Fong Law Group

Protecting Your Parents' Assets From Nursing Home Costs

Takeaways

• Nursing home care costs have been rising over time, with many older Americans who require long-term care unable to afford it.

• With proper planning, seniors may be able to rely on Medicaid to pay for this care – and still retain some of their assets – by exploring several different strategies.

The aging U.S. population means that more people will likely need nursing home care in the coming decades. Meanwhile, the cost of nursing home care is increasing — and expected to keep increasing.

With the exorbitant cost of nursing home care, many families worry about depleting their loved ones’ life savings to pay for the care they need. Private health insurance does not cover nursing home care, and while long-term care insurance is available to cover nursing home costs, these plans are also expensive and may come up short for long-term stays.

This leaves millions of Americans reliant on Medicaid to pay for nursing home care — a far from perfect solution that usually involves spending down assets to qualify. With proactive Medicaid planning, though, it is possible for someone to qualify for Medicaid and still retain some of their assets. The sooner you start planning, the more options you’ll have for protecting your parents’ assets from nursing home costs.

Odds of Needing Long-Term Care Are High

The lifetime likelihood of needing nursing home care is relatively high. About 70 percent of people who turn 65 today will eventually need some type of long-term care, including nursing home care.

About 1.3 million Americans aged 65 and older currently live in nursing homes, and about 40 percent of today’s 65-year-olds will spend some time in a nursing home before the end of their lives.

Women are more likely than men to need long-term care, and the older a person gets, the more likely they are to need it. At the same time, there has been a growing trend of younger adults (those under the age of 65) living in nursing homes, in part due to Medicaid eligibility expansion under the Affordable Care Act. Research shows that this group increased from 10.6 percent of total nursing home residents in 2000 to 16.2 percent in 2017.

Medicaid expansion has led to more people of all ages qualifying for the joint federal and state health insurance program. Intended as the “payer of last resort” when it comes to long-term care, Medicaid has become the primary nursing home insurance for millions of Americans due to the absence of any other public program covering long-term care.

In 2020, around 6 million Medicaid enrollees used the program to pay for long-term support and services. Around one in five enrollees received institutional care, such as care provided at a nursing facility.

After age 65, more than a quarter of adults receive at least 90 days of nursing home care. Thirteen percent of them receive long-term Medicaid-financed nursing home care.

Medicaid typically pays for 100 percent of nursing home costs and may be the only insurance option available for long-term stays. Long-term care insurance can be purchased, but most policies have limits on the maximum daily or monthly benefit amount and the total lifetime benefit, as well as terms and health requirements that may exclude coverage.

A nursing home stay isn’t necessarily permanent. About 15 percent to 20 percent of admissions are for short-term rehabilitation. Among current residents, the average stay is one year and four months. More than half of residents stay for at least 100 days, while 15 percent of older adults spend over two years in a nursing home.

With nursing home costs running $250 to $300 per day in some states, costs can add up quickly. The average nursing home stay of little over a year, or about 485 days, could end up costing upwards of $150,000.

Extrapolate these costs over multiple years, and they are unsustainable for many families.

Medicaid Planning Strategies

Whether a nursing home stay lasts months, years, or is permanent, you may have crunched the numbers and determined that Medicaid is the only feasible payment option for a parent’s nursing home care.

This is a “good news, bad news” scenario. The good news is that it’s possible for somebody who doesn’t currently meet Medicaid’s income and asset limits to “spend down” their excess assets to meet limits. The bad news is that these limits are generally only $2,000, which requires significant planning, since the average net worth of Americans is more than $1 million, including nearly $1.8 million for those 65 to 74.

Another upside is that not all a person’s assets count against the limit. A home, for example, is typically exempt. Someone can also own one car without exceeding Medicaid’s asset limits.

Many Medicaid spend down strategies take advantage of workarounds that allow nonexempt assets to be converted to exempt assets, thereby excluding them from Medicaid calculations. But these strategies often involve navigating a tricky five-year “lookback period” where past asset transfers are scrutinized to ensure applicants don’t give away assets to qualify for Medicaid.

Keeping these considerations in mind, there are financial planning strategies that can help to protect a parent’s assets from nursing home costs and a Medicaid spend down.

Medicaid-Compliant Annuities (MCAs)

MCAs, a type of single premium immediate annuity, allow countable assets (like cash or investments) to be converted into a stream of income that doesn’t count toward the Medicaid asset limit. The payout structure must be based on life expectancy, and once purchased, the annuity cannot be cashed out or changed; funds in the annuity are no longer accessible as assets.

Annuity income may affect your parents’ eligibility for other needs-based government programs, such as Supplemental Security Income (SSI). In addition, the state Medicaid agency must be the primary beneficiary in case of the annuitant’s death during the annuity period.

Medicaid Asset Protection Trusts (MAPTs)

Medicaid-compliant trusts, like MAPTs, hold assets for a set period, after which they transfer to beneficiaries (usually children or other family members).

Assets in the MAPT are no longer considered part of your parents’ estate for Medicaid purposes. They are legally owned by the trust, not your parents, although they may be able to benefit from these assets, such as remaining in a home transferred to a MAPT.

Creating a MAPT triggers a penalty period of Medicaid ineligibility under the lookback period that’s based on the value of assets transferred. A MAPT is therefore most effective when implemented well in advance of potential Medicaid need, often in conjunction with a parent’s estate plan.

Promissory Notes

A promissory note is a legal agreement that allows your parents to lend money to someone (e.g., a family member) who agrees to repay the money with interest over time. This converts a lump-sum asset into a stream of income.

