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Ins and Outs of a Business Purchase Agreement

Have you ever thought about buying a business? If you do at some point your going to be asked to sign a purchase agreement. (You will bring it to an attorney for review, correct?)

Often first time buyers or sellers are unfamiliar with what is covered in a typical purchase and sale agreement.

For most people the first time they see such a document is when they are selling their business or buying one for the first time. Like most legal documents reading them without understanding the legal significance of the words can lead to problems down the road. Too often people contact us and tell us the document “seems okay.” Maybe it is…or maybe not.

A Definitive Purchase Agreement (DPA) is a legal document is used to transfer the ownership of a company. In short, a DPA is used when two parties enter into an agreement for a merger, acquisition, divestiture, joint venture or some other form of alliance. This binding contract includes all the terms and condition under which the merger, acquisition, etc. will take place, and includes assets to be purchased, purchase considerations, representations and warranties, closing conditions and more.

There are two types of DPAs — a Share or Stock Purchase Agreement or an Asset Purchase Agreement. In a Share Purchase Agreement, the seller transfers the shares of the company into the name of the buyer. In an Asset Purchase Agreement, the individual assets are transferred to the buyer, rather than the entire company. The seller remains the owner and the buyer merges the assets into his existing company or forms a new company.

You should expect the following clauses to be included in a DPA:

Purchase Consideration — what the buyer will pay to the seller, any adjustments made to purchase price and why, timeline of payment(s), earnest money deposited in escrow, any third-party financing, required working capital, etc.

Representations and Warranties — seller states or represents the true facts about the company and then warrants that the statements are true.

Limitations of Representations and Warranties — the seller can add limitations to the representations and warranties including how long warranty period lasts (the seller won’t represent of warranty past a certain date), disclosure schedules and more.

Indemnification Clauses — this clause says that if the seller has failed to disclose a liability, he or she will pay a huge fee.

Closing Conditions — generally, there is a gap between signing and closing of deal, during which certain conditions must be met by both parties for a successful closing.

Miscellaneous Provisions — may include things like required inventory levels at time of closing, dispute resolution in case of problems, penalties to buyer or seller if deal falls apart, who pays the fees to banker, attorney, etc.

Purchase Agreements can be complicated and certainly require an experienced business attorney to help protect a your interests. Poulos Law Firm has more than 30 years of experience helping individuals navigate through these transactions.

SMALL BUSINESS LAW – We can help you with every aspect of your business including business formation and organization, business negotiations, business planning, transactional business law, purchase and sales of businesses, and business litigation, as well as succession planning with wills, trusts and buy sell agreements.

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The rise of bankruptcy in the lives of aging Americans

The golden years are turning into bankruptcy red for many retired and aging Americans. While medical advances are keeping seniors alive longer, the associated healthcare costs in the quest for longevity are being off-loaded onto the older individual at a time when reduced income is a hallmark of senior living. Older Americans are increasingly filing for consumer bankruptcy. According to the Consumer Bankruptcy Project, the population aged 65 or more are filing for bankruptcy at a two-fold increase, and there is nearly a five-fold increase in the percentage of seniors in the US bankruptcy system. The economic risk for seniors is running rampant, and the sad truth is currently 97 out of 100 people aged 65 and over are not able to write a check for $600 or more due to insufficient funds.
The sentiment among Americans is that their standard of living will increase at the age of retirement when it is quite the opposite. The typical retiree has set aside about $60,000 for their old age living, and more than 50% over the age of 55 have saved less them $50,000; as much as 40% of these workers have less than $25,000 set aside. The stark reality is none of these “nest eggs” are enough to see a senior through old age and the unforeseen disasters that can deplete what little has been saved.
One of the more common financial obstacles that create this bankruptcy scenario is a health issue. Medicare is not comprehensive. In the absence of a supplemental insurance plan picking up the non-Medicare funded 20 percent cost, a senior can be left with unforeseen operation and rehabilitation costs. Without full health care coverage, the cost of staying alive as a senior is practically prohibitive between prescriptions, treatments, surgeries, rehabilitation, and assisted care. The primary two options available to a senior to cover these costs of survival are credit card debt and loans. Suddenly, at a time when most seniors should have very low monthly living costs, they find themselves back in a debt slave scenario with little or no income to address their healthcare debt.
Many seniors have concluded that retirement is not a part of their future as they will need a viable stream of income to avoid financial disaster. While this seems reasonable, it is not a good plan to assume one will be healthy enough to work forever. As we age, there is an increased probability that working will become impossible due to unforeseen illness. When this happens, debts begin to mount, and bankruptcy becomes a likely result. Additionally, the era of stable pensions afforded to a long time employee has gone by the wayside. Fewer companies even offer them anymore and those that do often modify and reduce pension benefits to meet corporate expectations of financial profits.
The cost of living rarely if ever is reduced over time and while social security benefits seem like the answer to a senior’s retirement years; these benefits seldom cover basic living expenses no matter how long an individual may have worked or how much they paid into the system. The senior who is faced with government social security benefits and very little additional income usually turn to credit cards to address the gap between low income and living expenses. This scenario takes a senior right back to debt slave mode. As many as two out of three seniors who file for bankruptcy cite credit card debt as one of the primary reasons.
Scams that target the senior population are becoming more sophisticated and prolific with the advent of technology. What used to be a “one to one” scam can now be distributed via email to thousands of targeted seniors who are online in greater numbers than ever before. Often the unsuspecting senior will make passwords or personal bank information available to what they believe is a legitimate request for information from what appears to be a valid email. Seniors can also fall prey to predatory lenders as many seniors cannot read the fine print or understand the consequences of their actions. When scam artists victimize a senior, the senior often loses a large chunk of their assets which in turn can put them in a bankruptcy scenario.
While it is impossible to know the exact future, it is possible to make reasonable plans for it. Learn the ways that you can protect yourself from becoming part of these bankruptcy statistics in your senior years. Even a modest plan is better than no plan at all. Seek the advice of trusted legal and financial professionals to help you understand what you can do to protect your future. Please feel free to contact our office today to discuss how we can help you with your planning.
If you have any questions about creating a secure financial future for retirement years, call us today! Tel: 623-252-0292

