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New Jersey’s Intestate Succession Laws

November 18, 2019

Filed under: Estate Planning — Laura Pennington @ 3:39 pm

If you pass away without a will in New Jersey, your assets will be passed on to your closest relatives under laws established by New Jersey for intestate succession. Only assets that would have passed through your will are impacted by New Jersey’s intestate succession laws.

New Jersey Road Sign with dramatic clouds and sky.

Typically, this includes only assets that you own in your own name alone. It’s important to remember that many different valuable assets do not go through your will and are, therefore, not affected by intestate succession laws.

Common examples include life insurance proceeds, property that was transferred to a living trust, payable on death bank accounts, funds in an IRA, securities held in a transfer on death account, and property on hold in tenancy by the entirety or in joint tenancy.

If you pass away with children but no spouse, your children will inherit everything. If you pass away with a spouse but no descendants or parents, the spouse inherits everything. If you pass away with a spouse and descendants from you and that spouse but that spouse also has descendants from another relationship, your spouse is entitled to inherit 25% of your intestate property.

If you pass away with a spouse and parents, the spouse is entitled to the first 25% of your intestate property so long as this is not less than $50,000 and more than $200,000, plus three-quarters of the balance. The parents would inherit any of the remaining intestate property.

It can be overwhelming to try to figure out this process of deciding who gets what on your own. It’s important to schedule a consultation with a New Jersey intestate succession lawyer to put together an appropriate plan for passing on your assets.       

New Estate Tax Amounts Announced for 2020

November 12, 2019

Filed under: Estate Planning — Laura Pennington @ 2:13 pm

The IRS has authority on the estate tax and gift tax amounts that affect individuals and families and recently announced changes to the estate tax amount for 2020.

If your estate plan requires an update or if you’d like to adjust your giving strategy in 2020, now is the right time to speak with an estate planning lawyer about those options.

The official estate tax exemption has been increased to $11.58 million per person, an increase from the 2019 number of $11.4 million. This means that as a single person, you can leave up to $11.58 million in assets behind for your loved ones without triggering an estate or gift tax.

Couples, as usual, are able to take advantage of each person’s individual amount for a combined total os $23.16 million. The annual gift amount remains the same at $15,000.

When discussing your options with your estate planning lawyer, you might decide that you can use a combination of giving over your life to maximize the gift tax and giving at death with the raised estate tax amount.

With an upcoming presidential election, possible changes to the gift tax amount are front and center for many people. Depending on the outcome to that election and changes made to the program, if they occur, you’ll want to be prepared by having a dedicated estate planning lawyer who can help you figure out how to make it all work together.

Three Tips to Make Business Succession Planning a Breeze

November 11, 2019

Filed under: Estate Planning — Laura Pennington @ 3:46 pm

No entrepreneur wants to think about a future in which they are not involved in their business without that being their own choice. It’s smart to hope for the best and prepare for the worst but recent studies have shown that far too many entrepreneurs and business owners are hoping and preparing for the best instead.

Research from the National Association of Corporate Directors showed that two thirds of private and public companies had no formal succession plan in place for their CEOs. As a business owner you know that proper plans and structure have a key impact on your ability to thrive.

Since the future is unpredictable, the consequences of failing to institute a formal succession plan could end up harming your loved ones and your business. Three tips to make business succession planning easy include:

  • Don’t procrastinate and instead think carefully about other options if it falls on you to leave the company, such as disability or divorce.
  • Identify a successor for who can step in to provide continuity if you are no longer involved in the business.
  • Identify the current value of your business, preferably with an objective third party so that you know where you’re working from and the different stakeholders who might be involved if you were to step away from the company.          

Sitting down with the right attorney can make a big difference in how you approach and accomplish business succession planning.

Where Should I Keep My Will?

November 6, 2019

Filed under: Estate Planning — Laura Pennington @ 1:56 pm

If you already created your own will without the help of an attorney, it’s still a good idea to have a lawyer review your document to ensure it’s in line with state laws. While a DIY will might seem like the easier route to go, the costs associated with making a mistake on a DIY will can follow your loved ones for many years.

