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Sunday, November 30, 2008

Non-Profit Leads Push for Tax Credit for Special Needs Families

A Florida non-profit organization has begun a petition drive urging Congress to offer a tax credit to families of children with special needs to assist with the costs of obtaining guardianship.

Prosperity Life Planning, the organization behind the petition, teaches families of children with special needs how to locate resources for their children while preserving access to government benefits. According to a recent article in US News and World Report, the organization decided to pursue the petition because "families often can't afford to set up a guardianship, which involves court expenses and doctors' fees, so they don't do it."

Once a child turns 18, parents’ legal relationship with the child changes because suddenly it is presumed that the child has the ability to make decisions on her own, regardless of her abilities. At this point, one option is to become the child's legal guardian so that the parents can continue to make the important medical and financial decisions on child’s behalf. The proposed tax credit would give families an incentive to pursue guardianship, which many avoid because of the costs.
Prosperity Life Planning is proposing that a tax credit of up to $5,000 would be available to reimburse families for the legal fees they incur in order to obtain guardianship of their child.

The same tax credit could also be used to help families establish a supplemental needs trust for their child with special needs. These trusts are used to preserve assets for a person with special needs in order to supplement any benefits he receives from the government. According to the proposal, the tax credit should be made available to any family member of a child with special needs who pursues guardianship or intends to draft a supplemental needs trust (especially in situations where a child is being raised by family members other than her parents) and would be tracked using the child's Social Security number, so only one tax credit per child could be used.

Prosperity Life Planning points out that the government already provides numerous tax incentives for programs that benefit the public, including tax-deductible retirement accounts and education tax credits. Prosperity Life Planning argues that families of children with special needs face greater challenges than most with minimal government resources to assist them.

To read more about the tax credit proposal, and to download a statement that you can mail to Prosperity Life Planning to show your support for their initiative, go to

Friday, November 28, 2008

Elder Mediation Resolves Family Conflicts

“My daughter is insisting I move in with her,” complains Martha. “She just wants to control my life and take away my freedom,” she continues.

Jenny, Martha’s daughter worries that her mother keeps falling, and fears one day she will break her hip or hit her head.

“I’ll take my sister to court before I will let her get control of mom and my inheritance,” exclaims Jim about Jenny’s desire to move her mother in with her.

It is amazing how quickly formerly cordial relationships between family members will sour when the family has to deal with care of elderly parents or inheritance at their death. Sometimes the consequence of dealing with the final years of elderly parents can break families apart and create long-lasting animosity.

The National Care Planning Council has seen an increase in requests from caregiving children for help in solving disputes with siblings. In one case, the caregiver was being sued by her sister for abusing their parent and stealing the Social Security checks. In another, the caregiving child would not allow siblings to see their mother, claiming they would take advantage of her.

A lot of times it is a “she said,” “he said” situation with neither party really understanding what the elder person needs or wants.

Some families find it hard to communicate with each other when their parent is in need of care. Perhaps when they grew up together they were not accustomed to come together as parents and children to work out problems. And now those children are older and taking care of parents and they don't have this family council strategy to rely on. It may seem unnatural to them. But that is often exactly what is needed, especially in situations where perhaps one child is caring for the parents and the others are left out of the loop.

Children all have a common bond to their parents and as a result a common obligation or responsibility to each other. When disagreements arise, suspicions begin to grow. Suspicions or distrust often lead to anger and the anger often leads to severing the channels of communication between family members. This can occur between parent and child or between siblings or between all of them.

It is often at this point that a neutral third party can come in and repair the damage that has been done and help correct the problems that have come about because of the disagreement.

A practitioner experienced in elder mediation is a perfect choice for solving disagreements due to issues with the elderly.


Mediation is a non-adversarial approach to solving disputes. Mediation is a process of bringing two or more disputing parties together and having them mutually negotiate a solution to their disagreement. The mediator is not a judge and does not render a decision but is there to make sure that communication flows freely between the disputing parties. Elder Mediators are trained in the art of negotiating resolutions between elderly parents and family members.