Reasons to take your social security benefit early

Receiving your social security benefits at an earlier age will not reduce the overall amount of your benefit over time. Because you will be taking it at a younger age, your monthly payment will be smaller than if you had waited but the aggregate payout overtime will be the same amount. To see how the numbers work out use the Social Security table or Social Security detailed calculator to understand how your monthly benefit payout amount differentiates depending on when you claim your benefits.

While it is not always optimal, there are some reasons to take your social security benefit early. If the potential for program insolvency is causing you additional anxiety, then it may make sense to start taking benefits earlier than your full retirement age.. Lack of quality sleep and over anxiousness in waking hours thinking about when to take your benefit can lead to health problems.

Another reason to take your social security benefit early is if you believe your life expectancy has changed. While the longevity rate keeps increasing the more you age, it does not prevent the unfortunate diagnosis of a life-threatening disease. If your health has declined and you may not live out your statistical life expectancy, then it may be proper to claim your benefit early. Claiming your benefit earlier can give you comfort financially, physically, and mentally.

If you are a legally married woman, you can make a rational case to start taking social security benefits at the earliest possible time if your husband has been the significant wage income earner. Statistically, the wife will outlive the husband, and the spouses can share the wife’s early benefit as an income source. But if you take your benefit early, how long do you have to be married before receiving your deceased spouse’s increased benefit? The answer is, it depends. There are three types of benefits in this married spouse category: spousal, survivor, and divorced spouse. Each status has different qualification rules, and it can be complicated to decipher the best benefit available to you. It is crucial to check Social Security Administration benefits for spouses as well as a trusted legal advisor to outline your best course of action.

Deciding when to take your social security benefits involves numerous factors. A balance has to be struck between the cost of living adjustments (COLA), current expenditures and expected longevity. If we can be of assistance, please don’t hesitate to reach out.

Long Term Care and Estate Planning

It is a given that all of us are going to grow old. After the age of 65, about 75 percent of us are going to require some form of long term care. So put away the list of excuses (It won’t happen to me. The Medicaid will pay if I need LTC. I will always make my own decisions. And so many more…), because there’s a good chance it is going to happen to you.
In point of fact, Medicaid will pay for long term care, but in order to participate in Medicaid, federal law requires states to cover certain groups of individuals. Low income families, qualified pregnant women and children and individuals receiving Supplemental Security Income, as there may be options for other groups. In short, that means if your assets or income are too high, you may have to divest yourself of all assets in order to receive benefits.
So unless you fall into a low income category, you probably need to rethink how you are going to approach the long term care you might need. You should also plan for the unexpected — what if you require long term care but can no longer make your own decisions?
In fact, decisions regarding home or assets should be made five years prior to needing long term care. Wait … WHAT? How the heck can you plan that far ahead when you don’t know the date it’ll happen… use a crystal ball?
In a way, yes. An attorney experienced in estate planning can help you peer into the future and prepare well in advance of your need for long term care. The attorney might suggest steps such as purchasing long term care insurance, allocation of funds to transfer titles or deeds quickly, creating a Will or Trust, creating Powers of Attorney (both medical and financial) and many more steps.
Please feel free to call Poulos Law Firm … we will help you peer into the crystal ball and plan for your future.

