Potential for Social Security Benefits after Divorce

Although you are divorced, you may be surprised to know that you still may be entitled to receive social security benefits on your former spouse’s work record. Even if your former spouse has remarried! However, if you have remarried, you normally cannot collect benefits on your former spouse’s record unless your subsequent marriage ends. According to the Social Security Administration, you can receive benefits if:

• Your marriage lasted 10 years or more;
• You are 62 years of age or older;
• You are unmarried;
• Your former spouse is entitled to Social Security retirement or disability benefits; and
• The benefits that you are entitled to receive based on your own work record are less than the benefits you would receive based on former spouse’s record.

What if your former spouse hasn’t applied for benefits?

If your former spouse has not applied for benefits, you still may receive benefits on his or her record if (1) your former spouse qualifies for them, and (2) you’ve been divorced for at least two years.

What if you are eligible for benefits?

If you’re eligible for benefits, Social Security will pay that amount first. However, if your former spouse qualifies for a greater amount, you will receive a combination of benefits equivalent to the greater amount (reduced by age). If you have reached full retirement age and you qualify for a former spouse’s benefit and your own benefit, you will have a choice to receive only the former spouse’s benefits and delay receiving retirement benefits until later.

What if your former spouse is now deceased?

If your former spouse has died, you may still be able to receive benefits just as a widow or widower would. Your marriage to the worker must have lasted 10 years or more. If you care for a child who is (1) under 16 or is disabled and (2) is getting benefits on your former spouse’s record, the length of the marriage doesn’t matter. The child must be a natural child of your former spouse or legally adopted by your former spouse.

Two Documents Your College-Bound Student Should Have

If you are about to send a child off to college, please consider having them sign a Durable Power of Attorney and a Health Care Power of Attorney before they go. Without them, if your child is 18, you don’t have any authority to make health care decisions for them, or manage their money, if something happens to them. Once they are 18 they are adults under Michigan law. Without a Durable Power of Attorney or Health Care Power of Attorney, you can find yourself in probate court if they have an accident and need your help.

We would be pleased to meet with you and your child in order to have these important documents prepared. Or, alternatively, they can order them from us online at EstatePlansDitect.com.

Supreme Court Rules Inherited IRA Not Protected In Bankruptcy

The U.S. Supreme Court recently ruled that inherited IRAs are not protected in bankruptcy.

Although this ruling does not affect your own IRAs (your retirement funds are still protected if you file for bankruptcy) it will cause problems for any child who inherits an IRA from you and files for bankruptcy. The Court has ruled that the inherited IRA will not be protected from the child’s creditors.

New Department of Veterans Affairs Accreditation

I am pleased to report that as of February 24, I am now an accredited attorney for the preparation, presentation, and prosecution of claims for veteran’s benefits before the Department of Veterans Affairs (VA). If you are the surviving spouse of a veteran, and in need financial assistance, please call and set a time for us to get together to see if veteran’s benefits might be available to you.

Don’t Just Plan for Disability – Avoid It!

Chronic illness… it’s a major cause of disability for seniors, and can be a retirement dream-killer. Travel. Golf. A retirement home in the country. It sidelines daily passions. Walks. Painting. Knitting. Crossword puzzles. Playing on the floor with grandchildren.

One way you can help yourself live a “disability-free” or “disability-reduced” life in your senior years is exercise in midlife. A recent study reported in the Archives of Internal Medicine indicates that being physically fit in midlife (over 50) may do many important things for us not just now, but down the road. Being physically fit can:

  • prevent some seniors from ever developing chronic conditions;
  • let other seniors live longer while healthy before developing chronic illness.

The study also shows that midlife fitness may actually shrink the number of years seniors spend coping with chronic illness altogether. It may help us live better and longer, more healthy years and fewer sick ones.

So what can you do to help avoid disability? Start exercising. Of course, you should consult your physician before getting started, especially if you have any known medical issues. If you already have a regular exercise routine, the study suggests that increasing the intensity of your workout can help even more. If you usually go for a walk, try going for a jog instead. Stay on the treadmill a little longer. Put in a little more effort now and reap the benefits later on.

