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]]>Recently, we did some planning for a mother and her son. This involved plans tailored to each and creating joint estate planning documents such as trusts and LLCs. Because they had acquired some new property, we updated their titles to coordinate with the deeds and LLCs. We are telling you this because the client discussed a fascinating story that aligns with this blog’s title.
Here’s What Happened:
The client lives in the Gainesville area and is at the shopping center on Dawsonville Highway. This took place around mid-September, and it was cloudy with the possibility of storms. She’s sitting at the intersection. Anyone who has ever been here would quickly attest to how busy this intersection is. You’ll sit through several iterations of red and green lights before it’s your turn to go. She was about the third car in line, waiting to turn out of the shopping center’s parking lot.
Then she heard the loudest bang she’d ever heard.
She described it as if a cannon had gone off inside her car. Now, when you read that, you’d assume that someone ran into her or perhaps a significant object had hit her. Her car had been struck by lightning. It went from hazy to a flash to a bang for a few seconds.
She may never have fully realized what had occurred had she been alone. The man behind her asked if she was ok, and fortunately, she said she was. But he let her know what he had seen. When she was outside the car, she noticed a hole in the roof of a vehicle about the size of a baseball.
The Aftermath
The car was completely disabled. Ironically, there wasn’t a dent in the car, but it was completely totaled. Accidents, by nature, are unexpected, and in many ways, they are unpredictable. When the woman left her house that morning and said goodbye to her dog, no one could have known what would happen. The frightening reality is that anyone could sit at a red light on a partly cloudy Thursday and be gone.
You never know. Attorney J. Kevin Tharpe had a conversation with his mother the day before she hit her head and had to be rushed to the emergency room. Incapacity happens that quickly. Despite everything we just mentioned, there are still ways to be prepared for the unknowable. Here are two of them:
Contact J. Kevin Tharpe, P.C.
Your story is a powerful reminder of life’s unpredictability and the importance of being prepared for any eventuality. The experiences shared here illustrate the unexpected nature of accidents and the critical need for strategic estate planning.
At the Law Offices of J. Kevin Tharpe, P.C., we understand the significance of protecting your assets and ensuring you maintain control over them, even in unforeseen circumstances. Our approach focuses on creating comprehensive plans that safeguard your interests and provide peace of mind. Whether setting up revocable trusts, updating estate plans to include new properties, or ensuring that titles and deeds adequately align with your estate planning goals, we’re here to guide you every step. Don’t leave your future to chance; schedule a consultation with us today to ensure that you and your loved ones are prepared no matter what happens.
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]]>Financial advisors are not estate planners. They gather documents but cannot do the same tasks with them in the way an estate planning attorney can. For instance, financial advisors can’t review them and offer legal estate planning advice. Financial advisors often tell you that they don’t need to see your legal documents or have them on file to review them when something happens because they simply aren’t attorneys. If you have questions about needing a trust, contact an experienced estate planning lawyer.
From a lawyer’s perspective, we respect the financial advisor’s role in giving investment advice. Conversely, your attorney cannot explain to clients whether they should pursue a specific investment. Should I take this inheritance and pay off my house, or should I keep it going and get the mortgage interest deductions? These are questions for financial advisors despite the concern being rooted in an inheritance. If we receive these types of questions—which we do—we will defer to another professional in a position to field it.
Lawyers & Finances
At what point do attorneys venture into the financial arena? Number one, we aren’t concerned with how your assets are invested (land, stocks, bonds, annuities). We will hone in on how that asset is titled (you will know that a title means everything if you read that previous blog). We get calls from people regularly about how their loved one has passed away, and we quickly realize that we are one of their last calls. Even more surprising is that these same people will say they spoke to their financial advisor before us and are under the impression that they do not have to go through the probate process. Their concern is that their bank tells them they must go through probate. Here’s their question: What do we need to do?
They will schedule a consultation with us because they want us to help them probate the will. It may take us as little as fifteen minutes to determine (and inform them) that they can bypass probate altogether. How can we arrive at that conclusion so quickly? Because we ask them how the assets are titled. Beneficiary on the IRA? No probate. We titled the home in the name of a trust. No probate. During this conversation, they frequently ask why other people tell them they must unnecessarily go through the probate process. The main reason is that other professionals, whether they are financial advisors or work at a financial institution, are reaching into areas of the law.
