Ann Arbor Elder Law & Estate Planning

What Happens if There is a Conflict Between My Will and Beneficiary Designations?

When engaging in estate planning, you always should take the opportunity to review beneficiary designations on life insurance policies, pensions, individual retirement accounts (IRAs), and 401(k) plans. It is absolutely essential that your beneficiary designations and the provisions of your will are consistent. Otherwise, you can end up having significant assets from your estate distributed in a manner that is not consistent with your intentions.

The bottom line is that the beneficiary designations on your retirement accounts and insurance policies always will trump provisions in your will. Therefore, if you designate your daughter as the beneficiary of your life insurance policy, but your will states that the proceeds from your life insurance policy should go to your son instead, the policy proceeds will go to your daughter. The will provision dealing with the life insurance policy proceeds simply will be disregarded in favor of the beneficiary designation on the policy.

Beneficiary designations are particularly important to review if you have divorced at any point. During your marriage, you probably designated your spouse as beneficiary. However, if you later divorce, you probably will want to remove your spouse as the beneficiary of those assets. If you fail to change the beneficiary designation, you risk having significant assets paid out to your ex-spouse rather than to the person whom you truly wish to receive the assets. You even could end up inadvertently disinheriting a child or other loved one, simply because your beneficiary designations do not match the provisions of your will.

Another problem may exist if your beneficiary designation predeceases you. In that case, the proceeds would pass to your designated contingency beneficiary. If both of the individuals whom you have designated as beneficiaries predecease you, then the proceeds of those accounts likely will become part of your probate estate, for distribution according to your will or Michigan intestacy laws, if you have no will.

Reconciling your estate planning documents and accounts with beneficiary designations is only one aspect of the planning that you are likely to find necessary as you begin to age. If you are in this situation, we have the knowledge and resources to assist you. Call Legacy Law Center today and learn how our Michigan estate planning attorneys can advocate on your behalf. will, estate planning, beneficiary designation, life insurance policy, retirement account

What is Probate?

Probate is the legal process for the administration of your estate following your death, whether you have a will or not. If you have a will when you die, your property will be distributed as directed in your will. If you do not have a will when you die, then Michigan intestacy laws determine how and to whom your property will be distributed.

While probate seems to have a reputation for being extremely expensive, time-consuming, and complex, probate only is necessary if you are the sole owner of property at the time of your death. If you own a vehicle jointly with your spouse, and you pass away first, then your spouse automatically has full ownership of the vehicle without going through the probate process. Likewise, if you have transferred your property to a trust, the trust technically owns the property, so it does not go through probate. The same goes for assets with a stated beneficiary, such as a life insurance policy or retirement account.

You will either designate a personal representative in your will, or the court will appoint a personal representative, who oversees the distribution of your property and the payment of bills. In most cases, a personal representative will hire an estate administration attorney to handle the probate process, as well as other professionals as needed, like an accountant or appraiser. Much of the costs of probate stem from the fees of the estate attorney and other professionals.

Probate administration can be informal or formal, depending on the situation. For instance, an estate with assets valued at $17,000 or less can follow simplified probate procedures. Large and complex estates are more likely to undergo probate proceedings than smaller estates involving fewer assets.

While probate is often necessary, there are measures that you can take prospectively in order to protect and preserve your assets for generations to come. Due to the complexities of these issues, you need an attorney who can provide you the help necessary to get through it. At Legacy Law Center, our Ann Arbor elder law attorneys can help you through any situations that may arise as you work through the estate planning process.

What is Long-Term Care Insurance?

Long-term care is an issue that has come to the forefront in recent years, as the costs of long-term care have continued to increase drastically. While some seniors qualify for Medicaid, others only qualify for Medicare, which does not pay for long-term care on a permanent basis. Medicare may pay for a limited stay in a nursing home after being hospitalized, but is not designed to fund this type of care for an extended period of time. For these reasons, it may be important, if not essential, to maintain long-term care insurance to cover the costs of long-term care.

Long-term care insurance operates much like any other insurance policy, in that you pay premiums in exchange for a financial benefit when you become aged or disabled. In most cases, long-term care insurance covers at least twelve consecutive months of necessary services provided in a facility other than the acute care unit of a hospital, such as a nursing home. These services may include rehabilitative, maintenance, personal, or medical services.

These benefits often are guaranteed renewable, which means that you can continue the coverage as long as you would like, so long as you pay the premiums in a timely fashion. The insurer can, however, increase the rates over time by class. Even so, there are some situations for which a long-term care insurer is not required to provide coverage, including preexisting conditions that were treated during the six months prior to the effective date of the policy, mental or nervous disorders, alcoholism, or drug addiction, to name a few. However, your long-term care insurance policy cannot limit or exclude coverage based on the nature of your medical condition, the type of provider for which you are seeking coverage, your location, or the type of treatment sought. 