Having the peace of mind of speaking with an attorney gives you the chance to correct anything inside the will that could potentially render it invalid. Furthermore, you can discuss safe places to store your will document after it’s been fully executed.

Your original will should be stored in a safe and fireproof location. Most people assume that a safety deposit box is the best place to store critical documents, including your will and even funeral or memorial instructions. The problem with this approach is if none of your loved ones know where to find this information or if they can’t get to it in time for it to be useful.

More immediate documents like your desires concerning a funeral or instructions from the plans you’ve made in advance could be stored with your estate planning lawyer or a close family member or friend. Someone else should know where to locate this information should it become necessary.

Your original will should be stored in a safe location as mentioned above, but you can keep copies elsewhere. Signed copies of the will are important in the event that the original is destroyed. It’s your job to make sure that you’ve taken as many proactive steps as possible to make it easier for your loved ones if you suddenly pass away.

While it’s a difficult subject to approach, your foresight and planning can help your loved ones in a challenging time.

When to Begin Asset Protection Planning

November 5, 2019

Filed under: Estate Planning — Laura Pennington @ 1:38 pm

Are you concerned about your assets being exposed to risks? Worried that your personal assets could be tapped through a lawsuit or through a creditor looking to close on a debt?

The best time to begin asset protection planning is long before any of these threats is on the immediate horizon. Every state has laws that protect a judgment creditor making legal efforts to collect if the debtor tries to transfer assets out of their own names in an effort to delay or block a collection attempt.

Courts, therefore, can see right through these moves and would likely classify them as “fraudulent transfers.” With asset protection planning, you must be thinking about options to shield your assets well in advance of any filed suits.

Even waiting until you think that a lawsuit might be filed is too late in most cases. While there might be a few limited steps you can take at that stage, you’re much better off by making an effort to talk with your estate planning lawyer about asset protection planning now.

The purpose of taking these steps when there’s no immediate exposure to a suit is twofold: it helps discourage people who think that you might be an easy target for a lawsuit away from doing so because they recognize that your asset protection efforts will make it harder for them to succeed and it also increases your chances of success in the event a suit is filed.

Most people who put together an asset protection plan hope that they never need to exercise its powers in court. But the peace of mind that this provides can give you confidence going forward that if a potential threat emerges that you have options available to you.

If you’re ready to talk asset protection plan specifics, our office is here to help you craft a customized plan based on your needs. Don’t wait until it’s too late- create your plan today.

Own a Financial Firm? It’s Time to Start Succession Planning

November 4, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

Many financial advisors are soon to be aging out of their companies. The average age of today’s financial advisors in the United States is in the mid-50s and plenty of these professionals are moving into their 50s and 60s.

The future fates of these thousands of practices, however, hangs in the balance for those that have not completed succession planning. Studies show that the vast majority of small advisors, particularly those who are handling their firm on a solo basis have no successor or business succession plan set up.

According to recent research studies, solo practitioners who bring in around $250,000 per year in revenue often have no succession plan and the alarming fact that these represent up to 70% of the financial planning industry.

While bigger practices are more likely to have a business succession plan or even a strategy for training future leaders in the company, it is important to sit down with a dedicated business succession planning lawyer and estate planning lawyer to discuss how the future of your business and the future of your personal assets can be reflected together in a comprehensive estate plan.       

Your business succession plan is the roadmap for those still in the company to be able to continue operating even after you’re no longer there. Having a backup plan in case this happens can have a big impact on your company’s success.

Asset Protection Planning: What’s Your Personal Liability?

October 30, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

You’ve purchased car insurance to give you peace of mind if you’re ever in an accident. Based on the same potential exposure risk, you also probably have homeowner’s or renter’s insurance to step in and protect you if an unexpected incident happens.

But over the course of your life, you can’t afford to let those be the only ways that you’re shielded from problems. Asset protection planning refers to the legal steps you can take to protect your wealth from outside attacks. Here are some of the ways that you could be exposed to personal liability issues worth considering as you create your asset protection plan:

  • Divorce: Your former spouse has insider knowledge about your finances, could be owed alimony or child support, or might even be entitled to part of your retirement plans under a Qualified Domestic Relations Order
  • Car accidents: If you cause an accident in an at-fault state with significant injuries associated with another person, it could be difficult for you to pay out an injury award.
  • Vicarious liability: If your employee or business partner is involved in a legal battle or accident, you could also be sued.
  • Perceived wealth: Certain professions, like physicians, tend to be the focus of litigation because of the perception that there’s plenty of wealth behind the person accused to pay out a lawsuit.

