Running a small business can keep you busy, but it should not keep you from creating an estate plan. Not having an estate plan in place can cause problems for your small business and your family after you are gone.  

While an estate plan is important for everyone, estate plans are especially important for small business owners. Estate planning allows you to dictate what will happen with your small business after you die or are no longer able to manage it. It can help you avoid excess taxes and debts and facilitate your business’s continued success. 

Before sitting down to start the estate planning process, you should think about your goals for your small business. What do you want to have happen if you die or become incapacitated? Should the business continue with current partners or be sold to new owners? Should your family take over? Should the business be shut down? Consider your family dynamics when thinking about these questions. Once you have come up with your goals, you can create a plan to meet them. 

The basic building blocks of any estate plan include a will, power of attorney, and medical directives. The will allows you to direct who will receive your property at your death while the power of attorney and medical directives dictate who can act in your place for financial and health care purposes. 

Following are some additional things a small business owner should consider as part of an estate plan: 

• Tax Planning. If your business is not a separate entity, you may want to consider ways to minimize estate taxes. The current estate tax exemption ($12.06 million in 2022) is so high that most estates do not pay any estate tax. However, a small business could put an estate over the limit. Also, the fact that the estate tax exemption is set to be cut in half in 2026 and that states have their own estate taxes means that tax planning is important. You may want to put your business assets into a trust or a separate business entity like a limited liability company to lower your estate tax burden. 
• Trust. A trust can be useful not only to reduce estate taxes, but also to ensure the continued running of your business if you die or become incapacitated. Because a trust passes outside of probate, the assets in the trust can be transferred immediately to the person you want to run the business without waiting for the whole estate to go through probate. In addition, if you become incapacitated, the trustee can continue to run your business without court involvement. 
• Buy-Sell Agreement. If you own your business with others, a buy-sell agreement can be very useful. Buy-sell agreements are used if one of the owners dies, leaves the company, or becomes incapacitated. It specifies who can buy an owner’s share of the business, under what conditions, and for what price. 
• Life Insurance. When you own a business, life insurance takes on new importance. A life insurance policy can ensure that your family continues to receive an income in the event of your death. It can also provide funds to keep the business running and be used to fund a buy-sell agreement.

Your estate planning attorney can help you come up with a plan to meet the needs of your business. To find an attorney near you, click here.

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ABLE (Achieving a Better Life Experience) accounts offer people with disabilities a great, tax-free way to accumulate money without jeopardizing their qualifications for Supplemental Security Income (SSI) and other means-tested programs. Withdrawals are tax-free as long as the money is used for ABLE “qualified disability expenses accounts.”  The arguments for starting and maintaining such funds are overwhelming, not least of which is the wide variety of things on which the money can be spent.

To build 529A ABLE accounts, beneficiaries (and other contributors) can put up to $16,000 total into these funds each year. Other restrictions apply. Only those whose disabilities were diagnosed before turning 26 are eligible for an ABLE savings plan.  The total value of the account must remain below $100,000 for the beneficiary to qualify for government benefits. Also, the money must be spent only on items, services and activities that the Internal Revenue Service (IRS) deems qualified disability expenses (QDEs).

The ABLE Act, passed by Congress in 2014, originally defined ABLE qualified disability expenses as:

• education, housing, transportation
• employment training and support
• assistive technology and personal support services
• health, prevention, and wellness
• financial management and administrative services
• legal fees
• expenses for oversight and monitoring
• funeral and burial expenses

The language of the Act concludes this list with: “and other expenses which are approved by the Secretary under regulations and consistent with the purposes of this section.”

Subsequent regulations and recent revisions by the Social Security Administration (SSA) and the IRS have expanded the list. As of 2022, for instance, the SSA has determined that food qualifies as an ABLE qualified disability expense, whether in the form of groceries or restaurant meals. ABLE money can also go toward vacations.

To clarify the purpose of ABLE accounts, the Treasury Department and IRS issued a bulletin in 2015 to the effect that “ABLE qualifying disability expenses” should be “broadly construed” to include any benefit related to the designated beneficiary “in maintaining or improving his or her health, independence, or quality of life.”

“There is no complete list of ABLE qualified disability expenses, but the category is very broad, including any expense paid for the benefit of the eligible beneficiary,” Juliana Crist, senior consultant at AKF Consulting, an advisor to state-run municipal plans, told Investopedia.

