What is a Power of Attorney?

A lot of you may have heard of a “Power of Attorney”, also known as “attorney-in-fact”, but perhaps not all of you really know what it is exactly. There are two broad categories of powers of attorney: 1) Property Power of Attorney; and 2) Health Care Power of Attorney. We’ll address the health care power of attorney in a future blog, one that deals with a few separate documents that deal with health care matters. What I want to talk about here is the property power of attorney.

By assigning someone as your power of attorney, you give him or her the ability to make decisions on your behalf. In the case of a property power of attorney, you are giving someone the ability to make financial and legal decisions on your behalf.

The extent of power given to the power of attorney depends almost exclusively on the document itself. The authority can be as expansive or limited as the document allows, with certain exceptions and limitations imposed by law (e.g. one cannot delegate the authority to have another execute a will on his or her behalf). When in doubt, read the thing!

A power of attorney can either be “durable” or not. “Durable” means the power of attorney remains effective upon the incapacity of the “principal” (i.e. the person executing the document). This is an important time for someone to have the authority to act on you behalf, so I would almost always suggest making the power “durable”.

The power of attorney can also be “springing” or “immediate upon execution”. “Springing” means that the authority only arises upon the happening of some event (e.g. deemed incapacitated by two doctors), while “immediate upon execution” means as soon as the principal signs the document, the “agent” (i.e. first person named as power of attorney) has the authority to act on behalf of the principal.

It is really important for ANY person over the age of 18 to have a power of attorney in place. You never know when something terrible might happen, where you’ll need someone who can act on your behalf. Or maybe it is just a matter of convenience. You may travel a lot and need someone to be able to handle your affairs if you are out of the country. Parents, when your children head off to college, even though you may still be paying the bills, your right to legally act on behalf of your child ends when he or she turns 18. You will want a property power of attorney and a health care power of attorney in place.

If you are over 18 years old, then it is never too early to be prepared and to designate the person YOU CHOOSE to be able to act on your behalf on financial and legal matters. You can tailor the document to meet exactly your needs.

If you have specific needs or questions, it’s always best to speak directly with an attorney. Although our firm generally serves the Greater St. Louis metropolitan area, we would love to help you with any Estate Planning or Elder Law needs.

Even if you are outside of the Greater St. Louis area, feel free to call our office at 314-966-8077 or email me at pgantner@yourestatematters.com. If we cannot help you ourselves, we would be happy to refer you to an attorney in your area.

Don’t forget to check out Purcell & Amen, LLC on Facebook and Twitter!

Also visit us online at www.yourestatematters.com.

Best,

Paul Gantner
Attorney at Law

*The choice of a lawyer is an important decision and should not be based solely upon advertisements.

One Years’s Advance Funding of the V.A.

We have just received some good news for Veterans via The American Legion. President Obama has just signed a bill providing for one years’s advance funding of the V.A. in order that program continuation is assured. Our law firm is increasingly involved in helping Vets and their spouses and surviving spouses to obtain Aid and Attendance Benefits to assist with personal care and housekeeping. Its a great benefit that has been well earned. If you know of anyone who was a wartime vet or married to one, and could use some help paying for nursing care send them our way! DSP

Visit us online at www.yourestatematters.com

*The choice of a lawyer is an important decision and should not be based solely upon advertisements.

How will I Pay for Mom and Dad’s Long Term Care?

One of the greatest fears of older Americans is that they may end up in a nursing home. This not only means loss of personal autonomy, but also a tremendous financial price. Depending on the location and level of care, nursing homes can cost between $3,000 and $10,000/month!  It’s a difficult decision just to determine that mom or dad needs to enter a long term care facility.  But now you’re faced with a huge problem: How will I pay for mom and/or dad’s long term care?

As an Estate Planning and Elder Law law firm, this is one of the most common worries that our clients express at the initial consultation.  Unfortunately, often times this becomes a concern only AFTER mom or dad has entered a long term care facility.  At this point our available options are much fewer in number.  But don’t worry, options do still exist!

There are essentially 3 different ways that clients can pay for long term care.  While the first two options are relatively simple and straightforward, it is the third option that, with appropriate planning and foresight, can offer the most benefit.

One option for tackling long term care expenses is to self pay.  Most people end up paying for nursing home care out of their savings until they run out. Then, at that point, they can qualify for Medicaid to pick up the cost going forward. Well, what if mom or dad would like to save some money for a healthy (“community”) spouse? What if they would like to leave money to you, their children?  Through careful planning, especially in advance of this need, you can help protect your parent(s) estate.

