IL Estate Planning Blog

Wednesday, August 10, 2016

10 Tips for Bringing Your Children into the Family Business

Here is something from that might interest you:

Thinking about bringing your children into your family or small business? Beware! This can be either a blessing or a curse depending on how you do it. Experience shows there are right ways to introduce your offspring into your business and, most decidedly, wrong ways. The following are 10 tips for pursuing the former and avoiding the latter.

1) Have them work elsewhere for at least five years.
Read more . . .

Thursday, July 28, 2016

The Benefits of Charitable Lead Trusts

By American Heart Association:

The Benefits of Charitable Lead Trusts: Part II


Charitable lead trusts have become more attractive as an estate and income tax planning tool. The reason for this is the historically low Section 7520 rates (Applicable Federal Rates or AFRs). In recent years, the AFR has hovered between 1.0% and 2.4% and hasn’t been above 3.
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Monday, July 11, 2016

Try Before You Buy in a Retirement Community

When seniors are checking out places to retire — or join the 55-and-over "active adult" set — their question often is, "How do I know I'm going to like the community I'm considering?"

That's the dilemma Mike and Robyn Bonitz faced when looking for a place to retire. After narrowing their choices to four retirement communities — one in Summerville, S.C.; one in Ocala, Fla.; and two in Ariz.

Read more . . .

Tuesday, July 5, 2016

Medicare Observation Care Requirements

Controversy Erupts Over Medicare Observation Care Requirements
In August, a federal law kicks in requiring hospitals to tell their Medicare patients if they have not been formally admitted and why. But some physician, hospital, and consumer representatives say a notice drafted by Medicare for hospitals to use may not do the job. The law was a response to complaints from Medicare patients who were surprised to learn that although they had spent a few days in the hospital, they were there for observation and were not admitted. Observation patients are considered too sick to go home yet not sick enough to be admitted. They may pay higher charges than admitted patients and do not qualify for Medicare's nursing home coverage.
Read more . . .

Friday, June 24, 2016

"I Needed to Find Care for my Elderly Aunt. What I Found was an Eldercare Crisis"

The call came right after lunchtime.

“I’ve fallen again.”

My great-aunt Emma sounded frustrated and frail. Her arm hurt too much to move, she said, let alone pick up the bag of groceries she’d just bought. It might be broken.
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Friday, June 10, 2016

Downsizing the Family Home

Book Review:  ''Downsizing the Family Home" by Marni Jameson

"I wanted to be respectful of my parents' belongings, honor their lives, be a good steward of their assets, and preserve their past and mine.  At the same time, I didn't want to be weighed down by more stuff, even if it meant something -- and it almost all did."


It's a rite of passage almost no one will escape; the difficult, emotional journey of downsizing your or your aging parents' home.  In this book, nationally syndicated home design columnist Marni Jameson sensitively guides readers through the process, from opening that first closet, to sorting through a lifetime's worth of possessions, to selling the homestead itself.  Using her own personal journey as a basis, she chronicles the clearing out of her parents' home of nearly fifty years, from the moment she stood paralyzed on the threshold to the day it sold to another family -- and reveals her strategies for accomplishing the task quickly, respectfully, and rewardingly.
Read more . . .

Tuesday, May 10, 2016

How to Deal with Digital Assets in Estate Planning

Taken from Huff Post Canada, March 25, 2016 


Due to recent technological advancements, one's digital presence has become an important part of every day life.  As a result, it is increasingly important to consider how this may impact traditional estate planning. With increasing frequency, individuals are creating complex lives online, which may include a social media presence, electronic banking, reward point balances, online investments, and many other possibilities.


Many people also now store digital assets that can have strong sentimental value, such as family photos or favourite playlists, online. As the types of assets that we store in digital formats continues to expand, important issues, such as how they will be accessed post-death, should be a consideration during estate planning involving our more traditional assets.

It is important to note that the issue of digital assets and estate planning does not concern only the younger generation. The conveniences and increased accessibility of technology have also attracted a large portion of the older population, including many who may already have estate plans in place. As it is always recommended that an estate plan be periodically revisited, especially when there are any significant life changes, the organization and implementation of digital assets should also be considered at these junctures.

