Trusts and Estates Blog

Keep an Eye on Medicaid/Medi-Cal Developments

Senior couple on cycle rideMedicaid is a program that affects millions of Americans. (California renamed its Medicaid program “Medi-Cal”). Originally established to help elderly citizens cover medical costs, the program has grown exponentially and is a large cost to many states. Since the federal government only pays 57% of the total costs of the Medicaid program, individual states are required to supplement additional funding for the program.

The Medicaid program is one of the largest line items on many state budgets. In fact, 20% of Texas’ massive budget is dedicated to paying for the Medicaid program. Due to the increased strain of the program on states, many states are considering pulling out of the Medicaid program (states such as Nevada, South Carolina, Texas, Washington, and Wyoming).

Increasing that strain on states are new mandates in the recently passed health care reform bill. Beginning in 2014, states are expected to expand Medicaid coverage to all non-elderly citizens who have family incomes below 136% of the federal poverty level. For the first three years, the government will subsidize the cost of expansion, but beginning in 2017, states will be expected to take over financing of the expanded program.

Already struggling through the recent economic drought, many states are breaking under the financial strain of the Medicaid program. Many states (with both Republican and Democratic governors) don’t feel they will be able to contribute the required additional dollars to fund the expanded program.

The stated goal of those states considering withdrawal from the program is to replace Medicaid and its mandates with a state-level program that are more flexible and employ stricter eligibility criteria.

Since Medicaid is the primary source of payment for nursing home care and some private care, these changes have the potential to affect many Americans currently receiving care. Should your state withdraw from the Medicaid program or employ a new system, Medicaid care will become unavailable for you or your loved ones and planning for future care will become more difficult.

Keep an eye on these developments in your state. There’s no guarantee your state will withdraw from the program, but as you plan your long-term care, you must be aware of such changes.

If you would like more information concerning Medi-Cal for long term care, contact Antelope Valley law firm Thompson Von Tungeln (TVT) at 661-945-5868 or visit their websites at and is a comprehensive online resource for personal wealth management solutions through wills and revocable trusts. is a comprehensive online resource for long term nursing home care for the middle class. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve clients with the creative, effective and custom solutions they demand.

Planning for the Worst (Why does your car have air bags?)

familywithdogNo one wants to think of the “what-ifs” in life. Worrying about the future never helped anyone, but planning for the future is something every person should think about. Especially as an elderly person, planning becomes a vital preface to assure you and your loved ones will be taken care of in the case of any medical emergency.

Consider this situation: Betty, a 70-year-old lady was stuck with the task of caring for her family’s finances when her husband, the long-time financier, suffered a stroke that left him impaired. She was confused, frustrated, and fearful. She had never been taught how to care for their finances and suddenly found herself in uncharted waters.

Those circumstances happen all too often. Rather than waiting for a medical emergency to begin preparations, take time now to make arrangements for the day when you can’t handle your own financial or legal matters. Here are a few ways to plan for that time of your life:

Gather important documents. While it’s nearly impossible to prepare for every emergency situation, gathering vital documents and keeping them in a secure location will help you point people to them if you are impaired. Documents like your birth certificate, Social Security card, bank statements, tax records, and a document of passwords and account numbers. Here are some other documents you should consider gathering:

• birthplace and birth date
• education and military records
• names of employers and dates of employment
• full legal name
• legal residence
• location of living will
• location(s) of birth, death, marriage, divorce, and citizenship, and adoption certificates
• prescribed medications and other regularly taken vitamins, medications, and supplements
• group memberships and awards received
• names and phone numbers of close friends, spouse, children, relatives, attorney, financial advisor, doctors, and religious contacts
• Social Security number
• Financial Records
• copy of most recent tax return
• credit and debit card names and numbers
• insurance information (life, health, long-term care, home, car) with policy numbers and agents’ names and phone numbers
• investment income (stocks, bonds, property) and stockbrokers’ names and phone numbers
• liabilities, including property tax (what is owed, to whom, when payments are due)
• location of most recently updated will with an original signature
• location of original deed of trust for home and car title and registration
• location of safe deposit box and key
• mortgages and debts (when and how they’re paid)
• names of your bank(s) and account number(s) (checking, savings, credit union)
• Social Security and Medicare information; sources of income and assets (retirement funds, IRAs, 401(k)s, interest, etc.)

Keep these items in a home safe, bank deposit box, or let your lawyer store them for you.

Keep a trusted person involved. Having the documents gathered and in one place is step one, but it does not good if no one knows where the items are. Find a trustworthy friend, family member, or even your lawyer to tell of the location of the items should anything happen. You don’t have to divulge your private information to them; simply let them know the location and how to retrieve the documents.