The ABLE National Resource Center offers advice on what to spend ABLE funds on and when, stressing that an expenditure need not be disability related. Need a car? That’s eligible, as is a smartphone. As noted above, education qualifies, as does anything needed for classes, such as books and a laptop.

It is always best to use ABLE funds on those things that are explicitly described as qualified disability expenses, while using money from other sources for those things that might not qualify. The ABLE National Resource Center advises using public benefits for key expenditures, reserving ABLE funds for those things less likely to be covered by such things as Medicaid. Experts advise keeping records on what you have spent ABLE funds, should the IRS decide to include you on one of its random audits. Misuse of ABLE account funds could result in tax penalties and possible loss of public benefits.

But the rationale for starting and building an ABLE account is compelling — and keeping the account growing more so, as more items are included in allowable expenditures. Before you open an ABLE account for yourself or a family member with disabilities, or if you have questions on how the money should be spent, be sure to contact attorney Stephen Elville and the attorneys at Elville and Associates.  As experienced special needs planners, they will be able to advise you regarding how an ABLE account may fit in with a full estate plan that includes special needs considerations, always with the ideals of client education, collaboration and compassion in mind.  To schedule your free consultation, please contact Executive Assistant Mary Kramer at mary@elvilleassociats.com, or at 443-741-3635, or click here.  

For a directory of state ABLE account programs, click here.

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The decision to pursue guardianship – to obtain the legal authority to make decisions for another person – is one that has many intricacies to it and should not be taken lightly. There are also many alternatives to guardianship to consider as well, which is why speaking with a qualified attorney is extremely important during the decision making process and throughout the guardianship proceeding. Elville and Associates’ Managing Principal and Lead Attorney Stephen R. Elville offers this webinar presentation about “Guardianship and the Alternatives: What Parents, Family Members, and Advisors Need to Know.” Topics of discussion include: – What is guardianship? – What are the benefits and drawbacks? – What are the main questions every family should ask before making the decision to pursue guardianship? – What are some of the alternatives to guardianship?

More Webinars from Elville and Associates

The education of clients and their families through counseling and superior legal-technical knowledge is the mission of Elville and Associates.  We hold multiple educational events every month. Click to view our calendar of educational webinars and events or visit the Elville and Associates YouTube channel to view recordings of our past webinars.

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Identity theft occurs when someone uses another’s personal identifying information, like their name, social security number or credit card number, to commit fraud or theft. Identity theft is one of the fastest growing crimes in the United States. A 2021 Javeline Strategy study estimates Americans lost a total of $56 billion dollars in Identity Theft scams. These alarming statistics demonstrate identity theft may be the most frequent, costly and pervasive crime in the United States. This presentation will cover the various types of identity theft, to include child ID theft, medical ID theft, tax ID theft and data breaches. The ease of accessing our personal information online and through public information resources will also be discussed. Your presenter is Mr. Andre Lingham, Founder and President for the Center of Elder Justice and Education and a distinguished retired Howard County Police Officer. The Center of Elder Justice and Education was established in 2021 and is a non-profit organization that promotes elder abuse awareness and education. Their mission is done by virtual and in person training to senior citizens, the general public, government agencies, police departments and private institutions. Andre previously served over 30 years in law enforcement and retired from the Howard County Police Department in 2019 to focus full time on elder abuse awareness and education. While a member of the Howard County Police Department, he served as the Senior Citizen Liaison for 5 years. In 2014, Andre was named Howard Police Officer of the Year and 2015 American Legion Law Enforcement Officer of the Year for his work educating and protecting seniors

More Webinars from Elville and Associates

The education of clients and their families through counseling and superior legal-technical knowledge is the mission of Elville and Associates.  We hold multiple educational events every month. Click to view our calendar of educational webinars and events or visit the Elville and Associates YouTube channel to view recordings of our past webinars.

