April 20, 2012 in Elder Law, Estate Planning, Legal, Legal Articles, Special Needs by jferris

VA-Funded Study Shows Vets Prone to Addiction Still Given Opiates to Treat PTSD

A government study released in March shows that many painkillers given to war veterans suffering from post-traumatic stress disorder often lead to addiction.

Veterans who served in Iraq and Afghanistan and came back from war with PTSD were twice as likely to be given prescriptions for painkillers that have proven to be addictive compared to vets with only physical pain, according to the study.

Caregivers were approximately four times more likely to give the drugs to veterans with PTSD and a history of problems with substance abuse.

The study was paid for by the Department of Veterans Affairs and it was based on the VA’s data. It was published by the Journal of the American Medical Association.

All of the veterans of Afghanistan and Iraq who were diagnosed with physical pain between October of 2005 and December of 2010 were involved in the study, which equals 141,029 servicemen and servicewomen.

Vets with PTSD who were given morphine and other strong painkillers had a higher risk of suicide, alcohol and drug overdoses and self-inflicted injuries, according to the study. These consequences were rare, but still notable.

The study shows that it is a difficult task to treat painful injuries as well as painful memories. The study’s authors and other experts indicate other treatments including therapy and other drugs would be less risky, according to FoxNews.

Some doctors could be prescribing powerful, opium-based drugs like hydrocodone and morphine precisely because of their strength to potentially dull extreme physical pain or help reduce emotional distress. Opioids often make psychological problems worse, according to sources speaking to FoxNews.

In 2009, the VA adopted a pain management philosophy that requires opiate prescriptions be accompanied by non-drug mental health care. This came at the end of the study.

The VA distributed a press release about the study indicating that the agency’s pain management approach is a model of effective care, but “…we recognize that more work needs to be done.”

There were 15,676 veterans given opiate prescriptions in the study for physical pain. Those numbers included 18 percent of the vets with PTSD and about 12 percent of those with different mental health diagnoses. The opiate prescriptions were given to only about 7 percent of the veterans without those problems.

Since many veterans coming home from the wars in Iraq and Afghanistan are young, they are often struggling to find their place in civilian life, according to a Yale University teacher and doctor who spoke with FoxNews. Dr. William Becker works with veterans on substance abuse problems. The best treatment in that environment is therapy and behavioral management for the PTSD and separate chronic pain management for the physical injuries of war. He said the study “…brings much needed attention to the complexity of this problem.”

To learn more or to contact a Veterans disability lawyer, Veterans disability attorney, Veterans lawyer, or Veterans attorney call 1.800.693.4800 or visit Legalhelpforveterans.com

April 19, 2012 in Elder Law, Estate Planning, Legal, Legal Articles, Personal Injury, Special Needs by jferris

Digital Badges Could Help Veterans Translate Military Skills into Civilian Jobs

As part of a concentrated effort to help veterans find jobs, the Department of Veterans Affairs is sponsoring a contest for an entrepreneur to create a digital badge system that will help veterans translate their experience for prospective employers in civilian jobs.

Digital badges have taken on an increased importance recently as more people try to move into the civilian workforce after some time away in the military, taking online classes or even volunteering and doing charity work.

Badges are envisioned as supplements to a traditional resume that have a digital link where prospective employers can determine their authenticity. The MacArthur Foundation in Chicago is leading the badges revolution. The foundation gave a $1 million grant to the Mozilla Foundation to develop a consistent standard for badges that can be used across platforms.

The VA contest winner will design badges to help translate military experience into classroom credit or work-related training, according to a press release from the VA.

“We are looking for ways to make it easy for employers to see Veterans for who they are: highly qualified individuals in any job applicant pool,” Secretary of Veterans Affairs Eric Shinseki said in the release. “We want to help good jobs find Veterans and help Veterans find good jobs.”
Along with the VA, the “Badges for Vets” contest also is being sponsored by the U.S. Departments of Education, Labor and Energy. The contest is part of the larger MacArthur Foundation project called the Badges for Lifelong Learning Competition.
The VA Innovation Initiative announced three finalists in the competition in March.
• TopCoder Inc. is an IT consulting company that developed a way to issue badges representing military experience and training to help qualify veterans for a specific assignment.
• Western Governors University has a program to award transfer credit to veterans who have earned badges for corresponding training in the military.
• The Manufacturing Institute has a plan to use badges to help veterans find jobs on its jobs and talent matching platform online.
A winner from among those three will be announced after Memorial Day, according to the release.