Although no one wants to think about the possibility of being sued in the future, it’s up to you to put a plan in place. Even the mere presence of an asset protection plan using trusts can show would-be creditors and litigants that it’s not worth the effort to pursue their claim in court. Your asset protection plan should be created with the help of an experienced lawyer who can create a custom roadmap based on your needs.

Are You Living in One of the Most Expensive States for Long Term Care?

October 29, 2019

Filed under: Estate Planning — Laura Pennington @ 1:12 pm

Long term care costs could decimate your retirement planning if you don’t work out a plan to qualify for Medicaid in advance. Talking to an estate planning lawyer can help put you on the right path so that you or your spouse can tap into Medicaid sooner rather than later.

Many people don’t realize the true cost of long term care until it’s too late. When a loved one enters a nursing home and you hear the quote for a semi-private room, this can be a shock. It’s especially a problem for couples when one partner enters a nursing home and uses up the majority of the couple’s savings.

What happens if the other spouse needs care, too?

What happens when family members and friends are not able to provide the level of care your loved one needs?

A recent study found that the cost for homemaker services, such as tasks like running errands, cooking, or cleaning, increased by over 7% since 2018. And those are services you might hire directly rather than receive in a nursing home. Many families consider relying on these at-home services or assisted living to drop the cost, but not every person who needs long-term care will get enough out of those options if their condition is severe.

Many people want to stay in their own home as they get older, but they’ll need a plan and savings to do so if family is not around. The most expensive states for long term care in 2019 included Alaska, Massachusetts, Washington, D.C., Connecticut, Hawaii, Vermont, New Jersey, and New York.

If you live in these states or are thinking about moving there in retirement, now is the perfect time to speak to an elder law attorney about your options and how to best set yourself up for success.

Your Estate: Don’t Assume it Will All Be Figured Out

October 28, 2019

Filed under: Estate Planning — Laura Pennington @ 1:00 pm

The topic of completing your will might give you some nerves because you don’t want to think about when you’re no longer around or because the process overwhelms you and you don’t know where to start.

Too many people make this costly mistake of assuming that things will be figured out by their relatives or the state after they pass away. While it’s true that the state’s laws on passing on assets without a will do indeed kick in, this can leave behind a real mess for your family.

Those verbal promises you made to one family member about taking an heirloom could explode into a fight between siblings or relatives who want to claim ownership. Without a written document, it falls to the courts.

Handing over control to the courts can cause numerous problems in your estate. So, too can appointing a representative who isn’t clear about your intentions and has to spend months and numerous dollars from your estate to try to piece things together. One of the best things you can do for your family is to provide them with a roadmap.

Your loved ones have plenty to think about after you pass away. Don’t add to the confusion and grief by making it hard to find:

  • Important documents like your will
  • Contact information for your lawyer and other professionals
  • Passwords or digital account close-out details

Store these items in a fireproof box in a place where at least once family member knows to look. Are you ready to work through your options and leave behind a legacy that impacts your family for generations to come? If so, now is the time to schedule a meeting with an estate planning team that can help you to accomplish your goals and plans your way rather than leaving it up to the courts.

From asset protection planning to Medicaid planning to business succession planning and more, our firm works with you to create an individualized plan that serves your needs.

What Should You Consider When Passing On a Big Inheritance?

October 23, 2019

Filed under: Estate Planning — Laura Pennington @ 1:21 pm

Even though receiving inheritance might seem like a welcome windfall for people in your family, there are some setbacks associated with receiving a substantial inheritance.

Every year it’s estimated that over 1.7 million American households receive some form of an inheritance. However, within just a couple of years following that windfall, nearly three-quarters of beneficiaries have lost that inheritance, and more than one-third of all inheritors who recently responded to a study stated that there has been a decline in their wealth or no change at all in their wealth after inheriting assets or money.

