estate planning attorney

What Is A Credit Shelter Trust?

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Cleveland, Ohio estate planning lawyer, Daniel A. Baron, of Cleveland, Ohio, offers the following information on what a Credit Shelter Trust is and should it be part of your comprehensive estate planning.

If you are married and an investor, for example, consider establishing a Credit Shelter Trust. This can also be referred to as an A-B Trust and is an Irrevocable Trust.

The benefits of a Credit Shelter Trust is, that it allows the assets of the trust (up to a predetermined amount, i.e. $500,000) to transfer to the beneficiaries specified within the trust, typically your children, without any estate taxes being assessed.    Also, your spouse continues to have all rights to the assets of the trust and any income generated until the spouse passes away.

If you are a blended family, a Credit Shelter Trust might be the right tool for you as part of your comprehensive estate planning. If at the time of death of the first spouse the assets of the deceased spouse to immediately into the Credit Shelter Trust.  If the assets transferred are larger than the predetermined amount (we used $500,000 as the example), the excess assets go into a trust which qualifies for the Marital Deduction.  Since the Credit Shelter Trust is irrevocable, it has great estate tax liability advantages as well as making certain your assets are passed along to your beneficiaries, typically your surviving spouse and your children.  Establishing a Credit Shelter Trust insures that the worry of the step-parent now getting all the assets, your assets will now be distributed to the beneficiaries as you intended them.

In the event your spouse is still living and would need to dip into the trust’s assets that were set aside for your children, it would be up to your Trustee to assess the necessity of the transfer of funds. The step-parent would not have carte blanche to the funds.

For answers to any questions you may have on a Credit Shelter Trust and making it a part of or your Comprehensive Estate Planning, contact Daniel A. Baron of Baron Law today at 216-573-3723. Let’s work together to see what the best Trust is for your situation.

Helping You and Your Loved Ones Plan for the Future

 

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Why Do I Need A Guardianship?

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Cleveland, Ohio, Estate Planning and elder law attorney, Daniel A. Baron, offers the following information on creating a Children’s Testamentary Trust for your loved ones. Is it the best option for you when creating your estate plan?

Most people understand and realize that they should name a Legal Guardian for their minor children. However, many people don’t take the necessary step further to consider the financial aspects of guardianship after a parent passes away. Creating a testamentary trust can alleviate this worry and for the most part is inexpensive to create.

Consider Establishing a Children’s Trust. 

Establishing a Children’s Trust, aka a Testamentary Trust, in your will, now creates a way for you to take care of your minor children after you have passed away. By naming a Trustee to oversee the trust allows them to take care of your children’s financial needs for everyday living and any health issues which may arise, as well as their future education needs.

What happens to your property should you pass and have minor children?

Unless specifically noted otherwise in your will, when you pass and your children are of legal age, they will automatically inherit all your property. But what happens if your children are minors?  When a Children’s Trust is established you can appoint a Trustee, or ‘Property Manager’ to oversee the property to make certain your minor children have a place to live and are cared for.  In the absence of a Property Manager being named, the courts will appoint a Property Custodian.  Depending on your individual circumstances, you may want to consider creating a Life Estate.

Should I create a trust for each of my minor children?

Upon your passing any children of legal age will automatically inherit your assets unless otherwise specified in your will. Let’s assume you have minor children, then it would be wise to set up a trust for each child and name a trustee to oversee the trust to make certain that the funds and property are used for the child’s needs and in their best interest.

If you do not wish to establish a trust for each child, consider a revocable living Trust or  Family Trust.  The Trustee(s) would handle this single trust in the same manner as if you were to set up individual trusts for each child.

When creating your Comprehensive Estate Plan you need to speak with an experienced Estate Planning lawyer. Contact Daniel A. Baron or Baron Law today at 216-573-3723 to answer any questions you may have on a creating a Children’s Trust.  I welcome the opportunity to work with you and help recommend the best solution for your needs.

Helping You and Your Loved Ones Plan for the Future

Veteran Benefits

Long Term Care – What Is Available To Veterans

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Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers information on Long Term Care assistance for those who have served in our military and including this as part of your Estate Planning:

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For those of you who have served in any of our armed forces, Thank You! Because of your bravery and sacrifice, we still enjoy the many freedoms we have in this country and you make us all proud to be Americans.

Should you, as a veteran require Long Term Care and you have a service related disability, the Department of Veterans Affairs pays for your Long Term Care and for certain other eligible veterans, you may also be entitled to additional health programs as well:

  • At home care for aging veterans with Long Term needs
  • Nursing home care

In order for veterans to stay in their homes and be more comfortable there are other programs as well.

