Author: Michael Baron

When a Testamentary Trust in Your Will Makes Sense

Dear Michael: We are ‘in between’ parents in that we have some older children – not interested in farming – and we have some younger children of which one or two might be interested in farming. They are still in middle school, however, so it’s hard to say what direction they may go. We don’t have a will at this point in time. We kind of thought we knew how life was going to go, but the older children surprised us by not wanting to farm. The younger children are much more involved in FFA and other agriculture pursuits...

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Couple Asks What Happens to Their Assets if They Die Without a Will

Dear Michael: We’ve talked about putting together an estate plan for years now, but the kids keep changing their minds, we keep putting it off, something else always comes up, etc. Mostly, we just don’t know where to begin on the process and don’t know what we don’t know. What are the laws if one of us or both of us die without having a will? – No Plan – No Plan Dear No Plan: Well, that’s a very simple question with a very complicated answer based on you and your husband and your children and whether or not...

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Don’t Complain With Your Mouth Full

Mr. Baron: In your last column, you were advising a couple how to get on Medicaid? This couple had sold their farm to their son. What happened to the money? Why didn’t they buy nursing home insurance with it? How much did taxpayers already subsidize the farm operation when they were farming? I would suggest this couple, their children and you should be ashamed of themselves. – Tommy Stiles, Henning, MN Dear Mr. Stiles: When people write to me and ask me what are the rules of Medicaid, I tell them what the rules are. Nothing more and nothing less. It’s like when you go to your CPA for your taxes and he tells you about dependent deductions, home interest deductions, etc. Or do you prefer to pay the full amount and not take any deductions as the law allows? Are you ashamed for following the law? I explained to them what the law allows, as per Medicaid guidelines and as the laws are written to this point in time. It’s not up to me to judge other people’s actions. I merely explain the rules. I don’t advocate anything. Second, when the son bought the place, he bought it on a contract for deed. Most people – in lieu of receiving rent – sell their farms to their children. However, without rent, the obvious answer to your question of...

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Could Joint Tenancy With Right Of Survivorship be an Alternative to a Living Trust?

Dear Michael: We’ve been farming for many years. We were talking to friends and they mentioned they have a living trust to handle their estate planning. We’ve checked into various trusts – is this the one that protects our estate from long-term care costs? Signed, Is the Answer a Living Trust?   Dear ‘Is the Answer a Living Trust’: In its simplest terms, a living trust is another way for you and your husband to own property together. You have sole ownership – if one of you owns the property. You are allowed to pass your property to whomever you desire during your lifetime. However, if you are married, your spouse may have ‘spousal rights’ to the property upon your death, even if you direct it to someone else. Each state has their own laws regarding ‘spousal rights’. You have joint tenancy with right of survivorship (JTWROS) as another option. This type of ownership means there are two owners and the ‘survivor’ will automatically inherit the property from the first owner’s death. It doesn’t matter what your will states to the contrary, the property is now owned by the survivor. Why? Because JTWROS states there are two owners and upon death, the one who died is removed from the deed. People use this type of ownership all the time to pass property between spouses so they don’t incur probate...

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When Non-Farming Children Think Their “Share” is Unfair

Dear Michael: We have two sons who have been farming with us for the past twenty-five plus years and we have three children who left as soon as they could to go on to successful careers. We are approaching our seventies and wanted to set up our estate so the boys on the farm got the farm – via a life estate to protect it from long-term care costs – and the kids off the farm received the other assets as well as a cash payment from the two boys on the farm. We brought up our plans to...

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