Where Mistakes Happen
In many instances, a bank may say that someone needs to go to probate because this is what they were told to say after receiving some training on the matter. Their first action may be to freeze the account and inform the relatives to go through the probate process. It also extends beyond this – Insurance companies may tell people that a specific policy left to someone is tax-free. It could be income-tax-free, but that doesn’t mean it is exempt from estate taxes.
Regarding inheritance tax, it is $11 million per individual ($22 million for a married couple) before your kids have to pay estate taxes. This total includes everything you own. Assets such as life insurance term policies are included in this. (When attorney J. Kevin Tharpe was newly married, the limit was $600,000—and he owned a $1 million life insurance policy. If he had passed away, then his spouse would have owed estate taxes despite having few assets—which is very typical for young couples.) In other words, never underestimate what you are worth. In 2026, the estate tax limit may drop closer to $5 million.
Kevin Tharpe, P.C.
With years of experience in elder law, estate planning, and special needs planning, we understand the importance of accurate, personalized legal guidance. Don’t let misconceptions or incomplete advice lead you astray. Schedule a consultation with us today, where we’ll provide you with the clarity and direction you need to make informed decisions about your assets and future. Our approach is not just about documents; it’s about offering peace of mind and protecting your legacy.
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What is the best form of beneficiary designation?
We hear this from many of our clients—or prospective clients. This happens when we prepare someone’s estate plan. We’ve gone through the steps of their wishes, and they’ve signed the document. We’ve explained how to title their home in the name of their trust and sign and record the deed. We’ve even given them paperwork about retitling their bank accounts, and then we get to “beneficiary designation.”
We commonly own a group of assets that allow us to keep ownership while naming a beneficiary. These are things that don’t need to be placed in a trust. For example, this could apply to life insurance policies, retirement accounts (IRAs, 401(k)s, 403(b)s), and annuities. Many banking and brokerage accounts now let people designate beneficiaries in the form called Payable on Death (POD) or Transfer on Death (TOD).
We hear a common concern when discussing beneficiary designations, especially retirement accounts. Some financial advisors tell their clients that they don’t need a trust for their IRA or 401(k) because they have already named beneficiaries. People frequently make their spouse or their children the beneficiary, so they assume they don’t need a trust for that. So why would they need to discuss these when we go over the tilting of assets?
What You’re Not Seeing
Well, you don’t have to have that discussion. You can choose whomever you want as a beneficiary. But let’s talk about what happens when your spouse or children have beneficiary designations. You’ve followed the advice of your financial advisor, and you don’t have a trust. Your spouse or children are your beneficiaries.
Now, consider a scenario where you pass away first, and your spouse survives you. When you made that choice several years ago, your spouse was in good health. In many cases, there is a significant time between when you named your spouse as a beneficiary and when you passed away. Maybe your spouse’s health has declined to the point where they need to be in assisted living or a nursing home. What happens then?
The surviving spouse will receive that money regardless of whether they are in a nursing home. There is a legal obligation to give the money to the beneficiary. The critical question you must ask yourself is whether the beneficiary is protected. The answer is simple: no. Every advisor should understand that there are potential consequences for the advice they are offering to their clients.
How We Can Protect the Beneficiaries
Because of the scenario we just outlined, we recommended that the trust be named as the beneficiary. Your trust takes into account the condition of your beneficiary. The money will go to the surviving spouse through the trust. However, the trustee can keep that money in the trust for the benefit and protection of the surviving spouse. Why? The surviving spouse’s creditors, including the nursing home, cannot reach it. You receive this protection when you title your IRA’s beneficiary designation in accordance with your trust. Beneficiary designation is a component of estate planning, not estate planning.
Build Your Estate Plan the Right Way
Titling has consequences, yet beneficiary designation from an estate planning and asset protection standpoint is one of the most overlooked but most important things you can do. It is becoming important because many financial institutions allow you to name a beneficiary. Beneficiary designation is a conversation you should have with your estate planning attorney rather than your financial advisor. Trusts are the best beneficiary designation. Contact us today to schedule a consultation to continue this conversation with an estate planning attorney.
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When we meet with clients, we get asked whether it makes a difference whether they have an estate plan. Before we walk them through the process, we ask what estate planning means to them. Because of how frequently estate planning myths are perpetuated, people responded that they don’t need a plan due to how few assets they own. Or they say that the assets they do have aren’t valuable enough to warrant a proper estate plan. We will address the 800-pound gorilla in the room by stating that estate planning is about what happens to our assets when we die—and this is a question that applies to everyone.