A program that was developed in 2009 which provides veterans with a Flexible Budget in which to purchase services is a Veteran Directed Home and Community Based Services Program or     VD-HCBS as it is also known by. These are services available through the Aging Network in conjunction with the Veterans Affairs

Homebound Aid and Attendence – a cash allowance is provided to veterans with disabilities and their surviving spouses to purchase community based long-term services such as homemaker services and personal care assistance as well as to purchase a home. Eligible Veterans receive this as a supplement to pension benefits.

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For more information on reviewing your goals for Long Term Care, what is available for our Veteran’s and incorporating this into your Estate Planning, contact Daniel A. Baron of Baron Law at 216-573-3799.

Why Every Parent Should Establish A Guardianship Within Their Estate Plan

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Cleveland, Ohio estate planning lawyer, Daniel A. Baron, offers information on why every parent should establish a guardianship for their minor children within their estate plan:

 

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When is a guardianship necessary?

It is customary for the parents of minor children to make any and all legal decisions that are necessary to keep their children safe. There may come a time however, when the minor children need a guardianship established.

Some of the reasons in which a guardianship needs to be established are but not limited to:

  • The parent or parents are deceased
  • A minor inherits assets and the parent or parents are not qualified to make legal decisions
  • The parent or parents are not or cannot take care of the minor child any longer due to illness
  • The parent or parents cannot take care of the minor child any longer due to incarceration

What is role and responsibilities of the guardian?

  • Has the right to deny certain persons to come in contact with minor child or restrict the interaction with certain persons
  • Become the minors fiduciary by keeping inventory and control of all assets
  • Investing minors child’s assets
  • Pay the minor child’s bills
  • File income taxes annually
  • Decide where the minor child shall live

In some cases if you are a guardian you may need to get permission from the courts to carry out these duties.

In addition to overseeing the over-all wellbeing of the minor child and the estate, the guardian also has the following duties:

  • If necessary, bring a lawsuit on behalf of the minor child
  • If public assistance benefits are required, apply for them
  • Apply for public housing where needed for the minor child
  • Provide a legal residence for the minor child so that the minor child attends school and receives a quality education
  • Receive and maintain any funds given to support and care of the minor child
  • Authorize any care such as medical or other care necessary to insure the wellbeing and support of the minor child

Essentially the guardian looks after the minor child just as the parent or parents would have.

For more information on setting up guardianships for your minor children or your minor or adult child with special needs, contact Daniel A. Baron of Baron Law today at 216-573-3723.

Cleveland Elder Care Lawyer

When is a Legal Guardianship Necessary for my Parents?

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Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers information on when it becomes necessary to change legal guardianship for your elderly loved one:

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Legal Guardianship is used when a person is unable to make or make sound decisions about themselves personally or their property. These same persons can likely be or already have been a victim of fraud or undue influence.  Although a guardianship may limit a person’s rights considerably, establishing a guardianship should be used after other actions have failed or are no longer available.

In the event a legal guardianship may not be totally necessary there are some alternatives you may want to consider that will still protect your loved one:

Some rights of the elderly which may be affected once a guardianship is put into place:

  • Medical treatment consent
  • Making End of Life Decisions
  • Voting
  • Enter into a contract
  • Possess a driver’s license
  • Selling Property

It is always best if the guardian consults with the individual to make any decisions that affect that person if they are still able to make sound rational decisions. However sometimes, the guardian must make the decisions themselves if your loved one is no longer able to participate.  The guardian should always take into consideration the individuals wishes if they are known.

Let’s start the conversation about when is the best time to consider establishing legal guardianship for your loved one. For more information on reviewing your goals for Long Term Care as part of your Estate Planning, contact Daniel A. Baron of Baron Law today at 216-573-3723.

Dan A. Baron Best Lawyer

The Importance of an Elder Law Attorney

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Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers information on the importance of having an Elder Law Attorney to help plan for your future: Elder law attorneys are sometimes considered “authorities” as, although they can handle a wide range of other legal issues, they primarily focus on the needs of older adults and also […]

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Long Term Care – Paying for the Nursing Home

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Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers the following information on the paying for Long Term Care and incorporating it into your Estate Planning:

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There are misconceptions regarding Long Term Care and who is responsible for paying for any care. This information may be used for informational purposes only.  For more information, or to speak with an experienced Medicaid planning attorney, contact Dan Baron at Baron Law.