Inheritances can come with strings attached, especially depending on the type of asset. Some of the setbacks faced by beneficiaries when inheriting property, investments and cash can include:

  • Family conflicts
  • Unexpected tax consequences
  • Unplanned impact on government benefits

Considering all of these issues is an important step for anyone engaged in the process of putting together their own estate planning. Schedule a consultation today with an experienced estate planning lawyer to discuss which, if any, of the above listed challenges could potentially impact your family, and the planning strategies and tools you can use to address that.       

What Should Busy Doctors Consider with an Asset Protection Plan?

October 22, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

Having the best financial practices in place is important for new and experienced physicians. Doctors are unique due to the significant amount of time they spend in undergraduate college and medical school, and residency.

It can be difficult to keep up with all of the various aspects of running a business as a doctor and taking care of patients. It is very important for physicians, in particular, to consider how their assets will be distributed at their death, as well as who is given authority to make financial and medical decisions on their behalf in the event of incapacity.

Doctors are unfortunately exposed to a higher than usual rate lawsuit risk, meaning that it is imperative to take into account opportunities with asset protection planning, tax planning, lifestyle planning, planning for long-term care, retirement planning, investment planning, and insurance planning should also be incorporated into the bigger picture for a physician looking to accomplish estate planning and similar goals.

It can be difficult to figure out the first steps to take if you find yourself in this position. A team of experienced and dedicated estate planners can help you to sort what is most appropriate for you and how to proceed with obtaining the necessary documents and putting these strategies into place.       

Estate Planning Goes Beyond the Will for Veterans

October 21, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

It’s that time of year to celebrate the season and enjoy opportunities with your family. This is also a good time, however, to sit down with your estate planning lawyer to discuss your powers of attorney, trusts, wills, and other estate planning documents.

Bigger Than Basics- Estate Tips for Those Who Served

These foundational documents are the cornerstone of your estate planning, and veterans might have unique estate planning considerations depending on their individual situation.

Some other aspects of foundational estate planning to keep in mind include beneficiary designations that are used to manage former and current employment retirement plans, IRAs and annuities.

The designations on these beneficiary forms will supersede any other estate planning tools, which is why they should be an important component of your plan. Now is also a good time to closely examine the way that your property is currently titled.

Understand the Possible Tax Issues of Your Decisions

There are possible income tax implications that could make a child a joint owner of property leading to capital gains taxes upon the sale of that property.

Make sure that your legal and tax advisors are consulted regarding these possibilities. Make sure that you have liability insurance and a personal property plan in place as well. None of these aspects of your estate planning should be an afterthought.

For military service members or veterans, one of life’s challenges in the military is frequently changing. Developing a continuity book can bleed over into your personal affairs. Your continuity book could include an inventory of all your property, liabilities and insurance policies, as well as details about your key contacts, social media accounts, funeral wishes, and a list of the location of your key estate planning documents.       

Talk to a lawyer about your options for estate planning.

What’s the Process for Intestate Administration?

October 17, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

The intervention of a probate court might be necessary in your estate if you don’t discuss your options with an estate planning lawyer beforehand. Certain assets, such as real estate and vehicles, require particular documents in order for the title to pass. If the owner has passed away, the only way for someone to pass on that title is through a formal court proceeding and resulting order.

If you pass away with no will, all the assets inside your estate outside of those placed in trusts or managed through beneficiary transfer will go through probate administration. Each state has their own laws about how decisions regarding beneficiaries are made. The typical process for intestate administration includes:

  • Starting the case in probate court
  • The court confirming that no will exists and then appointing an administrator
  • The administrator starts their administrative tasks like gathering all the assets inside the estate and notifying creditors
  • The administrator pays out debts and taxes after liquidating the assets
  • The proceeds left over from the debt and tax payment process are then distributed to heirs of the estate in accordance with a schedule outlined in statutes

One of the biggest challenges with the process of intestate administration is that once you have passed away, you have little to no influence over what happens to your belongings. Talking to a lawyer, on the other hand, gives you the option to articulate what you’d like to see happen to your belongings.

With no estate plan in place, the administrator of the estate has no obligation to follow through on any of the requests you might have had in relation to your estate management. Even if you verbally expressed these to the person officially appointed as administrator, he or she does not have to ensure your estate meets these terms.

