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.
Attorney Kristina Crawford of Davis & McCann, P. A. located in Dodge City, Kansas, recently attended a specialized course on key legal technical concepts aimed at Medicaid planning and planning for individuals and families in crisis situations.
Elder law attorneys provide specialized legal services in the areas of estate planning, elder law, Medicaid, and Special Needs Planning. Specialized training is required to provide competent service in these areas and ensure proper implementation of legal strategies.
With many senior citizens today facing long-term costs of hundreds of thousands of dollars, Ms. Crawford can knowledgeably help clients figure out how to pay for nursing home, assisted living facility or home health care without depleting their hard-earned assets.
Clients should have confidence that Ms. Crawford will not only be proficient in this area of law, but also that she will draft comprehensive documents to support the implemented strategies and ensure proper execution of the clients’ plan.
Medicaid planning allows Attorney Kristina Crawford at Davis & McCann, P. A. to save their clients not only hundreds of thousands of dollars but also the stress of how to pay for long term care. This is only one example of the valuable elder law services the firm provides.
The law firm of Davis & McCann, P. A. is celebrating attorney Kristina J. Crawford’s first year anniversary. Ms. Crawford joined Tamara L. Davis and Megan L. McCann in the firm on September 1, 2015, and has focused her practice primarily on estate planning and related matters.
Kristina is a native of Tulsa, Oklahoma, and is a graduate of Berryhill High School. She attended Greenville College in Greenville, Illinois, where she graduated Cum Laude with a Bachelor of Arts in Communication and Public Relations in 2010. She received her Juris Doctorate from Washburn University School of Law and graduated with Honors in 2015. While attending law school, Ms. Crawford served as a Staff Member for the Washburn Law Journal and was actively involved as a member and officer in various legal societies.
Ms. Crawford is a member of the Kansas Bar Association. She is also a member of Wealth Counsel, a national association of estate planning attorneys.
Kristina was born in Dodge City, Kansas, and has many relatives in the Jetmore and Johnson communities.
Davis & McCann, P. A. serves clients in the areas of Estate Planning, Trust Administration, Business/Farm Succession Planning, Probate and related matters. The office is located at 107 Layton St., Ste. A, Dodge City, Kansas.
With summer upon us, many families are looking forward to taking their summer vacation. Some people will spend their time relaxing on a beach, visiting a foreign country, or visiting friends and family. For many, taking a summer vacation, leaving children with relatives, or taking one of your child's friends along for the ride, is common practice. Most people don’t give much thought to the idea of who can make decisions on behalf of your child or the child in your care.
So what happens if you go on vacation and leave your child under the care of a relative or family friend? What happens if you are thousands of miles away and someone has to make a parenting decision on behalf of your child? This is where powers of attorney come into play. With a properly drafted power of attorney document, you can delegate your parenting responsibilities and decision-making authority to those who may need it.
There are a few specific elements to think about when considering a power of attorney. First, what type of decision-making authority do you wish to pass on? Second, who is receiving the authority from you? Third, should the decision-making authority only last while you are on vacation and lapse upon your return?
Additionally, if you plan on taking someone else’s child with you on summer vacation, it may be necessary for you to obtain a power of attorney from that child’s parents. For example, if your daughter wants to bring her friend along, you may want to ask the child’s parents for a power of attorney for childcare. If you don’t have such an authorization, it could be more difficult to provide the child with the care they need.
Your summer vacation awaits but before you head off into the sunset, make sure all of your legal documents are lined up. Although chances are good that nothing will happen to you or your loved ones, you don’t want to take the risk that something could go wrong and that the people who need to make urgent decisions can’t.
The days of paper documentation are long gone. Items previously collected and kept in a folder in your desk or filing cabinet are now stored digitally. For example, financial statements, bills, and account updates likely arrive in your email which can make it difficult for your loved ones to manage or distribute your estate after you pass. Without proper forethought, this can lead to confusion for family members, denial of access, and even an inability to locate the accounts or information in the first place.
By putting together a digital asset plan, you’ll help your family tremendously. They'll be able to locate and access the accounts you have online, determine if the digital asset has any financial value that needs to be distributed, successfully distribute the asset to the appropriate party, and avoid online identity theft.
