Real Life Stories of The Legal Exchange 7-16-17

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Sunday, July 16th
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These are the real life stories of the legal exchange with Susan powers of the Armstrong advisory group and Todd let's just from the love for a month Cushing and over and Susan and son have been helping people understand and react to legal issues that they're faced with every day and they're here to help you to. If you have a story to share contact us on our web site legal exchange showed does come up that's legal exchange showed Doug come. Now here are your posts Todd let's deep and Susan powers well. An incident really stories that we. I'd be happy until I to me and done guys. And in doing by Todd let's see apartment with a lot for him crashing into Allen. With a masters in taxation Todd welcome you I'm never better in you I am great thank you be discussing today we have. Three situations and irony it's nothing new right right always have three so in this case. The first one was not rather uninteresting because this is a client who never became. They came and it happens. You got people don't you know right form whatever reason rated go forward. They Cayman. In 2012. I say the date because it's important they were in their early seventies. Worth about 3.2 million. Had about 815 house one point nine in a rental and some cash to go forward now they're back. Definitely wanna go forward. And I explained them the craft nation's problems that existed here so. And help us understand not only the repressed nation problem but how this whole thing works. So explain that Tia. Next a husband wife had come in they really wanted to do some planning. A lot of questions at a lot of friends who did realty trust and they said we just want our house and realty trust in you know. Just how does that work. Explain to you how realty trust's operate as we move through that story and I had a side story to go with that on realty trust. And lastly there's a nice basic estate planning. Regular run of the mill case that I think most people fit into the fact pattern husband wife came in. In and we wanted to do some planning about 7576. Years old one point five million and and basically owned everything jointly. But I'm sorry the husband actually had died this was just like the husband died in 26 team. And so the wife was only one coming in they never got around to doing their planning and she really want to do planning now. That you don't everything jointly. My question is does this sound like you. So a lot of people that probably it didn't know what does that mean that they lost their spouse what they lose out on and what can they still do. Going forward in that situation I think that really impacts a lot of people. And you know what folks we also have Todd sky duties written for the month of July and it's an operational guide to the use of light the states. In theory book Coble trust and it focuses on what is likely Europe's largest asset which is your home. There's a rightly or wrongly to on your home it is not to just give each year kids it is not to reserve a light the state although less bad. If you're giving it to your kids. But you need to find out what is the latest they concluded that makes sense or who should consider using these light for states. India panic if you have one he partied down and that's the wrong way. Call right now to receive your free copy of Todd sky 86684. Feet 5699. That's 8668485699. Or visit our web site legal exchange showed dot com and click on the guides and articles tab and you can downlink your own copy. Right away in if you missed any of today's or our past shows you can always get our podcasts out there and listen at your convenience. Sosa let's talk about this husband wife situation where. In 2012 they came in weren't about 3.2 million house 850. Rental property one point 9300. Cash. That's roughly the numbers. And and you know clearly living off the rent. Is so big that rent as big that that's a big rental property. And you know we recommended planning in. For whatever reason they just morning to get their hands around there is no deal ready to go forward and they came in just recently. And said. We really wanted to start. We really need to do are planning they've always listened by the way and anywhere still listening in. We just feel like now now's the time. And I said okay we'll has anything changed you know has your assets changed. Has there been any family dynamics that have changed in your life paktia you know to see if if what. I recommend it to them. In 2012. Still applies today share. Made. And and that sure enough no nothing really changed they just know that their five years older and they want to play. And looking back when he could have been done right can I was thinking maybe they're coming and saying you know we we thought long and hard about in the revoke or trust isn't right for us and we'd rather just do you know an obscenity irrevocable trust wasn't right for us we wanna just to revoke trust we think that maybe we can live off of our income and and that's really all need. That's funny. I thought that's what they wanted but now they still lower interest in the protection yeah. OK well let's do it and I looked at him and I said this I'm telling all of you folks. I looked at him and I said you know five years isn't very long time sounds like idiots. But guess what folks we met in 2012 X 2070. You know that's you know. Is it acts tells me that's five years it hard feat and as I told you so in these situations it's not a matter of yeah yeah you're right it's not me telling my tortoise or just sort of explaining to everybody. How quickly five years can go blindly in. It makes me stop and think oh my gosh what is know where it's time goal. Right so. Five years folks not a long time get your clock running so what are we decide for them what kind of plan makes sense for them and if you have a similar situation familiar numbers. Aren't quite as large if you have a similar situation we can do. A certain plane for you share so in this case what would we deal. You know to irrevocable trusts come to mind. We do to irrevocable trust