These are the eighteen most common estate and Medicaid planning mistakes that we have observed our clients make over the past 57 years of practicing law in Western New York. Have you made any of these mistakes?
1)Believing that you are too young to need a health care proxy or power of attorney. The two famous right-to-die cases involved women in their 20s. At only 21, Karen Quinlan lapsed into a persistent vegetative state after consuming diazepam, dextropropoxyphene and alcohol at a party. Terri Schiavo was only 26 when she went into a coma when her heart stopped temporarily which cut off oxygen to her brain.
2)Not safekeeping your will, power of attorney, living will, health care proxy and living trust documents where they are accessible when needed.
3)Believing that you are too poor to need a will. Even if you have no assets now, your estate could be very substantial if you were involved in an accident.
4)Not updating your will, power of attorney, health care proxy and life insurance beneficiaries after a divorce.
5)Buying real estate with a domestic partner or child without a co-tenancy agreement.
6) Selling your home in which you have a life estate while you are in a nursing home.
7) Appointing the wrong person as your power of attorney, executor, children’s guardian or trustee.
8) Owning a business or rental property without forming a limited liability company or corporationfor business succession and asset preservation.
9) Not pre-planning your funeral.
10) Not signing a prenuptial agreement or living trust before a second marriage.
11) Not providing for your pets with testamentary trusts.
12) Adding one child to your bank account as a joint owner if you do not intend for that child to receive the entire account upon death.
13) Not having gift-giving authority in your power of attorney.
14) Not taking advantage of the Medicaid exemptions.
15)Creating a living (inter vivos) trust, but not funding it.
16) Preparing wills, powers of attorney, health care proxies, living trusts living wills and Medicaid applications yourself without an elder law or estate planning attorney.
17) Not utilizing life insurance correctly by not having enough coverage, not updating beneficiaries, not using life insurance trusts; not realizing that it is subject to estate taxes; and not realizing that it is not governed by provisions in your will.
18)Not making gifts to avoid estate tax and Medicaid.
Contact Robert Friedman at 716.542.5444 for a further explanation of the above.