Not all states recognize promissory notes for Medicaid planning. In states that do allow them, they may be subject to scrutiny by state Medicaid agencies. The note must clearly outline the repayment terms and the interest rate must be at or above the applicable federal rate (the minimum interest rate the IRS allows for private loans).

Interest income from the loan may be taxed at a lower rate, and the terms can be customized to meet individual needs. For the Medicaid applicant, however, the effectiveness of a promissory note is largely dependent on the borrower’s ability and willingness to repay the loan.

Life Estates

A life estate lets your parents transfer ownership of their home to a child or other family member while retaining the right to live there for the rest of their lives. It removes the home’s value from their countable assets for Medicaid purposes and may protect the family home from Medicaid estate recovery, a program that empowers states to recoup Medicaid expenses from the deceased beneficiary’s estate.

Medicaid’s lookback policy applies to life estates, so the transfer must be done well in advance of needing care. Your parents may also lose some control over the property, and there could be tax implications.

Other Spend Down Strategies

A spend down strategy might additionally include a parent spending on needs or wants that can both enhance their quality of life and help them qualify for Medicaid.

• Paying off debts, making necessary home repairs, purchasing a new car, prepaying funeral expenses, or taking a family vacation are ways to spend down assets and derive an instant benefit.
• Gifting assets to loved ones outside of the lookback period can reduce countable assets and fit into a gifting while living strategy, but annual and lifetime gift tax exemptions apply.
• If only one spouse needs nursing home care, Medicaid allows the other spouse (the “community spouse”) to retain a certain amount of income and assets.

Because state Medicaid laws and individual nursing home care needs vary, there is no “one-size-fits-all” strategy for protecting a parent’s assets from nursing home costs and a Medicaid spend down. To develop a personalized plan that avoids penalties or disqualification from Medicaid in your state and also maximizes asset protection, consult with your elder law attorney.

Wendy Williams Case Shines Spotlight on Guardianships

Takeaways

• Guardianships may be necessary to protect individuals with cognitive impairments, but they can also limit personal freedom and autonomy.

• Wendy Williams’ guardianship case highlights the importance of legal representation and proactive estate planning.

Dementia is on the rise and is affecting millions of families across the United States. As dementia erodes a person’s mental faculties, they lose the ability to manage their life. This can lead to losing money through bad financial decisions or a higher risk of injury from falls or accidents at home or in the community. To help the affected person, family members sometimes have to turn to the court system to ensure the safety and well-being of their loved one.

A court can order a person with compromised mental faculties to be placed in a guardianship or conservatorship arrangement. (Note that the terms used can vary depending on the state.) These arrangements give a mentally able person control over certain aspects of the stricken person’s life. Though the intention of such an arrangement is to protect the afflicted person, it may also end up greatly limiting their freedom and sense of autonomy.

The recent guardianship struggles of Wendy Williams, former radio personality and talk show host for The Wendy Williams Show, and the previous conservatorship lawsuit involving pop star Britney Spears have brought significant attention to the complexities and potential pitfalls of such legal arrangements. Both cases underscore the delicate balance between protecting individuals with cognitive impairments and preserving their personal autonomy.

Wendy Williams’ Dementia and Guardianship

In early 2022, financial institution Wells Fargo froze Williams’ accounts, citing concerns over unusual activity. This action led to Williams being diagnosed with primary progressive aphasia and frontotemporal dementia (FTD) and placed under a court-ordered guardianship. Williams has contested the diagnosis and claims that she is capable of managing her affairs. She has described her experience under guardianship as isolating and akin to imprisonment, expressing frustration over her lack of freedom and limited access to her finances.

Britney Spears’ Conservatorship

Britney Spears’ conservatorship, which began in 2008, placed her personal and financial decisions under the control of her father and legal representatives. Spears publicly described the arrangement as abusive, highlighting forced work schedules, restricted personal freedoms, and financial exploitation. Her testimony in 2021, coupled with the #FreeBritney movement, culminated in the termination of her conservatorship later that year.

Issues and Solutions

Both Williams and Spears experienced legal constraints that severely limited their personal and financial freedoms, despite their public personas and professional successes. These cases highlight several critical issues:

• Oversight and Accountability. Guardianships can be susceptible to misuse and overreach. Regular, independent reviews are essential to ensure that such arrangements serve the person’s best interests.
• Legal Representation. Access to knowledgeable legal counsel is crucial for individuals under guardianship who wish to challenge unjust arrangements and advocate for their rights.
• Public Advocacy. Awareness campaigns, such as the #FreeBritney movement, can shed light on potential abuses within guardianship systems and drive legislative reforms.

FTD and Related Impairments

FTD is a group of brain disorders affecting the frontal and temporal lobes, leading to changes in personality, behavior, and language. Unlike other forms of dementia, FTD often manifests at a younger age, typically between ages 45 and 65. Symptoms vary from person to person but may include impulsive actions, inappropriate social behavior, and language difficulties. People with FTD may have a family history of this type of dementia.

Aphasia affects the frontal lobe of the brain, impairing speech and language abilities, comprehension, reading, and writing. These cognitive impairments can hinder a person’s capacity to manage their personal and financial affairs, sometimes prompting the establishment of a guardianship. As progressive conditions, FTD and aphasia both tend to come with symptoms that get worse over time.

As of this writing, Williams’ guardian, Sabrina Morrissey, and her team are calling for a new medical evaluation to confirm Williams’ diagnosis.

The Importance of Estate Planning

Proactive estate planning is vital for safeguarding one’s autonomy and ensuring that personal wishes are honored in the event of cognitive decline. Key components of your estate plan may include the following:

• Advance Health Care Directive. This legal document outlines preferred medical treatments and designates decision-makers if one becomes incapacitated.
• Durable Power of Attorney (POA). A POA appoints a trusted individual to handle financial, medical, and/or legal matters on one’s behalf.
• Living Will. This legal instrument allows one to specify their desired end-of-life care and medical interventions.

