How to Leave Personal Property When You Die (Part 2)
In last week’s blog post, I talked about tangible personal property and more specifically how the sentimental value attached to this property can cause issues after death in terms of distributing this property. I explained that if you want to identify specific people to leave specific items to, making specific bequests (gifts) in your will is one way it can be done. Such a “laundry list” of items in your will is not, however, what we recommend. Rather, New Jersey law provides that if your will directs your executor to distribute tangible property by way of a written memorandum, should you choose to create one, then you can make such a list and leave it with your will. Very simply, the memorandum must identify the item and the person you wish to leave it to and must be signed and dated by you. After your passing, provided the will makes reference to such a list, your executor is instructed to follow it and distribute the items to the named persons. We also provide in the will that for any tangible item not on the list, or if no list exists, then these items are to be distributed per the residuary clause along with the rest of
How to Leave Your Personal Property When You Die (Part 1)
Some of the most contentious issues we see when guiding families with respect to estate administration involves tangible personal property. This is because of the emotional attachment to these items which may or may not also have financial value. New Jersey law provides a way to handle personal property which can alleviate many of the common issues. Before we discuss that, however, let’s identify what is and is not personal property. It’s often easier to start by identifying what is not considered personal property. Real estate is not considered personal property. Bank and investment accounts are not personal property. Even stock certificate shares are not personal property. Generally, tangible property includes items you would typically find in your home such as jewelry, clothing, furniture and collectibles. Motor vehicles are included. If you have prepared a will, you can include specific bequests (gifts) to specific recipients. The will always has, however, a “catch all” clause called the residuary clause. Whatever probate property not otherwise specifically covered by a specific bequest is distributed as part of the residuary estate. We do not recommend including tangible items as part of a specific bequest. Next week I’ll explain why.
2026 Estate and Gift Tax Changes
In this week’s blog post, I discuss changes to estate and gift taxes for 2026. As with Social Security and the Medicaid and VA programs which I have already detailed here in past weeks, inflation adjustments have changed some numbers applicable to estate and gift taxes. Estate tax is due on certain individual’s estates after they die. While New Jersey does not currently have an estate tax (we do still have an inheritance tax), federal estate tax still exists for estates over a certain size. For persons dying in 2026, only estates over $15,000,000 are subject to federal estate tax. This number is up from $13,990,00 last year. I should also note that the sunset provision of the current law was set to take effect in 2026 which would have cut the exemption in half. Congress, however, did eliminate that provision - that is unless Congress decides to change it again. The annual gift tax exclusion is also indexed for inflation but only is bumped up when the inflation adjustment pushes it over the next $1000 threshold. That hasn’t happened yet so In 2026 the annual gift tax exclusion will remain at $19,000. For married couples, because of what is called a “split gift”, they can gift as much as
2026 Medicaid Numbers
In my last 2 blog posts, I updated you on some of the new Social Security, Medicare and VA Aid and Attendance numbers for 2026. The recently announced Social Security cost of living adjustment (COLA) of 2.8% follows a 2025 increase of 2.5%. Many other federal programs are tied to the Social Security COLA. These include Medicaid and the VA Aid and Attendance programs. This week we will review the 2026 Medicaid numbers. Medicaid’s programs that cover long term care have a strict income cap or limit. For 2026 that number is $2982 per month. Anyone with more than $2982 per month of gross income (before taxes and Medicare and health insurance premiums are deducted) must use a Qualified Income Trust in order to qualify for Medicaid. Medicaid recipients must also have less than $2000 of countable assets. For a single applicant, a home is an exempt asset up to a certain limit as long as the applicant is living in it. In 2026 the limit is $1,130,000 of equity. Anything above that amount is countable. For a married couple where at least one of the spouses is living in the home there remains no limit. In other words, the home is exempt in that case no matter the value. In the case of a
2026 VA Aid and Attendance Numbers
In this week’s post I will review the updated numbers for 2026 for the VA program that provides a benefit to wartime veterans and their spouses. Known as the VA Aid and Attendance program, this benefit provides a special pension to eligible applicants who need long term care. The maximum pension amount is tied to the same cost of living adjustment as Social Security, which for 2026 is 2.8 %. For a single veteran with no dependents the maximum pension one can receive goes up to $2424 per month. For a married veteran the maximum for 2026 will be $2874. For a widowed spouse who needs care the 2026 maximum will be $1558 per month. The Aid and Attendance program is a needs based benefit. This means that to be eligible one must meet a financial test. Different than Medicaid, the VA uses a net worth test. It calculates the applicant’s (in the case of a married couple both spouse’s) annual income and adds that to the countable assets. This is known as the net worth. For 2026 the net worth must be no more than $163,699 to qualify for this benefit. Existing VA A&A recipients should have received a letter from the VA informing them of the new amount they
2026 Social Security Cost of Living Adjustment
When we get to the end of the year, it’s time to look ahead to what numbers will change in 2026 for the government programs from which our clients receive benefits. It starts with the Social Security Administration, which announces its cost of living adjustment (COLA). Other government programs then adjust their numbers, often using the same COLA as Social Security. Since inflation hit a 40 year high in 2022, the rate has dropped. After a COLA of 8.7% in 2023, the adjustment dropped to 3.2% for 2024 and 2.8% in 2025. For 2026, the Social Security administration has announced another 2.8% increase. Inflation, has continued to decline this year and consequently so has the COLA. This bump up will be first be seen in January, 2026 monthly payments. Medicare numbers will also change next year, although not tied to the same adjustment. Similar to last year, the standard Medicare Part B premium that most people pay will increase. In 2026 While that number will increase by almost 10% to $202.90 per month.. Certain Medicare deductibles and copays will increase next year. The Part A hospitalization deductible will increase by $60 to $1736 and the copay for days 61 through 90 is expected to increase from $419 to $434 per day. Medicare covers