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Debt Collection: Being held liable for another’s debt

Debt Collection: Being held liable for another’s debt
A spouse can be held liable for the other’s medical bills if the following factors apply:
1) the patient spouse is unable to pay
2) the non-patient spouse is able to pay
If the above factors are shown, the non-patient spouse may be held liable for the patient spouse’s medical bills unless the non-patient spouse has been abandoned by the other spouse without cause.
I usually get asked about this subject in an estate planning context.  Once one spouse passes away,  it is rare for the creditor to collect and here is why:  In Ohio, the creditor’s claim must be made against the decedent’s estate within 6 months of the death.  If the creditor does not assert its claim within 6 months, the creditor’s claim is barred.  Once the claim is barred, the above rule applies.
If you are a surviving spouse finding yourself in the above situation, you should speak to an attorney.  You have a few options.  1) You can claim that you cannot pay, especially now that you have to pay for the cost of burying your spouse.  2) You could also claim that the patient spouse abandoned you without cause.  To determine if either of these arguments might work for you, you should seek the help of counsel to build your case.
Even with the above caviat, it is safe to tell clients that as a general rule, they will not be held liable for the debt’s of their spouse.  It is always important to seek the advice of an attorney if you find yourself in a situation where people are claiming that you are liable for another’s debt.  Creditors (and others) like to tell family members that they will be held liable, in an effort to collect.  Just because a creditor tells you this, it does not make it true.  Always seek the advice of a local attorney to address your specific situation.

Planning for long term care continued…

Planning for long term care continued…

There are many tools that can be used to prepare for long term care: trusts, insurance, TODs, and gift transfers during a lifetime; however, you must choose the right tools for your specific situation and you must make sure those tools are prepared correctly or you may find yourself paying criminal consequences.  Currently, the medicare lookback period is 5 years; however, it is likely the government will extend it to 7 or 8 years in the near future.
From my experience, financial planners tend to encourage clients to create trusts to avoid medicare rules.  This can be great advice in certain situations; however, the client must keep in mind that if s/he would like to create a trust to avoid medicare, it must be an irrevocable trust and the trustee must be someone that is not a relative.  Essentially, the government requires that the client give up all control over his/her assets.  Many people, (especially those with significant assets) will not give up all control over the estate they spent their entire life building.  In some cases, they can’t afford to give up all control because they need to have access to the assets in the event that something happens.
Insurance is a decent option.  There does exist a particular type of insurance that will protect your assets in the event that you go into a nursing home.  For instance, if you purchase the coverage for $200,000, the plan will allow you to keep $200,000 in assets (meaning that you have to spend down any assets above that) and then it will cover all other costs of long term care.  This is a great option if you want to be able to maintain control over your assets.  Obviously, the cost will be the monthly premium.  If this is an option you are interested in exploring, please speak to your financial advisor.  If you don’t have one, I would be happy to refer you to one.
Another great way to reduce assets for long term care planning is to give away assets.  If you have family members that you trust, you can deed real estate to them, open bank accounts in their names, and make gifts of up to $13,000 per year (without tax conseqneces).  I am always hesitant to recommend that my clients do this.  If you give something away, you must realize that you are doing just that: giving it away.  Once you give away an asset, you must expect that the person will treat it as their own.  If they comply with your wishes then that is great but you should always expect that they won’t follow your wishes because legally, they don’t have to.  People have a difficult time controlling themselves when money is involved.
No matter which tools you decide to use in order to adequately plan for long term care, you must make sure that your financial advisor and your attorney communicate and work well together.  Neither will be able to adequately advise you if each is not aware of what the other is doing.

Planning for long term care

Planning for long term care
As the baby boomer generation gets older, there is going to be an increased need for attorneys that specifically work in the area of estate planning for long term care.  If you or a loved one is getting to the age of 55 or older, it is time to start seriously considering an exit strategy. There are several questions you need to ask yourself:

1) Are you prepared in the event you need long term care?

2) Are you prepared in the event your spouse needs long term care? (Keeping in mind that medical facilities and nursing homes can come after you for the medical bills of your spouse- see blog posting from September 2, 2011.)

3) Do you have a succession plan for your business?

4) Will members of your family have the ability to pay off the family owned business if something were to happen to you?

5) If you don’t have a spouse, children, parents, siblings, or grandparents that are still alive, do you have a will in place that specifies who will be the executor and beneficiary of your estate?

6) Even if you do have the above family members, do you wish your estate to pass in a way different from the laws of intestacy? If so, do you have a will?

If you are unsure about the answers to any of these questions, or if you answered “no” to any of the above questions, I would be happy to discuss your specific needs in a free consultation.

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Top 10 Videos of 2016, #6: Estate Planning 101

Top 10 Videos of 2016, #6: Estate Planning 101

Daryle C. Tibbs, owner of Tibbs Law Office, continues a new series dedicated to the Top 10 videos of 2016.

For more online sources on this and similar topics, please visit our firm YouTube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com

Estate Planning Revisited: Estate Planning 101

Estate Planning Revisited: Estate Planning 101

Daryle C. Tibbs, owner of Tibbs Law Office, explains the basics of Estate Planning, beginning with naming the key people that you need to identify when arranging your estate plans.

For more online sources on this and similar topics, please visit our firm youtube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com

 

Estate Planning Law 101: How To Select Trustees For My Estate Plan

Estate Planning Law 101: Selecting Trustees

Daryle C. Tibbs, owner of Tibbs Law Office finishes discussing the basics of Estate Planning by explaining how to name Trustees for your estate plan.

For more online sources on this and similar topics, please visit our firm youtube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com

Estate Planning Law 101: Selecting An Attorney In Fact

Estate Planning Law 101: Selecting An Attorney In Fact

Daryle C. Tibbs, owner of Tibbs Law Office continues discussing the basics of Estate Planning by explaining how to name an Attorney In Fact for your estate plan.

For more online sources on this and similar topics, please visit our firm youtube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com

 

Estate Planning Law 101: Selecting A Health Care Agent

Estate Planning Law 101: Selecting A Health Care Agent

Daryle C. Tibbs, owner of Tibbs Law Office continues discussing the basics of Estate Planning by explaining how to name a health care agent in your estate plan.

For more online sources on this and similar topics, please visit our firm youtube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com

Estate Planning Law 101: Naming An Executor Of The Estate

Estate Planning Law 101: Naming An Executor Of The Estate

Daryle C. Tibbs, owner of Tibbs Law Office continues discussing the basics of Estate Planning by explaining how to name an executor in your estate plan.

For more online sources on this and similar topics, please visit our firm youtube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com

Estate Planning Law 101: Guardian Of Minor Children

Estate Planning Law 101: Guardian Of Minor Children

Daryle C. Tibbs, owner of Tibbs Law Office, continues to discuss the basics of estate planning by explaining how naming a guardian for minor children should be handled in an estate plan.

For more online sources on this and similar topics, please visit our firm youtube channel at:

www.youtube.com/tibbslawoffice

www.youtube.com/tibbslawofficeKentucky

Tibbs Law Office, LLC
1329 East Kemper Rd. #4230
Cincinnati, OH 45246
(513) 793-7544
www.tibbslawoffice.com