reforms would allow the state to reach out to employers and craft a plan to keep them working.

The Governor feels that this reform could save the state $151 million over the next five years. Minnesota estimates it could save another $9.2 million over the next five years by giving families more options for home-based care, and $15 million by expanding counseling and other support to people faced with a choice between expensive nursing home care and more affordable home care. At the center of the waiver request is the state's plan to offer incentives to health care providers that make preventive care available to Minnesotans on Medicaid.

The U.S. Department of Health and Human Services will respond to the state's proposal after a 30-day public comment period. If approved, the reforms would go into effect in 2014.


Wednesday, April 04, 2012

Guardianships & Conservatorships and How to Avoid Them

Guardianships & Conservatorships and How to Avoid Them

If a person becomes mentally or physically handicapped to a point where they can no longer make rational decisions about their person or their finances, their loved ones may consider a guardianship or a conservatorship whereby a guardian would make decisions concerning the physical person of the disabled individual, and conservators make decisions about the finances.

Typically, a loved one who is seeking a guardianship or a conservatorship will petition the appropriate court to be appointed guardian and/or conservator. The court will most likely require a medical doctor to make an examination of the disabled individual, also referred to as the ward, and appoint an attorney to represent the ward’s interests. The court will then typically hold a hearing to determine whether a guardianship and/or conservatorship should be established. If so, the ward would no longer have the ability to make his or her own medical or financial decisions.  The guardian and/or conservator usually must file annual reports on the status of the ward and his finances.

Guardianships and conservatorships can be an expensive legal process, and in many cases they are not necessary or could be avoided with a little advance planning. One way is with a financial power of attorney, and advance directives for healthcare such as living wills and durable powers of attorney for healthcare. With those documents, a mentally competent adult can appoint one or more individuals to handle his or her finances and healthcare decisions in the event that he or she can no longer take care of those things. A living trust is also a good way to allow someone to handle your financial affairs – you can create the trust while you are alive, and if you become incompetent someone else can manage your property on your behalf.

In addition to establishing durable powers of attorney and advanced healthcare directives, it is often beneficial to apply for representative payee status for government benefits. If a person gets VA benefits, Social Security or Supplemental Security Income, the Social Security Administration or the Veterans’ Administration can appoint a representative payee for the benefits without requiring a conservatorship. This can be especially helpful in situations in which the ward owns no assets and the only income is from Social Security or the VA.

When a loved one becomes mentally or physically handicapped to the point of no longer being able to take care of his or her own affairs, it can be tough for loved ones to know what to do. Fortunately, the law provides many options for people in this situation.  
 

 

 


Thursday, March 15, 2012

Cancer Treatment Often Leads to Bankruptcy

Cancer Treatment Often Leads to Bankruptcy

These days, it seems like everything under the sun, and even the sun itself, causes cancer. A recent study shows that cancer may cause yet another hardship for those diagnosed—Bankruptcy.  There are a number of reasons for this.  A patient may be unable to work during treatment or only able to earn an income during periods of remission. However, the primary cause is the enormous medical expense associated with the treatment of cancer, especially for those who are uninsured or under insured.

The study, “Cancer diagnosis as a risk factor for personal bankruptcy,” published in the Journal of Clinical Oncology, examined 231,799 cancer patients, and found that 4,805 of them, or 2.1 percent sought bankruptcy relief under Chapter 7 and Chapter 13 in the years following their cancer diagnoses. This corresponds to about a 700% increase in the incidence bankruptcy filings over that of the general population.

The study also found that certain types of cancer resulted in significantly higher rates of bankruptcy. Patients afflicted with lung, thyroid and leukemia/lymphoma cancers were most likely to seek bankruptcy protection, with 7.7 percent of lung cancer patients filing for bankruptcy within five years of being diagnosed. The study also found that surgery and chemotherapy increased the risk that some cancer patients would file for bankruptcy.

Researchers concluded that medical bills are a primary cause of the connection between cancer and bankruptcy because younger cancer patients sought bankruptcy relief at higher rates than older cancer sufferers. They believed this was due to the fact that older Americans have access to Medicare, and therefore do not bear the same costs for cancer treatment as younger patients.
 

 

 


Friday, December 30, 2011

Important Issues to Consider When Setting Up Your Estate Plan

Important Issues to Consider When Setting Up Your Estate Plan

Often estate planning focuses on the “big picture” issues, such as who gets what, whether a living trust should be created to avoid probate and tax planning to minimize gift and estate taxes. However, there are many smaller issues, which are just as critical to the success of your overall estate plan. Below are some of the issues that are often overlooked by clients and sometimes their attorneys.

Cash Flow
Is there sufficient cash? Estates incur operating expenses throughout the administration phase. The estate often has to pay state or federal estate taxes, filing fees, living expenses for a surviving spouse or other dependents, cover regular expenses to maintain assets held in the estate, and various legal expenses associated with settling the estate.

Taxes
How will taxes be paid? Although the estate may be small enough to avoid federal estate taxes, there are other taxes which must be paid. Depending on jurisdiction, the state may impose an estate tax. If the estate is earning income, it must pay income taxes until the estate is fully settled. Income taxes are paid from the liquid assets held in the estate, however estate taxes could be paid by either the estate or from each beneficiary’s inheritance if the underlying assets are liquid.

Assets
What, exactly, is held in the estate? The owner of the estate certainly knows this information, but estate administrators, successor trustees and executors may not have certain information readily available. A notebook or list documenting what major items are owned by the estate should be left for the estate administrator. It should also include locations and identifying information, including serial numbers and account numbers.

Creditors
Your estate can’t be settled until all creditors have been paid. As with your assets, be sure to leave your estate administrator a document listing all creditors and account numbers. Be sure to also include information regarding where your records are kept, in the event there are disputes regarding the amount the creditor claims is owed.

Beneficiary Designations
Some assets are not subject to the terms of a will. Instead, they are transferred directly to a beneficiary according to the instruction made on a beneficiary designation form. Bank accounts, life insurance policies, annuities, retirement plans, IRAs and most motor vehicles departments allow you to designate a beneficiary to inherit the asset upon your death. By doing so, the asset is not included in the probate estate and simply passes to your designated beneficiary by operation of law.

Fund Your Living Trust
Your probate-avoidance living trust will not keep your estate out of the probate court unless you formally transfer your assets into the trust. Only assets which are legally owned by the trust are subject to its terms. Title to your real property, vehicles, investments and other financial accounts should be transferred into the name of your living trust.
 

 

 


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From within Hennepin County Unique Estate Law represents estate planning and elder law clients throughout Minnesota, including Minneapolis, Edina, Bloomington, St. Louis Park, Minnetonka, Plymouth, Wayzata, Maple Grove, St. Paul, and Brooklyn Park. The Minnesota law firm of Unique Estate Law focuses on all aspects of estate planning, including specialized wills, trusts, powers of attorney and medical directives for married couples, young families, blended families, single parents, gay families and those going through a divorce. Unique Estate Law also handles probate administration, asset protection, Medical Assistance planning, elder law, business succession planning, adoptions and cabin planning.



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