Michael B. Cohen's Latest Blogs

“Life is worth living as long as there’s a laugh in it” was stated in the book “Anne of Green Gables”. There can even be laughter at death as some of the following will provisions illustrate. There are also weird bequests some of which are provided for amusement.

Long-term care Medicaid (the government program that assists in payment of nursing home care and medication) is means-tested. The government looks at an applicant’s assets prior to obtaining eligibility for paying for long-term care. The government (Texas Health and Human Services Commission) also considers income (there is an income cap which is presently $2829 per month) and whether the applicant made any uncompensated transfers within 5 years prior to the date of the application. 

It is very common for a minor to be named as a beneficiary of a will or trust. However, since a minor is presumed to lack capacity under law until reaching the age of majority, different planning options should be considered. Even when a child reaches the age of majority (18), will the child be mature enough to astutely manage the inheritance? Generally, the answer is “no”.

Irrevocable trusts (including trusts created within a will as well as irrevocable trusts created within a revocable living trust) give guidelines to a trustee as to how distributions are to be made in accordance with your desires.  Some prefer mandatory distributions (i.e., trustee must give $1000 month for 10 years). Some prefer “wholly discretionary” trusts whereby the trustee has sole discretion to make distributions as determined solely by the trustee.  The typical wording is that “the trustee may (or shall) make distributions to the beneficiary or beneficiaries in its sole and absolute discretion”.