Remember, the purpose of a revocable trust is to avoid probate and following fact patterns make it a necessity to use a revocable trust.

  1. Owning property outside of New York State

If you own property outside of New York State in your individual name, a proceeding must be commenced in the other state to transfer or sell that property.  This means, more time and more legal fees.

  1. You have no relationship with your next of kin

Regardless of whether you have named your next of kin as beneficiaries of your estate, the probate process in New York requires that they be contacted to sign certain papers.  If they refuse, or their whereabouts are unknown, this can greatly complicate your probate proceeding.

  1. You have disabled or minor beneficiaries or heirs

A Court will generally appoint a guardian ad litem to represent the interests of a disabled or minor person.  Working with a guardian ad litem could significantly delay the administration of your estate.

  1. You are creating trusts for the lifetimes of beneficiaries

It is very common to create trusts for minor children.  It is becoming more common to create these trusts for the lifetime of the child for asset protection purposes.  If you create these trusts through a probate proceeding, you will be required to go back to Court every time there is a change, such as a change in trustee.


Notwithstanding the above fact patterns, my experience over the recent few years is that our interaction with the Court is becoming increasingly more and more complicated from an administrative perspective.  This results is time delays, legal fees and anxiety.  We are recommending, on a more frequent basis, revocable trusts.



For many families, a good portion of their wealth exists through the equity in their home.  The home may also be the most sentimental asset as it carries many memories and emotional ties.  We often counsel clients on different planning techniques to protect the home where Medicaid is contemplated to pay for nursing home or home care.  This is a review of just how Medicaid may take your home if you don’t implement some form of planning to protect your assets.


It is inevitable that we may all at some point fall victim to an illness and require care, including nursing home care or home care.  Medicaid has become the insurance of the middle class, especially in nursing home and home care cases.  


In order to be eligible for Medicaid, you cannot have more than $15,150 in assets.  When contemplating Medicaid eligibility, the home is generally treated as an exempt asset for purposes of determining whether you have less than $15,150 in resources.  However, Medicaid keeps track of those benefits and may look for them to be repaid.  


If you are a Medicaid recipient in a nursing home, a lien can be placed against your home if you are not reasonably expected to return home.  A lien allows Medicaid to recoup what they paid on your behalf when the property is sold.  Prior to placing the lien, Medicaid must provide notice to you that they intend to file a lien against your home.  If proper notice was not provided, there may be an opportunity to remove the lien.

Notwithstanding the above, Medicaid cannot place a lien against your home if any of the following persons live there:

  1. your spouse;
  2. a minor child, or a child of any age who is certified blind or disabled;
  3. a sibling who has an equity interest in the home and who was residing in the home for at least one year preceding the date you entered the nursing home.


A lien also cannot be placed against your home if you set up a Medicaid Trust and get through the 5-year look-back period.  This is why the Medicaid Trust has become such a popular planning technique.


If you are a Medicaid recipient while receiving Medicaid homecare benefits, Medicaid cannot place a lien against your home, but they can file a claim against your probate estate upon your death if no planning has been done to avoid probate.  For instance, when you die, your Will needs to be probated.  Once the Will is probated, Medicaid will send the Executor of your estate a letter demanding payment for benefits paid.  The Executor of your estate cannot ignore this otherwise they may become personally liable for the amount.  


In a recent case, an individual required home care and did not retain an elder law attorney to work through the Medicaid home care process.  Although the home was not considered an available asset, it became part of the Medicaid recipient’s probate estate when she died since no planning was done to avoid probate.  In this case, Medicaid filed a claim and the entire proceeds of sale where paid to Medicaid at the closing table.  Although she failed to plan in advance with a Medicaid Trust, this could have been avoided using a Revocable Trust to avoid probate.


Fortunately, if you take the time to consult with us, there are many options available to protect your home in advance of these unfortunate scenarios.  We regularly use Medicaid Trusts, Revocable Trusts and other planning techniques to plan in advance.  



