Medicaid is a combined State and Federal program that provides health benefits to individuals who need skilled nursing care. Unlike Medicare, which is an entitlement program for all seniors, Medicaid is available only to those meeting strict income and asset criteria. Medicare will only pay for a very limited amount of time in a nursing home. After that, an individual needing care must either privately pay or "spend down" assets to qualify for Medicaid. With proper planning, individuals can protect their assets from the spend down and still receive Medicaid benefits.
A revocable trust (also sometimes called a living trust) is usually created by an individual in order to avoid having to probate an estate. A trust can also be desirable for people who own real estate in another state, own unique assets they wish to provide ongoing management for, or have minor children or other special family situations. Living trusts are not necessary in all cases, however. They can be costly to set up, and there are less expensive alternatives to avoid probate.
"Probate" is the legal process of proving the legitimacy of the will and administering the decedent's estate. The process is typically not overseen by a court, but supervised administration is available. Only assets subject to probate (which generally do not include assets like annuities, life insurance, IRAs, 401(k)s, joint bank accounts and jointly-owned real estate) must go through this process. Also, estates smaller than $50,000 do not need to go through probate and may be distributed to beneficiaries through a simple affidavit.
The term "death taxes" has been used to refer to both the Federal estate tax and Indiana's inheritance tax. The Federal estate tax exemption is currently over $5 million for singles and $11 million for married couples. Indiana's inheritance tax was repealed as of January 1, 2013. As a result, the vast majority of Indiana estates will not owe an estate or inheritance tax. For those estates still subject to the estate tax, proper planning can eliminate or reduce potential tax exposure.
The cost to develop your estate plan and prepare the documents will depend on your unique situation, including the number of people (i.e., single person or married couple), the complexity of your case, and the goals you would like to accomplish. This can involve drafting other documents, such as a power of attorney, health care representative declaration, living will, trust, and/or deed(s). Please contact us to set up a consultation appointment so we can discuss your needs with you and quote you a flat rate for the work to be done.