Basics of Estate Planning Legal Tools to Uphold Your Wishes and to - - PowerPoint PPT Presentation
Basics of Estate Planning Legal Tools to Uphold Your Wishes and to Protect Loved Ones The Elder & Disability Advocacy Firm of Christine A. Alsop, LLC phone (314) 644-3200 | fax (314) 206-4745 calsop@alsopelderlaw.com | www.AlsopElderLaw.com
The Elder & Disability Advocacy Firm of Christine A. Alsop, LLC | 1 The Elder & Disability Advocacy Firm of Christine A. Alsop, LLC phone (314) 644-3200 | fax (314) 206-4745 calsop@alsopelderlaw.com | www.AlsopElderLaw.com 6654 Chippewa Street, St. Louis, MO 63109
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Legal Tools to Uphold Your Wishes and to Protect Loved Ones
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THE FOUR WAYS THAT OWNERSHIP OF PROPERTY IS TRANSFERRED AT DEATH
PROBATE: Probate assets are the only assets transferred pursuant to the decedent’s Will. BY WILL NON-PROBATE: Probate assets: titled in
(Note: A Trust set out in a Will is referred to as a Testamentary Trust and it does not avoid probate administration. Typical Examples: Husband/Wife Parent/Child Grandparent/Grandchild Among Siblings A legal entity that is similiar to a family corporation. Benefjciary Designations: Life Insurance Policies IRA Accounts Annuities Brokerage Accounts: TOD Real Estate: Benefjciary Deeds US Savings Bonds: POD Motor Vehicles (DOR): TOD Bank Accounts: POD) Personal Property: Deed of Gifu BY JOINT OWNERSHIP BY CONTRACT BY TRUST KEY: DOR = Department of Revenue; TOD = Transfer on Death; POD = Paid on Death Through the probate process, assets pass to the Benefjciaries named in the Will (can be individual/s
Assets pass to surviving, titled owners (can be individual/s or Trust/s) Assets pass to Benefjciaries, pursuant to Benefjciary, TOD
individual/s or Trust/s) Assets pass to the benefjciaries named in the Trust (children, grandchildren, etc.) Pour-Over Will Deed of Gifu: Household items and similar personal property
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Durable Power of Attorney: The power of the attorney-in- fact to act on the principal’s behalf continues despite the principal’s incapacity, whether or not a court decrees the principal to be incapacitated Power of Attorney (without “Durable” language): The power of attorney is revoked and the power of the attorney-in-fact to act for the principal automatically stops if the principal becomes incapacitated
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Springing Power of Attorney: This type of power
incapacitated or when some other stipulated event or condition occurs, thus “springing” the power of attorney into action Non-Springing of Attorney: This type of power of attorney is efgective immediately upon execution of the document and remains efgective in the event of the principal’s disability or incapacity
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Principal: the person who creates and signs the Durable Power of Attorney Attorney-in-Fact: the person who the principal appoints to act on his or her behalf The attorney-in-fact (AIF) has a duty to act in the interest of the principal and to maintain contact with the principal, communicate with him or her and follow his or her wishes The AIF must avoid self-dealing and must act using a high degree of care Once the Durable Power of Attorney is signed, the AIF has a fiduciary relationship and obligation to the principal
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Powers include: Manage property and business afgairs Apply for government benefits Manage all bank accounts Hire an attorney Enter into a contract
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Survives the incapacity of the principal Efgective as soon as the principal signs Not valid where it is later determined that the person lacked the mental capacity to execute the document Efgective tool to prevent guardianship Make financial decisions Prevent state/court involvement
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What is a Special Needs Trust? Also known as a supplemental needs trust To “supplement,” not replace, public benefits for person who is deemed disabled In this context – any type of disability as defined by Social Security at 42 USC 1382c(a)(3)
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Difgerent forms of SNTs codified in Omnibus Budget Reconciliation Act in 1993 (OBRA ’93) Self-Settled or Third-Party Inter vivos or Testamentary Facts and circumstances will determine type of trust
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Three types of SNTs (d)(4)(A) (d)(4)(C) Third-Party SNT
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Created by anyone other than the person who was disabled Funded by a third-person Beneficiary - can be anyone Grantor trustee - yes Distributions to third-parties Payback - no Disability defined by SSA Gifu tax exclusion - can use Testamentary - yes Age limit - none Frequently used for - any use
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Not just a form Risks Loss of benefits
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Needs-based Limited income and assets
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Medicaid Qualification Some states is automatic qualification MO, not – still have Medicaid qualification
Home One car Pre-need burial agreements...
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Not means-tested No financial eligibility requirements Medicare qualification 24 months afuer receiving SSDI
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disabled person
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THE ELDER & DISABILITY ADVOCACY FIRM OF CHRISTINE A. ALSOP, LLC 6654 Chippewa Street, St. Louis, MO 63109 (314) 644-3200 | www.AlsopElderLaw.com
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