Mediation can achieve results that the family by itself may not be capable of realizing or have the expertise of achieving. Here are some reasons that make Elder Mediation so valuable.

  • A trained expert on communication gives the family a perspective it could not gain by meeting together on its own;
  • All family members involved meet and prevent problems from arising by anticipating situations that may cause disputes;
  • Allows for the mediator to invite experts such as care managers or other care providers into the meeting to educate the family and give them a new perspective;
  • Allows parents to focus on their abilities rather than their limitations;llows children to come up with and consider options not thought of previously;
  • Encourages uninvolved family members to become involved;
  • Allows parents to express wishes and desires that had previously gone unuttered;
  • Allows for a neutral third party to challenge family members and make them take responsibility for their actions;
  • Promotes consensus of all involved which in turn creates a much higher rate of compliance with the plan than with any other process; (the success rate for compliance with elder mediation is estimated to be about 80% to 85%)
  • Requires a written plan with specific responsibilities which makes compliance feasible.

There are many organizations and companies throughout the country providing expertise in “Elder Mediation” to help seniors and their families. You will also find that mediators often have many coincident professional accreditations such as, Professional or Geriatric Care Manager, Elder Attorney, Clinical Social Worker or Certified Mediator.

In choosing a mediator, consider your needs. Is there a need for a medical assessment to determine the type of care? Are legal concerns with inheritance or family business or power of attorney, the main need? Perhaps, just bringing the family together to communicate on what needs to be done and who will do it is the agenda for now.

In one case, after months of dispute with her parents over their health and safety issues, Connie enlisted the service of a professional care manager mediator.

“Bringing a neutral person with a professional and compassionate attitude into our disputes was the best thing for all involved,” Connie recalled. “My parents shared their concerns and listened with acceptance to mine. All of a sudden we could communicate and work out a plan that they could live with and I could relax knowing they were safe.”

Seniors Use Mediators to help the family plan for long term care.

In the National Care Planning Council's book, “The 4 Steps of Long Term Care Planning,” the process of creating your own “Care Plan” before you need it is introduced. Quoting from the book:

“If the current or future caregiver wants the other persons attending the meeting to give support with respite care, transportation to doctors, etc., everyone needs to be aware of this and in total agreement to do it. All must also be willing to work with the member of the family, friend or professional who is designated as the Personal Care Coordinator.

If you feel the communication will be strained, consider having a professional mediator present. The mediator will be able to keep things calm and running smoothly
and help work out each person's concerns.”

“The 4 Steps of Long Term Care Planning” book can be found at

Where to Find an Elder Mediator

• In your local phone book, on the internet or with your community senior services.
• References from friends and neighbors
• Contact the local area agency on aging
• Contact your state bar association
• Contact a local university or college and asked to speak to the department that provides mediation training and ask for a referral.
• On the internet look up mediation in your area
• Yellow pages in local phone books

The National Care Planning Council lists Professional Mediators throughout the United States on its website at

Monday, November 24, 2008

Holiday Blues - Depression In The Elderly

The holiday season is quickly coming upon us. If you are a caregiver for an elderly loved one, you may notice a change in your loved one's mood as the holidays approach. Perhaps you are one of many, who visit elderly parents and family during the holidays who live a distance away. When you visit you may notice that loved ones are not as physically active, or they show symptoms of fatigue or sadness and have no interest in the holiday or in their surroundings.

According to the National Institutes of Health; of the 35 million Americans age 65 or older, about 2 million suffer from full-blown depression. Another 5 million suffer from less severe forms of the illness. This represents about 20% of the senior population -- a significant proportion.

Depression in the elderly is difficult to diagnose and is frequently untreated. The symptoms may be confused with a medical illness, dementia, or malnutrition due to a poor diet. Many older people will not accept the idea that they have depression and refuse to seek treatment.

What causes depression in the elderly?
It is not the actual holiday that causes depression, but the fact that holidays tend to bring memories of earlier, perhaps happier times. Additional contributing factors that bring on depression may be the loss of a spouse or close friend, or a move from a home to assisted living, or a change with an older person's routine.

