by Elizabeth A. Tomlin
Farm families from eight central New York counties recently attended a seminar hosted by Cornell Cooperative Extension of Herkimer County to learn about legal aspects of farm transfer and estate planning.
Speakers included Lorraine Lewandrowski, Esq., Agricultural and Food Law Attorney; Certified Elder Law Attorney Jeffrey Rheinhardt of Radley and Rheinhardt, P.C.; Attorney Chris Bray of Radley and Rheinhardt, P.C.; NY FarmNet Consultant Patrick Lamb and Mohawk Valley Perinatal Network Health Advocate Gerda Mortelette.
A wide range of topics were addressed including the necessity of having a will, consequences of not having a power of attorney, types of trusts, Medicaid laws and nursing homes, medical judgements, protection of assets, and estate taxes.
“Don’t get overwhelmed!” advised Lewandrowski. “Start with the basics. Then look at some of the other options and see if they are right for your family and situation.”
The “basics” consist of a simple will and a power of attorney.
“What happens if you die without a will?” asked Lewandrowski. “The state determines who gets your property!”
To be considered legal in New York state, a will must be in its original form — not a copy, not handwritten, never have been unstapled and must be made up with specific legal formalities. “This is a very serious legal document.”
Anyone over the age of 18 can make a will.
It’s important to know the name on your farm’s deed to prove ownership. “I urge you to look at the deed to your farm!” Lewandrowski stated.
Lewandrowski said although farmers spend a lot of time planning crops and what to do with their land, they don’t spend time on planning what to do with the future of the farm or with other legal issues, such as their power of attorney.
Power of attorney is a written authorization to act on someone else’s behalf in dealing with bills, real estate, banking, health care and other legal matters.
“Power of attorney is very easy to do,” commented Lewandrowski. “It’s a simple document.”
Lewandrowski gave examples of cases where people had suddenly been hospitalized and unable to make any decisions.
“A farmer neighbor was out mowing and had a stroke,” Lewandrowski reported. “He spent a month in a coma and his wife couldn’t pay the feed bills. They almost lost their farm because he had no power of attorney in place! Huge medical bills can bring a farm to its knees!”
Healthcare proxies should be appointed and life insurance policies examined and kept updated, with beneficiaries moved to a younger generation.
Attorney Chris Bray spoke about the laws concerning Medicaid, especially in situations where nursing homes are used.
“Medicaid eligibility rules are very specific.” Bray said. “And the ‘look back’ period is 60 months.” Any uncompensated transfers and gifts during that 5-year period are searched for
Bray said annuities also complicate Medicaid eligibility. “Annuities create very complex Medicaid problems, they are always treated as a resource.”
Important to farmers is the fact that Medicaid considers land to be a valuable asset and depending on whether or not it is attached to your house, you may be required to sell it.
Community Health Advocate Gerda Mortelette discussed new laws concerning health insurance. “Farmers have a hard time getting on public health assistance because of the way their income is calculated,” Mortelette acknowledged. She reported on a ‘Healthy New York’ plan that will be offered to anyone who does not qualify for other medical assistance. “This is decent, basic health care.”
Mortelette also reported on a free health care clinic that is available to people in the Madison County area. The Mary Rose Center is a community action partnership, staffed with healthcare professionals who work on a voluntary basis.
Pre-planning for health care, insurance, medical bills and elder care was stressed.
Consultant Patrick Lamb described free services and resources available through NY FarmNet programs. These services include financial analysis and decision making, business planning, business transfers, retirement and estate planning, and farm family and personal wellbeing counseling — including mediation in farm family meetings and crisis intervention. “We don’t tell you what to do, but we’ll point you in the right direction,” Lamb stated.
“Good farming practices are necessary to build your farms and good business and estate planning are necessary to protect and preserve your farms and their value,” emphasized Certified Elder Law Attorney Jeffrey Rheinhardt. “You need to think about investing in the right planning like you would investing in your farm businesses.”
Rheinhardt said farmers don’t try to save money by not vaccinating their herd or fertilizing their crops and the same idea applies to planning. “You can save money by not planning, but if you or your spouse needs nursing home or other costly health care, or the hired man injures someone, what you saved will be small potatoes compared to what you may end up losing!”
This event followed up the Farm Transfer and Succession seminar held in November. Both sessions were made possible through a grant from Herkimer Co. Mental Health Services’ Farm Family Assistance Program.
Rheinhardt announced that similar, free, informational sessions will be held May 8 in Ilion and May 9 in Little Falls. Call 315-894-8330 for information.
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Legal Aspects of Farm Transfer and Estate Planning seminar hosted by Herkimer County CCE
by Elizabeth A. Tomlin