Can Someone Access to Your Google Account After Your Death?

One of the growing challenges with estate planning is how to handle digital assets (i.e. e-mail accounts, facebook® accounts, etc.) in your plan. This can be particularly troublesome in settling the estate if you have bank statements or financial account statements electronically sent to your e-mail address without a mailed paper copy. Without the ability to access your e-mail account, your Personal Representative or Trustee might not even know that you have the bank or financial accounts.

Unfortunately, Michigan’s probate code does not give your Personal Representative or Trustee authority to access your e-mail account after your death. And, historically, service providers such as Yahoo® refuse to give password information to someone other than you per their Terms of Service.

If you have a Google® account, however, you are in luck. You now have the ability to set up your Google® Inactive Account Manager. By setting up your Inactive Account Manager, you can designated someone to access to your Google® account if you have not logged in after a designated period of time.

To set up Inactive Account Manager, login to your Google® account, and then go to: https://www.google.com/settings/account, which will take you to your Google® account set-up page. Select Data Tools from the top menu, and then go to set-up Inactive Account Manager.

Through your Inactive Account Manager, you will be able to set the timeout period, after which your account will be treated as in active, and designate trusted contacts who are to be notified if your timeout period expires. You can, also, give them access to your Google® account. Optionally, you can instruct Google® to delete the account once the timeout period expires.

Hopefully, other online service providers will follow Google®’s lead in giving users the ability to provide others with access to their accounts in the event of their death. Meanwhile, if you have a Google® account, then be sure to set up your Inactive Account Manager. And, if you don’t have a Google® account, perhaps this would be a reason to consider setting one up.

Help Prevent Post-Mortem Identity Theft

The National Funeral Directors Association recommends notifying the following when someone dies to help avoid post-mortem identity theft:

– Social Security Administration
– Veteran’s Administration (if the decedent formerly served in the military)
– Defense Finance and Accounting Service (military service retiree receiving benefits)- =Office of – – — Personnel Management (if the decedent is a former federal civil service employee)
– U.S. Citizen and Immigration Service (If the decedent was not a U.S. citizen)
– State Department of Motor Vehicles (If the decedent had a driver’s license)
– Credit card and merchant card companies
– Banks, savings and loan associations and credit unions
– Mortgage companies and lenders
– Financial planners and stock brokers
– Pension providers
– Life insurers and annuity companies
– Health, medical and dental insurers
– Disability insurers
– Automotive insurer
– Mutual benefit companies
– All three credit reporting agencies: Experian, Equifax, and TransUnion
– Any memberships held by the decedent (ex: health clubs, professional associations, clubs, library etc.)

Use a Qualified Personal Residence Trust to Avoid Federal Estate Tax

A qualified personal residence trust (“QPRT”) is a special type of trust that can be used to avoid or minimize Federal Estate Taxes. The QPRT is used to remove the value of your personal residence from your estate, thereby reducing the size of your estate that is subject to Federal Estate Tax.

With the QPRT, you create an irrevocable trust, and convey ownership of your personal residence to the Trust. However you, also, reserve the right to live in the residence for a specified period of time. When the time expires, the residence is transferred to the beneficiaries you have named in the Trust. Under the right circumstances, using the QPRT can result in significant Federal Estate Tax savings for your estate, while ultimately transferring your residence to your heirs.

When coupled with an appropriate long-term lease arrangement that kicks in when the residence transfers to your heirs, you can, even, keep the right to continue living in the residence even after the QPRT ends.

When Does Your Durable Power of Attorney Become Effective?

A Durable Power of Attorney can be drafted to become effective upon signing, or only if you become incapacitated. If drafted to become effective upon signing, your named agent can immediately take charge of your assets. If, on the other-hand, you only want your Agent to be able to take charge of your assets upon your incapacity, then be sure to have your DPOA drafted to only become effective upon your incapacity.