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Baron Law Cleveland Attorney

I’ve Been Named As The Executor In A Will, Now What?

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Cleveland, Ohio, estate planning law firm, Baron Law LLC, Cleveland, Ohio, offers the following information on what your duties are as an executor of an estate.  Contact Baron Law Cleveland to answer all your questions on what your duties are and to help guide your through the  upcoming events which are about to occur and how to handle any issues which may arise.

Unfortunately, a close friend or family member has passed and in their will you were appointed as executor of their estate. At the time the will was drafted maybe you gave little or a lot of thought into what being named executor actually entails. Often, it’s the former, most people have little experience administrating an estate and little reason to overthink being named an executor. So, when the time comes to handle the responsibilities of an executor, it can be a confusing and overwhelming process.

An appointment to executor is a serious affair, but an understanding of the process and expectations of an executor can limit the stress of an already stressful situation. Since most people have little experience with wills, estates, or probate, everyone finds themselves asking the same questions when they remember they’re an executor. Note, this article is only a minor overview and contacting a Cleveland estate planning attorney in event of death or a potential or actual appointment as executor is always recommended. An experienced Ohio estate planning attorney can give you personalized guidance and recommendations to take as much of the burden off you as possible.

 

What is an executor?

Bluntly, an executor is the person, or persons, named in a will to administrate the estate after death. The executor is the individual responsible for seeing that the final wishes of the decedent, as denoted in the will, are carried out. The appointment of an executor is a logical, and necessary, consequence for the existence of last will and testaments. At the end of the day, wills are only pieces of paper. So, without someone loyal, trustworthy, and actually willing to carry out the terms of a will, a will would be a paper tiger and estate assets wouldn’t be distributed nor posthumous debts and obligations handled. So, if you’ve been named as an executor, congratulations, you’re likely the most responsible and well-adjusted of the decedent’s friends and family.

 

How is an executor appointed?

Executors are formally appointed as such by explicit provision in a last will and testament. Hopefully, the will holder informs the named individual of their selection of executor, but this is not a strict requirement, just courtesy and commonsense.

Just being named as executor in a will, however, is not sufficient to confer the job. When the will is probated, the following statutory requirements are observed by the court when selecting an executor:

  1. The named individual must be competent to serve as executor.
  2. The named individual must be at least 18 years old
  3. The named individual must be bonded

Implicit within the bond requirement is that the named executor has good credit and no criminal record, since failure of either would likely make it next to impossible in convincing an insurance company to take the increased risk and issue an executor bond. The cost of the bond itself is paid from estate assets. Note, however, a will has the discretion to waive the bond requirement if the decedent has faith that the named executor is trustworthy and doesn’t represent a risk of pillaging or mismanaging estate assets.

As with many things within the legal system, the final approval for executor appointment lies with the probate court. So, regardless of whether the formal requirements are met, a probate court may still reject an executor election and appoint a third-party administrator if a potential executor is perceived as unfit to serve. Since, a major purpose of drafting a will is to control who distributes estate assets, naming an Ohio estate attorney as a primary or successor executor is advisable as a probate court would have little reason to protest such an appointment.

Why is an executor needed?

The duties of an executor aren’t easy, however, there is satisfaction knowing that you did right by your friend or family. The duties of an executor are specific to each particular estate, however, there is a “core” group of duties and tasks each executor must fulfill. Every executor must:

  1. File the will and probate petition in probate court where decedent was domiciled at time of death and petition the court for executor appointment.
  2. Take possession, catalogue, and value all estate property within 3 months of filing the will for probate.
  3. Maintain and protect estate assets for the duration of the probate proceedings.
  4. Directly notify creditors, debtors, financial institutions, utilities, and government agencies of decedent’s death.
  5. Publish notices of decedent’s death, usually a newspaper obituary, which serves as notice and starts the clock running on the statute of limitations for creditor claims on the estate.
  6. Pay or satisfy any outstanding debts or obligations of decedent.
  7. Represent decedent during probate court proceedings.
  8. Locate heirs and named beneficiaries and distribute respective bequests at the appropriate time.

