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We provide The Elder Law Update to our clients and our colleagues who make up a wide range of service providers for seniors and people with disabilities to facilitate the dissemination of helpful and accurate information. We thank you for letting us share our knowledge with you. We welcome your comments and questions. You may send them to Info@ElderLawAssociates.com. |
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Living Trusts for those with Chronic Illnesses
by Martin M. Shenkman, CPA, MBA, PFS, AEP, JD
 Although revocable living trusts are nearly ubiquitous in estate planning, their typical use is to minimize ancillary probate or to avoid probate entirely. Whatever the merit and value of these applications, a properly crafted and planned revocable trust can be an indispensable technique to provide a protective financial and personal shield for the large and growing number of clients facing the challenges of a chronic illness, disability, or other health issue. The statistics demand that practitioners give greater attention to tailoring whatever planning and documentation that they normally would create with revocable trusts to the specific needs of clients facing these challenges.
Read on ... |
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3d DCA: Florida's new Power of Attorney statutory regime makes its appellate court debut... the reviews are good
By: Juan Antunez
Florida Probate & Trust Litigation Blog
Rosenkrantz v. Feit, --- So.3d ----, 2011 WL 6183525 (Fla. 3d DCA Dec 14, 2011)
 As I reported here, on October 1, 2011 Florida overhauled its power of attorney (POA) statutory regime based in large part on the Uniform Power of Attorney Act. The new statute was supposed to clarify some of the ambiguities inherent to the old statute.
Based on the 3d DCA's observations in this case, the new statute appears to be delivering on this front.
Less ambiguity = greater certainty for anyone seeking legal advice about POA's and what their rights, duties or obligations as an attorney-in-fact may be. Win, lose or draw, certainty in the law is always a good thing.
Case Study:
In this case an elderly mother executed a POA naming her two children as her co-attorneys-in-fact. As long as everyone does their part, naming two children in your POA as co-attorneys-in-fact is OK and done all the time. Unfortunately, in this case one of the siblings (Sister) believed her brother was improperly blocking her attempts to account for their mother's assets. What to do? Given the ambiguities inherent to the old statute, the answer was unclear. Bottom line, Sister was compelled to invest valuable time and money into filing a declaratory judgment action just to figure out who was supposed to do what under her mother's POA. On appeal, the legal issue was whether a declaratory judgment action was appropriate in this case. The 3d DCA said yes. The 3d DCA then went out of its way to point out how the ambiguities giving rise to Sister's declaratory judgment action in the first place have now been largely resolved by our new POA statutory regime. Less ambiguity = greater certainty= less time and money wasted on declaratory judgment actions. That's a good thing.
Here's an excerpt from the 3d DCA's opinion:
Gertrude Feit executed a Durable Power of Attorney when she began having memory loss. Gertrude named her daughter, Rosenkrantz, and her son, James Feit, as attorneys-in-fact to oversee her financial affairs. Gertrude and James live in Miami-Dade County, Florida. Rosenkrantz, who lives in New York, alleges that her brother refuses fully to account for their mother's assets, and objects to her efforts to obtain information directly from the financial institutions. Rosenkrantz contends that James' actions impair her ability to carry out her responsibilities as a co-attorney-in-fact, and she is in doubt as to her rights under the power of attorney. ***** Rosenkrantz thus sought declaratory relief to determine: 1) the extent to which she can, as a co-attorney-in-fact, act without the concurrence of a co-attorney who may be acting in derogation of his fiduciary duty; and 2) whether she, as one co-attorney, is entitled to an accounting from the other co-attorney. If the allegations are proven as pled, it is clear that Rosenkrantz acted properly and prudently in seeking to fulfill her fiduciary role.FN2 . . . FN2. It should be noted that the Florida Legislature addressed these very issues in its 2011 revisions to Chapter 709. Among the several significant changes, the new statutory scheme provides: - A principal may designate two or more persons to act as co-agents, and unless the power of attorney otherwise provides, each co-agent may exercise its authority independently. § 709.2111(1), Fla. Stat. (2011). - If a power of attorney requires that two or more persons act together as co-agents, one or more of the agents may delegate to a co-agent the authority to conduct banking transactions pursuant to the power of attorney. § 709.2111(6). - An agent may be required by a co-agent to disclose receipts, disbursements, or transactions conducted on behalf of the principal. § 709.2114(6). - An agent (including a co-agent) may petition a court to construe or enforce a power of attorney, review the agent's conduct, terminate the agent's authority, remove the agent, and grant other appropriate relief. §709.2116(1). - An agent's exercise of power may be challenged in a proceeding brought on behalf of the principal on the grounds that the exercise of the power was affected by a conflict of interest. § 709.2116(4).