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It is estimated that seniors are scammed out of $36 billion dollars per year in financial exploitation. Such exploitation occurs whenever older adults are deprived of their property by improper means. This commonly includes fraud, theft or deceptive behavior. Often the perpetrator of this behavior is a family member, caregiver, or someone who has a relationship of trust with the older adult. This presentation will cover the various types of financial exploitation, scams and frauds that target seniors and the best ways to minimize being victimized. Case studies and interviews with victims are included in the presentation. Your presenter is Mr. Andre Lingham, Founder and President for the Center of Elder Justice and Education and a distinguished retired Howard County Police Officer. The Center of Elder Justice and Education was established in 2021 and is a non-profit organization that promotes elder abuse awareness and education. Their mission is done by virtual and in person training to senior citizens, the general public, government agencies, police departments and private institutions. Andre previously served over 30 years in law enforcement and retired from the Howard County Police Department in 2019 to focus full time on elder abuse awareness and education. While a member of the Howard County Police Department, he served as the Senior Citizen Liaison for 5 years. In 2014, Andre was named Howard Police Officer of the Year and 2015 American Legion Law Enforcement Officer of the Year for his work educating and protecting seniors This webinar is offered in partnership with the Howard County Library System, a longtime supporter of Elville and Associates’ educational programs. To learn more about the HCLS, its educational programs and calendar of events, please visit https://live-howardcounty.pantheonsit… or contact Ms. Rohini Gupta, Adult Curriculum Specialist, at rohini.gupta@hclibrary.org. #elvilleeducation #elvillewebinarseries

More Webinars from Elville and Associates

The education of clients and their families through counseling and superior legal-technical knowledge is the mission of Elville and Associates.  We hold multiple educational events every month. Click to view our calendar of educational webinars and events or visit the Elville and Associates YouTube channel to view recordings of our past webinars.

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Elville and Associates’ Managing Principal and Lead Attorney Stephen Elville offers this webinar discussion about the very important topic of how to select a Trustee. Choosing a Trustee is one of the most intensive pieces of the estate planning process, and a choice not to be taken lightly. Ensure you’re educated about all the factors that go into making this important decision. Points of emphasis include: – What is a Trustee and what are their responsibilities? – Types of Trustees and their characteristics – advantages and disadvantages – The perfect Trustee – setting the benchmark for selection – Trustee selection – why is it so important? – Trustee succession and plan design – why so difficult, why so crucial? – Trustee roles in Wills and Trusts – What are some reasons to consider appointing a Corporate Trustee? – Why should you be concerned about “Successor Trustee risk”? #elvilleeducation #elvillewebinarseries

More Webinars from Elville and Associates

The education of clients and their families through counseling and superior legal-technical knowledge is the mission of Elville and Associates.  We hold multiple educational events every month. Click to view our calendar of educational webinars and events or visit the Elville and Associates YouTube channel to view recordings of our past webinars.

#elvilleeducation #elvillewebinarseries

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Authored by: Stephen R. Elville – Managing Principal and Lead Attorney – Elville and Associates, P.C.

March is National Developmental Disabilities Awareness Month!  Elville and Associates is very privileged and honored to work with persons with disabilities and their families, and to be a part of the disability and special needs community for the past twelve years.  It is an essential and important part of our Mission to continue to educate individuals, families, advocates, and professional advisors, and to promote awareness and legislative action for the benefit of persons with disabilities in Maryland and beyond.  Along these lines, Elville and Associates strongly encourages the Maryland General Assembly to pass SB 559/HB 529 – Supported Decision Making – into law this legislative session.  For more information about special needs planning and National Developmental Disabilities Awareness Month, please contact Stephen R. Elville at steve@elvilleassociates.com, or Jeffrey Stauffer at jeff@elvilleassociates.com.

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View Elville and Associates new introductory video here!

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Medicaid applicants must prove that they have limited income and assets in order to be eligible for long-term care services. Before beginning the Medicaid application process, it is helpful to understand what information you will be required to provide to prove your eligibility. 

Medicaid is a state-run program, so the rules can vary from state to state, but in general applicants are not eligible for Medicaid benefits if the applicant’s income exceeds $2,523 a month (for 2022). Applicants can also have no more than $2,000 in assets in most states.  

