Wednesday, December 26, 2018

There's No Limit on Assets Going into a Special Needs Trust

There’s no limit on the amount of cash or assets that may be put into a trust for a child with “special needs”, but setting up and administering a special needs trust (SNT) is no simple matter due to state and federal laws, which dictate a host of rules about:
  • how SNTs are created
  • how SNTs are funded
  • how SNTs are run
  • how SNTs end
With special needs planning being one of our practice areas at Geyer Law, we take a lot of time explaining to parents and grandparents how these rules work.  The purpose of a special needs trust is to allow a disabled beneficiary to benefit from funds while not disqualifying that beneficiary from receiving governmental benefits.  Funds in a special needs trust can be used to provide the beneficiary with services and things  not covered by government benefits programs.  These might include:
  • medical expenses
  • dental expenses
  • equipment
  • special dietary needs
  • insurance
  • education
  • recreation  and vacations
  • gifts for others
  • funeral arrangements
Three specific things that a SNT should NOT do include:
  • pay cash to the beneficiary
  • pay for food
  • pay for shelter
The reasoning behind these “no-nos” is that is that special needs trusts are designed to supplement, not replace the support by government programs such as Medicaid and Supplemental Security Income (SSI).

Third party special needs trust are formed with money or property belonging to someone other than the beneficiary. Often, at Geyer Law, we help clients create special needs trusts as part of their estate plan for the purpose of providing for the needs of a disabled child after they, the parents, have died, but occasionally, the funding for the trust comes from a direct inheritance or even from a settlement from a personal injury lawsuit.  In those two instances, the trust must be set up as a self-settled special needs trust because the funds belong to the disabled beneficiary, and the trust must include a payback provision to pay the state for care provided during that individual’s lifetime.

No, there is no limit on assets going into a special needs trust.  On the other hand, there seems to be no limit on the number of federal and state laws that must be navigated to make sure the beneficiary’s government benefits remain in place. Our job as estate planning attorneys is to help our clients understand and navigate these laws so that they achieve peace of mind.

- by Rebecca W. Geyer

Wednesday, December 19, 2018

In Estate Planning Discussions, Philanthropy Should Get Personal

Philanthropy can be a differentiator,” the CEO of Exponent Philanthopy tells financial planners. “It can strengthen a client relationships over the long term and even extend to multiple generations.” Yet, in a U.S. Trust survey of 100 people with $3 million or more in investable assets, less than half reported being satisfied with the philanthropic discussions they’ve had with their advisors.

It’s not about asking clients “Are you philanthropic?” philanthropic leadership consultant Arlene Cogen says. So what are good questions to kick of a discussion about charitable giving?
  • What do you want to be remembered for?
  • How do you define success?
  • What is something meaningful that happened to you that was made possible by the money you have?
At Geyer Law, we agree that the estate planshould reflect the legacy the client wishes to leave.
Yes, there are certainly both tax benefits and estate planning benefits to be gleaned through charitable giving, but we agree with Financial Planning author Kerri Anne Renzulli, who advises financial planners that their clients would prefer talking first about the more personal aspects and motivations for giving.
With the motivating factors having been clarified, advisors can move to the “how tos”. As just one option, recognizing certain tax law changes set to take effect in 2019, our attorneys at Geyer Law have been coordinating with clients’ tax advisors along with representatives of their favorite charities, to set up donor-advised funds.

A well-crafted estate plan is by nature a very personal affair. It provides for loved ones, while at the same time protecting them from unnecessary hassles and delays. Most important, it answers the question for your survivors - What do you want to be remembered for? 

- by Rebecca W. Geyer

Wednesday, December 12, 2018

Using Horse Sense in Indiana Estate Planning

“The Indiana equine industry is an important component of the Indiana economy, a report from Purdue Extension pointed out, serving a variety of needs, including:
  • racing
  • showing (second largest use in Indiana)
  • recreation (largest use in Indiana)
  • work counts the horse population in our state at approximately 140,000. And, “while it may be a dream for you to be able to watch horses graze peacefully outside of your house’s back window, the website cautions, “a lot more goes into it than simply picking out a horse ranch for sale and buying it.”

A lot more also goes into estate planning when it comes to horse ownership. “What happens to your horse in the time between your death and probate of your will?”, attorney Karen L. Perch asks. “Will your wishes regarding care of your horse be enforceable?”.

Since 2005, Indiana residents have had the option of creating a trust for the benefit of pets. The purpose of an equine trust is to make sure that after its owner’s death, a horse continues to enjoy the quality of care to which it is accustomed. One important specialty aspect of our work at Geyer Law is dedicated to helping clients provide for equine pets.

Any equine trust will include several elements:
  • The animal is placed in a revocable (or irrevocable) living trust.
  • A sum of money to support the animal is assigned to the trust.
  • Specific instructions concerning the care of the horse are included in the trust document, including vet visits, and how the horse is to boarded, groomed, and maintained.
  • Instructions specify who is to receive money left over after the animal has died.
  • A person is named to own and take care of the pet in the event of your disability or death.
  • Instructions specify how the beneficiary will take physical possession of the pet.
“Everyone with a horse should have a horse trust in addition to the other estate planning documents,” one Massachusetts estate planning attorney colleague asserts. At Geyer Law, we agree. With our empathetic and compassionate approach, we understand that horse owners feel the need to provide for the ongoing care of pets who have brought pleasure and joy to their lives.

 - by Ronnie of the Rebecca W. Geyer blog team

Wednesday, December 5, 2018

Big Age Difference Between Spouses Demands Extra Estate Planning Initiatives

“Sizable age gaps (between spouses) can create special challenges from a financial and retirement planning standpoint,Christine Benz points out in Morningstar. Why?
  1. They may need to plan for different retirement dates.
  2. They need to plan for different life expectancies, which affects portfolio withdrawal strategies and Social Security filings..
 When it comes to planning their retirement portfolio, Benz advises, “couples with big age gaps should craft their plans to accommodate the partner with the longest life expectancy.”  A big age differential would also mean the couple will need to be significantly more conservative with their initial withdrawal amount to ensure that their assets last throughout the younger spouse’s longer time horizon, she adds.

Separating assets:
There may be situations where each partner would want to separately manage and draw from their own pools of assets, Benz explains, which is particularly common if spouses each have children from previous marriages.