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Judge Deals Blow to Advocates for Old, Disabled
 WEST PALM BEACH (AP) - A federal judge struck a blow Tuesday to advocates for the elderly and disabled, removing class-action status from a lawsuit that had argued Florida illegally forces people into nursing homes when they are capable of living elsewhere.
U.S. District Judge Robert Hinkle ruled in favor of one of the institutionalized Medicaid patients who sued the state of Florida in 2008, saying they should be allowed to live in other settings. But by removing the suit's class status, the ruling applies to just one person, Clayton Griffin, instead of the 8,500 plaintiffs estimated by attorneys to be in a similar situation.
Read on ... |
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IRS Issues Long-Term Care Premium Deductibility Limits for 2012
 The Internal Revenue Service (IRS) is increasing the amount taxpayers can deduct from their 2012 taxes as a result of buying long-term care insurance.
Premiums for "qualified" long-term care insurance policies (see explanation below) are tax deductible to the extent that they, along with other unreimbursed medical expenses (including Medicare premiums), exceed 7.5 percent of the insured's adjusted gross income.
These premiums -- what the policyholder pays the insurance company to keep the policy in force -- are deductible for the taxpayer, his or her spouse and other dependents. (If you are self-employed, the tax-deductibility rules are a little different: You can take the amount of the premium as a deduction as long as you made a net profit; your medical expenses do not have to exceed 7.5 percent of your income.)
However, there is a limit on how large a premium can be deducted, depending on the age of the taxpayer at the end of the year. Following are the deductibility limits for 2012. Any premium amounts for the year above these limits are not considered to be a medical expense.
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Attained age before the close of the taxable year |
Maximum deduction for year | |
40 or less |
$350 | |
More than 40 but not more than 50 |
$660 | |
More than 50 but not more than 60 |
$1,310 | |
More than 60 but not more than 70 |
$3,500 | |
More than 70 |
$4,370 |
What Is a "Qualified" Policy?
To be "qualified," policies issued on or after January 1, 1997, must adhere to certain requirements, among them that the policy must offer the consumer the options of "inflation" and "nonforfeiture" protection, although the consumer can choose not to purchase these features. Policies purchased before January 1, 1997, will be grandfathered and treated as "qualified" as long as they have been approved by the insurance commissioner of the state in which they are sold. For more on the "qualified" definition, click here.
The Georgetown University Long-Term Care Financing Project has a two-page fact sheet, "Tax Code Treatment of Long-Term Care and Long-Term Care Insurance." To download it in PDF format, go to: http://ltc.georgetown.edu/pdfs/taxcode.pdf
(If you do not have the free PDF reader installed on your computer, download it here.) |
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Living Past 90: Five Palm Beach County Residents Describe What It's Like
By Barbara Marshall
Palm Beach Post Staff Writer
"Who dies at 70? It's so old-fashioned."
- Jerry Seinfeld
Charlotte Stern is impatient, fidgeting in her chair, looking at her watch.
"How long will this take?," asked Stern, who is 95. "I'm sorry but I don't have much time."
You're never sure how to take a comment like that when the speaker is closing in on the century mark.
I was visiting The Tradition of the Palm Beaches retirement community in West Palm Beach to meet five residents whose odometers had all rolled past the 90-year mark. I wanted to know what it's like to have lived that long because, according to the Census Bureau, a lot more of us than ever before are going to find out.
The number of Americans reaching the 90-year mark is expected to more than quadruple by 2050, to 9 million.
Currently, there are 1.9 million Americans 90 or older.
Surely the residents would have plenty of time to chat. It wasn't as if they had jobs, right?
Stern, a no-nonsense woman with a blond bouffant wearing a white track suit jacket, set me straight.
"I have to be at work in about 30 minutes," said Stern briskly. She volunteers at two gift shops, getting there with the assistance of a wheeled walker.
She wasn't the only one with a full calendar.
It was her day off, or Esther Bandareff, 96, would be on duty at the Palm Beach Zoo, where she gives regular tours, sometimes with a snake wrapped rakishly around her neck.
"We have a new Florida pine snake that was quite aggressive, but I'm calming him down," said Bandareff, who also cleans reptile and bird cages at the zoo, where she has been a volunteer for 24 years.
Could 90 be the new 70?
Not for many old people, burdened by illness and poverty.
