GROSSKOPF & BURCH

Is a Revocable Trust Right for You?

6/30/2025

You may have friends or family who say you should have a revocable trust (also referred to as a living trust). It is true that many people use a revocable trust as part of their estate plan. However, is having one as the cornerstone of your plan right for your family? Here are some of the main reasons why many use a revocable trust. See if they are right for you and your family.

Avoiding Probate. Probate is the court’s legal process that happens after someone dies. It can take a long time (typically 9-12 months) and cost a lot of money. If you have a revocable trust, your family can skip probate for the assets in the trust. This means your loved ones can get what you left them faster and with less stress.
Staying in Control. When you create a revocable trust, you’re still in charge. You can change it, add or remove things, or even cancel it at any time—as long as you still have the legal capacity to do so. This gives you the freedom to update your plan if your life changes.
Planning for Illness or Injury. If you ever get very sick or hurt and can’t make decisions, having a revocable trust may help. In addition to a financial power of attorney, your revocable trust allows you to choose someone you trust to take over and manage your money and property (called the trustee). This way, your bills get paid and your affairs stay in order without needing a court to step in and appoint a guardian.
Keeping Things Private. Wills go through probate, which is a public process. This means anyone can ask to see your Will to see what you owned and who got what. A revocable trust is private. It does not get filed with the court. Only the people involved need to know the details.
Managing Property in Other States. If you own property in more than one state, a trust can save your family from going through probate in each state. Everything in the trust is handled by the trustee regardless of location, which saves time and money.

A revocable trust is a helpful way to protect your property, plan for the future, and make things easier for your family. It gives you control now and peace of mind later. If you think a trust might be right for you, contact our office today to schedule a time to talk with our estate planning attorneys.

5 Long-Term Care Medicaid Myths You’ll Want to Know the Truth About

6/10/2025

Did you know what the largest source of funding for nursing home care is? It’s Medicaid. Medicaid, which is often called Medical Assistance or Title 19, has many confusing rules that create serious frustration for those needing to access benefits. Processes by which one can protect their assets and still be eligible for Medicaid either through pre-planning or emergency planning can be even more perplexing without finding the right guidance down that path.

I often hear clients share things they have heard about Medicaid. “My neighbor told me … ,” or “my aunt’s experience was … ,” but normally as we speak, there are missing
pieces of information to the puzzle. Everyone’s situations are different, and without the details, it’s hard to apply the Medicaid rules. Not knowing the details and the rules has led to many myths about exactly who qualifies for Medicaid, what coverage it provides, what assets can be protected, and when.
I’d like to share with you five myths regarding Medicaid’s Long-Term Care Coverage followed by “the truth of the matter.”

1. Myth: “Medicare will pay for my nursing home stay.”
Well, let’s talk about this. Medicare is the federal health insurance program for people 65 years of age and older, certain people under age 65 who are receiving Social Security Disability Insurance, and people with End-Stage Renal Disease. Medicare’s coverage of nursing home care is very limited. Medicare covers up to 100 days of “skilled nursing care” per “spell of illness” (20 full pay days and an additional 80 co-pay days). To qualify, there are three primary requirements. First, you must enter a Medicare-approved “skilled nursing facility” within 30 days of a hospital stay that lasted at least three days (meaning admission as an inpatient; “observation status” does not count). Second, the care in the nursing home must be for the same condition, or a condition that is medically related to the condition, that caused the hospital stay. Third, the care received must be daily care at a “skilled” level which cannot be provided at home or on an outpatient basis. The care must be ordered by a physician and delivered by, or under the supervision of, a professional such as a physical therapist, registered nurse, or licensed practical nurse. What does this mean? Medicare coverage is minimal, so alternate plans are needed to pay for long-term care in an assisted living facility, community based residential facility, or nursing home.