Points to Discuss with Your Aging Parent

Your parent is getting on in age, but you don’t have a clear idea if there is a plan in place for their care. It is a difficult topic to broach; no one wants to talk about death and the financial realities that come with aging. Instead of having a proactive conversation early in a parent’s aging process most families have a reactive discussion under high levels of stress and emotions while their parent is experiencing an adverse health event. The Public Broadcasting Service (PBS) has reported that 85 percent of time long-term care decisions are made during a medical crisis. The message is clear, be proactive and start discussing the important financial questions with your parent.

Prepare Yourself
Your parent will be feel more comfortable and at ease if you have processed your feelings before talking to them. Conduct research so that you are knowledgeable enough to present a clear and concise set of options for your parent. Having options allows your parent and family to make decisions and feel in control of the process. You are seeking progress, not perfection. It may not all become settled in one conversation, but the price of silence about your parent’s plan may be very costly to you.

Review Documents
Two of the most critical personal legal documents are a durable power of attorney (DPOA) and a healthcare proxy. All older adults should have these documents as it gives legal authority to a designated representative to make financial, legal, and health care decisions on your parent’s behalf. If your parent does not have a DPOA and becomes incapacitated, you will have to go to court to get appointed as your parent’s guardian which can be a complicated legal process at a time when your energy is better spent in the care and decision making for your parent. If they do not have a DPOA and health care proxy in place make arrangements for them to meet with a trusted elder law attorney to properly draft the legal documents.

Often a parent will have a will, retirement account information and insurance policies that have not been revisited or updated in years, sometimes decades. When was the last time your parent reviewed beneficiary designations? Family circumstances change, and the birth of a child, death or divorce can affect how your parent may want beneficiaries designated. It is best to review financial and insurance data annually with your parent and make adjustments if necessary. For example, if the parent’s children are grown it might be best to cut back on the amount of life insurance they carry to save money on annual premiums.

Long Term Care Plan
Address the issue of long-term care. According to the PBS, a full 70 percent of all seniors will need some long-term care as they age. Even if your parent is healthy today odds are they will require long-term care and the costs are staggering. Some life insurance companies will add a long-term care rider to an existing policy. Medicaid also can cover some long-term care costs, but neither standard health insurance nor Medicare will cover your parent’s long-term care expenses.

Meet the Team
Ask your parent about their financial advisors and request a brief introduction to them. Find out who they are and how you might contact them in the event your parent is unable to do so. This information will allow you to keep an eye on your parent’s accounts and be confident the advisors are trusted, objective and well versed in elder financial issues. Oversight by you in a slightly detached way provides your parent privacy and independence about their finances but allows you to protect them from unscrupulous advisors.

Understand Filing System
The last thing you need to discuss is where this vital information is filed so that before a crisis hits you know where to find the important documents, online passwords, and forms of ID you will need to facilitate your parents well being. While you do not have to see all the specific contents of the information, particularly the financials, knowing where they keep the data is critical in a crisis. Remember that as your parent ages they may start to change the location of the information. Check with them a couple of times a year to ensure the information is still in the same place and physically look to be sure it is.

Discussing your parent’s strategy is best begun while they are healthy. Proactive planning is the best way to help your family as your parents age. Contact our office today and schedule an appointment to discuss how we can help you and your family.

Why Quitclaim Deeds Stink!

A quitclaim deed (also known as a quick claim deed) is used transfer title on real property. People on their own use them all the time and almost always create future problems. Quitclaim deeds stink, first and foremost because the deed doesn’t even say whether or not the person even owns the property and offers no guarantees as to his or her ownership interest.

Because there is no need for strong guarantees, plenty of people use them to transfer property into and out of trusts, LLCs, between husbands and wives and family members. That can be a recipe for disaster. For example, a father quitclaim’s a property to his oldest son, then dies a few months later. Upon seeing a notice in the paper, the other owner of the property shows up to claim his share. Unfortunately, the son knew nothing about another owner and now finds himself hip deep in legal problems.

Some people believe that a quitclaim is necessary if a property has lien on it. This is not true. In point of fact, a Warranty Deed and Special Warranty Deed have a “subject to” statement that says all existing claims have been disclosed, which doesn’t prevent them for being used in property transfer. A “subject to” looks something like this:

“SUBJECT TO: Current taxes and other assessments, reservations in patents and all easements, rights of way, encumbrances, liens, covenants, conditions, restrictions, obligations and liabilities that may appear of record.”

That means any liens that are publicly recorded are part of the deed. When you purchase a title insurance policy, the title company will do a search and list every commitment they find during the search.