Facing a dementia diagnosis can be distressing. You want to have peace of mind that your wishes regarding your care will be respected. With an attorney’s help, you can set up these legal measures to maintain better control over your affairs and reduce the likelihood of unwarranted guardianship interventions as your cognitive abilities decline.

Learn More About Coping With Dementia

The experiences of Williams and Spears serve as cautionary tales, emphasizing the need for vigilant oversight, robust legal protections, and comprehensive estate planning to protect personal autonomy and prevent potential abuses within guardianship arrangements.

Reach out to your elder law attorney if you have questions about how to care for a loved one with dementia or to plan ahead for the possibility of dementia. These professionals can offer expert help with long-term planning and health care for those diagnosed with dementia.

An attorney can help set up a guardianship if needed but also explore less restrictive options. They can aid in navigating the complexities of Medicaid and other programs that may help cover long-term care. This may include asset protection strategies, such as creating a trust, to prevent losing the patient’s wealth to long-term care costs.

Your elder care lawyer can also assist in identifying and preventing financial abuse of people with dementia, by securing financial accounts or addressing fraud or neglect concerns. If the dementia is severe, they may be able to help secure disability benefits or other assistance the person qualifies for.

Four Key Medicare 2025 Changes You Need to Know

Takeaways

• Updates to Medicare coverage in 2025 include higher costs for Parts A and B, a new option to pay for Part D prescription drugs on a monthly basis, and a cap on out-of-pocket costs for prescription drugs. In addition, Medicare coverage of some telehealth services will continue through March 2025.

Medicare is constantly evolving to adapt to the needs of older Americans, and several significant changes have been incorporated into the program in 2025. If you're a Medicare beneficiary — or soon will be — it’s important to understand how these changes will affect your coverage, costs, and access to services. Here's a breakdown of four important Medicare changes for 2025:

1. Higher Medicare Costs for Parts A and B

In 2025, Medicare beneficiaries can expect higher premiums for both Part A (hospital insurance) and Part B (medical insurance), following a general trend of annual increases. These increases are part of the ongoing adjustments that occur each year to keep Medicare’s funding in balance.

While the exact amounts you’ll pay may vary depending on your income and other factors, the base Part B premium for 2025 has risen to $185 per month (an increase from $174.40 per month in 2024). For many seniors, this will pose a challenge, particularly for those with fixed incomes. Premiums for Medicare Part B have been steadily increasing over the past decade, and 2025 is no exception. The rise in premiums is driven by the overall costs of health care, including prescription drugs.

The Part B annual deductible has also increased – to $257 (up from $240 in 2024).

Additionally, Part A deductibles and co-pays have increased for 2025. For instance, the Part A inpatient hospital deductible for 2025 is $1,676 (up from $1,632 in 2024). Medicare beneficiaries who need to stay in a hospital or skilled nursing facility for a period of time also may have to cover coinsurance costs, which have also gone up compared with the prior year.

2. Monthly Payments Option for Medicare Part D Prescription Drug Plans

Starting in 2025, there is another notable change in how Medicare Part D handles prescription drug coverage. Beneficiaries now have the option to spread out the cost of their Part D prescription drugs over 12 months.

This update will not reduce your total out-of-pocket costs for your prescription medications, per se. However, it does offer more predictable costs for your medications. This can be especially helpful for those who regularly rely on medications and have trouble paying for them in full when they pick them up from the pharmacy.

3. Coverage of Certain Telehealth Services Extended Through March 2025

Telehealth services have been a game-changer for many Medicare beneficiaries, particularly those in rural areas or with limited mobility.

Medicare initially offered temporary coverage for telehealth during the COVID-19 pandemic. This included virtual visits with doctors, mental health counselors, and other health care providers. The expanded access meant that beneficiaries will no longer were limited to in-person visits for many types of consultations, offering greater convenience and flexibility in managing their health care needs.

Telehealth has proven especially beneficial for managing chronic conditions, mental health services, and routine consultations that do not require an in-person visit. Beneficiaries should check with their health care providers to see if they’re offering telehealth services that are covered under Medicare.

In response to the growing demand for virtual health care, lawmakers are seeking to ensure that Medicare continues to cover telehealth services in 2025 and beyond. As of this writing, the American Relief Act of 2025 has temporarily extended certain telehealth services for Medicare enrollees through March 31, 2025. However, it is not yet clear whether all of these telehealth flexibilities will continue, as Congress will have to revisit this issue.

4. New Cap on Out-of-Pocket Costs for Prescription Drugs

In 2025, there will be a significant improvement to the way prescription drug costs are managed under Medicare. Under the Inflation Reduction Act, a cap has been introduced on out-of-pocket spending for Part D prescription drugs. This cap will limit the amount beneficiaries must pay for their medications each year to $2,000, providing much-needed relief to those who rely on costly medications.

Under the new rules, once Medicare beneficiaries hit this cap, they will not have to pay additional costs for their covered medications for the remainder of the year. This change is particularly important for those with chronic conditions or serious health issues that require expensive prescription drugs. The cap will help to make drug costs more predictable and manageable, ensuring that seniors aren’t burdened with excessive expenses related to their medications.

In 2026, Some Reduced Pricing on the Horizon

One other important change is in the works, although it will not take effect until 2026. At that time, Medicare beneficiaries will begin seeing significant savings on 10 high-cost prescription drugs. These medications, identified as some of the most expensive and commonly prescribed, made them a priority for cost reduction during pricing negotiations led by lawmakers last year.