Converting the younger spouse’s IRA to a Roth:
When a spouse has a longer time horizon, that increases the likelihood that the long-term tax benefits of the Roth will offset the taxes paid on conversion.

Delaying Social Security filing:
If the older partner had the higher income over his/her lifetime, but the lifetime benefits for the surviving spouse.

Long-term care planning:
Long term care insurance is particularly important for spouses with a  big age difference. Single individuals can rely on Medicaid to shoulder their long term care costs if they exhaust their financial resources, Benz notes, but “long term care expenses for an older spouse can have disastrous effects for the financial well-being of the younger partner.”

Time planning:
If the older spouse retires, while the younger one keeps working, hard feelings can develop.  It’s important for the couple to set clear expectations for their new roles and for how their time – and their money – will be spent, Kerri Anne Renzulli points out in Financial Planning magazine.

Estate planning:
As estate planning and elder law attorneys at Geyer Law, we know the special challenges faced by couples with a big age gap. Working as a team with our clients’ tax, insurance, and financial planning advisors, we help couples contend with all those moving parts. And while one primary goal of estate planning is the protection and passing on of wealth, we take a lifetime planning approach, helping couples with a big age gap deal with all the moving parts of their combined situation.

 - by Rebecca W. Geyer

Wednesday, November 28, 2018

Introducing...New Geyer Law Associate Jennifer Hammond

Their whole lives, Tom and Sara Smith had worked hard. Although hardly wealthy, the couple had lovingly accumulated assets which they had hoped to leave to their children and grandchildren. Now medical problems had become a challenge. Tom had survived cancer, but his heart condition meant he needed skilled care at home while Sara continued to run their business. How could they take advantage of Medicaid benefits, yet avoid dissipating all of their hard-earned assets? As the younger and healthier of the pair, Sara would need them for her own financial security... 

For estate planning and elder law attorney Jennifer J. Hammond, it’s all about preserving seniors’ assets while utilizing the social safety net available to families. With a Bachelor’s degree in Social Work (B.S.W.) and Certification in Case Management, she had briefly considered becoming an adoption attorney prior to earning her J.D. Interning for Rebecca last year, (Rebecca had been Jennifer’s one-time North Central H.S. classmate!), she realized her mission was advocating for families in a different stage of life; through helping adult family members get prepared - for contingencies and certainties. 

Planning for Tom and Sara (fictionalized names) involved an unusually complex area of the law, the Medicaid Waiver program. Indiana actually offers eight different HCBS (Home and Community-Based Services) programs, and Jennifer’s knowledge and legal work resulted in Tom’s being able to receive skilled care at home and avoid being forced to enter a facility… 

Jennifer also feels strongly about advocating for families through proper estate planning.  “At the very least,” Sheryl Nance-Nash writes in Forbes, “think of estate planning as a way to reduce familial stress when you’re no longer in a position to make decisions.”  Hammond certainly agrees.

Jennifer herself has been in several decision-making roles, both as a mother and a professional.  She has experience as a paralegal, legal secretary, and family law assistant at three law firms, and as a case manager for a home-based counseling agency under contract with the Marion County Office of Family and Children.  She also was the Business Manager of a local church, and spent a summer volunteering with the Senior Law Project at Indiana Legal Services.

Advocacy for families through estate planning and elder law is Jennifer L. Hammond’s career mission, and the law firm of Rebecca W. Geyer & Associates is certainly proud to welcome its newest associate.
- by Ronnie of the Rebecca W. Geyer & Associates Blog Team

Wednesday, November 21, 2018

An Estate Planning Lawyer's Overarching Role - Being a Leader

“There are many potential roles that can be filled by a financial life planner” Stephen Brody writes in the Journal of Financial Planning. “The overarching role, however, is being a leader,” Brody  asserts, quoting John Quincy Adams’ statement: “If your actions inspire others to dream more, learn more, do more, and become more, you are a leader.”

Reading through this highly insightful article, I could not help but draw a strong parallel with the relationships our estate planning attorneys have forged with clients over the years, and realize that each of the leadership theories named in Brody’s article has played out in our day-to-day professional lives.

  • Adaptive leadership (AL) involves three steps: observing events and patterns, interpreting those, and designing interventions. Each client situation is unique; many involve delicate and sensitive issues such as premarital agreements, same sex marriage matters, special needs children, advance directives, and guardianship. Family dynamics are often changing and sensitive; as advisors, we need to provide strong direction, but always with a soft touch.
  • Authentic leadership (AUL) involves being open and honest in presenting one’s true self to others, and leading with a compassion for people. Compassion demands timely responsiveness – it is our policy to respond to all clients communications on the day they are received, and we offer house calls and flexible appointment times.
  • Servant leadership (SL) involves drawing out and development the best and highest within people from the inside out. We understand the challenges, fears, and family dynamics that often come into play with legal issues, and try to assist clients in addressing their particular goals and concerns based on their “best selves”.
  • Transformational leadership (TL) encourages followers to rise above transactional considerations and pursue a higher purpose. Transformation is concerned with emotions, standards, and long-term goals. In order to offer quality advice to our clients, we must first be committed to the highest standards of knowledge in both estate planning law and all the overlapping areas of expertise.

At Rebecca W. Geyer & Associates, we know we play many roles, with the overarching role of serving as leaders.

- by Rebecca Geyer

Wednesday, November 14, 2018

When Paying Taxes Isn't a One-Time-a-Year Task

“For many retirees, paying taxes isn’t a one-time-a-year task”, a recent issue of Kiplinger’s Retirement Report points out. Even after taking care of their 2018 tax return, many seniors will need to work on their Form 1040-ES to pay estimated 2019 taxes, with the first quarterly payment due in April.

One thing that is true all year round, but which becomes most obvious as year-end approaches, is this: tax law and estate planning overlap. Just as tax attorneys and CPAs must regularly take into account their clients’ estate planning goals, we as estate planning and elder law attorneys must think about the tax ramifications of the planning we do with our clients.

At Geyer Law, part of our responsibility includes staying familiar with the laws that relate to the tax aspects of:
  • wills and trusts
  • social security benefits
  • medical and long term care benefits
  • Medicare
  • life insurance
  • pensions and other retirement plans
  • real estate property
  • charitable gifts
  • college planning for children and grandchildren
  • veterans’ benefits
 What’s more, since quite a number of our Geyer Law clients are business owners, we must work in cooperation with their insurance, tax, and financial planning advisors on their:
  • choice of business entity
  • internal corporate documents
  • liability issues
  • succession planning,
all of which relate to their estate planning. Proper succession planning is crucial for business situations, because of the three what ifs: the death, disability, or retirement of a current owner.  

