Estate Planning Information
Experienced Massachusetts Estate Planning Lawyer
We at Curley Law Firm LLP help you and your family plan for the future. You identify the goals and we create the strategies to achieve those goals. Common estate planning goals include:
- Asset Protection – Shield your hard-earned assets against the risks of nursing home and Medicaid (MassHealth). The cost of a shared room in a nursing home can now exceed $150,000 per year, and the costs continue to rise each year faster than the inflation rate. Without advance planning in place, a long-term nursing home stay can wipe out your nest egg.
- Probate Avoidance – Without careful advance planning, your loved ones will have to probate your estate at the probate court. Probate can result in significant unnecessary time and costs to pass your assets on to your loved ones; it can introduce your private financial and estate matters into the public setting of the probate court; and it can increase the chances that a disgruntled family member might contest your estate.
- Preserving Health and Financial Decision-Making Control (Avoid Conservatorship and Guardianship) – You can plan in advance so that if you become incapacitated during your life, only the people you have chosen can make health or financial decisions for you. Without advance planning, your loved ones will be at the mercy of the probate court and the person appointed by the judge may not be the person you would want to make these decisions. More importantly, conservatorship and guardianship are enormously costly and totally unnecessary through careful advance planning.
- Planning for Minors, Young Adults or Loved Ones with Special Needs – If you become sick or pass away, you must plan if you wish to protect any minor or special needs beneficiaries. If you fail to protect them in your Estate Plan, an inheritance may add no value to the beneficiary’s life – or worse – it may even harm their life by giving them money they are not ready for or depriving them of benefits they need. For instance, very few 18 year old are mature enough to inherit significant money, but if you fail to plan with trusts, MA law allows an 18 year old to inherit outright.
- Estate Tax Avoidance – Massachusetts assesses an estate tax on estates with a value in excess of $1 million. Unless Congress changes the estate tax laws (seems pretty unlikely given that Congress can’t even agree on the weather), in 2013 your family could also owe a federal estate tax on estates with a value in excess of $1 million. The tax rate would be 55%! To put that in perspective, if you died in 2013 and your gross estate is valued at $1.5 million (remember, the IRS counts everything when calculating your gross estate – including life insurance proceeds!), then your estate tax hit will be more than $250,000! But with careful advance planning, you can eliminate or minimize estate taxes upon your death so that your family inherits your assets rather than the state or federal government.
- Protect Your Family’s Inheritance Against Divorce and Creditors – Without careful advance planning, upon your death, your beneficiaries’ inheritances are at risk if your beneficiaries divorce or get sued. If you want to ensure that your money stays in your family and is protected, you must plan in advance with Trust planning.
- Medicaid Planning Flexibility – Many powers of attorney are inadequate because they do not contain the authority necessary for your appointed Agent to engage in planning to preserve and protect your assets should you get sick. With correct planning, you can ensure Asset Protection to the maximum extent permitted by law.
- Homestead Statute Protection – The Homestead Statute changed dramatically in 2011. It is vitally important that you ensure that you have the maximum protections under this revised statute.
Depending upon your mix of Goals, your Estate Plan may include the following customized planning documents:
- Last Will and Testament – Your will ensures that you – and not the Massachusetts legislature – determine the beneficiaries of your assets upon your death. Your personal representative (a.k.a. executor) will work with us to fulfill the terms of your will upon your death. If you have any minor children, your will appoints a guardian to care for them upon your death. The only assets that will pass through your will are assets that are titled in your name alone upon your death. As a result, your Will does not control jointly owned property, assets titled in trust, life insurance (so long as you have named beneficiaries on those policies), and investment and retirement accounts (so long as you have named beneficiaries on those accounts). In appropriate cases, we can help protect a deceased spouse’s assets for the sole benefit of the surviving spouse – leaving those assets fully protected and outside the reach of Medicaid.