States require Medicaid applicants to provide the necessary information to prove that they are eligible for benefits. The burden of proof is on the Medicaid applicant—not on the state. In addition to needing to provide identifying information such as a birth certificate and proof of citizenship during a Medicaid application, following are some of the documents that you may have to provide to the Medicaid agency when you apply for benefits:

• Proof of income. A copy of any pay stubs, Social Security statements, and/or pension checks; income tax returns for the past five years; and verification of any other sources of income, for example, rental income or dividends. 
• Bank records. Copies of bank statements for the past five years. 
• Property. A copy of the deed to any property owned within the past five years and a copy of the most recent property tax bill. 
• Retirement accounts. Statements for the past five years of retirement accounts. 
• Insurance. Copies of any insurance policies, including health insurance, life insurance, and/or long-term care insurance.
• Car registration. Registration information for any cars owned by you. 
• Burial arrangements. Copies of any prepaid funeral contracts or deeds to burial plots.

The state may use an electronic database to verify some of the information during your Medicaid application. Intentionally giving false information is a serious offense. 

The state looks back five years to determine whether you transferred assets for less than market value within five years of your Medicaid application. Applicants who gave away assets may be subject to a period of ineligibility. 

Not all assets will be counted against you for the purposes of Medicaid eligibility. Personal possessions, one vehicle, your principal residence, and prepaid funeral plans are “noncountable” assets. However, the state will likely still request information about these assets. 

After you begin receiving benefits, you are not done. Medicaid reviews your income and assets every year to ensure that you are still eligible. This could involve electronic verification or submitting more documentation. 

The Medicaid application process is complicated, and submitting an application without an attorney’s help, particularly if you are applying for nursing home benefits, is not a good idea.  The process generally takes several months as Medicaid keeps asking questions and demanding further documentation for the answers provided. 

Before applying, contact the elder law attorneys at Elville and Associates who are well-versed in the Medicaid application process.  They will counsel and guide you every step of the way through the process and ensure no stone is unturned.  Click here to set a time to speak with one of Elville and Associates’ elder law attorneys. 

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Watch our firm’s introductory video here!

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Do you get upset, angry, or cry easily? Tips are here!

How often do you feel like crying?

Do you cry or get upset with the slightest provocation?

Do things that were manageable before now seem overwhelming?

How is your stress level?

Can you handle one more piece of bad news?

If you find these questions challenging (or you think I’ve been spying on you), please know you are not alone.  Throughout the globe mental health has taken a hard hit.  There are many indicators that each person has struggled more than usual in the past two years.

Managing Your Emotions with Sleep

One of the key factors of managing your emotions is good deep sleep.  Sleep, anxiety, and pain are closely linked.  Anxiety makes pain feel worse.  Pain and anxiety both make it difficult to sleep.  Poor sleep makes it difficult to manage anxiety or pain.  Sleep is where I have seen the most people break this difficult cycle.

And rarely is medication the way to achieve that kind of restorative sleep.  Sleep medications alter the types and depth of sleep you get so rarely do medications, alcohol, or other substances help you feel truly rested in the morning.

So, what can you do?  There are several steps you can take for more natural effective sleep.  These are often called sleep hygiene.  Consider which of these you could add or improve.

Better Sleep Techniques

1. Keep your sleep and wake times as regular as you can. I know this can be difficult but if you can, avoid wide variations.
2. Leave the screens behind. Ideally stop looking at screens an hour or more before going to bed.  And keep them away from your bed.  If you need the alarm, use the feature that will keep it silent until time for the alarm.
3. Have a wind-down routine. Let your brain and your body know you are getting ready to sleep. 
4. Make sure to get good movement during the day to differentiate awake from sleep times. Time outdoors and in nature can lower stress, anxiety, irritability, and blood pressure.  It can increase endorphins and dopamine to help you feel more positive.
5. Do what you find relaxing. A warm bath or shower, gentle stretching, soft music, lavender or other scents you like, and other relaxation techniques can help you calm and relax.
6. Use sounds to diminish distraction from a snoring partner or other noises. You can search online for white noise, pink noise, brown noise, rain sounds, ocean sounds, or nature sounds. 
7. Quiet your mind. One way to do this is deep breathing slowly in and out.  Either count slowly in through your nose and out through pursed lips (as if around a straw) or recite a favorite quote or verse while breathing.  You can also look for many options for meditation.
8. Avoid or minimize length of naps. Too much sleeping during the day will disrupt sleep at night.
9. Keep your bed for only sleep and sex. Watching television or studying in bed then trying to sleep can minimize your chances to fall asleep easily and get good sleep.
10. If you wake up during the night or have trouble getting to sleep, go back to the breathing to help quiet your mind. If pain is keeping you awake, try gentle stretching then go back to bed.