so that we can shelter at the assets for state tax purposes remember 3.2 million is under the five million int change number four. The IRS and federal movement but not for mass which is a million. So he can't eliminate their Massachusetts. Not just basic planning. But we can reduce it. And at the same time I looked at their assets and because of the capital gains taxes built in to these two big properties they have. I explained to them that there's really no benefit in doing additional. Planning you know don't tell you something need a ending or something like that and I just didn't seem to fit for them. So weeks weeks we said let's do the basics of two irrevocable trust in wouldn't take both houses. Rental and primary residence. And conveyed them to that truck to those trusts. Probably idly to 300000 dollars in cash outside which. But that's a lot a lot of assets that you are able to put in means almost seemingly by. Yeah and leaving 300 out there and enjoy it and use it pay bills whatever. So probably I would leave that that they get their clock started so that protect the assets long term care expense instantly said they could've started five years ago but. So any it yet and how much do you think you reduce the estate tax bill by having them do about a 100000 dollars one house that's certainly worth aunts or say about a 100000 dollars an estate tax or certainly we've avoided probate. And more importantly and I think a lot of people are concerned about this. We changed their life. Day to day as you said they were relying on that rental income fund. And and I said absolutely. They can continue to live in their house under the radical trust they can continue to collect all the rent. The rent no would would. Would flow into the trust because remember the trust does own the rental property. But in the trust what automatically kick out that rental income back to them personally. Because remember the very nature of the very. Termed the very definition of our trust is an income only trust in which means that that trustees are paying the income to mom and dad. Husband and wife in this case so they're gonna continue to get the income. To live on to pay the bills to maintain the property. They are also gonna continue to pay the income taxes on that at their own rate. Able file separate returns for the trust's. But the trust don't pay tax write they would pay the tax only at their own personal rates just like they used to. Before they did that trust in in this case we'll they have a light to stay. And that until I went on satellites and other rental property and nor will they have an on the house they have no debt. OK so no I would not recommend a life Stater and you know the other thing I just threw out there for them as. They may wanna put the house of the rental property into an LLC. Limited liability company and then have the shares of the limited liability company owned by. That irrevocable trust to continue to get the protection they're looking for from the nursing home. While still being able to run the LLC personally. Yeah if someone gets hurt on the property. They would sue the LLC and not them nuts and so would add a level of creditor protection. Other than just nursing home protection rain and that was something that they're gonna go to one in think about but the basic plan. Definitely now they're on board within somewhat as airlock and out under their breath you can hear him kind of kicking themselves for. For waiting so yeah I'm sharing you know I'll let that be a lesson to you folks because you may be thinking. We're never gonna make the five years at such a long timely you know what it does live by. Even if you start this process. The Arab benefits to having get that clock started to be human. Coffer copy of Todd guide for the month of July it's an operational guide to the use of light the states and remarkable trust. Are they break for you if you read Todd to guide you'll be able to see that. It also includes information on. Blessing the use of these lakes estates with able global traps coffee your free copy right now. 8668485699. 8668485699. Can also visit our web site legal exchange showed dot com just click on the guides and articles tan. And you can download your copy right away you are listening to Todd lets be a part in with the law firm of Cushing in Dolan. I'm Susan Harris I think need to advise him with the arms on advisory group. We're gonna take a quick break but we'll be right back in just a few minutes on the relay stories of the legally exchanged. Security suffered through securities America member finreg SIPC and advisory services are with the securities America advisors think securities American misrepresented just do not provide legal advice therefore it's important to consult with your legal advisor regarding your specific situation shouldn't all the strong advisory group real life stories of the legal exchange and securities America companies are not affiliated. Your financial strategy has to include a thoughtful insurance plan. Insurance exist to protect your assets our friends of the insure a match agency can prepare personalized plan that gets you the best coverage at the best price call insure a match at 84499. Match let's paid for four and 99 match many of our listeners don't know home and one or two cars that describes you you're the perfect candidate for free consultation to make sure your property and family are safe and properly covered we'll also dig out all the discounts preferred customers like you can qualify for. Call insure a match to compare multiple rates in carriers and 844 and 99 match let's 8449. B nine match insure a match works with the leading carriers in the industry Laker bella Plymouth Rock in more. Their license for all types of insurance can save you time stress the money just one phone call and one relationship. Called today 844 of 99 match or go online and ensure a match dot com. If you're real estate or property management company -- -- -- banking partner that has all the right tools to keep your operation efficient leader bank is one of the premier banks in the property management and real estate space offering a suite of unique products and cash management