Shielding assets in senior years (welfare, payments, support, older)

[luvmyhoss]

POD at the bank.. 250 for owner (Me) 250 for owner me with pod for bh.
250 for owner me with pod for each child.
Then their are other ways.

[Robyn55]

Originally Posted by mlb

Spouse has Durable POA - financial and medical.

What we set up was an addendum to a trust - taking SIL off as trustee. Spouse is trustee - I am the runner up. Spouse is Executor - I am runner up.

We have a cousin who is a tax attorney well versed in tax ramifications of trusts - we will sit with him...

My MIL wears the pants in the family. She was my FIL's bookkeeper in his barber business for years and years. He's far from "controlling". And she's 93....I think she's had all the marriage she wants.

And this trust is simply dividing assets once MIL is gone - between her children - my spouse and his sister. Simple as that. The trust attorney indicated this was the best way to disallow a challenge by SIL to take over once MIL passes.

The original trust did not outline responsibilities.... said it would be shared. And honestly? That was never going to happen knowing that SIL is financially and emotionally bankrupt.

Well perhaps your cousin will help your spouse in terms of what he/she has to do in terms of handling the trust and trust assets. And all of your spouse's duties as a trustee. Note that if your spouse is a trustee - he/she has a fiduciary duty to any beneficiaries - including your SIL. You can't do arbitrary things just because you think she's "financially and emotionally bankrupt". There are pretty strict legal standards. I'm sure your cousin will explain this to you if he/she agrees to advise your spouse in terms of what a trustee is required to do. In all honesty - I wouldn't agree to advise a family member about any stuff like this unless everyone involved was "on the same page". Nothing in it for me except perhaps creating "ill will" in the family.

FWIW - most (probably all) states have laws regarding trusts that "fill in the blanks" if there are blanks in the trust documents. About half follow the Uniform Trust Code - and the other half have their own laws. But I doubt there's a single state where the trustees don't have a fiduciary relationship to the beneficiary(ies). This can sometimes result in conflicts in cases where various beneficiaries - like the lifetime income beneficiary(ies) - and the eventual assets beneficiary(ies) have different interests. That's one reason why good trust documents that try to resolve these conflicts tend to be long and complicated .

Also FWIW - I don't know why passing assets at death through a decent trust would be any less subject to challenge than passing assets at death through a decent will. That certainly wouldn't be the case in Florida and most states where I have a passing familiarity with the law. But your state could have some strange laws I'm not familiar with. About the only thing you can't do in Florida is disinherit a spouse 100% (there's a minimum spousal share regardless of what one writes in a will). And - assuming you cross the t's and dot the i's when you execute a will - that's it. It is perfectly ok to disinherit any or all of your kids 100%.

Also - if the only goal of this is to deal with assets upon your MIL's death - a will is a lot cleaner. A beneficiary of a will can't claim the decedent frittered her money away and/or cheated her out of any possible inheritance. While a beneficiary of a trust can claim that a trustee did just that.

I'm sorry if a sound a little harsh - or cross - or just ?????. But - as a lawyer who's fairly well versed in estate planning - the way you're explaining things to me just doesn't make a whole lot of sense. Perhaps it would make more sense if I looked at the documents or you mentioned what kind of trust you were dealing with. Robyn

[Robyn55]

Originally Posted by luvmyhoss

This shielding also applies to ss money. However it doesn't cover a
huge accumulation of money.

A lot (although not all) depends on the laws in your state of legal residence. Robyn

[mlb]

Originally Posted by Robyn55

I'm sorry if a sound a little harsh - or cross - or just ?????. But - as a lawyer who's fairly well versed in estate planning - the way you're explaining things to me just doesn't make a whole lot of sense. Perhaps it would make more sense if I looked at the documents or you mentioned what kind of trust you were dealing with. Robyn

We're pretty happy with the way my MIL's trust attorney has approached the issue. She's been doing this for over 30 years - in California. I expect we will retain her in the event there is a challenge after MIL is gone. I doubt there will be.

[luvmyhoss]

Putting in you will a statement that you are leaving $1.00 to x, y or z covers that person from sueing.
or stating that " x y or z gets (pick an amount) but if they sue they get nothing.

[Robyn55]

Originally Posted by mlb

We're pretty happy with the way my MIL's trust attorney has approached the issue. She's been doing this for over 30 years - in California. I expect we will retain her in the event there is a challenge after MIL is gone. I doubt there will be.

