Preparing Your Will – Special Beneficiary Trusts
This edition of the Koldin Law Center E-Newsletter is part of a series about the role of an Elder Law Attorney. In this newsletter we continue the discussion regarding the planning process for preparing your Last Will and Testament
The Koldin Law Center, P.C. limits its practice to the specific field of Elder Law which includes estate planning and Medicaid law.
All prior newsletters are saved on our website. You can read them by clicking here.
The previous newsletters in this series compared how a general attorney would most likely handle preparing a Will versus how an Elder Law attorney would likely handle the initial client consultation discussion regarding preparing a Will.
Typical Will Consultation with an Elder Law Attorney
In addition to discussing the beneficiaries of your Will, the initial consultation at the Koldin Law Center would typically discuss:
(1) Options to avoid or minimize the need to Probate the Will
(2) Discuss if there are any special provisions that need to be included in the estate plan such as for family members with health issues or disability
(3) Accidentally disinheriting children and grandchildren
(4) Second Marriage complications
(5) Explain that a Will does not protect assets in the event of a long term illness and what planning can be done to accomplish protecting your life savings from the costs of long term care such as nursing home care.
In the previous newsletter in this series we elaborated on the options to avoid or minimize probate.
In this newsletter we elaborate on special provisions that you may want to include as part of your Last Will and Testament or as part of the beneficiary provisions of your Revocable or Irrevocable Trust.
There are many situations where you may want to provide for your family after your death with their inheritance held in a trust. These special trusts are part of your beneficiary clause of your own Trust or Will. The following are some examples of commonly used special beneficiary trusts:
ASSET MANAGEMENT TRUST FOR MINORS:
You can leave a bequest in a trust to be used to pay for the support and education of your beneficiary (example: grandchild). Once the grandchild reaches a designated age such as 25 years old, he/she could receive the balance outright.
SUPPLEMENTAL NEEDS TRUST FOR CHILD WITH DISABILITIES:
If you have a child (or grandchild) with disabilities who is receiving government benefits, you can leave your assets in a trust for your child which would be used to supplement the government benefits but not replace those benefits. Such a trust, if written properly, would not be deemed to be an asset of your child and therefore would not cause your child to lose government benefits.
SUPPORT TRUST FOR A FAMILY MEMBER:
You can leave a bequest in a trust to be used to support and pay expenses of a family member such as an adult child. This is often used when a child does not manage money well and would squander his/her inheritance. Such a trust would have the trustee be the custodian of the funds and use discretion as to when and how the funds should be spent.
INCOME FOR LIFE TRUST (Often Used In Second Marriages):
You can leave assets in a trust where the beneficiary would receive all of the income earned on trust assets, but the principal would remain in the trust.
Upon the death of the beneficiary, the balance would then go to whomever you have designated. This type of trust is often used in a second marriage situation where you want to provide for your spouse, but on his/her death, the balance would then go back to your children.
You can leave funds to be set aside for your pets and designate someone (Trustee) to manage the funds and provide for your pets pursuant to the requirements you set forth in the trust. The Trustee cannot use the funds for any purpose other than to care for your pets.
Instead of leaving your assets directly to your children, you could leave your assets on your death to a separate trust for your children (or other family members). The trust could then designate your grandchildren (or other family members) as the beneficiary of any funds not distributed to your children. This keeps the inheritance of your children separate from their own accounts and earmarks the balance for your grandchildren.
FAMILY CAMP TRUST:
Instead of leaving your family camp outright to your children where they could force each other to sell or buy out ownership from each other or to a third party, you could leave the camp in a Trust for the benefit of your children. You can set up the “rules” for how the camp is to be shared and how expenses must be paid and for when the camp may be sold.
While putting these special provisions in your Last Will and Testament can accomplish your objectives, you will not be avoiding probate nor will you be protecting your assets from the cost of long term care.
Both Revocable and Irrevocable Trusts avoid or minimize probate for real estate. Irrevocable Trusts can also protect your life savings from the costs of long term care. For a complete discussion of Trust planning, see our website by clicking here.
For more information about a Last Will and Testament, please visit our website by clicking here.
The next newsletter in this series will review how your Last Will and Testament can be overridden by other estate planning which can cause you to accidentally disinherit some or all of your children and grandchildren.
At the Koldin Law Center, P.C., located in East Syracuse, New York, we have over 50 years of experience helping individuals plan for immediate crisis and long term care. Our attorneys are available to discuss your estate planning options, including the advantages and disadvantages of Revocable Trusts and Irrevocable Trusts, along with other estate planning considerations including a Will, Power of Attorney, and Health Care Proxy.
When the Koldin Law Center, P.C. handles a Medicaid case, we not only handle the entire application process, but we also review asset protection options with our clients. We review with our clients who are already in a Nursing Home options to protect some or all of their assets beyond merely establishing Medicaid eligibility.
We do not charge a fee for the initial consultation. We welcome your children, family attorney, accountant, and/or financial planner to be present at the initial consultation.
There is something you can do.
Our Attorneys are available to speak to your organization
Our Attorneys speak to groups throughout New York State as a public service. If you would like to arrange for one of our Attorneys to speak to your group, please contact our office.
We appreciate your referrals
We have been told by many clients who are in a crisis that they wish they had known about our firm much sooner. We are proud of the many families we have helped in times of crisis.
We are also proud of the many families we helped avoid financial crisis by doing estate planning in advance.
We all share the responsibility for making our family and friends aware of the planning options available to them.
Your referral to the Koldin Law Center could make a major difference in the lives of your family and friends if they are someday faced with a long term illness.
Remember that the Koldin Law Center offers many services for clients of all ages. Our services range from basic estate planning such as a simple will to complex estate planning including asset preservation planning.
THERE IS NO FEE FOR THE INITIAL CONSULTATION