2. Myth: “Only people who are broke qualify for Medicaid.”
Most of my clients don’t want to spend their entire life’s savings to be eligible to utilize Medicaid as a payment option for long-term care. Medicaid is a “means tested” state-run program intended to help low-income individuals pay for long-term care. That said, I regularly explain to people that you do not need to be completely penniless to qualify. In Wisconsin, a single Medicaid applicant can have no more than $2,000 in “available” assets to be eligible to receive benefits. The spouse of a Medicaid applicant, also called the “community spouse,” may retain as much as $157,920 without jeopardizing the Medicaid eligibility of the spouse who is receiving long-term care. Certain “exempt assets” (a house, a car, and personal possessions such as clothing, furniture, and jewelry) do not impact eligibility. Different planning options can be recommended based upon your individual situation. More specifically, my recommendations depend on whether you are proactively anticipating the need for future assisted living or nursing home care vs. emergency planning for imminent care needs.

3. Myth: “If I gift my assets to my children, then Medicaid can’t take it from me.”
While technically true, there are holes in this methodology. Medicaid staff will look at all gifts you’ve made within the five years before you apply for Medicaid. This is known as the “Five-Year Look-Back.” After a gift is made (i.e., giving your children your money, house, or other assets for less than fair market value), which Medicaid calls a “divestment”, Medicaid will impose a penalty period – meaning a period of time that Medicaid will not pay for your care and you will need to find an alternative way to pay for your care. The length of the penalty period depends, in part, on the amount of money you give away. This often means self-paying. But wait a minute, if you’ve given away your assets, you no longer have the money that you would need to self-pay. Now what? This could mean asking for the gifts back or seek alternative options, which are often even less desirable. This doesn’t mean that you can’t transfer assets at all — there are limited exceptions (for example, you can transfer money to your spouse without incurring a penalty). I highly encourage my clients to speak to me before transferring any assets, so their planning will continue to work as intended. Pre-planning your asset protection will avoid, or greatly reduce, the impact of the Five-Year Look-Back.

4. Myth: “I can gift up to $19,000 a year under Medicaid rules.”
Incorrect. What’s happening here is confusion between gift tax rules and Medicaid rules. You can give away up to $19,000 a year without incurring a gift tax. Unfortunately, under Medicaid law, as noted earlier, gifts are considered divestments. A gift of $19,000, or any other significant amount of money, could trigger a penalty period if it was made within the Five-Year Look-Back.

5. Myth: “My spouse and I have a prenuptial agreement, so my assets won’t be counted if my spouse needs Medicaid.”
This too is a myth. A prenuptial agreement works to keep property separate in the event of death or divorce, but for Medicaid eligibility purposes, a prenuptial agreement does not keep your property separate. Medicaid deems the assets owned by either spouse as available resources.

Unfortunately, these 5 myths are only the tip of the iceberg when it comes to understanding Medicaid’s long-term care coverage. It’s important to consult an elder law attorney before making assumptions based upon comments you hear in passing or information you find on the world wide web. Planning early and seeking the guidance of an experienced elder law attorney can help you down the path that’s right for you.

Life Estate Deed vs. Transfer on Death Deed

12/31/2024

Estate planning offers choices in how to structure your plan. In an effort to avoid probate, clients often want to discuss using a deed to automatically transfer real estate to their children. The choice is whether to use a Life Estate Deed (“LE”) or Transfer on Death Deed (“TOD”).

Both deeds will transfer the real estate upon death without probate. This may be problematic, however, if there are multiple beneficiaries on the deeds or a beneficiary with legal or financial issues when the property is transferred. Both deeds will allow for a cost basis adjustment on death to help eliminate any capital gain. Both deeds require the current owners to pay for all taxes, insurance, utilities, etc., related to the property.
The TOD works like a beneficiary on a life insurance policy. The beneficiary of a TOD has no ownership in the property until the current owner dies. This means that if the current owner wishes to sell the property, the TOD beneficiary does not take part in the sale or receive any of the proceeds of the sale.

A TOD is a good choice if you are looking to keep full ownership and have flexibility to sell the property and not share the sale proceeds. It also avoids unexpected tax issues for the beneficiaries if the property is sold during lifetime.

