Importance of funding Qualified Income Trust

I was recently asked by a Nursing Home to help them with a client of theirs for the Medicaid renewal. Apparently, the client was denied Medicaid annual renewal and the benefit has been removed. The issue was the Qualified Income Trust. The client paid the attorney $7500 in order to draft the Qualified Income Trust, but the attorney completely failed to guide the family on how to properly fund the Qualified Income Trust. The attorney simply gave it to the family, without any instructions. To make matters worse, the family can not locate the Qualified Income Trust, or who the attorney was that drafted it. We do things very differently. The hard part is not the drafting; the hard part is to ma

Trump Tax Changes Implications

The recent proposed Trump tax changes have grand implications for estate planning. For starters, the proposed tax reform would eliminate the Estate Tax of 40% for estates with values greater than $5.5 million. This affects less than 1% of the total US population. However, the proposal also reduces the corporate tax from 35% to 20%, including closely held small businesses. This could potentially become a very large tax savings to many small business owners. So what should you do now? Continue with making your current estate plans. Why? Because we can not plan today for potential tax and market forces that might occur in the future. What can my estate planning attorney do now though? When we

Inherited Roth IRA

If you inherit a Roth IRA, there is a tax advantage to not liquidating the full amount. If you take only the RMD (required minimum distribution) before Dec 31 of the following year after death, then you can "stretch" out the distributions over your expected life span, thus greatly reducing any taxes. For example, a 50 year old has a life expectancy of 34.2 years, so you would divide the value of the Roth IRA, at time of death, by 34.2. That is the amount of Roth IRA that is under RMD. The remainder each year thereafter is divided by the original life expectancy minus one. As you can see, this would stretch the Roth IRA to the life span of the beneficiary, thus drastically reducing the taxes

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North Miami Beach, Florida