So what should you do?
Make a List of Your Inventory
Put together a list of the digital assets you have. Your inventory may include:
Record Login Information and Passwords
Sharing your logins and passwords is essential to the stability and management of your digital assets. It is extremely important that you record this information for key accounts. Also, if you have computing hardware (computers, tablets, etc) you’ll want to record where those items are located as well.
Specify How You Would Like the Asset Handled
The way you handle different types of assets may vary. While you may want some assets to be archived and saved, you may want others to be deleted or erased, while others should be transferred to family members, friends, or business colleagues. You may have assets with monetary value that should be transferred to people who will continue to manage the accounts, and if this is the case, you may want to think about where that money is going and who will be able to access it after you’re gone.
Store Information in a Secure But Accessible Place
Regardless of where you decide to store your plan, make sure the people who need to know where the plan is actually know. Generally, it’s a good idea to tell one or two people you trust (such as your spouse, your adult children, or a close family member) where it's located and how to access it. This way, when time comes, the people who need to access it can.
A 1031 exchange (a like-kind exchange) is a swap—one investment or business asset for another. While most swaps are taxable as a sale, if you stay within the perimeters of Section 1031 of the Internal Revenue Code, you’ll either have no tax or limited tax due at the time of the swap.
Essentially, you can change the form of your investment without recognizing a capital gain which allows your investment to continue to grow tax deferred. Because there’s no limit on how frequently you can do a 1031 exchange, you can roll over the gain from one piece of investment real estate to another to another and so on. Although you may have a profit on each swap, you avoid tax until you actually sell the investment for cash down the road.
Here are a few things to know about a 1031 exchange:
Within 45 days of the sale of your property, you must also designate replacement property in writing to the intermediary, specifying the property you wish to acquire. The good news is that you can designate multiple properties so long as you eventually close on one of them.
It is important to know that you must close on the new property within 180 days of the sale of the old property. Note that the two time periods mentioned run concurrently, which means time begins to run the day your property sale closes. For example, if you designate replacement property exactly 45 days after you close on your property, you’ll have exactly 135 days left to close on your replacement property.
If you have cash left over after the intermediary acquires the replacement property, the intermediary will pay it to you at the end of the 180 days. That cash will be taxed as partial sales proceeds from the sale of your property.
As you can see, a 1031 exchange, while being a very beneficial tool, can be daunting and rule-intensive. Before jumping in head-first, seek out a legal profession who can guide you through the process.
Passing on a family farm is no simple feat.
Most farm families don’t know where to begin when thinking about the future of their farm. Let’s face it, determining how to sustain the farm operation for later generations and how to divide the estate fairly among kids is difficult. This gets particularly tricky when some kids are working the farm and others are not.
To avoid a confusing mess, building a detailed succession and estate plan for the family farm is essential. Families that fail to put proper planning in place put both family harmony and their most valuable asset at risk.
So perhaps you’re asking yourself, “How can a family pass the farming operation—and access to the land and equipment necessary to run it—to a farming heir without neglecting non-farming family members?” Fortunately, there are several ways to accomplish this goal. Three of the most common options available include:
The farming heir can purchase the farm from his/her parents once they’ve reached retirement age, and the proceeds can then be incorporated into the parents’ estate plan and divided among heirs accordingly. However, there are drawbacks to this approach. The purchase can result in capital gains and recapture taxes for the parents, which reduces the value of what they’re able to pass on once they pass. Additionally, it requires that the farming heir have access to large amounts of money or take out significant debt to complete the purchase.
Alternatively, the farming heir can purchase the farm after both parents’ pass. This allows him or her to take advantage of estate planning rules which eliminate the capital gains tax, because the farm receives a step-up in basis after the parents’ death. However, the heir may have to pay more for the farm at the parents’ death instead of their retirement because the farm’s value can increase during that period of time.
The most popular way to achieve longevity of the family farm and equity among the children is to create a LLC, a limited liability company. By placing the family farm in an LLC, parents keep the farmland together—which benefits the farm heir. The parents give individual units equally to each heir while allowing the farming heir the right to rent or crop share with the other heirs for his or her lifetime or another specific time period. With this technique, specifically stating the mechanism to establish the heir’s rental rates or crop sharing arrangement in the estate plan is crucial. The more specific the terms, the less room for ambiguity and family arguments.