A LE actually splits the ownership of the property so that the current owners (the “life tenants”) own the property during their lifetime. The value of this interest is a percentage of the total value of the property, determined by the life tenant’s age. The future ownership of the property is actually owned by the “remaindermen.” This means that the owners, whether life tenants or remaindermen, can sell or encumber their individual interest in the property without consent by the other owners. Because the property has multiple owners, if the property is sold, all owners must take part in the sale and receive their share of the sale proceeds. The transfer of the remainder interest when the deed is made is a gift, so gift tax consequences must be analyzed, too.

A LE is helpful if the current owner needs to reduce the value of the property they own without giving up control. The life tenant may also want to shift some capital gain to the remaindermen when selling the real estate during the life tenant’s lifetime.
If you think one of these deeds may help carry out your estate planning goals, or whether one of these deeds would be a good alternative to a trust, please contact our office to schedule a consultation today.

What is a special needs trust?

9/10/2024

A special needs trust (SNT) may go by different names (e.g., special needs trust, supplemental needs trust, d(4)(A) trust, pooled trust). What makes a trust and SNT is not its name, however, but what it is designed to do.

An SNT is a trust that enables someone with disabilities to hold assets without affecting their eligibility for means-tested public benefits such as Medicaid or Supplemental Security Income. While assets held by the trust are not “countable” for the purpose of qualifying for such programs, there are strict regulations about disbursements from an SNT. SNTs are meant to supplement the funds and services available through government programs.
There are two main categories of SNTs: i) first-party SNTs; and ii) third-party SNTs. The distinction is who the assets belonged to prior to transferring them to the trust.

A first-party SNT (also called a self-settled or d(4)(A) trust) is created with assets belonging to an individual with disabilities. These assets are typically funds from a personal injury settlement or inheritance. To create a first-party SNT, the disabled individual must be under 65 at the time that the trust is established; the trust must be used only for the disabled beneficiary; and any funds remaining in the trust at the beneficiary’s death must reimburse Medicaid for services to that individual before distributions to anyone else.

A third-party special needs trust (also commonly called a supplemental need trust) is created by someone other than the disabled individual and funded with assets owned by anyone other than the disabled individual (e.g., parents or grandparents). These trusts can be created and funded during the life of the creator or upon creator’s death as part of the creator’s Will or Trust. Other than where the assets come from, the other main distinction between a third-party and first-party trust is what happens at the beneficiary’s death. A third-party trust does not need to reimburse Medicaid, so any remaining funds can be distributed to other beneficiaries.

A pooled SNT can be either a first-party or a third-party SNT. A pooled SNT is distinguished by who manages the trust. A nonprofit corporation manages a pooled SNT, working closely with a corporate trustee. A pooled SNT is made up of multiple sub-accounts, each sub-account belongs to an individual beneficiary, who must be disabled in accordance with Social Security Administration guidelines. The ability to “pool” together multiple sub-accounts make a pooled SNT a great alternative for small trusts or trust where finding a suitable trustee may be difficult.

If you would like to discuss how an SNT may be useful for your estate plan, please contact our office today.

Why would I even want a Will?

3/14/2024

There is a trend to try and avoid probate at all costs. Yet probate need not be feared, and avoiding probate is not always advised. Here are three situations (here may be more) where you should at least consider probate.

Cost. There are costs to probate, but those are incurred after your death. Although trusts are a great way to avoid probate, they come with an upfront cost that may be too much for you while living. Spending money now means it will not be there for you down the road. You may benefit from keeping your hard-earned money for your use while you are living. In addition, trust administration is not automatic or free. There will still be cost your trust bears after your death, although they are often less than the cost of probate.
Medicaid. If you are married and your spouse is receiving Medicaid benefits, then probate is necessary to help protect the Medicaid benefits in case you die before your spouse. Probate in this scenario is worthwhile because it helps preserve your spouse’s Medicaid benefits.
Family dynamics. Some families benefit from a referee. Going through probate allows the court to make sure things run smoothly and give your heirs easy access to the court to settle disputes. A trust, by design, is meant to be private. There is no oversight of the trustee by a third party.