Although this applies to our mortality, we also want to highlight that we have yet to meet anyone who doesn’t own an asset. Regardless of your status, everyone has wishes about what should happen to their assets when they pass away. People have spouses, children, and even businesses. When you die, what are your employees going to do? Protecting your business is a means of safeguarding them. The only way you can answer the question about what happens to your assets when you pass away is by having a complete estate plan.
What Is a Complete Plan?
Now, there is also a significant amount of confusion as to what a complete estate plan is. Many believe it comes down to having a single document: a will. If you think that having a will constitutes a comprehensive estate plan, you’re not alone. Many professionals throughout the country have emphasized this. Financial advisors, individuals, and even lawyers have given this myth legs. The fact remains that having a single document is not a plan. It can be a piece of one.
Documents alone are not enough. What makes the difference is having the title of your assets coordinated with that document. It is as fundamental as it is overlooked. One of the biggest things we want to express here is that this cannot be achieved with a will. It can’t. Again, don’t feel alone if you think this. Frequently, clients come to our office and say that they either want to update or draft a will. We emphasize title because the difference in an estate plan comes down to title. If you haven’t coordinated title, you don’t have a complete plan. Title means everything, especially when looking at what happens to your assets when you pass away. If your document and the titles of your assets are not coordinated, then there will be extra steps. (Again, you can not do this with a will.)
The Extra Steps
One of those extra steps (and this is guaranteed) is probate. If a will was enough, meaning it could serve as a complete estate plan, then there would be no need for probate. So when conversing with anybody, mainly a financial advisor who gives estate planning advice and proposes certain documents, ask them this critical question: How does beneficiary designation impact the document you are suggesting? They won’t be able to answer that. Or if they tell you the truth, they will say that titling beneficiary designation completely negates whatever you put in your will. If you walk away with nothing else, remember this: Title trumps everything.
Make a Complete Plan Don’t leave the future of your estate to uncertainty. Effective estate planning transcends a simple will; it’s about ensuring your legacy and wishes are honored without burdening your loved ones. Take a step toward securing your legacy by contacting J. Kevin Tharpe P.C. today. We are ready to ensure your assets are appropriately titled and your plans are fully executed. Act now for peace of mind—call us, email, or visit our office to set up a consultation.
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What are the words written on the side view mirrors on your car? It says something along the lines of, “Objects in mirror are closer than they appear.” This warning is because the mirror is convex and curved outward. The convex shape allows drivers to see more of the area behind and to the side of the vehicle, essentially providing a wider field of view and reducing blind spots. The reasoning behind bringing this up is that we like to use this analogy for discussing joint ownership—because it isn’t all it seems to be.
Joint ownership is convenient, especially for married couples who acquire and own assets, such as their home, banking accounts, and investments. However, retirement accounts and 401(k) plans can never be jointly owned. It is common for married couples to purchase homes in both names. Although we pointed out that it is convenient, it is also how people plan estate. We have heard of at least one attorney referring to “joint ownership” as the poor man’s estate planning. When you own everything jointly, you have a plan built in because—in most cases—when you pass away, the assets default to your spouse.
The Wrong Assumption
Some people believe there is no need for estate planning because they own everything together. It is a common way to title assets, and you know how much we stress that title trumps everything. The concern is that people hold onto the belief that joint ownership negates the need for estate planning.
Think about the couple who purchases a home jointly and are told they must protect their investment. They may then go to an attorney and have a will drawn up stating that everything goes to their spouse when they pass away. Ironically, because of how they titled the home, it negates the will. A bedrock legal principle in estate planning is that the title always wins when the title says X and a document says Y. The title dictates what happens to that house as opposed to the will. The scary truth is that many couples’ titles and documents must be coordinated.
What does this mean for you? If you are going to spend money to create an estate planning document, ensure that you also have a conversation about how your assets will be titled. Here’s a simple test: Take a look at your bank statement. If you have a joint bank account, that will override anything you have put in your will regarding where the money goes when you pass away. We want to highlight the problem of joint ownership negating your estate planning documents.
Secure Your Legacy Simply and Securely
Ensuring your wishes are followed, and your assets are handled correctly after you’re gone can be confusing and complex, especially with joint ownership. At J. Kevin Tharpe, P.C., we’re here to guide you through every step of estate planning and elder law with experience and kindness. Your peace of mind and clear, simple solutions are our top priority. Don’t leave your legacy to chance—reach out to us today. Let’s create a plan that makes sure your assets tell the story you want them to, securing a future for your loved ones that’s both strong and straightforward. Contact J. Kevin Tharpe, P.C., and take that vital step to ensure a legacy that speaks true to your wishes.