This is especially important if you wanted to include non-family members in your estate. An estate administrator might not know or be willing to honor that promise you made to an old friend about a certain piece of property; more than likely, the administrator will face pressure to liquidate that asset and distribute the proceeds to your family members at outlined under statutes.

To ensure that your estate is managed in line with your expectations and wishes, talk to a dedicated estate planning lawyer today about the tools you can use, such as trusts and wills, to protect your interests for years to come.

New Study Explores Best States for Nursing Home Care

October 16, 2019

Filed under: Estate Planning — Laura Pennington @ 1:01 pm

Whether you’re researching the option for a loved one or considering your own needs with nursing home care, it’s an important decision that factors in critical details about each facility. This includes how many staff members are in place at any given time, whether or not the facility has been cited for any issues, and the number of residents who don’t improve their health outcomes after a stay there.

Finding the right nursing home requires careful evaluation

These and other factors were recently included in a study completed by Smart Asset to help find where most of the best nursing homes in the country were located. The study identified that financial and lifestyle decisions were important in selecting a nursing home and found that there was good care, in general, throughout the Midwest and the South. Four of the top 11 states included in the study were Louisiana, Alabama, Mississippi, and Arkansas.

The study also identified that nursing home is very expensive, a fact not surprising to any loved ones who have been shopping this option for family. Even in the least expensive states identified in the study, nursing care could cost over $50,000 per year. And given how few people have enough money set aside to pay for this, such a hit could be catastrophic for a couple or individual’s finances.

If you’re in the process of looking for a nursing home for an elderly loved one but are concerned about the cost or about qualifying for Medicaid, it’s time to speak with a dedicated lawyer about your options. The support of an experienced elder law lawyer can put your mind at ease about the Medicaid application process and you can also discuss other critical issues such as whether or not your loved one has appropriate estate planning documents like powers of attorney already created.

There’s a lot to think about with long-term care, but the process can be demystified with an elder law attorney who knows the landscape and the options.

Alzheimer’s and Estate Planning: Using Advanced Directives

October 15, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

An advanced directive is a tool that can be used by anyone to explain the healthcare wishes of a person who is no longer able to make these decisions for themselves. In the vast majority of cases, these documents must be created while the person in question is still able to execute them with a sound mind.

This presents unique challenges for those patients with Alzheimer’s. Family members attempting to assist with the process of putting together an advanced directive want to ensure that the document is legally valid and truly reflects the patient’s wishes.

There are three common types of healthcare directives that should be considered by families impacted by a recent diagnosis of Alzheimer’s. While Alzheimer’s and estate planning issues can be complicated, working with a lawyer who understands this landscape and will approach the planning process with care and concern can make a big difference.

Talk to your NJ lawyer about Alzheimer’s and estate planning

The three healthcare directives to discuss with your estate planning lawyer include:

  • A durable power of attorney for healthcare, which names someone else to make decisions on behalf of the affected person if that person can no longer do it on their own
  • A living will explains the creator’s wishes for emergency medical treatment near the end of the life and which should be elected in times of crisis when the patient cannot speak for themselves
  • A Do Not Resuscitate order or DNR tells healthcare workers not to engage in CPR if the person stops breathing or their heart stops beating.

Another issue commonly surrounding Alzheimer’s and estate planning is the need for caregiver permission to be exercised in advance of a medical crisis. This allows the caregiver to speak with the patient’s lawyer or doctor as needed. Questions often arise about health insurance claims, bills, or care, and appointing a person the loved one can trust can allow for fast decision-making and smoother communication.

Einstein on Saving and Investing & Why People Today May Not Care

October 11, 2019

Filed under: Estate Planning — Raymund Rasco @ 11:42 am

Albert Einstein stated that “compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.”

Most Americans know the benefits of saving and investing early to take advantage of compounding, yet many (if not most) of them don’t.

Why is that?

 There’s not just one answer as to why Americans are not investing, but there are some reasons which are given more than others. Most often, the reasons/excuses I hear from clients are:

1) My expenses are just too high. I don’t have anything left over after my expenses to save and invest.