So we’ve listed a lot of reasons why quitclaim deeds stink, but here’s the nail in the coffin. Title companies hate them! Many title companies won’t accept a quitclaim deed without additional documentation signed by the grantor. The title company has every right to question whether or not the owners actually had legal claim to the property before continuing on with the sale. Naturally, this puts a kink in the escrow process and can hold up the purchase until previous grantors (owners) have been tracked down.

In short, when in doubt, contact an experienced attorney to help you draw up a deed (Warranty Deed or Special Warranty Deed) that won’t gum up the works!

What if the plane goes down with the whole family?

Yuck what a thought! But every estate plan should address this possibility.

Most people plan to pass their assets on to the next generation … to their sons or daughters or grandchildren. However, sometimes the worst possible scenario can happen. The whole family, including the heirs to the estate, pass away in the same accident. What happens if the whole family dies in a car crash while on vacation together? How can you possibly plan for something like that? The answer is to designate a contingent beneficiary, and a good estate planning attorney will make sure you think about all the possibilities.

A remote contingent beneficiary is a party who will receive a benefit through your will or trust if a specific event of condition takes place. This is a way to have a backup plan, just in case the unthinkable happens. The remote contingent beneficiary could be a person or persons, a group or a charity.

One word of caution … you’ll need to take extra care if you have someone with special needs who could inherit. If you name them as a contingency beneficiary, you’ll want to make sure to arrange matters so that your generosity doesn’t interrupt any government benefits the person may be receiving. Imagine a scenario where Bill and Jane were both divorced and had families by previous marriages. They have now married and combined their families. Bill has a child with special needs. He has worked with an estate planning attorney to ensure that his assets won’t interrupt his child’s Medicaid benefits. However, Jane’s will simply states that her assets will go to her husband first, and then to her contingency beneficiaries — the children. If she doesn’t change her will, then the special needs child will inherit and negate the Medicaid benefits.

Don’t think that a tragedy can’t happen to you and the ones you love. A good estate plan will take into account all possibilities, even the tragic ones. Granted, the odds are likely in your favor that your heirs will inherit just as you planned, but the job of an estate planning attorney is to make sure that your Will or Trust is drafted so that things turn out the way you want.

Or you can just let the abandoned property department in your state get the money…….

Uncomfortable Questions No One Wants to Answer

Thinking about death is uncomfortable and thinking about our own death is something all of us tend to avoid with a passion. It also explains why so many people are reluctant to take on the task of estate planning. Still, there are some uncomfortable questions you do need to ask yourself before it is too late.

Here’s a list of questions to think about as you begin the estate planning process:
1. Who will raise your children if both parents die? If you haven’t named a guardian, the court will do it for you.
2. Who you look after your pets when you die?
3. What happens if you and your heirs all die in the same accident? Who will inherit your assets then?
4. Are their other descendants that may come out of the woodwork when you die? Unexpected claimants can cause all kinds of financial and emotional grief.
5. Have you named someone to look after your financial and medical matters if you become incapacitated? These are known as durable power of attorney, and don’t have to be the same person.
6. If you are incapacitated and placed on life support, when do your family to cease heroic measures to sustain your life?
7. Have you left a record of your usernames, logins, passwords and security questions to important accounts (bank, financial accounts, etc.) in a safe place where your heirs can access them?
8. Do you want to provide for children born from stored genetic material (embryos, eggs or sperm)? If so, how many years do you want to leave a window open for a birth?
9. If you are changing gender, documents that show two different sexes can cause all kinds of problems. Make sure to disclose such a change and to change all documentation.
10. Gifts over $15,000 per person per year must be reported on a federal gift tax return. Have you made any such large gifts or do you plan to make any in the future?
11. Have you ever entered into a pre- or post-nuptial agreement? Have you ever signed a community property agreement?
12. Do you have any serious or chronic health issues? Your answer may change how an estate planning attorney approaches your Will or Trust.

While these are some of the important issues to consider, every person has their own unique circumstances and concerns. An experienced estate planning attorney can help you think over all the issues and create a plan that allows you to protect your loved ones and pass on your assets in the way you want.

“I Want a Simple Will” Really?

So you say all you need is a simple Will. Are you really sure about that? If your goal is simply to pass on your assets to your heirs, you might be right.

On the other hand, if you wish to provide your loved ones with asset protection, tax protection, divorce protection or other benefits, that simple Will just won’t do the trick. For instance, if you have a child with special needs, a Will might be the worst thing you could do for that child. Simply by passing on your assets, you may disqualify the child from receiving much needed government financial support and services.

In another instance, what happens if you become incapacitated due to accident or illness. Do your loved ones know your wishes with regard to healthcare decisions or more important life sustaining measure? Do they know how the medical bills can be paid? A Will won’t provide for you, your care or help your loved ones through a trying time.

The issue should not be whether you want a simple document, it should be what are your concerns and how will you address them. The documents you need will follow from that, not the other way around.