These duties occur during the probate process, which is a major reason why probate takes many months to complete. Because probate is such a time-intensive and laborious process, many people chose trust-based estate plans that avoid probate entirely. With trusts, estate assets can be distributed right away, no executor is needed, and many mornings, which otherwise would be spent in probate court, are freed for personal enjoyment. Contact an Ohio trust attorney to see if avoiding probate through the use of trusts is right for you and your family.

What if some dies without a will so that there isn’t an executor?

If someone dies without a will, i.e. intestate, the probate court will appoint an administrator for the estate. The formal requirements for an administrator are the same as an executor except administrators must be also an Ohio resident while executors can be anyone. The duties administrators perform are largely the same as executors.

Granted, the final result of the probate process is the same regardless of whether an estate is administrated by an executor or appointed administrator, however, who knows who the court ultimately will appoint. As such, it is always preferable to elect an executor an ensure a responsible and diligent friend or family member will manage your estate and see that final wishes are followed. Those living without a will or trust are playing with fire and could end up seeing significant portions of lifetime earnings or assets going to irresponsible family members or eaten by taxes.

If I’ve been named as an executor, do I have to be one?

No, there is no legal requirement to take on the responsibilities of executor, however, resigning will likely put the surviving family in a serious bind and force a probate court to appoint an administrator. An executor resignation, prior to or during probate proceedings, must follow established procedures and use particular legal forms specific to each probate jurisdiction. Consulting an estate attorney is the best way to find out what these procedures are and if resigning is necessary in the circumstances.

Executor appointment is not a job to underestimate. Often, the labor and time spent in fulfilling the duties go underappreciated, but it is critical to wrapping up decedent’s life and giving closure to friends and family. Though sometimes thankless, executors are entitled to compensation in Ohio. Namely, if executor sells real estate or personal property, they are entitled to 4% of the first $100,000, 3% of the next $300,000, and 2% of any remaining value. Further, 1% may be charged for any non-probate assets. Executor fees and the associated tax consequences are potentially complex issues, as such, contacting a Cleveland estate attorney is sensible.

For more information, you can contact Mike Benjamin of Baron Law LLC at 216-573-3723. Baron Law LLC is a Cleveland, Ohio area law firm focusing on estate planning and elder law. Mike can also be reached at mike@baronlawcleveland.com.

 

Helping You and Your Loved Ones Plan for the Future.

 

About the author: Mike E. Benjamin, Esq.

Mike is a contracted attorney at Baron Law LLC who specializes in civil litigation, estate planning, and probate law. He is a member of the Westshore Bar Association, the Ohio State Bar Association, the Cleveland Metropolitan Bar Association, and the Federal Bar Association for the Northern District of Ohio. He can be reached at mike@baronlawcleveland.com.

Disclaimer:
The information contained herein is general in nature, is provided for informational and educational purposes only, and should not be construed as legal or tax advice. The author nor Baron Law LLC cannot and does not guarantee that such information is accurate, complete, or timely. Laws of a particular state or laws that may be applicable in a given situation may impact the applicability, accuracy, or completeness of the preceding information. Further, federal and state laws and regulations are complex and subject to change. Changes in such laws often have material impact on estate planning and tax forecasts. As such, the author and Baron Law LLC make no warranties regarding the herein information or any results arising from its use. Furthermore, the author and Baron Law LLC disclaim any liability arising out of your use of, or any financial position taken in reliance on, such information. As always consult an attorney regarding your specific legal or tax situation.
“He who is always his own counselor will often have a fool for his client.” Old English Proverb est. circa

 

Baron Law Cleveland

Estate Planning – Documents I Should Provide My Attorney

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Cleveland, Ohio, estate planning lawyer, Daniel A. Baron, Ohio, offers the following information on what documents are necessary for you to provide your attorney when sitting down to establish your comprehensive estate plan.