For those old enough to remember the song lyrics, there’s a real parallel here:  “Love and marriage, love and marriage, go together like a horse and carriage.” The “marriage” of tax planning and estate planning is not just a one-time-a-year task!
- by Rebecca W. Geyer

Wednesday, November 7, 2018

Year-End Planning - Where Estate and Tax Planning Meet for Seniors

For all of us, falling leaves are a reminder that, as year-end approaches, we need to make sure all our tax-related i’s are dotted and our t’s crossed. Year end is also a time when tax planning and estate planning are most inter-related for seniors.

As the AARP book The Other Talk points out, “The kids will need to know the location of your most recent seven years of tax returns.” Why?

  1. for IRS queries while you’re still here
  2. for determining the extent of assets in your estate and filing a final income tax and estate return and/or a revocable trust return.

Author Tim Prosch urges elders not to procrastinate when it comes to making notebooks for each adult child. “The more information your kids have, and the sooner they get it, the better for you and for them.” Documents that could go into the notebooks, in addition to those seven years’ tax returns, might include:

  • will
  • trust
  • advance directives (durable healthcare power of attorney and living will)
  • summary list of all doctors – along with contact information- and medical advisors
  • contact information of all key advisors
  • insurance information for life, health, home, vehicle, and boat insurance
  • banking information
  • inventory of current investments
  • credit card information
  • burial and funeral arrangement information

End-of-year planning also means IRA planning. After reaching age 70 ½, owners of IRA and other tax-deferred retirement accounts must take an annual RMD (Required Minimum Distribution).  The account values as of December 31 of 2017 are used to calculate this year’s RMD, Bob Carlson reminds us in Forbes. Carlson cautions the RMD rules are not simple ones, and are, in fact, “the source of many mistakes and oversights by account beneficiaries, resulting in lost opportunities, extra taxes, and penalties.”

It happens often – we’ll be talking to clients here at Rebecca W. Geyer & Associates about their estate planning and mention the RMD requirement.  While they will have heard about the RMD, many will have forgotten the way the rules work. While at Geyer Law we do not offer tax preparation,(instead working together with clients’ tax advisors to craft a unified plan), IRAs represent one area where there is a large overlap between tax planning and estate planning.

Year-end is that time of year when we’re reminded that the distribution of assets out of IRA
accounts,  whether to the owners while they are still alive or to their beneficiaries after they’ve passed on – even when there is a notebook prepared -  is no simple matter.

- by Rebecca W. Geyer

Wednesday, October 31, 2018

Could Heirs Use a Conservatorship to Take Away Parents' Property?

“Seniors need to be aware that their children, siblings, and other heirs can sometimes try to use such a health condition as a way to gain legal control over their property,” cautions. “Seniors should be aware that they are vulnerable to involuntary conservatorships, guardianships, and related types of actions”. .

In “Guardianship in the U.S.: Protection or Exploitation?” author Emily Gurnon tells the sad-but-all-too-true story of Ginger Franklin, who, in 2008, had fallen down the stairs of her  Nashville-area townhouse, had been taken to the hospital with a severe brain injury. Since Franklin had not designated anyone to make decisions for her if she became incapacitated, her nearest relative, an aunt, was advised to petition the court for a guardian. The county appointed a lawyer as the guardian, and that person placed Franklin in a group home for seriously mentally ill adults.

When Franklin recovered and returned home seven weeks after the accident, the guardian informed her that she no longer had a home.  The court had granted permission for the guardian to sell her home and its contents. The owners of the group home forced her to work for no pay, while paying monthly rent and attorney fees to the guardian.
Finally, with the help of an advocate and media attention, Franklin fought the guardianship in court, winning her freedom in 2010 after two long years of having no legal rights. She now lives independently in the Nashville area and has sued the guardian.
In most circumstances, pennyborn continues, it is possible to avoid a conservatorship by granting a durable financial power of attorney to someone you trust while you still have capacity. You can also place assets into a living trust, appointing a successor trustee to manage the trust assets in the event of your incapacity.

At Geyer Law, the goal of each of our elder law attorneys is to accomplish your objectives and provide for your family in the best way possible, including keeping control of your assets in your own hands as long as you are able to make decisions.

Nobody wants to think that their heirs will not respect their wishes, but you need to take steps to protect your own interests and keep you in charge of your own finances. Proper estate planning is designed to do just that. At the same time, good planning is designed to spare your loved ones expense, delay, and frustration if you become disabled.

- by Rebecca W. Geyer

Wednesday, October 24, 2018

October is National Bullying Prevention Month: What Seniors and Caregivers Need to Know


October is a time for raking leaves and Halloween costumes.  It’s also National Bullying Prevention Month.

Bullying is defined by as “unwanted, aggressive behavior among school-aged children that involves a real or perceived power imbalance.” Types of bullying include:
  • Verbal (teasing, name-calling, taunting, threats)
  • Social (spreading rumors, shaming, leaving someone out of a game or activity)
  • Physical (hitting, kicking, pinching, tripping, pushing, taking or breaking things)
As elder care attorneys, at Geyer Law we’re concerned about bullying victims who have long ago left the school playground and who are now “aging in place” at home or in senior living facililties. As we specialize in helping elders and their families with special needs planning, guardianships, and veterans aid benefits, we are all too often made aware of three different forms of senior “bullying”:

1. Elder abuse by caretakers and family members
The Administration on Aging defines elder abuse as “any knowing, intentional, or negligent act by a caregiver or any other person that causes harm or a serious risk of harm to a vulnerable adult”.

2.  Bullying by peers in senior living facilities
People may develop destructive bullying behaviors as an adjustment mechanism during times of transition, Cyndy Marsh writes in the Caregiver Training Blog, and bullying among seniors can take some of the same forms as childhood bullying:
  • gossiping or whispering when someone enters a room
  • insults
  • belittling jokes
  • spreading rumors
  • bossy behavior
  • enforcing artificial seating arrangements
  • making fun of physical or mental disabilities
  • offensive gestures of facial expressions
  • invading one’s personal space
  • racial slurs
  • physical abuse
If the behavior continues, it is important for adult children to reach out to the administrator or nursing staff, requesting that an assessment be conducted to determine if the bully has a medical condition (dementia and certain prescription medications) that are triggering the bullying behavior.  Insist that a protocol be put in place to address the situation.

