I don't understand "executor of a trust". As far as I know, you're either executor of will or trustee of trust.
I don't know. i'll find out more when she gets back from the funeral and stuff in a few days. Sorry for not having more info.
I don't understand "executor of a trust". As far as I know, you're either executor of will or trustee of trust.
A low income, low asset person can be "dual eligible ". That is, eligible for both Medicare and Medicaid. As you know, Medicare alone doesn't cover all expenses
The first thing your wife needs to do (if she has not done this) is to get a copy of the trust document and read it carefully. Questions include whether sheis an equal co-trustee and what power she might have to fire the lawyer that you don't trust and replace him/her with a different trustee. Also determine what/how the trust can provide money to her mother. In most trusts the trustee(s) do not control to the ham sandwich level. Possibly she (maybe even without the lawyer) can arrange for mother to get a fixed amount every month. The trust may even be a "special needs" trust which has the goal of not being an asset that disqualifies mother from government benefits. No way around it -- this stuff is complex.
If she does not get satisfaction from the lawyer; good empathy, complete and understandable explanations, etc. then she may have to consult another trusts & estates lawyer. In the extreme she may be able to go to court to have her current co-trustee replaced. A court can also change the terms of the trust but that is a heavy lift.
But the first step is understanding the trust document. She should study it carefully before meeting with the lawyer even if that means the meeting has to be postponed. You can help by doing the same studying. Then you can both have eyes that are glazed over.
+100
Unless the lawyer is named in the trust document, your wife may have most if not all of the power is she is named as primary Trustee. Pay attention to this verbiage in the Trust document.
"Writing" aka a letter from the lawyer does not control. The trust document controls. If the lawyer claims to control everything but that is not what the trust document says, fire the lawyer and report him/her to the state's professional responsibility board.She told me over the phone that the lawyer controlled everything, but I have not seen this in writing.
A low income, low asset person can be "dual eligible ". That is, eligible for both Medicare and Medicaid. As you know, Medicare alone doesn't cover all expenses
Grandpa most likely set up the trust so she would not lose her Medicaid benefits. Medicaid picks up almost all of the bills that Medicare does not. An unhealthy 70 year old can blow through $400k easily with medical bills.
I believe there is a rule that her assets cannot be greater than $2k or $2.5k. That includes a checking account. So do not fill up her checking account quarterly as it sounds like you could go over that amount. If you can, pay her bills directly from the trust. Give her some fun money to spend in her checking account.
Not really accurate about blowing the money on medical at 70..but you can blow it on lots of other stuff
She told me over the phone that the lawyer controlled everything, but I have not seen this in writing.
Lots of suggestions above. Thanks again guys! It will be another week before wife comes home and I get to see the actual documents.
@rmcelwee, since we are burying you in suggestions anyway here is one thing to hope for. In some states there is the legal idea of a "Trust Protector." This is a third party named in the trust who has the power to step in and solve problems, including firing a trustee. For our son and grandkids' trusts we have named a younger BFF of DW as Trust Protector. We like the idea a lot.
"Writing" aka a letter from the lawyer does not control. The trust document controls. If the lawyer claims to control everything but that is not what the trust document says, fire the lawyer and report him/her to the state's professional responsibility board.
This is brilliant Athena.Is Medicaid a necessity now? I'm assuming she's eligible for Medicare at age 70. Does she now have enough liquid assets to pay Medicare premiums? That may free you of the need to set up disbursements in a way that still qualifies her for Medicaid.
My wife's grandfather died. Her mother (sole heir) is horrible with money so everything was left in a trust. My wife is great with money and is the executor of the trust. We had great plans to use the money to help her mother out but it seems like this is a horrible way to accomplish it and sounds like it is fantastic way for the lawyer to drain the trust of money. Mother lives in a house owned by grandpa ($100k) and drives a car owned by grandpa ($2k). There is also another house and car. In addition, mother is on medicaid and can only get so much money (about 25K per year including 10K in SocSecurity) before getting kicked off. There is probably around $400K total in property. Mother is a very unhealthy 70 years old.
It sounds to me that every time mother wants a ham sandwich we will pay for it, submit a bill to the trust and the lawyer will give us $2 and keep $75 as a fee (I don't know for sure but I am sure it is somewhat based in fact).
I suggested my wife relinquish the title of executor (or whatever her title is) and just let mother and lawyer handle all of it. Just too much hassle. I really hate to see fees and inflation destroy the money he left. Any extra money given to mother will be completely wasted.
Wife will have another meeting with the lawyer this week and I would like to give her a list of intelligent/important questions to ask. Any suggestions?
Basketcase24 makes some very good points. #1 that assets need to be in the trust name. I am an expat with no state residency in the USA. Hence no state can administer my Will should I die regarding my US assets. My local assets are subject to the laws of the land and wills can only address a %. The answer to that was creating a trust and moving the majority of my assets into it and having the trust clearly state what should be done (like a will but not). If the assets are not in the trust you have to look at the will. Your MIL may have inherited them out right.I'm executor for my recently departed MIL, and also co-trustee with FIL. They recently set up a revocable living trust. I'm now the co-trustee with FIL. A few things I learned, which may or may not be applicable in your state or situation.
1. Co-trustees can act independently. One does not need permission from the other to distribute assets (Because I'm also the executor, I have a fiduciary responsibility to consult with FIL/co-trustee, but he would not need to consult with me.)
2. Trusts have to be set up specifically to be sheltered from being considered an asset for purposes of Medicaid.
3. Having a trust means nothing if the trust has no assets. Assets have to be titled to the trust to be subject to its protection/restrictions.
4. There may be time limits (look back window) for moving assets into a trust established to obtain/maintain Medicaid eligibility.
5. (Not specifically about trusts) Medicaid is a generic term for the state-run process. The state-specific processes differ greatly between states, so make sure you refer to the right rules.
6. An Elder law attorney is worth their weight in gold. The government also keeps a running list of attorneys that are VA certified to work with Veteran's to coordinate benefits, similar to Medicaid.
Yet, I have heard people boast about gaming Medicaid: paying lawyers to redistribute assets so as to avoid the claw back provisions, preserving big inheritances for offspring, and forcing foolhardy taxpayers to cover long term care for elderly parents.