“Be prepared.” Boy Scouts of America

A recent survey taken by the AARP found that 3 out of every 5 Americans have no estate-planning documents, not even a simple will. Thus, money and assets they’ve spent a lifetime earning and saving are at risk from creditors, litigation, and state and federal taxation. Further, none of their friends or family know how to handle their affairs or last wishes. Even though the majority of people have not taken the necessary steps to formulate a plan when the inevitable comes, all can agree that leaving friends and family to scramble to pay your debts, settle your accounts, and divide your worldly possessions is not the best way. A time of mourning should be just that, for mourning, not for calling bankers, insurance agents, or accountants.

Hopefully, you’ve decided to take the first step and enter into the minority of Americans who proactively address what is left behind when they pass. However, a familiar question exists, how do I get started? That is, what do I need to start planning my estate?

Most, if not all, lawyers are traditional, they like things they can touch and read. So, before you meet with your attorney to plan your estate, you’re going to want to bring a few things. The following list is by no means exhaustive but will give you a good start. Collecting these documents before your meeting will save everyone time, allow your attorney to better comprehend your personal estate planning needs, and prepare you mentally so you can better communicate what you want and what your family needs out of your estate plan.

A General Accounting of your Estate

The word estate is a term that denotes all of the money, property, and debts owned by person, particularly at death. Naturally in order to plan an estate, it must be known what an estate actually encompasses. Therefore, on a piece of paper or computer spreadsheet, your going to write out your estate.

List out: your taxable accounts, your retirement accounts, any life insurance policies, any annuities, your personal residence, other real estate, any highly significant personal property (cars, furniture, artwork, jewelry, etc.), business interests, and any outstanding debts, liabilities, or obligations. For each category, split them up between those owned solely by you, those owned solely by your spouse (if married or part of a civil union), and those owned jointly.

This information is critical for tax projections and allows your attorney to take the necessary steps now, or at death, to ensure that the most property and money goes to where you want and not lost via government taxation, creditors, or litigation. There is a multitude of ways your attorney ensures estate preservation, however, knowing exactly what you have and what you want to do with it is critical. Note that this list only serves as an estimate of your estate, not an exact accounting. Your attorney will be able to advise and guide you on obtaining an accurate picture of your entire estate but this list will be the foundation for future calculations.

Life Insurance Policies

Life insurance is a common tool people use to guarantee their surviving family won’t be left in an untenable financial position in the event of death. The lump sum that life insurance proceeds guarantee can fill critical gaps in an estate plan and ensure that your loved ones are taken care of and your affairs are handled in a respectable manner. This is only possible, however, if the proper beneficiaries are designated. If not, who knows how your proceeds are spent. Therefore, ensuring the proper beneficiaries are denoted and/or updated on your insurance policies is of utmost importance. Make sure to have your attorney review your beneficiaries and file any change of beneficiary forms you desire.

Of further note for seniors, some life insurance policies, such as whole life or universal, accrue cash value which may affect Medicaid eligibility. The accumulation of cash value under particular life insurance policies counts as an asset, which if exceeds $2,000 may disqualify a person from Medicaid. Again, this is something to bring to your attorney’s attention so your estate plan can be more personalized to your needs.

Additionally, life insurance policies are often part of your taxable estate. As such, proper steps during estate planning must be undertaken to lower or avoid the tax burden on the estate. Named beneficiaries of life insurance proceeds may also face significant tax consequences from a sudden influx of cash. As such, bringing your life insurance policies to your estate attorney allows him to understand the type of insurance you possess and avoid issues with regard to beneficiary designations, Medicaid eligibility, and estate tax consequences.

Investment Portfolio

You’re also going to bring your investment portfolio to your attorney. That is, anything evidencing your 401k, owned annuities, stocks, bonds, or mutual funds, and other retirement accounts such as IRAs and Roth IRAs, regardless of whether the IRS classifies them as qualified or unqualified plans. Your investment portfolio is likely a major asset that is a significant part of your taxable estate and whose constituent parts each often have their own special rules regarding contributions, distributions, transfers, and inheritance. Bringing your investment documents to your attorney will allow him to plan your estate accordingly and inform you of the special rules, privileges, and schedules applicable to the particular investment instruments you’ve chosen.

