In this issue of “Ask the Expert”, Michigan estate planning attorney, Esther Acosta lists 3 real estate planning mistakes you should avoid.
Your home and other real estate likely represents a significant portion of your overall estate. The way you go about passing it on to your loved ones can mean the difference between leaving a valuable inheritance or a costly, frustrating mess. Here are the three biggest estate-planning mistakes you must avoid with regard to real estate.
1. Probate Avoidance – Don’t Go Down the Probate “Rabbit Hole.” Michigan probate is a needlessly expensive, frustrating, and time-consuming process that can easily last a year or more. If your home is subject to probate, your heirs will have to make tax payments, mortgage payments, and cover the cost of maintenance until the probate is completed. With proper planning, probate can be avoided.
2. Don’t Fall Victim to the “Give and Take” of Medicaid Estate Recovery. In Michigan, people who receive Medicaid assistance to cover the cost of nursing home care are subject to what is known as estate recovery. This means that Medicaid is entitled to recoup whatever it pays out for nursing home care after the recipient passes away. Medicaid can even place a lien on the family home to recover its nursing home payments. Again, this can be avoided through proper planning.
3. Don’t Make Uncle Sam Your Primary Beneficiary—Instead, Minimize Capital Gains Taxes.Timing is the key to minimizing the taxes your heirs must pay on appreciated property such as your home. Improper planning can cause your loved ones to inherit a home that is subject to a substantial capital gains tax when it is sold.
I invite you to learn more about how to protect your home while you are alive from creditors, predators and nursing home care and after you are gone. Click here to register for my free estate planning workshop on August 22. Light refreshments will be served and all attendees are entitled to a complimentary consultation! I hope to see you there.
About Estate Planning Attorney, Esther Acosta
Attorney Esther Acosta is the founder of Acosta Law Firm, PLLC, where she focuses on estate planning, asset protection, elder law and Medicaid planning. A distinguished speaker, Esther Acosta offers seminars and workshops to educate and empower individuals, not only to understand the foundations of estate planning but also to appreciate the value of being prepared. She helps each client gain peace of mind by ensuring their children will be taken care of as they would want, their assets will be protected, and they themselves will be adequately cared for in a crisis.