Make legal preparations. Certain legal documents can help you allocate power of your estate, medical decisions, and legal issues to a trusted person before you lose the ability to make such decisions yourself. Talk to your lawyer about setting up a living will (make arrangements for yourself ahead of time) or a durable power of attorney (appoint someone to make the decisions for you).

While medical emergencies can be a fearful time, make sure that your loved ones aren’t burdened with caring for your estate without direction. Begin planning for such a situation today.

If you would like more information concerning Veterans Benefits, Medi-Cal, or estate planning, visit today. is a comprehensive online resource for VA benefits, elder law, estate planning and related issues. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve clients with the creative, effective and custom solutions they demand.

Summary of Living Trust Benefits

* Avoids probate at death, including multiple probates if you own property in other states
* Prevents court control of assets at incapacity
* Brings all your assets together under one plan
* Provides maximum privacy
* Quicker distribution of assets to beneficiaries
* Assets can remain in trust until you want beneficiaries to inherit
* Can reduce or eliminate estate taxes
* Inexpensive, easy to set up and maintain
* Can be changed or cancelled at any time
* Difficult to contest
* Prevents court control of minors’ inheritances
* Can protect dependents with special needs
* Prevents unintentional disinheriting and other problems of joint ownership
* Professional management with corporate trustee
* Peace of mind

©1989-2010 by Schumacher Publishing, Inc.

Lancaster – Palmdale – Santa Clarita – Estate Tax Planning

Although California has no estate tax, the federal estate tax bite can be substantial enough to justify careful planning for estate tax liabilities. The larger your estate, the more carefully you must plan and choose from many options, depending on your specific circumstances and objectives.

For experienced and insightful advice and custom estate plans that will help you meet your wealth preservation and asset transfer goals while minimizing or avoiding estate tax liability, contact the Antelope Valley estate tax planning attorneys at Thompson Von Tungeln, A P.C. , in Lancaster. Our estate plan solutions may involve any of the following approaches to cut your future tax liability down to size:

* Use of revocable living trusts and irrevocable life insurance trusts to transfer assets out of your estate while maintaining control and beneficial use
* Qualified personal residence trusts , especially where your primary residence represents a significant asset within a larger net worth profile
* A/B bypass trusts, dynasty trusts, and generation skipping trusts to avoid and manage the complications presented by California community property law
* Charitable remainder trusts , charitable lead trusts, or gifts
* Community property agreements, prenuptial agreements, and postnuptial agreements

There are essentially two main approaches to managing estate tax liability: transferring assets out of your estate through trusts or gifts, and maximizing the value of your federal estate tax exemptions. Some of the instruments described above emphasize only one approach, while several cover both. What’s right for you will depend upon your broader estate planning goals, the characteristics of your family, and the nature and value of the particular assets you hold.

An important feature of sound estate tax planning is integrating tax management strategies into a broader estate plan without overwhelming or distorting it. Unintended and unfortunate consequences–such as the disinheritance of one’s own children –can result from too close a focus on tax planning without sufficient attention to your other wealth transfer objectives.

Understanding Living Trusts: Doesn’t joint ownership avoid probate?

Not really. Using joint ownership usually just postpones probate. With most jointly owned assets, when one owner dies, full ownership does transfer to the surviving owner without probate. But if that owner dies without adding a new joint owner, or if both owners die at the same time, the asset must be probated before it can go to the heirs.

Watch out for other problems. When you add a co-owner, you lose control. Your chances of being named in a lawsuit and of losing the asset to a creditor are increased. There could be gift and/or income tax problems. And since a will does not control most jointly owned assets, you could disinherit your family.

With some assets, especially real estate, all owners must sign to sell or refinance. So if a co-owner becomes incapacitated, you could find yourself with a new “co-owner” — the court–even if the incapacitated owner is your spouse.

The Special Needs Trust: Planning for a Disabled Dependent

If you have a child, sibling, parent, spouse, or other loved one who is physically, mentally or developmentally disabled — whether from birth, illness, injury or drug abuse — he or she may be entitled to valuable government benefits (SSI and/or Medicaid) now or in the future. Unfortunately, most of these benefits are available only to those with very limited means.

As a result, you may find yourself faced with a difficult choice. If you leave a substantial inheritance to this person, he will be disqualified from receiving government benefits which may be crucial for his care. On the other hand, you may not want to have to disinherit him in order to preserve these benefits.

Fortunately, a special needs trust will keep you from having to make this wrenching decision.

A special needs trust must be very specific in stating that its purpose is to supplement government benefits, to provide only benefits or luxuries above and beyond the benefits the beneficiary (disabled person) receives from any local, state, federal or private agencies.
It is critical that the trust not duplicate any government-provided services and that the beneficiary not have any resemblance of ownership of the trust assets. Otherwise, the government could attempt to seize the trust assets for repayment of services already provided or determine that the beneficiary does not qualify for future benefits.