The Ann Arbor long-term care lawyers of Legacy Law Center are experienced in ensuring that you have the comprehensive and up-to-date long-term care and estate plan in place that best will benefit you and your family. We are your trusted advisors who are skilled in looking at all facets of your life, evaluating your needs, and working collaboratively with you and your family to create a plan that meets all of your needs. Contact Legacy Law Center today and learn how we can help you make the right decisions for you and your family.

Am I Entitled to Special Disability Benefits if I Am a Veteran?

In general, in order to be eligible for disability-related benefits through the Department of Veterans Affairs (VA), you must have been discharged under conditions other than dishonorable from active military service. Specific veterans disability benefits programs have additional eligibility requirements that differ.

Service-connected disability compensation is a cash benefit paid to disabled veterans on a monthly basis. In order to qualify for this type of disability benefit, you must have sustained an illness or injury during service that resulted in a disability or aggravated an existing disability. There is also Special Monthly Compensation available to veterans with certain severe disabilities, such as loss of a limb or loss of vision.

Disabled veterans also may be eligible for a monthly VA pension. In order to qualify for this type of benefit, you must have low income and assets, at least 90 days of military service, including at least one day of service during wartime, and either over the age of 65 or be totally and permanently disabled, which means that the Social Security Administration must have deemed you disabled. Some veterans also can qualify for Housebound Benefits and Aid and Attendance, which is another type of pension program.

Other disabled and retired veterans may qualify for Concurrent Retirement and Disability Payments (CRDP), which enables veterans to receive disability and retirement benefits at the same time. In order to qualify for CRDP, you must have had either 20 years of military service or medical retirement, and a service-connected disability rated at 50% or more. Additionally, disabled veterans with 20 year of military service or medical retirement and a combat-related service-connected disability rated 10% or more can receive another type of special disability benefits.

In addition to cash benefits, veterans may be available for VA health care and VA nursing home care, if needed. These types of benefits may differ from one veteran to the next, depending on the nature and rating of your eligibility.

Determining whether you are eligible for various disability programs, including those through the Social Security Administration and the VA, is not always an easy process. Fortunately, when you don’t know where to turn for help, Legacy Law Center is a valuable resource that you can access as needed. If you or a loved one needs help with disability benefits, no matter their source, you should definitely contact an experienced Michigan elder law attorney at Legacy Law Center right away. Call Terrence Bertram at Legacy Law Center today and see what we can offer you and your family.

Will Medicare Pay For Nursing Home Care?

There is a common misconception that once you reach age or 65, or have been disabled for a certain period of time, you will qualify for Medicare, which will pay for all of your long-term care needs. Medicare, however, only pays for a very small portion of your long-term care expenses. Therefore, it is crucial that you explore all available options for funding long-term care, rather than relying on Medicare to pay for your long-term care needs.

Medicare does cover some nursing home expenses, although in a very limited fashion. After a hospital stay of at least three days, Medicare will pay for skilled nursing care for 20 days in a nursing home, and part of the costs of days 21 to 100 in a nursing home, so long as you still need skilled nursing care, which might include IV medications or physical therapy.

It is actually the Medicaid program that will pay for long-term care indefinitely. Given the high costs of nursing home care, you should evaluate your eligibility for coverage under the Medicaid program, and not take any actions that could jeopardize your Medicaid eligibility. Normally, Medicaid coverage is only for low-income individuals who own few assets. You often will pay the bulk of your income toward nursing home expenses, with Medicaid paying the balance. However, Medicaid eligibility is very complex, and if you recently have disposed of assets or transferred them to another individual, you can jeopardize your eligibility for Medicaid.

Another potential source of coverage is long-term care insurance. This type of insurance can pay for nursing home expenses, so long as you maintain payment of the insurance policy premiums.

Long-term care is an important issue that is likely to impact either your parents or other family members at some point in your life. At Legacy Law Center, our goal is to ensure that you have an effective long-term care plan in place to meet your loved ones’ needs and protect their assets from the steadily rising costs of long-term care. We have the skills and knowledge that you need to make the decisions about long-term care planning for your loved ones. Call your Michigan long-term care attorneys at (734) 995-2383 and schedule an immediate appointment.

What Happens if I Die Without a Will?