The contest calls for $25,000 in prizes for the winners in five categories for companies to design and deliver badges that are representative of veterans’ transferable skills from the battlefield to the cubicle.

Other industries using badge systems to help bridge people’s skillsets with potential employers include NASA, Disney and the library and manufacturing industries.

To learn more or to contact a Veterans disability lawyer, Veterans disability attorney, Veterans lawyer, or Veterans attorney call 1.800.693.4800 or visit Legalhelpforveterans.com

February 29, 2012 in Elder Law, Estate Planning, Legal, Legal Articles by jferris

Suicide Rate Levels Off in Army After Years of Climbing

The suicide rate among active duty military dropped in 2011 for the first time since 2004.

The numbers are falling because of efforts by the military to understand behavior that lead to suicide among soldiers, according to the Wall Street Journal.

Among active-duty soldiers and those in the Reserves and the National Guard, 278 took their own life in 2011. That number is down by nine percent from the 305 in 2010 and finally stops an annual rise in the numbers.

Army officials told the Wall Street Journal they consider the numbers to be “leveling off” in part because of mental health screening and a better understanding of post traumatic stress disorder and concussions. The draw down of troops deployed overseas also is playing a role in the changing statistics, according to the report.

The numbers started to climb in 2005 as troop deployments to Iraq and Afghanistan became longer and more frequent. Concussions and traumatic brain injuries have been more regular injuries among soldiers because of the roadside bombs that are a signature of the two wars, according to the WSJ.

The suicide rate in the Army, 24 per 100,000, continues to be higher than that of the general population in the United States, about 19 for every 100,000 people. For soldiers who served in Afghanistan and Iraq, the rate is about 38 per 100,000.

In studying the suicide rates, the Army found that concussions have become a serious problem among soldiers who have served in Iraq and Afghanistan. Screening for mental health issues has brought to light a concussion rate that has gone up five times in 10 years. Traumatic brain injuries can be especially difficult on the mental health of the victim.

While announcing the good news about suicide rates, the Army also announced bad news about domestic abuse and child abuse among soldiers.

Soldiers charged with sexual assault jumped 41 percent since 2006 to 2,290. Domestic violence went up 85 percent since 2001 to 2,699 reported occurrences. The Pentagon has proposed a strategy for addressing these crimes.
Army Vice Chief of Staff Gen. Peter Chiarelli discussed the numbers in January while announcing the Pentagon’s proposals for addressing gaps in policy that could lead to better mental health care.

Chiarelli also proposed a name change for the often-diagnosed Post Traumatic Stress Disorder. If the health care community drops the word “disorder” then soldiers and veterans might be more inclined to seek help, he said.

“I just want to get rid of the ‘D,’” Chiarelli said. “You can have the best treatments in the world, but if you can’t get someone to come in and get the treatment because they don’t want to admit that they have a [disorder], they aren’t going to come in.”

Veterans having a difficult time getting the legal help they need to fight for their health care benefits should contact a qualified attorney.

James G. Fausone is a Veterans disability lawyer and Veterans attorney with Legal Help for Veterans, PLLC. Learn more at http://www.legalhelpforveterans.com.

January 30, 2012 in Estate Planning, Legal, Legal Articles by jferris

Filing Becomes Important As Estate Tax Laws Change Even If Widows Do Not Owe Money

A new portability clause in the American tax laws is good news for estate planning but likely cannot be relied upon permanently.

The provision allows a surviving spouse to claim any exemption not used by their deceased spouse on their own estate tax return. Since the exemption in 2011 was $5 million, a widow left with a $3 million estate owes no taxes. But then when the widow passes, the remaining $2 million can be added to the same $5 million ceiling. This means the widow’s estate is exempt for up to $7 million, according to Forbes.com.

This portability of estate exemption is simple compared to the tax maneuvers some estates attempt to avoid these taxes, and it was praised by tax lawyers upon signing. Unfortunately, the portability option concludes at the end of 2012, so it is only helpful to people who happen to lose a spouse in this calendar year.

In rare cases, someone who is terminally ill could use the portability option but even then it’s still guesswork. The new law also complicates taxes for the surviving spouse if he or she decides to remarry one day.