A second option for paying for long-term care is to purchase long-term care insurance.  There are certainly some advantages to purchasing long-term care insurance: 1) You choose how you will pay for long-term care; 2) You choose where the care will be received; and 3) You can choose who will provide the care.  There are two major problems with the long-term care insurance route.  First, people often buy a policy that is insufficient to pay for the entire cost of care.  If the nursing home costs $180/day, and policy that pays $30/day is not very helpful.  It is a good idea to be sure your policy adjusts its payments with the increases in cost of care over time.  The second issue we often see is that, by the time we think about long-term care insurance, mom and dad are uninsurable!  It’s too late!

Your third option to check out is whether or not mom or dad is (or can be) eligible for a government benefit.  To maximize government benefits, it’s very helpful to start planning at least five years before mom or dad would need to enter a long-term care facility.  However, some benefits may begin right away!  There are two government benefits, which I will briefly discuss, that are not utilized as much as they could be.  There are many people that could easily qualify with some simple planning and some of these people are already qualified!

MEDICAID

The reason planning needs to begin five years before nursing home care will be needed is because Medicaid in Missouri has a five-year “look back”.  This means essentially that when you apply for Medicaid, the State will “look back” five years to make sure mom and dad haven’t given away any of their assets.  If they have given away any assets (including to an irrevocable trust), then a “penalty period” is created.  This penalty period creates a period of ineligibility for Medicaid benefits, which will not begin to run until mom or dad otherwise qualifies for Medicaid and the application is submitted.  The length of the “penalty period” depends on the size of the transfer.

To be eligible for Medicaid, one must be at least 65 or blind or disabled.  The applicant must also have less than $1,000 in “countable assets”.  Finally, the applicant’s long-term care expenses should exceed his/her income.  (This makes sense, since the State will take mom and/or dad’s income and, in exchange, will pay the long-term care expenses).  “Countable assets” are essentially any asset in mom or dad’s name other than: 1) their homestead; 2) one vehicle; and 3) EITHER a) life insurance with cash value under $1500; b) burial plot; c) burial plan; d) pre-paid funeral.

For specific solutions to your parent(s) Medicaid eligibility, please seek the guidance of an Estate Planning and Elder Law attorney.

VETERANS AID AND ATTENDANCE

The second government benefit, is a benefit that not near enough people know about: Veterans Aid and Attendance.  It is available to all (honorably discharged) veterans who served at least 90 days active duty, 1 day of which was during a period of war (the veteran NEED NOT have served in combat). This benefit provides supplemental income to disabled or older veterans who are disabled for reasons other than service-connected injuries or illnesses and who have a low income.  This benefit is also available for surviving spouses or dependent children of deceased veterans.

It is abosultely amazing to me, the amount of people eligible for this benefit who do not no about it.  According to the 2007 Statistical Abstract of the United States for the most recent year of 2005.  There were 7,091,000 living veterans, over 65, of the Korean Conflict, Vietnam War, WWII or the Gulf War.  There were also an estimated 4,369,000 surviving spouses or dependent children of deceased veterans.  This makes a combined 11,460,000 potential Aid and Attendance beneficiaries.  In 2007, there were only 543,000 Aid and Attendance beneficiaries.  That means that only 4.7% of potential beneficiaries were taking advantage of this great benefit!

There are, of course, some other eligibility requirements based on both assets and income. 

ASSET TEST — Household cash assets or assets that can be readily converted to cash cannot exceed $80,000. There is no specific test below $80,000.  A Veteran’s Service Representative will decide on a case-by-case basis what the allowable level of assets should be. Personal residence, vehicles and personal property are exempt from the asset test

INCOME TEST — The veteran household countable income must be less than the Maximum Allowable Pension Rate.  As a practical matter, the veteran household’s unreimbursed daily living expenses must exceed total income. 

If these criteria are met, a single, living veteran can receive an additional $1644/month; a veteran couple can receive $1949/month; and a surviving spouse of a veteran can receive $1056/month.  Now that is a LOT of money to be leaving on the table!

This money could be used . . . to pay any person (including CHILDREN) to provide home care. . .to pay for PROFESSIONAL home care services. . .to pay for ASSISTED LIVING. . . or to pay for a NURSING HOME.

To determine if you or your parents may qualify for this benefit and in order to maximize your benefit with the least amount of time for processing your claim, seek the guidance a qualified Estate Planning and Elder Law attorney.

If you have specific needs or questions, it’s always best to speak directly with a licensed attorney in your area.  Although our firm generally serves the Greater St. Louis metropolitan area, we would love to help you with any Estate Planning or Elder Law needs.

