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We received this testimonial from a satisfied client:
“I was referred to Marco by my lender, at a time where I experienced a major life change-my divorce - and Marco was incredibly patient and thorough. He does an excellent job of explaining all of the options available. What is more, is he follows up with his clients to ensure their new trusts are fully funded. A huge miss by other attorney's I've worked with. Marco and team, thank you for your help.”
-Yve L.
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Estate and capital gains taxes can be avoided.
Wall Street has an enhanced life insurance method that benefits wealthy people and is becoming increasingly popular, according to Barron's in "New-ish Tax Planning Instrument Gathering Billions."
Life insurance is a popular estate planning tool used as a relatively simple way to even out inheritances between heirs or to provide needed cash for family members, after the policy holder passes away.
A policy is purchased, premiums paid and upon the death of the policy holder, cash is distributed to the beneficiary.
Since life insurance is a death benefit, the beneficiary does not have to pay income taxes on it when it is paid out as a lump sum.
Wall Street has an insurance dedicated fund as a complicated investment tool that gets treated for tax purposes in the same way as life insurance.
It allows people to invest money that is then managed by hedge funds, without paying any capital gains tax on the investment. When the investor passes away, the accumulated funds in the account are distributed to beneficiaries and have the same tax benefits as life insurance.
Insurance dedicated funds are not new, but they have recently started becoming more popular.
An estate planning attorney can advise you on whether an insurance dedicated fund will fit your unique circumstances.
Reference: Barron's (June 28, 2017) "New-ish Tax Planning Instrument Gathering Billions."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com
If you want your wealth to last and be available for future generations of your family, then you need to make sure that your heirs are ready to handle the responsibility of maintaining your wealth.
The ability to manage and preserve a large amount of wealth is not something most people are born with. If it were, then there would be few stories about big lottery winners ending up with less money after a few years, than they had before they won millions.
There are many stories like that.
There are also numerous stories about families that once had a lot of wealth that was lost over the generations.
These stories are actually so common that the few families who successfully preserve wealth for generations, are considered the exceptions to the rule.
Recently, the Wills, Trusts & Estates Prof Blog discussed ways to make sure your family might be one of the exceptions in "Preparing Heirs for Successful Wealth Stewardship."
The key to such success actually seems relatively simple. In practice, however, it can be difficult.
Heirs need to be trained to handle the wealth.
They need to know how to make good investments and how to avoid bad ones. They also need to learn what good uses for the money are and what type of spending would be wasteful.
Perhaps, most importantly, heirs need to know who to turn to for advice.
A good estate plan is also vital to preserving family wealth.
The wealth cannot be maintained without the proper legal instruments, but estate planning is not enough by itself.
Reference: Wills, Trusts & Estates Prof Blog (June 29, 2017) "Preparing Heirs for Successful Wealth Stewardship."
If you would like to discuss setting up your Estate Plan with an experienced attorney at Simmons & Schiavo, LLP, call (781) 397-1700 or visit our contact us webpage.
Last year, the State of California enacted a controversial new law that allows doctors to prescribe medicine to terminally ill patients that will let patients decide when to end their lives. The state has recently issued its first report on how the law is being used.
Elder law advocates have been paying a lot of attention to California's new law allowing terminally ill people to seek physician assisted suicide. The law was extremely controversial and remains so.
If it is deemed successful, then its advocates think the law can be used as a model for other states to follow. Those who are opposed to the law, are watching it closely to see if there are any problems with it that they can use to bolster their arguments.
The State of California recently issued a report about usage of the law in the first six months after it was enacted, The New York Times reports in "State: 111 Terminally Ill End Lives Under New California Law."
Life ending drugs were prescribed to 191 terminally ill patients. A total of 21 of them passed away before taking the drugs, and 111 used them to end their lives.
The fates of the remainder were not known at the time that the report was issued.
The typical patient was a terminally ill elderly person diagnosed with cancer who was receiving hospice or palliative care. In total, 173 different doctors prescribed the drug to patients.
One thing the data shows, is that the median age of the patients was 73 and the majority were over 60.
Reference: New York Times (June 27, 2017) "State: 111 Terminally Ill End Lives Under New California Law."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com
Repeal of the Affordable Care Act has been one the biggest news items in recent weeks. Changes to Medicaid in Republican proposals have received a lot of attention, but many people do not know exactly what Medicaid does.
You probably know that Medicaid is the federal government program that provides health care coverage to poor Americans. However, in the debate about the repeal of Obamacare (Affordable Care Act) and possible reductions to Medicaid in various appeal proposals, what often gets lost is exactly what that federal government program for the poor does.
Facts about the program get lost in the media noise.
It is important to know the facts, because only then can you really decide if you are for or against any changes.
NPR recently published a list of some lesser known facts about Medicaid in "From Birth To Death, Medicaid Affects The Lives of Millions," including:
Reference: NPR (June 27, 2017) "From Birth To Death, Medicaid Affects The Lives of Millions."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com
The new fiduciary rule for financial advisers has caused a lot of confusion about what is and is not allowed with retirement accounts.
On June 9, a controversial new Department of Labor rule went into effect. The rule seems simple enough. Financial advisors who give investment advice to consumers about their retirement accounts, must act as fiduciaries of those consumers.
At least for attorneys, that is a very simple idea to understand.
Nevertheless, for consumers and their advisors the new rule has caused a lot of confusion, as the Washington Post details in "A new conflict-of-interest rule for retirement savers is causing a lot of confusion."
The easiest way to understand what the new rule means, is that advisors have to act in the best interests of the people they are advising. Investment advice must be based on the best thing for the saver, not the advisor.
Therefore, if an advisor would earn a higher fee from suggesting one investment rather than another, he, or she cannot advise the saver on that basis. If the investment that pays the least to the advisor is better for the consumer, then that is the investment that must be recommended.
