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Many & LoCoco Legal Blog

Wednesday, September 5, 2018

Interdictions


Interdiction is its own area of Louisiana Law, yet one that is not understood by a lot of clients. So this brief article will attempt to explain just what it is and the procedure required to obtain a Judgment of Interdiction. Of course, the Tom Benson matter did bring the world of Interdictions to the forefront of the news media.

WHAT IS THE PURPOSE OF INTERDICTION?

For some members of our society, legal protection may be necessary even after they have entered adulthood.  These individuals may have been injured in an accident, continue to suffer from an incapacitating physical illness or psychological disorder, or because of their age, they are prevented from caring for themselves.


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Thursday, August 30, 2018

Self-Settled vs Third-Party Special Needs Trusts

Special needs trusts allow individuals with disabilities to qualify for need-based government assistance while maintaining access to additional assets which can be used to pay for expenses not covered by such government benefits. If the trust is set up correctly, the beneficiary will not risk losing eligibility for government benefits such as Medicaid or Supplemental Security Income (SSI) because of income or asset levels which exceed their eligibility limits.

Special needs trusts generally fall within one of two categories: self-settled or third-party trusts. The difference is based on whose assets were used to fund the trust. A self-settled trust is one that is funded with the disabled person’s own assets, such as an inheritance, a personal injury settlement or accumulated wealth. If the disabled beneficiary ever had the legal right to use the money without restriction, the trust is most likely self-settled.

On the other hand, a third-party trust is established by and funded with assets belonging to someone other than the beneficiary.

Ideally, an inheritance for the benefit of a disabled individual should be left through a third-party special needs trust. Otherwise, if the inheritance is left outright to the disabled beneficiary, a trust can often be set up by a court at the request of a Tutor/Curator or other family member to hold the assets and provide for the beneficiary without affecting his or her eligibility for government benefits.

The treatment and effect of a particular trust will differ according to which category the trust falls under.

A self-settled trust:

  • Must include a provision that, upon the beneficiary’s death, the state Medicaid agency will be reimbursed for the cost of benefits received by the beneficiary.
  • May significantly limit the kinds of payments the trustee can make, which can vary according to state law.
  • May require an annual accounting of trust expenditures to the state Medicaid agency.
  • May cause the beneficiary to be deemed to have access to trust income or assets, if rules are not followed exactly, thereby jeopardizing the beneficiary’s eligibility for SSI or Medicaid benefits.
  • Will be taxed as if its assets still belonged to the beneficiary.
  • May not be available as an option for disabled individuals over the age of 65.

A third-party settled special needs trust:

  • Can pay for shelter and food for the beneficiary, although these expenditures may reduce the beneficiary’s eligibility for SSI payments.
  • Can be distributed to charities or other family members upon the disabled beneficiary’s death.
  • Can be terminated if the beneficiary’s condition improves and he or she no longer requires the assistance of SSI or Medicaid, and the remaining balance will be distributed to the beneficiary.

Chip LoCoco

Attorney at Law
 


Tuesday, August 14, 2018

Why should your College Age Child Execute a Power of Attorney?

When we think of a Power of Attorney, we often think that they apply to our elderly parents and being able to act on their behalf, financially, receive medical information, and make medical decisions for them.

However, we often overlook the importance of this document for our children who have attained the age of majority. (In Louisiana, that age is 18.) Imagine, your daughter, who just turned 18 the day before, leaves for college, miles and miles away.  Suddenly, just two nights later, you receive a frantic phone call from her roommate that your child just collapsed that night and was rushed to the hospital.


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Saturday, May 12, 2018

Common Estate Planning Mistakes Regarding IRAs.


For many people, retirement savings accounts are among the largest assets they have to bequeath to their children and grandchildren in their estate plans.  Sadly, without professional and personally tailored advice about how best to include IRAs in one’s estate plan, there may be a failure to take advantage of techniques that will maximize the amount of assets that will be available for future generations.