As with all estate planning, there is no one-size-fits-all plan. Each person has particular goals and desires. Each family has its own unique relationships and history. If someone tells you that you “must have a trust” or “no one should go through probate,” you should get a second opinion. Contact our office today to schedule your initial consultation or to have your current plan reviewed. We look forward to meeting with you.

Transfer on Death Deed: Proceed with Caution

1/12/2024

Often people want to make the transfer of their estate as easy as possible. This usually means avoiding probate is their main goal. To avoid probate, many people record a Transfer on Death Deed for their real estate (“TODD”). A TODD works like a beneficiary on a financial account. When the owner of the real estate dies, the real estate is immediately transferred to the beneficiaries named on the deed.
Although a TODD can transfer real estate very easily, you should proceed with caution. Transferring things with ease does not always mean that things will be easy for those who receive the real estate. So, what could possibly go wrong with a TODD? I’m glad you asked. Here are three things you should consider:

Refusal to sell. I have had families come to me after Mom or Dad’s death to deal with a sibling that refuses to sell the real estate Mom or Dad left to the children via a TODD. At the time, Mom or Dad thought it would be easy to leave their real estate to their kids by using a TODD. Probate would be avoided. The transfer would be easy. What they didn’t anticipate is what happens after that easy transfer.

By using a TODD deed, Mom or Dad created a situation where the real estate was immediately owned by multiple people. Multiple owners have all the same rights to the property, so all of the owners have to agree on the listing agent, listing price, negotiations, final sale price, etc. This opens the door for disagreement. There are better options to avoid this outcome.

Death of a Beneficiary. There have been times where a beneficiary of a TODD died before Mom or Dad, and the TODD remained unchanged. This opens the door to owners of the real estate who were not intended (usually the children of the deceased beneficiary). Now, the property Mom thought would be owned by her children is owned by grandchildren, too. Creating more owners and decision makers.

Transfers to Widow. It is not uncommon for Mom or Dad to name a child and their spouse as “joint owners” on a TODD. While this makes Mom or Dad happy to see an in-law treated as family, it does cause potential issues. If the child predeceases Mom or Dad, the widow will take ownership at Mom or Dad’s death. This can result in the property being controlled by someone who may have no connection to the family or may remarry and make their property interest part of their new estate plan, with their new spouse, risking the family property from staying in the family.

As you can see, just “leaving things to the kids easily” does not always mean things will be easy once the property has been transferred to the kids. Before you record a TODD, please contact us to schedule a consultation to discuss whether the TODD meets your estate planning needs.

Beware: Pitfalls of Beneficiary Designations

11/15/2023

Sometimes clients want to avoid probate so badly they overuse beneficiary designations and inadvertently destroy their wishes. Realizing the impact beneficiary designations have on your goals and plan are important considerations we discuss with our clients.

Follow this link to a good article discussing potential pitfalls.

Can you do a handwritten will?

7/25/2023

A recent case in the news, namely the handwritten will of music superstar Aretha Franklin, raises the question of whether or not a person living in Wisconsin can do a handwritten will. In the Franklin case, a jury in Michigan had ruled that a handwritten note from the late singer was a valid will.

In 2019, Aretha Franklin’s niece had found three handwritten documents scattered about the singer’s home near Detroit. One, dated 2014 was found underneath the couch cushion. There was another, earlier note from 2010, which had been found under lock and key in the singer’s home. And finally, a more recent will which changed some of the language in the earlier documents.

Apparently, the documents themselves were difficult to read; but the jury concluded that the 2014 note had her name signed at the bottom, with a smiley face written inside the letter “A”, which was apparently typical of her actual signature.