Many advisors are taking advantage of the new rule to make changes to how they manage retirement accounts.
The confusion surrounding the rule has given them the opportunity to make changes customers may not like and place the blame for them on the new rule.
If you are not sure if a change your advisor is making is really required by the new rule or if you should look for a different advisor, ask an estate planning attorney.
Reference: Washington Post (June 19, 2017) "A new conflict-of-interest rule for retirement savers is causing a lot of confusion."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com
One of the biggest questions in estate planning today, is whether a trust is the best option for your family.
If you were to conduct a representative poll of middle class Americans about the best way to plan for your estate, it is almost certain that the majority of respondents would suggest getting a living trust.
It is the first piece of advice you will find almost anywhere you look for estate planning information. The reason for that is complex.
One reason is that many internet companies who sell trust creation documents have been very active in pushing the benefits of trusts to get more customers. Trusts are also often the best estate planning option for people.
Nevertheless, the key is to determine what the best estate planning option is for you personally, not for society generally, as Madison.com points out in "Is a Living Trust Right for You and Your Family?."
Trusts do have many benefits over wills.
Trusts do not have to go through probate and, therefore, are not subject to the commonly cited costs and delays associated with probate.
Trust provisions do not have to be made public, as most wills do. Trusts are also a great way to control what your heirs might do with their inheritances, but “testamentary trusts” under wills do so as well.
If you really want to know whether you should get a trust, the best thing to do is to ask an estate planning attorney. Tell the attorney what your needs are and let the attorney suggest the best ways to meet those needs.
Reference: Madison.com (June 27, 2017) "Is a Living Trust Right for You and Your Family?."
If you would like to discuss setting up your Estate Plan with an experienced attorney at Simmons & Schiavo, LLP, call (781) 397-1700 or visit our contact us webpage.
Even though a vote over the Senate's bill to repeal Obamacare (Affordable Care Act) has been delayed, it is important to know whether or not it cuts Medicaid. The answer depends on how you look at it.
Very little in government is ever straightforward. One example is the Senate Republican plan to repeal and replace the Affordable Care Act.
A vote on the bill has been delayed. However, it is likely to still come at some point in the future. Therefore, what the bill proposes to do with Medicaid funding, is important for elderly people who rely on the program for their nursing home care.
On one side of the debate over the bill are Democrats, who claim that it will slash Medicaid spending. On the other side, are Republicans who claim that the bill will increase Medicaid funding, as Fox News reports in "Fact Check: Dem claims that Senate bill guts Medicaid ignore billions in new funding."
Which side is right depends entirely on how you look at the issue. If the Senate bill passes and eventually becomes law, then Medicaid funding would increase by $71 billion by 2026. However, if the Senate bill does not become law and the current law remains in place, then Medicaid funding would increase by $231 billion during the same time period.
Under either scenario, Medicaid funding increases.
The argument is over how much it should increase and whether any increases are enough to meet future costs.
In the current highly partisan climate, it can be difficult to understand what is going on, as politicians and the media discuss policy changes. For that reason, it is important to look carefully at the facts to determine what the real question is.
For Medicaid that question is this: are politicians making sure the program can continue to do what it was designed to do without the country going broke?
Reference: Fox News (June 27, 2017) "Fact Check: Dem claims that Senate bill guts Medicaid ignore billions in new funding."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com
Early signs indicate that Social Security benefits could see a dramatic increase next year. That will be welcome news for seniors whose benefits have lagged far behind their buying power.
Every year the Social Security benefits that millions of senior citizens receive on a monthly basis are supposed to increase with the cost of living. However, it has long been pointed out that it does not really happen.
The methods used by the federal government to determine cost of living adjustments are not an accurate reflection of the purchasing power of recipients. For example, since 2000 benefits have risen 43%, but senior buying power has risen 86% according to advocates.
The average increase in benefits in the last few years has only been 1%, since overall official inflation rates have been low.
That could change next year, according to Barron's in "Big Social Security Bump Could Be Coming."
Early signs indicate that a benefit increase of 2.1% is coming next year.
That is good news for seniors who have seen their benefit dollars pay for fewer and fewer of their expenses.
The bad news is what that might mean for the health of the Social Security system itself. It needs to be adjusted to make sure the Social Security Trust Fund does not run out of money in the next couple of decades, which would result in automatic steep benefit cuts.
Benefit increases are only expected for now.
No official announcement will be made until October. Therefore, seniors should not plan for raises yet.
Reference: Barron's (June 6, 2017) "Big Social Security Bump Could Be Coming."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com
Senate Republicans are planning to hold a vote on their version of repealing Obamacare by the end of June. No one knows yet what their bill contains.
Republicans in Congress are moving forward with their plans to repeal the Affordable Care Act.
The House of Representatives previously passed a bill that would do just that. It would have cut funding for Medicaid and increased health insurance costs dramatically for many seniors who have not yet reached retirement age.
A Senate version is expected soon, as Politico reports in "Senate GOP prepares for Obamacare repeal vote next week."
The biggest problem with the Senate bill from an elder law perspective, is that no one knows what the problems are.
Since President Trump is reported to have told Republican Senators in private that the House bill is "mean," it is expected that the Senate version will contain some softer provisions.
However, the negotiations over the Senate bill are being conducted behind closed doors. It is also expected that no hearings or debate will be held on the bill before it is called for a vote.
That makes it difficult for elder law advocates to determine whether the bill is supportable or not.
When details of the bill are released, it will need to be quickly and thoroughly scrutinized from an elder law perspective.
Reference: Politico (June 20, 2017) "Senate GOP prepares for Obamacare repeal vote next week."
Simmons & Schiavo, LLP • (781)397-1700 • [email protected] • www.simmonsandschiavo.com