When a person dies without a will in the state of Michigan, certain laws, called intestacy laws, dictate how that person’s assets are distributed. Intestacy laws determine who inherits assets from the individual, the order of inheritance rights among family members, how the probate process works when there is no will, and who is in charge of the probate process when there is no will. However, intestacy laws do not apply to any property that was jointly owned with another person at the time of death or to assets with designated beneficiaries, such as life insurance policies.

If you die without a will, you are married at the time of your death, and you have no living parents, children, or grandchildren, your spouse receives your entire estate. If you are married and have children or grandchildren, then your spouse still receives the first $150,000 of your assets, as well as half of the rest of your estate; the other half of your estate is divided equally among your children and/or grandchildren. If you are married and have a living parent, then your spouse still receives the first $150,000 of your assets, as well as three-quarters of the rest of your estate. If you have children that do not belong to your spouse, then your spouse receives the first $100,000 of your assets, as well half of your estate.

If you have no surviving spouse and die without a will, but you have living children or grandchildren, then your estate simply is divided equally between your children and/or grandchildren. If you are not married and you have no living children or grandchildren, then your estate goes to your parents or is split among your siblings.

Intestacy laws also define which children qualify as your children for the purposes of intestate succession. Children include those who are born to you or your spouse during your marriage, those who were born outside marriage, but for whom paternity was established, those children whom you legally adopted, and those biological children who were born after your death. If your children die before you, their children, i.e. your grandchildren, receive the share that would have gone to their parents. The definition of children does not include foster children, stepchildren, and children who you placed for adoption and were adopted by another parent.

At Legacy Law Center, we are Michigan estate planning lawyers who dedicate our practice to protecting your interests, as well as the interests of your family. Creating a comprehensive and effective estate plan is no small task, and we know that you will need guidance in navigating through this often complex process. Call our Ann Arbor office today to set up an appointment and learn how to best protect yourself and your family.

What Do I Need for a Basic Estate Plan?

There are a number of different legal documents that you may wish to execute during the estate planning process. Since so many options are available, you need to consult with an experienced Michigan estate planning attorney who can guide you through the decisions necessary to create the comprehensive estate plan that is best for you and your family.

One of the most basic building blocks of an estate plan is a will, which determines how property is distributed to your heirs after death. In your will, you can determine who gets your property, who should serve as the personal representative of your estate, and who should be appointed as a guardian for your minor children. The provisions of your will do not go into effect until you pass away, and you are free to change any or all provisions in your will throughout your life. Keep in mind, however, that certain items of property are not distributed according to your will. Joint accounts automatically become the property of the joint accountholder upon your death. Moreover, retirement accounts and life insurance policies usually require that you name a beneficiary to receive the proceeds if you should pass away. As a result, these types of assets are not distributed in accordance with your will.

Another crucial part of your estate plan is advance directives. These are legal documents that allow you to make decisions about health care matters if, in the future, you become incapacitated and unable to make or communicate those decisions. For example, through a durable power of attorney for healthcare, you can designate a loved one or friend to be your patient advocate, or healthcare proxy. If medical decisions are necessary and you are unable to make those decisions, your patient advocate will make those decisions for you. Another type of advance directive is what is referred to in most states as a living will. Although Michigan law, unlike most states, does not establish the validity of living wills, there is some legal authority to suggest that a living will is the best evidence of your wishes with respect to crucial healthcare decisions, such as whether to continue or withdraw life-sustaining treatment in certain situations.

Many people also utilize some type of trust to help preserve their assets for future generations and remove assets from the probate process, with the goal of saving their heirs time and money. Since only property belonging to you after your death goes through the probate process, transferring all of your assets to the trust prior to death can help you avoid the need for probate. One of the most common types of trusts is the revocable living trust. A person who creates the trust, or the grantor, transfers all assets to the trust by titling them in the name of the trust, including assets like real estate, vehicles, and bank accounts. The grantor typically acts as trustee during his or her lifetime, and upon death, a trustee designated by the grantor oversees the distribution of trust assets according to the terms and conditions of the trust document.

Legacy Law Center handles all facets of estate planning for clients on a daily basis. We know how to best advise you, based on your circumstances, what options for estate planning are an option for you. Take the first step and call our office today to set up a meeting time with one of our Michigan estate planning attorneys.

What is the Difference Between a Nursing Home and an Assisted Living Facility?

As our population rapidly ages, long-term care becomes an increasingly important issue. There are several different options available for long-term care. Each option has different services that are available and different costs. When making choices about long-term care, whether it is for you or a loved one, it is essential to know the differences between the types of available care.

