In the past two or three years it has come to the attention of Kiel attorney Jim Ungrodt that after a Social Security recipient dies, the monthly benefit received during the month of death is “taken back” by the Social Security Administration.
Younger survivors probably do not realize that the “check” received during the month of death was already “earned” if the deceased lived the entire prior month. For example, Social Security received in February was earned by living the entire month of January.
After “taking” the money, the Social Security Administration sends a letter approximately a month later to the survivors indicating that if the survivor believes that the Social Security was taken in error, a claim can be made. The letter states that the recipient was not entitled to the benefit earned in the month of death; of course, those who are not familiar with the fact that the funds received in the month of death were earned in the prior month are left with the impression that a valid claim cannot be made.
Ungrodt offers this conclusion: Always be vigilant, for whether an agency or company (or individual) intends to rob you, or does it mistakenly, the result is the same and you have the chore of reclaiming what is rightfully yours.
Attorney Ungrodt continues to keep up to date in all areas of elder law. He said substantial changes seem to occur every three to four years as clients would like to “have their cake and eat it too” by enjoying the use of their assets and yet assuring that their children receive the assets rather than their assets being dissipated for nursing home care for themselves.
Certain assets are protected for spouses, but after a spouse passes away, there is likely to be a claim against the assets.
Because it is at times important to maximize assets of both spouses at the time one spouse goes to a nursing home, it may be best to wait until that occurrence to establish Burial Trusts—it is best to discuss this with a funeral director for the director’s input, rather than insisting that a Burial Trust be set up prematurely.
Ungrodt provided these examples of “bad ideas”:
n Transferring assets to one child, expecting that child to share assets with others (without any other agreement or documentation);
n Giving assets, such as real estate, to numerous children, where some may be difficult to locate immediately for any future sale of the property.
In recent years, there has been an emphasis on “probate avoidance.” Ungrodt said, “I have seen situations where people who own a home, and little else, pay for trusts they didn’t need. There are several ways to expeditiously transfer assets on death without probate or use of a trust. Bottom line—see your lawyer. Your lawyer will assist you competently in the above matters, and if your lawyer does not practice in that area, you will be referred to someone who can represent you.”