On the other hand, as Lifecare Innovations points out, when residents complain to family members about the bullying behaviors of other residents, family members will sometimes attempt to correct the behavior themselves by approaching the offending resident. These scenarios can escalate and cause a bad situation to grow far worse.

Existing studies suggest about one in five seniors encounters bullying, Social work professor Robin Bonifas at Arizona State University sees bullying as an outgrowth of:

a. frustrations characteristic in communal settings
b. issues unique to getting older

3.  Adult children overstepping their boundaries.
In dealing with aging parents, It’s imperative that adult children not attempt to force their will on their parents, and that they ”pick their battles” by focusing on only the important things.  In “Are You Bullying Your Aging Parents?”, Linda Bernstein names five key issues adult children and parents fight about include:
  1. driving
  2. finances
  3. home safety
  4. doctors, treatments, and medication
  5. end-of-life planning

Aging individuals, their children, and their caregivers can all be overwhelmed by the physical toll of aging and the burden of finding resources to address long-term care needs. At our elder law firm, we try to go beyond the traditional legal issues and by advice, referral, and direct assistance do our best to help clients address the problems brought on by aging.

Let’s all do our best to observe bullying prevention month – all year round!

- by Ronnie of the Rebecca W. Geyer blog team

Wednesday, October 17, 2018

Hip Pocket Resources for Indiana Seniors and Their Children

Kiplinger’s Retirement Report calls it “Information to Act On”; at Geyer Law, we think of them as “hip pocket” resources for seniors,. These are things you may need to know, either right now, or perhaps when life throws you or a family member a “curve ball”.
Just three of the resources named in the Kiplinger report include:
  1. Electronic Deposit Insurance Calculator tool at . This tool indicates whether all of your money in different banks is covered by the Federal Deposit Insurance Corporation.
  2. Social Security Administration’s list of 228 medical conditions for which disability claims will be expedited. This may be found at
  3. The Family Caregiver Alliance’s “Family Care Navigator”, which helps families locate government, nonprofit, and private caregiver support programs, may be found at
Here are four other “hip pocket” resources named by the National Council for Aging Care:
  1. PACE® - Programs of All-Inclusive Care for the Elderly coordinate all the types of care a senior living at home might need, including medical care, personal care, rehabilitation, social interaction, medications, and transportation.  Phone number is 1 800 MEDICARE; website is
  2. Eldercare Locator – This is a free national service of the US Administration on Aging.  It helps find local resources such as legal, financial, caregiving, home repair, and transportation.  Phone number is 1-800-677-1116; website is
  3. Healthfinder is a service under the U.S. depart. Of Health and Human Services.  The website provides links to health-related websites, support and self-help groups, government agencies, and nonprofit organizations that assist seniors.
  4. The National Directory of Home Modification and Repair Resources helps find qualified local services and professionals to modify and renovate seniors’ homes.  The website is
The attorneys at Rebecca W. Geyer & Associates have themselves, over the years, served as invaluable resources for seniors and their children in many areas of need, including:
  • wills and trusts
  • advance directives
  • estate administration
  • Medicaid
  • veterans benefits
  • special needs planning
  • business services
  • guardianships
  • dispute resolution

Essentially, at Geyer Law, we’re all about things you need to know, either right now, or perhaps when life throws you or your family a “curve ball”!

- by Ronnie of the Rebecca W. Geyer & Associates blog team

Wednesday, October 10, 2018

Estate Planning Attorneys Reassured by Planner's Retirement Prognosis

Clients can stop freaking out about having enough money in retirement, Craig Israelsen assures readers of Financial Planning.
At Rebecca W. Geyer & Associates, we were happy to learn of Israelsen’s positive investment prognosis.  While we’re estate planning and elder law attorneys, not financial planners, we’re obviously concerned with our clients’ retirement security.
Since 1926, the author explains, there have been 33 distinct “client lifetimes”. By following a simple investment strategy, he says, all 33 would have been left with millions of dollars if they lived to age 95. For purposes of the analysis, several assumptions were used: 
  1. The client begins to invest for retirement at age 35, retires at age 70, and lives to age 95, meaning there is a 35-year accumulation period followed by 25 years of distributions.
  2. The client withdraws only the Required Minimum Distribution each year and nothing more, and each year’s RMD is adequate for their needs.
  3. In the accumulation period, the client saves 8% of annual income, investing it in 60% stocks, 40% fixed income.
  4. The average 35-year rolling return for this annually-rebalanced portfolio was 9.97%.
  5. The first of the 33 clients turned 35 in 1926, the last in 1958.
In the Israelsen study, the largest balance in the retirement portfolio at age 70 was $1.76 million, the smallest $860,000. Over the next 25 years, an average $236,843 was withdrawn, based on RMD guidelines.

The moral of the Israelsen study, he says, is this: A retirement portfolio that is built for growth during both the accumulation years and the distribution years can distribute far more to the retiree than its starting balance at the beginning of retirement. Your clients, Israelsen assures financial planners, will likely have enough if they budget reasonably.  All that anguishing in advance, he says, robs those clients of the joy that can accompany the new opportunities in the final chapter of their lives.

At Geyer Law, we understand the challenges, fears, and family dynamics that come into play with clients’ legal issues, and we are delighted to hear that at least some of the fear of portfolio shortcomings in retirement may be unnecessary!

- by Rebecca W. Geyer

Wednesday, October 3, 2018

Changes in Veterans' Benefits Looming October 18th

On September 18, 2018, the Department of Veterans Affairs officially published the amendments to certain regulations having to do with VA benefit claims. The VA hasn’t left beneficiaries a whole lot of time to adjust – those changes become effective on the 18th of this month!

Veteran’s Benefits are perhaps the most misunderstood and underutilized resources available to millions of veterans and their families. At Rebecca W. Geyer & Associates, our focus is with the Veteran’s Benefits Administration. We assist wartime veterans, or surviving spouses of wartime veterans, in obtaining VA Pension Benefits. With the looming October 18th deadline, at which time important changes go into effect, our work with veterans becomes an even more urgent initiative. The new rule changges relate to standards that must be met to qualify for non-service connected pension payments.  Here’s a general summary of what’s happening:

The VA looks at three elements:

Net worth includes the claimant’s or beneficiary’s assets and annual income. A Veteran’s assets include his/her own assets plus the assets of the spouse. In 2018, the top limit on net worth is $123,600.  Under the current system, that number increases by the same percentage as the cost-of-living increase for Social Security benefits. Net worth may be decreased in three ways: a) the assets themselves decrease b) annual income decreases c) assets and income decrease.