- Durable General Power of Attorney – Under a durable power of attorney (POA), you appoint an agent to make financial decisions if you are unable or unwilling to do so yourself. Without a valid POA, your loved ones cannot make financial decisions for you – they must instead seek special conservatorship authority from the probate court. Your POA agent has a strict legal duty to act only in your best interest and try to make choices you would make if you were able to do so. Not all POAs are created equally. As elder law specialists, we draft your POA to include all necessary authority for your agent to preserve and protect your assets and income in the event you require nursing home care and/or Medicaid to the maximum extent authorized under the law.
- Health Care Proxy – You will appoint an agent to make medical decisions in the event of your incapacity. Without a valid Health Care Proxy, your loved ones cannot make medical decisions for you – they must instead seek special Guardianship authority from the Probate Court. With a Proxy, you can avoid the time and expense of Guardianship. Your appointed agent in the Proxy cannot make medical decisions for you unless and until your doctor determines that you are incapable of making those decisions yourself.
- Directive to Physicians (Living Will) – You may affirmatively request that your health care agent refuse or remove life support in the event you are in a persistent vegetative state. Your living will helps ensure that your moment of death is not artificially prolonged by a hospital or court ruling. It is very important to discuss the terms of your living will with your appointed proxy, so that they can understand and enforce your wishes.
- Appointment of a Guardian of a Minor or Disabled Child – You can appoint a Guardian of your minor or disabled child in the event that you become incapacitated for a period of time.
- Homestead Declaration – Massachusetts provides you an automatic Homestead protection of $125,000 on the equity in your home. We can increase that protection to $500,000 or more by recording a carefully drafted Homestead Declaration at the Registry of Deeds. The Homestead protects you against lawsuits and creditors but offers no protection against Medicaid (as discussed below, our Irrevocable Trust planning can offer that protection).
- Revocable Living Trust – A revocable living trust can help you avoid probate, minimize estate taxes, and shield your beneficiaries’ inheritances against divorce, creditors, and even estate taxes upon their death. You retain total control over your revocable trust and all assets you title into the trust. If you get sick, your appointed successor trustee will manage those assets for your benefit. You can amend or revoke the trust at any time during your life so long as you have decisional capacity.
- Irrevocable Trusts – An irrevocable trust can help shield assets against the risks of nursing home and Medicaid (MassHealth). Transferring your assets into an irrevocable trust will trigger a five-year look back period for purposes of Medicaid qualification. This means that you would not qualify for MassHealth benefits during that five year period. As a result, an irrevocable trust is most effective as an advance planning tool where you do not expect nursing home care in the next five years. After five years, the trust assets are off limits to MassHealth and the nursing home.
- Irrevocable Life Insurance Trust (ILIT) – An ILIT can help shield your life insurance proceeds against estate taxes. This ensures that you pass on your wealth to your loved ones rather than to the government. Without the ILIT, your life insurance proceeds are counted towards your total estate value for purposes of determining your estate tax obligation.
- Special Needs Trust – If you wish to provide for a loved one who has special needs and may need help or be receiving government benefits, then this type of trust can help ensure that your gift or inheritance will serve that loved one long into the future. A special needs trust can allow assets to be used to supplement the beneficiary’s care but shield those assets to prevent disqualifying the beneficiary from any public benefits to which they might otherwise be entitled.
- Retirement Plan Trust – If you have retirement accounts with sizable balances, you should strongly consider this Trust. With our tax planning experience, we can shield the retirement plan assets against estate taxes so that those assets pass to your children or loved ones rather than the government and maximize the income tax deferral so that your children can take advantage of a lifetime of tax deferred growth. Better still, because the assets enjoy the protections of this Trust, if your child does not fully spend down that share it will pass estate tax free to your grandchildren.
- Limited Liability Corporation – If you have business assets or real estate assets that subject you to significant liability, we can establish an LLC to hold those assets and to shield your other assets from any liability exposure. Also, we can ensure that the LLC planning ties in with any other estate tax or asset protection planning we do for you.
Contact a lawyer at Curley Law Firm LLP today by calling toll-free (866) 406-8582 or contacting us through our Intake Form.