But it may be for a growing number who remain healthy and vital at advanced ages.
So many people are celebrating their 90th birthdays that the Census Bureau is contemplating moving the marker for the "oldest old" forward from 85 to 90.
"Because of increasing numbers of older people and increases in life expectancy at older ages, the oldest segments of the older population are growing the fastest," said Richard Suzman of the National Institute on Aging at the National Institutes of Health.
So what is 90 like?
Busy, if this group is any example.
"When I'm not in the gym, I'm out walking," said Belle Roberts, who is 100, but who could easily pass for 75. "I walk every day for 30 minutes, sometimes an hour, although I use a walker now."
Roberts, who worked until she was 83, does two crossword puzzles a day, "and I always have a jigsaw puzzle going."
Last year, at age 99, the ardent world traveler took a road trip with her daughter, from Florida to Maryland to Chicago, visiting family along the way.
"My mother's favorite saying was 'Take from life what you can.' I tell people, 'Just go,' " said Roberts, who has followed her own advice for a century, taking dozens of European trips.
Warns Harriet Segal, 98, once known as "the Yiddish voice of Boston," "If you don't have a zest for life at 50, you're not going to have it at 90."
A writer, teacher and radio announcer who worked full-time until she was 72, Segal is the image of zestiness, who still tapes a regular radio segment from her home office to send to a Boston station.
"If your mind is occupied, you're still engaged in life," said Segal, who was finishing a Hanukkah story she was writing for The Tradition's newsletter.
Bandareff, another enthusiastic traveler and the only one of the group who still drives, has been to all seven continents, including a visit to Antarctica in her late 80s.
She laments her declining energy, but said, "I've never had time to think about being old. I've always stayed busy," she said. Next summer, she expects to attend her 75th reunion at Cornell University.
The need for staying physically and mentally active is a theme this group repeated again and again.
"The secret to a long life is getting up in the morning and knowing I have something to do," said Stern.
They try not to dwell on health problems.
"I don't want my children to feel sorry for me," Stern said.
Said Roberts, "I don't have anything to feel sorry about. I have things to be thankful for," listing her large family first.
Nearly 101, she finds less and less to worry about.
"I see the headlines and pass them by. They don't concern me anymore," she said.
Asked what makes her happy now that she's edged past the century mark and she shoots back, "It's the wrong question. It's not so much about being happy, but being content."
Content with her life. Content being alone.
All five in this group have lost spouses, siblings, too many friends.
The baby of the group, Philip Klein, is a 91-year-old widower whose wife died two years ago, followed two days later by Klein's brother.
"I thank God I was able to reach this age, but it's a hard thing to be alone. Most of my friends are gone now."
He pauses then sighs.
"You have to learn to take the punches."
A dash of feisty outrage helps, too.
Segal rails against people who presume wrinkles on the face portend failing faculties in the brain.
"In a crowd no one will speak to the elder people," said Segal, who recounted the sale of her car a few years ago. The man who bought it "only talked to my daughter, he never once looked at me. It's the same with one of my doctors. It's as if we're not there."
But they are here, more of them every day.
And if we're lucky - and stay busy - we will walk in their non-skid-soled shoes one day. |
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Medicare Beneficiaries: Make Sure Your Equipment Supplier Works With Medicare
 In October, Medicare beneficiary David P. (not his real name), was shocked to see a charge of more than $1,000 on his credit card statement. The charge was for the complete cost of renting a machine he needed to help him recover from knee replacement surgery. The equipment is covered by Medicare, so Mr. P. thought he would be responsible only for his 20 percent co-payment.
But it turns out that the equipment supplier who rented him the machine never informed him that it is not a registered Medicare provider and that therefore Mr. P. may be responsible for the full cost of the rental.
"It is a problem that beneficiaries often do not know that they are using a non-participating supplier," says Alfred J. Chiplin, Senior Policy Attorney at the Center for Medicare Advocacy and co-author of The Medicare Handbook (Wolters Kluwer).
The good news is that Chiplin says a new Medicare program that has been launched in a few areas of the country will keep people like Mr. P. from unwittingly being liable for the full cost of such "durable medical equipment (DME)," which includes oxygen equipment, wheelchairs, walkers, and similar devices.
In the few areas of the country with the new program, which is called the "Medicare DMEPOS Competitive Bidding Program," Medicare beneficiaries who expect any reimbursement may rent or buy certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) only from suppliers who contract with Medicare. In addition, non-contracting suppliers are required to tell Medicare beneficiaries that they don't work with Medicare and the beneficiaries must sign a waiver form stating they are aware of this. If the supplier fails to do this, the beneficiary is not liable for the charge.