To accomplish this, you will need to give the trustee complete control over the distribution of the assets and any income they generate; the beneficiary cannot be able to demand any principal or interest from the trust.

Give careful consideration to your choice for trustee. Of course, you (and your spouse) will continue to provide for this person while you are alive and able. But someone will need to assume this responsibility after your death or incapacity.

The most obvious choice is another family member who also cares deeply about this person. But be aware of a possible conflict of interest, especially if she will inherit the trust assets after your disabled dependent has died; she may care more about preserving trust assets than providing for your beneficiary.

Consider using (or adding) a corporate trustee; that’s a bank or trust company that specializes in managing trusts. They can be impartial, and they will be around for as long as your beneficiary lives.

Finally, be sure to work closely with an attorney who has considerable experience with these trusts.

Antelope Valley Estate Planning Law Firm Offers Seminar on Pending Changes to Medi-Cal and How they Affect Long-Term Care Planning

Antelope Valley estate planning law firm Thompson Von Tungeln is offering a November 12 seminar on the upcoming changes to Medi-Cal and how those changes will affect your long-term care planning.

Lancaster, CA (PRWEB) November 6, 2009 — Antelope Valley estate planning law firm Thompson Von Tungeln is offering a complimentary seminar on the changes to the Medi-Cal program and how those changes can affect long-term care planning.

“Long-term care planning is an intricate process,” said Kevin Von Tungeln, partner at Thompson Von Tungeln. “Compliance with the changes to Medi-Cal is akin to a chess games with draconian penalties if you make a mistake. That is why consumers need to be informed of the changes and have expert legal counsel guiding them through the process.”

The changes to Medi-Cal, the California Medicaid program, are centered on the ability to give away assets such as a home or financial instruments, and changes regarding annuities. Many individuals have established planning strategies to give away assets that will need adjusting.

“Anyone living today has a greater than 50 percent chance of needing long-term care when he or she reaches age 65,” said Von Tungeln. “At least 70 percent of persons over 65 will require long-term care at some point in their lives. Being knowledgeable about the new rules and planning accordingly can save you, your spouse and your heirs a great deal of trouble in the future.”

The seminar is on Thursday, November 12 at the Hilton Garden Inn in Palmdale. Registration is requested due to limited seating. To register for the complimentary seminar, call 661.945.5868.

About Kevin Von Tungeln
With more than 18 years’ legal experience, Kevin L. Von Tungeln serves Thompson Von Tungeln in the areas of estate planning, probate, trusts, wills, trust administration, conservatorships, guardianships and elder law. He is certified by the State Bar of California Board of Legal Specialists as a Board Certified Specialist in Estate Planning. Get to know more about Kevin’s approach to estate planning by viewing his informational videos at: Kevin can also be found at LinkedIn by going to: (

About Thompson Von Tungeln
Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their website at

Mentally disabled seniors suffer in group home prison camp

SAN BERNARDINO, Calif. (KABC) — Authorities in San Bernardino uncovered what are described as prison camp conditions at a group home. Investigators say seniors, some mentally disabled, were abused, crammed into chicken coops and forced to go to the bathroom in buckets.

Authorities say the facility was an illegal adult group home that was not licensed by the city or the state.

The home owner, 61-year-old Pensri Sophar Dalton, was arrested Friday. She’s accused of forcing mentally ill adults to live in prison camp-like conditions; housing them in converted chicken coops with razor wire fences surrounding the facility and padlocked gates.

City Attorney James Penman says 22 people were living in three dilapidated buildings – none of them with indoor plumbing. He says residents used buckets as toilets.

“The house has been converted. We believe there may be some illegal conversions in the bedrooms. People were living in rooms as small as 6 to 15 feet, two beds and a mattress to the room,” said Penman.

He says the conditions were amongst the worst he’s ever seen.

Dalton was charged with 16 counts of causing harm to elderly adults. She was booked at the West Valley Detention Center, where she remains in custody.

“I was wondering if that’s illegal or not ‘cuz that comes over on our property too and it’s razor wire like they use in prisons,” said Kevin Milner, a neighbor.
The facility has been shut down. A city attorney investigator says most of the 22 residents were picked up by family members or taken to licensed care facilities.

Watch the video here:

How can we make sure this doesn’t happen to us or our parents?

(1) Make sure an estate plan is in place, and that the plan names who will take care us or our loved ones if incapacity strikes.

(2) Make sure the person given the authority to determine where you or your loved one lives is the correct person to do the job. Making sure the right person is: (a) paying your bills; and (b) determining where you live is the most important decision you will make regarding your estate plan. Don’t pick a child just because they are your child, and don’t pick a neighbor just because they are your neighbor. Watch closely how a person conducts their own affairs and how they treat other people. If the person you want to pick doesn’t treat others with respect, odds are they won’t treat you well, especially if you are incapacitated.