Under the existing rules, assets include the value of real property, not counting the primary residence or the mortgage on it.  Under the new rule, a residential lot may not exceed two acres; anything above two acres will be counted as an asset.

If the VA finds that a claimant transferred (either by selling it for less than market value or actually giving) assets to someone else in order to reduce the assets and qualify for benefits, the amount will be subject to a penalty. This includes converting assets into an annuity.

The “lookback period” will be the 36 months immediately preceding the date of the pension claim.  This does not include transfers prior to October 18, 2018, which is why the deadline is so important!
Under the current rules, there are no definitions of deductible medical expenses for the purpose of VA pensions. The final rules expand the definition of “Activities of Daily Living” to include:

1. ambulating within the home or living area
2. instrumental activities of daily Living (shopping, food preparation, housekeeping, laundering, managing finances, handling medication, using the telephone, and transportation for non-medical purposes).

In-home care must be from a licensed health care provider (unless a physician has stated in writing that care can be provided by an in-home attendant.

Time is of the essence in notifying clients of these changes, cautions ElderCounsel, because all VA planning that includes transfers must be made before October 18 2018.  At Geyer Law, we’re making time to meet with every veteran and beneficiary to beat that deadline!
- by Rebecca W. Geyer

Wednesday, September 26, 2018

Long Term Care Insurance Choices - Riders and Hybrids

“Planning ahead for long-term care is important because there is a good chance you will need some long-term care services if you live beyond the age of 65,” cautions As Indiana elder attorneys, we certainly agree that long-term care planning has an important place in both retirement and estate planning, helping clients take charge of their finances and protecting both themselves and their heirs.

In particular, at Rebecca W. Geyer & Associates, our attorneys have been paying attention to the reduced number of viable long-term care insurance choices being offered to our Indiana estate planning clients. Why?  “For aging baby boomers, planning for long-term-care costs becomes more pressing every day. But the insurance that helps cover those costs is surging in price, while the benefits are becoming skimpier.”

There are two phenomena to which we’ve been paying special attention:

1.  Living benefit riders on life insurance policies
Living benefit riders take money out of the death benefit to pay for insureds’ medical care needs while they are still alive. The payment of the death benefit is “accelerated” and paid out while the insured is still alive, typically under any of the following three circumstances:
  1. The insured has been diagnosed with a terminal illness with a 6-24 month life expectancy.
  2. The insured has a chronic illness that leaves him or him unable to perform activities of daily living (bathing, continence, dressing, eating, toileting, transferring).
  3. The insured has a critical illness (heart attack, stroke, cancer, renal failure, organ transplant, ALS, blindness, paralysis)
At first, explains, living benefit riders were offered only on cash value policies such as whole life or universal life, but they are now available in term life insurance products as well.

2.  Hybrid insurance
The hybrid insurance policy allows death benefits on life insurance to be used towards long-term care costs. These policies overcome the difficulty many clients have in paying for long-term care insurance, which they may be lucky enough to never need to use, but whose premiums are non-recoverable. With a hybrid policy, Damon Gonzales of points out:
  1. After a surrender charge period (usually 10 yrs.), you can cancel and get a refund
  2. There is a death benefit paid to heirs when you die
  3. There is a guaranteed cash value, a guaranteed death benefit, and a guaranteed amount of long- term care coverage
Along with these advantages, Nerdwallet points out three big drawbacks hybrids have:
  1. Premiums, paid over shorter periods of time than traditional long-term care premiums, can be much less affordable
  2. There is hardly any growth offered on the cash value
  3. Premiums are not tax deductible (Hybrids are not considered tax-qualified policies) 

At Rebecca W. Geyer & Associates, we offer no insurance projects or direct tax advice, working with other advisors to address insurance product choices. Long-term care insurance is just one more example of the overlap among professionals in the area of law, insurance, and tax.       
Realizing, however, just how crucially important this subject is for the long-term well-being of our clients and their family members, we at Geyer Law want to provide the most up-to-date information on the subject of long-term care.

- by Rebecca W. Geyer

Wednesday, September 19, 2018

In Buying Long Term Care Insurance, It Pays to Go for the Sweet Spot

“For aging baby boomers, planning for long-term-care costs becomes more pressing every day. But the insurance that helps cover those costs is surging in price, while the benefits are becoming skimpier,” Eleanor Laise comments in Kiplinger’s Retirement Report.

It’s true. According to the American Association for Long-Term Care Insurance, the overall cost of new long-term care coverage has been jumping roughly 9% a year.

At Rebecca W. Geyer & Associates, our attorneys have been paying attention to the reduced number of viable long-term care insurance choices being offered to our Indiana estate planning clients. For one thing, as Kiplinger mentions, benefits such as lifetime coverage and a 5% compound inflation benefit protection have either become unaffordable features or aren’t being offered by some insurers.

There are most definitely “sweet spots” for purchasing long-term care insurance, we concluded.  Those “sweet spots” relate to wealth, health, and age:

Age related sweet spot:

Ideally, clients purchase long-term care insurance when they are in their 50s. Not only do premiums begin to rise quickly from there, but one-quarter of applicants age 60-69 are rejected, Laise points out.

Asset-related sweet spot:
Wealthy people (Kiplinger refers to those with financial assets of $2.5 million +) may decide to forgo insurance. If they end up not incurring long term care costs, their heirs will receive more; if they do need to pay for long-term care, they can afford to do so. People with limited assets and those who cannot reasonably sustain the premium costs over decades would be better off not buying expensive policies, perhaps choosing lower benefits or limited benefit period coverage.

Health-related sweet spot:
Insurers have been tightening their underwriting standards, Laise emphasizes, so buying while you’re in good health has become even more important. Some companies have added blood tests and scrutinize family history for heart disease and dementia.

