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Estate Planning Update – Estate Recovery Alert

Governor Baker’s Fiscal Year 2017 budget includes a proposal that would allow Mass Health estate recovery from non-probate assets.  The current law defines an “estate” against which recovery can be made as “all real and personal property and other assets includable in the decedent’s probate estate under the General Laws”.  Governor Baker’s proposal would apply to individuals who become eligible after July 1, 2016 and seeks to define such estate as:

any interest in real and personal property and other assets in which the individual immediately prior to death had any legal title or interest, to the extent of such interest.   This shall include interests in real and personal property and other assets that would pass to a survivor, heir or assignee of the decedent through joint tenancy, tenancy by the entirety, life estate, living trust, right of survivorship, beneficiary designation or other arrangement.  This shall not include annuities and life insurance held on the life of a decedent, with the exception of payments otherwise includable in the decedent’s probate estate.  (Emphasis added)

We have historically counseled many clients to utilize trusts and life estates to avoid the estate recovery provisions.  If this law passes, these planning techniques will no longer be available.  We urge you to contact your elected officials and express your displeasure with this proposal.

The complete proposal can be found at  http://www.mass.gov/bb/h1/fy17h1/os_17/h11.htm

 

This update is designed for general information only. The information presented should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. For further information please contact one of our attorneys. Information contained herein has been abridged from laws, court decisions and administrative rulings, and should not be construed as legal advice or legal opinions on specific facts.  The enclosed material is provided for education and information purposes by MacLean Holloway Doherty, P.C. to clients and others who may be interested in the subject matter. 

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