So, while the sentiment from Congress was well-received in the estate law community because it addresses one of that group’s significant concerns, the portability provision is almost unusable because it sunsets so quickly, according to Legalnews.com.

For now, the portability option will mean lots of paperwork for the IRS. As Congress’ new rules mean fewer estates have to pay taxes, the new law encourages more estates to file tax returns even if they don’t owe, according to Forbes.

So all surviving spouses this year have to file an estate tax return regardless of whether they owe or they lose the portability option forever. Estates have nine months to file an estate tax return and many miss that deadline.

Legislators could agree in 2012 to extend the portability provision in the estate tax law, or they could rewrite the whole thing. Forbes reported that the President has proposed bringing the estate tax laws back to where they were in 2009 when there was a $3.5 million exemption and a 45 percent tax rate.

Congress is notoriously unpredictable when it comes to drafting estate tax law. In late 2009, the U.S. Senate failed to vote on a bill that would have fixed a scheduled expiration of the tax. That meant there were no federal taxes on estates in 2010, according to Businessweek.com.

At the end of 2010, Congress passed the Tax Relief Unemployment Insurance Reauthorization and Job Creation Act. This is the law that brought the exemption to $5 million and introduces the portability option.

O. Reginald (“Reggie”) Osenton is the Owner and President of Osenton Law Offices, P.A. If you need a Brandon estate planning lawyer, Tampa estate planning lawyer, or Tampa probate attorney, call 813.654.5777 or visit Brandonlawoffice.com.

December 27, 2011 in Estate Planning, Legal, Legal Articles by jferris

New Probate Laws Open the Door to More Florida Lawsuits

New laws went into effect in Florida this fall that change the way estates are divided in the event that the deceased did not leave a will and offer opportunity for descendants to have the will reinterpreted by the courts.

In most cases, the spouse of the deceased will be left with everything after all of the debts and taxes are paid. This changes the old Florida law that split the estate among the surviving spouse and the surviving children.

In the event that the deceased had children who are not descendants of the surviving spouse, they will now get half of the remaining estate, according to Florida law.

These rules could mean an increased number of lawsuits filed by family members who claim to know the intent of the deceased despite the lack of a will. Since the laws changed, wills that had not been amended since the new laws went into effect will come under closer scrutiny.

The two most significant changes to the law concern the change in the surviving spouse’s inheritance and the court’s ability to change a will if someone presents a case that the will does not represent the intent of the deceased.

If the deceased had no will, then the surviving spouse now will inherit the entire estate if all of the children belong to both the deceased and the surviving spouse. Previously, the surviving spouse would get $60,000 and the other monies would go to the rest of the estate. Portions of the old law continue to apply if there is a surviving child outside of that marriage.

The other significant change in Florida probate law that went into effect this year allows the court to change the will – even if it was unambiguous – if the interested party can prove the intent of the deceased was different from what was in the will.

This could potentially open the doors to many new lawsuits. The law change even says, “In determining the testator’s original intent, the court may consider evidence relevant to the testator’s intent even though the evidence contradicts an apparent plain meaning of the will.”

Probate in Florida includes paying the debt of the deceased as well as taxes and, in some cases, funeral expenses. This occurs before the family or other heirs receive their inheritance. Often this process takes as long as a year (or more) and is handled by Florida circuit courts.

An experienced attorney can help put together a will that serves the exact wishes of a client. But that will needs to be revisited annually to make sure that it is still up to date. In many cases, the attorney can develop an estate plan to minimize probate or avoid it entirely.

Brandon estate planning attorney Reginald Osenton has experience helping clients develop wills, trusts, living wills and power of attorney documentation. He also has experience in helping clients avoid probate, or in helping family members probate estates throughout Florida.

O. Reginald (“Reggie”) Osenton is the Owner and President of Osenton Law Offices, P.A. If you need a Brandon estate planning lawyer, Tampa estate planning lawyer, or Tampa estate planning attorney, call 813.654.5777 or visit Brandonlawoffice.com.

August 31, 2011 in Elder Law, Estate Planning, Legal Articles, Personal Injury by jferris

Veteran’s Appeals

An applicant can appeal a VA decision if he or she was awarded only partial benefits or if the claim was denied.