services to help you collect rent managed Condo association payments and digitize paper checks leader bank utilizes state of the art technology to offer convenient banking services to its real estate clients such as ECH payments mobile banking remote check scanners and its innovative -- rent payment platform leader bank has a team of business bankers that are on call to help you and they'll come to your place of business and make it as easy as possible the number to call is 8776917900. That's 8776917. B 900 find out why many of greater Boston's premier property management and real estate companies choose leader bank as they're banking partner call 8776917. To 900 or email BBO at leader bank dot com for more information member. Your team into the real life stories of the legal exchange with Susan powers of the Armstrong advisory group and Todd let's keep from the law firm of Cushing and building if you have a legal issues you might just to discuss on the show send us an email and we may read your story on the air contact us through our website at legal exchange showed does come up that legal exchange show dot com. Welcome back into the relay stories of legally exchange I'm Susan Paris a penny to resides in the Armstrong advisory group. And I'm joined by Todd let's. In taxation. On today's show we have Todd sky that he's written for the month of July. It's his operational guy to the use of light the states in theory of a global traffic if he'd been thinking about giving your home awaits your kids. Stop what you're doing you need to do it the right way. With the use of contrast perhaps the use of a late in the states they're not right for every one you need to find out if they are right for you if you are concerned about protecting one mean very well be your largest asset. In your primary residents call right now for your free copy of this guy 8668485699. That's 8668485699. If you prefer you can always download a copy. On our web site legal exchange showed dot com just click on the guides and articles tab and you can receive your copy. Right away. So Susan let's talk about the second situation. That's a situation where husband wife had come in and they wanted to do some plan. They came in with these preconceived ideas and New York Post is a lot of us that do that you know we know what we think we want and we need. Well hopefully that's why your coming to a lawyer or financial advisor because you want some council. You want some advice so they came in and they said you know friends keep talking about these. These are real estate trusts and they didn't they call them realistic tosses after what we need everybody uses these there their houses all seem to be Indies. Real estate trust can you just tell me what they are in and how they work. And then we'll talk about the planning. First of all folks. People come in with different ideas that the committee say I need a whale. We all know Susan that means I need state. But that's the late person's way of saying Chinese state chair Anita well. In this case they think well you know I think we might need more than that would use these realty trust's and they are real estate trusts. Folks when I got done explaining it to and it turns out we were even and use one at all. But that doesn't mean they didn't need trusts. So when you hear the word realty trust you need to understand the difference between that and a revote global trust and an era vocal trust yes. So realty trust as I explained to them is their friends probably took their house the only asset she'd generally put in real estate trusts. Is real estate share you don't put your brokerage account in your bank account it'll only. So that are ready limits the use. Of these realty trust. If you're thinking about planning your entire state you're gonna be planning for all your assets not just your home. Or just other real estate you're going to be planning for your iris and your investment portfolios in your bank accounts and the like. Okay that makes sense so I said there's one limitation. The next issue you have is oftentimes when you have these real estate trust set up. They're not really trusts in you really need to understand. What they're doing for. So I said your friends who have these trusts it would have been great if you ask them. Who the beneficiaries. Are on the attached schedule beneficiaries might is that manner time. Because a realty trust on like a revote Coble trust that we speak up or. And irrevocable trust that we speak health. Are not really trusts at all. Even though the word trust is in the idol. Which is what makes its way confused because they're written by attorneys. And he had a so our realty trust when you read through it has language in there that says. But trust key cannot act unless directed by the beneficiaries. Well that means that the beneficiaries are really the boss. I don't get your kids on there thinking that our beneficiaries begin at winning high near the mosque and they're not only are they the boss now directing what happens of the property. There really truly the owners well. Right so legal title would be in the trust to beneficial ownership would be what that. Beneficiary. So it takes affect right away not when you die right away. And so you might find that. You wanna sell that house. You really can't. If the kids analysts as the beneficiary because they don't. The other problem what that is. The kids and you'll find out in in a very bad way the kids get a divorce. That divorce lawyer finds this trust who they're gonna say hey year. You're currently the owner that's a marital asset right now wow. So there's creditor in control problems and operational problems and and lots more problems it'll explain. You know what folks you know or else there are creditor in control problems. If you have. A home and you put it in the name of your kids period or if you have a home he put it in the naming your kids and you reserve a like a state. There kind of box yeah wanted to ask kids permission to do anything with your own home. Call to request a copy of Todd sky for the month of July it's the operational guide to the use of light the states. An irrevocable trusts you can get your free copy by calling 866. 