The Franklin case deals with what is known as a “holographic” will, meaning that it is handwritten by the maker, but does not require witnesses. These Franklin wills also highlight the problems associated with these holographic wills. Such wills are valid in some states, but not in Wisconsin. In Wisconsin, a handwritten will may be deemed valid, but it still requires the date of the will and signature of the maker, as well as signing in front of two disinterested witnesses, who also simultaneously sign the document. These safeguards are viewed as essential to ensure the validity of the Last Will and Testament. Even better would be to have the will drafted by a competent attorney and executed with the statutory formalities.

Here at Grosskopf & Burch, we have experience in drafting wills, trusts, and other estate planning documents, and also have experience making sure they are properly drafted, executed, witnessed, and later filed with the Court if necessary.

What is an Advance Directive?

6/12/2023

What is an Advance Directive?

Advance Directive is an umbrella term used for documents you create that either express your wishes regarding health care decisions or name someone who is able to speak for you if you cannot express your wishes yourself. If you do not have someone who can speak for you, a court-appointed guardian will be needed.

In Wisconsin, there are three main documents commonly referred to as Advance Directives: Health Care Power of Attorney, Living Will (officially called a Declaration to Health Care Professionals), and a Do-Not-Resuscitate Order (a DNR).

A Health Care Power of Attorney is an extremely important document to have. In your Health Care Power of Attorney, you appoint someone (your “Agent”) to make medical decisions for you if you are unable to make them on your own. Care should be taken in selecting your Agent, as they will be speaking for you after you have been declared incapacitated and unable to make medical decisions.

A Living Will (or Declaration to Health Care Professionals) is a document that expresses your wishes related to life sustaining procedures if you are in a persistent vegetative state or have a terminal condition. It is important to note that this document does not replace your Health Care Power of Attorney. Your Agent will always override your Living Will when there is a contradiction between the two. This is why we highly recommend having conversations with your Agent about your end of life and other medical wishes.

A Do-Not-Resuscitate Order (a DNR) is only issued by your doctor. You must qualify to have the DNR based on your current medical condition. The DNR is a written document you sign that becomes part of your medical record.

Advance Directives should be part of your comprehensive estate plan. Without a Health Care Power of Attorney, your loved ones will be forced to have the court appoint a guardian for you should you become incapacitated. Planning ahead will save you and your loved ones the time, expense, and emotional toll associated with a guardianship appointment.

Please contact us to discuss your Advance Directive needs.

May is Elder Law Month

5/19/2023

May has been designated as Elder Law Month by the National Academy of Elder Law Attorneys. Both Peter E. Grosskopf and Aric D. Burch are members of the National Academy of Elder Law Attorneys and invite you to learn more about the practice of Elder Law. Elder Law has changed over the years. It used to be thought of as simply dealing with preparation of documents for our seniors, such as Financial Powers of Attorney or Healthcare Powers of Attorney. Since that time, it has become a larger part of the legal landscape. At a time when Estate and Inheritance Taxes have become nonissues for a great many people across the country, the legal issues facing our elderly have increased many times over. For example, “Elder Law” can include many such things, including:

Planning for Medicare;
Planning for Medicaid, which is that part of the government that can pay for long term care in nursing homes, assisted living, or even in home care;
Estate Planning and Probate, and ways to avoid Probate;
Guardianship or Conservatorship;
Asset Management;
Financial Powers of Attorney or Healthcare Directives;

Even with Financial Powers of Attorney and Healthcare Directives, for most situations, the simple, free documents that exist are simply inadequate to deal with the reality of planning or qualifying for Medicaid or end of life health issues or financial management. Joint bank accounts can be a trap for the unwary, misinformation about “Medicaid Spend Down”, and Medicaid’s “Five Year Lookback” are found everywhere.
That is why it is important to make sure that you are dealing with a qualified Elder Law Attorney such as the attorneys here at Grosskopf & Burch. We look forward to meeting with you and assisting you with your needs, now and in the future.
For more information about the advantages of hiring an Elder Law Attorney, please see the article "Why Hire anwww.elderlawanswers.com/why-hire-an-elder-law-attorney-19642 Elder Law Attorney?"