2) I don’t trust the financial industry enough to invest.

3) The market is inflated and it is due for a correction.

4) I cannot emotionally handle the volatility of the market.

I’m not one to dismiss anyone’s reasons for not investing in the market. However, the downside of not investing, and particularly, not starting early, are well-documented. To address each of the items above:

 1) If your expenses are too high and you don’t have anything left over after your expenses to save and invest, start with a smaller, disciplined approach. Treat saving for investing as if it was a tax. If the government was taxing you 25%, you could not come up with an excuse that you don’t have enough for those taxes. If you treat investing as something which is not discretionary, but more like an obligation like taxes, you can deduct a small amount from your paycheck or bank account directly to have it invested as part of a disciplined approach. 

This strategy is used most often by employees and their 401(k)s or their health insurance. It works because there is no “pain” associated with having to take money out of your account – it was never deposited there in the first place.

2) The financial industry has earned its share of criticism in the media – and much of it is well warranted. The trick is to get yourself in front of a financial advisor whom you can trust. Most often, this is not going to be your local bank or insurance agent.

Ask for referrals and try to find someone who is independent (that is to say, someone who is not obligated to serve the interests of their employer). Ask if they are a fiduciary 100% of the time. If they are a fiduciary, they are required to act in your best interest. If they’re not a fiduciary, they are held to a lower standard-suitability. Even the best hearted people in the industry sometimes have conflicting goals due to mandates by their financial brokerage employer. 

One piece of advice a client has given me: “if they have a football stadium or a professional sports arena named after them, chances are they’re not independent.”

3) Is the market inflated? Maybe. Or maybe not. The point is if you make sure that you are invested with the right mix of risk and reward, your investment horizon should be dictating whether or not such a correction (if and when it happens) does not impact your lifestyle. 

A 30-year-old investing today can take a substantial amount of risk, particularly with their retirement accounts, because they’re expected to work for a longer period of time. A 55-year-old may need to adjust their risk downward, thereby not subjecting themselves to market fluctuations as much. Even during our most recent financial crisis, from 2007 to 2009, if you held your course and didn’t overreact, today your money would be more than doubled. That’s even if you got in days before the big drop.

The point is: you can’t time the market – nobody has done so consistently over multiple periods, so don’t try. Make sure you stay within your risk zone and rebalance as necessary.

4) Everything sounds great on paper, particularly when it’s backed up by evidence – but the reality is, we are human beings. And you’re entitled to your emotions. It’s important to discuss with your financial advisor how comfortable you are with receiving a statement that shows losses.

As an example, when you exercise strenuously or challenge yourself learning a new skill, there is short-term pain and even some frustration in order for you to get the positive results you’re seeking. Sometimes it might be a bit of an emotional roller coaster. If it’s causing you stress or anxiety, it is probably because you may not know, or may need to be reminded of, the positive results you’re seeking. Knowledge will help with emotional volatility most of the time.

Sometimes, knowledgeable even do that for you. In that case, it’s time to make sure that the risk you are taking is appropriate and necessary. It also helps identify different risk pools – knowing that you have an emergency fund which is adequate, and sometimes more than adequate, can help with the emotional impact involved with investing.

Lastly, if you trust your advisor and you have the right person at the helm, you may not want to check the market on a regular basis. Intraday, intra-week, and intra-month fluctuations have been happening since the beginning of the market. So long as you know you have a long-term goal, there’s no need to suffer anxiety from these short-term fluctuations that may never impact you.

What You Should Know Before Applying for Institutional Medicaid

October 9, 2019

Filed under: Estate Planning — Laura Pennington @ 8:15 am

If you’ve already sat down with your estate planning lawyer in New Jersey and still have questions about what Medicaid will pay for when it comes to long term care, advanced planning can help to address many of your concerns and questions directly.

If you need to go to a specialist’s office or a doctor, Medicare will most likely pay for these services, whereas Medicaid will pay second by covering co-payments, co-insurances, and deductibles.

