FAQs - Elenora L. Benz, Esq.
What if I am not sure what my legal needs are?
Come check us out! Often times, clients meet with us for a one or two hour consultation, paid for at the time, just for purposes of gathering accurate information as to the options that they have. Some clients then retain us to do additional work for them, but others come just for the consultation. Many of our clients are referred to us by attorneys, bank trust officers, accountants, and financial planners and managers, and social workers who have already identified a client’s need for estate planning.
What’s included in a “complete” estate plan? Why do I need an estate plan?
Wills, Trusts, and Living Wills are an integral part of almost every estate plan. A Durable Power of Attorney is a powerful business tool that should be a part of every complete estate plan. Many people believe that because their total assets are under the federal exemption amount they do not need an estate plan. Nothing could be further from reality. Everyone needs to plan for the orderly distribution of their assets after death and the appointment of executors, guardians, and trustees. This can best be done in a will, created in the context of a “complete” estate plan.
Now that there the $5,000,000 federal estate and gift tax exemption has been made permanent, do I still need to do estate planning?
Estate planning is not strictly tax planning. Despite what you may have read in the press or heard on radio or television, you still need to plan your estate and it still may need tax planning. Don’t fall prey to the belief that because there is now a permanent and unified $5,000,000 federal estate and gift tax exemption that you don’t need to do any planning. Now, in fact, is an excellent time to plan your estate with the maximum flexibility built into your documents. The $5,000,000 exemption is indexed for inflation, the tax rate has been raised to 40%, and the new law passed at the end of 2012 has made the concept of portability permanent as well.
What about other death taxes?
New Jersey has its own version of a death tax which was enacted in 2002, and for which the exemption is only $675,000. In addition to the New Jersey death tax, there is also a New Jersey Inheritance Tax from which only your spouse, civil union partner, and lineal descendants are exempt.
What are the fee arrangements?
Consultations are paid for at the time of the consultation. A basic set of estate documents is available at a flat fee. All other legal work is done on a retainer basis meaning that we ask that you deposit a retainer with us against which we can bill as services are provided. On protracted matters such as litigation we will ask you to replenish the retainer as needed. ALL TERMS and CONDITIONS are spelled out in a retainer agreement provided for your review before we accept any retainer money.
How is document preparation accomplished?
I prepare all of your estate planning documents. At our second meeting, before you sign your estate planning documents, I will review these documents with you.
How do my retirement plans fit into my estate plan?
Today, significant portions of my clients’ asset mix include company-managed 401(k) plans and self-directed funds known as Individual Retirement Accounts. These tax-deferred retirement plans present challenging issues in the estate planning process. I may recommend that you include in your plan structured beneficiary designations allowing your retirement plan to work within your overall estate plan.
How often should I review my estate plan?
Depending on their age, I advise my clients to review their estate plan every one, two or three years and to advise me of any personal, business, or financial changes that may affect their own estate plans. Estate planning is an on-going process and not something you do once and then forget about.
How is life insurance used in estate planning?
Holding life insurance in an irrevocable life insurance trust could help keep your heirs’ inheritance from being reduced by estate taxes. That’s one good reason to carefully consider the role of life insurance in your estate plan, either to plan for the liquidity to pay estate taxes or for asset value replacement. Remember, life insurance proceeds are not subject to income tax, but without appropriate planning for their ownership, they are included as part of your gross estate for federal estate tax purposes.
How should I store my estate planning documents?
Many of my clients have fireproof cabinets or safes at home with at least a one-hour rating and so they retain their original documents. If my clients do not have any fireproof storage available, their estate planning documents may be stored with me. Remember, only an original will may be probated without a court proceeding, so proper, safe retention is critical.
How is probate and administration of decedents’ estates accomplished?
From the first appointment with the Surrogate, through the final accounting and distribution of the estate to the beneficiaries, I offer compassionate attention to the bereaved family while providing efficient and timely service, working hand-in-hand with executors and trustees. Because I encourage executors to perform as many of the tasks of administration as they are comfortable handling, the cost of administration can be reduced. My paralegal staff also stands ready to assist with those tasks which the executor or administrator may not be comfortable in handling.
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FAQs - Nancy Heslin Reading, Esq.
What is Long Term Care Planning?
Long term care planning involves much more than buying long term care insurance although that is a great start if you can afford it. Some simple but very important steps are within reach of everyone. A long term care plan begins with executing a health care power of attorney (also known as a health care proxy) in which you appoint someone to make health care decisions for you if you cannot make them for yourself. At the same time, an advance directive should be executed to guide your health care representative as to what your wishes are for your health care. You should execute a Durable Power of Attorney appointing a responsible person to handle your finances if you cannot manage them for yourself because someone will need to manage your finances, apply for Medicaid or do Medicaid planning, evaluate your Medicare coverage and determine which Medigap policy and Part D pharmaceutical coverage is right for you. These steps are affordable and within reach even if you can't afford long term care insurance.
If you can afford long term care insurance, different insurers and plans require careful evaluation. Also, if you have significant assets, a long term care plan should seek to provide excellent health care while also protecting some of your assets for future generations. Most of all, a long term care plan provides peace of mind knowing that should the day come when you cannot provide for your own health care, the people you have hand-chosen are in place with the tools they need to provide for all your health care needs.
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When does it make sense to hire an attorney to handle your Medicaid application?
An elder law attorney can help you qualify for Medicaid by creating a “spend-down” plan if you have assets that exceed the allowable maximum. An attorney can also be very helpful where one spouse needs nursing home care and the other will be remaining at home by fashioning a plan that protects sufficient assets for the community spouse. If you apply for Medicaid yourself and are denied, an attorney can help you evaluate whether you should appeal that result. If your assets are minimal and you have not gifted away any assets within the last five years, you probably do not need an attorney to assist you. Contact the County Board of Social Services to start the Medicaid application process.
Is it true that Medicaid can take my house?
No, Medicaid does not take anyone's house in the sense that they put homeowners out in the street; however, if you are a Medicaid beneficiary and own your own home, Medicaid will have the option of recording a lien against your home after you die for the dollar value of the services they provided to you. For example, if you qualify for Medicaid and Medicaid pays out $97,000 in medical benefits for you, then when you die Medicaid can file a lien against your home to recover that $97,000 when the home is sold. If a spouse is living there, Medicaid will not enforce the lien until after the spouse dies. There are certain other exceptions, but generally Medicaid will have a lien against the property and will enforce the lien when the home is sold. An attorney can assist you in determining what steps can be taken to avoid a Medicaid lien and whether you would fit within one of the exceptions to the lien law.