Chiplin told ElderLawAnswers that equipment suppliers in the DMEPOS program areas are getting better at providing Medicare beneficiaries with the required notice that they are not contracting providers, and he says Medicare is stepping up its fraud and sanctions activity. (For more on the DMEPOS program, click here. To see if your zip code is in a coverage area, click here.)
Seek Medicare Reimbursement Anyway
But in the vast majority of the country not currently covered by the DMEPOS program, it is unclear whether suppliers who don't work with Medicare are under any obligation to alert Medicare beneficiaries of this fact. The best defense, then, is for beneficiaries to always make certain the supplier has a relationship with Medicare - something Mr. P. had no idea he should do.
If you are caught in the situation Mr. P. found himself in, you can submit your bill from the supplier and seek as much reimbursement as you can get, Chiplin says. (Mr. P. is still awaiting word from Medicare.)
"Once the DMEPOS program is fully implemented, beneficiaries should experience a greater reduction in DME out-of-pocket expenses as they will be required to use certified and registered DMEPOS providers in order to obtain Medicare-covered items," Chiplin says.
"It's always best for beneficiaries to use certified suppliers and those who are Medicare participating suppliers," Chiplin counsels. |
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When Should You Update Your Estate Plan?
 Once you've created an estate plan, it is important to keep it up to date. You will need to revisit your plan after certain key life events.
Marriage
Whether it is your first or a later marriage, you will need to update your estate plan after you get married. A spouse does not automatically become your heir once you get married. Depending on state law, your spouse may get one-third to one-half of your estate, and the rest will go to other relatives. You need a will to spell out how much you wish your spouse to get.
Your estate plan will get more complicated if your marriage is not your first. You and your new spouse need to figure out where each of you wants your assets to go when you die. If you have children from a previous marriage, this can be a difficult discussion. There is no guarantee that if you leave your assets to your new spouse, he or she will provide for your children after you are gone. There are a number of options to ensure your children are provided for, including creating a trust for your children, making your children beneficiaries of life insurance policies, or giving your children joint ownership of property.
Even if you don't have children, there may be family heirlooms or mementos that you want to keep in your family. For more information on estate planning before remarrying, click here.
Children
Once you have children, it is important to name a guardian for your children in your will. If you don't name someone to act as guardian, the court will choose the guardian. Because the court doesn't know your kids like you do, the person they choose may not be ideal. In addition to naming a guardian, you may also want to set up a trust for your children so that your assets are set aside for your children when they get older.
Similarly, when your children reach adulthood, you will want to update your plan to reflect the changes. They will no longer need a guardian, and they may not need a trust. You may even want your children to act as executors or hold a power of attorney.
Divorce or Death of a Spouse
If you get divorced or your spouse dies, you will need to revisit your entire estate plan. It is likely that your spouse is named in some capacity in your estate plan -- for example, as beneficiary, executor, or power of attorney. If you have a trust, you will need to make sure your spouse is no longer a trustee or beneficiary of the trust. You will also need to change the beneficiary on your retirement plans and insurance policies.
Increase or Decrease in Assets
One part of estate planning is estate tax planning. When your estate is small, you don't usually have to worry about estate taxes because only estates over a certain amount, depending on current state and federal law, are subject to estate taxes. As your estate grows, you may want to create a plan that minimizes your estate taxes. If you have a plan that focuses on tax planning, but you experience a decrease in assets, you may want to change your plan to focus on other things. For more information about estate taxes, click here.
Other
Other reasons to have your estate plan updated could include:
- You move to another state
- Federal or state estate tax laws have changed
- A guardian, executor, or trustee is no longer able to serve
- You wish to change your beneficiaries
- It has been more than 5 years since the plan has been reviewed by an attorney
Contact us to update your plan. |
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A Letter of Instruction Can Spare Your Heirs Great Stress
 While it is important to have an updated estate plan, there is a lot of information that your heirs should know that doesn't necessarily fit into a will, trust or other components of an estate plan. The solution is a letter of instruction, which can provide your heirs with guidance if you die or become incapacitated.
