Financial Planning Legal March/April 2017

Financial Planning


It Pays to Coordinate

Financial Planning


Steve had a big decision to make.

His daughter was getting married, and he wanted to give her the wedding of her dreams. To do it, he dipped into his IRA. Although the wedding was everything he and his daughter had hoped, it pushed him up into a new tax bracket, costing him thousands of dollars in additional taxes. This caused his Medicare premiums to skyrocket by more than 40 percent for the following year as well.

Steve had the resources he needed to give his daughter the wedding she wanted, but because of a lack of coordination and understanding, he paid thousands in unnecessary taxes. His mistake was focusing on only a single aspect of a major decision.

Consider a Financial Quarterback

Steve’s situation explains why it’s important that all your advisers are connected and understand the big picture. When you make a major decision like Steve did, there will be outcomes you might not have considered.

So how do you make financial decisions that have been reviewed from every angle? Try a holistic approach to your financial health that includes professionals who will help with all of your tax, insurance, legal and financial planning needs.

New advisers should be open to working with existing advisers whom you know and trust as well. It’s important for each adviser to be aware of what another is doing. Using a network of connected advisers helps people decide which decision is right for their situation.

Coordination gives clients a peace of mind that saves time and money, and lets them focus on more important things — such as wedding plans. Your goal should be to find an adviser that will make sure every financial decision is examined through the lens of all the available options so nothing is missed.

Read more 0
Legal March/April 2017 Money

Joint and Survivorship Accounts

Pros, Cons and Everything In Between

The Scoop on Joint and Survivorship Accounts





The Goal for Most People? Avoid Probate.

One method:

Joint and Survivorship accounts

Got it. How does that work?

Two people set it up

When one dies, the other owns it

Good for spouses


So what can go wrong?

Multiple owners—who gets what?

Parents leave to one child, not others

Creditors of one owner can attach the account

Divorce of one owner



What is better for non-spouses?

Payable on Death to Child

Transfer on Death to Child

Transfer on Death to Child or by Naming the Child the Beneficiary

Read more 0

You’re Raising a Grandchild – Now What? Proper legal documents can protect your rights – and theirs

Today, more and more grandchildren are being raised by grandparents for a variety of reasons. Death, illness, or drug abuse could all require changes in living circumstances.

But what rights do you, the grandparent, have with regard to raising your grandchild? Schools and medical providers want proof that you have the right to make decisions and speak for the grandchild’s interests. There are a number of ways to obtain such rights.


Ohio law was changed in July 2014 to enact the “Grandparents Caretaker Law” which provides two methods by which non-custodial grandparents can obtain caretaker rights relatively simply.

First, if you are noncustodial but need rights as to schooling or medical care, the parent can sign a caretaker power of attorney to grant the grandparent with whom the grandchild is residing. This document helps the grandparent have the ability to make decisions for care and school matters. Examples are medical, psychological or dental treatment for the child, school enrollment and school educational and behavioral information.

A parent can only grant this authority under certain hardship circumstances like serious illness, homelessness or the death of one parent, and only if it is in the best interest of the child. This power of attorney does not convey legal custody. The form must be witnessed and notarized and filed with the local county juvenile court.

Second, if the parents cannot be found after a good faith effort was made to find them, state law allows the non-custodial grandparent to sign a caretaker authorization affidavit stating that the parent is not available and the grandparent is granted the same rights as listed above. The form must be signed, notarized and filed with the local county juvenile court within five days.

Either of these two documents terminate after one year or if the child stops living with the grandparent, by court order, the death of grandparent or grandchild, or revocation.

Read more 0
Financial Planning Insurance Legal November/December 2016

Medicaid Changes – “Too Much Income” to Qualify? What Does That Mean?

On Aug. 1, 2016, the Ohio Department of Medicaid drastically changed eligibility rules for Medicaid benefits for people who are disabled and others who need long-term care.

My column in the September/ October 2016 issue of this magazine highlighted three significant changes in these new rules: How Medicaid deals with the applicant’s home, how Medicaid treats retirement funds that belong to an applicant’s spouse, and the applicability of a rule (new in Ohio) that bars Medicaid coverage for people who have too much income.


As I wrote in the last issue, “too much income” sounds weird. But because Medicaid provides money for medical coverage for the poor, having “too much income” can make someone ineligible for help.

Those whose gross income is higher than $2,199 per month are ineligible for Medicaid coverage for long-term care. (That amount is adjusted from time to time to compensate for inflation.) That $2,199 is not enough to pay for long-term care for most people; it would cover a few hours of home care each week.

Because the amount of income that blocks eligibility is not enough to keep up with the costs of long-term care, a method has been created to make it so that only part of a Medicaid recipient’s income actually counts as income. As an aside, don’t look for logic here. This stuff is crazy. It’s what satisfies the rules, though. The only explanation I can offer for this “too much income” thing is that these are the rules.

To make some income not count as income for Medicaid purposes, recipients can run some of their income each month through a Qualified Income Trust, commonly referred to as a Miller Trust.

“Qualified Income” is not counted as income for Medicaid eligibility purposes, and the monthly money that goes through the Qualified Income Trust is “Qualified Income.” The result is someone can become (or remain) eligible for Medicaid help with long-term care costs by using a Miller Trust.

Read more 0
Legal May/June 2016

Estate Planning for Second Marriages – “What to Do Before Saying “I Do”

Remarriages are on the rise. Four of every 10 marriages are now remarriages, and half of previously married seniors have remarried again, according to a Pew Research Center study.

