Caitlin E. Fitzgerald, Esq.cfitzgerald@elderlawmi.com

As is our custom, this semiannual correspondence is intended to keep you abreast of

developments in the law. The following is a brief summary of noteworthy developments

since our last communication:

P. Mark Accettura, Esq. maccettura@elderlawmi.com

Samuel A. Hurwitz, Esq. shurwitz@elderlawmi.com

Rebecca A. Coyle, Esq.bcoyle@elderlawmi.comAlso admitted to AZ bar

Kimberly G. RappOffice Manager kgrapp@elderlawmi.com

Accettura & Hurwitz

The VA has raised the eligibility bar by changing

the criteria for accepting independent and

assisted living facility fees as unreimbursed

medical expenses. Now, in order for these

facility fees to be counted as a medical expense,

the veteran or surviving spouse must receive

at least two services for activities of daily living

(ADLs) such as bathing, showering, dressing,

eating, transferring, and incontinence care.

Medication reminders are no longer included

as an ADL. The new policy only affects new

and pending claims. Veterans or surviving

spouses already receiving pensions are not

affected, unless they move facilities. In such

cases, the new facility must meet the new ADL

requirements

Medicaid UpdatesMedicare will cover up to one hundred days

of rehabilitation following a three-day hospital

stay. The first twenty days are fully covered

by Medicare, while a $148 per day deductible

(covered under most Medigap health insurance

policies) applies to days 21 through 100. Until

very recently, Medicare coverage (for the most

part provided in the nursing home setting)

was conditioned on the patient “improving.”

Medicare was cut off for patients that

“plateaued,”

In a recent development that favors patients, the

court in Jimmo v Sebelious, (a federal class action

suit brought against the Secretary of Health

and Human Services) held that the so-called

improving standard is not the correct standard.

The court developed a lower standard for

coverage ruling that Medicare should continue

in cases where long-term rehabilitation is

necessary to maintain the patient’s condition or

to prevent or slow further deterioration.

We expect that the effect of the ruling will

be expanded Medicare coverage for a sicker

population. Note that a number of Medicare

advantage plans do not cover the $148

deductible for days 21 through 100. If you have

such a plan you should consider changing to

one that does, or to traditional Medicare with

a Medigap policy, during the open enrollment

period that runs from October 15 through

December 7.

We look forward to speaking with you soon.

Visit www.elderlawmi.com

Very truly yours,

ACCETTURA & HURWITZ

P. Mark Accettura

Samuel A. Hurwitz

Rebecca A. Coyle

Caitlin Fitzgerald

SPRING 2013

UPDATE

Phone: 248.848.9409 | Fax: 248.848.9349 | www.elderlawmi.com

Estate & Elder LawAccettura & Hurwitz

4

SPRING 2013

UPDATE

Estate & Elder Law

News About Us New Farmington Hills and Canton Locations

We are enjoying our new

Farmington Hills office located at

34705 W. 12 Mile, Suite 103,

Farmington Hills, Michigan

48331. Our new space is a mere

200 yards east of our old location.

Our phone, fax, and email

information have not changed.

There are four handicapped and

eight guest parking spots at the

North/12 Mile entrance, and we

are just inside the front door in

suite 103.

We opened our new Canton location

in mid-November 2012. The address

is 44245 Ford Rd., Ste. 101, Canton,

MI 48187. Our Royal Oak location has

not changed.

Mark is working on the 3rd Edition of

his book, The Michigan Estate Planning

Guide, which he hopes to have in print

by the end of 2013. The new book

incorporates changes in the law since the

2nd Edition which was published in 2002.