(3) Finally, consult a competent attorney to review your selections with you. An attorney who specializes in this area will be able to give you their experience and wisdom on picking the right person so that you don’t end up living in a chicken coop when you can’t speak for yourself.

No Contest Clauses in Wills – When a Creditor Files a Claim

A no contest clause traditionally consists of specific language included in a California will or trust that attempts to prevent any legal dispute against the will after the testator has deceased. A no contest clause, for the most part, does help to discourage legal disputes over a will, except in cases for which the contesting party can offer significant proof of forgery, duress, or problems with validity of the instrument. For most no contest clauses, the language specifically states that any beneficiary of the will stands to be disinherited should he or she decide to pursue unjustifiable litigation in dispute over some aspect of the provisions of the will.

There are, however, certain exclusions to the enforcement of no contest clauses, including among others, when a creditor files a claim against the estate of the testator. Unless the language of the no contest clause specifically includes the circumstances of a creditor filing a claim, the act of doing so would be considered an exclusion to the clause, and therefore, a legitimate reason for a beneficiary to file a dispute without running the risk of losing his or her inheritance.

Many California wills now include standard no contest clauses that include specific language relating to when a creditor files a claim against the estate after the testator has deceased. If so, the validity of such a clause might still be brought into question, and recent California legislation has paved the way for making the entire no contest clause invalid, regardless of the language included within it.

Since the new legislation will not go into effect until 2010, and although the bill will be retroactive for California wills that are currently being drawn up, it is still a good idea to include a no contest clause within your will that includes language relating to when a creditor files a claim against your estate. In this case, a little defense is better than no defense at all, and your estate has a better chance of being legally protected (at least, for a short time) with such a clause.

If you have additional questions concerning no contest clauses, or the California legislation changes surrounding them, a qualified California estate lawyer will be able to give you the best advice concerning the inclusion of a no contest clause in your estate planning options. A highly skilled California estate attorney, with experience in litigating no contest clauses in California, can offer you educated solutions to all of your estate planning needs.

Kevin Von Tungeln is the Managing Partner of and Thompson Von Tungeln, P.C. Kevin practices in the areas of estate planning, probate, wills, and trust administration. Visit or

The FDIC and Living Trusts – When You Have More Than Five Beneficiaries

In a press release sent by the Federal Deposit Insurance Corporation (FDIC), as of September 26, 2008, new rules apply to deposit accounts held in revocable trusts or living trusts, as well as payable-on-death accounts. These new rules are an attempt to simplify FDIC guidelines and promote consumer and investor confidence in our nation’s banking industry.

In short, where the FDIC once only insured beneficiaries of revocable trusts who qualified under FDIC guidelines (namely, the account owner’s spouse, children, grandchildren, parents, or sibling), the new and interim rule applies to any beneficiary named in the trust, including distant relatives, friends and charities.

Additionally, the insured amount on accounts held in living trusts is based on the number of beneficiaries. Thus, under the new limits secured by the Emergency Economic Stabilization Act of 2008, each beneficiary of the trust is insured for up to $250,000-as long as there are five or fewer beneficiaries named in the trust.

If there are more than five beneficiaries named in the trust, the FDIC’s new and temporary insurance limits are as follows:

- Revocable trust account owners who have more than $1,250,000 in a trust-owned account, and have named more than five beneficiaries are covered by the FDIC at the greater amount of either $1,250,000 or the sum of all the beneficiaries’ interest in the trust (limited to $250,000 per beneficiary).

- If the sum of the revocable trust account is less than $1,250,000 and there are more than five beneficiaries, each beneficiary is covered up to $250,000 per beneficiary, and according to each beneficiary’s stake in the trust.

Estate planning techniques constantly change to keep pace with changes in the law, and new legislation has made it even more appealing for people to set up revocable trusts or living trusts for their loved ones.

In situations such as the current economic downturn, having accounts owned by revocable trusts held in FDIC insured banks adds an extra level of security to your savings. You can rest assured knowing that your named beneficiaries will receive their inheritance even in the event of a bank collapse.

That kind of reassurance is worth every penny spent on a quality estate plan drafted by an experienced and specialized attorney. The government is making it safer for anyone wishing to further their estate planning goals to take full advantage of all the benefits a living trust can offer.

Whether your estate planning goals are immediate or long-term, a qualified California estate planning attorney will be able to counsel you on the best options available to you to meet your individual needs.

Kevin Von Tungeln is the Managing Partner of and Thompson Von Tungeln, P.C. Kevin practices in the areas of estate planning, probate, wills, and trust administration. Visit or

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