Q: If I add my child’s name to the title of my house, wouldn’t that be the easiest way to keep my house out of probate and transfer it quickly to my child after my death?
A: The answer to your question is a solid “maybe”. Your personal circumstances will dictate whether this estate planning strategy is the best move for you.
Adding your child’s name to your deed could speed the transfer of that asset to your beneficiaries, and keep it out of probate. But, before you run off and put your child’s name on the title of your house you should consider the risks.
1. By adding your child to the title of your home, you have made a gift that is subject to gift taxes. The gift is likely far below the current federal gift tax exclusion amount, so you shouldn’t have to pay gift taxes. However, you may need to file a gift tax return if the gift is over the annual exclusion amount.
2. If you need KanCare (Medicaid) assistance to pay for nursing home care within 5 years of adding your child’s name to the deed, you could be penalized when requesting benefits.
3. If your child dies before you, his/her interest in your home becomes part of his/her estate. This interest in your home will be subject to his/her liabilities and would pass to his/her beneficiaries as named in your child’s own estate plan. Someone you don’t trust could become the new co-owner of your home.
4. If you decide to sell the house and move, your child could legally refuse to transfer ownership back to
After working in the estate planning field for more than 20 years, we've seen several common omissions in estate plans drafted by inexperienced attorneys or online computer-generated forms. Those omissions include a failure to consider: tax planning, incapacity, divorce, spendthrift beneficiaries, beneficiaries with substance abuse issues, or the possibility of a beneficiary receiving government benefits. To protect your beneficiaries and help keep your assets safe, here are some reasons why you should consider addressing these topics in your estate plan:
Federal Gift and Estate Taxes
Federal Gift and Estate Tax is a tax on the wealth you accumulated or transferred during your lifetime. This tax typically is paid during the probate of your estate or administration of your trust. Too often we’ve seen clients pay more taxes than necessary because simple tax planning language was omitted in their estate plans. After a thorough review of your assets and consideration of your life circumstances, a good attorney will recognize if there is a need for special tax protection language in your estate plan. This language easily can be added to your estate plan and will protect your beneficiaries from hefty and unnecessary taxation.
Having a will is the most basic step you can take in planning your estate. Without this document in place at your death, your State law dictates how to divide your material possessions, who will care for your minor children (in the absence of a surviving spouse), what age those children will receive access to their inheritance, and who will be responsible for selling or distributing your items of value. Despite these facts, nearly six in 10 adults in the U. S. still do not have a will, according to a 2017 Caring.com survey conducted by Princeton Survey Research Associates International.
According to the survey, 78% of millennials (ages 18-36), 64% of those ages 37 to 52 (Generation X) and over 40% of those ages 53 to 71 do not have a will. The problem, according to Megan L. McCann, estate planning attorney and partner at Davis & McCann, P. A., likely centers around two facts: One, young adults rarely consider the possibility of death and two, many people assume they have insufficient assets to require estate planning.
The end of any year is a busy time with holidays and family obligations. However, it also is a good time to take stock in your personal and professional life and plan for any adjustments you need to make for 2019.
If you already have an estate plan in place, take this time to review the beneficiaries that you named in your Trust or Will. Have there been any marriages, divorces, or births in the past year that require a change to your estate planning documents? It also is advisable to review the beneficiaries named on your insurance policies, 401(k), IRA, bank accounts, and other financial assets.
If you’ve purchased or inherited a new house, car, mineral rights, etc. in 2018, your estate plan should include those items. If not accounted for in your estate planning documents, you could unintentionally create a probate action upon your death. Similarly, if you have sold an asset, be sure your estate plan has been adjusted accordingly.
You’ve been named in a Last Will and Testament as an Executor of a Kansas Estate, so now what do you do? Before you begin your role as Executor, here are a few things you might want to know.
As Executor, you have the responsibility of distributing the assets of the Estate to the intended beneficiaries, pursuant to the decedent’s Last Will and Testament. You must understand complex legal and/or financial concepts during the course of your job. As a result, Executors should hire an experienced probate attorney to assist them with the probate process and help them avoid costly mistakes. Here is a basic summary of what you can expect the probate process to include:
Probate is a judicial process whereby the decedent’s assets are transferred to his or her heirs or other beneficiaries. Probate also can be referred to as an estate administration. In Kansas, your estate will fall under one of two categories: testate or intestate. If the decedent had a Last Will and Testament, he or she would have a testate estate. An intestate estate occurs when the decedent died leaving no Last Will and Testament and the state laws of intestacy determine who is entitled to the decedent’s assets.
Typically, the surviving family members of the decedent will seek the counsel of an experienced probate attorney to navigate the probate process. The attorney will determine whether the Last Will and Testament is valid, conclude whether a probate is necessary, and will advise the Executor or Estate Administrator in his or her duties.
Because November is Long-term Care Awareness Month, for the past few weeks we’ve been talking about Medicaid planning. Those of us who work with Medicaid planning and elder care services know what Medicaid planning can and cannot do for a person, but do you?
The purpose of Medicaid planning is to preserve your assets and set up your affairs in such a way that “the State” will pay the majority of the nursing home care costs, if or when the time comes. With good Medicaid planning, you should need only to contribute your income toward nursing home care costs. With Medicaid planning, you should not need to sell assets in order to pay for your long term care. If you have a spouse, with Medicaid planning you may be able to preserve income for your spouse rather than paying it to the nursing home in certain circumstances.
Long-term Care (LTC) broadly refers to medical and social services designed to support the needs of people living with chronic health problems that affect their ability to perform everyday activities. Long-term care services include traditional medical services, social services, and housing. Odds are, the majority of people over the age of 65 will need LTC at some point, but most people don’t plan for it. Sure, people think about and plan for retirement, but rarely are LTC costs factored into such a plan. If you require nursing home care, in our experience, your costs could be as much as $84,000.00 or more a year. For one person in western Kansas—that can be quite the unexpected expense.
What are some ways you can pay for LTC should nursing home care be required?
Sometimes our best laid plans simply don’t work. We typically don’t plan on illness, being in an accident, or early on-set Alzheimer’s. When life doesn’t happen like we plan, we need to be able to talk to someone well-versed in long-term care planning who can help develop a new plan that accomplishes our goals.
Long-term care crisis planning can mean many things, but ultimately it is based on the notion that a major, unplanned life event occurred, and you need to figure out how to move forward with care and address the costs of such care.
Here are a few of the ways we can help you:
Davis & McCann P. A. has named Mary Beth Helfrich, as their new marketing director. Helfrich brings over 20 years of legal experience to the position as well as multiple years in advertising, marketing and education.
Helfrich will be responsible for all forms of traditional and digital communication for the firm, as well as coordinating educational conferences and speaking engagements. Helfrich is a graduate of St. Mary of the Plains College with a B.A. in journalism (minor in Business Administration), as well as Ft. Hays State University with a B. A. in elementary education.
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