8485699. That's 866. 8485699. If you prefer you know he's download a copy on our web site legal exchange showed dot com just click on the guides and. Articles ten. And and so. That being said if you all have a real realist trust out there. Doesn't mean it's wrong. To ask a look at the beneficiaries. Right. If in fact the beneficiaries or someone other than that kids yes when it mom and dad. Let's discuss go there if it's mom and dad and at least she'd get yourself in any trouble. Much also doing things right as it goes from them to cast to them again exit but they're like still just the owner. Yeah I haven't really changed anything having avoided probate haven't helped reduce estate taxes. You haven't done any estate planning. Is kind of useless. It's not really even protecting it from any creditors casual right. The better way if you're gonna do a real estate trust is make sure those schedules of beneficiaries. Is either your family re vocal trusts that handle. All of your assets and cover your estate planning in a state tax reduction. Issues. Or the irrevocable trust that cover not only the avoidance of probate the estate tax planning issues. But also add that wrapper of nursing home protection. Then it would be okay. But even then going forward we've not for years now really used to realty trust's in connection with Medicaid irrevocable trust. As the state doesn't understand why would someone even need to use a nominee reality trust god we are we what situation would you envision it they would need sometimes when you're when you're setting up trusts it's it just from a convenience standpoint and a privacy standpoint. Making the beneficiary of it. Out rat a couple trust means that you don't have to put your trust on record and keep things more privacy is take this. Vanilla nominee realty trust and put that on record of it does provide some. And it's an ease of transfer ability later on I wanna take a house and transferred from one in my family trust in my wife's family trust perhaps. I would need to do indeed I can just do it change of schedule beneficiaries. And and I don't have to report anything else and so there some. Transfer ability flexibility involved in using them by. The most important documents anymore. Now informal people once they set up they're trusted they're doing revoke bowler eerie book while they're they're pumping it and change especially with like an eerie but global trust now what's there is there. Although I can tell you the side story I have what this is you know clients who. Who use them. Don't always remember how they wore right remember when you how to trust and an irrevocable trust situation the one thing we tell people is you can't borrow anymore. You can borrow before I put that in which can't refinance. Well turns out that there was someone who called up and said well what I did was we just apparently refinanced the house years after they set it up. In the bank of course wants to do the refinancing but can't so they changed the schedule beneficiaries took the property out of the realty trust put it back and mom and dad's name. Got a mortgage. And never changed it back. But even if they did it would be re starting a five year waiting period but you can't do it anyway because the terms of the trust prohibit that so others ill. There's problems if you if you don't understand how the nominee realty trust works. You might think you're doing something without realizing the ramifications of what you've done right when you play around the schedule beneficiaries. If you've got a nominee realty trust don't panic it's still okay. But if you're not sure who the beneficiaries are call your lawyer that helped you in just. Remind remind you you know who knows beneficiaries are you don't change and without getting some guys. Yet and you know what folks if you need to do and a state plane which is that revoke a dollar an irrevocable trust he need to go with someone who specializes. In this arena. A lot of times will books will go to the air feeling real estate attorney to do their statement. And that's how they end up maybe down the wrong path that's not the right type of plea and for them. What is the right type planned for you start I educating yourself and figure out does the life of state makes sense for you. Do you need to transfer assets to directly to any remarkable test we options vote. Call for a copy of Todd guide that is written for the month of July. It's an operational guide to the use of light the states an eerie vocal tracks. You can seek receive your free copy by calling 8668485699. That's 8668485699. If you prefer you can always go to our website legal exchange showed dot com click on the guides and articles tab and you can download your free copy right away. While you're out there you will feel that have that says ask god that's when you'll click. To submit your questions church hide. Which is what we're going to be addressing when we return in just a few minutes you're listening to toddler at the apartment with a lot from the Cushing in Dolan. I'm season power is an advisor with the arms to an advisory group and we'll be right back on the relay stories of the legally exchange. If you're real estate or property management company -- -- -- banking partner that has all the right tools to keep your operation efficient leader bank is one of the premier banks in the property management and real estate space offering a suite of unique products and cash management services to help you collect rent managed Condo association payments and digitize paper checks leader bank utilizes state of the art technology to offer convenient banking services to its real estate clients such as ECH payments mobile banking remote check scanners and it's innovated to see rent payment platform leader bank has a team of business bankers that are on call to help you and they'll come to your place of business and make it as easy as possible the number to call is 8776917900. That's 8776917. B 900 find out why many of greater Boston's premier property management and real estate companies choose leader bank as they're banking partner call 8776917. To 900 or email -- -- at -- bank dot com for more information member FDIC