Unfortunately, it is all too common to see these types of assets overlooked in a will. First and foremost, it is essential for advisers to be asking the right questions about the nature of a testator's assets. This may require probing beyond the consideration of traditional assets, such as real property and bank accounts. In many cases, a digital asset may have no monetary value and it may be overlooked for this exact reason. Asking pointed questions regarding digital assets and having the testator prepare a list of information he or she stores online can help determine how these assets should be distributed or managed.

Another important aspect to address is how digital assets will be accessed after death. Digital assets and accounts are typically accessed by way of a username and password. If the executors of an estate are not provided with this information, they may encounter difficulties when trying to determine what these assets encompass and in obtaining access in order to effectively administer them.

The rules surrounding executor access to online accounts following the death of an account holder vary significantly. It is prudent to provide your executors with a list of online accounts and the corresponding access information rather than risk future inaccessibility as a result of different access requirements. Many sites are based outside of Canada, which means that the executor may encounter conflict of laws issues in the event that the executor’s authority is not recognized in the relevant jurisdiction. This can result in unexpected costs and delays in the administration of the estate.

In order to address this, it is highly recommended that testators give careful consideration to providing a detailed list of any virtual accounts and to an appropriate method of storage for the  username and passwords, to be used after death. There are multiple ways in which this can be accomplished. For instance, it could be in as simple a format as a list that is given to your executors prior to death or attached as a memorandum to the will itself. It is not recommended that the password list form part of the will itself, as it may be made public if the will is probated. However, it is important to bear in mind that this list should be updated periodically. Passwords are sometimes changed (voluntarily or mandatorily) and accounts may be added or deleted. A static list that is created at one point in time will not necessarily be an accurate reflection of the virtual accounts and access information at the time of death.

Another storage method is to make use of online password storage services. There are multiple sites that have been established to provide this service. They are designed to store usernames and passwords to all virtual accounts in a safe and secure format which can be accessed by one master password. In this way, the list can be updated easily and an executor only needs to be provided with one password in order to access all of the necessary information.

As for social media, special concerns may arise with respect to personal preferences surrounding how these accounts should be dealt with post-death. Some may prefer to have these accounts shut down altogether, whereas others opt to have them memorialized in such a way that friends and family have a place to share memories of the deceased. Given these different approaches, it can be useful to provide some direction to your executors regarding your specific preference on the issue. Leaving a social media account open without any planning may seem harmless, but can inadvertently cause unnecessary pain to loved ones. For instance, if the account is not memorialized or deleted, photos of the loved one may appear in Facebook’s “Year in Review” and friends and family will continue to receive annual reminders and prompts to wish the deceased a happy birthday.

In 2016 and beyond, it is impossible to ignore the fact that technology has changed the way we live. Our lives are increasingly intertwined with the virtual world and, accordingly, plans should be made so that assets and information stored digitally are appropriately dealt with at death. 

Tuesday, April 19, 2016

Avoiding Risky Drug Interactions

Taken from Chicago Tribune 2/14/16

Experts say there are important steps patients can take to help protect themselves from a harmful mix of medications.

  • With every new prescription, ask your doctor and pharmacist about what other medications you should avoid, including over-the-counter drugs, foods and dietary supplements.
  • Carry a list of all current medications and bring it to any medical appointments.  The list should include drugs taken only occasionally, over-the-counter medications, patches, tablets, inhalers, drops, liquids, ointments and injections, as well as herbal, vitamin and dietary supplements.
  • Read the complete package insert for all medications you're taking.
  • Use one pharmacy for all your prescriptions.
  • Educate yourself about potential drug interactions for any medications you are taking.
  • If a doctor provides you with a new drug sample, ask if it interacts with the medications you're currently taking.  Routine computer safety checks may have been skipped.
  • Take as few medications as possible.
  • Do not take medications prescribed to someone else.

--Karisa King

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Tuesday, March 29, 2016

IRS to ask about Health Insurance Coverage on Tax Forms this Year


Be prepared for the tax man to get even more personal this year — with questions about your health insurance.

For the first time, you'll have to state whether you had health insurance, through an employer, one of the exchanges or purchased privately. And if you didn't, you could face a penalty.

Also, if you got advance payments of the premium tax credit under the Affordable Care Act, even for only part of the year, there's a new form to file. You'll have to file it even if you only got tax credits for part of the year. And tax filers accustomed to using a 1040EZ will no longer be able to do that if they got a tax credit.

