Svete & McGee Attorneys at Law

WHAT ARE THE DIFFERENCES BETWEEN MEDICARE AND MEDICAID

Sometimes it’s easy enough to confuse Medicare and Medicaid, both of which are government programs.  Generally speaking, Medicaid is for people with lower incomes, whereas Medicare is for older folks.

Who is Eligible for Medicare?

             Medicare is for retired individuals who have attained the age of 65 that provides health insurance sponsored by the federal government.  The nice part about Medicare is that coverage is afforded to Medicare insured individuals regardless of their medical condition.

What about Medicaid?

             The federal government provides a health insurance program which is administered by state governments.  This insurance serves people that are generally in the lower income brackets and those that are either elderly, disabled, blind or parents of minor children.

What is the Eligibility Requirements for Medicare?

Anyone reaching the age of 65 is eligible for Medicare coverage.  Also, Medicare is available to disabled individuals.

What are the Eligibility Requirements for Medicaid?

             Medicaid eligibility standards are set by individual states subject to Federal guidelines.  Families with low income, qualified pregnant women, children and individuals receiving supplemental social security are persons who must be covered under this insurance.  In order to qualify, an individual has to be financially needy, which is generally determined by income and asset tests.

What will Medicare Cover?

             Medicare has two parts:  Part A, which is for hospital coverage; and, Part B, which covers medical care such as one’s doctor, lab tests and physical therapy.  Medicare insured may elect to have Medicare Advantage which enables the insured to receive health care through managed care plans, such as Health Maintenance Organization (HMOs), Preferred Provider Organization (PPOs) and Medicare Part D coverage for prescription drugs.

Why Can’t a Retiree at Age 62 Apply for Medicare?

A retired person that opts to receive Social Security at age 62 will not be eligible for Medicare until that person reaches 65 years of age.  That is why it is very important before one decides when to enroll for Social Security that they take into consideration the Medicare coverage issue.

PERSONAL INJURY CLAIMS – AVOID DELAY:

The Downside of Delaying Treatment and/or Providing Insurance Company Information Too Soon

Although each case is different, there are two almost universal mistakes that unrepresented injury victims often make in handling their own personal injury claims.  The first mistake is to “tough it out” and see if aches, sprains and strains “go away” before being seen by EMS, the ER or their own treating physician.  Aside from that fact that this delay may endanger your health, most insurance companies will intractably conclude that “No Treatment Means No Injury” regardless of later presented facts or diagnosis to the contrary.   Stoically denying or minimizing any aches and pains is another sure way to play into an insurance company’s desire to deny or minimize your injury.

Even if you are not sure if you were injured or it turns out that, in fact, you were not injured, no legitimate insurance company will question your right to be transported, seen in the ER and follow up with your own doctor.  Even without an injury claim, “Med-Pay” is usually available to cover such initial treatment or evaluation.

A slightly different angle on the same theme is the danger of giving the insurance company a statement denying or minimizing any injury and/or signing authorizations for the release of your medical records too soon.  While you may be fortunate enough to have sustained no injury or merely a short term “soft tissue injury”, it is equally possible that these sort of symptoms may have a “delayed onset”, become “chronic” (fail to go away), get worse, or even develop into more serious neurological injuries requiring, in some instances, increasingly invasive procedures, surgery and disability.

Providing insurance companies with access to your medical records too soon, and while the ER and your own doctor are initially hopeful that your injury, if any, is short term, often results in the insurance company leaping, prematurely, to the assumption that they also hoped for, i.e., “not injured” or “short term soft tissue injury with good prognosis to be fully resolved”.  One would like to believe that if the situation legitimately changes for the worse as time and treatment progress, that the insurance company will, accordingly, adjust their initial assessment of your claim.  The problem, however, is that insurance companies often have a hierarchical, institutional or bureaucratic process that requires the claims adjuster to “set a reserve”, an initial likely value of the claim, as soon as possible.  This “reserve” can later become almost “set in stone” regardless of how the facts develop.  Insurance company managing supervisors can become quite aggressive with their own claims adjusters in resisting any later upward adjustment of the initial “reserve”.