equal housing -- What are the most challenging aspects of -- life planning his understanding how to protect your assets from the nursing home if you worked hard and have accumulated wealth don't let those assets -- drained by an unexpected long nursing home state hi this is very are strong and I want you to know that the experts at Cushing and Dolan can help you they've got a new -- out this month that will help you create an estate plan that not only protect your assets from the nursing home but also helps you avoid probate and potentially eliminates the state taxes where do you need a life estate or inaugural will trust Cushing and Dolan can help educate you on the best course of action with the least amount of worry call their office today at 8668485699. And ask for your free guide don't impoverish or spouse -- -- lengthy stay in a nursing -- protect your assets now to ensure a sound retirement 8668485699. That's 8668485699. Or you can download the guide right now from their website legal exchange showed dot com. You're listening to the legal exchange and its time for. Ask. The segment where time will answer your questions about anything and everything that's included in the estate planning process once again here's Todd lets PN's Susan powers. Welcome back taught at these questions from listeners for you. First question comes from Joseph in Bangor Maine into a separate. I network an advisor who suggest that I purchase an annuity in transfer my home to my son in reits are alike ST. In order to protect my assets in the future from nursing home expenses. If I do this with they're still be a look back period on my house. Yes there would be. Let it. That the reason being is one I guess he's talking about assets and liquid assets and home and everything so look at what you don't. When you to a life state and again you mentioned Susan and the guide explains. There's two ways. One way is the way Jolie's been advised to do. Take the house. I guess here I assume you only has one child. Otherwise he would be dis inheriting other time joke and or other children so shall you need to make sure you understand that ramifications first and foremost. By giving it to one son and reserving elect a state that means that. All the other children will never get it because when you die what happens is the property would avoid probate. They'll like the state would extinguished. At your death. Merging into the remainder interest and now your child would own 100%. The sample of that property. And would not be obligated to give it his siblings right so I think you got to make sure we got that bridge cook covered first. Next you know when you do this desecrate a five year look back period for Medicaid are absolutely so either way you do it. Whether you transfer the house to that sun. And reserve life estate or you transfer that house to an irrevocable trust and reserve like the state. You're still gonna have the same five year low back problems you can't you can't get around ray. But that's okay. Two wooden and get the clock started. You know the other thing you have is when you when you do that. Yes you have defined your look back period but then you can go about living in your house that you know the life Tenet. You can collect the rent if you wanna rent it you get to pay all the bills and you get to live there. But knowing five years at the house would be protected it from the cost of long term care either way. I don't like the first way don't like the way Joe's doing it. Are being told to do but people do not want them and they'll at least there's some benefits were what they did do especially all your listeners. And then the way I would do it is I would say no if you're gonna reserve life stating you may not but if you're gonna reserve one. I I would transfer of the house to your vocal trust in reserve alight the state. You know. I think I would not always reserve election where Tony the three times that I would reserve missed. If you have a mortgage. Keep the lights and just easier way to preserve. The note to conceal clause. On the Mort. If you have eighty. Two family. And your renting it keep like state that we you can collect rent directly. Don't have the bother trusting you don't have to deal with the trust don't have the filing income tax returns for the trust. Just keeps your life simple oak and and really the most important time you wanna reserve this and folks you all know what it's very helpful when you go to your lawyerly your lawyer know. That you live in one of these few communities at least in Massachusetts but some states and I know this is main. Some states. Also have a similar real estate tax abatement. That she get icy some states how to because it's not just whether you. Get it from your town or because your over 65 sometimes they haven't for those folks veterans as well they have. It could very well be for veterans benefit and that could be in any state. You wanna make shore. That you are. Preserving. That. Benefit. And by reserving a life estate. You will. Always reserve that benefit. That's important and how about just this question about purchasing an annuity now with his liquid assets to protect them from acting on an anchor point yet. You know folks anybody who wants to have you purchase an annuity now to protect them from nursing home expenses as well. Just don't believe it. You don't buy it after years dinners and you can't buy it Medicaid in new audio right Susan that works until you're absolutely already in the nursing home. I'm not saying the annuity investment might not be a good investment I'm not an investment person. But please don't buy it for the reason that you think it's gonna protect the assets from the nursing home. Those are very specific and very special annuities that require certain terms. And conditions one of which needs to be in the nursing home right in advance that's something you buy later are right folks. It in the meantime if you have questions about lake estates and whether or not they make sense for you know. You can request a copy of Todd article that he's written for the month of July. It's his operational guides the use of life estates in here able global tracks you can receive your free copy by calling 866. 