Use whatever combinations of strategies that work best for you.  Of course, another key factor is to get enough sleep.  I know several successful people who deprive themselves of sleep in order to obtain a few more hours to work.  On rare occasion when up against a big deadline, that is not so detrimental (unless you are driving tired.).  Otherwise, this has many long-term negative health effects. Too little sleep increases risk of high blood pressure, heart attack, and stroke among other effects. 

Next Steps

Controlling your emotions is just one of many positive benefits to taking time and effort to sleep better. 

If you would like to know more:

Retirement Wellness Strategies is an exclusive one-on-one process with a professional expert guide. (www.retirewellness.com) 

Propel Comprehensive Wellness is a self-guided online monthly subscription way to gain the tools you need to thrive for a lifetime. (www.propelyourwellness.com) 

Unsure?  Schedule a time for us to talk: https://calendly.com/retirewellness/20-minute-free-inquiry-call

Dr. Michellle Fritsch is an author, nationally renowned speaker, and founder of Retirement Wellness Strategies. You can call her at 410-472-5078, email her at michell@retirementwellness. com, or visit her website at www. retirewellness.com.

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Serving as a trustee of a trust can be a huge responsibility, so trustees are entitled to compensation for their work. The amount of trustee compensation depends on the type of trustee and the complexity of the trust. 

Depending on the trust, a trustee’s duties can include managing trust assets, making distributions to beneficiaries, paying taxes, and creating an annual report of all income and distributions. Performing these tasks can involve a lot of work, so it makes sense that trustees are compensated for their time. 

The terms of the trust may explain exactly what trustee compensation is appropriate, but many trusts don’t provide specifics. With no guidance from the trust document, the laws in most states usually require that trustee compensation be “reasonable,” without giving more details. What is considered reasonable is going to depend on the type of trust. Things to consider include the following:

• The amount of time needed to administer the trust.
• The complexity of the trust. 
• How many beneficiaries are involved. 
• What type of assets need to be managed. 

Often family members and friends serve as trustees without trustee compensation. If their duties are modest — simply distributing trust assets, for example — that might be fine. 

With a more complicated trust, however, some trustee compensation is expected. Professionals usually charge an annual fee of between 1 percent to 2 percent of assets in the trust. So, for example, the annual fee for a trust holding $1 million could be between $10,000 and $20,000. Often, professionals charge a higher percentage of smaller trusts and a lower percentage of larger trusts. 

A non-professional trustee usually charges less than a professional. However, if the non-professional trustee is doing all of the work for a trust, including investments, distributions and accounting, it may be appropriate to charge a similar fee. On the other hand, if the non-professional trustee is paying others to perform these functions or is acting as co-trustee with a professional trustee, charging this much may be seen as inappropriate. A typical fee might be a quarter of what the professional trustee charges, or .25 percent (often referred to by financial professionals as 25 basis points). If taking a percentage of the trust assets would deplete the trust, non-professional trustees may also charge an hourly rate for their work. 

In addition to compensation for their work, trustees are also entitled to reimbursement for any expenses that they might incur in the course of performing their duties, including travel, storage, insurance, or taxes. 

If the beneficiaries are unhappy with the trustee compensation received, they can challenge it in court. And if trustees think they are entitled to more trustee compensation, they can also appeal to court to receive higher payment. 

Whether you are setting up a trust or have been appointed trustee and want to know what trustee compensation is reasonable, consult with the estate planning attorney at Elville and Associates.  Our attorneys are well-versed in addressing all matters involving trustees, including choosing the right one for your situation, counseling trustees regarding their duties and responsibilities, as well as acting as trustee in certain situations.  To set a time to speak with an attorney about this subject, please contact the firm’s Executive Assistant, Mary Guay Kramer, at mary@elvilleassociates.com, or at 443-741-3635.  Or, you may fill out a contact form online and we’ll respond to you promptly.

To view Elville and Associates most recent webinar titled, “Trustee Selection – How to Choose the Right One for You” please click here.   

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Watch our firm’s introductory video here!

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