New York Elder Law Attorney – What We Do

Documents That Keep Seniors in Control If They Become Disabled

Three documents decide what happens if you are not well enough to make your own decisions. A power of attorney lets you appoint a person to manage your financial affairs, a health care proxy lets you appoint a person to make medical decisions for you, and a living will makes known your wishes about life-prolonging treatment.

• Power of attorney

  A power of attorney gives another person, your “agent”, legal authority to act on your behalf. You choose someone you trust, such as a child, and a revocable power of attorney lets you change your agent at any time. Without one, your family may have no choice but to ask the court to appoint a guardian to make financial or medical decisions for you. That procedure is expensive and time-consuming, and the court may appoint someone you would not have chosen.

• Living will

  A living will states which life-sustaining measures, if any, you want taken when you can no longer direct the doctors. Do you want a do-not-resuscitate (DNR) instruction? Does your religion dictate a preference? What should happen to your organs? These and similar questions are answered in the living will.

• Health care proxy

  A health care proxy names the person you want to make health decisions for you when you cannot make them yourself. It is, in effect, a power of attorney for healthcare decisions.

Every Senior Should Have a Will

If you do not have a will, the court distributes your property under New York’s intestacy laws. Your estate is still divided only among your relatives, but the proportions will most likely differ from what you would have wanted. You lose the opportunity to leave out particular relatives, and children may gain access to large sums of money on turning 18.

Without a will, your family can end up inheriting attorneys’ fees, estate taxes, confusion and feuds. If you leave behind a business, real estate or investments that would be a loss to sell in current market conditions, the court might force your estate to sell them. If you leave an asset that requires management, the court might direct your heirs to manage it jointly without defining anyone’s role. That kind of co-ownership often turns into feuding over money and control, followed by years of litigation and tens of thousands of dollars spent on lawyers.

A will lets you select your executor, the person who handles your estate. You would choose someone you trust, probably a relative who is familiar with your property. Without a will, the family may disagree over whom the court should appoint, which can lead to probate litigation.

Making a will is also the right time for tax planning. Calculating your estate tax liability now, and making sure the estate will have liquid assets to pay it, can save your heirs tens of thousands of dollars. Otherwise the probate court may force your heirs to sell part of their inheritance to pay estate taxes.

A Trust to Shield Your Assets and Qualify for Medicaid

A trust can give a senior Medicaid eligibility, protection from creditors and predators, probate avoidance, privacy, continuity of income, planning for mental disability and estate tax savings. Here is how each of those works.

• Medicaid, creditors and privacy

  Several types of trust can help an individual qualify for Medicaid, including home care and nursing home coverage, so that assets are not spent on long-term care and can pass to the family. You can learn more about Medicaid trusts on our dedicated page. A properly executed and funded irrevocable trust also shields its principal from creditors and lawsuits. And because probate court proceedings are public record, anyone can find out the extent and location of your assets when you die; not so with a trust.

• Avoiding probate, in New York and elsewhere

  Probate can be expensive and slow. Property transferred to a trust does not have to go through it. If you own property in more than one state, a trust also avoids ancillary probate: on your death the property passes under the trust and no multi-state Surrogate’s Court proceedings are needed. A trust provides continuity of management as well, so that income and use of assets are not interrupted by your death or disability and your estate or business is not subject to restrictions imposed by the probate court.

• Protecting your beneficiaries from themselves and from others

  You may not want your assets to go to a child’s spouse in a divorce or as an inheritance, or to a child’s creditors in a lawsuit or bankruptcy. A trust can keep what you built in the blood family. It can also set limits on how a beneficiary spends, for example by releasing amounts only at specified ages, which protects inexperienced or irresponsible children. Minor children and grandchildren cannot manage funds at all; if they inherit outright, their parent or guardian cannot reach the money without a lengthy court proceeding and heavy oversight, with the court endorsing every check and requiring multiple reports each year. A trustee avoids all of that. If a loved one is disabled and on means-tested programs such as Medicaid or SSI, a Special Needs Trust (also called a Supplemental Needs Trust) preserves their eligibility so the government continues to pay for their care.

• Disability planning and estate taxes

  A trust lets you select a trustee, someone you trust to manage your estate if you become unable to do so yourself. Read more in Planning for Disability. Trusts can also legally save a substantial amount in estate taxes. Read How to Avoid Estate Taxes to learn about the credit shelter trust and the life insurance trust; a QTIP trust or a qualified domestic trust (QDOT) for the benefit of your spouse can further those goals.

A Guardianship to Protect Seniors from Financial Abuse

Some relatives use their relationship with an elderly person for their own gain. Elder abuse takes many forms, and financial abuse by a trusted family member can go on without the senior realizing it. Often it is far less obvious to the rest of the family than physical abuse would be.

There are clues to look for. If the senior has handed control of their finances to a family member under a power of attorney, ask whether the senior still receives the bank statements and knows what is going on in the account. If the senior does not seem to know, while money or valuables are starting to go missing, it is time to act.

The surest way to stop financial abuse is to petition to become the senior’s guardian. No one wants to think of a parent as unable to make their own decisions, but a guardianship is the most effective way to secure that parent’s finances, even against someone who is acting under a power of attorney.

In practice the first step is to have an emergency (temporary) guardian appointed so that the accounts can be frozen. That keeps the suspected abuser, often a sibling, from reaching the money while the guardianship proceeding is pending. Once a guardian is appointed, the accounts come under the guardian’s control and no further money can be taken. If the suspected abuser held a power of attorney, you can also petition for a full accounting of what they did with it, which is the best way to find out where the senior actually stands financially.

Talk to Us

If you or a parent need help maintaining a comfortable lifestyle while preserving wealth for the next generation, or if you suspect a senior is being taken advantage of, call us at 212-233-1233 or email [email protected].