Wills are legal documents that directs how our property will be distributed when we die. Will can also create trusts for the benefit or our spouse or children. Your will allows you to name a person you trust- your "personal representative- to oversee the management and distribution of your assets. Your will also allows you to appoint a guardian to care for your minor children. If you die without a will in Minnesota, your assets will be distributed according to a statutory formula spelled out in the Minnesota Statutes. For many of us, this statutory formula does not match with the way we would have liked our assets to be distributed. Also, if you do not appoint a guardian for your minor children, a judge who doesn’t know you or your family may have to make that decision for you. Wills can be basic or complex-- depending on the size and complexity of your estate. But your will can allow you to truly "have it your way" with your assets when you finally meet your maker.
Health Care Directive
Minnesota allows you to designate a trusted family member or friend to make medical decisions for you in the event you become unconscious or mentally incapable of making those decisions for yourself. The same document - called a "Health Care Directive" (f/k/a "living will") allows you to instruct your health care providers to refrain from using artificial methods to extend your life in the event you are diagnosed with a terminal or irreversible condition. Your directive can also give permission to close family members to look at your medical records and/or receive your health information. This is important because HIPAA, the Health Insurance Portability and Accountability Act, sets rules and limits on who can look at your medical records or receive your health information. Covered entities that violate HIPAA face stiff penalties, which make them reluctant to share medical information with anyone but the patient, even close family members.
Trusts are legal instruments that are used to control your assets during and/or after your death. You (the "trustor" or "grantor") may retain that control yourself or turn the control over to someone else--- your "trustee". With trusts, your assets can only be used in accordance with the specific instructions you provide in the trust document. Trust assets are held for the benefit of your "beneficiaries". Trusts can be used to avoid probate, save taxes, protect assets, and provide for a more simplified handling of your estate.
There are many variety of trusts, including revocable or irrevocable trusts, charitable trusts, life insurance trusts, testamentary trusts, and "inter vivos" (between the living) trusts.
Powers of Attorney
A statutory (durable) power of attorney gives you the power to appoint a trusted family member or friend as your agent (your "attorney in fact") to manage your finances if you are no longer capable of managing them yourself. If you become temporarily or permanently disabled, you need someone else to pay your bills and do your banking. If you become disabled and do not have a statutory durable power of attorney in place, a court-ordered guardianship may be necessary. Guardianships are time-consuming and expensive, and can be avoided by creating a simple and inexpensive power of attorney. Powers of attorney are not just for the elderly. Unexpected injuries or illness can occur at any age, so all adults should have one in place.
Estate planning is the process of protecting your assets while you are still alive to insure that your assets will be properly handled and distributed after you die. Every adult, including those who are young or in good health, should develop a plan that explains how they want their assets to be distributed when they are gone. If you die without a will or trust in place your assets will be divided during probate in the manner established by the intestacy laws of Minnesota. For many of us, however, the distribution formula provided by the Minnesota intestacy laws does not produce the results we want. In many cases, the relatives, friends, charitable causes or other beneficiaries we would like to receive our estate receive nothing under these rules. A will or trust can eliminate this problem by directing your money and other assets to reach the heirs or others that you have selected in the manner you see fit.
"Elder law" is an umbrella term that refers to legal issues we all confront as we age. We will all face estate planning, retirement planning and its tax implications, healthcare issues and the requirements for Medicare or Medicaid, and guardianships and conservatorships, as we age. Despite its name, people should start understanding elder law issues and planning well before retirement age. Planning is even more urgent for someone with elderly family members who are disabled or have special needs. . It is also imoportant to know the "ins and outs" about Medicaid or Medical Assistance. Medicaid-- known as Medical Assistance in Minnesota-- is a combined federal and state program designed to provide financial assistance to those in need for their medical and long-term-care expenses. It is the only government program that will pay for long-term nursing home care. The rules that establish qualification for Medicaid/Medical Assistance are very complicated and change frequently. It is imperative that you speak with a qualified elder law attorney before taking any actions that might cause problems for you and your family. Many actions concerning Medicaid/ Medical Assistance can also have family relationship, tax, and legal ramifications that must be considered.