Depression may also be a sign of a medical problem. Chronic pain or complications of an illness or memory loss can also cause depression. In addition, diet can also be a factor when proper nutrition and vitamins are lacking.

As an example, Selma’s husband passed away, a few months before Christmas. Her family lived close by and would call or drop in often to check on her. Selma seemed a little preoccupied and tired, but this was to be expected as she had been the caregiver for her husband for many years. It wasn’t until the family noticed that her holiday decorations were not out and her yearly routine of Christmas card writing was not happening that they began questioning her mental and physical well being.

A trip to her physician confirmed depression, caused by not only the loss of her spouse, but a vitamin B12 deficiency. There were both mental and physical reasons for her depression.

Symptoms to look for in depression might include:

  • Depressed or irritable mood
  • Feelings of worthlessness or sadness
  • Expressions of helplessness
  • Anxiety
  • Loss of interest in daily activities
  • Loss of appetite
  • Weight loss
  • Lack of attending to personal care and hygiene
  • Fatigue
  • Difficulty concentrating
  • Irresponsible behavior
  • Obsessive thoughts about death
  • Talk about suicide

How do you know if it is depression or dementia?
Depression and dementia share similar symptoms. A recent article on gives some specific differences:

In depression there is a rapid mental decline, but memory of time, date and awareness of the environment remains. Motor skills are slow, but normal in depression. Concern with concentrating and worry about impaired memory may occur.

On the other hand, dementia symptoms reveal a slow mental decline with confusion and loss of recognizing familiar locations. Writing, speaking and motor skills are impaired and memory loss is not acknowledged as a being problem by the person suffering dementia.

Whether it is depression or dementia, prompt treatment is recommended. A physical exam will help determine if there is a medical cause for depression. A geriatric medical practitioner is skilled in diagnosing depression and illnesses in the elderly. If you are a care taker of an elderly person it may be beneficial for you to seek out a geriatric health care specialist. Click this link for more information on senior health services.

Treating depression in older people.
Once the cause of depression is identified, a treatment program can be implemented. Treatment may be as simple as relieving loneliness through visitations, outings and involvement in family activities. In more severe cases antidepressant drugs have been known to improve the quality of life in depressed elderly people. Cognitive therapy sessions with a counselor may also be effective.

As a care giver or family member of a depressed older person, make it your responsibility to get involved. The elder person generally denies any problems or may fear being mentally ill. You can make the difference in and remove the Holiday Blues from seniors suffering from depression.

The Geriatric Mental Health Foundation offers a “Depression Tool Kit.”

To find a Senior Health Care Services in your area on the National Care Planning Council website go to

The National Care Planning Council supports the work of geriatric practitioners and their services to the growing senior population. If you are a geriatric practitioner and would like to list your services with the NCPC please call 800-989-8137.

Friday, November 21, 2008

Can I Create a Trust Inside My Will?

All trusts aren't alike. When you put a trust in your will, it should be drafted precisely in order to satisfy your wishes and goals. Just any old boilerplate text or preprinted legal form won't do.

You may have one or more reasons to put a trust in your will (called a testamentary trust by lawyers). It can benefit your family, protect your money and save taxes. When the initial beneficiary dies (your spouse, perhaps), your trust can make certain other heirs chosen by you (say, children or grandchildren) will share the principal. Or you may want your favorite charitable organization to benefit. Quite likely you have other goals you want your trust to achieve.

You can set up a trust for just about any purpose. It's a remarkably versatile and flexible means to carry out your intent and assure the prudent management and eventual distribution of your assets. Let's look at some possibilities and benefits.

Types of Trusts
Testamentary trusts are often given various kinds of descriptive labels to identify their nature and purpose. Still, a trust can have multiple objectives.
  • Marital trust. You can leave some of your estate to a marital trust for your surviving spouse's benefit. The trust assets will be free of federal estate tax in your estate because of a marital deduction, but they will be subject to estate tax when your spouse dies later. You can give your spouse the right to appoint the trust remainder to anyone. Or, if you prefer, you can use a "QTIP trust" so you can name the remainder beneficiaries.

