Columbia Attorney Answers Frequently Asked Questions About Maryland Estate Planning, Special Needs Planning, Medicaid/Long-Term Care Planning and Business Planning
McDonald Law Firm in Columbia answers frequently asked questions below related to Maryland estate planning, special needs planning, Medicaid/long-term care planning and business planning. If you have other questions or require immediate assistance in one of these areas, call 443-741-1088 to schedule an initial consultation regarding your legal concern.
What is a Second Amendment Trust™, and how does it work?
Many types of firearms, including machine guns and certain rifles and shotguns, must be registered with the ATF, and they can only be possessed by their registered owner. Passing down a firearm, regulated by the National Firearms Act (NFA), to the next generation requires a cumbersome and expensive process of getting approval for the transfer from the ATF, paying a sizable tax, and submitting the new owner to photographing and fingerprinting with the government.
A Second Amendment Trust, also known as a gun trust, gets around these burdensome requirements. By placing your NFA regulated firearms in a gun trust, their lawful use and possession can pass to anyone named in the trust as trustee, except individuals prohibited by federal and state law from possessing a firearm, and you can name multiple trustees if you choose. A Second Amendment trust avoids the federal transfer tax and other requirements usually associated with weapons transfers. Care should be taken in drafting and administering a gun trust to make sure it complies with all applicable state and federal laws.
What is a Special Needs Trust?
If you have a child with a disability, you know that child may need additional financial support throughout his or her lifetime to deal with medical issues or to supplement income due to limited employability. Government programs such as Medicaid and Supplemental Security Income (SSI) can provide monthly financial assistance, but these programs are means tested, and recipients of government assistance must keep very low income and asset limits to maintain their eligibility for benefits. A gift or inheritance therefore can wipe out a person’s ability to receive much-needed assistance.
The answer in these cases is a special needs trust. Funds can be placed into the trust and used by the beneficiary with special needs, without destroying the recipient’s income eligibility for SSI or Medicaid. Make sure your attorney is skilled and knowledgeable about special needs trusts to create a valid and enforceable trust.
How is a Self-Settled Special Needs Trust different from a Third Party Special Needs Trust?
A self-settled special needs trust is funded with a beneficiary’s own assets, as opposed to being funded with the assets of a third party. A self-settled special needs trust is an estate planning tool, which can be created by a parent, grandparent, guardian, or a court in order to maintain a special needs child eligibility for government mean-tested benefits (such as Medicaid and Supplement Security Income). A major difference between a self-settled special needs trust and a third-party special needs trust — is the Medicaid payback provision a self-settled special needs trust must have in order for the self-settled special needs trust assets not be counted for Medicaid income eligibility purposes.
Are Non-Compete Agreements enforceable in Maryland?
An employer may want to restrict a former employee’s ability to compete with the company, when such a restriction is necessary to protect trade secrets, sales territory, or customer or client lists. When asked to enforce a covenant not to compete, whether it is a clause in the employment contract or a standalone agreement, courts will scrutinize the language to make sure it is reasonable. For instance, the restriction should be limited in its geographic scope and also how long the restriction is in effect. A non-compete clause or agreement should be carefully drafted or reviewed by a competent business planning attorney to help ensure that it is fair and reasonable and will be enforced by the courts if the need ever arises