No matter which option farm families ultimately choose, it’s crucial to have a detailed, formal plan in place which outlines terms and, when possible, minimizes taxes.
Estate planning is more than achieving tax savings for the wealthy--it's something else altogether--and everyone over the age of 18 needs at least a little estate planning.
Let’s start by defining plain old estate planning. There are two parts to it.
First, an estate plan identifies the people you want to benefit from your assets. Owning “assets” is not the same as having “a taxable estate.” (More on that in a minute.) Your assets include your bike, car, house, furniture, personal items, checking account, savings account, retirement accounts, life insurance and business interests. While people tend to think that estate planning is morbid, it’s actually about life and making sure that your assets provide support for the people you love. It isn’t about controlling from the grave, it’s about creating opportunities that continue to give benefit for years to come.
Second, an estate plan identifies the people you trust to take care of yourself and your assets if you’re unable to do so. This includes identifying someone to pay your bills (your agent under power of attorney), manage your accounts (your executor or trustee, depending on whether your plan uses a trust), and interact with doctors (your health care agent). If you have young children, this also includes naming someone to raise them (your guardian). These are by far the most important decisions you’ll make as you create your plan, and it’s crucial to identify people who have the time and temperament to take on these tasks.
So why do we say that everyone over 18 needs at least a little estate planning? Let’s consider life in stages.
When you’re in college, you may consider yourself dependent on your parents, but the legal system doesn’t. As an adult, you are entitled to identify the people you want to make health care decisions for you if you can’t. To avoid confusion, every 18-year-old should have a health care power of attorney, which can include instructions about life support. Similarly, every young adult should sign a durable general power of attorney identifying the person who steps into his or her shoes for all other purposes, including accessing bank accounts and school records.
Right after college, you’ll start to acquire assets, the most common ones being retirement plans and employer-provided life insurance. Beneficiary designations filed with the plan administrator or insurer control the eventual distribution of such assets, but it’s still important to have an effective general power of attorney authorizing someone to make decisions about the assets if you become unable to do so. As you acquire other assets, it becomes important to give instructions about who should receive them upon your death.
Once you get married, your spouse moves to the top of the list of people who should manage your assets and make health care decisions if you can’t. But, again, it’s best not to rely on default rules. Update your health care power of attorney and your general power of attorney so your decisions are clear so your spouse and your parents don’t end up locking horns. And think very carefully about how you take title to assets after you’re married. It’s incredibly easy to take title jointly because that means the survivor automatically inherits the asset if one spouse dies. But joint ownership gives the survivor absolute control over where assets go after his or her death. If you want assets to pass to specific people after your spouse’s death, then get advice about establishing a trust.
Having kids is a great joy, but nothing else is as good at making you feel the responsibility of adulthood. You now have the task of deciding who will raise the kids if something happens to both parents while they are young. It’s time to add guardian nominations to your will. Although parents often struggle with this decision, the choice is often easier than expected. If you ask the new parents to write down the list of possible guardians, the lists will likely contain the same group of people. Narrowing down to the top one or two choices seems daunting, but the job gets easier if you shift your focus to the kids of the potential guardians. Once you realize that a couple of your choices have not only made it onto your list but they’ve raised kids you’d like to be role models for your kids, then the choice becomes pretty clear. As part of the same exercise, you need to decide who should manage the assets you’ll leave to your kids, and you’ll almost certainly want to establish a trust so you can give instructions about how those assets should be used to support your kids while they are young. Keep in mind that these can be different people. You can choose one person to raise your kids and someone else to manage assets for them.
Estate Planning is about making decisions concerning your life instead of relying on default rules written by a team of legislators. It's also about putting the people you trust in charge instead of letting someone else (like a judge or a doctor) take over.
Overall, It’s about staying in control.
Adapted from Mark Powell's article, Financial Planning, Personal Finance Essential, found at: https://blog.personalcapital.com/whitepapers/estate-planning-isnt-just-about-taxes/?displayMobileNavigation=0.
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