  • Family trust. Also called a bypass or credit-shelter trust, this provides lifetime financial support for your spouse. The trust assets can bypass the federal estate tax twice: first, at your death, when it qualifies for the unified estate and gift tax credit; second, on your spouse's death, when the remaining principal passes directly to your children or other beneficiaries you name. Many couples include both a marital trust and a family trust in their estate plans.

  • Other trust types. An irrevocable life insurance trust is funded by the proceeds of life insurance on your life. A trust that benefits your family first and then distributes the principal to your favorite philanthropy is called a charitable remainder trust. Trust types go on and on.

Typical and Special Trust Provisions
Trusts usually last a long time. Just as you wisely choose the right kind of trust, you should include essential terms to assure flexibility and anticipate unpredictable circumstances.

Plan Carefully
Don't take chances—make sure your trust plans fulfill your beneficiaries' needs, allow prudent investment management and shelter the assets from unnecessary taxes. See an attorney who specializes in drafting wills and trusts. Equally important, name an experienced corporate trustee.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Saturday, November 15, 2008

Spice Up Your Estate Plan By Using Trusts

Are you looking for new ways to protect your family and your money? Would you like to cut estate taxes and probate costs, too?

Trusts can be the answer. They are remarkably versatile and can broaden your estate plan. While not magical, they can produce results that seem beyond belief.

The particulars are simple. A trustee chosen by you manages the trust assets, called the principal, and pays an income to those you want to support, your beneficiaries. Your will or a separate legal document is needed to establish a trust. When you create a trust, you are referred to as the grantor or donor.

Why Would You Use Trusts Today?
A trust can be either revocable or irrevocable. A revocable living trust agreement allows you to amend or cancel the trust at any time, in case you change your mind. On the other hand, if you put a trust arrangement in your will, it will become irrevocable upon your death.

You can set up a trust for anyone for just about any purpose. Here are some typical trust arrangements.

  • Family trust. You can create a trust in your will—known as a testamentary trust—for the benefit of your spouse, children and other family members. In a typical family trust, a husband and wife set up a trust in their wills for the surviving spouse's benefit. Each directs that after his or her death, the trust shall continue for the support of their children until the children attain a certain age, say 25 or 30. Then the trustee is to turn over the principal to the children.

  • "QTIP trust." The acronym stands for qualified terminable interest property. Although the surviving spouse receives lifetime income from this trust, he or she may not have the power (other than certain limited rights) to determine the beneficiary of the remaining trust assets upon the survivor's death.

    The intent is generally to allow more control in a second marriage situation where the goals are to provide maximum financial support for the surviving spouse, but still ultimately pass the trust principal to children of the prior marriage.

  • Living trust. You might decide to create a trust for your own benefit, a trust that will remain operative while you are living. It logically is called a living, or inter vivos (Latin for "between living persons"), trust. In this case, you direct the trustee (which can be yourself or a professional trustee of your choice) to look after the trust assets, pay you the income and counsel you about the investments. You are to be kept fully informed about all transactions. You can reserve the right to amend or revoke the trust, to add or withdraw assets, and to approve investment changes. The trust can continue after your lifetime for the benefit of your family or others, and the trust assets avoid the costs and delays of probate.

A Versatile Tool
If you'd like to make a gift to our organization or another charitable organization, but you first must satisfy your own family's financial needs during your lifetime and after, a trust can be the ideal solution.

Trusts let you have it both ways—pass assets to your heirs with the least amount of tax and make a gift to us. Often trust arrangements will accomplish much more, including professional investment management and the assurance that your wishes will be fulfilled.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Tuesday, November 11, 2008

Should I Create a Joint Trust? (Should We Have One Trust or Two?)

If you're married, perhaps you and your spouse are thinking about setting up living trusts. If so, you might ask, "Can't we have just one living trust for the two of us?" Is a joint trust a good idea?