At Geyer Law, there are two phenomena we’re paying attention to - permanent life insurance with a critical care rider and hybrid insurance. In next week’s blog post, we’ll discuss the plusses and minuses of each of these approaches to long-term care insurance.  Stay tuned….
- by Rebecca W. Geyer

Wednesday, September 12, 2018

Avoid Aretha's Estate Planning Mistake

Avoid the estate planning mistakes of Aretha Franklin and Prince, advises Richard Eisenberg, writing in Both these one-time blockbuster music stars died without a will or trust, Eisenberg notes, and, he warns, “Following in their footsteps could mean your loved ones won’t receive the inheritances you intended.” Problems you might cause your heirs include:
  • Disbursements could be long-delayed
  • Ugly family squabbles might ensue
  • Your estate might owe additional taxes
  • Your financial life will become a public record
  • If you have a special needs child, he or she may wind up losing government benefits
Considering the fact that Aretha Franklin knew she had pancreatic cancer, you would think she’d have considered creating a will.  At least one of her attorneys tried to get her to do exactly that, but the singer never followed through, Eisenberg relates.

What’s so all-important about having a will?
Having a will means that you, rather than your state’s laws, decide who gets your property when you die, explains. Wills can:
  • distribute your property
  • name an executor
  • name guardians for children
  • forgive debts
Without a will or other estate plan, state laws known as "intestate succession laws" decide which family members will inherit your estate and in what proportion. Most people want to distribute their property differently than the state would distribute it, continues. For example, many people want to leave gifts to friends, neighbors, girlfriends, boyfriends, schools, or charitable organizations – and intestate succession does not allow for any of that.

At Rebecca W. Geyer & Associates, our attorneys are focused on understanding your particular goals and concerns, taking a lifetime planning approach. That means planning for each client’s’ current needs as well as for a potential disability and death.

Control is really the name of the game and the real reason for having a will. Few people have an estate worth $80 million (the estimated value of Franklin’s estate), but deciding how one’s assets are distributed is still most people’s preference. Keep in mind that settling an estate involves a lot of emotions. The slightest differences can result in hurt feelings and recriminations. A will that clearly lays out your wishes may reduce conflict and speculation over what you “would have” wanted.
- By Rebecca W. Geyer

Wednesday, September 5, 2018

The Executor Shouldn't Need to Start from Scratch

When there’s a death in the family, the responsibility of settling the estate is often designated to the oldest child or to a sibling. One problem that too often arises, explains certified home inventory professional Cindy Hartman, is that, in addition to making funeral arrangements, placing the house on the market, and finalizing the financials, the executor needs to create an inventory.

The inventory consists of a list that must be submitted to the court within sixty days of the estate’s opening.  The list needs to include all financial assets as well as the contents of the home (and of any storage facilities) containing the deceased’s belongings. And not only does that inventory list need to be compiled, the executor must determine the fair market value of each item. In other words, besides gathering the estate property, paying debts and distributing assets to the decedent's heirs, the executor must also complete a court-approved inventory form.

That means that, at one of the most emotion-filled times in his or her life, the question on an executor’s mind is typically “Where do I start?” Hiring a certified home inventory professional can relieve the executor of this work, Hartman explains.

As estate planning attorneys, we at Geyer Law counsel:
  • executors
  • personal representatives
  • trustees and
  • beneficiaries,
with the goal of reducing stress and ensuring prompt resolution of the settlement and administration of estates.  We’ve found that regular communication with all parties involved goes a long way to reduce conflict and delays.

Still, it’s always better when you start things out as part of your estate planning process, rather than leaving the job to your heirs.  To start, Investopedia suggests, go through the inside and outside of your home and make a list of all items worth $100 or more. “Examples include the home itself, television sets, jewelry, collectibles, vehicles, guns, computers/laptops, lawnmower, power tools and so on,” the authors of “16 Things to Do Before You Die” advise.

Cindy Hartman has it right: Often individuals do not know where to begin when someone in their family dies. Planning before death can relieve a large portion of the burden work that falls upon the executor, although there are still tasks that will remain to be accomplished. We provide full-service estate administration services to guide families through the process from start to finish.

 - by Ronnie of the Rebecca W. Geyer blog team

Wednesday, August 29, 2018

Grantor or Non-Grantor Trusts - What's the Dif?

Some of the advice financial advisors give clients concerning setting up trusts may be outdated or overly simplistic, Martin Shenkman, a New Jersey CPA and attorney fears. In an article in Financial Planning, Shenkman offers a guide explaining the distinction between grantor and non-grantor trusts.

1. Grantor trust - the client sets up the trust and pays the tax on the income. Some plans, such as those involving life insurance, might be best held in this type trust. All revocable living trust are considered grantor trusts while the grantor is alive.

2.  Non-grantor trust – the trust, not the client, pays income tax on the income. This type of trust might be recommended for those who want to maximize charitable contributions deductions.

“Advisors need to understand the nature of the trust’s structure,” Shenkman explains, “as it affects not only income tax planning but also asset location decisions.” While advisors don’t need to be experts, he says, they need to have some understanding of the different nuances. When the client’s attorney recommends a type of trust, the planner must truly understand the nature of that trust, the author comments.

There are more variations of trusts than ever before, which means clients and their families can benefit from more strategies, Shenkman says, and planners should remain proactively involved in the planning.

“Recognize the value in a strong partnership between financial planner and estate planning attorney,” urges Mike Piershale in “It’s vital that clients have not only a strong estate plan, but have their finances secured as well.”

At Rebecca W. Geyer & Associates we fully agree. As a full-service estate planning and elder law firm serving the people of central Indiana, we work as a team with our clients’ tax, insurance, and financial planning advisors to best meet our clients’ estate planning and business goals.

Whether building a room addition or an estate plan, one important part of any strategy involves choosing the right tool. The choice of a grantor or non-grantor trust – and the choice to work as a team with our clients’ other advisors - can make a very big difference in terms of achieving the desired estate and tax planning outcomes!
- by Ronnie of the Rebecca W. Geyer blog team

Wednesday, August 22, 2018

Priority Added to the Indiana Health Care Act

Indiana has joined other states in specifying an order of priority for health care decision-making. House Bill 1119 establishes which parties can make health care decisions for an adult who:
  • is incapable of consenting to medical treatment (too physically or mentally impaired, or unconscious)
  • has not appointed a health care representative
How does the process work under the new law?
1.  The health care provider must make reasonable inquiry (by examining medical records and personal effects), attempting to locate and contact persons who can act on behalf of the patient.

