For over 70 years the estate planning team of attorneys at the Racine Law Office have assisted clients in creating customized estate plans. In doing so our goal is to give as much information to clients about their needs so that they can make specific decisions about their estate planning that will help them not only when they pass away but also while they are alive. Estate planning is like a tool box with many tools in it. Given each person’s circumstances, the tools that may be used to create and assist in each person’s estate planning may be different. One of the tools our clients choose to use is having a living trust as part of their estate plan. We assist our clients in not only creating a living trust but also in funding the trust and keeping it updated based on the circumstances of our client and their family and loved ones.
Our team of Pocatello estate planning lawyers includes partners Randy Budge and Lane Erickson and attorneys Nate Palmer and Dave Bagley. The attorneys on our team are experienced, knowledgeable, and have each helped hundreds of clients in creating their own customized estate plans. We do not use a cookie cutter approach when it comes to estate planning. We determine the specific needs of each of our clients and provide them with the best counsel and legal options available, so they can make the decisions that will best suit their circumstances.
When it comes to the creation and use of a living trust as part of an estate plan we spend a good deal of time with our clients to understand specifically what their needs are and how a living trust can help them. Specifically, we discuss with our clients what a Pocatello living trust cannot accomplish. There are three specific things that you should know that a living trust does not do.
1. Medical Decisions are not Controlled by a Living TrustThe first thing you need to understand is that your Pocatello living trust does not control the medical decisions that need to be made for you during your lifetime. Each adult in Pocatello has the freedom to make their own medical decisions for themselves so long as they have legal capacity. The decisions that can be made are about which doctors you will get help from, the medicines that you will take, whether you opt to receive certain medical procedures your doctor recommends, and so forth. So long as you have an understanding and can make decisions about these things you are in control of your own medical care. However, if you were to lose legal capacity such as through Alzheimer’s disease, or some other illness or injury then you can no longer make these decisions. To make sure that these decisions can still be made, other estate planning documents will assist you.
When it comes to medical decisions the most important documents that you can have in your Pocatello estate plan are your Powers of Attorney. These would include a specific power of attorney for health care. You will also have a living will. These documents allow you to name other individuals who will hold your power to make medical decisions in the event you lose the ability to make them for yourself. These documents also give you the ability to make end-of-life decisions concerning the medical care and treatment you receive if you are in a terminal condition and you cannot communicate with your doctors.
The main thing for you to understand is that your Pocatello living trust does not give another person authority to make medical decisions for you. Rather the purpose of a living trust is to give another individual the ability to handle and control your money, property, and other assets that are transferred into the trust.
2. While You are Alive, a Living Trust Does not Protect Your Assets From CreditorsThe second main thing that you need to understand about how your Pocatello living trust works is that it does not protect your assets from your creditors while you are alive. The reason for this is that most living trusts are revocable. When a trust is revocable this means you can transfer assets both into and out of the trust whenever you want to. Because of this, the law considers your living trust to be the same as you individually. As a result, creditors are still able to reach the assets that you put into a living trust so long as you are alive.
Everything changes when you die. Most living trusts that are revocable while you are alive become irrevocable after your death. When a trust has this language then creditors are not able to access the money, property, and other assets that you have transferred into the trust after your death. Rather, at this point, those items are protected and are not reachable by your creditors which means that your creditors cannot take them away from your family. Keep in mind, that your creditors can still reach any assets that you own individually that are not included as a part of your trust. From those assets your debts will be paid.
3. You Will not Qualify for Medicaid Because of a Living TrustThe final thing that you need to understand, and the thing which creates the most misunderstandings with individuals about living trusts, is that a living trust will not help you qualify for Medicaid. As is set forth above, most living trusts are revocable while you are alive. Because the trust can be revoked any of the assets that you put into the trust can be taken back out again and owned by you individually.
Because Medicaid is a program from the government created to help individuals who have no assets or money, in order to qualify for Medicaid, the eligibility requirements state that individually you cannot have above a certain amount of money or assets in your estate. These requirements are very stringent. Over the years many of the loopholes that attorneys used in the past to help an individual retain their money and assets and still qualify for Medicaid have been closed and are no longer available to individuals. As a result, in most circumstances the use of a living trust no longer qualifies to help individuals obtain Medicaid benefits.
Enlist an Idaho Estate Planning and Probate Attorney to Help YouOur experienced Estate Planning team of attorneys can help you and your family with your Idaho estate plan or with your probate needs. Whether you are seeking your own customized Estate Plan or are in need of a Probate for a loved one who has passed, we are available to discuss your options and answer your questions at an initial consultation. Call us toll free at 877.232.6101 or 208.232.6101 for a consultation with the Racine Olson team. You can also email us directly at racine@racinelaw.net. We will answer your questions and will help you solve your Idaho Estate Planning and Probate problems.