Wills and Trusts

I suppose you could do it yourself, but, would you really want to trust something you found on the internet to protect your assets and provide for your family if you died suddenly?

The VI is well known for its archaic probate laws in which many estates have been in limbo for decades.

My wife and I have trusts prepared by an attorney here. The docs are over an inch thick.

Good luck!

I don't know what your goals are or your family structure.

However, the best way for your heirs to avoid costly probate is for you to re-deed real estate using a transfer on death or beneficiary deed. This type of deed is legal in the VI. 

Should I Get a Transfer on Death (TOD) Deed in 2023? (yahoo.com)

Then on bank accounts and such, name your beneficiaries on the appropriate forms usually available online.

Everything else you own - even vehicles - are just junk. Unless your heirs are contentious they can haggle and split your stuff.  Someone can step up and get power of attorney as executor once you're gone. 

Spend your $$ on making it easy for everybody with death transfers.

Wills go through probate (yikes can you imagine this in the VI) and trusts are about you trying to manage from the grave (you're dead so let posterity figure it out).

FYI my mother did us the favor of using TOD deeds.  

@gators_mom Wow...great information GatorsMom!

I didn't know about TOD deeds!

@gators_mom 

Does anyone know if they are available in the VI?

In the yahoo article link it says:

Transfer on death deeds are not available in every state. Eligibility also depends on the state where the property is located, not where the owner or beneficiary resides.

Currently, TOD deeds (or similar alternatives) are offered in 27 states and the District of Columbia: Alaska, Arizona, Arkansas, California, Colorado, Hawaii, Illinois, Indiana, Kansas, Minnesota, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Texas, Virginia, Washington, West Virginia, Wisconsin and Wyoming. (In Michigan, a Lady Bird deed offers similar benefits.)

TOD's are available in Maine as well.  And they're available in the V.I.  I don't like them.  I can give you a TOD today and change it an unlimited amount of times before I die.  And it won't prevent counting that property as "available" if someone ever needs Medicaid or long term care benefits when nursing home care can run $15,000 a month.  What about distributing retirement plans?  You can't fund a retirement plan to a trust outright, but you can make the trust a beneficiary if properly drafted.  There are only a few attorneys in the VI that truly understand a revocable living trust, much less asset protection trusts, charitable remainder trusts, charitable lead trusts, irrevocable trusts, etc., etc.  And it's quite funny how often I see a Trust without a pour-over will.  What was never funded to your Trust will go through probate intestate administration.  That means the Government decides who gets what and how its divided. That's close to malpractice.  And, of course, the people that say "I have a trust" but the trust was never funded with anything, so, legally, there is no trust.  Nothing held by the Trustee "in trust."  

The silly part is someone wanting to protect hundreds of thousands in real property and assets (or more), avoid $20K to $30K in probate cost, but who would seem to prefer to "fill in the blank."  Go for it!  But everyone is different.  Every family is different and every plan is different.  But it won't matter.  You'll be gone when the "fill in the blank" trust is administered.  

Posted by: @northsidekevin

But it won't matter.  You'll be gone when the "fill in the blank" trust is administered.  

Yes, I'm most definitely not planning to expire in the VI.

That applies in any jurisdiction.  My old man's plan is simple.  He says he's going to die at home.  Fine, says I, just do it outside on the porch please.  He's 92 and has enough firewood to go "at least another couple winters."  

The V.I. Probate Code, Title 15, is a word for word copy of a 1950's New York Surrogate Court Code.  It costs WAY too much to probate a Will here and takes years.  DeJongh had a bill in around 2010 to update the Code to the Uniform Probate Code.  It passed.  For some reason, "someone" didn't like it.  It didn't "suit" somebody, and it was bizarrely withdrawn and dropped back to the old code.  I'd surmise if it had remained in effect it would have saved V.I. residents tens of millions of dollars to date had it stayed in effect.  

Yes transfer on death deeds are legal in the VI. I believe the legislation that approved this occurred in 2019 or 2020. 

It's not about who you give your property to - they may not know. It's about your desire to pass your property on without your heirs getting caught up in probate. Many trusts are also revocable.