 2. The law establishes a specific order of priority, (from most preferred to least preferred) of individuals who can make health care decisions for the patient in the absence of legal documentation appointing a representative:
  • judicially appointed guardian or representative
  • spouse (but not one who is legally separated from the patient or where a petition is pending for separation or annulment)
  • adult child
  • parent
  • adult sibling
  • grandparent
  • adult grandchild
  • nearest other adult relative
  • adult friend (one who has maintained regular contact and is familiar with the individual’s activities, health, and religious or moral beliefs
  • religious superior
House Enrolled Act 1119, remember, is designed to establish priority when the patient has not appointed a health care representative. At Geyer Law, a health care proxy document, which allows you to give another individual legal authority to make health care decisions for you, is an important part of the estate planning process. A second document, the living will, allows you to determine if you want your life artificially prolonged by tubes and machines if you’re suffering from an incurable illness or injury.

House Bill 1119 contains a second section referring to a document about end-of-life decisions called a POST or POLST (Physician Order for Life Sustaining Treatment).  While your living will is part of your legal documents, a POST is a medical order signed by a doctor, Advance Nurse Practitioner, or Physician Assistant, referring to immediate treatments. POSTS are usually recommended for terminally ill or very frail seniors, explains.

Although it’s a positive development that Indiana law now prioritizes who may make medical decisions on your behalf, advance directives ensure that your wishes are respected.

 - by
Rebecca W. Geyer

Wednesday, August 15, 2018

Beginning Next Year, Roth Conversions Can't Be Undone

With the halfway mark of 2018 behind us, it might be appropriate to direct some thought towards calendar-sensitive estate planning and tax planning topics. (Last week in our blog we covered donating Required Minimum Distributions from IRA accounts to charity, noting that the law has allowed more flexibility in the timing of Qualified Charitable Distributions.

Unfortunately, when it comes to Roth IRA conversions, flexibility appears to be going away. As Bill Bischoff puts it in, the new tax law “creates a perfect storm for Roth IRA conversions.”

By way of quick review, Roth IRAs have two big tax advantages as compared with “traditional IRAs:
  1. Withdrawals are federal income tax-free (assuming you’ve kept a Roth account open for at least five years, and you’ve reached age 59 ½ - or have become disabled).
  2. There are no annual required minimum distributions, even after age 70 ½.
Because of these two advantages, many individuals moved significant sums of money into Roth IRAs by “converting” their traditional IRA accounts to Roth status.  Yes, the conversion is treated as a taxable withdrawal, usually triggering a big federal and state tax bill, but…many believe today’s tax rates are the lowest we might see for the rest of our lives.

Since withdrawals from a Roth will be federal-income-tax free (so long as at least one Roth account has been open five years or longer), the motivation for doing the conversion now is to pay tax at today’s low rates (and enjoy spending it tax-free later – or leaving it as a legacy with less tax liability for the heirs).

Up until this year, a Roth conversion represented a reversible decision. Under prior law, if it turned out that the decision to convert traditional IRA monies into a Roth had a greater than anticipated negative tax impact, you could undo the deal up until October 15th of the following year. In fact, if you converted a traditional IRA into a Roth in 2017, you have the chance to reverse that conversion between now and October 15, 2018.

However, for 2018 and beyond, no longer will reversals of Roth conversions be allowed.

Handling IRA planning is yet another example of the way tax planning and estate planning tend to overlap. While Rebecca W. Geyer & Associates does not offer direct tax advice, we do coordinate efforts with other advisors to address the tax aspects of the planning process. This is an important change, and we want to be sure to keep our clients and blog readers apprised of all the latest updates in tax law.

 - by Rebecca W. Geyer

Thursday, August 9, 2018

Any Time is Now the Right Time for Donating IRA $ to Charity

After you attain the age of 70 1/2, you're required to take a minimum distribution from your retirement plans on an annual basis, regardless of whether or not you need the money. If you don't need your required minimum distribution (RMD) and have a charitable intent, it is possible to donate the RMD directly to charity and avoid paying income tax.

Details to note:
  1. Does the law include transfers from 401K’s or other pension accounts besides IRAs? The answer is no. A Qualified Charitable Distribution must come – and must come directly - from an IRA account.
  2. Is there a limit on the contribution? If you’re 70 ½ or older, you are allowed to transfer up to $100,000 to charity tax-free each year, even if that is much more than your RMD.  Your RMD for the year will have been satisfied, and the rest will not be included in your adjusted gross income.
  1. You cannot “double dip” by also deducting the money you’ve transferred to the charity as a charitable deduction.
  2. You cannot withdraw the money from the IRA and then write a check to the charity; the money needs to be transferred directly from the IRA to the charity.
Bonus benefits:
  1. Because making a tax-free transfer (rather than taking your RMD) keeps the money out of your adjusted gross income, you help avoid the Medicare high-income surcharge.
  2. Keeping money out of adjusted gross income can mean less of your Social Security benefits might be taxable.
The Qualified Charitable Distribution is just one example of the overlap between tax and estate planning.  And while the attorneys at Rebecca W. Geyer & Associates do not offer tax advice, we do coordinate efforts with other advisors to address the tax aspects of the planning process, and we make sure we keep our clients apprised of all the latest updates in tax law.

When it comes to IRAs, we don’t want you to miss out on any of the details, cautions, or benefits!

 - by Rebecca W. Geyer

Wednesday, August 1, 2018

Does an Indiana Estate Plan Survive a Suicide?

Suicide is a disturbing topic, New York attorney Mark Michael Campanella admits, yet suicide is a reality that many families unfortunately face. While there’s no question suicide can devastate a family, Campanella assures clients and their heirs that if a person’s wishes have been outlined in a properly executed and valid estate plan, those wishes will still be followed regardless of the manner of death. The one caveat, Campanella adds, has to do with life insurance contracts, which are often issued with suicide exclusion clauses.

It’s actually not true that,if you commit suicide, your life insurance will always refuse to pay out, explains. Some insurance policies will pay benefits even if the policyholder committed suicide so long as the policy has been held for a certain minimum period (usually two to three years, depending on the carrier).

Here at Geyer Law, we could not help noticing that just within the past few weeks, headlines announced the suicides of two celebrities - designer Kate Spade and TV personality Anthony Bourdain. “The reality is that suicide does not discriminate based on age, sex, status or financial well-being,” east coast attorney Gary Altman writes, pointing to the following frightening statistic: Suicide is the tenth leading cause of death in the United States. 