Among these drugs are treatments for conditions such as diabetes, certain cancers, and heart disease, which often require ongoing medication.

By reducing the costs of these essential drugs, Medicare aims to improve access to necessary treatments, allowing beneficiaries to focus on their health rather than their finances.

This initiative not only provides immediate financial relief but also encourages better adherence to prescribed treatment plans. When patients can afford their medications, they are more likely to take them as directed, leading to better health outcomes overall. As these changes roll out, Medicare beneficiaries can look forward to a more sustainable approach to managing their health care costs, ultimately enhancing their quality of life.

Stay Informed

The changes to Medicare in 2025 will affect many aspects of health care for seniors. Beneficiaries should carefully review their Medicare plans during open enrollment to make sure they are taking advantage of all available benefits, and they should plan for the higher costs associated with the premium increases.

By staying informed and proactive about these changes, Medicare recipients can ensure they continue to receive the best possible care in 2025 and beyond. If you have questions about Medicare coverage, be sure to speak with your elder law attorney.

Staying Safe in Winter Weather: Tips for Older Adults

Winter can be an enjoyable time of the year, with holidays, time with family, and winter scenery. But it can bring challenges, especially for older adults. Keeping a home warm enough can be expensive, staying warm while outside is more difficult, and driving, and even walking can be more dangerous. Here are some ways older adults can stay safe and warm during the winter months.

Preventing Falls

Snow and ice can make outdoor areas dangerously slippery. Falls are a significant risk for older adults and can result in serious injuries. Here are some ways to reduce the risk of falling:

• Wear Proper Footwear: Wear shoes or boots with good traction and nonslip soles to provide more stability on icy or wet surfaces. Choose waterproof footwear to keep feet dry and warm.
• Use Assistive Devices: Canes and walkers can help with balance. For added safety in slippery conditions, attach an ice tip to the end of the cane or walker supports.
• Walk Carefully: When walking outdoors, take small, slow steps, and try to keep your center of gravity directly over your feet. Avoid rushing or carrying too many items that could throw off your balance.
• Keep Walkways Clear: If possible, enlist help from family or neighbors to keep your sidewalks, driveway, and porch free of snow and ice. Use ice melt or sand for added traction.
• Install Handrails: Handrails on steps and pathways can provide added support, especially in icy conditions.

Driving Safely

Winter roads can be hazardous due to snow, ice, and reduced visibility. Older adults should take extra precautions when driving during winter weather. Here are some tips for driving safely during the winter:

• Check the Weather: Avoid driving in severe winter storms. Check the forecast before planning trips and postpone any non-essential travel if conditions are poor.
• Prepare Your Car: Get your vehicle winter-ready; keep tires in good condition, top off antifreeze, and have a full gas tank. Consider keeping emergency supplies in the car, such as blankets, a flashlight, extra gloves, and nonperishable snacks.
• Drive Slowly: Reduce speed on icy or snowy roads and increase the distance between your car and the vehicle in front of you. Use headlights to improve visibility.
• Avoid Distractions: Stay focused on the road. Keep your hands on the wheel, eyes on the road, and avoid phone use or other distractions.
• Consider Alternatives: If winter driving feels too risky, consider alternative options. Ask a family member for help, take public transportation, or use a rideshare service.

Heating a Home Safely

Heating a home during winter is essential, but it’s important to avoid potential hazards, such as carbon monoxide poisoning or accidental fires. Here are some tips to keep your home warm and safe:

• Use Space Heaters with Caution: If you’re using space heaters, keep them at least three feet away from flammable objects, such as curtains or bedding, and always turn them off when leaving the room or going to sleep.
• Install Carbon Monoxide Detectors: Heating systems, especially those that burn gas, oil, or coal, can produce carbon monoxide. Install detectors in key areas of your home and test them regularly.
• Avoid Using Stoves or Ovens for Heat: Using a stove or oven as a heat source is dangerous and increases the risk of carbon monoxide poisoning.
• Check the Heating System: Have a professional inspect and service your heating system before winter. Ensuring it’s working efficiently can reduce the risk of breakdowns or safety issues.
• Layer Up: Wear warm clothing indoors, such as sweaters, thermal layers, and warm socks. This allows you to keep the thermostat lower, saving on heating costs.

Getting Appropriate Vaccinations

Winter is peak season for illnesses, such as influenza and pneumonia, which can be more severe for older adults. Keeping up with vaccinations can help protect you from seasonal illnesses.

• Flu Vaccine: The flu virus circulates more widely during winter. An annual flu shot is recommended for everyone, especially older adults, as it can reduce the severity and risk of complications from the flu.
• COVID-19 Vaccine: Staying current with COVID-19 vaccinations, including any recommended boosters, can provide additional protection during winter months when respiratory illnesses are more prevalent.
• Pneumonia Vaccine: Pneumonia can be life-threatening for older adults. Talk to your health care provider about getting a pneumonia vaccine, especially if you have chronic conditions that may increase your risk.
• RSV Vaccine: Respiratory Syncytial Virus (RSV) can cause severe respiratory infections. Discuss the newly available RSV vaccine with your health care provider.

Planning for a Safe Winter

By taking precautions, you can stay safe and comfortable throughout the winter season. Remember to keep emergency contacts on hand and communicate regularly with family and friends so they can assist if you need help. Stay warm, stay safe, and make the most of the winter months!

The holiday season offers the chance to spend time with family and discuss long-term care options and estate planning. Though these topics may seem uncomfortable at first, the sooner they are addressed, the sooner a thoughtful plan can be put in place. Working with an experienced elder law attorney can help make the process easier. They can discuss options that will best meet your unique needs.

