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Tag Archives: Anthony B. Ferraro

Avoiding the pitfalls of ‘portability’

In the parlance of estate planning, “portability” refers to the ability to transfer unused estate tax exemption of a deceased spouse over to the surviving spouse, who can then add it to his or her own exemption. By doing this, it may be possible for the surviving spouse to use those accumulated exemptions decades later to shield assets from the state tax at his or her death. But portability is not a magic bullet, and there are risks if you don’t plan ahead. You need to be aware of the following limitations: 1) Portability does not apply to state death ...

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The nine things everyone must know

As we begin our New Year, now is a great time to make sure you have your estate planning and long-term care planning affairs in order. The following are the nine things everyone must know: 1) The 3 Phases of Life There are 3 phases of life, and each phase requires different kind of planning. First are the Maturing Years. Second are the Senior Years. And finally, are the Post-Death Years. 2) How Health Care Reform Affects You In 2014, Medicaid will be opened to all people that do not have health insurance and whose income is up to 133 ...

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A major change in estate planning!

All of a sudden everybody wants a taxable estate! Why? Because income tax relief is now preferred over estate tax relief. We are witnessing a sea change in tax planning due to two new developments: 1) The new “portability” of the estate tax exemption for our clients. The concept of portability allows the surviving spouse (widows and widowers) to carry over the estate tax exemption of the spouse who died and add it to their own exemption amount. However, to take advantage of this action you must “elect portability.” This means your executor, with the assistance of estate tax counsel, ...

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Updating your estate plan for living, not just dying

Today, the world is quickly changing, and medical care can be both impersonal and expensive. But one area that has not changed with the times is estate planning. Traditional plans are designed to focus on just a couple of things and, when creating them, most people tend to take the easy route. Often times, people are in good health and think, “There’s nothing wrong with us now; we want our estate plan to be very simple.” In those cases, their estate plans only really focus on who will get what when they die. The truth is, most of us are ...

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Rehab stays and the Medicare loophole

Do you expect Medicare to pay for your rehabilitation in a nursing home after a stay in the hospital? Then you better know about this rule! A problem often occurs when someone goes into the hospital for surgery and then goes immediately to a skilled nursing facility (SNF) for rehabilitation (rehab). Most people assume that the rehab stay in the SNF will be covered by Medicare. Unfortunately, that is not necessarily the case. Medicare mandates that a patient must spend at least three consecutive days, meaning three midnight stays, in a hospital as an inpatient on admitted status in order ...

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The impact of Obamacare on senior planning

How will Obamacare impact the estate planning you already have? How will Obamacare affect seniors, boomers, and their Medicare? What are the steps you should take right now to protect you and your family so you do not go broke, lose your home and leave your family without a dime? The biggest fear that many people have today is of having their life savings wiped out by a debilitating illness or an extended stay in a nursing home. Add to that the uncertainty brought on by the advent of Obamacare, and many people are tempted to engage in incorrect or ...

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A cautionary note about capital gains

Warning: You can owe capital gains taxes even if your estate doesn’t owe estate taxes. How does this unwelcome surprise happen? Let’s look at an example: Dad died last year. Mom died 10 years ago, before Dad. They had “A/B trusts,” which were recommended to them by their lawyer. The “A Trust,” called the Survivor’s Trust, belonged to Dad, and the “B Trust,” called the Decedent’s Trust, belonged to Mom, because she died first. Mom owned the house and stocks at her death 10 years, which have steadily increased in value, even after Dad’s death. Problem: Even though Mom had ...

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Starting the conversation

Boomers and Seniors: How did things go so wrong? Recent studies indicate that only 48 percent of those 65 and older have even basic documents such as financial powers of attorney. Worse yet, less than 60 percent have health care powers of attorney in place. Boomers and Seniors: Estate Planning is not just for the rich! Furthermore, estate planning is not just about death and dying, but rather about living in the second half of your life. This involves consideration of the following: * How to cover living expenses during the elder years and retirement years * How to access ...

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How to prepare for long-term care

In today’s society and as we age, we must understand that the greatest threat to middle-class, senior-citizen taxpayers is the devastating cost of long-term care. The way to begin preparing is to recognize that we go through three phases in life and those phases are the: 1) maturing years, 2) senior years, and 3) post- death years. Don’t make the mistake of assuming because you had your local attorney prepare a will, trust and power of attorney that you have prepared for your long-term care. In most cases, these documents do little to help. Take these steps: 1) Recognize that ...

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Long-term care facility contracts

Nobody would buy a home without being represented by a real estate attorney. So why is it that most seniors are signing nursing home and other long-term-care contracts that require them to pay $6,000 to $10,000 a month for the rest of their lives and never give them to an elder law attorney to review? Nursing homes in our metropolitan area can cost anywhere from $6,000 to $10,000 a month. That means that the nursing home contract can cost you between $72,000 and $120,000 a year! How can you enter into a contract of this magnitude without adequate legal advise? ...

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