Estate planning is the process of reviewing not only your property and deciding what to do with it when you die — it also takes into account your needs as well as the needs of your loved ones.

Depending on your circumstances and goals, you may need any or all of the following:
• Will
• Ethical Will
• Healthcare Directives
• Trust
• Powers of Attorney
• Living Will
• Guardianship for Children
• Special Needs Trusts and Planning

If you have extensive assets, you may need to go beyond traditional estate planning and look at these options:
• Gifting strategies
• Second-Generation planning
• Charitable planning
• Closely-held businesses
• Estate freezing techniques
• Dynasty Trusts
• Revocable Trusts
• Irrevocable Trusts
• Wealth replacement and asset protection

Do Not Plan or Save at Your Own Retirement Peril – Copy

A significant portion of Americans are saving nothing for retirement and very little in their day to day lives. While the unemployment rate is low and wages are seeing an increase the American worker is not saving enough of their income which will inevitably lead to short falls of operational cash during an unexpected crisis and in their retirement years further down the road. (

Bankrate maintains that half of all Americans will not be able to maintain their standard of living once they have stopped working. GoBankingRates corroborates these findings citing that over forty percent of Americans have less than $10,000 dollars saved for their retirement. These statistics point to a dismal retirement future for nearly half of all Americans. 

This doesn’t have to be your future. It doesn’t matter how little you currently save. You don’t have to become the horror story of retiring and meeting financial ruin like so many do. What matters is that you change the trajectory of your retirement life by proactively examining how you are spending and saving. The sooner you begin the better your chances of success. 

The first and most important strategy to implement is learning to live beneath your means. That translates into saving money: probably more than you currently do. Saving money is an underestimated survival skill. To save begin by tracking your spending habits for thirty days. Once you have the data create a realistic and doable budget. Fluid expenditures like groceries, eating out, clothing, gasoline and auto maintenance need to have a set monthly budget. Create a simple two columned sheet of paper with budgeted and actual expenditures to monitor your progress. Typical categories where you can reduce expenditures include; cable packages, phone plans, groceries, entertainment costs, gym memberships, clothing and dining out. Start asking yourself over and over “Is this a need or a want?” and if it is a need, how can you make the cost lower. The game is how much money you can save, not spend.

Consolidate your non essential debt and pay it off, completely. Make it a primary goal to get out of debt. Stop being a debt slave. In the credit card industry there is an insider term used for people who fully pay their credit cards off each month. Guess what it is? It is a deadbeat. Companies cannot make money off of you if you stop becoming a slave to debt. If you can’t afford it then find a way to live without it.

Double check your insurance rates on your car, homeowner, and health. Do not purchase flight insurance, extended warranties, and disease insurance. Check this site for fifteen insurance policies you don’t need. ( Get rid of the policy all together or find wiggle room for reduced premiums or get a more competitive provider to save money. 

Get rid of automatic payments attached to your banking accounts. Most people can eliminate expenditures they forgot they are even locked into. This also forces you to take control of your bill/payment cycles. Being involved in the day to day of bill payment keeps you far more aware of your financial situation and keeps your mind active.

Consider downsizing your home. If you are in a two story house it is inevitable that one day you will not be able to climb those stairs. A one story home or a first floor condo or apartment can help you purge your life of ‘stuff’ you no longer need. Some of those things can be sold and the proceeds can be saved. Any profit left over from downsizing immediately goes into savings or a financial investment vehicle to provide and protect your senior years. 

These are some but not all of the ways it is possible to change your savings habits. Guidance from a trusted professional is key to the pathway of success because there will always be roadblocks and setbacks that you must make adjustments for. Structuring a legal plan in connection with a retirement plan can provide added protection and allow you to enjoy retirement more thoroughly.

Contact our office today and schedule an appointment to discuss how we can help you with your planning. Use this link: Schedule an ElderCare Appointment

Medicare and Medicaid: Unlocking the Mystery

Medicare and Medicaid have long been a mystery to many consumers. In fact, it can baffle and confuse even some of the smartest citizens. Like me, you might have thought, “I don’t need to worry about this right now.” However, it is never too early to gain a little understanding and awareness that just might help you help an aging loved one or yourself down the road. As the saying goes, “Time flies.”, and you will be there sooner than you think. Let’s break it down and learn some of the differences and basics of Medicare and Medicaid to unlock the mystery.


Medicare is a health insurance program provided through the federal government. In order to receive Medicare, a person must meet certain requirements. A person must be 65 years old or older or have a severe disability. In order for a disabled person under the age of 65 to be eligible for Medicare, they must have received Social Security Disability Insurance (SSDI) for two years. In order to be eligible a person must have Social Security retirement benefits or Social Security disability benefits. Because Medicare is run and administered by the federal government, it is uniform from state to state. If a person meets Medicare eligibility requirements, they can receive Medicare no matter their income or assets. Costs for Medicare are based on the recipient’s work history. This means that costs are determined by the amount of time a person paid Medicare taxes. These costs like all insurance include premiums, copays, and prescriptions.