Let’s say partners each have children from a first marriage, and they are getting married. What issues do they need to think about? In addition to all of the family dynamics, there are many economic and personal issues they need to consider, such as:

• Income taxes

• Prenuptial agreements

• Pension, 401k and Social Security benefits

• Cost-sharing

• Estate planning documents


Consider the following real-life example. A couple remarried in their 50s. They each had children from a first marriage. The husband died 20 years later. He wanted to provide for his second wife.  His will stated all of his assets went to his wife, with the understanding that on his wife’s death those assets would go back to his children.

However, what actually happened is when the husband died, the surviving wife — who lived a long time after that — simply combined their assets. On her death, the money went to her children. The husband’s children got nothing. They did not believe their father meant to do that with his assets. He didn’t, but he didn’t plan properly.

So, what should he have done? He should have set up what is commonly called a marital trust. The trust would have held the assets for his second wife when he died, but upon the wife’s passing the assets would go to his children. The trust document prohibits the widow from transferring the assets to her children.


As for other important documents, everyone should have a durable financial power of attorney, durable health care power of attorney and a living will declaration. When you divorce or get married, update documents to reflect your new situation.

Read more 0
Fall 2015 Financial Planning Legal

Knowing Your Rights In Power of Attorney

Millions of people have powers of attorney. However, are you opening yourself up to problems in this common estate planning document? Attorney Michael Solomon explains this document and how you can make it work for you.


A power of attorney is a simple legal document that authorizes someone you name, typically a trusted family member, to handle your legal or financial affairs. With this document your agent, the person you give it to, can step in to help when you become incapacitated.


I’ll give you a hint: a will and a trust are the wrong answers. The two most important legal documents are a financial durable power of attorney and a health care durable power of attorney. Wills and trusts are certainly important. Those are documents to plan for your estate at your death. The durable powers of attorney for finances and health care are designated to protect you during your lifetime.

The first document, the financial durable power of attorney, authorizes someone you trust, usually a spouse or child, to handle your finances. The agent you name can pay your bills, sign checks, sell stocks and generally handle your finances. If you become incapacitated or unable to handle your financial affairs, your agent under the financial durable power of attorney can easily step in to handle things.

The other document is the health care durable power of attorney. With this document, you can authorize someone to make healthcare decisions for you if you can’t make your own.


When you give someone a power of attorney, you’re giving them the power to go to the bank and take your money, or to sell the house. That’s a lot of power, and it can also lead to problems.

Read more 0
January/February 2017 Legal

Crazy Laws – Keep Your Retirement Dreams – but Watch Out

As you plan for retirement, it just might be the time to try to realize your lifelong dreams. You’ve put them off long enough; now you actually have the time. Great idea. But please be sure to follow the law when you do. There are some crazy laws on the books that just might put a damper on your plans.


For example, if you love to play bingo, and just never had time before, don’t retire to North Carolina. It’s illegal to play bingo there for more than five hours in a row. Or, if you would rather sing when you move there, you’d better be really good. Singing off-key also is prohibited.

If you vacation in Wyoming, and like to take pictures, remember that it’s illegal to take a picture of a rabbit from January to April without a permit. In Idaho, you can eat all the potatoes you want, but never wear a fake mustache in a church.

Alaskan cruises are beautiful, and you may dream of a long vacation by sea and by land. However, if the weather proves to be a bit too cold for you, be careful if you stop at a bar for some warming spirits. You are not allowed to be drunk in a bar. And right here in Ohio, it’s illegal to get a fish drunk.


If you enjoy the holidays and wish they could last forever, don’t move to Maine. Decorations have to be removed and stored by Jan. 14. On the other side of the country, they don’t like folks with a sweet tooth; lollipops are banned in Washington.

Florida women might have their dreams dashed because unmarried females cannot parachute on Sundays. The need to protect women is somewhat understandable.

Read more 0

Cases & Controversies – An Open Enrollment Guide for Newcomers

For you pros at Medicare open enrollment, you know that this is when you review your Medicaid Advantage Plan, Supplement and Drug plans to make sure you are set for another year.

For newbies, there are some legal issues regarding Medicare coverage that don’t get much publicity but are very important.


Many people incorrectly think that Medicare won’t pay much for skilled care such as rehabilitation, therapy, wound dressing and other daily health needs in a skilled facility or at home. Services and Medicare billing are stopped quickly because they think that Medicare will not pay anymore if the patient is not showing “improvement” or he “fails to progress.” This idea has become pervasive in health care, and people simply accept it as the law.

However, “improvement” is not the standard by which Medicare can stop paying for skilled nursing care; it never has been. A 2011 federal class action lawsuit against Medicare was filed to help clarify coverage for millions of seniors. The government settled the case in 2012 by agreeing that under federal law people cannot be denied coverage for skilled care just because they have reached a plateau and are not improving.

Coverage is necessary if the person needs skilled care to maintain his or her condition, prevent complications or to not backslide. This is a maintenance standard, not an improvement standard.

Medicare also was required to educate all seniors receiving Medicare and all Medicare skilled care providers about the corrected policy. The Centers for Medicare and Medicaid (CMS) agreed to do so.

In 2014, they released instructions and updated Program Manuals for Medicare billing and appeals agencies. They issued a fact sheet to inform providers and the public about the change. They were supposed to spot check nursing homes, home health care agencies and other providers to make sure they were using the correct standards.

Read more 0