Failure to Update Contingent Beneficiaries

Assets in an IRA account usually transfer automatically to the named beneficiaries upon the death of the account holder, outside of the probate process.  If the account holder’s desired beneficiaries change, due to marriage, divorce, or other major life events, it is critically important to update the named beneficiaries as quickly as possible to prevent the asset from passing to an outdated beneficiary.  When updating beneficiaries, account holders should not neglect contingent beneficiaries – those individuals named to receive the asset if the primary named beneficiary is already deceased when the account holder dies.
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Thursday, March 29, 2018

A Special Recognition

We are proud to announce that our firm was just selected as one of the three top-ranked estate planning firms in New Orleans.

 https://threebestrated.com/estate-planning-lawyers-in-new-orleans-la

Thanks for all of your support.


 

 


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Tuesday, March 20, 2018

A Primer on Irrevocable Trusts

Many individuals are aware that a will is one way to plan for the distribution of their assets after death. However, a comprehensive estate plan also considers other objectives such as planning for long-term care and asset protection. For this reason, it is essential to consider utilizing an irrevocable trust.

This estate planning tool becomes effective during a person's lifetime, but it cannot be amended or modified. The person making the trust, the grantor, transfers property into the trust permanently. In so doing, the grantor no longer owns property, and a designated trustee owns and manages the assets for the benefit of the beneficiaries.

In short, irrevocable trust provide a number of advantages. First, the property is not subject to estate taxes because the grantor no longer owns it. Moreover, unlike a will, an irrevocable trust is not probated in court. Finally, assets are protected from creditors.

Common Irrevocable Trusts

There are a variety of irrevocable trusts, including:

  • Bypass Trusts -  utilized by married couples to reduce estate taxes when the second spouse dies. In this arrangement, the property of the spouse who dies first is transferred into the trust for the benefit of the surviving spouse. Because he or she does not own it, the property does not become part of this spouse's estate when he or she dies.

  • Charitable Trusts - created to reduce income and estate taxes through a combination of gifting and charitable donations.  For example, charitable remainder trust transfers property into a trust and names a charity as the final beneficiary, but another individual receives income before,  for a certain time period.

  • Life Insurance Trusts - proceeds of life insurance are removed from the estate and ownership of the policy is transferred into the trust. While insurance passes outside of the estate, it is factored into the value of the estate for tax purposes, so this vehicle is designed to minimize estate taxes.

  • Spendthrift Trusts – designed to protect those who may not be able to manage finances on their own. A trustee is named to manage and distribute the funds to the beneficiary or directly to creditors, depending on the terms of the trust.

  • Special needs trusts - designed to protect the public benefits that many special needs individuals receive. Since an inheritance could disqualify a beneficiary from Medicaid, for example, this estate planning tool provides money for additional day to day expenses while preserving the government benefits.

The Takeaway

Irrevocable trusts are essential estate planning tools that can protect an individual's assets, minimize taxes and provide for loved ones. In the end, these objectives can be accomplished with the advice and counsel of an experienced estate planning attorney. Are they for everyone. No. Every estate plan should be tailored to each individual client. Some clients do not like the element of control they lose through a irrevocable trust as they no longer indivdually own the assets but are now owned by the trust. However, any estate plan should at least contemplate the use and need of trusts so that all options can be viewed and looked into.

Vincent B. “Chip” LoCoco


Thursday, March 15, 2018

A Primer on Advance Medical Directives

While the main objective of estate planning is to help individuals protect their assets and provide for  loved ones, there are other important considerations, such as planning for incapacity. In short, it is crucial  to plan for the type of medical care people wish to receive if a serious accident or illness makes them unable to make or communicate these decisions. By putting in place advance medical directives, such as a durable power of attorney for healthcare and a living will, it is possible to plan for these unexpected events.

Durable Power of Attorney for Healthcare

A durable power of attorney for healthcare is commonly referred to as a healthcare proxy. This estate planning tool enables individuals to designate a trusted family member or friend to make medical care decisions in the event of incapacity. This person essentially acts as an agent, and is responsible for working with doctors and other medical professionals to ensure they provide the type of medical care the incapacitated individual prefers. If a healthcare proxy is not in place, it will be necessary for loved ones to ask the court to appoint someone make these decisions. In the end, this advance medical directive protects individuals in the event of an emergency and relieves others of the burden of going to court.