I wouldn't wait until your MIL is dead to do anything. I'd find out what my responsibilities are *now* (which is the original question you asked). At least in my state - you have a duty to give trust beneficiaries regular reports - even if the beneficiary is a residuary beneficiary who will get assets after the death of the "lifetime beneficiary". Also - unless you live in California - your trust attorney may not be qualified to do any legal work where you live (she couldn't in general handle matters like this in Florida unless she was also licensed to practice law in Florida).

Of course - you're perfectly free to do whatever you want. But I would find out what you're required to do now in terms of trust administration. So you don't throw your SIL a softball by neglecting to give her things/reports that the law requires you to give her now. You could potentially get in a lot of hot water for doing that (and wind up with some big headaches too). Robyn

[Robyn55]

Originally Posted by luvmyhoss

Putting in you will a statement that you are leaving $1.00 to x, y or z covers that person from sueing.
or stating that " x y or z gets (pick an amount) but if they sue they get nothing.

Nothing prevents a person who pays a filing fee from suing .

Also - giving a person a nominal amount (with or without the language you stated) doesn't accomplish anything if the person in question is entitled to a certain amount from an estate by operation of law. For example - in Florida - if you have a spouse you haven't seen for 2 decades - but you're still legally married - that spouse is entitled to his/her elective share upon your death. To disinherit a spouse - you have to get a divorce. Other states probably have similar laws when it comes to spouses - probably minor children too. There are also states where common law marriages are still recognized - so anyone in a situation like that should check into state laws. It's always best to check what the rules in your state are. Robyn

[luvmyhoss]

Originally Posted by Robyn55

Nothing prevents a person who pays a filing fee from suing .

Also - giving a person a nominal amount (with or without the language you stated) doesn't accomplish anything if the person in question is entitled to a certain amount from an estate by operation of law. For example - in Florida - if you have a spouse you haven't seen for 2 decades - but you're still legally married - that spouse is entitled to his/her elective share upon your death. To disinherit a spouse - you have to get a divorce. Other states probably have similar laws when it comes to spouses - probably minor children too. There are also states where common law marriages are still recognized - so anyone in a situation like that should check into state laws. It's always best to check what the rules in your state are. Robyn

I assumed spousal shares didn't need to be mentioned because they
are often decreed by your state. You know what they say about assuming

[Escort Rider]

Originally Posted by luvmyhoss

I assumed spousal shares didn't need to be mentioned because they
are often decreed by your state. You know what they say about assuming

Yep. Another example of why (for most of us non-lawyers) a will should be done by a lawyer. Sure, there is always the temptation to save $300 or $400, but sometimes one can be penny wise and pound foolish.

[markg91359]

Yep. Another example of why (for most of us non-lawyers) a will should be done by a lawyer. Sure, there is always the temptation to save $300 or $400, but sometimes one can be penny wise and pound foolish.

A few things I've learned about estate planning and many people:

1. They are convinced that lawyers are absolutely ripping them off if they want $300 to write a Will.

2. They will want a trust out of generally mythical fears about probate when a Will would serve them better and be cheaper to prepare.

3. They will call constantly on the phone and try to get advice on things like how to write a holographic (handwritten) Will. When you try to explain the technical requirements the law imposes on such documents to make them effective, you'll usually be questioned until you are blue in the face and the questioner will generally still not understand when the conversation is over. Its better to never allow yourself to have such a conversation on the phone at all.

4. They will ask things like "How can I get all the advantages of an irrevocable trust without making it irrevocable?"

5. They will try to skirt the law by doing things like writing out a deed to their children--shoving it in their bureau drawer-- and than telling the children to file and record the deed when they die in an effort to avoid probate. Unfortunately, the law (at least in all the states I know of) does not recognize this device as a substitute for probate.

6. They often expect a run-of-the-mill lawyer to be able to answer detailed questions about tax law over the phone about some trust they've set up.

7. In the end, though, most lawyers are grateful for people who try to their own estate planning without seeing a lawyer. They end up creating far more work for us than doing things right and legally in the first place would have resulted in. I previously mentioned my friend who does trusts for people (that he does not believe in) simply because he is smart enough to realize they will just go somewhere else if he won't do it.

The truth is most lawyers don't look at estate planning as an opportunity to gouge people for every last dollar we can get out of them. We simply want to recover the economic costs of doing the work (economic costs include a reasonable profit margin).