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One of the true joys in life is discovering a passion. The focus may range from driving the country to viewing covered bridges to riding roller coasters. Though we are about to discuss the latter, it doesn’t matter what people are passionate about; finding something you value and appreciate is genuinely important. The American Coaster Enthusiasts (ACE) have an annual marque event called Coaster Con. Members meet at different theme parks yearly, get early access to rides, and spend time with like-minded individuals. This began in 1978 at Busch Gardens in Williamsburg, VA. A little over 50 people attended. Now, upwards of 800 people congregate each year. Some of them ride thousands a year.
Whereas this may seem out of left field for a legal blog based on estate planning and elder law, we will highlight that attorney J. Kevin Tharpe has spent a fair amount of time riding them, although he is not a card-carrying member of the ACE. Furthermore, he is fortunate to have found a career he cares deeply about. Because October is Special Needs Planning Month, we want to highlight that this term can also apply to incapacitated adults. Many of the things we are about to discuss in this blog apply to it directly.
The Ups & Downs
Today, we will use the roller coaster metaphor to discuss what you can do legally to weather the roller coaster of the economy and your life in general. For instance, attorney Tharpe’s father’s primary focus on estate planning is that his wife was cared for when he passed away. It’s an act of love that many married couples can relate to. His father was convinced that he would pass away first.
Life doesn’t happen on people’s timetables. Sadly, his wife endured some serious health issues. However, that only fueled his desire to ensure she was provided for if he wasn’t there to support her. One thing he did was obtain life insurance policies for himself. This was a conscious effort to take care of his wife.
The First Step Toward Peace of Mind
The first thing he did was to change from a will to a trust. The reason for this was that by doing that, he would help his family avoid going through probate. There would be no delays or waiting, and the rest of the family could immediately care for his wife when he was gone. His wish was to leave by a seamless transition. Everything the family had been doing to support his wife would continue without the pause the probate process would naturally create.
Anyone who has worked with us or read our blogs knows that when you switch from a will to a trust, you can change title—precisely what he did. For instance, attorney Tharpe’s parents had joint bank accounts. If his father passed away first, all that money would default to his wife, regardless of her condition. Joint ownership does not take into account the condition of your surviving spouse. Remember, the bank may advise you to create a joint account, and the insurance agent may tell you to make your wife the beneficiary. Though you can, this doesn’t mean it is best to ensure your spouse is provided for when you are gone. If your spouse is incapacitated, how can you change this?
Kevin Tharpe P.C.
Life’s twists and turns can be as unpredictable as a roller coaster. Secure your legacy and provide peace of mind for your loved ones with thoughtful estate planning. At J. Kevin Tharpe P.C., we craft plans tailored to your needs. Navigate life’s uncertainties with confidence. Don’t leave your legacy to chance. Schedule a consultation with J. Kevin Tharpe P.C. today and ensure your loved ones are cared for, no matter what the future holds. Your family’s well-being is worth it.
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Many people fall for a basic trap or misconception that they have a sufficient estate plan because they have one document: a will. It’s the document that most people are familiar with. This concept is embedded in our culture and entertainment. Hamlet, for instance, is worried about his father’s will because it disinherited him in favor of his uncle Claudius. Knives Out, released in 2019, depicts the famous Hollywood-created “reading of the will.” (This can also be seen in the classic Brewster’s Millions.)
Anyone who has listened to our show, Truth and Planning, or has read any of our content, understands that a will doesn’t impact title. In this regard, it is not the all-encompassing, one-stop-shop document that people believe it to be. This misunderstanding may be from movies, television shows, and other widely consumed media.
Breaking Down a Myth with One Question
This universal question applies to all of us: What will happen to our assets when we pass away? It’s a question that we ask our clients because of how telling their response is. And this is when people say that they have a will. So, let’s take the classic movie scene when a will is being read. It gives this to one person and that to another. Imagine that in this scene, the goofy nephew in college randomly gets the mansion. The lawyer read it right off the will.
However, in reality, the nephew then goes to the lawyer who read the will and asks what he must do before moving into the new mansion. The lawyer then says, well, the house is titled in the name of your uncle and his brother—and the brother intends to move into the mansion with his girlfriend because his name is on the deed. Why is the nephew not getting the house passed down to him through a will? Because title trumps a will! In light of that, ask yourself what that will is worth. For the fictional nephew, nothing.
A document alone is of no value to you in estate planning because title dictates everything.