Farmington Hills Office: 34705 W. 12 Mile Road, Suite 103,

Farmington Hills, MI 48331

Royal Oak Office:306 S. Washington Ave., Suite 215,

Royal Oak, MI 48067

Canton Office:44245 Ford Road, Suite 101,

Canton, MI 48187

Death To The Estate TaxAfter waiting more than ten years for permanent

guidance, Congress has acted to effectively eliminate

the federal gift, estate, and generation-skipping

tax for most Americans. The American Taxpayer

Relief Act of 2012 (“ATRA” or the “Act”) makes the

following changes:

• The Act increased the federal gift, estate and

generation-skipping transfer tax exemption

amounts to $5,000,000, adjusted annually for

inflation ($5,250,000 for 2013);

• The tax rate for transfers above the new

exemption amount was increased from 35% to

40%;

• The gift tax annual exclusion for 2013 was

increased to $14,000 per recipient;

• Under new portability provisions, the

predeceased spouse’s unused estate tax exemption

is available to the surviving spouse whether or

not the first spouse to die had a separate trust

at the time of their death. However, a proper

federal estate tax return is necessary to preserve

the first spouse’s exemption. The effective

exemption for married couples is now $10.5

million even without each spouse creating a

separate trust.

The effect of the new law is that most married

couples, especially those in first marriages, need only

adopt a single “joint” revocable living trust. In most

cases, couples who under prior law had adopted two

trusts (to double the amount they could leave tax-

free), should merge their separate trusts into a single

joint trust. Couples with estates in excess of $10.5

million, couples with children not of the marriage,

and grantors who do not wish to allow their surviving

spouse unfettered control of their inheritance, may

wish to continue with two trusts.

The Cottage Tax and the Parent-Child TransferRecent Michigan legislation provides a unique

opportunity with regard to real estate intended

to stay in the family. Prior to the amendment of

the General Property Tax Act by Public Act 497

of 2012, transfers of residential real estate from

parents to children at death caused an “uncapping”

of the taxable value of the property to its fair

market value. As a result of the death of a parent,

the property tax on highly appreciated property,

like lakefront property and vacation homes,

skyrocketed.

Under the new law, transfer of property from a

parent to a child will not uncap the taxable value

of the property so long as the use of the property

does not change following the transfer. The new

law applies to transfers that occur on or after

December 31, 2013.

The new rules are most relevant in cases where

“heirloom” property is intended to be kept in

the family. In such cases, children will be able to

continue to pay property taxes on the same taxable

value (as adjusted from year-to-year) that their

parents enjoyed.

Interestingly, the new provisions do not address

the question of whether the exemption applies

to transfers from a parent’s revocable trust or

from a decedent’s estate. Until we receive further

guidance, we will use Ladybird deeds that transfer

ownership of heirloom properties from parents

directly to children, without passing through

the parent’s revocable living trust.

VA Aid and Attendance Benefit UpdateAid and Attendance is a Veterans Administration

benefit that is available to veterans and their spouses

who are at least sixty-five years of age. The benefit

assists them with the cost of in-home care, assisted

living, and nursing home care. Aid and Attendance

is perhaps most beneficial for veterans and their

spouses in need of assisted living since no other

government program covers such care.

The VA has made several policy changes recently

in an effort to reduce costs and increase efficiency.

First, it has eliminated the annual Eligibility

Verification Report (EVR) requirement. Instead the

VA has implemented a new Computer Matching

Program to confirm eligibility requirements sharing

information with the Internal Revenue Service,

Social Security Administration and other agencies.

To ensure proper matching, a gift tax return should

be filed by all 2013 and future pension recipients

that divested assets in order to qualify for Aid and

Attendance. If you have filed or will file a claim for

pension in the current year, please contact us to

discuss the possible need for a gift tax return.

Note that the new Computer Matching Program has

not eliminated the need to file an annual Medical

Expense Report (which discloses unreimbursed

medical expenses). Claimants must also respond to

all inquiries from the VA or risk disqualification.

Our spring 2013 seminar entitled Fundamentals of Elder Law: Practical Applications For Health Care

Professionals was a huge success with over 100 nurses, social workers, and health care administrators

attending for continuing education credit. We were honored to have guest speakers Honorable Milton L.

Mack, Jr., Chief Judge of the Wayne County Probate Court and Peter Lichtenberg, Ph.D., Director of the

Institute of Gerontology at Wayne State University, on our program.