Levels of Appeal
Regional Office Appeal
Once the regional VA office issues a determination, in the form of an award letter, the application can request reconsideration of the decision. The claimant should provide the VA with any other relevant evidence. For example, if the VA did not deduct unreimbursed medical expenses, such medical expenses can be submitted with a request for reconsideration.

If this request for reconsideration is unsuccessful, the application can request an evidentiary hearing at the regional office by filing a notice of disagreement, typically in the form of a letter. [] This notice of disagreement must be filed within one year from the date of the award letter. [] Upon receipt of this notice of disagreement, the VA will issue a statement of the case, which is the VA’s official notice detailing the basis for its decision. This statement of the case includes a summary of all evidence that the VA received and considered, applicable laws and regulations, and the reason for the determination.

The applicant must then file a substantive, or formal, appeal with the regional office within 60 days of the date of the statement of the case or within one year of the date on the original award letter, whichever is later. [] This appeal is filed on VA Form 9. At this level of appeal, most applicants are represented by service organizations, but a recent change in the law now allows attorneys to represent applicants and to receive payment for services after the notice of disagreement has been filed with the VA.

Board of Veteran’s Appeals
Appeals to the regional office are usually unsuccessful, so the applicant can then appeal to the Board of Veteran’s Appeals (BVA). The BVA has jurisdiction to review all questions of fact and law that are on appeal of a claim filed by a veteran, a dependent of a veteran, or a survivor of a veteran. [] This review is de novo, and new evidence can be presented. []

3. U.S. Court of Appeals for Veterans’ Claims (CAVC)
Upon receipt of an unsatisfactory BVA decision, the applicant can appeal to the U.S. Court of Appeals for Veterans’ Claims (CAVC). The CAVC has exclusive jurisdiction to review BVA decisions. [] The notice of appeal to the CAVC must be filed within 120 days of the BVA decision and must comply with Rule 3(c) of the Court Rules of Practice and Procedure. [] The CAVC reviews the administrative record created at the BVA, so no new evidence is presented. Very few cases are taken to the CAVC, but there is a high success rate of those that come before the CAVC.

U.S. Court of Appeals for the Federal Circuit
The Federal Circuit has nationwide jurisdiction over a variety of matters, including veterans’ benefits. The appellant must file a Form 4, and the appeal must be filed with the district clerk within 30 days after the judgment or order appealed from is received at the clerk’s office. [] Often, VA cases decided by the Federal Circuit become precedent for future VA cases.

Begley Law Group, PC has attorneys who can provide advice and strategies for you to qualify for these valuable benefits, even on appeal. Each of the Partners at Begley Law Group, PC is an Accredited Attorney by the Department of Veterans Affairs (VA) and can assist you in Veterans Planning. Begley Law Group is a family-oriented law firm with a century-plus of combined attorney experience. To learn more, go to www.begleylawgroup.com or call 800-533-7227.

Begley Law Group, P.C.
509 South Lenola Road, Building 7
Moorestown, NJ 08057

Thomas D. Begley, III, CELA is a New Jersey elder law attorney with The Begley Law Group. To contact a New Jersey estate planning, special needs planning, or elder law attorney, call 1.800.533.7227 or visit http://www.begleylawyer.com.

August 30, 2011 in Elder Law, Estate Planning, Legal Articles, Personal Injury by jferris

Medicare Part D Appeals

Each drug plan must have an appeals process. Expedited requests are available.

Stages of Review
Coverage Determination
A coverage determination is issued by the drug plan. It may be requested by a beneficiary, the beneficiary’s appointed representative, or a prescribing physician. The drug plan must issue a coverage determination as expeditiously as an enrollee’s health requires, but no later than 72 hours (for a standard request, including when the beneficiary already paid for the drug) or 24 hours (if expedited because the standard timeframe would jeopardize the life or health of the beneficiary or the beneficiary’s ability to regain maximum function).

An “exception” is a type of coverage determination. It gets the enrollee into the appeals process. Beneficiaries may request an exception to cover non-formulary drugs, to waive utilization management requirements, and to reduce cost-sharing for a formulary drug. There is no exception for specialty drugs or to reduce the costs of tiered co-pay for generic drugs. A doctor must submit a statement in support of an exception.

There are national coverage determinations (NCDs) and local coverage determinations (LCDs). A request to issue an NCD must be made to CMS, but a request to issue an LCD must be made through the local Medicare Administrative Contractor. An individual can file a challenge with CMS to get a policy overruled even if he or she did not receive the service. Additionally, relief may be in the form of changing the policy, rather than awarding coverage.