知名藝人遽然離世, 突顯資產規劃重要

最近，一位知名藝人的離世震驚了全球華人社群。知名演員大S（徐熙媛）的驟然離世，不僅讓娛樂圈和粉絲震驚，也引發了人們對遺產規劃重要性的討論，特別是在家庭關係和子女監護的層面。

遺產規劃不僅僅是富人的事

許多人認為只有超級富豪才需要進行遺產規劃，但事實上，無論資產多寡，若無妥善規劃，任何遺產——不論大小——都可能成為法律糾紛、財務管理不善以及家庭爭端的中心。大S的離世讓我們看到，婚姻、離婚、生育等重大人生事件都應促使我們重新檢視自身的遺產規劃。

離婚與過時的遺產計劃風險

大S於2010年與商人汪小菲結婚，育有一子一女。然而，兩人在2021年離婚，並因此涉及子女監護權的問題。離婚後，如果沒有及時更新遺產規劃文件，可能會產生嚴重後果。例如：若前配偶仍然是人壽保險或退休帳戶的受益人，他可能會繼承這些資產，而不是其他指定的繼承人。若離婚前所立的遺囑未更新，可能導致前配偶仍然擁有資產的控制權。以我個人經驗為例，我的一位客戶的丈夫去世後，她發現丈夫的保險受益人仍是前妻，因為他在離婚後從未更改受益人，導致保險金最終被前妻繼承。這再次強調了遺產規劃需要與時俱進。

台灣法律對遺產分配的影響

據媒體報導，大S的遺產估值約為新台幣10億元。如果她沒有立遺囑，根據台灣的《繼承法》，她的現任丈夫將繼承一半，剩餘的一半將由兩個孩子繼承。然而，如果她立有遺囑，她則可以自由分配資產，例如將更多的遺產留給子女。此外，大S的現任丈夫具俊曄公開表示，他將放棄繼承權並將其份額轉讓給大S的母親。然而，根據台灣法律，如果他放棄繼承權，他的份額將自動歸於大S的子女，而非其母親。在美國也是如此，繼承人可以放棄繼承權，但無法指定遺產的最終去向。若具俊曄希望大S的母親獲得資產，他需先接受遺產再進行贈與，這將帶來巨額稅務負擔。因此，如果希望資產傳承給父母，應在遺產計劃中明確指定。

子女監護與資產控制權

由於具俊曄並未正式收養大S的兩個孩子，因此汪小菲很可能會獲得孩子的監護權。這將帶來一個重大問題：如果孩子繼承了大S的全部遺產，因未成年無法直接管理財產，監護人（即汪小菲）將代為管理資產。換句話說，大S的前夫將間接掌控她的遺產。如果大S生前立有遺囑，她本可以指定現任丈夫為子女的監護人，確保她的資產由她信任的人管理。然而，在沒有遺囑的情況下，前夫可能會掌握她全部的遺產。正如我在講座中常說的：「如果你沒有遺產計劃，最不希望獲得你財產的人，最終可能會成為財產的掌控者。」

美國與台灣的遺產規劃差異

在美國，如果去世者無遺囑或信託，且沒有合格繼承人，財產將歸政府所有。因此，設立信託至關重要。此外，遺產計劃應包括兩類文件：

生前文件（如財務與醫療授權書）

身後文件（如遺囑與信託）

信託相較於遺囑更具優勢，因為遺囑需經過「遺囑認證」（probate），這是一個漫長且昂貴的法律程序。在加州，遺產認證費用通常約為遺產總價值的4-5%。例如，若房產價值100萬美元，遺產認證費用可能達到5萬美元。此外，法院計算遺產認證費用時，是根據總價值而非淨值。例如，若房產總值100萬美元但仍欠銀行80萬美元貸款，法院仍會以100萬美元計算費用，而非淨值20萬美元。

信託的重要性

使用信託而非遺囑的另一個好處是隱私保護。遺囑屬於公開文件，債權人可透過法院查閱並索賠，而信託則屬私人文件，無需對外公開。此外，遺囑必須經法院批准才能執行，這使其更容易引發爭議，而信託則可直接生效，減少訴訟風險。

遺產規劃應與時俱進

許多人制定遺產計劃後便置之不理，但財務狀況變化、搬遷或家庭結構變動時，應定期檢視和更新遺產計劃，以確保其仍然符合自身意願。

為孩子建立遺產計劃

遺產規劃不僅關乎金錢，還涉及價值觀的傳承。像大S這樣對文化具有影響力的人，可以透過信託確保子女獲得教育資源，並在適當的價值觀引導下成長。她的離世提醒我們，人生無常，應提前規劃，以確保親人能夠得到妥善照顧。

結論

大S的案例強調了遺產規劃的重要性，特別是對於家庭結構較為複雜的人來說，及早規劃不僅能確保資產順利傳承，也能避免不必要的糾紛。透過周全的遺產計劃，每個人都能為摯愛的家人提供保障，確保自己的遺願得以實現。

The Social Security Fairness Act: Will It Affect You?

Takeaways

• President Biden has signed legislation that will boost monthly benefits for nearly 3 million people in 26 states who rely on Social Security.

• The Social Security Fairness Act abolishes two decades-old rules that have reduced or altogether axed benefits for some retirees.

The Social Security Fairness Act addresses long-standing issues with some provisions of the Social Security Act, primarily the Government Pension Offset (GPO) provision and the Windfall Elimination Provision (WEP). These provisions, which were originally intended to prevent double-dipping into Social Security benefits, have been criticized for disproportionately reducing or eliminating benefits for public sector employees, including teachers, police officers, and firefighters, as well as family members, such as their spouses or survivors.