While it can be quite difficult for the injured party to keep these things from happening, most competent attorneys who been retained early enough to represent you in such claims can get the insurance company “off your back” and prevent such tactics that are often institutionally meant to deny or minimize your injury claim.

WHAT TO DO WITH AN INHERITED IRA

Owners of Traditional IRA’s must start taking Required Minimum Distributions when they turn 70 ½ years of age. When a person, other than a spouse, inherits an IRA, they must start RMD (Required Minimum Distribution) the year following the year the owner died. The persons inheriting will have to pay tax on distributions of deductible contributions and earnings from a traditional IRA. Not taking an RMD results in a 50% penalty on the amount that should have been withdrawn for the year. However, you may avoid the penalty if you miss an RMD by emptying the account within five years of the owner’s death. This depends on the size of the IRA and age of the beneficiary. In some instances, it may be smarter to pay the penalty than to withdraw the money from the IRA account. Also important is that if the owner of the IRA died before starting the RMD’s but had not taken the RMD for the year in which he or she died, that RMD must be withdrawn from the account. There is a different requirement for Roth IRA’s. The owners never have to take RMD’s, however, non spouse beneficiaries must take RMD’s. The good thing is that the withdrawals from inherited Roth IRA are still tax free.

Another caveat is that non-spouse beneficiaries cannot roll an inherited IRA into their own IRA. In those instances, a separate account should be created.

Finally, when there’s more than one beneficiary of the IRA, it’s important that they split the IRA among the beneficiaries to take advantage of the beneficiaries individually ages. If not, the age of the oldest beneficiary will be used to calculate the RMD’s now which generally will shorten the number of years the money can grow tax deferred.

When the situation arises, it is advisable that you consult with either your attorney, your tax accountant or financial planner to insure that the maximum benefits can be derived from an inherited IRA.

TAX PLANNING NECESSITIES

Ohio has eliminated the Estate Tax; and the Federal Government has increased the Estate Tax Credit to $5,430,000 per person with spousal portability which has made Estate Planning for tax purposes less relevant.

However, there are other very important reasons why Estate Planning is very important.

Clients with young children need to be concerned about the future of their children in the event of their untimely death. A typical Will will designate who should physically care for the minor children following the death of a parent. In the event of the death of only one parent, the survivor is automatically the custodial parent. However, in the event of the death of both parents, consideration must be given as to who will be in charge of the minor child’s assets. And who will be responsible for the care of the minor children. Normally, the same person can be designated as both the Guardian of the Estate as well as the Guardian of the person of the children. In some instances, however, it is advisable to separate the responsibilities. An example would be where the person designated as the Guardian of the person of the children may not be financially responsible and in that instance, another person should be named as the Guardian of the estate of the children. The Guardianship terminates upon the children reaching their 18th birthday. Whatever funds are remaining, automatically becomes the children’s’ funds. This may not be a desirable effect, particularly if there are substantial assets involved.

THE NEED FOR A TRUST.

In situations where there may be sizeable assets but well below the Federal exemption, the Trust is ideal for those who want to insure that the minor child’s assets will be held and protected for the benefit of the child until the child reaches a suitable age. Also, a Trust may be used to create a family legacy to control the disposition of the assets within the family blood line.

Another planning tool with a Trust is that the assets left in trust for the benefit of the children can be protected from creditors and the child’s spouse, in the event of a divorce. Likewise, the funds can be controlled by the Trustee to avoid the child from frivolously spending and wasting their inheritance.

Another important factor is that by having one’s assets in a Trust, avoids Probate. This is normally an extended process but it can be costly and time consuming. Unlike with a Trust, any assets inherited by the heirs through probate become the assets of the Beneficiary without any protection as afforded by a Trust.

SECOND MARRIAGES.

With a Trust, in the event of a second marriage where there may be children from prior marriages, careful planning needs to be thought out and agreed upon by other partners of the second marriage. This can be accomplished more smoothly and clearly by use of Trusts. More specific assets can be designated for specific beneficiaries with proviso and contingencies in the event of one of the partner’s premature death to provide that partner’s children from a prior marriage.

IN EVENT OF DISABILITY.