Accettura & Hurwitz2 3

SPRING 2013

UPDATE

Estate & Elder Law

Honorable Milton L. Mack, Jr. Peter Lichtenberg, Ph.D.P. Mark Accettura, Esq. and Samuel A. Hurwitz, Esq

Death To The Estate TaxAfter waiting more than ten years for permanent

guidance, Congress has acted to effectively eliminate

the federal gift, estate, and generation-skipping

tax for most Americans. The American Taxpayer

Relief Act of 2012 (“ATRA” or the “Act”) makes the

following changes:

• The Act increased the federal gift, estate and

generation-skipping transfer tax exemption

amounts to $5,000,000, adjusted annually for

inflation ($5,250,000 for 2013);

• The tax rate for transfers above the new

exemption amount was increased from 35% to

40%;

• The gift tax annual exclusion for 2013 was

increased to $14,000 per recipient;

• Under new portability provisions, the

predeceased spouse’s unused estate tax exemption

is available to the surviving spouse whether or

not the first spouse to die had a separate trust

at the time of their death. However, a proper

federal estate tax return is necessary to preserve

the first spouse’s exemption. The effective

exemption for married couples is now $10.5

million even without each spouse creating a

separate trust.

The effect of the new law is that most married

couples, especially those in first marriages, need only

adopt a single “joint” revocable living trust. In most

cases, couples who under prior law had adopted two

trusts (to double the amount they could leave tax-

free), should merge their separate trusts into a single

joint trust. Couples with estates in excess of $10.5

million, couples with children not of the marriage,

and grantors who do not wish to allow their surviving

spouse unfettered control of their inheritance, may

wish to continue with two trusts.

The Cottage Tax and the Parent-Child TransferRecent Michigan legislation provides a unique

opportunity with regard to real estate intended

to stay in the family. Prior to the amendment of

the General Property Tax Act by Public Act 497

of 2012, transfers of residential real estate from

parents to children at death caused an “uncapping”

of the taxable value of the property to its fair

market value. As a result of the death of a parent,

the property tax on highly appreciated property,

like lakefront property and vacation homes,

skyrocketed.

Under the new law, transfer of property from a

parent to a child will not uncap the taxable value

of the property so long as the use of the property

does not change following the transfer. The new

law applies to transfers that occur on or after

December 31, 2013.

The new rules are most relevant in cases where

“heirloom” property is intended to be kept in

the family. In such cases, children will be able to

continue to pay property taxes on the same taxable

value (as adjusted from year-to-year) that their

parents enjoyed.

Interestingly, the new provisions do not address

the question of whether the exemption applies

to transfers from a parent’s revocable trust or

from a decedent’s estate. Until we receive further

guidance, we will use Ladybird deeds that transfer

ownership of heirloom properties from parents

directly to children, without passing through

the parent’s revocable living trust.

VA Aid and Attendance Benefit UpdateAid and Attendance is a Veterans Administration

benefit that is available to veterans and their spouses

who are at least sixty-five years of age. The benefit

assists them with the cost of in-home care, assisted

living, and nursing home care. Aid and Attendance

is perhaps most beneficial for veterans and their

spouses in need of assisted living since no other

government program covers such care.

The VA has made several policy changes recently

in an effort to reduce costs and increase efficiency.

First, it has eliminated the annual Eligibility

Verification Report (EVR) requirement. Instead the

VA has implemented a new Computer Matching

Program to confirm eligibility requirements sharing

information with the Internal Revenue Service,

Social Security Administration and other agencies.

To ensure proper matching, a gift tax return should

be filed by all 2013 and future pension recipients

that divested assets in order to qualify for Aid and

Attendance. If you have filed or will file a claim for

pension in the current year, please contact us to

discuss the possible need for a gift tax return.

Note that the new Computer Matching Program has

not eliminated the need to file an annual Medical

Expense Report (which discloses unreimbursed

medical expenses). Claimants must also respond to

all inquiries from the VA or risk disqualification.

Our spring 2013 seminar entitled Fundamentals of Elder Law: Practical Applications For Health Care

Professionals was a huge success with over 100 nurses, social workers, and health care administrators

attending for continuing education credit. We were honored to have guest speakers Honorable Milton L.

Mack, Jr., Chief Judge of the Wayne County Probate Court and Peter Lichtenberg, Ph.D., Director of the

Institute of Gerontology at Wayne State University, on our program.