There's more. If you had life changes — a new job with a higher salary, for example — from the time those tax credits were approved, you could end up having to pay some or all of the money back. Conversely, if you lost your job and faced a long period of unemployment, you might now be eligible for the credit.

"I see deer-in-the-headlights looks," said Dave Duval,'s vice president of consumer advocacy. "These are new items. ACA has been on the books since 2010. We've ignored it, not looked at it, not paid attention to it. It's on the tax return that we're going to be doing for 2014."


The law requires individuals to have what the government calls minimum essential coverage unless they qualify for one of more than 30 exemptions. For those without insurance — or an exemption — there's a penalty stemming from the law's premise that health care coverage is a shared responsibility among federal and state governments, insurers, employers and individuals.

For 2014, the penalty is the greater of 1 percent of your household income above the threshold for filing taxes or what the Internal Revenue Service calls "your family's flat dollar amount" — $95 per adult and $47.50 per child, with a family maximum of $285 in 2014.

However, the average penalty for the 2014 tax year is expected to be higher — $301, according to Sacha Adam, health care team leader at Intuit, maker of TurboTax. Under the law, those fines will go up for people who remain uninsured in 2015, to about $590 on average.

"Getting health insurance is a big decision for some folks," Adam said. "When it comes to reporting your health insurance on your taxes, it's going to be very straightforward."


Reporting your health insurance coverage begins on line 61 of Form 1040.

"For the vast majority of Americans, tax filing under the Affordable Care Act will be as simple as checking a box to show they had health coverage all year," Treasury Secretary Jacob Lew said in a statement.

The Department of Health and Human Services estimated that more than three-quarters of taxpayers will need to do no more that.

"If you have it and you have the ability to demonstrate you had it, that should be it and you're not going to be subject to having the additional penalty assessed," said Greg Rosica, a taxpartner at Ernst & Young.

People insured through the exchanges will get Form 1095a in the mail attesting to their coverage and how much of an advance premium tax credit they received. Employers are not required to provide proof of coverage for 2014.


"A fraction of taxpayers will take different steps, like claiming an exemption if they could not afford insurance or ensuring they received the correct amount of financial assistance," Lew said. "A smaller fraction of taxpayers will pay a fee if they made a choice to not obtain coverage they could afford."

If you received a premium tax credit or might be entitled one, file Form 8962. That will determine whether you got too much of an advance credit payment and have to repay some of it, or if you didn't apply and might be eligible for the premium tax credit on your return.

For those who didn't have health insurance, there's yet another form — Form 8965 — which lists the possible exemptions and lets you claim the one that might apply. It's also where you figure out your penalty if you didn't have coverage for all or part of 2014.

"There's a lot to look for. It is kind of complicated," said Barbara Weltman, contributing editor to the tax guide "J.K. Lasser's Your Income Tax 2015."

The good news, she said, is most people use a paid preparer or software to do their taxes, and they'll be walked through the questions that have to be answered for the health insurance section of the tax return.

"In the tax preparation process, they're not really exposed to forms until the very last moment," Adam said. "At TurboTax, we'll figure out what forms need to be provided."


The IRS has a page on its website devoted to the Affordable Care Act. There, you can access videos featuring the IRS Commissioner, John Koskinen, as well as a number of new publications that provide information about health care and taxes.

Because of the complexity of the requirements, Koskinen told Congress last fall that he expects an increase in calls to IRS toll-free help lines about ACA and taxes. "Our ability to meet this demand may be strained due to ongoing budget constraints and the possibility of an additional increase in call volume related to the impact of tax extender legislation that may be passed later this year," he said.

TurboTax and H&R Block are among the companies that provide guides to taxes and ACA on their websites, and the Tax Policy Center can help you estimate your penalty.


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Tuesday, March 8, 2016

Get Ready for FAFSA by Terry Savage


Get Ready for FAFSA - Huffington Post December 9, 2015

Copyright Terry Savage Productions, Ltd.; Distributed by Huffington Post
Every January millions of high school seniors, and college students, and parents sit down together to fill out the dreaded FAFSA form -- the Free Application for Federal Student Aid. The form is more intrusive than the Federal tax forms, because it asks not only about income but assets of parents and students.


