Burner Law Group, P.C.

A Medicaid Asset Protection Trust is an irrevocable grantor trust that protects assets from the prohibitive cost of long-term care. In NYS, the grantor (creator) can retain the right to receive income generated from assets in the trust as well as the ability to change trustees and beneficiaries. The grantor is not however entitled to principal. If the trust holds a primary residence, the grantor retains the right to live in the house until his or her death. Medicaid Asset Protection trusts are especially important for married couples so that one spouse does not become impoverished while the other spouse is receiving care.

New York State adopted a statutory Durable Power of Attorney form in 2010 that allows your named agents to make financial decisions on your behalf and assist in taking care of your daily financial obligations. The “durable” description means that the document remains in effect even if you become incapacitated.

In a health care proxy, you nominate someone to make medical decisions for you if you cannot do so for yourself – either permanently or temporarily. A Living Will documents what end of life treatments you would want if you were in a vegetative, irreversible state with no reasonable expectation of recovery.

In New York State, the statutory compensation under SCPA § 2307 for each Executor is 5% on the first $100,000 in the estate, 4% on the next $200,000, 3% on the next $700,000, 2-1/2 % on the next $4,000,000 and 2% on any amount above $5,000,000. In addition, Executors (and Administrators) are reimbursed for all legitimate out-of-pocket expenses incurred in the process of management and distribution of the deceased estate.

A simple Will can be drafted quickly, but only after the clients meet with the attorney, disclose their assets, and decide on the terms of the Will. The clients in this case are the parents and the attorney maintains a confidential relationship with them and will not discuss the case with anyone else, including a well-meaning child, unless the client agrees to the disclosure in writing.

The cost and duration of probate can vary substantially depending on a number of factors such as the value and complexity of the estate, the existence of a Will and the location of the estate. Common expenses of an estate include executors’ commissions, attorneys fees, accounting fees, court fees, appraisal costs‚ and surety bonds - which typically add up to 2% to 7% of the total estate value. Most estates are settled through probate in about 9 to 18 months, assuming there is no litigation involved.

If you have legal standing to object to a Will, you must show some impropriety with the execution of the Will, such as the will not being properly executed, induced by fraud or undue influence, or show that the decedent lacked capacity at the time he or she executed the Will.

Only an “interested party” has legal standing to challenge a Will. An interested party means that the objector would have inherited a portion of the decedent’s estate if the decedent died without a will, or the objecting party was a beneficiary in a former will, or the objecting party is a beneficiary of the current will.

Which assets pass through Probate depends on how the particular asset is titled. Any assets titled in a decedent’s sole name pass through the probate or administration process. Certain types of assets are deemed “non-probate assets” that bypass probate or administration in the Surrogate’s Court and pass directly to beneficiaries and include property owned jointly, retirement accounts with designated beneficiaries, life insurance policies with designated beneficiaries, accounts with “transfer on death” designations, and property owned in a trust.

Probate is a Surrogate’s Court proceeding whereby a decedent’s Last Will and Testament is validated and given effect. Under NYS Law, a Will is admitted to probate after the nominated Executor files a Petition for Probate with the decedent’s Will attached and gives proper notice to the individual’s that would have inherited from the decedent’s estate had the decedent died without a Will. The Court issues “letters testamentary” which give the Executor the authority to act. The Executor pays the debts of the estate and then makes distributions to the beneficiaries.

Any asset that is held in your sole name and does not have a transfer on death designation or beneficiary designation must pass through probate. Although technically real property passes automatically to heirs or beneficiaries, it usually must pass through the probate process to be sold and obtain a clear title.

The best way to protect your assets in New York State is to essentially move them out of your name, for example through creating an irrevocable trust or family limited partnership.

Estate taxes can be avoided by leaving all your assets to your spouse, utilizing a deceased spouse's unused exemption (DSUE), gifting up to the annual exclusion amount each year, and selling assets in exchange for annuity payments, such as in grantor retained annuity trusts. In states like New York where the estate tax is lower than the federal exemption, the state tax can be avoided by gifting assets up to the Federal Lifetime Gift and Estate Tax Exemption.

Probate is necessary for any assets owned in your sole name at death, therefore the only way to avoid probate is to place all of your assets into a trust or make sure all of your accounts are owned jointly. Some assets are non-probate assets, such as retirement accounts and life insurance policies do not pass through probate so long as you have named a beneficiary.

Community Medicaid allows seniors to receive home health aide services while remaining in their home, thereby avoiding assisted living facilities and nursing homes. So long as you continue to receive services in your home and the equity value does not exceed $893,000 or a spouse or minor disabled child is living there, your house is an exempt asset. However, upon either your death or the death of your spouse, Medicaid can put a lien on your estate. Proper planning can avoid this outcome.

Medicaid is a joint federal-state program that provides medical long-term care assistance to individuals needing nursing home care, who are 65 or older‚ disabled or blind. Recipients must meet certain income and asset guidelines. Applicants can generally have no more than $15,750.00 in available resources, however, certain assets are considered exempt and do not count toward eligibility. Any income over $50.00 must go toward the cost of care. Engaging in Medicaid planning early can preserve assets in case nursing home care is needed.

There is no specific information potential clients need to gather before an initial consultation. Burner Law Group provides all potential clients with a comprehensive questionnaire that includes general questions about assets. Every estate plan is tailored to a client’s particular needs and circumstances.

An elder law attorney helps clients and their families navigate the challenges unique to seniors as they age. Elder law attorneys can help seniors with planning for long-term care, determining eligibility for government benefits, ensure legal documents such as wills, trusts and advanced directives (durable power of attorney, living will and health care proxy) are in place. Burner Law Group is a vocal advocate for aging in place and entering the third age with a clear plan of action that can protect them in case of incapacity.

Burner Law Group’s practice areas include estate planning, probate and estate administration, real estate, business succession planning, special needs planning, elder law and guardianship proceedings.

Elder law is concerned with aiding seniors in implementing estate plans with a particular focus on long-term care, incapacity, and wealth transfer at death. Elder law attorneys can help clients with Medicare, Medicaid, and Guardianship specific issues, which are especially important as we age. Burner Law Group is an advocate for “Aging in Place” to allow seniors the greatest autonomy.

A living trust is a term that can describe any trust created during your life. It is possible that you have a trust which already protects your assets from Medicaid; however, if your trust is a revocable trust, the assets are not protected. If you are unsure what kind of trust you have, please feel free to reach out to our firm for a consultation. We would be happy to review your existing documents.