Even if you are outside of the Greater St. Louis area, feel free to call our office at 314-966-8077 or email me at pgantner@yourestatematters.com.  If we cannot help you ourselves, we would be happy to refer you to an attorney in your area.

Don’t forget to check out Purcell & Amen, LLC on Facebook and Twitter!

Also visit us online at http://www.yourestatematters.com/.

Best,

Paul Gantner
Attorney at Law

*The choice of a lawyer is an important decision and should not be based solely upon advertisements.

Learning All of the Latest and Greatest New Media

I remember hearing years ago about how, with human knowledge and technology expanding at an increasingly rapid pace, we would someday find ourselves with a malady called “future shock.” In that state events and changes would be coming at us so fast that our coping mechanisms would overload. Sometimes I am not sure whether I am already there. Here I am, nearly sixty four years old, learning all of the latest and greatest new media like Linked In, Facebook, microweb pages, and the blogosphere in order to communicate with others my age or older [and yes, younger] about some universal truths that we are learning about life, death, aging and disability, family values, prudent investing and the like. Also about the rapidly changing world of estate taxes [think about it, if a billionaire dies within the next ten weeks his estate exceeding 3.5 million dollars will be taxed at 45 % or so while if he dies on January 1st or thereafter there will be no tax whatever], government benefits like Medicaid, Social Security and Veterans Administration Aid and Attendance. Our law firm is entirely devoted to trying to keep ahead of these areas of so we can advise our clients on making the best choices for the future. In addition we spend a great deal of our energy, frankly, trying to mitigate the effects of bad choices which they have made in the past. In the inimitable words of Pogo, [you remember from the comic strips?]we have met the enemy and it is us! Example:  an elderly client who, after narrowly escaping from the predations of a gold digger who was wanted in several states for financial exploitation of seniors, promptly turns around and marries another one. Big surprise: she turns out not to be quite the devoted companion he imagined.   So its Purcell & Amen to the rescue all over again!  If you log onto this blog from time to time, I’m sure you will find a lot of good information and ideas, and hopefully the experiences of others will be of value. More later DSP

*The choice of a lawyer is an important decision and should not be based solely upon advertisements.

An Introduction to the Purcell and Amen Blog: A Blog about Blogging

Blogging has become a very popular tool in the digital age. According to Wikipedia (hey, it’s ‘collective knowledge’!), “blogging” has been around for at least 15 years and has been mainstream for at least the last five years. http://en.wikipedia.org/wiki/Blog

Blogs began at the personal level as a vehicle for anything from keeping a diary you intend to share with friends and strangers alike to sharing an interesting article you’ve read. Now blogs are even being used at the corporate level for advertising, public relations, and marketing.

It seems that blogging can become a very useful tool for today’s law firm by blending the aspects of the personal blog and the corporate blog.

We believe at Purcell & Amen, that it’s important to keep our clients up-to-date with not only changes to the law, but also with the happenings our firm. Through these blogs, our firm can:

1) Pass along articles covering issues relevant to our clients;

2) Help make clients and potential clients aware of the dangers of not creating an estate plan;

3) Help make the public aware of potential pitfalls of existing estate plans;

4) Keep clients informed of new devices or new products available to protect their family and/or their estate; and

5) Answer some common questions and ease potential worries that exist in families across the United States.

Perhaps more important than any of the reasons above, a blog is a useful way to connect with our clients; a place where we can keep a constant dialogue with our clients to make sure our practice is both improving and growing to meet our current and future clients’ needs.

We welcome any comments from blog readers and appreciate any feedback. If there are particular topics of interest related to the fields of Estate Planning and Elder Law, we would be happy to do some research and pass along any findings.

Of course, we love to keep everyone connected by mentioning our upcoming seminars, any special offers or promotions, or any social events our firm is hosting.

So, here we are! Purcell & Amen, LLC has created a blog. We hope you’ll follow us as we intend to update our blog regularly with the latest and greatest in the world of Estate Planning and Elder Law.

If you have specific needs or questions, it’s always best to speak directly with an attorney. Although our firm generally serves the Greater St. Louis metropolitan area, we would love to help you with any Estate Planning or Elder Law needs.

Even if you are outside of the Greater St. Louis area, feel free to call our office at 314-966-8077 or email me at pgantner@yourestatematters.com. If we cannot help you ourselves, we would be happy to refer you to an attorney in your area.

Don’t forget to check out Purcell & Amen, LLC on Facebook and Twitter!

Also visit us online at http://www.yourestatematters.com/.

Best,

Paul Gantner

Attorney at Law

*The choice of a lawyer is an important decision and should not be based solely upon advertisements.