8485699. That's 8668485699. Or download a copy on our web site. Legal exchange showed dot com just click on the guides and articles cap. Todd next question to answer read it in Newbury port mass and read it right. My mom needs to go on Medicaid and had these substantial sum of money in her bank account. What can we legally spend this money on in order for her to still qualified for Medicaid to cover her nursing home care. So doesn't say how much that's substantial. Some number on annual New York port 900000. Just make it interesting could be more. I'm assuming read a single mean widowed probably. And and she's now going in the national and folks this is could be for a lot of few out there right. Whenever you're faced with nursing home admission as a family. You're going to be looking around at that moment saying to do any planning on any trust was anything on. It's not. I hope the next words out your mouth will be can we do anything now. And that's really where read news. And so the answer is yes we can do something interestingly enough jolt. And the question Pryor and talked about buying an annuity and I said that's not the time re read out. You're in the nursing home with 5000 dollars hypothetically in your name. Now's the time again so this is exactly the time you would wanna buy one of those annuities. Those dedicated at least but again this is the whole Medicaid application process is something you need to get help with. Q not to it on your own people like an advise you how to save that money they're gonna tell you yen chests bandit. Keep brightness to keep write that check on the nursing home until it down to 2000 dollars for a single person. And Daniel be eligible. That's not helpful. Right so. The one thing there's two options here depending on how old Ria news. If Reid is. Nate early ninety's. Yeah you know and depending on the size of the money. And you wouldn't mean work rank the annuity may be generating too much in common because of her advanced age. To really provide any benefit. If if you're at that age you may need to go with a pooled trust. Take the assets and assuming there's no real estate here just money take the assets put them in a pooled trust. That is eight permissible transfer. Meaning there is no five year waiting period on the transfer. And. The assets are immediately protected from the nursing home. And the assets can be used to benefit read while she's in the nursing home. And they can be invested and growing at the same time. The only issue is when a reader does pass there must be a payback provision in that trust to give money back to the state. Put at the Medicaid rate. So instead of paying 141000 a month and Medicaid rate might only be six. And then there might be some income coming in from social security and pension. And so though leaned. Or the rate of. You know accruing of benefits might only be. You know four grand a month. Good deal chair to go directly to your Medicaid now the other approach would be that continuity. If you're young enough and if the calculation of your life expectancy is you know. I don't know could be five years could be ten years you know you divide that number 500000. By your life expectancy. So it's it's ten years in this case it's fifty grand a year so would kick out fifty grand a year and divide that by twelve to get to your monthly payout. Yet. That amount needs to go to the nursing home every month. But now you're on Medicaid because you've magically made by buying the annuity you magically made the annuity the money disappear from an asset. To an income stream right and you're on Medicaid same kind of analogy as what the pooled trust so it and it's it something that can be done need help. If you have a question you would like to ask Todd visit our website legal exchange showed dot com and click on the asked Todd tan. Media will be able to read your question on the air and hopefully hits in answer we'll stop you from being one of his next real life story. In the meantime if you have questions about life in states today makes sense for you what are they who she consider using them. Todd Skype is written for the month of July it's an operational guide to the use of light the states in Erie remarkable trust. In this may be one of the tools that you should consider using. To protect your primary residence or your primary residence that happens to be rental property as well. Call for your free copy right now 8668485699. At 8668485699. Or visit our website legal exchange showed dot com. Click on the guides and articles tab you can download your copy right doing if you miss any of today's issue you can also. Listen to our podcasts. You're listening to toddler at the apartment with a laugh from the Cushing and Alan and Susan powers they need to advise it would be Armstrong advisory group. Reading take a quick break and we'll be right back with mark on the real life stories of the legally exchange. What are the most challenging aspects of -- life planning his understanding how to protect your assets from the nursing home if you worked hard and have accumulated wealth don't let those assets -- drained by an unexpected long nursing home state hi this is very are strong and I want you to know that the experts at Cushing and Dolan can help you they've got a new guide out this month that will help you create an estate plan that not only protect your assets from the nursing home but also helps you avoid probate and potentially eliminates the state taxes where do you need a life estate or your local trust Cushing and -- can help educate you on the best course of action with the least amount of worry call their office today at 8668485699. And ask for your free guide don't impoverish or spouse -- -- lengthy stay in a nursing -- protect your assets now to ensure a sound retirement 8668485699. That's 8668485699. Or you can download the guide right now from their website legal exchange showed dot com. Your financial strategy has to include a thoughtful insurance plan. Insurance exist to protect your assets our friends at the insure a match agency can prepare personalized plan that gets you the best coverage of the best price. Call insure a match at 