Another way of looking at this is that if you own a home jointly with your spouse and have a will that leaves everything to your daughter, your daughter will be very disappointed when she doesn’t get the house. Furthermore, you may pass away thinking your affairs are in order when, in fact, they are not.
Here’s Another Question
If you have a will and the titles of your assets don’t reflect what is in your will, then you are likely wondering why your attorney didn’t tell you this. This monumental discussion should have occurred when you drafted a will. Don’t immediately jump to the conclusion that you were deceived or misled. Many attorneys are trained to select the correct document that meets the client’s needs, especially regarding estate planning. There is simply more to estate planning than choosing documents, despite what we have come to believe through movies.
Get it Right
Let’s go beyond Hollywood and the theatrics associated with a will and consider trusts. Trusts are a complete estate planning document that can work in conjunction with appropriately titled assets. And this can be done while you are alive without giving up ownership of your assets if you use a revocable trust. Completely walk away from the concept of the “reading of the will” and choose an estate planning path that reflects your intentions. Contact J. Kevin Tharpe, P.C., to schedule a consultation.
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]]>Before we go on trips, we take the time to plan. We find someone to watch our pets, and we have packing lists. If something gets forgotten, there’s usually a way to replace it when we get to where we are going. However, what happens when we die? What sort of preparation did we do? This is precisely why estate planning exists. It answers what will happen to my assets when I pass away. There are things we can do that will make the transition easier for those we leave behind. This blog centers around specific things you can do to make that happen.
#1: Put Your Wishes in Writing
There are a couple of documents you can choose from to accomplish this. When people first hear that they should put their wishes in writing, they typically think of a will. This is probably one of the least essential documents you can have, despite how many people are familiar with a will. We’re not saying a will isn’t needed, but it is one of the least important things. This document will not truly answer the question of what happens to someone’s assets when they pass away.
After reading that, people’s next question is what they should do. You need to put your wishes in writing and then title your assets in accordance with that document. With that in mind, it is safe to say that a will doesn’t fully prepare you because a will is missing title. For example, you cannot title your home in the name of a will. With a will, there will be extra steps that your family has to take to accomplish the goal of getting title to your assets over to your surviving loved ones. The absence of title equates to the presence of probate.
#2: Choose a Revocable Trust
A revocable trust is a legal document that contains your wishes about what you want to happen when you pass away. You have the option of being very specific or very general. The fundamental advantage is that you can title your assets in the name of a trust because the trust becomes effective while you are still alive. In contrast, a will is not effective until you pass away, which is why you cannot title your assets in the name of a will.
When you title your assets per your wishes, you eliminate the need for probate. We live in a world full of “what ifs.”
All of these can be taken into account in your trust. Everything will be carried out as you intended without the extra step of probate. If you want things to remain simple, the first step is to ensure that the government and the court stay out of this.
Get in Touch with J. Kevin Tharpe, P.C.
Most people want their lives to remain private, and having a will is anything but. Many people don’t want their personal details, assets, and the names and addresses of their surviving family members published or made public. Having this trust keeps your life private, and more importantly, you will be prepared. Your family will also be prepared, and you will make things easier for them when you are gone. Your beneficiaries will be protected too. Put your wishes in writing and coordinate the titles of your assets accordingly, and you will be prepared. Contact our office today to continue this conversation with legal counsel and schedule your consultation.
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]]>After more than three decades of practicing law, we have encountered people in various stages of life, all of which are navigating challenges. Everyone struggles and feels degrees of pain, but we have found that there is one thing that everyone has in common: We are all going to pass away. There is a spiritual element to this, and people seek different ways to process their mortality to be ready for that stage. This is an uncomfortable topic, and we have firsthand experience with it because we meet with clients and speak in front of groups about it. At our core, we help people with the legal elements associated with passing away.
Whereas being ready is spiritual, the question of being prepared falls into the legal realm. When we ask our clients and other community members if they are prepared, they often tell us they are because they have a will. Typically, they add that they must update their will to reflect their current situation accurately and wishes. When asking if you are prepared, the answer has to be more than just having a document. What steps do we need to take legally to be prepared for when we pass away? There are two things.
#1: Put Your Wishes in a Legal Document
We have seen countless families that say they know what the deceased would have wanted. We have witnessed families splitting up at funerals because of disagreements about how the services should have gone. Put your wishes into a document, whether they are detailed, specific, or general.