A statement by a pharmacy, not by the plan, that the plan will not cover a requested drug is not a coverage determination. Enrollees who want to appeal must contact their plan to get a coverage determination. Drug plans must arrange with their network pharmacies to post generic notices telling enrollees to contact the plan if they disagree with information provided by the pharmacist.

Redetermination by Drug Plan
If a coverage determination is unfavorable, a beneficiary has 60 days to file a written request for a redetermination by the Part D drug plan. The plan may accept oral requests. The plan must act within seven days for a standard appeal. For an expedited appeal, the plan must act within 72 hours.

Reconsideration by Individual Review Entity (IRE)
The next level of appeal is reconsideration by the Individual Review Entity (IRE). For a standard appeal, the beneficiary has 60 days to file a written request, and the IRE must act within seven days. For an expedited appeal, the IRE must act within 72 hours.

Hearing before Administrative Law Judge (ALJ)
The next level of appeal is a fair hearing. As in other administrative matters, this hearing is held before an Administrative Law Judge (ALJ). It is a quasi-judicial proceeding in which limited discovery can be taken. The hearing before an ALJ is similar to a hearing in a civil court. Typically, the judge will make a written decision shortly after taking testimony and listening to arguments.

Medicare Appeals Council Review (MAC)
After the ALJ makes a determination, there is a review by the Medicare Appeals Council Review (MAC). This council can either uphold or reverse the determination made at the fair hearing.

Federal Court
The next level of appeal is with the federal court. Pleadings must be filed shortly after the receipt of the determination of the MAC. The court will then set forth a schedule for briefing and arguments.

Grievances
Each drug plan must have a separate grievance process to address issues that are not appeals. These grievances may be filed orally or in writing within 60 days. Plans must resolve grievances within 30 days, or within 24 hours if the grievance arose from a decision not to expedite a coverage determination or redetermination.

Appeals Issues
Notice
Representatives must receive Medicare Summary Notices.

Evidentiary Issues
Medicare Part D appeals involve burdensome evidentiary standards. Providers must submit evidence at reconsideration. Beneficiaries must submit evidence at the ALJ hearing.

Timeliness and Time Frames
Compliance with timeframes depends on who is issuing the decision. The overall process is quite lengthy. There are no time frames to issue ALJ decisions in Part D cases.

Conduct of ALJ Hearings
Individuals must request the record of a pre-hearing case review and may have to pay the costs of such.

Representing a Client
An appointment of representative form must be completed and signed by the beneficiary and the representative. This form authorizes the release of identifiable health information to the representative. It also explains the purpose and scope of the representation. This form is filed with the entity processing the party’s initial determination or appeal. The appointment form is valid for one year, but it remains valid if the appeal takes longer than one year. If an individual files multiple appeals during the year, he or she must file a copy of the original form with each appeal.

Legal Fees
Below the ALJ level, legal fees are not regulated. CMS must approve legal fees for work done at the ALJ and MAC levels; however, there is no standard fee schedule. Attorneys’ fees are not paid out of the award to the client or out of the Medicare trust fund.
The Medicare Appeals process requires great detail and organization, and the ability to navigate a maze of rules and regulations. And, as each drug plan also has a separate grievance process, individuals will benefit by getting legal counsel to skillfully ensure compliance with all the steps. Begley Law Group, PC can successfully complete these processes for you so you can focus on yourself or your loved one during this critical time. To learn more, go to www.begleylawgroup.com or call 800-533-7227.

Begley Law Group, P.C.
509 South Lenola Road, Building 7
Moorestown, NJ 08057

Thomas D. Begley, III, CELA is a New Jersey elder law attorney with The Begley Law Group. To contact a New Jersey estate planning, special needs planning, or elder law attorney, call 1.800.533.7227 or visit http://www.begleylawyer.com.

April 15, 2011 in Elder Law, Estate Planning, Legal Articles, Special Needs by jferris

PART TWO: PRE-SETTLEMENT LENDING IN PERSONAL INJURY CASES

MECHANICS OF THE LOAN

Since a lawsuit itself is essentially the collateral to secure the finance company’s advances, the lending company will obtain information from the personal injury attorney concerning the case. They will follow these steps to offer the monies:

• Evaluation. The pre-settlement lending company evaluates the case and determines the likelihood of success. If the company is satisfied that there is a strong likelihood of a favorable settlement or verdict, then a cash advance will be approved.