Living Will

A living will is another important advance medical directive that clarifies the type of medical care an individual prefers to receive if he or she becomes terminally ill and cannot communicate decisions about end of life treatment. In particular, a living will establishes whether certain measures, such as a ventilator or a feeding tube, should be used to prolong the individual's life

Other Essential Healthcare Directives

In situations when an individual becomes critically ill and does not wish to receive extraordinary life prolonging measures, it is necessary to complete a do not resuscitate order (DNR). In the event of a medical emergency, a DNR notifies doctors, nurses and emergency personnel not to use cardiopulmonary resuscitation to keep an individual alive.

Lastly, it is also important to ensure that other healthcare providers and organizations can access an individual's medical records and history. For this reason, it is necessary to complete a HIPAA authorization - a document required by the Health Insurance Portability and Accountability Act.

In the end, the possibility of becoming ill and not being able to communicate is not something most of us want to think about. However, putting in place these important advance medical directives can give you and your loved ones peace of mind knowing that your wishes will be carried out.

 

Vincent B. “Chip” LoCoco


Thursday, January 4, 2018

Why New Parents need an Estate Plan

Becoming a new parent is a life changing experience, and caring for a child is an awesome responsibility as well as a joy. This is also the time to think about your child's future by asking an important question: who will care for your child if you become disabled or die? The best way to put your mind at ease is by having an estate plan.

The most basic estate planning tool is a will, which enables a person to determine how his or her assets will be distributed after death. Without this important estate planning tool, the state's intestacy laws will govern how these assets will be distributed. In addition, decisions about who will care for any minor children will be made by the court. For this reason, it is crucial for new parents to have a will as this is the only way to name guardians or as they are called in Louisiana, Tutors,  for minor children.

In this regard, selecting tutors involves a number of important considerations. Obviously, it is important to name individuals who are emotionally and financially capable of raising a child. At the same time, a will can also establish a trust that provides funds to be used to provide for the child's needs. Ultimately, tutors  should share the same moral and spiritual values, and childrearing philosophy of the parents.

In addition to naming tutors  in a will, it is also critical to plan for the possibility of incapacity by creating powers of attorney and advance medical directives. A durable power of attorney allows a new parent to name a spouse, or other trusted relative or friend, to handle personal and financial affairs. Further, a power of attorney for healthcare, or healthcare proxy, designates a trusted person to make medical decisions in accordance with the parent's preferences.

Finally, new parents should also obtain adequate life insurance to protect the family. The proceeds from an insurance policy can replace lost income, pay household and living expenses, as well as any debts that may have been owed by the deceased parent. It is also important to ensure that beneficiary designations on any retirement accounts are up to date so that these assets can be transferred expediently.

In the end, having a child is a time of joy, but also one that requires careful planning. The best way to protect your family is by consulting with an experienced estate planning attorney who can help you navigate the process.

Chip LoCoco

Attorney at Many and LoCoco

 


Thursday, October 19, 2017

Elder Law

What is Elder Law?

As the population grows older, many elders must face the difficult challenges of aging, such as declining health, long-term care planning, asset protection and other financial concerns. The practice of elder law is designed to assist seniors with meeting these challenges and give them peace of mind knowing that they will age with dignity.

Long-term Care Planning

The escalating costs of long-term care, including services for both medical and non-medical needs, is a daunting challenge for elders and their loved ones. In some cases, elders may need non-skilled care to assist with daily tasks of living such as dressing, feeding, shopping, and light housekeeping. Alternatively, some elders may require skilled nursing care whether provided at home, or in an assisted living facility or nursing home.

By failing to adequately plan for these needs, the cost of long-term care can easily deplete an elder's savings. A skilled elder law attorney can help explore options such as long-term care insurance, selecting the best skilled nursing facility or qualifying for public benefits such as Social Security and Medicaid.

Medicaid Planning

One option to cover the costs of long-term care is Medicaid, a federal program run by the states that provides medical assistance to low-income individuals, and those who are 65 or older. However, many elders may not qualify because their financial resources exceed the eligibility threshold. One way to protect your home and your assets is by establishing an irrevocable trust known as a Medicaid Trust.