Salvatore M. Di Costanzo is a partner with the firm of Maker, Fragale & Di Costanzo, LLP located in Rye, New York and Yorktown Heights, New York. Mr. Di Costanzo is an attorney and accountant whose main area of practice is elder law and special needs planning. He is a member of the National Academy of Elder Law Attorneys and a frequent author and lecturer on current elder law and special needs topics. Since 2013, Mr. Di Costanzo has been selected each year by the rating service, Super Lawyers as a New York Metro leading elder law attorney.  He can be reached at (914) 925-1010 or via e-mail at  Visit his practice specific website at


While most of the new tax law – the Tax Cuts and Jobs Act – has to do with reducing the corporate tax rate from 35 percent to 21 percent, some provisions relate to individual taxpayers. Before we get into the details, be aware that almost everything listed below sunsets after 2025, with the tax structure reverting to its current form in 2026 unless Congress acts between now and then. The corporate tax rate cut, however, does not sunset. Here are the highlights for our readership:

  • Estate Taxes.If you weren't worried about federal estate taxes before, you really don't need to worry now. With the federal exemption already scheduled to increase in 2018 to $5.6 million for individuals and $11.2 million for couples, the Republicans in Congress and President Trump have now nearly doubled this to $11.18 million (estimate) and $22.36 million (estimate), respectively, indexed for inflation. The tax rate for those few estates subject to taxation remains at 40 percent.

  • Tax Rates. These are slightly reduced and the brackets adjusted, with the top bracket dropping from 39.6 percent to 37 percent.

  • Standard Deduction and Personal Exemption. The standard deduction increases to $12,000 for individuals, $18,000 for heads of household and $24,000 for joint filers, all adjusted for inflation. Personal exemptions largely disappear.

  • State and Local Tax Deduction. Now referred to as “SALT,” this is now subject to a cap of $10,000,

  • Home Mortgage Interest Deduction. The limit on deducting interest on up to $1 million of mortgage interest stays in effect for existing mortgages. New mortgages taken on after December 15, 2017, are subject to a $750,000 limit. The deduction for interest on home equity loans disappears.

  • Medical Expense Deduction. After much outcry in response to the House version of the tax bill, which would have eliminated the medical expense deduction, it survived. And, in fact, it was enhanced by permitting medical expenses in excess of 7.5 percent of adjusted gross income to be deducted in 2017 and 2018, after which it reverts to the 10 percent under existing law.

  • 529 Plans. These accounts permitting tax-free accumulation of capital gains and dividends to pay college expenses can now be used for private school tuition of up to $10,000 a year.

Depending on your income and the amount of state and local taxes you have been paying, you may get a small tax cut. The bigger question is how the projected reduction in tax revenues of $1.5 trillion over the next 10 years will be paid for. This amount may simply be added to the deficit, or it may be used as a justification for “entitlement reform,” i.e., cutting Medicare, Medicaid or Social Security. It may also squeeze out other spending, such as investment in infrastructure.

The legal wing of the AARP is suing a California nursing home that refused to readmit a resident whom the nursing home had sent to the hospital. The nursing home's actions are part of growing trend of resident dumping, according to the AARP.

Gloria Single and her husband were both residents of the same nursing home. When Ms. Single, who has Alzheimer's disease, became aggressive, the nursing home sent her to the hospital for a psychological evaluation. The hospital immediately determined that nothing was wrong with Ms. Single, but the nursing home refused to readmit her.

The law treats refusing to readmit a patient after a hospital stay as an involuntary transfer that a resident may appeal. Therefore, Ms. Single asked for a hearing with the California Department of Health Care Services (DHCS), the state agency in charge of monitoring nursing homes. The DHCS ruled in her favor and ordered the nursing home to readmit her, but the nursing home refused to act on the order. As a result, Ms. Single was stuck in the hospital for three months until she was eventually placed in a different facility where she remains separated from her husband.

According to the lawsuit filed by the AARP, the nursing home felt free to disobey the DHCS's order because the state refuses to enforce readmission orders. NPR found that the state fined only 7 percent of nursing homes that were found to have illegally evicted residents and that if the nursing home was fined, the fines were relatively low. The AARP is seeking an injunction to require the nursing home to readmit Ms. Single and to stop dumping residents.

“The problem is that no state agency will take responsibility for enforcing these orders,” said Kelly Bagby of AARP Foundation Litigation in a press release about the lawsuit. “Resident dumping is a growing trend and serious danger to seniors in California. Until the State does something, our only recourse is going to be filing suits like this. Three years ago the federal government told California that it had to enforce these orders, and it has done nothing. The time has come for the State to protect its elderly citizens and stop this abusive practice.”

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