The Social Security Fairness Act

The Social Security Fairness Act was introduced in various forms over the years, often garnering bipartisan support. In recent legislative sessions, the bill gained significant momentum, with numerous co-sponsors in both the House of Representatives and the Senate. Advocacy groups, unions, and retiree organizations have rallied behind the bill, highlighting the financial harm caused by the GPO and WEP.

Despite widespread support, the bill faced challenges due to concerns about the potential cost of repealing these provisions. Critics argue that the loss of revenue to the Social Security trust fund could exacerbate the program's long-term solvency issues.

After being passed by the House and the Senate, the bill was sent to President Biden on December 27, 2024. President Biden signed it into law on January 6, 2025. The Social Security Fairness Act is retroactive to the beginning of 2024. The legislation will affect nearly 3 million people nationwide.

Per its website, the Social Security Administration is evaluating how to implement the Act and will provide more information when it becomes available.

Understanding the Repealed Provisions

Government Pension Offset Provision

The GPO often reduced Social Security benefits for spouses, widows, and widowers who also receive government pensions of their own. For many public sector employees, this provision eliminated spousal or survivor Social Security benefits, creating significant financial challenges for retirees and their families.

Windfall Elimination Provision

The WEP reduced Social Security benefits for individuals who receive a pension from employment not covered by Social Security. Though designed to address perceived unfair advantages for individuals with earnings from both Social Security-covered and noncovered employment, critics argue that the WEP formula often resulted in overly severe reductions, penalizing individuals who worked in public service roles.

Other Repealed Provisions

The Social Security Fairness Act also repeals provisions that reduce Social Security benefits for individuals who receive other benefits, such as a pension from a state or local government.

The Effect on Public Sector Workers

The WEP and GPO affect millions of public sector employees in states where public pensions substitute for Social Security. The financial penalties imposed by these provisions often catch retirees by surprise, leaving them with less retirement income than anticipated.

Goals of the Social Security Fairness Act

By repealing both the WEP and GPO, advocates for the Social Security Fairness Act seek fairness for public sector workers whom they assert should not be penalized for earning pensions through their work while also benefiting from Social Security through other jobs. The Social Security Fairness Act also ensures that retirees receive the full Social Security benefits they earned, providing a more equitable retirement system. Repealing WEP and GPO will also simplify the Social Security benefits system, reducing confusion and administrative burdens.

Learn More About Social Security Benefits

The ins and outs of Social Security benefits can be difficult to understand. Your elder law attorney can help you navigate the system and ensure you receive the benefits you are entitled to.

New Law Supports Home Care, Caregivers for Military Veterans

Takeaways

• Legislation signed in January 2025 seeks to secure better access to home- and community-based care for military veterans.
• The bipartisan Dole Act also focuses on coordinating assistance for family caregivers of veterans.

On January 2, 2025, President Biden signed into law the Senator Elizabeth Dole 21st Century Veterans Healthcare and Benefits Improvement Act. The legislation represents a significant step forward in supporting the needs of veterans, their families, and their caregivers.

Named in honor of former United States Senator Elizabeth Dole, a longtime advocate for military families, the law represents a significant advancement in the services and support provided to U.S. veterans. Through the Department of Veterans Affairs (VA), this new legislation aims to enhance veterans’ access to home and community-based services (HCBS). The Act also recognizes the critical role that caregivers play in ensuring the well-being of veterans and seeks to provide them with better support and resources.

Expansion of Home and Community-Based Services

The Act requires the VA to increase access to HCBS for eligible veterans, enabling them to receive care in their own homes or communities rather than institutional settings. Before this law passed, a veteran could receive HCBS only if those services did not exceed 65 percent of the cost they would be if administered in a VA nursing home.

Under the new law, veterans can receive HCBS if the cost is equal to the cost of receiving the same care in a VA nursing home. The VA can also allow home and community-based services that exceed the cost of VA nursing home services if the VA determines that paying the higher cost is in the best interest of the veteran.

HCBS can include personal care, homemaker services, adult day health care, respite care, and other services.

Support for Caregivers

In addition, the Elizabeth Dole Act will provide enhanced training and education programs for caregivers of veterans. Such programs will seek to help them manage the unique challenges of caring for this population. The legislation also will make more veterans and their families eligible for the VA’s Program of Comprehensive Assistance for Family Caregivers.

Pilot Programs and Innovation

The law calls for the development of various pilot programs, including one focused on exploring innovative HCBS models that provide homemaker and home health care services to veterans who live in communities with a shortage of home health aides. Recognizing the importance of a skilled workforce, the Act provides funding for training programs to increase the availability of home health aides and other professionals specializing in veteran care.

Addressing Challenges for Veterans and Caregivers

Veterans often face unique health challenges, including physical disabilities, post-traumatic stress disorder (PTSD), and chronic illnesses. These conditions can make daily living tasks difficult, increasing reliance on caregivers. For many veterans, caregivers are loved ones who often sacrifice their own well-being and financial stability to provide care. By strengthening HCBS and caregiver support, the Elizabeth Dole Act addresses both veteran-specific health needs and the burdens placed on caregivers.

Other Benefits of the Legislation

The law’s emphasis on home-based care aligns with veterans’ preferences to age in place and maintain their independence. By reducing the reliance on institutional care, the legislation also has the potential to lower overall health care costs. Furthermore, the Act’s focus on caregiver support may help improve the mental and physical health of those providing care, ultimately benefiting veterans by ensuring consistent and high-quality assistance.

“The Senator Elizabeth Dole 21st Century Veterans Healthcare and Benefits Improvement Act will better support veterans, caregivers, and survivors by improving access to VA health care and benefits, expanding long-term care programs, strengthening programs for student veterans and military family members, and more,” said U.S. Senator Jerry Moran, a sponsor of the bill.