Medicare can be confusing because there are four parts. The commercials talk about Parts A, B, C, D. What does it all really mean? Parts A, B, and D can be somewhat simplified. Part A is hospital insurance, Part B is medical insurance, and Part D is prescription drug coverage. Parts A and B are covered in Original Medicare offered by the government. Part C is often called the Medicare Advantage Plan. This is a private health plan. The Medicare Advantage Plan or Medicare Part C plan are required to include the same coverage as Original Medicare but usually also include Part D as well. It is important to do your homework on these plans to find what works best and is most cost effective for you.


Medicaid is a health care assistance program. Its guidelines come from the federal government, but it is administered by each state. Medicaid is for people who cannot afford to pay for their care on their own. It is based on income and assets, and is available to people who belong to one of the eligible groups. The eligible groups are children, people with disabilities, people over age 65, pregnant women, and the parents of eligible children. Seniors who require nursing home care can qualify for Medicaid and only pay a share of their income for the nursing home. Medicaid then pays the rest.

Dual Eligibility

A person can be eligible for both Medicare and Medicaid and can have both. The two programs work together to help the recipient best cover the expenses of health care. For example, Medicare costs include premiums, copays, and deductibles. Full Medicaid benefits can cover the costs of Medicare deductibles and cover the 20% of costs not covered by Medicare. Medicaid can also help with Medicare assistance and may cover costs of premiums for Part A and/or Part B.

Although Medicaid and Medicare can be quite confusing, it is important at a minimum to know the basics. When you or someone you love is eligible or in need of the benefits, there are organizations willing to help and your elder law attorney is also a valuable resource.

If you have any questions about something you have read or would like additional information, please feel free to contact us.

How to Recognize Nursing Home Abuse or Neglect

Nursing home abuse or neglect is defined generally as any action or failure to act that causes unreasonable suffering, misery, or harm to the patient. It can include assault of a patient, but can also include withholding necessary food, medical attention, or physical care from the patient. It is important that families stay involved in the lives of their loved ones once they have been placed in a nursing home. This is the best way to prevent or recognize abuse. Below are five main categories of abuse and their warning signs.

1. Neglect – Neglect can be intentional or unintentional on the part of the nursing home facility. Neglect happens when a patient’s needs are not being met. This includes not providing appropriate food, water, medical, and personal care for the patient. This can be an intentional choice on the part of the staff or it can happen be unintentional and due to the lack of adequate staffing in a nursing home facility.

It is important to know the warning signs for neglect. A neglected patient may be dehydrated or malnourished. Bed sores and other skin conditions can be signs of neglect. A decline in personal hygiene can be a sign of personal care being neglected. Weight loss is also a sign consistent with neglect. If any of these signs are present, your loved one may be the victim of neglect.

2. Psychological Abuse – Psychological abuse in nursing homes is one type that can be very hard to identify, because it can be subtle and hard to notice. Elders feel extreme sadness, fear, and anxiety. This type of abuse occurs when there is excessive yelling, humiliating, criticizing, or shaming the patient. It might also involve threatening and intimidation of the elderly patient. Many times, psychological abuse is accompanied by other forms of abuse.

Elderly people who experience psychological abuse will often become timid and withdrawn. Depression is a sign of psychological abuse. Some victims of psychological abuse will become more angry, agitated, and aggressive. Changes in behavior are common in patients who experience this type of abuse. Due to depression, there may be sudden weight loss and loss of appetite. These patients may even refuse to eat or take medications. Since this is a difficult form of abuse to identify, it is important to be aware of these warning signs and notice any changes in your loved one’s behavior.

3. Physical Abuse – Physical abuse in nursing homes is abuse that involves physical harm of the elderly resident. It involves intentionally inflicting physical harm, such as hitting, kicking, or pinching. Physical abuse can also come from the overuse of restraints or bed injuries or from physical neglect.

Physical abuse would seem to be easier to identify, but that is not always the case. Some signs of physical abuse are hidden by clothing, or false stories of falls or stumbles. Bruises and abrasions, as well as falls, fractures, or head injuries can be signs of physical abuse. Injuries requiring emergency treatment or resulting in broken bones should be red flags to the family. Often staff in charge of an abused resident will refuse to leave when the family is present. This may be a warning sign that something negative is going on with the resident. Be present and observant when visiting a loved one in a nursing home to help ensure proper treatment and care.

