Life Estate Deeds – An Antique Technique Providing Modern Convenience

October 16, 2014

Filed under: Estate Planning,Financial,Uncategorized — Tags: , — Alexis @ 9:30 AM

When we pass away, our assets are divided into two groups – probate and non-probate. Non-probate assets are things like bank accounts and life insurance policies that you have named joint owners or TODs on – they transfer to the named beneficiaries upon your death without any court involvement. Probate assets are held only in your name. The court looks to your will, or the intestacy statute, if there isn’t a will, to determine who receives these assets. This can be a lengthy, and potentially costly, process.

 

One way to make your home a non-probate asset is to create a life estate. This concept was borrowed from old English property law. You, as the owner of the home, deed the home to yourself for life (making you the “life tenant”) and then to another person(s) known as the “remainderman” (most often your children). Upon your passing, the remaindermen immediately become the owners of the home (they just need to file a copy of your death certificate with the Registry of Deeds).

 

Creating a life estate has many benefits. First, upon your passing, your home transfers seamlessly to the remaindermen without any court involvement. Second, you are guaranteed the right to remain in your home for the rest of your lifetime – you cannot be compelled to sell or move out. Next, after your passing, the remaindermen receive a step-up basis for capital gains purposes, minimizing the capital gains tax due should they decide to sell the property after your death. Fourth, because the remaindermen have no ownership interest in the home until after your death, their creditors (in the event of a bankruptcy or divorce, for example) cannot access the equity in the home during your lifetime. Lastly, the entire value of the home can be protected from your nursing home costs so long as the life estate is created at least five years before you ask MassHealth for assistance in paying for nursing home care (more on this below).

 

Creating a life estate, however, has its potential pitfalls. First, the remaindermen must all sign off if you decide you want to mortgage, reverse mortgage or sell the property. The thought of giving up so much control can be frightening for many homeowners. (It’s worthwhile to note that your remaindermen should have their own powers of attorney in place, in the event you need their approval and they are out of the country, in the hospital, or otherwise incapacitated.)

 

Also, if you need to ask the state for assistance in paying for nursing home care in the five years following the creation of a life estate, you could be disqualified for a period of time. MassHealth uses a formula to calculate the “value” of your life estate based on your life expectancy and the value of the home. The disqualification can also be cured if the remaindermen agree to deed the property back to the life tenant outright, destroying the life estate. If it’s likely that you’ll be asking MassHealth to help pay for your nursing home care in the next five years, then you should meet with an elder law attorney to explore other options to protect the value of your home to the greatest extent possible.

 

A life estate deed can be a valuable addition to your estate plan. If you’re interested in learning more about life estates and whether this might be the right solution for you, call our office to schedule a planning session.

Home Care Goes High-Tech

October 9, 2014

Filed under: Uncategorized — Alexis @ 9:30 AM

CNN recently ran a fascinating article about the expanding use of technology in the field of home care for seniors with Alzheimer’s and dementia, allowing them to remain independently in their homes longer.

 

You’ve probably heard of “call for help” bracelet or necklace devices, but did you know that a wireless sensor attached to a key fob can text a caregiver if a parent or loved one leaves his or her home? Or that a bedroom motion sensor can monitor sleep interruptions and middle of the night bathroom trips? A company called SmartThings manufactures a variety of sensors, which compile data wirelessly and report back to you via a smartphone app. Stores such as Lowe’s and Home Depot also have their own automated home-monitoring sensor systems.

 

More senior-specific systems include Lively, GrandCare, and BeClose. They offer senior-targeted products such as bathroom and pillbox sensors, and blood pressure and glucose monitoring devices. Reports from these devices can be easily shared with the elder’s doctor. In a nod to social media, caregivers and loved ones can even upload photos and messages using the Lively app, which are printed and sent to the elder via mail twice per month!

 

Of course, even the niftiest of devices can’t replace a caregiver. But these devices can supplement in-home care and enable seniors to remain safely in their homes longer, while giving their families some peace of mind.

 

(Disclaimer: We haven’t used or investigated any of these devices, we are just passing along the information. Before investing in any new device, you may want to do some research, such as reading online reviews or asking friends if they have used them.)

Shared Office Space Available to Lease in Hingham

October 6, 2014

Filed under: Uncategorized — Alexis @ 2:35 PM

Are you a South Shore professional in search of a nice, sunny, 14 x 12 corner office? Our law firm consists of two attorneys and an assistant – we would like to add another professional to our suite. We have a top-floor space that consists of three offices, a spacious conference room, and a waiting area.

 

Clients love the location, right off Route 3 at Exit 15 near the Derby Street Shoppes. The building is handicapped-accessible, with a ramp and an elevator. There is plenty of parking.

 

Rent is $945 per month, which includes heat, electricity, etc. You would just pay for your own phone line, and share the internet cost. The space is available November 1.

 

Doreen, my assistant, is available to greet your clients and make them feel comfortable. She can also provide limited hours of secretarial support, if needed.

 

This is a great space for a solo practitioner, but the office is large enough to have an assistant join you. You do not have to be another attorney – you could be an accountant, a graphic designer, a bookkeeper, a webmaster… any professional who needs a sunlit, spacious office in a conveniently located, modern building.

 

Please contact alexis@alexislevitt.com or doreen@alexislevitt.com for more information.

14 x 12 corner office space.

Sunlit top-floor space.

 

 

Sunlit top-floor space.

14 x 12 corner office.

 

 

 

The Importance of Caregiver Contracts

October 2, 2014

Filed under: Caregiver Issues,Financial — Tags: , , — Alexis @ 12:40 PM

A goal that my clients bring up in meetings time after time is that they wish to stay in their own homes for as long as possible. Many people, however, find the cost of bringing help into their homes to be daunting. Elders are increasingly turning to their adult children for in-home care. As thanks, to reimburse the child for their time and expenses, or a combination of both, elders often wish to “pay” the child. But should the elder need nursing home care in the future, MassHealth will view informal payments as gifts, which could prevent the elder from receiving public assistance. So the question is, what is a family to do?

 

One solution is a “caregiver contract.” This is a written agreement between the elder(s) and their adult children, laying out tasks the child will perform and a rate of pay. Set up along with worker’s compensation and the usual payroll deductions, this provides an income stream to the caregiver while giving the parent what most elders want – being cared for by his or her own family.

 

Caregiver contracts benefit both parties. The caretaker child gets the benefit of worker’s compensation, in addition to reportable, reliable income for state and federal income tax purposes. (You may not think that’s a benefit – but paying taxes can be much better than the consequences of being discovered as delinquent!) The elder gets to remain in his or her home with a familiar caretaker, often at a rate much less expensive than those charged by home health agencies. Should the elder require MassHealth to pay for nursing home care, he or she can prove that the payments were just that – payments – and not gifts.

 

Only an elder law attorney familiar with the ever-changing MassHealth rules should draft a caregiver contract, so that it will protect the elder in the event he or she needs nursing home care in the future. If you believe a caregiver contract would be helpful to you, please do not hesitate to contact my office.