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Estate Planning Year-End Review - Are You Ready For 2021?

11/26/2020

 
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The end of any year is a busy time with holidays, family obligations and this year specifically, the pandemic concerns. However, it also is a good the time to take stock in your personal life and finances and plan for any adjustments you need to make for 2021. The earlier you can do this, the better prepared you will be for the future.

Here are some activities we encourage you to do before the end of this year:
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  • If you already have an estate plan in place, review the beneficiaries 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?
  • Review the beneficiaries named on your insurance policies, retirement accounts such as your 401(k) and IRA, bank accounts, and other financial assets to assess whether changes need to be made.
  • ​If you’ve purchased or inherited a new property, car, mineral rights, etc. in 2020, your estate plan should include those items, according to the type of planning you have chosen. With trust based planning or beneficiary planning, if these assets are not properly titled, you could unintentionally  create the need for a probate action upon your death. Similarly, if you have sold an asset this year, be sure your estate plan reflects this change.
  • Review your Powers of Attorney, Will or Trust and confirm that the individuals you designated to be “in charge” are still able and willing to act as your agent/Executor/Trustee. Perhaps you no longer have the same relationship with the named individuals, or perhaps one of them has moved away.
  • Inform at least one trusted family member as to the location of your original estate planning documents. Although it is not required, you may wish to schedule a family meeting to walk through the contents of your estate plan. This allows you the opportunity to explain your wishes and gives your family a chance to ask questions. You also can ask your attorney to explain your estate plan to your family. A family meeting with your estate planning attorney can help your children understand how your estate will be handled upon your death and may provide some measure of neutrality for families with more volatile personalities.

​For more information on end-of-year planning as it relates to your estate plan, contact Davis & McCann, P. A., Dodge City, KS. We are members of Wealth Counsel, a national consortium of Estate Planning Attorneys and Elder Law. We focus our practice on providing clients with the best legal advice on estate planning, Medicaid and Long-term Care Planning, Family Business/Small Business Succession Planning, Probate, Trust Administration, Real Estate Transactions, 1031 Exchanges, and related matters.

Long-Term Care Crisis - Navigating An Emergency

11/19/2020

 
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​In a perfect world, everyone would establish a long-term care plan well in advance of needing such care, all the necessary finances to pay for any such needs would be in order and everyone in the family would be prepared to help execute that plan at any given moment. But the reality is that most people procrastinate on any type of planning that focuses on the possibility of serious illness or death.
 
When an unplanned event happens that requires immediate long-term care, and in the absence of an existing plan, long-term care ‘crisis’ planning can help you navigate the days to come. What is Long-term care ‘crisis’ planning? This term is based on the notion that an event occurred that now requires you to make decisions regarding long-term nursing home care, including addressing the cost of such care, in a short period of time. 
 
Your first step might be to seek advice from professionals who are trained in the area of long-term care planning and stay current on the best methods for addressing your situation, as the rules and regulations of Medicaid are complicated and change frequently. Below are a few of the ways a trained professional might help you manage your long-term care crisis situation:

  • Education. Maybe you just want more information about long-term care and Medicaid. A trained professional can walk you through the process of what to expect and educate you, so that moving forward you feel confident making educated decisions regarding your loved one’s care.
 
  • Spenddown. You are looking to apply for Medicaid. A trained professional can provide guidance on how your assets may impact your Medicaid application approval.
 
  • Spousal Division of Assets. You are still living at home and are looking to apply for Medicaid on behalf of your spouse who is in the nursing home. A well-trained professional can provide you with the needed assistance with a division of assets between spouses.
 
  • Medicaid Application. You need assistance with a Medicaid application. A professional highly educated in Medicaid and estate planning law can work closely with you and the nursing home while filing your loved one’s KanCare application (KanCare is the program through which the State of Kansas administers Medicaid) to try to make the process as smooth and easy as possible. 
 
  • Asset Preservation. Trained professionals develop a plan to preserve your loved one’s assets while also working towards Medicaid eligibility.
 
For more information on long-term care crisis planning, contact Davis & McCann, P. A., Dodge City, KS. We are members of Wealth Counsel, a national consortium of Estate Planning Attorneys and Elder Law. We focus our practice on providing clients with the best legal advice on estate planning, Medicaid and Long-term Care Planning, Family Business/Small Business Succession Planning, Probate, Trust Administration, Real Estate Transactions, 1031 Exchanges, and related matters.


Small Business Formation - Why Your Business Structure Matters

11/12/2020

 
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If you’re one of the many small business owners who thinks estate planning is for wealthy, large business owners and executives, perhaps even multi-millionaires, think again.