Elder Abuse

Elder abuse, whether physical, or emotional, has been called the crime of the twenty-first century. In addition, financial abuse occurs when an individual takes an elder's property for a wrongful purposes or with intent to defraud. In these situations, an elder law attorney can serve as a dedicated advocate and protect a senior's rights.

Ultimately, an experienced and compassionate attorney can help elders plan for the challenges of aging, preserve their independence, protect their assets and enable them to enjoy their golden years.

Vincent B. “Chip” LoCoco

504-483-2332


Monday, October 9, 2017

What are Letters Testamentary?

An individual who has been named as a personal representative or executor in a will has a number of important duties. These include gathering the deceased person's property and transferring it to the beneficiaries (legatees) through a court-supervised process known as probate. In order to initiate this proceeding, the executor must first obtain what are referred to as letters testamentary. This document gives the executor the legal authority to administer the deceased person's estate.

In Louisiana, the executor, usually through the services of an attorney, petitions the court in the Parish in which the decedent lived. This requires the filing of a Petition for Probate and Appointment of the Executor. You do not need to file a death certificate with the Court to begin this process. The application includes a statement that the person has been named as the executor in the will.

In Louisiana, the law says that a will is self-proving and thus the court will not hold a hearing to appoint the executor, but instead will issue the Letters Testamentary based on the pleadings alone. 

In short, the letters allow the executor to collect the assets of the deceased which may be held by  another person or an institution such as a bank. Since banks and other institutions may want to keep the document on file, it is necessary to obtain multiple certified copies. The executor can also carry out his or her other duties such as inventorying and appraising assets, paying debts, and transferring property to beneficiaries, according to the terms of the will.

Letters of Administration

In the event a person dies without a valid will in place, an heir of the decedent, typically a legal relative, needs to petition the probate court for letters of administration. In this situation, the court will hold a hearing to appoint this individual to act as the estate administrator, issue the letters and open probate. The administrator then manages and distributes the assets according to the state's intestacy laws which generally give priority to spouses, children and parents.

In our next article, we will look at the change in succession law which now allows for an independent administration of an estate which has made the entire process so much easier.



Wednesday, May 31, 2017

What your Loved Ones Absolutely Need to Know About your Estate Plan

What Your Loved Ones Absolutely Need to Know About Your Estate Plan

The conversation about a person’s last wishes can be an awkward one for both the individual who is the topic of conversation and his or her loved ones. The end of someone’s life is not a topic anyone looks forward to discussing. It is, however, an important conversation that must be had so that the family understands  the testator’s final wishes before he or she passes away. If a significant sum is being left to someone or some entity outside of the family, an explanation of this action may go a long way to avoiding a contested will. In a similar vein, if one heir is receiving a larger share of the estate than the others, it is prudent to have this action explained. If funds are being placed in a trust instead of given directly to the heirs, it makes sense for the testator to advise his or her loved ones in advance.

When a loved one dies, people are often in a state of emotional turmoil. Each deals with grief differently and, often, unpredictably. Anger is a common reaction to loss, one of the five stages postulated to apply to everyone dealing with such a tragedy. Simply by talking to loved ones ahead of time, a testator can preempt any anger misdirected at the estate plan and avoid an unnecessary dispute, be it a small family tiff or a prolonged legal battle.

The executor of the estate must be privy to a significant amount of information before a testator passes on. It is helpful for the executor to know that he or she has been chosen for this role  and to have accepted the appointment in advance. The executor should know the location of the original will. Concerns of fraud mean that only the original copy of a will can be entered into probate. The executor should be aware of all bank accounts, assets, and debts in a testator’s name. This will avoid a tedious search for documents after the decedent passes on and will ensure that all assets are included as part of the estate. The executor of an estate should be aware of all memberships, because it will be the executor’s responsibility to cancel them. An up-to-date accounting of all assets and debts will simplify the settlement of the estate for an executor significantly.

Chip LoCoco

Attorney at Law

504-483-2332

 

 


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The Attorneys of Many & LoCoco assist clients throughout parts of Southern Louisiana, including but not limited to New Orleans, Metairie, Mandeville, Convington, Gretna, Arabi, Marrero, Westwego, Harvey, Chalmette, Kenner, and the Parishes of Orleans, Jefferson, St. Tammany, and St. Bernard, LA.



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