A List of Important Property with Bequests

Generally, this is what most people think of when talking estate planning, who gets the house and who gets grandma’s heirloom necklace. In order to avoid any conflict and confusion between surviving family members over who gets what when you pass, write out a list of the biggest and most important bequests of personal and real property.

Most people list out vehicles, real estate, business interests, family heirlooms, expensive electronics, art work, etc. Pretty much anything that has high sentimental or financial value. Obviously for each item on the list write who gets what and in what way. For simple property, like jewelry, usually an individual gets a direct bequest and the item is theirs when you pass. For other property, such as real estate or business interests, usually these are split up in particular ways. For example, a business being split equally between surviving children or a house passing only to children of a first marriage. Your attorney will inform you of the multitude of ways bequests may be structured in order to satisfy your particular estate planning needs.

Thinking about and writing out your property bequests ensures your final wishes are followed and avoids familial infighting. On top of bringing this list to your attorney, bring any deeds, titles, or other ownership documents. This will expedite an estate accounting after your death for your executor and makes sure you actually own what you think you do. Far too many times families are taken by surprise by a faulty title or hidden lien or claimant on a deed. Your attorney can easily check a chain of title or confirm the validity of a deed and avoid any question of ownership down the line.

A “Managed Care Plan”

This is not to be confused with the private insurance plan you sign up for, or Ohio picks for you, when you apply and are approved for Medicaid. Managed care plans within the context of Medicaid private insurance isn’t the subject here, however, it is an important subject that should be discussed and planned for with your attorney.

Within this context, your managed care plan means a coherent idea of where and how you want to spend the last years of your life, especially in the event of deteriorating health or debilitating disease. That is, the logistics, finances, and questions surrounding issues of hospice care, managed care facilities, nursing homes, and general living as one advances in age.

For example, planning out your senior living situation will likely enable you to stay with your primary care physician and specialists longer. Often the accessibility of physicians and medical specialists are subject to geographic restriction, insurance coverage, or out-of-pocket cost. A proper estate plan can guarantee the funds exist to support continued care in the manner you’ve grown accustomed to and communicate to friends and family your medical wishes far in advance of when those questions arise. Never underestimate the value of spending the autumn of your years in clean and comfortable healthcare facilities with treatment from doctors that have an established relationship. As such, bring any contracts, agreements, or marketing materials of any health or senior living facilities you wish to go to. Every piece of information allows further personalization of your estate plan and more clearly communicates what you want to your family many years down the road.

Further, bring important legal documents such as designations for durable, health, or financial powers of attorney, any do not resuscitate orders (DNRs), and executor and administrator elections. If you don’t have any of these documents prepared, these can easily be drafted by your attorney during your estate planning.

Americans are living longer than ever before and having a plan to confront advancing age is important to ensure comfortable living and piece of mind for the family. Granted this is not an enjoyable or fun aspect of life to think about and plan out, but it is something you and your family will never regret.

Conclusion:

Bringing the listed documents and gathering up your thoughts according to the issues highlighted will give you a good head start in preparation to planning your estate with your attorney. Again, this list is not exhaustive and only touches on a fraction of the issues that addressed during estate planning. Major issues such as surviving spousal support and guardianship of minor children, among many others, must be handled too, so think about these issues as well. Estate planning is a complex process but taking a little time to gather documents and think about the future will pay big dividends to you while you’re here and make life much easier for your family when you’re not.

You don’t have to be rich to protect what you’ve spent a lifetime trying to build. To find out whether a trust is right for your family, take the one-minute questionnaire at www.DoIneedaTrust.com. There are a number of different trusts available and the choices are infinite. With every scenario, careful consideration of every trust planning strategy should be considered for the maximum asset protection and tax savings.