Nursing homes or nursing care facilities have nursing care available on a 24-hour basis. These facilities are usually for patients needing advanced medical care. As a nursing home resident, you have certain rights under federal law. For instance, you have the right to be a part of planning your care and treatment, the right to pick your doctor, the right to refuse treatment, and the right to sign an advance directive. Many of these rights also are protected under state law.

Assisted living facilities are divided into two distinct types in the state of Michigan. You have legal rights as a patient in one of these facilities, as well, although those rights may belong to your guardian, if you have one. The Aged Licensing Division of the Michigan Department of Licensing and Regulatory Affairs monitors and licenses these types of homes. An adult foster care provides personal care, supervision, and protection, as well as room and board, to 20 or fewer unrelated persons who are aged, mentally ill, or developmentally and physically disabled. This facility provides 24-hour care for five or more days per week, for two or more consecutive weeks, for pay. On the other hand, a home for the aged provides room and board and supervised personal care to 21 or more unrelated people who are age 60 or older. If a home for the aged operates a home for the aged as a part of a licensed nursing home, it can provide care to less than 21 residents.

The long-term care attorneys of Legacy Law Center pride themselves on successfully guiding clients through the long-term care planning process, as well through any other related matters that may arise. We have the knowledge and resources to help you make the decisions that are best for you and your family. Don’t hesitate to call our Ann Arbor office today and learn how we can assist you.

Can I Disinherit My Child?

While the choice to disinherit a child brings thoughts of family discord and estrangement, that is not always the case. In some situations, a parent has made gifts to the child during his or her lifetime and wants to leave the remainder of his or her estate to other family members or to charities. In other situations, a parent has named a child as beneficiary of one or more life insurance policies or retirement accounts and wishes to leave other assets to people other than the child.

Keep in mind, however, that under current Michigan law, a parent may not be able to totally disinherit a child. In the case of In re the estate of Shelby Jean Jaguga, the Michigan Court of Appeals ruled that if a parent has no surviving spouse, a surviving child has the absolute right by statute to exempt property, which is a certain amount of the deceased parent’s personal property, which is periodically adjusted for inflation. This is the case even if a parent explicitly disinherits the child in his or her will.

Equally important to remember is the fact that all assets do not necessarily pass through a will. For instance, if you jointly own a piece of property with your child at the time of your death, the child automatically will receive sole ownership of that property, regardless of what your will says. Similarly, if you name a child as the beneficiary of your life insurance policy, your child will receive the proceeds of the policy at your death. This also may be the case if your named beneficiaries to the policy predecease you, in that the proceeds may go to the closest surviving relative, which may be your child.

Planning for your family’s future is a complex process that can involve many different options, including the choice to disinherit a child. By answering some of your questions and addressing your concerns, it is our hope that we can help you create the estate plan that is best for you and your family. At Legacy Law Center, we are here to advocate on behalf of all individuals and their families who need help planning for the future. Contact us today at (734) 995-2383, set up an appointment with one of our Michigan estate planning attorneys, and discover how we can help you and your family.

What is a Living Will?

A living will is a legal document that sets forth an individual’s wishes in terms of medical care in certain situations. If an emergency occurs and he or she is unable to effectively communicate his or her wishes or make medical decisions, a living will goes into effect. Michigan is one of the few states that does not have a law that specifically establishes the validity of living wills. However, Michigan case law does reference living wills as being the best evidence of a patient’s decisions about health care matters. Federal law also gives validity to living wills; all hospitals receiving federal funding must inform patients about their right to have advance directives, including living wills, in place.  

More specifically, a living will comes into effect only when a person is permanently unconscious from terminal disease, accident, or surgery, and unable to make necessary medical decisions. For instance, your living will could state that you want all lifesaving measures taken if you are in an accident. On the other hand, you could use your living will to state that you do not want to receive life-saving measures such as artificial nutrition or CPR, but only want to receive the care necessary to make you comfortable. Although there may be no law validating living wills in the state of Michigan, a living will still can give your loved ones and medical personnel some direction if they have to make decisions in an emergency situation.

A living will can be a legal document that stands alone, or it can be part of a comprehensive advance directive plan. In addition to a living will, advance directives often include a durable power of attorney for health care, which designates a patient advocate, or a health care proxy, to make medical decisions on your behalf when you are unable to do so.

If you want to have a comprehensive plan in place for the future, in order to protect yourself and your family, our Washington estate planning attorneys can guide you through every step of the process. We are here to answer your questions, both now and in the future, about all aspects of the estate planning process, including living wills. At Legacy Law Center, we have represented the interests of countless individuals throughout the estate planning process. Contact our office and set up an appointment with one of our experienced elder law attorneys today.