The FAFSA is the basis for almost all student aid, loans and grants -- whether aid that is based on financial need or merit-based aid. You'll find it explained thoroughly at There you can fill out the forms, save your information, and then click to file online. Financial aid is often given out on a first-come, first-served basis -- so don't delay.
And according to Susie Bauer, head of 529 and college planning for Baird, the Midwest-based international financial services firm, you should get ready for some big changes in FAFSA for the 2017-2018 school year -- including some moves you should make now -- even if your child is only a high school sophomore.
Here are five key things to know about FAFSA, financial aid, and 529 plans:
1. Financial Aid is income-driven, but assets count, too. The FAFSA form asks for all income, substantiated by the parents' tax return (both parents, if divorced). Capital gains count as income, so selling stocks and taking gain in the year before filing can impact aid. Similarly, harvesting up to $3,000 of capital losses can reduce parental income. If the student has income, it reduces financial aid on a dollar for dollar basis - creating a disincentive for students to work and contribute to their education.
2. 529 College Savings Plans can impact financial aid. A 529 plan owned by the parent is treated as any parental asset for FAFSA and has minimal impact on financial aid. When a grandparent or other person is owner of the 529, it does not show up as an asset on FAFSA. BUT, when you start withdrawing from a grandparent-owned 529, it is counted as direct income to the child - with a much larger impact on financial aid. If grandparents hold such an account, don't start withdrawing until the junior year of college - after you have filed the FAFSA for that year.
3. Assets owned by a child weigh heavily against the family in the aid formula. UTMA (custodial) accounts should be spent for the benefit of the child in advance of the FAFSA filing year - or rolled into an UTMA 529 account, where they will be treated as a parental asset.
4. You can't use a 529 to pay student loans. Careful planning to use 529 money is essential. No, you can't withdraw to pay down student loans. You can withdraw 529 money tax and penalty-free only to pay for "qualified expenses" such as tuition, room, board, books and certain other fees. If used for something else, there is a 10 percent penalty and taxes must be paid on any earnings over the years. (The exceptions to the penalty occur when a student gets a scholarship, or dies, or is disabled.)
5. Timing is everything. Not only should you file early, but you should be aware of two important FAFSA changes coming in 2017.  
First, instead of waiting to file your tax return, or estimating income, you will be able to use the FAFSA IRS Retrieval Tool to verify income from your 2015 return, the prior-prior year. Thus, the income you report for your 2015 return, which you file next April, will impact financial aid for the 2017-2018 college year.  
The other big changes is that the starting date for filing the 2017-18 FAFSA will begin on October 1, 2016, instead of January 1, 2017. So there won't be a last minute rush - if you get started early!
Procrastination on FAFSA penalizes the family and the student. Get started now to accumulate as much financial aid as you can. It's a good investment of your time. And that's The Savage Truth.


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Monday, February 8, 2016

IRA's and Charities

     On December 18, 2015 Congress passed the PATH Act, which renews and makes permanent the Charitable IRA provision of 2006, making it easier for Americans to give to causes about which they care.  This provision has the power to help local charities strengthen their communities allowing individuals to roll over up to $100,000 annually from an Individual Retirement Account (IRA) to charity without being federally taxed.

     Millions of Americans continue to save pre-tax dollars in their IRAs. The law allows taxpayers 70 ½ and older to share their wealth by giving retirement savings directly to charity-and bypassing income tax.
      This law is important to local charities operating as agents of philanthropy in order to continue to build community and improve social service programs that benefit people every day.


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With two offices in Oak Lawn and Oak Brook, Stephen M. Sutera assists clients throughout Cook County, DuPage County and Will County IL including Chicago, Hometown, Barrington, Burbank, Burr Ridge, Chicago Ridge, Darien, Downers Grove, Evergreen Park, Geneva, Worth, Bridgeview, Palos Park, Palos Hills, Palos Heights, Hickory Hills, Midlothian, Willow Springs, Oak Forest, Orland Park, La Grange, Brookfield, Berwyn, Tinley Park, Hinsdale, Villa Park, Clarendon Hills, Westchester, Westmont, Lombard, Elmhurst, Western Springs, Berkeley, Downers Grove, Fox Valley, Glen Ellyn, Willowbrook, Aurora, Addison, Lisle, Forest Park, Bensenville, Wheaton, River Forest, Itasca, Shorewood, Frankfort, Mokena, Naperville, Crest Hill, Homer Glen, New Lenox, Bollingbrook, Schaumburg, Channahon and Woodridge.

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