Alternative Goals of Estate Planning

Timothy Lambrecht

When you think about creating an initial estate plan, you likely focus entirely on the need to create a roadmap for the distribution of your estate assets in the event of your death. While that certainly will always remain an important estate planning goal, you will undoubtedly include additional goals into your estate plan over time.  The following subjects should be at the forefront of your mind, depending on your own unique personal situation.   

Incapacity Planning  

    People typically associate the possibility of becoming incapacitated with old age, specifically with Alzheimer’s and other age-related dementia conditions. While Alzheimer’s is a leading cause of incapacity in elderly individuals, the reality is that you could suffer a period of incapacity at any age as a result of a tragic accident or debilitating illness. If that happens, who will take over control of your assets? Who will make health care decisions for you? In the absence of an incapacity planning component in your estate plan, a judge may be forced to answer those questions – and you may not like the answers.  Putting a power of attorney and health care proxy into place will allow you to appoint your own agent to act in your best interests in the event of incapacity.  

Probate Avoidance  

    Probate is the legal process that is required after the death of an individual. The primary purpose of probate is to identify, value, and eventually transfer the decedent’s assets to the intended beneficiaries and/or heirs of the estate. If the estate is required to go through formal probate, it can take months, even years, to get through the process. In addition, a lengthy probate can be costly, diminishing the value of the estate that is ultimately passed down to loved ones. Probate avoidance tools and strategies can help your estate avoid the need for formal probate.  The most common tool for probate avoidance is a Revocable Trust, otherwise known as a Living Trust.  By working with an attorney to establish a Revocable Trust and placing your assets in the trust, every asset that goes into the trust will avoid the probate process.  

Planning for Parents with Minor Children or Children with Special Needs  

    If you are the parent of a minor child, you undoubtedly want to make sure your child is provided for if something happens to you. Your minor child, however, cannot inherit directly from your estate. Simply leaving assets for your child in your will doesn’t ensure that your child will be well cared for in your absence. Instead, most parents establish a trust to protect their child’s inheritance until the child reaches an age where the child is more mature. As the creator of the trust, you appoint someone as the trustee to manage and invest the trust assets while your child is a minor. That same trust can then be used to stagger disbursements once your child becomes an adult, allowing your child to learn how to manage his/her inheritance before receiving it all.   

    In the event there are children with special needs that will inherit, a particular trust called a Supplemental (or Special) Needs Trust would need to be established.  The Supplemental Needs Trust allows the child to have the benefit of their share of the parent’s estate, but not have any risk of losing any public benefits that may be subject to assets tests, like Supplemental Security Income (SSI) or Medicaid.  

Long-Term Care Planning  

    Long before you reach retirement age, you should start thinking about the possibility that you, or a spouse, will need long-term care (“LTC”). Specifically, you need to plan for the high cost of that care. With a nationwide average of over $100,000 per year for 2020, most people cannot afford to pay for LTC out of pocket – and Medicare will not cover LTC expenses. Medicaid can help with those expenses, but you must first qualify for Medicaid benefits. Medicaid uses both an income and an asset test that could be problematic if you failed to include Medicaid Planning in your estate plan well ahead of the time you need to qualify.  An experienced estate planning attorney will be able to guide you through the process of establishing certain trusts that can help protect your assets from Medicaid.  

    Reaching out to an experienced estate planning attorney is the first step in helping you accomplish your estate planning goals.  The sooner the process is started, the sooner you can rest assured that you and your family are taken care of. 

Timothy J. Lambrecht primarily focuses his practice on complex civil litigation, environmental law, and municipal law matters. Mr. Lambrecht is an experienced environmental law practitioner and litigator. If you would like legal assistance in an environmental case contact Attorney Lambrecht of the Wladis Law Firm at tlambrecht@wladislawfirm.com

Do You Need An Environmental Lawyer?

Kevin Murphy

If you are buying or selling real estate you may need to hire an environmental lawyer.  

    If the answer is yes then you may need environmental counsel when any of the following arise:  

  • You want to obtain “bona fide prospective purchaser protection” for your property acquisition but are not sure what is required. You need assistance in drafting environmental provisions in a contract of sale in order to protect yourself from risk and future liabilities.
  • The parties to a commercial real estate deal cannot figure out a fair method for allocating the costs to clean up environmental contamination and need creative, workable solutions.
  • “Everyone knows” the property is contaminated because of a leaking tank or an asbestos problem, but no one knows what to do. The lender tells you a Phase I environmental site assessment needs to be prepared, but you know you shouldn’t rely on a Google search to find a qualified environmental consultant.
  • The Phase I Environmental Site Assessment report tells you there are “recognized environmental conditions,” and you do not know how to proceed or if you should proceed.
  • A Phase II Environmental Site Assessment confirms the presence of contamination and you do not know how to proceed or if you are required to report the findings to anyone.
  • You do not know whether environmental insurance is available to resolve some of the difficult problems in the deal.

