Educational Alerts
Educational Alerts are written on topics that effect various aspects of estate planning and the laws that govern it. They are usually published and posted to this site at the end of each month. Occasionally newsworthy events will initiate the release of additional alerts at the time the news breaks. The purpose of an Estate Planning Update is to bring important information to the financial advisors in the community. Our hope is that this information better equips you to assist your clients.
Court of Appeals Affirms Recognition of Social Security Disability Income Assigned to a First Party Special Needs Trust for Purposes of Nursing Home Share of Cost Calculations
This Alert examines a case involving the use of a Special Needs Trust (SNT). SNTs can be very useful in allowing individuals to keep the benefit of some assets and yet still qualify for Medicaid or other resources. Unfortunately, the Court of Appeals in this case held that the SNT could not be used to shelter the individual's Social Security Disability Income (SSDI). The case illustrates the importance of seeking assistance from a qualified estate planning and elder law attorney when planning for clients with current or future special needs (of themselves or their beneficiaries).
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New Jersey Court Upholds Asset Protection Trust
This Alert illustrates the importance of incorporating Asset Protection planning when doing Estate Planning. The client in the case prepared a fully discretionary trust for her son, thus keeping it from being attached by his creditors. Make sure your clients consider whether their estate plan will protect the assets they intend to leave to their family.
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Recent Law Changes of Note to Financial Professionals
This Alert examines changes the recent expansion of FDIC insurance coverage and how it applies to accounts in revocable trusts. The Alert also examines how the extension of the allowance of the IRA "charitable rollover" can help your client achieve their philanthropic and tax goals.
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Technical Amendment to Deficit Reduction Act of 2005 Causes Immediate Annuities to Further Lose Their Luster for Medicaid Planning Purposes
This article examines technical corrections to the DRA. The article sets forth that while the technical corrections made annuities less attractive, they are still a viable option in Medicaid planning. It offers examples of how one might structure an annuity differently to avoid rule changes from the technical corrections to the DRA.
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Passage of the Deficit Reduction Act Will Not Mean the End of Medicaid Planning
On February, 8, 2006, the President signed into law the Deficit Reduction Act of 2005 ("the Act"). There have already been challenges to the Act but it appears it will be valid law. When the Senate and the House of Representatives voted in favor of passing the Act, many people were predicting the end of Medicaid planning.
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Enrollment Period for Medicare Part D on the Horizon
This article gives a brief explanation of Medicare Part D, the new prescription drug plan. Seniors will begin receiving information about this plan between mid-October and year-end.
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Chances for Repeal of the Estate Tax Lessen -- Congress May Settle for Permanent Increase in Exemption Amount
The article examines pending legislation concerning potential repeal of the estate tax. It discusses the more likely outcome of an increase of the applicable exclusion amount. It concludes that the need for estate planning will remain greater than ever for non-tax reasons.
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Ninth Circuit Court Affirms Asset Protection for Trust Beneficiary
One of the advantages of establishing trusts for beneficiaries as opposed to
outright distributions is asset protection. In the case In re John and Holly
Coumbe, Debtors, a Bankruptcy Trustee sought to include the assets of a
testamentary trust created by the debtors mother in his Chapter 7 bankruptcy
estate. The Court held the trust assets were unavailable to the debtors
creditors.
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FDIC Simplifies Trust Rules: Expanded Coverage Could Benefit Many Consumers
In 2003, the Federal Deposit Insurance Corporation ("FDIC") solicited comments to its two proposed alternatives for simplifying the rules for insuring bank accounts owned by trusts. After reviewing the comments it received, on January 13, 2004 the FDIC announced a new regulation for trust bank accounts.
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Tricks and Traps Concerning Annuities
Because there are many tax traps concerning annuities, it is important for the financial advisor to know the treatment of annuities when advising clients.
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Care Must Be Taken When Disinheriting an Heir
It is not uncommon for a person to place provisions in his or her will or trust to exclude an heir from receiving an inheritance. Such was the desire of Mary Bartels, who wished to disinherit her daughter, Deborah Smith, and whose will was the subject of dispute in the case In the Matter of the Estate of Mary Alberta Bartels, Deceased, 184 Or. App. 448, 56 P.3d 501 (October 23, 2002).
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Joint Tenancy, a Will or a Trust? What's the Best Way to Plan Your Estate
Taxpayers and Estate Planners generally agree that Intestate Probate, also known as "the governments estate plan for you if you fail to plan your own," is never preferable to creating your own estate plan.
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Joint Tenancy Dangers
Topics include: Tax Problems, Loss of Control & Much More, No Avoiding Probate, Losing Control, A Taxing Issue, A Matter of Risk, The Better Way to Handle Title to Property, The Financial Advisor's Role in the Living Trust and Taxation Alert: The Case of the Double Domicile.
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