How a Joint Trust Works
First, don't confuse a joint living trust with jointly owned property. A joint trust is created by a single document that manifests your and your spouse's respective wishes about the disposition of your respective property placed in the trust. As to joint ownership, there are various forms, but the most familiar is joint tenancy with rights of survivorship, by which the share of the deceased joint owner passes automatically and outright to the surviving joint owner.

With a joint trust, community property and separate property of both spouses may be transferred into the trust and retain their character as community or separate property. Both spouses benefit from the trust during their joint lifetime. When one spouse dies, the entire trust continues for the benefit of the surviving spouse.

Estate Tax Advantages
A joint trust is most commonly used in community property states, where most of the property in the trust is characterized as community property.1 In some cases, there can be significant estate tax advantages to this type of arrangement.

Typically, the terms of such a joint trust are somewhat like this: When the first of the couple dies, the trust splits into Trusts A and B. The assets allocated to Trust A qualify for the federal estate tax marital deduction and include the survivor's share of the community property and the survivor's separate property, if any.

Example: Fred and his wife, Jean, have $5 million of community property in a joint trust. When Fred dies, normally one-half, or $2.5 million, would be allocated to Trust B, intended eventually to bypass Jean's taxable estate. However, this would generate estate tax in Fred's estate on the excess over a tax-free allowance $2 million in 2008. So, assuming Fred made no prior gifts, the excess of $500,000 will be allocated to Trust A. Result: Trust A will wind up with $3 million and Trust B with $2 million, both fully exempt from federal estate tax in Fred's estate.

However, the potential estate tax advantages must be weighed against many other factors and issues created by joint trusts.

Which Is Better?
Needless to say, arriving at a decision between a joint trust versus separate trusts is relatively complex. If you reside in a community property state, you and your advisor may wish to seriously consider a joint living trust. (One cautionary note: You may live in a community property law state, but perhaps the majority of the property you plan to place in the trust is characterized as separate property. In this case, separate trusts should be considered.)

If you reside in a noncommunity property state [Ohio is a SEPARATE PROPERTY State], each spouse's wishes and property usually are dealt with more efficiently by separate trust agreements. Ultimately, the right answer depends on your state laws and your personal circumstances. Whichever course you choose, it is imperative that your selected executor and trustee are experienced in dealing with separate and community property, and that they take all the necessary steps to maintain the original character of the property.

Your living trust will have legal and tax consequences. Equally as important, the structure of that document will have an impact on you and your beneficiaries in many other ways. Seek the counsel of an attorney who specializes in estate planning. And, of course, our organization's trust and estate planning professionals are available to assist you in exploring your options in developing this very important financial planning document.

1 Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Saturday, November 08, 2008

Discover the Flexibility of Living Trusts

A living trust is just what its name implies—a trust you establish while you're living. Living trusts can be "revocable" or "irrevocable," and there are unique characteristics to each. Although it's not normally intended to completely replace a will, a revocable living trust can be an effective way to maintain control of property during your lifetime—and a private way to dispose of it after your death.

Revocable Living Trusts
The benefits of establishing a revocable living trust—one that allows you to change the terms at any time—are many. Here are some of the most important advantages.

  • Professional management. You may not have the ability or the time now to act as your own trustee and manage your assets the way you want. A professional trustee will do that for you. You can then observe how your trustee manages your money and continually make clear to him or her exactly what you want done with your money during and after your life.

  • Probate avoidance. At your death, the revocable trust will become irrevocable. Then the assets in your living trust will bypass the expense and delay of probate. Transfers will not be public, so your privacy will be preserved.

  • Asset protection. A trust will protect beneficiaries from others (protecting children's inheritances, for example, from divorced spouses).

  • Control of terms. You may select the location of your revocable trust, thus choosing the law that will govern its operation and the interpretation of your trust instrument. By choosing the law of one state over another, it may be possible to do things that you cannot do under the laws where you are domiciled.