You need an environmental attorney when you or your client wants to know:  

  • Whether and how the development of the property could meet the requirements of the New York State Brownfields Cleanup Program.
  • How to get the best estimates of the costs of, and how to evaluate the adequacy of, proposals to clean up the property.
  • Whether there is a potential claim against the prior owner for failure to disclose an environmental liability that he knew or should have known about and should have disclosed to the client/purchaser.
  • If there is a viable claim against prior owners in the chain of title.
  • Whether there is a potential claim against an adjacent property owner for contamination on the property that the client now owns. What the scope of your liability is for property damage and personal injury to nearby properties from contamination migrating from your property before and after purchase.
  • If completion of a Phase I ESA is all that needs to be done to obtain “bona fide prospective purchaser” protection.
  • How to get a “no further action” letter from a government agency to meet a lender’s requirements.
  • What the impact of contamination is on the value to your property.
  • Whether, even after cleanup, there is an actionable “stigma” attached to the property.

The Basics of Special Needs Trusts

Timothy Doolittle

Special Needs Trusts (“SNTs”) are an essential tool both when a person with disabilities has assets to protect and when that person’s parents are considering their estate plan. Whether the person with the disability has funds, receives funds from a personal injury settlement, or receives funds and property as a gift, the money must be managed carefully. SNTs (or Supplemental Needs Trusts as they can be referred to) are the best tool to use for asset protection for those with disabilities. 

    The primary goal of an SNT is to preserve a disabled person’s access to needs based public benefits when receiving a lump sum or inheritance. These benefits might otherwise be lost when the individual acquires resources over a given threshold. A person who is disabled may be receiving Supplemental Security Income (“SSI”) on a monthly basis and may have Medicaid coverage to pay for the costs of healthcare. Medicaid and SSI are means-tested and impose limits on resources, so an influx of money from an injury settlement or inheritance could result in a loss of benefits access. 

    An SNT makes it possible to avoid this loss of benefits. When properly drafted in accordance with the law and when properly structured and maintained, SNTs allow money to be used for the benefit of someone who is disabled without jeopardizing benefits access. The assets held in the trust are not counted as resources for Medicaid or SSI calculations but can be used to supplement and enrich the quality of life of the person who is disabled, beyond what governmental benefits provide for. When SNTs are created, it is important to know what specific type of trust must be used. There are two primary kinds of SNTs: first-party trusts and third-party trusts. The unique situation of each person will dictate which type of trust will need to be created. 

    If the money or property being put into the trust comes from the person who is disabled, the trust is a first-party trust. This situation can occur if the individual receives a windfall inheritance, receives a personal injury settlement, or if they simply have built up assets based on gifts from family members. A third-party trust can hold assets that are deposited in the trust directly by any third-party source, like a grandparent, parent, aunt, uncle, neighbor, etc. 

    A first-party special needs trust can be established only by the disabled individual, parent, grandparent, guardian or court. They also can only be established for someone under the age of 65. In some situations, courts would monitor these trusts. The main drawback of a first party SNT occurs when the individual with a disability dies. At that point, the SNT must contain terms that names the state providing Medicaid benefits to the individual as the primary beneficiary of the SNT’s assets. This is known as the “Pay-Back” provision, to allow the state to pursue reimbursement for the costs of care expended during the individual’s life. 

    A third-party SNT can be created by anyone who wants to leave money to someone who is disabled. Third-party SNTs can be funded up to any amount, with any type of asset. The trust can be used for virtually any purposes to benefit the person with special needs, except for that the person’s own money cannot be held in the trust. Often times, parents of a child with disabilities will set up a third-party trust as part of their estate plan, to ensure any inheritance meant for the child will not affect their public benefits. 

    Upon the death of the disabled beneficiary of the third-party special needs trust, the money and property can transfer to any other relatives or beneficiaries that the trust creator chooses. Because the money and assets in the trust never belonged to the person who was disabled, the state has no ability to require a pay-back provision. 

    Special Needs Trusts can provide very important protections for someone with disabilities. If you are in a situation that calls for a Special Needs Trust, reaching out to a qualified attorney well versed in the area is a must. 

Timothy Doolittle primarily focuses his practice on estate planning, as well as asset preservation for individuals. Mr. Doolittle is a magna cum laude graduate of the State University of New York at Buffalo, Honors College. Mr. Doolittle is admitted to practice in New York State and is a member of the New York State Bar Association. Contact Mr. Doolittle by emailing TDoolittle@WladisLawFirm.com.

Lead-Based Paint: Notice requirements imposed by Federal law

Kevin Murphy

In 1978 the federal government banned consumer uses of lead-based paint, thus effectively stopping the use of lead-based paint in all housing across the country. Prior to that date, lead-based paint was widely used including in housing and homes constructed prior to that date.  If properly managed lead-based paint poses little, if any risk to human health. If allowed to deteriorate (peeling, chipping, chalking, cracking, damaged, or damp), lead-based paint is a potential hazard. It can cause serious health problems, especially to children and pregnant women. 