84499. Match let's before for 99 match many of our listeners don't know home and one or two cars that describes you you're the perfect candidate for free consultation to make sure your property and family are safe and properly covered. We'll also dig out all the discounts preferred customers like you can qualify for. Call insure a match to compare multiple rates in carriers at 844 and 99 match let's 84499. Match insure a match works with the leading carriers in the industry like our bella Plymouth rock and more. It's just one phone call and one relationship. Well today 84499. Match or go online and ensure a match dot com. You're listening to the real life stories of the legally exchanged we Susie powers and Todd let's game. Susan until they've been helping people solve their legal problems for years and they can do what's presumed to. Be a part of the show by emailing us your story on our website at legal exchange showed dot com that's legal exchange show Todd come. Welcome back into the relay stories that the weekly themes on season powers a financial advisor with Armstrong advisory group. Enjoying by Todd left the apartment with a lot from Cushing and Allen with a masters in taxation. On today's show we have Todd skied that he is written for the month of July. It's an operational guide to the use of late has stayed in Erie book global traps. In if you've been thinking about bypassing the attorneys and just giving your home away your children in order to protect it from those long term care expenses. You need to stop. Don't do anything until you have read this guy because there are so many pitfalls that can occur when you just give your assets away. Like your home being at risk for each child getting a divorce or other creditors and your children. Let alone if you dodged that bullet you really wanna have to ask your children's permission. Sell your own home in non. Call for your free copy of this guide. 8668485699. At 86684. C 5699. If you prefer you can always download a copy on our website legal exchange showed dot com just click on the guides and. Articles. So Susan is the last situation. And and this is one where you know a lot of you might find yourself in this situation it's almost upper crust and is some story. But at least there's just something you can do. I think it's a depression is a story because we had a husband and wife but only the wife came to the meeting. Because husband died in January of 2016 and so wasn't that long ago. But. You know. The question is there worth about one point five million in and it turns out that as I met with them met with hat with her. All the assets were owned jointly. And so I guess that's not bad the IRA had a designated beneficiary her in the life insurance had designated beneficiary her and she's now worth one point five million so it's not bad from me convenience. Perspective of when the husband died in terms of the surviving spouse that's right zoning goes over to the wife no probate. No tax return easy piece that's exactly right and I think up a lot of people need to understand why. That happened that way and how what happens. In this case. When you have no planning done. The surviving spouse as you just explained it's Susan says. That was easy. I got everything. I didn't go to program and file a tax return of the joint. They know must cut term answer it and it didn't so at least in this regard you know you wipe your brow and you say. Good I I'm. I've at least got what I need and on a golf hole. Problem is. She's now worth one point five million. And what's the Massachusetts state tax. Exemption it's a million by. So she's now worth more. And the estate tax exemption explained but how big complaining before January at sixteen when he died and we could have eliminated. The estate tax liability that if she dies. While there was none when he died there will be some when she guide that kids have to pay. So how much the estate tax the itchy state maintains this one and a half million so that doesn't grow. And she just lives on. The tax would be about 64000. To mass. You know. Is it a lot Knoll. But a lot of money people agree and that's and I agree in proportion to the one point five million sales look it's not as much when you look at it compared to one point five million you know what. We don't like taxes in general. And we really don't like taxes. Don't pay so if they had done their trust cleaning whether it's revoke bowler here evil global before he died. What with the taxes and on a million half dollar state between the two. It would be zero so the Medicaid relatively speaking 64000 dollars is a lot of money. When it could be napping it's going to stay. Right because if they had to trust in place. Potentially about half seven you know each what do we don't know was gonna die first set it up so. You kind of balance the assets between the two trust should be able to carve out about 750. On the first death rate in subject 750 to taxes when the husband died. And own it in a way that the surviving spouse will never have to have attacked in the surviving spouse is a state. But the surviving spouse can benefit from it from the deceased spouse's trust so we just to clarify when you say subject. The deceased spouse's estate. Attack attacks that's not. They attack that's filing reach right in and you file their return and if it says the tax the light that day value of the estate is 750 minus a million dollar exemption. That's no tax write and that's why you do the planning and don't make gifts to the state short to the Fed if you don't have to. And that folks is he's really the 64000. Dollar question. Call to get a copy of Todd guide for the month of July it's an operational guide. To the use of light the states in Erie evoke about trust these lifers states are what you would have on you our primary residence which. For most of us is going to be our largest. Asset find out the right way to own that asset DN Neal like this date. I don't know Todd sky it's gonna explain to you whether or not it makes sense for you in your feeling to have it. Call for your free copy of this guide like escaping very vocal track. 