For more information, you can contact Dan A. Baron of Baron Law LLC at 216-573-3723. Baron Law LLC is a Cleveland, Ohio area law firm focusing on estate planning and elder law. Dan can also be reached at dan@baronlawcleveland.com.

Helping You and Your Loved Ones Plan for the Future.

About the author: Mike E. Benjamin, Esq.

Mike is a contracted attorney at Baron Law LLC who specializes in civil litigation, estate planning, and probate law. He is a member of the Westshore Bar Association, the Ohio State Bar Association, the Cleveland Metropolitan Bar Association, and the Federal Bar Association for the Northern District of Ohio. He can be reached at mike@baronlawcleveland.com.

Disclaimer:
The information contained herein is general in nature, is provided for informational and educational purposes only, and should not be construed as legal or tax advice. The author nor Baron Law LLC cannot and does not guarantee that such information is accurate, complete, or timely. Laws of a particular state or laws that may be applicable in a given situation may impact the applicability, accuracy, or completeness of the preceding information. Further, federal and state laws and regulations are complex and subject to change. Changes in such laws often have material impact on estate planning and tax forecasts. As such, the author and Baron Law LLC make no warranties regarding the herein information or any results arising from its use. Furthermore, the author and Baron Law LLC disclaim any liability arising out of your use of, or any financial position taken in reliance on, such information. As always consult an attorney regarding your specific legal or tax situation.
“He who is always his own counselor will often have a fool for his client.” Old English Proverb est. circa 1809.
Estate Planning Lawyer - Daniel A Baron

Qualified Personal Residence Trusts

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Cleveland, Ohio, estate planning lawyer, Daniel A. Baron, Ohio, offers the following information on whether a Qualified Personal Residence Trust should be part of your comprehensive estate planning.

For wealthier families, a great tool to manage your future tax savings would be to transfer the liability of owning a property for which you may end up paying estate taxes on, to a Qualified Personal Residence Trust, or QPRT.

In 2017 the gift exemption was set at $5.49 million, therefore, creating a QPRT permits you to make better use of this exemption. This allows anyone with a substantial estate and the likelihood of facing future transfer taxes, the opportunity to place a residence, be it a primary home, a secondary home, lake, mountain, or ocean side getaway, in a QPRT.  Transferring of this property is a lifetime transfer of residence in exchange for a rent free use of the home for the entire term of the trust.  Should the grantor survive the term of the trust, the property can either remain in the trust for the benefit of the beneficiaries or transfer outright to the beneficiaries.  Either way, successfully establishing a QPRT reduces the gift tax or estate tax cost.

You must keep in mind that this a federal tax exemption and some states may still impose a tax on the value of the property, but it still remains a great tool to maximize your estate taxes upon your passing.

Frequently asked Questions:

  • When should I utilize a QPRT
  • What requirements need to be met to qualify a property for the QPRT tax reduction
  • Does a mortgage impact the QPRT transfer
  • Are there any tax consequences connected with a QPRT

To see whether or not a Qualified Personal Residence Trust is the right estate tax savings plan for you, contact an experienced Estate Planning lawyer. Contact Daniel A. Baron of Baron Law today at 216-573-3723 to answer any questions you may have on a QPRT or any other trust.  We welcome the opportunity to work with you recommending the best solution for your needs.

Helping You and Your Loved Ones Plan for the Future

Daniel A Baron Estate Planning Lawyer

Irrevocable Life Insurance Trust – Is It Right For You?

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Cleveland, Ohio, Estate Planning lawyer, Daniel A. Baron, of Cleveland, Ohio, offers the following information on establishing an Irrevocable Life Insurance Trust (ILIT). Is it the right fit for you when creating your estate plan?

When you think about life insurance, you typically are going to use this as a vehicle to plan for the possibility of passing away while still having loved ones to support. What kinds of expenses do you look to cover after you pass?