However, when going into a nursing home for long term care, it is important that you understand how Medicaid operates. There are a few things you should know before initiating an application for institutional Medicaid. These include:

  • That you will still be able to keep a small portion of your income as a personal allowance although this amount varies from one state to another and should be discussed with your estate planning lawyer.
  • The program will look at you and your spouse’s individual situation when it comes to counting your assets and your income.
  • Medicaid has a look back period in most states of up to five years, meaning that the state will count any assets that you transferred in the few most recent years when determining your eligibility.
  • You’ll need to discuss with your elder law attorney how owning your home could potentially impact your Medicaid eligibility and coverage.       

If you want more information about how to plan for Medicaid applications in the future, speaking to a dedicated estate planning attorney.

Life Insurance Before and Post-Divorce: What to Know

October 8, 2019

Filed under: Estate Planning — Laura Pennington @ 2:09 pm

You have probably planned your life carefully up to this point and put in time and energy with your former spouse to drop a will and establish trust to organize your estate after you pass away.

Hire an estate planner to use life insurance with estate plans

Together you’ve probably put insurance policies in place for life, health and disability and made decisions about the guardianship of your children should anything happen to you before the children are old enough to care for themselves. With all of these planning opportunities you have already taken advantage of, it can be frustrating to realize that the only thing you didn’t plan for was divorce.

Your estate plan must be amended and updated following a divorce to ensure that your wishes are truly protected during the process of separation and divorce. Life insurance is one such component of your plan that probably requires some amendments. Be clear on how the life insurance is paid for and what it guarantees. Any person who owns the policy is, therefore, responsible for keeping the policy active and enforced and for paying premiums. The same person also exercises the authority to change beneficiaries.

If your ex passes away prematurely, life insurance could become an important component of your divorce settlement to verify that you and your family are paid for.

Life insurance can also help to guarantee the continued flow of child support or alimony or both as outlined by the divorce settlement. It is strongly recommended that you have a trust established as the owner of the life insurance policy to avoid gaps and pitfalls in insurance coverage planning that could arise during and after a divorce. Schedule a consultation with an experienced New Jersey estate planning lawyer to further discuss how this affects your case.       

Create Your Estate Planning Amendment Plan

October 7, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

There are many different reasons that you might wish to amend your estate planning documents and this can include various different aspects, such as new beneficiaries, changes to your trust or changes to your will. In order for these updates to be effective, they must be done properly.

Otherwise, this can lead to not just disappointment for you and your potential heirs, but even litigation down the road. Changing your will, for example, must be done through a specific process, such as executing a new will that formally revokes the old will or formally destroying the previous will.

Evidence of previous wills can increase the chances that your case will end up in front of a probate court for litigation over contest related to the will.

Updating your death beneficiary designation forms, however, requires an entirely different process. Even if you have already updated your will to ensure that this process accurately reflects what you intend to accomplish with your estate planning, updates to your will do not automatically reflect onto your death beneficiary forms.

You will need to contact your life insurance company or your retirement brokerage company, for example, to update the forms formally in their system and you will also want to receive confirmation that those updates have been made.

Amending your estate planning forms is important anytime that you have a major change in your life, such as a divorce or a remarriage. Failing to update these forms means that the associated companies are legally responsible to follow through on those most recently filed with your information.       

Who Are the Stakeholders Involved in Business Succession Planning?

October 3, 2019

Filed under: Estate Planning — Laura Pennington @ 9:15 am

You’ve probably taken a long view approach to establishing and founding your business. Growing a company is probably one of the greatest achievements of your life, but if you’ve failed to consider the other potential stakeholders who could be influenced if you had to leave the business either by your own choice or involuntarily, you could be exposing the business, its legacy and treasured family members and employees to unnecessary risks.

Think carefully about who will be able to run your business after you leave. One advantage to taking this process into consideration earlier than in a crisis situation is that you have plenty of time to pass along the necessary skills to assist each person with the job at hand.

There are three primary options for stakeholders to consider in business succession planning; an independent purchaser, employees and family members. Independent purchasers can include a strategic or a financial buyer. Employees could purchase through structures, such as an employee stock ownership plan and can help minimize risk by easing your transition out of the company.

Finally, family members might or might not be the answer for what you intend to accomplish with business succession planning, but you should discuss this carefully with a knowledgeable business succession planning attorney who is very familiar with your individual goals and plans for the company.       

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