If suicide does affect your family, the attorneys at Rebecca Geyer & Associates can help you navigate the difficult issues which arise when someone dies.

A properly executed estate plan describes in detail what happens to a person’s assets at death. The plan goes into effect as soon as a person dies, and will be followed so long as it is valid. The manner of a person’s death is ultimately irrelevant so long as the plan was executed properly, and we can ensure that the individual’s assets properly pass to his or her intended recipients.

- by Ronnie of the Rebecca W. Geyer blog team

Wednesday, July 25, 2018

Estate Planning with Both Income and a Charity in Mind

“They aren’t for everyone, but this sort of donation could generate income, Eileen Ambrose writes in Kiplinger’s Personal Finance, referring to charitable gift annuities.  Typically a contract between you and your alma mater (or other institution), the charitable gift annuity is a special arrangement whereby you make a donation of cash, securities, or other assets to the organization. The institution invests the money and gives you fixed payments for the rest of your life.

“Consider yourself a prime candidate for investing with your college,” William Baldwin explains in Forbes, if:
  • you’re in a high tax bracket
  • you’d like to consume a certain chunk of your own principal (rather than leaving those assets to heirs)
  • your health is good
  • you own appreciated assets in a taxable account and you’d like to sell (but the capital gains tax would be burdensome)
  • you really like the institution’s mission and want to support it
Particular advantages of charitable gift annuities:
  1. You can diversify without paying an immediate capital gain (in fact, you can claim a tax deduction all in the first year, “skipping over” the tax that would be due on the appreciation in the assets).
  2. The annuity payments are highly secure, backed by an endowment many times larger than its liabilities.
  3. You get a tax deduction upfront.
  4. You receive a fixed, reliable amount of income for life (regardless of the rate of return the charity actually earns on the money).
  5. The income can begin immediately or be deferred until a later time (the older you are, the higher the payout rate.
“And, if you die young after buying a collegiate annuity, it’s not an insurance company that gets a windfall.  It’s an institution you admire,” Baldwin observes.At Geyer Law, we’ve found the charitable aspect of gift annuities is an attribute our estate planning clients find reassuring.

While the attorneys at Rebecca W. Geyer & Associates do not offer tax advice, we do coordinate efforts with other advisors to address the areas of tax and estate planning that overlap.  For estate planning that keeps both income and charitable wishes in mind, a gift annuity might be just the thing.

- by Rebecca W. Geyer

Wednesday, July 18, 2018

Inherited an IRA - What Are Your Options?

If you inherit an IRA from a parent or sibling, writes Eric Vogt in Forbes, you probably have many questions:
  • What options do I have for taking distributions?
  • What are the tax implications?
  • How do I incorporate this inheritance into my existing financial plan?
Two things you can't do:
  1. roll the inherited IRA into your own existing IRA
  2. continue to defer tax until your own age 59 1/2
Things you can - or must do:
  • Roll over the inherited assets into an inherited IRA in your name.  The account would be titled as follows: "Your Parent's Name, Deceased for the benefit of Your Name, Beneficiary".
  • Begin taking required minimum distributions by Dec. 31 of the year following the original owner's death (however, if the person who died was 70 1/2 or older, any Required Minimum Distributions due prior to or during the year of the rollover must be taken out right away).  If you leave the money in the account, but fail to take the necessary distributions, there is a 50% tax penalty.
  • Distributions in excess of your share of your Required Minimum Distributions must first go into an inherited IRA.  All distributions you take will be included in your gross income for tax purposes.
There are three ways to take cash distributions:
  • All at once (lump sum) - you will pay income tax on the entire amount.
  • Over five years - there will be no penalty, but you will pay tax each year on the amount withdrawn.
  • Over the course of your own life expectancy (using the Required Minimum Distribution table based on your age and on a percentage set each year by the IRS. 
"An IRA's greatest gift is long-term tax shelter," writes Jane Bryant Quinn in AARP. "The tax-sheltered growth of these investments could continue for years, even for decades," she explains, coming down on the side of heirs deferring tax on inherited IRAs as long as possible.

Correct titling of the account is critical. At Geyer Law, we often meet with the beneficiaries of our estate planning clients, helping each beneficiary select the best course of action given his or her own financial situation.

If you inherit an IRA from a parent or sibling, it's important to know the things you can't do, the things you can do, and the things you must do to make the most out of your legacy.

 - by Rebecca W. Geyer

Wednesday, July 11, 2018

Estate Planning Around Social Security

“Social Security is known as the ‘third rail’ of politics: American voters are so protective of the federal retirement program that they’ll electrocute any politician who messes with it,” quips Richard Stolz in Employee Benefit Advisor.  The problem for advisors, Stolz emphasizes, is the “yawning gap” between clients’ expectations of the benefits they will receive when they retire and the benefits they actually will receive. “We’re usually saying that, if you’re 50 or older, you’re probably going to get what you think you’re going to get,” a CFS Investment Advisory Services partner says. If you’re younger, you’ve got to monitor it, he adds. Some advisors are running retirement scenarios for their clients with and without Social Security.

“Isn’t this a great system we have? In order to get your fair share of Social Security, you have to bring in a Ph.D. and a programmer,” William Baldwin remarks sarcastically in Forbes, referring to the many considerations - and configurations – through which couples can plan the claiming, and the suspension – of benefits.

In our Indiana estate planning law offices, discussions about our clients’ social security benefits are part and parcel of their estate planning.  Why so? Here's a typical scenario: With social security benefits providing an important – even if hardly primary - source of her own regular income, June Brown feels more comfortable making substantial current gifts of cash and assets to her three children (as opposed to waiting and leaving those assets as an inheritance).

Most people can give away property without needing to pay federal gift taxes, points out, since most states do not have gift taxes and the federal gift tax limit is $11.18 million. And, as Maryalene LaPonsie adds in U.S. News, one of the best ways to ensure your money stays in the family is to simply give it to your heirs while you’re alive.”  One factor to take into consideration, of course, is one’s own income needs. Social Security benefits already being collected make up an important component of that income flow.

While the attorneys at Rebecca W. Geyer & Associates do not offer tax or retirement planning advice, estate planning overlaps both these areas. Our goal is to coordinate our efforts with those of other advisors in order to address all aspects of a clients’ financial plan. Meanwhile, we can assist you in maximizing your Social Security benefits, with the reassurance of regular income allowing for flexibility in designing a gifting plan.

- by Rebecca W. Geyer