4. Sexual Abuse – Sexual abuse is another form of abuse that takes place in nursing homes. This type of abuse involves any unwanted sexual attention or sexual exploitation. This can happen with any patient and is especially hard to detect in patients who are cognitively impaired or have memory loss, such as patients with dementia.

Sexual abuse can be harder to identify, but there are some warning signs. Pelvic injury or bruising in the genital and inner thigh area can be warning signs of elder sexual abuse. Newly contracted STDs is a major red flag. Sexual abuse may cause the elderly person to have unexplained difficulty standing or walking. There may also be changes in behavior or mood, including unusual sexual behavior. Be aware and take action if you see any of these warning signs in a loved one.

5. Financial Abuse – This type of abuse takes place when the caregiver takes advantage of access to the elderly person’s financial matters, and steals or compromises the victim’s finances. This can be stealing from the person or accounts, applying for credit, or incorrectly billing for services paid by Medicare or Medicaid.

If your loved one is in a nursing home facility, watch for these warning signs of financial abuse: 1) A caregiver demanding money or taking money or possessions as gifts from an elderly patient. 2) Unknown charges to credit cards or sudden mismanagement of personal finances. 3) Forcing a patient to sign financial documents or forging the person’s name on documents.

Be sure to help your loved one keep track of their finances and to know their rights.

If any of these types of abuse are suspected, it is important to ask questions of the facility and to investigate. It may also be necessary to remove your loved one from the facility. Many of these crimes go unreported. It is important to report the crime to proper authorities and to find an attorney that can help take the appropriate legal action to protect your loved one and others who could be victims of abuse.

If you have any questions about something you have read or would like additional information, please feel free to contact us.

Need Help Understanding Medicare? Here Are Tips and Resources for Assistance

For those interested in information on Medicare, understand that applying for the benefit sometimes seems like a double-edged sword. On the one hand, Medicare is obviously a good resource because it provides medical benefits to seniors who are often on a fixed income. On the other hand, however, navigating the ins and outs of Medicare can be seriously confusing, causing many to give up in exasperation. If you are a senior and in need of medical care do not despair—there are numerous resources available to help you navigate the complicated details and minutiae of Medicare.

  • Consider hiring a qualified local elder law attorney sooner than later. Their professional knowledge of the ins and outs of the Medicare system combined with their experience working with senior citizens allows you to get the help and coverage you need as quickly as possible.
  • There are multiple websites you should check out., the official site of Medicare should be a starting point, as it provides numerous facts on the program and allows you to search for providers. The Social Security Administration website also has information on Medicare eligibility and enrollment. These are just two, but you can perform an Internet search on Medicare information and you will receive a list of several sites to review.
  • If you are uncomfortable working with computers it would be in your best interests to ask a friend or relative to help you because some of the information on the internet is very valuable. However, for those who would rather talk to a person, you may call 1-800-MEDICARE (800-633-4227) for more information.
  • Another great resource is the American Association for Retired Persons, commonly known as AARP. AARP is a well-established advocate for senior citizens in the United States. The organization offers helpful, reliable resources such as Information-packed webinars featuring experts who can break down some of the Medicare facts that applicants need to know.
  • There also may be support available at the state level like State Health Insurance Assistance Programs, or SHIPs. These programs offer free counseling for seniors who receive Medicare. Medicare applicants and their loved ones should visit for more information.

But if you want to save yourself hours of confusing computer research and potential headaches, the best idea is to speak with an experienced local Elder Law attorney before the Medicare application process even begins. A good Elder law attorney can assist you with the complex process, ensuring that you get the benefits you are entitled to more quickly. If you have questions, contact a local Elder law office today.



Build a Fortress for Your Beneficiaries

The question of how to leave your assets to your beneficiaries deserves considerable thought. For instance, outright distribution to a child with special needs can interfere with government benefits your child may be receiving. What about a child you know is not financially responsible … should you give them the assets outright, stagger the distribution method or set up a lifetime fortress or dynasty trust.

Let’s take a look at all three methods…

Outright Distribution
This method is pretty straightforward … upon your death and after payment of expenses and debts, your beneficiaries receive their full share of the assets immediately. The advantages are that the assets can be folded into their own estate plans. The disadvantages may include some rather serious tax consequences depending on the size of the estate, and of course, that irresponsible child may blow through your assets with the speed of light.

The biggest issue for most families is that the kids (or their partners or spouses) will blow the inheritance in no time.

Staggered Distribution
In this scenario, you provide your child with a percentage of their inheritance at certain ages, dates or when certain events happen. For instance, when your child turns 21, they receive 1/3 of the inheritance, another 1/3 when they marry, and the final 1/3 when they reach age 40. You can also build in distributions of principal and income for things like a home down payments, educational expenses or even a monthly stipend for living expenses.

