15 Most Commonly Asked Questions About Elder Law

Do I need a will?

Yes. A Will directs the distribution of your assets and puts someone in charge of your estate. The cost of the Will is made up in the bond waiver provision alone.

Do I need a trust?

If you have substantial assets or other complicating factors then you should consider a trust. A trust is private and can result in substantial tax savings. This is a complicated question and the answer depends on your individual circumstances. "One size does not fit all." For further information refer to the "Do I need a Trust" brochure.

What is a trust?

A trust is a mechanism for managing money and assets. It is durable and will continue for years. It is created by a lengthy document and by the transfer of assets into the trust.

What is a "living will"?

This is a document that directs your health care. It has been replaced by a Health Care Declaration. A Health Care Declaration allows you to plan the direction of your health care and appoint someone to carry out your directions. It is a better document than the "living will" form.

What is a "Power of Attorney"?

A power of attorney allows someone else to act for you in financial matters.

Do I need a Power of Attorney?

This is a very important and useful document. However, Powers of Attorney can be abused. A power of attorney should only be given to a person who you are certain is honest and responsible.

What is a "Health Care Power of Attorney"?

This is a document that allows another to make health care decisions for you. It is incorporated into our Heath Care Declaration. This is a short and concise document.

What about Taxes?

The federal estate tax threshold is currently 3.5 Million. A Federal Estate Tax Return must be filed if the estate is over 2 Million. If the Minnesota assets are over One Million dollars, then a Minnesota Estate Tax Return must be filed. In planning you must also consider capital gains and income tax consequences. These taxes affect more people than the Estate taxes.

What if I end up in a Nursing Home?

We have the current regulations on medical assistance planning and we can guide you through the spousal impoverishment rules and the asset limitation/ transfer rules. These rules change every year.

Should I put my kids names on my house?

The short answer is no - unless that child resides there too. This is an idea that works for some people in some situations but also may backfire. We have a brochure that addresses this topic.

How can I avoid Probate?

You can avoid probate through the creation of a trust and beneficiary designations - but in a rush to avoid probate, people often make other mistakes. Probate can be as simple or as complicated as people make it. Nothing can absolutely prevent a matter from being dragged into court - even a trust can be put under the jurisdiction of the court. Carefully drafted documents help a lot to minimize conflict and avoid or reduce court involvement. The probate procedure and associated costs vary from state to state. Minnesota is a uniform probate code state.

How can I avoid Taxes?

A trust will help for large estates- but this question does not have a simple answer. You will need to consult with your attorney and a certified public accountant.

Do I need to see a Lawyer?

Absolutely - there is an old English Poem that "a Lawyer's best friend is the testator who makes his own will." "so we'll send 'round the wine and a light bumper fill to the jolly testator who makes his own will." I can cite a number of cases where people incurred thousands of dollars in un-necessary costs because the decedent tried to do it himself. In one case, we had three hearings for the court to decide the meaning and validity of a lady's homemade will. If you have property in more than one state, then you probably should see a lawyer in both places.

Do I need to review and update my "estate plan"?

Yes, because your circumstances may have changed and the law changes. If we could predict the future, we could do one plan and one set of documents that would last forever. Unfortunately, even a carefully drafted plan can become obsolete because of a change in circumstances or laws.

How should I invest my money?

You should seek the advise of a competent investment advisor from a reputable company. Lawyers are not trained as investment counselors (and investment counselors are not trained as lawyers.). I suggest that you get someone who has been around for a while. Time has a way of sorting out those who are dishonest or incompetent. "If it sounds too good to be true - it probably is."

These questions and answers were prepared by Bruce L. Beck, a Minnesota Lawyer experienced in Elder Law. They are short and simple and are not intended as legal advice but only for a basis for further discussion and consultation. Please call for an appointment so we can thoroughly discuss the issues raised in this publication. You also should consult with an accountant and a competent financial adviser.