If you're trying to get Medicaid and avoid having your property taken by said agency after death - good luck with that.  Your saving is meant to support you in your dodderage. If your heirs get something great, if they don't great too.

I have named beneficiaries on my retirement plans and bank accounts. Why would you want to entangle these already complex assets in a trust? BTW - retirement plans are inherited with the deferred taxes still owed. You can gift IRAs to charities without the charities incurring the owed deferred taxes though.

I know we settled my mother estate using transfer on death deeds and designated beneficiaries on her bank and investment accounts. Never went to probate. Her executor settled everything (that's the person you need to be concerned about). 

The "typical" Trust is revocable.  And Congress provided tools in the Medicaid program to allow parents to pass a legacy on to their heirs.  Intentionally.  It's a morass of strategies akin to corporate tax planning, but it works.  I know many, many people that have had such "luck" in the hundreds of thousands of dollars.  One primary key is the 5 year lookback period for gifts.  Go the full 5 years (and into the month following the 5 year anniversary) and not counted.  The "gift" (such as the family residence) goes into an appropriate irrevocable trust.  Don't go the 5 years and a "penalty period" is levied.  Who has "savings" to cover 3 years of long term care at $12,000 and up a month and going up every year?  There's something approaching $500,000.00 gone right there.  Designated beneficiaries apply to investment accounts.  TOD applies to deposit accounts (checking, savings).  By naming a revocable trust as the surviving beneficiary (appropriately structured) you get the 10 year stretch after death.  Only rollover beneficiaries (like a spouse) get their actuarial life payout.  The difference is NOT paying up to 40% taxes when someone passes away leaving a retirement account.

TOD deeds are fine if someone never needs nursing home care. Don't get your advice (or forms) from the internet.  Go talk to an attorney that does primarily estate planning.  

You spend your assets for end of life care if you're lucky enough to live that long.

Medicaid is only available at certain nursing homes - the "nicer" nursing care facilities and all ALFs will not accept Medicaid patients. 

Many facilities that accept Medicaid have limited bed availability.

Not just assets - but monthly income is looked at to be disqualified from Medicaid.

So .... if you're counting on grandma or grandpa getting cared for by Medicaid think twice. That's the latest specialty niche in estate planning LOL.

I've been down this road with my mother and an aunt. You pay cash for care if you care for your loved one. 

My advice comes from personal experience. Medicaid is not meant for most of us. Our families may not inherit anything once the cash is spent out on acceptable care. That's how it works in modern day America.

You're absolutely, completely wrong.  In many states an SNF bed is an SNF and assisted living facilities are included under Medicaid.  The facilities that won't accept Medicaid are in the small minority.  Um, I've practiced medicaid planning for 20 years Stateside and it's not the "latest niche."  We help people that need it.  But you win if it makes you feel better.

Again, don't get your advice from bulletin boards or the internet.  

Transfer on death deeds on real estate and designating beneficiaries on bank/investment accounts keeps these assets out of probate. Thus, out of the reach of Medicaid liens - that occur only if an estate goes to probate.

Trust me, you have to be destitute  to end up in most Medicaid nursing facilities. At least the ones I know of ....

Posted by: @northsidekevin

You're absolutely, completely wrong.  In many states an SNF bed is an SNF and assisted living facilities are included under Medicaid.  The facilities that won't accept Medicaid are in the small minority.  Um, I've practiced medicaid planning for 20 years Stateside and it's not the "latest niche."  We help people that need it.  But you win if it makes you feel better.

Again, don't get your advice from bulletin boards or the internet.  

No ALFS are not Medicaid facilities at least in FL or MO or KS where I have lived.

My mother and my family have used an attorney to help us plan for the inevitable and in particular avoid probate costs and hangups.

There was not a single Medicaid nursing home bed available for my aunt in KS or MO near family. No winning here just very sad personal experiences. My aunt died in 2022. My mother in 2020. 

We spent the cash and would do it again - and I'm sure we will.  