Medicare:

In Ohio, Medicare only pays for Long Term Care IF you require rehabilitative care or skilled services. Skilled services are:

    • If you are in a nursing home, the maximum number of days Medicare pays for is 100; however the average covered stay is much shorter at 22 days
    • If you are able to stay at your own home, Medicare pays for skilled home health care or other skilled in-home services but only for a short period of time
    • Medicare does not pay for any non-skilled assistance for your ADL’s (Activities of Daily Living) which tend to make up the majority of in home Long Term Care.
    • You are solely responsible for paying for Long Term Care services provided to you that would not be covered by any other public or private insurance programs. For additional information regarding Medicare, please visit https://www.medicare.gov/

 

Medicaid:

  • Pays for the largest portion of Long Term Care services, provided your income meets the states minimum eligibility requirements.
  • Medicaid will cover your costs depending on how much assistance you need with Activities of Daily Living.
  • There are numerous considerations when considering Medicaid and it’s important to talk with a Medicaid planning attorney.  To learn more about some considerations, visit this Medicaid Considerations Article.
  • There are other federal programs available for specific populations and circumstances that may pay for Long Term Care
    • Older Americans Act
    • Department of Veterans Affairs

Private Health Insurance

  • Employer sponsored or private health insurance, cover the same kinds of limited services as Medicare
  • If your carrier does cover Long Term Care, typically it will only be for skilled care but only short term

Other Private Payment Options can include

For more information on reviewing your goals for Long Term Care as part of your Estate Planning, contact Daniel A. Baron of Baron Law at 216-573-3723.

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When Should You Start Planning For Long Term Care?

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Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers information on when you should start planning for Long Term Care and including this as part of your Estate Planning:

 

When should you start planning for Long Term Care? If you are under 50, the answer is – “there is no time like the present”.  Approximately 70% of today’s population will need some sort of Long Term Care sometime within their lifetime.

What you should know about planning for the future

When in later years and you are in need of skilled services or should you require rehabilitation services, Medicare pays for this type of long term care. Unfortunately, Medicare does not pay for any non-skilled assistance with your ADL’s (Activities of Daily Life) or IADL’s (Instrumental Activities of Daily Living) which tend to make up the majority of Long Term Care.

You should start thinking now about how you are going to pay for Long Term Care as it is much more expensive than you might think.

There are a number of ways you can use to pay for your long term care. Being 50 of under, this may be the best time in your life financially to start planning for long term care, rather than after you have had a serious illness or become disabled.

You may also consider securing an Advance Directive which informs your family and other loved ones how you would like your medical matters handles, should you become incapacitated and are no longer able to communicate your wishes of your medical care.

For more information on reviewing your goals for Long Term Care as part of your Estate Planning, contact Daniel A. Baron of Baron Law today at 216-573-3723.

AN AB Trust – What are the benefits for your estate?

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Cleveland, Ohio estate planning attorney, Daniel A. Baron, offers information on an AB Trust and the benefits realized from including this as part of your Tax and Estate Planning:

For Tax and Estate Planning purposes, as a married couple, maximize the use of your Federal Estate Tax Exemptions through the utilization of an AB Trust.

There are two vehicles available in which to set up an AB Trust

  • Living Will and Last Testament
  • Revocable Living Trust

The “A Trust” also referred to as the

  • Marital Trust
  • Marital Deduction Trust
  • QTip Trust

The “B Trust” is also known as the

  • Family Trust
  • Bypass Trust
  • Credit Shelter Trust

In 2011, the Federal Estate Tax Exemption   was made transferrable between married couples.  Should one pass away in 2011 or after, their entire Federal Estate Tax Exemption is not needed to avoid Estate Taxes.

If you are on your second, third, or additional marriage and have different beneficiaries, it is in your best interest to explore the benefits of the AB Trust.

The AB Trust can only function if you secure them while both spouses are alive. Don’t put off securing this beneficial part of your estate and tax planning as once you become a widow or widower, it is too late.

Below is an example of how the AB Trust works to your benefit:

For more information on setting up an AB Trust as part of your Estate and Tax Planning, contact Daniel A. Baron of Baron Law to maximize your Federal Estate Tax savings upon your passing. Contact us today at 216-573-3723.

Medicaid Planning

Applying for Medicaid? Here’s What You Need to Know About Activities of Daily Living vs. Instrumental Activities of Daily Living

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Cleveland, Ohio estate planning and elder law attorney, Daniel A. Baron, offers the following information on the definition of ADL’s and IADL’s and how to plan on Long Term Care as part of your Estate and Medicaid Plan: As we are all well aware, there is only one alternative to aging. If you are fortunate […]

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