Articles

Is a Grantor Retained Annuity Trust Right For You?

What is a GRAT? Grantor Retained Annuity Trusts (GRATs) ­are a mechanism by which wealthier individuals and couples can transfer appreciating assets to their heirs and minimize gift or estate taxes. High-net-worth individuals and couples can use GRATs to freeze the value of their estates and transfer any increase in the value of their assets

Executors: Were You Caught With Your Pants Down By A Stock Market Crash? Here’s What You Should Have Done

Getting socked with drastic stock market losses is bad enough.  But Executors face the added problem of having to answer to disgruntled beneficiaries.  The current market meltdown illustrates an important point many Executors fail to recognize. An Executor is the person named in a Last Will & Testament who is responsible for distributing a decedent’s

Dynasty Trusts: A Tax-Efficient Way to Pass Wealth Down Through the Generations

If you want to pass money to future generations without having it subject to gift and estate taxes, then a dynasty trust may be right for you. A dynasty trust allows trust assets to be used for the benefit of multiple generations while keeping the assets out of the grantor’s and the beneficiaries’ taxable estates.

Children Are Liable For Unpaid Nursing Home Bills Of Parents Even If They Never Got Any Of The Money

Sam, Mary’s son and agent under her power of attorney, didn’t bother to seek legal advice after Mary entered a nursing home.   “She only has $60,000.  There’s nothing we can do”, he told his sisters.  Five months later, with her funds exhausted, Mary sought Medicaid to pay for her care.  To Sam’s shock and dismay

Some Social Security Beneficiaries Can Get Retroactive Payments — But at a Cost

If you need a lot of cash on hand upon retirement, Social Security offers a lump-sum payment option that’s worth six months of benefits. However, it comes at a cost. It is important to understand the details before agreeing to the payment. If you have waited beyond your full retirement age (66 for those born

Using an Intentionally Defective Grantor Trust to Transfer Assets

An intentionally defective grantor trust (IDGT) is a common estate planning tool that is used by wealthy families to transfer assets from one generation to the next while achieving significant tax savings. IDGTs are especially useful if you have assets that will appreciate significantly over time. An IDGT is “intentionally defective” because it purposely

Requiring Adult Children to Pay for Aging Parents’ Care

Did you know you could be responsible for your parents' unpaid bills? More than half of all States currently have laws making adult children financially responsible for their parents, including their long-term care costs. Among those States, Pennsylvania is perhaps the most notorious. In most States, these laws are rarely enforced. Not so in Pennsylvania.

The Tax Consequences of Selling a House After the Death of a Spouse

If your spouse dies, you may have to decide whether or when to sell your house. There are some tax considerations that go into that decision. The biggest concern when selling property is capital gains taxes.  A capital gain is the difference between the "basis" in property and its selling price. The basis is the

You Can ‘Cure’ a Medicaid Penalty Period by Returning a Gift

Anyone who gifted assets within five years prior to applying for Medicaid may be subject to a penalty period, but that penalty can be reduced or eliminated if the assets are returned. In order to be eligible for Medicaid, you cannot have recently transferred assets. Congress does not want you to move into a

Medicaid’s “Snapshot” Date and Its Crucial Impact on a Couple’s Financial Picture

When a married person applies for Medicaid, the Medicaid agency must analyze the income and assets of the applicant and the applicant’s spouse as of a particular date to determine eligibility. Elder Law attorneys refer to this as the “snapshot” date.  It can have a major impact on a couple’s financial future. In order to