  • Mortgage expense
  • Children’s future education
  • Credit card debt
  • Vehicle loans
  • Funeral costs
  • Your spouses’ daily needs
  • Your children’s daily needs
  • Spouse and children’s health needs
  • Etc.

You may want to consider creating an Irrevocable Life Insurance Trust (ILIT).   Quite simply this is another tool to maximize your estate tax savings while still giving you the benefits of insurance coverage.  As the name states this is an irrevocable trust so you cannot remove this policy from the trust at a later date and have it revert to your personal name.  You do maintain control over it as far as naming the Trustees and the Beneficiaries and changing them at any time in the future if the need arises.

As mentioned this would serve as a great way to maximize your tax liability upon your death. Keeping in mind that when you pass away and insurance company sends your check to you, the government is waiting for their share of the funds.  So the benefits of putting your life insurance policy in the Trusts name:

  • Reduces the size of your estate, therefore reducing your tax liability
  • You can consider reducing the amount of coverage since you will not have to guard against the tax hit thus savings you insurance premium dollars
  • The cash value of the policy is protected against creditors
  • If your spouse, children, or other named beneficiaries are receiving any government aid such as Medicaid, this helps protect the benefits your beneficiaries are receiving

To see whether or not an Irrevocable Life Insurance Trust is the best fit for your tax planning situation, you need to speak with an experienced Estate Planning lawyer. Contact Daniel A. Baron of Baron Law today at 216-573-3723 to answer any questions you may have on a creating an ILIT.  I welcome the opportunity to work with you and recommending the best solution for your needs.

Helping You and Your Loved Ones Plan for the Future

Estate Planning Lawyer - Cleveland Ohio - Baron Law LLC

Do I need a Trust?

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Exploring whether you need a trust may be answered below visiting this questionnaire: DoIneedaTrust.com.   In addition, you may find the following information written by Cleveland, Ohio estate planning lawyer Daniel A. Baron useful.

Even if your name isn’t Bill Gates or Warren Buffet, it does not necessarily mean that the need for you to establish a trust does not exist. If your Net Worth is greater than $100,000* and you have very specific desires as to how you would like to disperse your assets after you pass away, you should consider creating a trust.  Although you would have a will in place as well, by establishing a trust you will maximize your tax benefits.  In addition this will also protect your assets from creditors and ensure that your heirs receive the items you would like to pass onto them.  This not only pertains to liquid assets such as cash and your investments but property as well.

There are a number of different trusts available to you to create which can protect your assets and minimize your estate taxes at the end. Each of us has our own needs when it comes to protecting our assets for the next generation and to make sure that your wishes are followed after your passing.

Some of the different types of trusts you may want to discuss to see what best suits your needs:

  • Revocable
  • Irrevocable
  • Credit Shelter / A-B Trust
  • Generation Skipping
  • QPRT
  • Irrevocable Life Insurance Trust
  • Children’s Trust
  • Medicaid Trust
  • Life Estate Trust
  • Medicaid Asset Protection Trust
  • Intentional Defective Grantor Trust

To see what trust is best suited for you, contact an Estate Planning Lawyer. These are some of the topics you should be prepared to discuss:

  • Do your investments name a beneficiary or do they have a POD (payable on death) or a TOD (transfer upon death) form attached to them?
  • Do you have a child with special need that you need to have cared for after your passing?
  • Do you own any real estate out of state?
  • Do you have a unique plan of how you would like your estate divided?

*To determine your Net Worth take the sum of your total assets (cash, property, investments, etc.) and subtract your total liabilities (mortgage balance, credit card debt, etc.). Plain and simple take what is OWNED and subtract what is OWED.

To get answers to your questions as to what type of trust is best suited for your specific needs you should speak with an experienced Estate Planning lawyer. Contact Daniel A. Baron of Baron Law today at 216-573-3723 to answer any questions you may have on creating your trust.  We welcome the opportunity to work with you and recommending the best solution for your estate planning needs.

Helping You and Your Loved Ones Plan for the Future

 

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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

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.

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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:

Baron Law Estate Planning Attorney

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.