Regardless of the size of your bank account or the size of your business, estate planning can be beneficial for everyone, especially for the small business owner. For many small business owners, their livelihood and family’s security are largely dependent upon the success of their business. Proper estate planning for small business owners can help protect both personal and business assets from creditors. Part of that planning involves how you choose to organize your business. The business structure you choose can also have a major impact on your taxes. You would be wise to review your business organization options to ensure your current or proposed business structure provides you with the best tax and asset protection.

Here’s a quick look at some of the business organizational options that are available in the state of Kansas:
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  • ​​​Sole Proprietorship. A sole proprietorship is a business with a single owner. There is no separation between your business and personal assets with this type of structure. This means that your personal assets could be at risk if your business is sued and found to be at fault. This type of business is less optimal for most, as it provides little to no tax and liability protection. One upside to this type of business is that there are no annual state filings and no required annual organizational upkeep.
  • C-Corporation. Any business that is “incorporated” is automatically categorized as a C-corporation, unless the business files forms with the IRS electing to be taxed otherwise. With this type of entity, you do separate your business assets from your personal assets for liability and creditor purposes. Your business assets, owned under the name of the business, are taxed at a corporate income tax rate. Any distributions of income from the business to the owners is then taxed again as personal income. Annual filings with the Secretary of State where the business is incorporated, as well as any states that it does business in, are required. The business should also have meetings annually that it memorializes in minutes signed by the stockholders and directors of the business. A C-corporation is a good fit for those owners with high income tax rates, or who want to attract investors and foreign ownership.  


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Long-term Care Awareness - Will Nursing Home Care Cost Me Everything?

11/5/2020

 
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​November is Long-term Care Awareness Month. Statistics show that between 50%-70% of our population who reach age 65 will require long-term care at some point in their life. Losing all of one’s assets to pay for nursing home care is a legitimate concern for people. With the cost of a private room in a Kansas nursing home at approximately $70,000-$90,000 annually, it’s no wonder why senior citizens are looking for help to preserve at least some of their assets for their heirs.
 
Let’s review some facts about long-term care planning, specifically Medicaid planning. 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 your 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, the goal is to avoid selling your assets to pay for your long-term care. If you have a spouse still living at home, then Medicaid planning may also allow you to preserve income for that spouse rather than paying it to the nursing home.
 
Married Couples:
When married couples consider Medicaid planning, the “best case scenario” is to retain the benefits of all their assets and still have Medicaid pay for nursing home care when the time comes. To accomplish this, all planning and funding should be completed five (5) or more years prior to one of the individuals needing full-time nursing home care. If you have less than five (5) years before an anticipated nursing home admission, other options exist to preserve assets, but those options are more limited and vary, based on circumstances.
 
Unmarried persons:
A single person can also utilize Medicaid planning, although the percentage of assets preserved may vary, again depending on the circumstances.
 
Elder law generally, and Medicaid planning specifically, is a complex body of law and an area that sees frequent rule revisions. The application process can be a paperwork nightmare, so having an experienced professional to guide you through the system is advisable. You are not required to use an attorney to plan for possible nursing home admissions. However, most nursing home and social services professionals are not trained to provide sophisticated Medicaid planning advice, which can protect the greatest amount of your assets. Additionally, not just any attorney is qualified to advise you on your long-term care options. Look for an attorney specifically trained in Elder law and Medicaid planning issues to provide you with a plan of action to preserve the greatest amount of your assets, as allowed by law. 
 
If you have questions about Medicaid or long-term care planning, contact Davis & McCann, P.A., Dodge City, Kansas at 620-225-1674. We are members of Wealth Counsel, a national consortium of Estate Planning Attorneys and the National Academy of Elder Law Attorneys (NAELA). We focus our practice on providing clients with the best legal advice on Estate Planning, Medicaid and Long-term Care Planning, Special Needs Planning, Family Business/Small Business Succession Planning, Probate, Trust Administration, Real Estate, 1031 Exchanges, and related matters.

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107 Layton Street, Suite A
Dodge City, KS 67801
620-225-1674

Davis & McCann,P. A. is a premier Estate Planning law firm in Dodge City, Kansas, assisting Western Kansas clients with Estate Planning, Probate, Trust Administration, Business Formation, Business Succession Planning, Farm and Agricultural Business Succession Planning, Real Estate, Elder Law (Medicaid and Long Term Care Planning).  The information found on this website is for informational purposes only and is not a legal opinion, does not provide legal advice for any purpose, and neither creates nor constitutes of an attorney-client relationship.
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