Q: My husband and I did Last Will & Testaments when our children were young – probably about 20 years ago. Is there any need to update?
A: In our practice, we see a lot of Last Will & Testaments that were executed when a couple was younger that were appropriate when drafted but outdated. Your Last Will & Testament probably leaves everything to each other and then to your children. This is referred to as a “Sweetheart Will.” While this was appropriate when you were younger, it is not the best estate plan for you and your husband now. As you get older, there is more of a need to do additional planning in order to protect your assets in the event that you or your husband require long term care, either at home or in a nursing facility.
If there comes a time when you or your husband require care, you may be able to rely on Medicaid to pay for some or all of the care. In order to qualify for Medicaid, you must meet certain asset and income requirements. There is planning you can do within your Last Will & Testament in order to protect assets. One provision that should be incorporated into your new Last Will & Testament is a trigger “Supplemental Needs Trust.” This is a trust for the benefit of a beneficiary who is disabled in order to preserve their inheritance so that the disabled beneficiary can continue to receive their Medicaid or SSI benefits. The trustee can use the trust assets to provide for the needs of the beneficiary which will supplement, but not supplant their government benefits. This is crucial if one spouse is receiving government benefits when the other spouse passes away. You do not want all of the assets going to the surviving spouse outright as it would disqualify your spouse for the benefits. If a spouse inherits assets in a Supplemental Needs Trust, they will not become ineligible as a result of that inheritance. Having the trigger Supplemental Needs Trust is important for your surviving spouse or any of your beneficiaries that may rely on government benefits.
While your current Last Will & Testaments are valid, having a “Sweetheart Will” will leave your assets vulnerable. Meeting with an attorney that specializes in Elder Law to review your current documents is crucial to asset protection.
Nancy Burner, Esq. and Brittni Sullivan, Esq. are attorneys at Burner Prudenti Law, P.C. focusing their practice areas on Estate Planning, Elder Law and Trusts and Estates. Burner Prudenti Law, P.C. serves clients from New York City to the east end of Long Island with offices located in East Setauket, Westhampton Beach, Manhattan and East Hampton.