Elder law estate planning is a unique legal niche that addresses two often interrelated sets of needs. Over the past few decades many more families have become exposed to “estate taxes” and have been made aware of the costs of the probate process. As a result, the creation of trusts to avoid probate has increased in popularity. Concurrently, many of those same individuals need assistance navigating the often complex processes connected to long-term healthcare. The effect of Medicaid rules and regulations, nursing home costs, and similar factors become a vital part of the decisions that all individuals make about their overall estate.
The interrelatedness of these two areas makes the understanding of both vital for effective planning. In other words, estate planning may be ineffective without accounting for elder law issues and vice versa.
Even with the growing popularity of these issues, many community members remain unfamiliar with the legal niche that combines both. Earlier this week a New York elder law estate planning lawyer from our firm, Bonnie Kraham, Esq., published a story in the Times Herald-Record that attempts to spread some basic information and terminology about elder law estate planning. A variety of terms are defined to take some of the mystery out of the process. Many of these are words that residents may have heard discussed but never knew exactly to what they referred.
For example, in legal parlance an “estate” consists of all of an individual’s property and assets. It includes a wide range of things from homes, bank accounts, stocks, life insurance, and even personal items like jewelry. The “estate tax” is imposed upon the estate based on the value of all of those things. Many people remain surprised at the scope of items that are counted toward the tax which the survivors must pay.
Medicaid is the “needs based” medical insurance program that the state administers which often provides payment for services like nursing home care. The “Medicaid Asset Protection Trust” is a trust created while one is alive to protect them from the expense of long-term care and nursing home costs. In general, these trusts allow an individual to receive support through Medicaid without first wiping out their assets to pay for the costs.
All of our New York elder law estate planning lawyers are eager to share information about this legal arena. We welcome the chance to explain how it can help you pass on your assets to your heirs according to your wishes while protecting them from taxes and all potential long-term healthcare costs.
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