• Agreement. The pre-settlement lending company will expect the plaintiff and the plaintiff’s attorney to sign an agreement. The agreement will require that the attorney release confidential information to the pre-settlement lending company to enable the company to make its evaluation of the request for an advance. The agreement will also require that the personal injury attorney notify the pre-settlement lending company of all settlement offers and execute an acknowledgement obligating the attorney to pay the lender directly from proceeds recovered from the suit.

USURY

Since the loan is structured as a non-recourse loan, most states have held that usury laws do not apply.

PUBLIC BENEFITS ISSUES

If the client is receiving means-tested public benefits such as SSI and/or Medicaid, does receipt of the funds pursuant to the terms of the LLA disqualify the client from means-tested public benefits such as SSI and Medicaid? If the funds are received by parents of a child under 18 receiving such benefits, do the funds received under the LLA deemed to the child so as to disqualify the child from those benefits? This becomes a tricky issue. If the funds are considered a loan and there is a reasonable expectation of repayment, then the funds are not considered income in the month received. However, funds kept into the next month will be considered a resource.[1] The issue then becomes whether the transaction is characterized by Social Security and Medicaid as a loan, subject to a reasonable expectation of repayment, or whether it is characterized as a cash advance, which is the categorization made by the pre-settlement lending company to avoid the usury statute. The lawsuit funding company contends that the transaction is non-recourse and therefore not subject to state usury laws. This is clearly an issue that needs to be taken into consideration.

BEST PRACTICES

The best practice with respect to pre-settlement lending is to refer the client to a reputable third party to perform the following:

• Identify Lender. The third party would identify the pre-settlement lender after thorough due diligence respecting reasonable rates for the industry and the lender’s reputation for honest dealing.

• Custody Funds. The loan proceeds should be custodied with the third party, who would make disbursements as appropriate.

• Recordkeeping. The third party would keep accurate and detailed records of expenditures from the loan proceeds and maintain receipts for each expenditure.

Best practices dictate that the litigation attorney engages the services of a third party to identify a reputable pre-settlement lender and supervise all aspects of the transaction.

CONCLUSION

Pre-settlement lending is appropriate if the injured person is unable to work, has reduced income, or has expenses associated with care or disability as a result of the injury. Because of the high fees associated with pre-settlement lending, it should be a last resort. Alternatives to pre-settlement lending might be:

• Personal loans from a relative
• Cash advances on a credit card
• Home equity loans
• Working with client’s creditors to forebear in collection activity until the suit is settled

The Begley Law Group, PC has counseled individuals and families on their financial and legal choices for more than 75 years. Thomas D. Begley Jr., Esquire, CELA, has extensive experience in personal injury, disability law, special needs trusts, Medicaid planning and elder law. He is a member of the New Jersey Bar Association, all relevant state and local affiliates, and the National Academy of Elder Law Attorneys.

For more information:

Begley Law Group

http://www.begleylawyer.com

509 S. Lenola Road, Building 7

Moorestown, NJ 08057
Tel: 800.533.7227

Fax: 856.273.1062

April 14, 2011 in Elder Law, Estate Planning, Legal Articles, Special Needs by jferris

PART ONE: PRE-SETTLEMENT LENDING IN PERSONAL INJURY CASES

There is an ever-growing cottage industry of investors ready, willing and able to make the equivalent of a loan to an individual who is the plaintiff in a personal injury case. These transactions, also known as pre-settlement lending, are a growing trend for those in need.  In order to avoid usury statutes, these transactions are characterized not as loans but as non-recourse cash advances. If the plaintiff loses the lawsuit, then no repayment is due. If the plaintiff receives less than the outstanding balance of the loan, then only the amount that the plaintiff receives need be repaid. Because of the high risk associated with these transactions, the equivalent of an interest rate is fairly high.

A number of issues arise in connection with these loans including legal, ethical, Medicaid and practical concerns that must be considered in determining whether applying for such a loan is appropriate.

PURPOSE OF THE LOAN

The purpose of pre-settlement lending is usually to enable the injured party and/or his family to meet their living expenses during the period of time when the lawsuit is pending.

