Category: Estate Planning Lawyer

How to Transfer Your Home Without Jeopardizing Your Medicaid Eligibility

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There are many Long-Term Care Medicaid Rules in place which help pay for senior’s care costs. However, it is important for those receiving Medicaid to understand that there is a five year “look back” period where the state can actually penalize an individual from Medicaid eligibility, if there was an uncompensated transfer during this time. This can prevent your application from getting approved.

The good news is, there are ways to transfer your property to someone else, without risking your Medicaid eligibility. These exceptions on home transfers can help you and your family during this time. Here are the primary ways to transfer your property while maintaining your Medicaid eligibility.

Transfer the Home to the Right Family Member

There are a few types of family members you can transfer your property to:

  • You can transfer it to your spouse who already lives in the home.
  • You can transfer the property to a child under the age of 21 or a child who has been determined disabled by the Social Security Administration.
  • You can transfer the property to an adult child who has lived in the home for at least two years before you were institutionalized and provided care that prevented institutionalization. This requires proof by your doctor or social worker that the care was essential.
  • You can transfer the property to a sibling with equity interest in the home and who has lived in the property for one year before your institutionalization.

These transfers will not impact your eligibility for Medicaid. Be prepared to provide proof of residence in these situations.

Transfer Through Deeds

The primary deed we recommend for transfer after death is the Lady Bird Deed. This is an enhanced life estate deed that also avoids Medicaid Estate Recovery. In these situations, the person maintains control of their property during their lifetime, including the power to sell and retain proceeds assuming the Medicaid applicant signs a document stating they intend to return home.

There are also a number of tax issues that you need to be considered first before going with this type of transfer. Depending on your individual situation, the deeds may or may not be the best choice.

If you have questions about how you can transfer your property to a loved one, without risking your Medicaid eligibility, give the attorneys at Hegwood Law Firm a call at (281) 845-8538 to discover your best Medicaid options.

Houston Will Lawyer: Estate Planning Is About Creating Your Legacy

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As a Houston will lawyer, I would like to talk to you today about one of the most overlooked aspects of estate planning – the opportunity to create your legacy.

Believe it or not, creating a legacy is not all about having libraries and hospitals named after you. There are great ways that you can help your family remember your values and beliefs that will cost you little to nothing.

A very thoughtful (and completely free) way to create your legacy is to write annual letters to your children and other important people in your life.  These letters can be kept with your estate planning documents.  Then, each person will have a special message sharing your feelings and thoughts.

The letters do not have to be held back until your death, either. Many people choose to present the letters to their children upon graduation or on their wedding days.  Estate planning certainly deals with death, but it also gives us a reason to think about life and the way we want to live it.

Another way to create a legacy is to determine important causes in your life and then support them through your estate planning. Whether you are an avid contributor to the American Cancer Society or you have a soft spot for a local animal shelter, these are the kinds of non-profits and charities you can support to ensure your values are represented in your planning.

Many nonprofit organizations will happily work with you to put together some kind of a giving plan for your estate.  There may be tax benefits in addition to knowing that you are doing something important for the world.

A Houston will lawyer can also help you with setting up a family trust that can be used to further causes that you or your loved ones are passionate about.  This is a great way to build a legacy, not just for yourself, but for your entire family.  If you are unsure of how or why you should set up a family trust to create your legacy, definitely take the time to meet with a qualified estate planning lawyer.  He or she will likely have many other suggestions for ways to use your planning in order to help build your legacy.

Houston Estate Lawyer Answers, “How Does a Power of Attorney Document Work?

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A power of attorney (POA) is a document that serves as a written authorization to represent or act on another’s behalf. However, a POA does not necessarily give someone the right to make all decisions. There are different type of POAs, and they have different rules determining the abilities of the person named as Power of Attorney.  As a Houston Estate Attorney, I want to be clear that if you are an agent under POA, it is important to know what decisions you can, and cannot make on behalf of the grantor. Here are a few frequently asked questions regarding POAs.

Do I have the authority to make medical or financial decisions for the grantor? Or both?

You can have either a financial or medical power of attorney. You may have already guessed but a financial power of attorney has authority over your financial matters and a medical power of attorney can have power over medical decisions. A medical power of attorney can have many different guidelines or limitations depending on the desires of the grantor. While it is possible that you have been granted the power to make both medical and financial decisions, it is important to point out that two different legal documents must be executed.

Does this Power of Attorney expire after a set time period or does it go on forever?

This can depend on the state you live in and what that state allows. If your power of attorney expires after a set time, it is important to renew or set up a new power of attorney at that time. If your power of attorney is durable that means that it will hold authority granted by the documents unless the individual chooses to revoke the power of attorney. If you do have a durable power of attorney it is still important to regularly review the document, as some instructions will not accept a power of attorney that is over a certain age, which is typically 12-24 months.

Is my Power of Attorney effective now or after a triggering event?

Many POAs are effective at the time that the document it executed. However, if you wish, you can make it effective only after a certain triggering event such as incapacity.

If you have been named as an agent under a POA for someone, be sure to periodically review the document with an experienced Houston estate attorney who can ensure that you have the decision making authority you need. If you do not have a POA, you should consider putting one in place to ensure that someone can speak for you if you are unable to speak for yourself. Contact us today at  (281) 845-8538 to get started.

Life Insurance for a Professional Racecar Driver? You Bet!

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Since she was in her early 20s, Danica Patrick has driven a racecar—speeding 200 miles per hour around an oval track bordered by concrete walls. It’s dangerous.

Patrick said, “So no matter what your skillset is, those things just happen. Absolutely it is a risk.” 11-15-16

Forbes’ article, “Danica Patrick: You May Not Drive a Racecar, But You Still Need Life Insurance,” says that it’s a risk that she’s chosen to manage in part with life insurance. She’s owned life insurance since she started racing, and she now advocates on behalf of Life Happens, a nonprofit founded to help consumers make smart insurance decisions.

It’s a rite of passage to buy life insurance before your first race. However, Patrick has more personal reasons. Her parents were in favor, as each lost their fathers during childhood and witnessed the financial stress placed on their families. They managed the risk with life insurance and saving six months’ worth of expenses for an emergency.

As far as Patrick is concerned “she didn’t want to leave people with bills they can’t pay, and not only dealing with the sadness of a loss, but trying to figure out how you’re going to manage the rest of…life.”

Life insurance allows us to deal with personal loss without compounding it with financial stress. The suggested policy for most families is a term life insurance policy with a death benefit that is approximately 15 times their annual income.

With term life insurance, many life insurance needs will expire, assuming that a family is on track to reach financial independence around retirement age. The specific term of your policy should last at least through the children’s college years—and at most through the age at which you can reasonably expect to be financially independent.

If you want to create an estate, fund charitable bequests, replace an estate lost to taxes or build cash value, you will need some type of permanent life insurance—whole life, universal life, or variable life. Note that permanent life insurance creates additional financial complexity and can be expensive.

If you have a spouse or minor children, you have loved ones relying on you financially. Term life insurance can be pretty inexpensive. And even if you’re not a racecar driver, you face one of life’s most common risks—riding in or driving a motor vehicle.

As Patrick remarked, “It’s probably pretty uncommon to come across someone that hasn’t been in some kind of a car accident. Now, there are surely varying degrees, but you’re not wearing a six-point harness with a helmet on and an ambulance sitting nearby. So, it’s a risk no matter what you do if you’re driving anything.”

Reference: Forbes (Sept. 23, 2016) “Danica Patrick: You May Not Drive a Racecar, But You Still Need Life Insurance”