Accettura & Hurwitz2 3

SPRING 2013

UPDATE

Estate & Elder Law

Honorable Milton L. Mack, Jr. Peter Lichtenberg, Ph.D.P. Mark Accettura, Esq. and Samuel A. Hurwitz, Esq

Caitlin E. Fitzgerald, Esq.cfitzgerald@elderlawmi.com

As is our custom, this semiannual correspondence is intended to keep you abreast of

developments in the law. The following is a brief summary of noteworthy developments

since our last communication:

P. Mark Accettura, Esq. maccettura@elderlawmi.com

Samuel A. Hurwitz, Esq. shurwitz@elderlawmi.com

Rebecca A. Coyle, Esq.bcoyle@elderlawmi.comAlso admitted to AZ bar

Kimberly G. RappOffice Manager kgrapp@elderlawmi.com

Accettura & Hurwitz

The VA has raised the eligibility bar by changing

the criteria for accepting independent and

assisted living facility fees as unreimbursed

medical expenses. Now, in order for these

facility fees to be counted as a medical expense,

the veteran or surviving spouse must receive

at least two services for activities of daily living

(ADLs) such as bathing, showering, dressing,

eating, transferring, and incontinence care.

Medication reminders are no longer included

as an ADL. The new policy only affects new

and pending claims. Veterans or surviving

spouses already receiving pensions are not

affected, unless they move facilities. In such

cases, the new facility must meet the new ADL

requirements

Medicaid UpdatesMedicare will cover up to one hundred days

of rehabilitation following a three-day hospital

stay. The first twenty days are fully covered

by Medicare, while a $148 per day deductible

(covered under most Medigap health insurance

policies) applies to days 21 through 100. Until

very recently, Medicare coverage (for the most

part provided in the nursing home setting)

was conditioned on the patient “improving.”

Medicare was cut off for patients that

“plateaued,”

In a recent development that favors patients, the

court in Jimmo v Sebelious, (a federal class action

suit brought against the Secretary of Health

and Human Services) held that the so-called

improving standard is not the correct standard.

The court developed a lower standard for

coverage ruling that Medicare should continue

in cases where long-term rehabilitation is

necessary to maintain the patient’s condition or

to prevent or slow further deterioration.

We expect that the effect of the ruling will

be expanded Medicare coverage for a sicker

population. Note that a number of Medicare

advantage plans do not cover the $148

deductible for days 21 through 100. If you have

such a plan you should consider changing to

one that does, or to traditional Medicare with

a Medigap policy, during the open enrollment

period that runs from October 15 through

December 7.

We look forward to speaking with you soon.

Visit www.elderlawmi.com

Very truly yours,

ACCETTURA & HURWITZ

P. Mark Accettura

Samuel A. Hurwitz

Rebecca A. Coyle

Caitlin Fitzgerald

SPRING 2013

UPDATE

Phone: 248.848.9409 | Fax: 248.848.9349 | www.elderlawmi.com

Estate & Elder LawAccettura & Hurwitz

4

SPRING 2013

UPDATE

Estate & Elder Law

News About Us New Farmington Hills and Canton Locations

We are enjoying our new

Farmington Hills office located at

34705 W. 12 Mile, Suite 103,

Farmington Hills, Michigan

48331. Our new space is a mere

200 yards east of our old location.

Our phone, fax, and email

information have not changed.

There are four handicapped and

eight guest parking spots at the

North/12 Mile entrance, and we

are just inside the front door in

suite 103.

We opened our new Canton location

in mid-November 2012. The address

is 44245 Ford Rd., Ste. 101, Canton,

MI 48187. Our Royal Oak location has

not changed.

Mark is working on the 3rd Edition of

his book, The Michigan Estate Planning

Guide, which he hopes to have in print

by the end of 2013. The new book

incorporates changes in the law since the

2nd Edition which was published in 2002.

Farmington Hills Office: 34705 W. 12 Mile Road, Suite 103,

Farmington Hills, MI 48331

Royal Oak Office:306 S. Washington Ave., Suite 215,

Royal Oak, MI 48067

Canton Office:44245 Ford Road, Suite 101,

Canton, MI 48187