LOANS INVOLVING MINORS AND INCAPACITATED PERSONS

If the lending agreement is made directly with the injured adult plaintiff, it is much easier than if the lending agreement is made with parents on behalf of a minor child or an incapacitated adult plaintiff whether acting as natural guardian or legally-appointed guardian of the plaintiff. In cases involving a minor or incapacitated plaintiff, many courts will refuse to enforce the terms of the lending agreement, unless it can be clearly demonstrated that the funds were used for the direct benefit of the injured minor or incapacitated person. Excellent recordkeeping is critical.

For example, if a parent misses considerable time from work superintending a catastrophically injured child and falls behind in mortgage payments, a court may question whether a pre-settlement lending agreement used by the parent to bring the mortgage payments current was for the direct benefit of the child and, therefore, enforceable. On the other hand, if the parent is the injured party, unable to work because of the injury, and assuming the pre-settlement lending was used to make mortgage payments, there should be no enforceability issue based on the fact that the “borrower” does have an interest in the lawsuit.

BORROWER’S CREDIT

In most situations involving a loan, the borrower’s credit is paramount. Even if the loan is secured by a real estate mortgage, most lenders will want to see that the borrower is credit-worthy because of today’s sensitive lending environment. In pre-settlement lending transactions, the borrower’s credit is immaterial, because the pre-settlement lending company is looking to the proceeds of the lawsuit as collateral for the loan.

The Begley Law Group, PC has assisted individuals and families with their legal and financial decisions for more than 75 years. They are highly respected for their successful track record and attention to their clients’ needs first and foremost. Thomas D. Begley Jr., Esquire and CELA, has extensive experience in personal injury, disability law, special needs trusts, Medicaid planning and elder law.

For more information:

Begley Law Group

http://www.begleylawyer.com

509 S. Lenola Road, Building 7

Moorestown, NJ 08057
Tel: 800.533.7227

Fax: 856.273.1062

April 28, 2009 in Estate Planning, Legal Articles by admin

Keeping Your Living Trusts and Estate Plans Current

The Osofsky Law firm urges clients to review their estate plans or living trusts to keep them current. Even economic conditions occurring in the U.S. can greatly alter your original intent.

Revocable “living” trusts can be a prudent estate planning device, but must be kept current. Prior to the 2001 changes in the tax law, the personal lifetime exemption from estate tax was $675,000. Couples often based their plan design on that rule. But when the exemption was increased to $3.5 million, the playing field changed. In fact, many couples had not updated their trusts to accommodate this change. “The tax landscape had been dramatically altered since many couples originally designed their trusts,” says Gene L. Osofsky, of the law firm Osofsky and Osofsky. There were other differences in those pre-2001 documents. “Many of these older trusts contained directions to split the trust estate into mandatory sub-trusts upon the death of the first spouse. This mandatory split was usually ‘tax driven’ and designed to preserve each spouse’s personal exemption, and thereby reduce or eliminate estate taxes over the span of two deaths. The ultimate goal was to transmit the maximum gift to the couple’s remainder beneficiaries, usually their children,” Osofsky explains. When the exemption amount changed, these trust provisions became archaic, or else applicable to much larger estates. Sometimes in the aftermath of the change, with an out-of-date document in hand, the surviving spouse’s access to the couple’s original assets was restricted without a corresponding tax benefit ensuing.

An admonition to draw from all this would be difficult to hear. Married couples who have created Revocable “Living” Trusts prior to 2001, as well as many who had created such documents afterwards – especially by non-attorneys and by so-called “trust mills” — would be well advised to have their trusts reviewed by a competent professional.

More recently, a severe recession has created similar issues for estate plans, to the extent that they were designed with higher asset values in mind. Trusts should also be reviewed, even if is of recent origin. While the estate tax rate is 45% under current federal law, it stands to be eliminated in 2010, then scheduled to be increased to 55% in 2011 even as the exemption will be reduced to $1 million. Says Osofsky, “While the markers are present in the political landscape to likely reinstate the taxed estate rate at 45% in 2009, while keeping the $3.5 million ceiling intact, it’s not exactly clear if this will actually happen.”

To learn more about East Bay elder law lawyers, East Bay elder law attorney, Medi-Cal planning, Medi-Cal planning lawyers and The Law Offices of Osofsky & Osofsky, visit Lawyerforseniors.com.