A letter of instruction is a legally non-binding document that gives your heirs information crucial to helping them tie up your affairs. Without such a letter, it can be easy for heirs to miss important items or become overwhelmed trying to sort through all the documents you left behind. The following are some items that can be included in a letter:
- A list of people to contact when you die and a list of beneficiaries of your estate plan
- The location of important documents, such as your will, insurance policies, financial statements, deeds, and birth certificate
- A list of assets, such as bank accounts, investment accounts, insurance policies, real estate holdings, and military benefits
- Passwords and PIN numbers for online accounts
- The location of any safe deposit boxes
- A list of contact information for lawyers, financial planners, brokers, tax preparers, and insurance agents
- A list of credit card accounts and other debts
- A list of organizations that you belong to that should be notified in the event of your death (for example, professional organizations or boards)
- Instructions for a funeral or memorial service
- Instructions for distribution of sentimental personal items
- A personal message to family members
Once the letter is written, be sure to store it in an easily accessible place and to tell your family about it. You should check it once a year to make sure it stays up-to-date. |
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Social Security's Benefits for Spouses
 Social Security doesn't just pay retirement benefits to retired workers; in some circumstances, it also provides benefits to a worker's spouse or ex-spouse and to a deceased worker's surviving spouse. Here are the ins and outs of spouse and survivor benefits.
Spousal Benefits
Spouses are entitled to benefits if the marriage lasted at least 10 years. A spouse is entitled to an amount equal to one-half of the worker's full retirement benefit. To receive this benefit, you must be at your full retirement age or caring for a child who is under 16 years old. In addition, your spouse must have filed for Social Security retirement benefits even if he or she isn't receiving them.
If you could receive more from Social Security based on your own earnings record than through the spousal benefit, the Social Security Administration will automatically provide you with the larger benefit. If you have reached your full retirement age, you may also elect to receive spousal benefits and delay taking your benefits, allowing your own delayed retirement credits to accrue, and switch to your own benefit at a later date. However, you cannot elect to receive spousal benefits below your retirement age and later switch to your own benefits.
If you begin collecting your spousal benefit before your full retirement age, your spousal benefit will be permanently reduced. But if your spouse retires early, but you wait until your full retirement age, you will still receive benefits based on one-half of his or her full retirement benefit.
For more from the Social Security Administration on spousal benefits, click here.
Divorced spouses
An ex-spouse is also entitled to receive one half of the worker's full retirement benefit as long as the marriage lasted at least 10 years. Unlike a current spouse, a divorced spouse can begin receiving benefits even before the worker has applied for benefits. The worker must be at least 62 years old and the divorce must have been final for at least two years.
For more from the Social Security Administration on qualifying for divorced spouse benefits, click here.
Survivor Benefits
If you are a surviving spouse at full retirement age, you are entitled to the worker's full retirement benefits. If the worker delayed retirement, the survivor's benefit will be higher. Survivors are entitled to benefits even if they are divorced as long as they had been married for at least 10 years. If you file for benefits before you are over age 60, but below full retirement age, you will receive a reduced percentage of the worker's benefits. Surviving spouses who are younger than 60 receive benefits only in limited circumstances, such as cases of disability or caring for a disabled child.
For more from the Social Security Administration on the requirements for survivor benefits, click here.
For more information on Social Security, click here. |
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Elder Law Associates PA is a boutique elder law firm that practices exclusively in Medicaid and long term care planning including long term care insurance, Medicaid applications, home and community-based Medicaid waiver services, diversion program benefits, nursing home benefits, spousal refusal applications, and Medicaid fair hearings and appeals; nursing home and assisted living facility residents' rights litigation; asset preservation planning with a special focus on planning in light of the Deficit Reduction Act of 2005, including personal service agreements, the purchase of life estates, income producing real estate and spenddown planning; disability planning, including special needs trusts and guardianship; estate planning, including wills and trusts and advance directives; and probate, which encompasses estate and trust administration as well as litigation.
We assist clients in planning for the possibility of disability, incapacity, home health care, assisted living and/or nursing home placement. Our firm enables clients to avoid impoverishment caused by the escalating cost of long term care, to maintain their right to make health care decisions and to avoid unnecessary medical treatment.
We hope you have enjoyed The Elder Law Update. If you have questions about something you read, elder law matters or issues concerning persons with disabilities, we would be delighted to hear from you. We serve as an elder law resource to many professionals and organizations and want to become your elder law resource as well. You can reach us at Info@ElderLawAssociates.com.
Warm regards, |
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Ellen S. Morris, Esq. & Howard S. Krooks, Esq., CELA, CAP
Elder Law Associates PA
phone: (561) 750-3850 / (800) 353-3752
fax: (561) 750-4069
This publication is intended for general information purposes only. It is not intended to constitute individual legal advice to any specific client. |
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