With a Trust, in the event of mental incapacity, the Trustee is able to provide and manage the disabled person’s financial affairs and the person’s business interests without the necessity of appointment of a Guardian. Normally, in the event of a person’s disability where the person is unable to manage his or her finances, a guardianship will generally be required. This is an expensive and time consuming process requiring annual reports to be filed with the Probate Court. With a Trust, this process can be eliminated.

If you need further information or advice regarding your Estate Plan, please feel free to call, Joseph T. Svete at 440-286-9571.

 

Why Do I Need A Trust?

Joseph T. Svete, Esq.

In the past, a Trust was an essential estate planning tool for purposes of tax saving and controlling one’s assets after death.

With the generous Federal exemption currently at $5,430,000 and the elimination of the Ohio Estate Tax, for most of us, tax planning is not as critical as it once was. However, for estate planning purposes, Trusts are still a very important planning tool. Some Trust advantages include the following:

Trusts are not a public record and do not have to be filed with the Probate Court upon one’s death, therefore the person’s estate can remain private and confidential.

Unlike a will, where at the termination of the Probate process, the decedent’s assets are distributed with no further direction or control from the decedent. However, with a Trust, the Grantor can determine not only at what ages the beneficiaries should receive Trust assets as well as providing for a child with special needs.

Also, a Trust may protect a beneficiary’s assets from creditors as well as a spouse in the event of divorce. Distributions from a Trust, when they are distributed in the sole discretion of the Trustee and the Trust contains a spendthrift provision, the creditors of the beneficiary will not be able to cause a distribution to the beneficiary for possible attachment by the creditor.

As you can see, a Trust is still a very important estate planning document notwithstanding the fact that tax issues for most of us are no longer a consideration.

How a Client Can Help His Own Case

1.) First and foremost, you must be truthful and give all information needed to your attorney to handle your legal case. This may be difficult if you believe certain facts may hurt your case, however, hiding these facts most often will hurt your case in the end. If your lawyer knows all the facts up front, your lawyer will have time to deal with them.

2.) It is also important that you fully cooperate with your lawyer by responding in time to your lawyer’s request for information and tell your lawyer of changes in your situation.

3.) Punctuality for meetings and legal proceedings is cost saving and respectful to the judicial system. Being late for Court can result in penalties or delays.

4.) Be respectful at all times by dressing appropriately for legal meetings and Court appearances and being polite to the Court’s staff.

5.) Communicate with your lawyer. Discuss with your lawyer your beliefs, concerns and questions. Do not assume your lawyer knows or should know when you have concerns or questions. Regular contact between you and your lawyer greatly improves your lawyer/client relationship.

 

Neighbor Disputes

One of the most stressful and ongoing situations that anyone can face is a difficult and contentious neighbor. Even in the best of circumstances, any escalation of conflict with this sort of neighbor inevitably makes a bad situation only worse. When called or petitioned to intervene, both the Police and the Courts will often, and understandably, take the attitude of “Why can’t you …. just get along?!?!” and simply treat both sides as being unreasonable or at fault.

Truly effective remedies can be very difficult to obtain from either the Police, who are limited to enforcement of criminal laws only, or the Courts which are limited to compensation of “actual” damages that can be quickly eclipsed by the cost and delay of obtaining judicial relief. So what can you do? If all reasonable efforts to resolve ongoing neighbor problems have failed, there are some important guidelines to follow.

First and foremost, never lose your cool. Never respond in kind, whether verbal or physical, to the uncivil or inappropriate conduct of a neighbor. “Tit for Tat” or an “Eye for an Eye” will, most likely, just land you in jail. Try to stay on your side of the property line and, if at all possible, retreat from any physical aggression or attack and call the Police.

Next, step back from the situation and instead, document the dispute. Rather than engaging in a shouting match, send a letter (and retain a copy), registered or certified and reasonably set forth the problem and your willingness to resolve it in a civil and reasonable manner. If your neighbor is physically coming upon (trespass), or vandalizing your property, consider motion triggered outdoor lighting. If need be, camouflaged and motion triggered game cameras can document these intrusions. Some of these game cameras will take videos and even transmit the video via wifi so that even destroying the camera is safely documented. If the behavior is more in the form of nuisance (phone calls, loud music and/or parties, verbally abusive language, revving engines, etc.) a simple video camera with microphone and date/time stamp will do.