You may have seen the movie with James Garner’s move The Ultimate Gift. In this film, a deceased billionaire leaves his spoiled adult grandson a series of tasks to perform to receive his inheritance. You can structure an “incentive-based trust” along the same lines as the movie. For instance, your child will receive ½ the inheritance when he or she graduates from college and the other half when he or she retains a full-time job for at least two years.

This structure allows you to prevent a beneficiary from having too much control of inherited assets until he or she is more capable of managing them. In addition, this is a good way to protect your child and your assets if he or she is having creditor issues or is going through a divorce.

While very popular, it is not always appropriate especially when you have young children. How much do you know about who your kids will be in the future when they are very young? You don’t, so how can you make a decision about the “right age” to give a distribution?

Lifetime Fortress or Dynasty Trust
A third method of leaving assets to your beneficiaries is through a lifetime fortress or dynasty trust. In this scenario, your assets remain in trust for the beneficiary’s entire lifetime. For instance, your child could receive distributions from your trustee for health, education and living expenses. Or for more protection, you require that all activity in the trust be done in the name of the trust so that the funds never leave it. This does mean more administrative expenses, but it does provide solid asset protection. Such a plan is not for every family, but every family should at least consider it.

Special Needs Trusts
If you have a special needs beneficiary or do not plan for the possibility that special needs might arise in the future, you put public benefits for that beneficiary at substantial risk with an outright distribution. With provisions for a special or supplemental needs trust you have a particularly useful tool. You can support their needs and yet not interfere with government benefits he or she may be receiving.

Whatever method you choose you should start by discussing all options with an experienced estate planning attorney. Each method has pros and cons that should be carefully weighed to meet your goals for your family, and also meet the needs of your beneficiaries.

That Joint Ownership Thing May not be Good Estate Planning?

Should you do it?
Not really.

Historically, joint ownership of property has been a popular estate planning tool. Adding a partner, child or close friend as a joint owner on one or more of your assets does have advantages. The survivor automatically becomes the owner of the property, so no need to change title or administer the assets through the estate. It can be a smooth and simple passing of assets. In addition, a child or friend can step in easily and beginning managing your property and finances.

Naturally, many married couples hold joint assets like bank accounts, property and other financial assets. But this tool is being used more and more frequently between parents and children. Among other things, the objective is to minimize or avoid probate fees. However, there are some pitfalls you should know about.

Tax Consequences
When you add a joint owner to your assets it is considered a gift. If it is more than 14,000 per year, then you are required to report that “gift” to the IRS. When a joint owner (other than a spouse) dies, the tax law treats him or her as owning 100% of the value of the jointly held property, and includes the entire amount in his or her estate to determine whether estate taxes will be due. As soon as the property changes hands, it triggers any unrealized capital gains and results in immediate tax (property can only be rolled over tax-free to a spouse).

Control Disputes
Once you become a joint owner, you are now at the mercy of the joint owner(s). Disputes can arise over any aspect … bank accounts, maintenance, payment of expenses, receipt of income, sale of property and more. A joint owner might even be able to force a sale of the property by using the courts to resolve differences.

This is a big one when it comes to kids. Joint ownership can expose a property to claims by the joint owner(s) personal or business creditors or a spouse seeking alimony during a divorce. For example, let’s assume you add a daughter as a joint owner of the property. She gets into financial trouble and you suddenly find creditors are coming after that jointly held property. They will get it.

Lack of Control
If a joint owner becomes incapacitated and is incapable of making decisions, you cannot automatically step in a do so even though many people think you can. You now have to work with the appointed joint owner’s attorney or guardian of their property. That person may have a legal obligation to liquidate a non-productive asset, no matter what you want.

No Complex Tax or Succession Planning
Joint ownership may skirt around probate, but it also prevents more efficient tax and succession planning that works much better.

Forfeit Tax Benefits
When you die owning appreciated property, your heirs receive one of the most important benefits in the whole tax code, called a “stepped up basis” in the property. For example, if you bought your house for $250,000 and it is worth $350,000 when you die, then your children will inherit the property from you at its “stepped up” basis ($350,000, the value on your date of death). If they later sell the property for $350,000, then, the $100,000 worth of capital gain just disappears. Unfortunately, lifetime gifts don’t get a “stepped up” basis. Instead, those lifetime gifts pass your basis in the property to the recipient (called a “carryover basis”). So, using the same example, if you’ve added a child to your Deed as a joint owner, then he or she will receive your $250,000 basis in the property, and when the property is later sold for $350,000, there will be taxable gain of $100,000 on the sale.

Other Options
Fortunately, there are other estate planning options that can provide you with the same conveniences as joint ownership, without the tax issues and other risks. Please call me to talk about the options.