Learn More About Benefits for Veterans

Many benefits are available for veterans, although navigating the different benefit systems can be confusing. Your elder law attorney can guide you through available options and ensure you receive the benefits to which you are entitled.

Deducting Long-Term Care Insurance Premiums in 2025

The population of older adults in the United States has been growing steadily in recent years. According to the U.S. Census, the number of Americans who are age 65 and older grew more than 9 percent in just three years, from 2020 to 2023. By 2050, estimates suggest that the country will have more than 82 million seniors.

With this shift in demographics comes a rise in the need for long-term care, all while the costs for this type of care have been escalating. To help alleviate these costs, some people are relying on long-term care insurance.

You may assume that you won’t ever need long-term care services, but data shows that nearly seven in 10 adults aged 65 and over will, in fact, require it at some point in their later years. Although it does add another expense to one’s life, long-term care insurance can be helpful. Plus, keep in mind that you may be able to deduct all or some of your long-term care insurance premium when you file your taxes.

What Is Long-Term Care?

Long-term care (LTC) refers to a range of services designed to meet the medical and nonmedical needs of individuals who cannot perform basic activities of daily living on their own due to chronic illness, disability, or aging. These services can be provided at home, in community-based settings, or in specialized facilities like nursing homes and assisted living centers.

Types of Long-Term Care Services

• Personal Care: Assistance with daily living activities (bathing, dressing, eating)
• Skilled Nursing Care: Medical services provided by licensed professionals
• Rehabilitative Services: Physical, occupational, or speech therapy
• Adult Day Services: Daytime care and supervision in a community setting

What Is Long-Term Care Insurance?

Long-term care insurance (LTCI) helps cover the costs of long-term care services, which are often not covered by standard health insurance or Medicare. LTCI policies vary, but generally they cover a range of care options, including the ones listed above. The costs and benefits of LTCI policies vary as well. Some common features to consider include:

• Waiting Period: The waiting period before benefits begin, usually ranging from 30 to 90 days
• Benefit Period: The duration for which benefits will be paid, often two to five years, or for a lifetime
• Daily Benefit Limit: The maximum amount the policy will pay per day for care
• Inflation Protection: An optional feature that adjusts benefits over time to keep pace with rising cost of care

Why Consider Long-Term Care Coverage?

With the caveats and uncertainty, you may be wondering whether you should purchase an LTCI plan. Having a policy offers a variety of upsides. It can help ensure that you will have quality care when you need it so that you can maintain your independence and dignity as you age. In addition, you’ll put less of a burden on your loved ones, since they would not be solely responsible for caregiving and its associated expenses.

Learning more about the cost of long-term care in your area will also help you get a better picture. Additionally, here are some other advantages of LTCI plans to consider:

• Financial Protection: LTC services can be expensive, and LTCI helps prevent financial strain. As of 2023, the median cost of a semi-private room in a nursing home is nearly $9,000 a month.
• Preserving Savings: Coverage can help safeguard your retirement savings and assets.
• Flexibility: LTCI policies often provide a range of care options, allowing policyholders to choose the care setting that best suits their needs.
• Tax Benefits: Deductions can make premiums more affordable, particularly for older individuals and those with higher medical expenses.

To find an LTCI plan that will benefit you, you can consult an elder law or estate planning attorney, a financial advisor, or a tax professional to gain more insight.

Tax Deductibility of Long-Term Care Insurance Premiums for 2024

The Internal Revenue Service (IRS) allows taxpayers to deduct a portion of qualified long-term care insurance premiums as a medical expense, provided these expenses exceed 7.5 percent of their adjusted gross income. The tax-deductible limits vary by age group. According to the American Association for Long-Term Care Insurance, the deductible per-individual limits for 2024 are as follows:

Maximum Tax Deduction Limits for Long-Term Care Insurance in 2025

Attained Age Before the Close of 2024	Maximum Deduction for 2024
Age 40 or younger	$480 (up from $470)
Age 40 to 50	$900 (up from $870)
Age 50 to 60	$1,800 (up from $1,760)
Age 60 to 70	$4,810 (up from $4,710)
Over age 70	$6,020 (up from $5,880)

Learn More About Long-Term Care Insurance

Working with an elder law or estate planning attorney can be incredibly beneficial when researching long-term care insurance. These professionals can help you navigate the various options available and find the strategies that will work best for your unique situation. Here are a few reasons why collaborating with an attorney is a wise choice:

• Personalized Guidance: An attorney can assess your financial situation and health care needs. They can help you determine the right type and amount of long-term care insurance that aligns with your goals and budget.
• Understanding Policy Details: Long-term care insurance can be complicated, with various terms, conditions, and exclusions. Professionals in this area can assist you in deciphering the fine print, ensuring that you understand what is covered and what is not, so that you can make an informed decision.
• Integration With Your Estate Plan: Long-term care insurance should be part of your broader estate plan. An attorney can help you integrate your insurance choices with your overall estate strategy, making sure that your assets are protected and your wishes are honored.
• Tax Implications: As covered above, there are tax deductions available for LTCI premiums. An attorney can provide insights into how these deductions can affect your overall tax situation, helping you maximize your savings.
• Future Planning: Life circumstances can change, so having a long-term care plan in place is essential. With an attorney, you can create a flexible strategy that will adapt to changes in your health or financial situation over time.
• Peace of Mind: Knowing that you have a professional on your side can help you feel confident that you are making the best choices for your future and for your loved ones.