866848569. At 8668485699. If you prefer you can always download a copy on our web site legal exchange shoot dot com just click on the guides and. Articles. So. Now we've gotten past the boob and part of not planning a big round of an ancient part of not planning for this couple and I'm hoping all of you can learn from that so you're still married. It's not too late Ernie or I should say still married and no one as instant high ethical life. It's not too late source sir is it now what kind of planning to do for her now she hasn't done any planning. And realizes that in says you know what I'm 76 and I better you know. I dodged a bullet when my husband died so to speak. But I don't want. The bad things to befall the children race. She can still do planning and in her case will take the 1000005 and and will work on what goes in the trust's first what kind of trust. Well but the trust will avoid probate when she dies which we certainly need because while they avoided probate. When the husband died that was because of the way the assets were owned and now all likely the assets were albeit in her name alone. With no beneficiary so like higher rate than brokerage in other accounts chic and put it beneficiary but don't put a beneficiary on real estate. Correcting even if you can't put a beneficiary on. What I've learned is when people don't do planning during their life and one's spouse dies. They likely are not doing complaining when the survivor dies because they don't never thought about may not be updating beneficiaries of in my opinion. And that's a problem. So that's number one. Number twos then we settle what kind of planning do you wanna deal in based on the size of her state in the house being one of the larger assets. She didn't want to protect these assets from the costs of long term care and right okay well that type of trust we're gonna do for you is irrevocable. And will get the assets and will determine which assets go in house and probably some investment accounts. In which asset state outside the trust IRA season. Be some investments may be small bank account. And then you'll get your five year clock started you'll be avoiding probate you'll be living your life. And most importantly. Ease even believe in protecting it from the nursing home but what have you not done. You still haven't avoided the estate tax this planning a long way. Cannot avoid that estate tax is there anything cheek did you daring her lifetime. To reduce the size of her state in order to reduce those taxes or even ultimately eliminate them that's it's a tough call and again it's not a big number I mean it it it is but it. You gotta think about what her overall objectives are now could she make gifts yeah. Maybe it doesn't wanna give away a money race who wants to let you know she wants to win use use it to enjoy until Yvonne. And even if she did think about making gifts she could be creating new five year waiting periods everytime she makes the gift. So that and ends up hurting you on the Medicaid planning front. Seek kind of got to think about all the aspects of the plan before you decide to take an action. I think at the end of the day probably she wouldn't. But if she really wanted to reduce the planning and didn't and reduce the estate tax and didn't mind making gifts. I would director to make tips from the trust OK because the trust would allow you to make gifts to children. Not back to you but to children. And then the children could just keep senate and that would get it out of her estate without starting a new five. A waiting period so there may be an opportunity for folks who are single weathering he never married or widowed divorced had. Maybe reduce the guy that tax definitely opportunities exist definitely things that can be done folks. Educate yourself before you just keep your stuff away. Don't fix kid's name on your home don't put it in the Iranian enemies are alike can state without reading rods guide first. It's an operational guide to the use of life as states. In Erie vote global trust him while reserving the light the state is certainly less bad than just giving your home awaiting your kids. There are pitfalls associated with you need to figure out what they are tied in detail on them call for your free copy of Italy the State's guide right now. 866. 8485699. 866848668485699. Or go to our website legal exchange showed dot com you can download your article you can listen to our podcasts out there and you can submit your questions for Todd. Then let giving away free advice on his behalf. Todd lucky from a lot from Cushing and Allan thank you so I'm not Syracuse isn't always a pleasure. Science is in Paris a financial advisor with Armstrong advisory group sweet thank you for listening. And we will be back again next week on the real life stories of the legally exchange. Securities offered through securities America member finreg SIPC advisory services are with the securities America advisors think securities America and its representatives do not provide legal advice therefore it's important to consult with your legal advisor regarding your specific situation ashamed on the Armstrong advisory group relayed stories of the legal exchange and securities American companies are not affiliated. Preferred stocks are unique investments they can be an effective part of a financial portfolio but it's important to understand the various types and the various benefits that come with any purchase hi this is Barry Armstrong there are several types of preferred stocks including straight preferred and cumulative preferred you can also purchase preferred stocks through exchange traded funds or ETFs if you own preferred stocks or are interested in adding them to your portfolio called now for my free guide to understanding the basics of preferred stocks call 803934001. That's 800. 3934001. Call now 800. 3934001. To get my free guide for you can download the guide rate now at financial exchange showed dot com. Securities offered to securities America incorporated members Jenrette SAP C and advisory services are printer securities America advisors incorporated. Gary Armstrong representative Armstrong advisory group in the securities America companies are unaffiliated. 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