Before you get to the point of documenting such trespass, vandalism or nuisance, it is always best to call the Police and ask them to tell your neighbor, and document that they have told your neighbor to stop such behavior. The Police will be much more likely to intervene and charge your neighbor with a criminal offense if they have previously told them to “cease and desist”.   In fact, a “civil” trespass becomes a “criminal” trespass (Ohio Revised Code § 2911.21) when it can be proved that one knew he had no right, or had been notified not to be on the property. “Criminal” telephone harassment (Ohio Revised Code § 2917.21) includes phone calls made after someone has “previously … told the caller not to make” such phone calls. “Criminal” disorderly conduct (Ohio Revised Code § 2917.11) becomes a more serious offence when “The offender persists in disorderly conduct after reasonable warning or request to desist”.

If the Police are unable to help or advise you that “this is a civil matter”, you may have no recourse but to consult an attorney to explore whether there are practical civil court remedies. Often, however, a simple letter from an attorney warning your neighbor that he is likely to face a lawsuit if he persists may be enough. Civil remedies can be in the form of “legal” remedies (money damages) or “equitable” remedies (injunctions ordering someone to stop doing something) but require lawsuits, court fees and attorney fees.

Dave McGee

This essay merely attempts to provide general information and guidance and cannot hope to speak to all or unique facts and situations. For more specific advice, contact an attorney at our offices to discuss your unique situation.

Beware of Pitfalls of Inherited IRA’s

Generally, withdrawals from an IRA may be made at age 59 1/2 and mandatory withdrawals (RMD) must begin at age 70 1/2 (RMD). More pitfalls arise with inherited IRA’s, for example:

  • If you inherit an IRA from anyone other than your husband/wife, you cannot roll it over into your own IRA. Instead, you have to retitle the IRA so it is clear that the owner died and you were the beneficiary.
  • Also, if you move the account to a new IRA custodian, be sure you do a “Trustee to Trustee Transfer.” However, if the check is made out to you and you are not the surviving spouse, the IRS will consider this “a total distribution” subject to tax, effectively ending the IRA.
  • The withdrawal from an inherited IRA must be taken on or before December 31st of the year following the year of the owner’s death.

It is important that you consider as paying the distribution across your life expectancy. This is particularly important if you have many more years to live. That way the IRA account can increase in value while taxes are deferred.

Fortunately with Roth IRA’s, there are no required minimum distributions. However, heirs to Roth IRA accounts are required every year to withdraw minimum amounts, specified by IRS or pay a 50% penalty. Fortunately, there’s no tax due on those required withdrawals of the Roth IRAs.

If you have additional questions, please contact your IRA custodian, accountant or us.

Joe Svete

Trust Checking Accounts

joepulpitpicwebMost banks have difficulty in either understanding or implementing the right of the Trustee of a Revocable Trust to allow the spouse, who is not a Co-Trustee, but an Alternate Trustee to be added as an additional signatore on the Trustee’s checking account.  In most cases, I have had to deal with the bank’s legal department before they would authorize an additional signer on the Trust checking account.

From Joe

As part of the estate planning process you must consider what documents are necessary to complete your estate plan to ensure that your wishes are carried out. The following documents should be accessible to your spouse and/or your children in the event of death.

  1. Your will.
  2. Your trust, if it is part of your estate plan.
  3. An inventory of all your assets.
  4. General Durable Power of Attorney.
  5. Health Care Power of Attorney.
  6. Life Insurance policies.
  7. Pension or other retirement programs such as 401K’s and IRA’s.
  8. Any directive relating to memorial services, burial and/or cremation.

joepic

 

In this way your spouse and/or children will be helped immensely in administering your estate upon your death. Please feel free to call us with any estate planning and or/probate questions. We can be reached at 440-286-9571 or svete@smc-law.com

-Joe Svete

Highly Rated Ethical Standards and Professional Legal Ability

Svete & McGee Co., LPA 100 Parker Court, Chardon, Ohio 44024-1141 Map
Tel: 440-286-9571  Fax: 440-286-7504  Email