Homebuyers 

    Federal law requires that before being obligated under a contract to buy housing built prior to 1978, buyers must receive the following from the seller:  

  • An EPA-approved information pamphlet on identifying and controlling lead-based paint hazards titled Protect Your FamilyFromLead In Your Home.  
  • Any known information concerning the presence of lead-based paint or lead-based paint hazards in the home or building.
  • For multi-unit buildings, this requirement includes records and reports concerning common areas and other units when such information was obtained as a result of a building-wide evaluation.
  • An attachment to the contract, or language inserted in the contract, that includes a “Lead Warning Statement” and confirms that the seller has complied with all notification requirements.
  • A 10-day period to conduct a paint inspection or risk assessment for lead-based paint or lead-based paint hazards. Parties may mutually agree, in writing, to lengthen or shorten the time period for inspection. Homebuyers may waive this inspection opportunity. If you have a concern about possible lead-based paint, you may secure a lead inspection from a certified inspector before buying. 

Renters 

    Federal law requires that before signing a lease for housing built before 1978, renters must receive the following from your landlord:  

  • An EPA-approved information pamphlet on identifying and controlling lead-based paint hazards, Protect Your FamilyFromLead In Your Home. 
  • Any known information concerning the presence of lead-based paint or lead-based paint hazards in • For multi-unit buildings, this requirement includes records and reports concerning common areas and other units when such information was obtained as a result of a building-wide evaluation. 
  • An attachment to the contract, or language inserted in the contract, that includes a “Lead Warning Statement” and confirms that the landlord has complied with all notification requirements.

Property Managers and Landlords 

    As owners, landlords, agents, and managers of rental property, you play an important role in protecting the health of your tenants and their children. Buildings built before 1978 are much more likely to have lead-based paint. Federal law requires you to provide certain important information about lead paint before a prospective renter is obligated under lease to rent from you. 

Landlords must give prospective tenants of buildings built before 1978: 

  • An EPA-approved information pamphlet on identifying and controlling lead-based paint hazards, Protect Your FamilyFromLead In Your Home.  
  • Any known information concerning lead-based paint or lead-based paint hazards pertaining to the building. 
  • For multi-unit buildings this requirement includes records and reports concerning common areas and other units when such information was obtained as a result of a building-wide evaluation. 
  • A lead disclosure attachment to the lease, or language inserted in the lease, that includes a “Lead Warning Statement” and confirms that you have complied with all notification requirements. 

Real Estate Agents and Home Sellers 

    As real estate agents and home sellers, you play an important role in protecting the health of families purchasing and moving into your home. Buildings built before 1978 are much more likely to have lead-based paint. Federal law requires you to provide certain important information about lead paint before a prospective buyer is obligated under a contract to purchase your home. 

Real estate agents must:  

  • Inform the seller of his or her obligations under the Real Estate Notification and Disclosure Rule. In addition, the agent is responsible if the seller or lessor fails to comply; unless the failure involves specific lead-based paint or lead-based paint hazard information that the seller or lessor did not disclose to the agent. Read the regulations that includes these requirements. 
  • Provide, as part of the contract process, an EPA-approved information pamphlet on identifying and controlling lead-based paint hazards titled Protect Your FamilyFromLead In Your Home. Attach to contract, or insert language in the contract, a “Lead Warning Statement” and confirmation that you have complied with all notification requirements. 
  • Provide a 10-day period to conduct a paint inspection or risk assessment for lead-based paint or lead-based paint hazards. Parties may mutually agree, in writing, to lengthen or shorten the time period for inspection. Homebuyers may waive this inspection opportunity. 
  • A copy of the pamphlet Protect Your FamilyFromLead In Your Home is available at: 

https://www.epa.gov/sites/production/files/2017-06/documents/pyf_color_landscape_format_2017_508.pdf 

Kevin C. Murphy is a member of the Wladis Law Firm, P.C., located in Watertown and Syracuse. He concentrates his practice in the areas of environmental compliance and litigation; environmental and white-collar criminal defense, and complex litigation matters. Contact Mr. Murphy by emailing KMurphy@WladisLawFirm.com.

ReEnergy chief warns biomass plant could close in 90 days

A load of wood chips is unloaded in 2012 at ReEnergy Lyonsdale’s cogeneration plant on Marmon Road in the town of Lyonsdale. Watertown Daily Times photo.

A load of wood chips is unloaded in 2012 at ReEnergy Lyonsdale’s cogeneration plant on Marmon Road in the town of Lyonsdale. Watertown Daily Times photo.

LYONS FALLS — Without a power purchase agreement, the ReEnergy Lyonsdale wood-chip-burning cogeneration plant could close in 60 to 90 days, according to company CEO Larry D. Richardson. [Read more…]

Firm grows ties to region

Wladis Law Firm founding attorney and president Mark N. Wladis and Leann I. West, government relations specialist. The East Syracuse-based Wladis Law Firm recently opened an office in downtown Watertown. Justin Sorensen/ NNY Business

Wladis Law Firm founding attorney and president Mark N. Wladis and Leann I. West, government relations specialist. The East Syracuse-based Wladis Law Firm recently opened an office in downtown Watertown. Justin Sorensen/ NNY Business

CNY-based Wladis Law Firm opens office in north country [Read more…]