The most common document people use is a will, but you have heard us say this before. Having a will is like building a car and never putting an engine in it. Like the engine-less, a will alone is not enough. Why? If a will alone was enough, probate would not be needed. There would be no need to prove the will or carry out the extra steps to execute it. More importantly, more than a will is necessary because it needs title. This is why probate exists. You cannot title your assets in coordination with that will. Do you have a retirement account? If so, you cannot name your will as a beneficiary. The same applies to a life insurance plan and several other assets. In this sense, you are not prepared because there are extra steps your family must take.
Trusts allow you to express your wishes and title your assets in accordance with it. This is being prepared. Coordinate your wishes and title.
#2: Are You Prepared to Go into a Nursing Home?
Statistically, from our experience, we are all living longer. But the longer we live, our bodies decline, giving way to serious health issues. This is why long-term care facilities exist. Are you prepared for it? In this area, it can cost you upwards of $10,000 per month. The longer we live, the more likely we need this level of care. Government benefits will only help you pay for care outside of a nursing home.
You can be prepared for this by focusing on three things:
Speak with J. Kevin Tharpe, P.C. Today
If anyone tells you you must give up ownership to be protected, we urge you to get a second opinion. This has negative consequences, and we will outline what they are when you speak with us. We encourage our clients to keep ownership of their assets because we want you to be prepared. Contact our office today for a consultation, so we can help you be truly prepared.
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]]>It isn’t a hurricane, tropical storm, or an old name that is making a resurgence. IRMAA is an abbreviation for Income-Related Monthly Adjustment Amount. It may land as a significant surprise for anyone who is in retirement. Think about the person who is retiring and is getting Social Security. But what happens if you are fortunate enough to have a lot of retirement income? The issue is that you have more money to spend and live, but you also have a higher tax burden.
IRMAA applies to people whose income is over a certain amount. The IRS goes back to your retirement income from two years ago. If you file in 2023, the IRS examines the taxes you paid in 2021. Why is this important? Because that amount determines what your Medicare insurance premiums are going to be. The result is that Medicare insurance isn’t the relatively low amount you thought it would be—and this is a monthly expense. You could go from paying $80 a month to $250. It’s a possibility that you could pay more in Medicare premiums than for health insurance when you were working.
As people get older, many are looking for or expecting tax breaks. For example, we get taxed twice for Social Security. Once when it goes in and once when we receive it. The key is to begin planning for it now with the proper professionals, which will likely involve a financial planner and an elder law attorney.
Now, Let’s Talk About Planning
With that in mind, remember, when it comes to planning, many things are exactly what they say they are. When people face increasing Medicare premiums or realize they don’t qualify for Medicaid, they may take action. Depending on who they are talking to and getting advice from, they may begin to resolve the issue. Don’t make the problem worse.
For example, because we work closely with trusts, it is essential to say that an irrevocable trust is precisely that. (There are also revocable trusts, which we recommend for 99% of our clients.) Why do we not tell most people to make an irrevocable trust? Once you set up an irrevocable trust, you can’t take it back. It’s permanent. In other words, you are giving up access, ownership, and to some extent, control. Many people opt to create them because they are ideal for asset protection. They cannot come after the assets inside the irrevocable trust if you get sued.
The most common context—and is why we are bringing it up in this blog—is that irrevocable trusts can help you get government benefits to help pay for your health care as you age. People are led to believe that the only way they can get those benefits is if they don’t have any assets, or if they have them, they spend them down to nothing. The other common workaround is to put all your assets in an irrevocable trust to qualify for Medicaid.
Don’t Look for Shortcuts
When you create an irrevocable trust, you are giving up ownership. Don’t rely on a “workaround.” For example, people may put their homes in irrevocable trusts and make their children the trustees. The assumption is that the kids will do whatever the parents want. They may, but the children have control. If they don’t, you are left without any form of recourse. You can’t take it back. And you don’t get immediate protection! You have to wait 5 years, which will likely increase to 7 to 10 years. There’s a look-back period after you create one. Essentially, you are going to pay a penalty for giving up ownership.
Why do we advise only some people to create irrevocable trusts? Because you do not have to give up access, ownership, and control to receive government benefits. Certain assets are already protected when it comes to getting government benefits. For example, you don’t have to sell your home and spend your money to get a veteran benefit or Medicaid benefits if you are in a nursing home.
Speak with J. Kevin Tharpe
If you attend a webinar or a seminar and the moderator talks about irrevocable trusts in the context of government benefits, ask what the adverse effects are—to which there are several. If you have additional questions about qualifying for government benefits, trusts, or elder law, contact J. Kevin Tharpe, P.C., to schedule your consultation.
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