The Irrevocable Charitable Trust
If you are interested in making a major charitable gift but feel you can't give up the income from your assets, consider an irrevocable charitable remainder trust. Eventually [the charity] will receive what's left of the trust after your lifetime (and that of another beneficiary, if you wish), but in the meantime you'll benefit in these ways.

  • Tax savings. If you transfer long-term appreciated assets to a charitable trust, you'll receive an income tax deduction based on your age and the fair market value of the assets on the day you set up the trust. Plus, the transfer is not subject to up-front capital gains tax.

  • Lifetime income. Every year, the charitable trust pays you (or your beneficiary) either a fixed income (with the annuity trust) or variable income (with the unitrust) You make the choice when you set up your trust.
Gift Calculator See how a charitable remainder annuity trust can benefit you.

Gift Calculator See how a charitable remainder unitrust can benefit you.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Monday, November 03, 2008

A Living Trust? You Don't Need to Be Rich

The term "trust fund" conjures up images of mansions, yachts and huge fortunes. But once the province of the very rich, trusts have found themselves into the lives of many families who've never thought of themselves as wealthy.

Trusts come in myriad forms, but for middle-class families, the living trust is popular because the person creating the trust can enjoy lifetime benefits. You can deposit assets in your own trust and ask the trustee to manage them prudently and pay the income to you, so you have more time for hobbies, travel and family.

Later, there are other important advantages. The property in a living trust that survives you can avoid the costs, publicity and delays of probate and speed property distribution to your spouse or other beneficiaries. If you choose, the trust can continue for their benefit in order to provide sound investment management and reliable financial support.

What Is a Living Trust, Anyway?
Unlike a trust you might establish by will, a living trust is set up by a written agreement between you and the trustee, and it takes effect immediately.

While you can be your own trustee, you may prefer to name a professional trustee to manage the trust assets, keep good records, pay you a regular income and—should you become incapacitated—pay your household and medical bills.

A living trust can be revocable or irrevocable. The advantage of a revocable trust is that you don't give up control—you can amend its terms or even cancel it whenever you wish. On the other hand, you may want to put some of your assets in an irrevocable trust so you can achieve other significant goals.

For example, you could set up a charitable remainder trust to pay yourself a dependable income for your lifetime and then distribute the remaining principal to our organization. The substantial, current income tax savings as well as future estate tax savings of this kind of trust magnify its appeal.

Your Estate Plan, Too

A revocable living trust can be an important part of your estate plan. It's an ideal vehicle for holding title to real estate outside your home state. You can make your life insurance payable to your trust. And the trust can include a credit shelter trust provision to help minimize estate taxes and other provisions to make gifts to family and charitable beneficiaries.

Along with your attorney, we can show you how a living trust can blend your personal needs, estate plans and philanthropic intentions.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Saturday, November 01, 2008

Five Benefits of a Living Trust

Living trusts are flexible estate planning tools that can offer you many advantages, five of which are mentioned below:

1. Revocable. Because the needs of family members may change over time, a living trust normally allows you to modify trust provisions or change the beneficiaries.

2. Private. A living trust avoids the costs and delays of probate—the state-sanctioned system that oversees the administration of your estate. Because a living trust is not subject to public scrutiny, your beneficiaries and the specific amounts or percentages they receive remain confidential.

3. Continuous. Assets put in a living trust stay under the control of the trustee, until you choose differently. When the trust is established, you can name a successor trustee who will carry on financial responsibilities in the event of your incapacity or death.

4. Flexible. You may add other assets to the trust during your life. The living trust can be especially useful if you own real estate in another state by eliminating the need to have a separate probate proceeding in the other state.

5. Professionally managed. Though not exclusive to living trusts, banks are generally well prepared to act as trustee. Also, some attorneys are willing to take on the task. Through prudent investing, these individuals can help make the most of your trust's assets and ultimately deliver more money to your beneficiaries.

A living trust is a remarkable financial and estate planning tool. To secure the plan best suited to your individual needs, be sure to consult an attorney who is knowledgeable about the features and benefits of living trusts.

SOURCE: University of Georgia in an article written by Mary L. McCormack