EdLoweLaw OP t1_jd8p2gq wrote

Gotta be made by the old sick person in this case, because it’s their assets that will ultimately go into the special needs trust. That’s how we maintain the protection of the assets, the one receiving the benefit has no say over the trust’s terms.

If the old sick person isn’t able to travel to work with an attorney, much can be done over the phone or email. If they signed a power of attorney, one of the powers given to their agent may have been the power to do this legal work for them as well. It’s worth asking the attorney about for sure.


EdLoweLaw OP t1_jd7whly wrote

Certainly any inheritance that someone would want to go to either of those people should instead go into a special needs trust for their benefit.

A special needs trust is an irrevocable trust designed to hold assets for a beneficiary, allowing them to benefit from their needs-based state program AND benefit from their inheritance WITHOUT the state being able to recover from the inheritance.

The person who needs to do that type of planning is the person who plans on leaving an inheritance behind for someone on a needs-based program like Medicaid. They would set the terms of the trust while they’re alive, but it would stay empty until they’ve passed, at which point the inheritance would go to the beneficiary’s special needs trust, rather than the beneficiary as an individual.

It’s difficult to say what an attorney would charge for this work. Depending on what is needed in the planning costs would likely start in the low thousands. A consultation with a trusts and estates attorney should allow the attorney to give them a fee quote, and it’ll likely be a flat fee instead of hourly.


EdLoweLaw OP t1_jd7j7cn wrote

Dang that is quite a pickle, and one that I unfortunately have very limited experience in. What you should search for is an environmental law attorney to advise you on remediation and limit your potential liability with this property. I’m afraid I can’t think of any environmental law attorneys to refer you to.


EdLoweLaw OP t1_jd4z7aj wrote

Congratulations to you and your wife, friend! It all depends on your estate planning goals, but if you’re concerned about avoiding the probate process you can probably skip the trust until you have real estate, because you can always use beneficiary designations for most assets. Wills, POAs, and healthcare documents may be all you need.

HOWEVER, if you do end up creating a will, there will be something called a “testamentary” trust built within it to protect and manage assets for your bambino should you and your wife die before they reach a certain age. This type of trust is under the probate court’s jurisdiction, which many people like or don’t like depending on how they feel about a lot of different things. Often, people will opt to create a revocable living trust with the primary goal of allowing a minor beneficiary’s inheritance to be managed privately, rather than through the court.

If you meet with an estate planning attorney for a consultation, they should be able to get to the heart of what’s most appropriate for you, your wife, and the little one. As the family grows, so should the estate plan. Congratulations again!


EdLoweLaw OP t1_jd4upxc wrote

Love that plan! People can be very hesitant to talk about their death and incapacity, especially once they’re older and set in their ways. It’s good if you to bring it up, and double good of you to be available to care for them! Keeping them in home and independent should always be goal #1.


EdLoweLaw OP t1_jd4sdhi wrote

Your parents certainly should have an estate plan (at least wills, POAs, and healthcare documents) and their planning may or may not involve a trust depending on what they’re trying to accomplish. Many folks use revocable trusts to help avoid the probate process, but in the context of Medicaid planning it works a little differently.

The idea with Medicaid preplanning is to not have any assets available to spend on your nursing home stay. If you have no money, the state’s Medicaid program (Husky C) will pay your nursing home bill for you. When you apply, the state will look back 5 years to see what type of transfers you made, and if you made an uncompensated transfer or gift within 5 years you’re penalized for the value of that gift.

Long term care insurance is an option, but the premiums are very high. I, as an attorney, would be looking at getting assets out of your parents’ names now while they’re healthy so that hopefully at least 5 years goes by before they need to go into a nursing home.

“But Ed, I don’t want to give everything away!” I agree! That’s why we’d create a Medicaid Trust to hold your assets. It’s an IRREVOCABLE trust, but you still set the rules of the trust. You can be the trustee (the person who manages and distributes assets), be able to live in and use real estate for your life, and even change the beneficiaries of the trust…but not to yourself. That cash and future real estate belonging to the trust is being managed for the beneficiaries, like your children, and not yourself, so any distributions you make must first go to the children. They of course are free to do whatever they want with it, but the state can’t make them use it on your care as long as the 5 years has gone by.

As a result, you get to keep assets in the family, still manage those assets, live in and use your real estate, and still control who ultimately gets everything while also starting the 5 year process!

Your parents should at least have a consultation with an estate planning attorney to see what’s right for them. Some of what I described here may be what they’re looking for, or it might be completely inappropriate for them. Everyone needs something, but it’s impossible to tell without having a heart-to-heart with that much admired and trusted family advisor: the estate planning attorney.


EdLoweLaw OP t1_jd4pf3u wrote

Perfect question! Trust planning can certainly help us minimize probate as much as possible, but never all of it. In Connecticut, regardless of whether or not you even have a taxable estate, you always have to file an Estate Tax Return with the probate court. Revocable trust planning can’t remove that tax requirement.

What trust planning can do is help us avoid a full probate process. To do that, we would want to have certain assets owned by your living trust (like real estate) and other assets have proper beneficiary designations (like IRAs) so that nothing is in your name alone when you die. If you have nothing in your name alone at death, there are no assets to probate and thus only the estate tax return needs to be sorted. If you have a little more than nothing, but less than $40,000 in your name alone at death, you can even get away with an abbreviated probate process instead of a full probate (which can be handy for those pesky cars everyone forgets about).

If probate avoidance is a goal, you need to make sure all the assets are touched so they don’t need to be probated. If you own real estate in Connecticut, it means you’ll want to consider trust planning to have the property avoid the probate process. Best to have an attorney review ALL your assets to make sure everything is working together to meet all of your estate planning goals.