@gators_mom Nope.  Medicaid, which is administered by State agencies, varies from State to State in application.  Under Federal law, those agencies have to collect any Medicaid paid to anyone over 55 years of age.  The State agencies search records, including Registries of Deeds, and collect from those assets.  The TOD does nothing to preclude Medicaid Estate Recovery.  In fact, that TOD, even if done 10 years earlier, could be changed right up to the date of death.  Transferred to someone else.  Or the property sold.  The lien is automatic (like an IRS lien) and doesn't have to be recorded.  As such, it comes into play when the application for Medicaid Benefits is made.  The applicant could have sold the property before applying for Medicaid and used the money to pay for care.  Therefore it is deemed "available."  Failure to disclose the TOD would be Federal Program Fraud under 18 USC Section 666.  The agencies typically run the names online in registries of deeds and usually catch the TOD in any event.  

Trust me, 70 to 75% of the people in Nursing facilities in most jurisdictions are on Medicaid.  They didn't go in there broke.  The nursing home took everything.  It's called a "spend down" and Congress gave applicants multiple ways to plan to "spend down".  From automobiles to certain financial instruments called "Medicaid Compliant Annuities." It's a complex system.  A bed is a bed in most New England facilities.  Worst case scenario is a shared room.  No difference in services.  And you know, at least in one State I'm familiar with, I don't know of any SNF (skilled nursing facility) that doesn't accept Medicaid.  But it may be true from what I've read - the last place in the world I'd want to go is anywhere in the SE or central U.S.  

But DON'T get your advice from the internet, this thread or anywhere but from someone qualified, much less the "fill in the blank" form discussion that started this thread.  I've saved families hundreds of thousands of dollars when they desperately needed it.  I suppose it's akin to a billionaire paying $0.00 in taxes or maybe $750 a year.  No idea how it works in the V.I. with the screwy block grant system.  I suspect most of their Medicaid money is spent on medical.  

But you really shouldn't tell people TOD deeds are the be-all end-all.  They ain't.  

If you have significant assets (not simply cash and financial instruments) get an attorney.  This is not something you want to ignore if you care about what happens after you pass.  We’re in our late 60’s, with three children and have worked our plans and documentation over a period of several years.  It’s actually not that expensive, just make sure you do your research on which attorney to hire.  My wife and I started with conversations between ourselves on what we felt the outcome should look like, then worked with our attorney (as well as listening to his advice) and our financial advisor to structure the half dozen wills, trusts and proxy’s we have. Finely we sat with our kids and gave them a rough outline of our intentions, including designating one child as our “personal representative” (the new term for executor), once we’re both gone.  The better the planning and communication the better the chances of minimizing any family conflict after both parents have passed. 

Currently having a living trust and will done using upwork. Some are around $35-50/hr, so pretty inexpensive and they are paralegals that can make sure it’s done right. The lady im using is $50/hr and its only taken her a couple hours. https://www.upwork.com/hire/trusts-estates-and-wills-freelancers/florida-us/

As long as you don't have significant assets, I suppose, and you're aware any trust is meaningless without appropriate funding.  The SECURE ACT and it's update(s) can severely affect naming your Trust as an alternative to beneficiary designations on individual retirement plans.  Of course, you get what you pay for.  

Posted by: @beachbumlife

Currently having a living trust and will done using upwork. Some are around $35-50/hr, so pretty inexpensive and they are paralegals that can make sure it’s done right. The lady im using is $50/hr and its only taken her a couple hours. https://www.upwork.com/hire/trusts-estates-and-wills-freelancers/florida-us/

As I recall the attorney we used, recommended by our financial advisor, charges a $4K flat fee for all our various documents including, wills, trusts, power of attorney, etc..  In addition he gave us a good deal of excellent advice.  In my opinion it was well worth the investment.

@jaldeborgh do you mind sharing the name?

Posted by: @stjohnjulie

@jaldeborgh do you mind sharing the name?

I’m happy to but he’s Massachusetts based, we’ve been seasonal residents but now that I’m retired I’m looking into making the STX our permanent residence beginning in 2023.  We will still split our time and own real estate in Massachusetts but I’m already spending at least 6 months on island.  Let me know if you’re still interested in the contact info. 

Ah.  I see!  Thanks for the offer but since I’m just V.I. based I would like a V.I. lawyer.   There are just too many things here that don’t make a lot of sense and I’d rather have a lawyer that is familiar with the systems here.  Appreciate the offer though!