Learn more about long-term care insurance and how it could help you pay for long-term care costs as well as how it could help you preserve and pass on more of your assets by working with an experienced estate planning or elder law attorney near you. This partnership can ultimately lead to better decisions that safeguard your future and ensure your wishes are fulfilled.

為什麼每個人都需要一份生前信託來進行遺產規劃

新年是檢視和強化您遺產規劃的最佳時機。而其中一個關鍵是了解為什麼生前信託往往比僅依靠遺囑更好。

為什麼不單單依靠遺囑？

遺囑需要通過遺囑認證程序（Probate），即由法院監督處理遺產的過程。在加州，遺囑認證程序複雜、耗時（通常需要1至2年）且昂貴。遺囑認證費是根據遺產的總價值計算，而非淨價值。例如，如果您擁有一套價值100萬美元的房子，但仍有80萬美元的抵押貸款，那麼費用將基於100萬美元的總價值計算，而不是20萬美元的淨值。這可能導致遺囑認證費高達5萬美元或更多。

此外，遺囑是公開文件，這意味著任何人（包括債權人）都可以查看。遺囑認證法院會通知債權人，使其有優先權申索遺產，從而減少留給受益人的財產。

生前信託的優勢

生前信託可避免遺囑認證，並提供以下好處：

隱私保障： 信託文件不是公開的，債權人或其他人無法查看您的資產細節。

效率高： 信託管理人（受託人）無需法院批准即可分配資產，避免延遲並降低成本。

減少爭議： 與遺囑相比，信託較少引發法律爭議，因為不需要法院審核。

正確資金注入是關鍵

生前信託只有在資產正確注入時才能發揮作用。這意味著需要將資產的所有權（例如不動產、銀行賬戶、商業利益及貴重的個人財產）轉移到信託名下。若未完成此步驟，資產仍需經過遺囑認證，導致信託無法有效運作。

常見的問題

許多人使用在線工具或聘請非律師來設立信託，最後卻發現資產未被正確轉移到信託中。這一疏忽導致不必要的遺囑認證程序，增加成本和分配資產的時間，甚至引發家庭糾紛。一位經驗豐富的遺產規劃律師能確保您的信託得到正確的資產注入。

其他遺產規劃的考量

稅務規劃： 由於聯邦和州法律可能影響遺產，適當的規劃能有效減輕稅務負擔。2025年，聯邦遺產稅免稅額將增加至1,399萬美元。然而，若國會未採取行動，2026年該免稅額可能降至350萬美元，這可能影響到許多加州居民，特別是高房價地區。

受益人更新： 定期更新您在賬戶和保單上的受益人名單，避免將資產留給不想要的人（如前配偶）。

未成年子女的監護權： 確保指定適合的人選作為子女的監護人，以備不時之需。

無行為能力的規劃： 在您的遺產規劃中加入持久授權書（Durable Power of Attorney）和預先醫療指示（Advance Healthcare Directive），以避免在您無行為能力時，家人不得不經過耗時又昂貴的法院程序。

保護您家庭的未來

一份完善的遺產規劃不僅僅是財富轉移，更是確保家庭安全、減少壓力的關鍵。在新年開始之際，與經驗豐富的律師一起檢視您的計劃，確保它符合當前狀況並能有效保護您最重視的事物。

Why Everyone Needs a Living Trust in Estate Planning

The New Year is a perfect time to review and strengthen your estate plan. A critical aspect of this is understanding why a living trust is often a better choice than relying solely on a will.

Why Not a Will Alone?

A will requires probate—a court-supervised process to handle a decedent’s estate. In California, probate is complex, lengthy (1-2 years), and expensive. Probate fees are calculated on the gross value of your estate—not the net value. For example, if you own a $1 million home with $800,000 in mortgage debt, fees are based on $1 million, not the $200,000 equity. This can result in probate fees of $50,000 or more.

Additionally, a will is a public document, meaning anyone—including creditors—can view it. Probate court notifies creditors, giving them first claim on your estate. This transparency can diminish what’s left for your beneficiaries.

The Advantages of a Living Trust

A trust bypasses probate, offering several benefits:

Privacy: Trusts are not public, so creditors and others cannot access your asset details.

Efficiency: A trustee can distribute assets without court approval, avoiding delays and reducing costs.

Minimized Disputes: Unlike wills, trusts are less prone to legal challenges, as they don’t require court approval.

Proper Funding is Key

A living trust only works if it’s properly funded. This means transferring ownership of assets—like real estate, bank accounts, business interests, and valuable personal property—into the trust. Without this step, assets remain subject to probate, rendering the trust ineffective.

Common Pitfalls

Many people use online tools or non-lawyers to set up trusts, only to discover later that assets weren’t transferred properly. This oversight leads to unnecessary probate, increased costs, and potential family disputes. An experienced estate planning attorney can ensure your trust is correctly funded.

Additional Estate Planning Considerations

Tax Planning: With federal and state laws impacting estates, proper planning can mitigate tax burdens. For 2025, the federal estate tax exemption increases to $13.99 million. However, this could drop to $3.5 million in 2026 unless Congress acts, which may affect many Californians given high property values.

Beneficiary Updates: Regularly update beneficiary designations on accounts and policies to prevent unintended inheritances, such as assets going to an ex-spouse.

Guardianship for Minors: Ensure trusted individuals are designated as guardians for your children.

Incapacity Planning: Include a Durable Power of Attorney and Advance Healthcare Directive in your estate plan to avoid costly and time-consuming court proceedings if you become incapacitated.

Protecting Your Family’s Future

A well-structured estate plan is about more than wealth transfer; it’s about ensuring your family’s security and reducing stress during difficult times. Start the New Year by reviewing your plan with an experienced attorney to ensure it reflects your current circumstances and protects what matters most.