Obtaining eligibility for Medicaid often requires transferring assets to a spouse or other family members. When transferring assets, one must always consider the tax consequences of doing so. Obviously, there are many types of assets and each asset class may be treated differently from a tax perspective. There is no simple answer to your question….
For many families, a good portion of their wealth exists through the equity in their home. The home may also be the most sentimental asset as it carries many memories and emotional ties. We often counsel clients on different planning techniques to protect the home where Medicaid is contemplated to pay for nursing home or…
A 529 plan is a very common planning technique used by grandparents to fund a grandchild’s college education. Simply stated, contributions to a 529 plan grow tax-free over the life of the plan and if used for qualified tuition costs, the distributions from the plan are also tax-free. Notwithstanding the beneficial tax treatment of a…
Contrary to popular belief, it is never too late. An elder law attorney can work to implement many different techniques even at the 11th hour to preserve assets. What is important is that you have a relationship with an elder law attorney. An elder law attorney can relieve some of the anxiety natural to this time…
In a perfect world, everyone would craft an estate and elder care plan well in advance of having to implement it˗ but the world isn’t perfect! I have had the opportunity to work on a fair amount of cases where clients, who had no estate or elder can plan, fell ill or became…
Annuities are very complicated and often sold to individuals without considering their interplay with Medicaid eligibility. While there are various forms of annuity contracts, an annuity is either qualified or non-qualified. A qualified annuity is like an individual retirement account in that Medicaid will not take the principal balance of the annuity so long as…
Generally, in determining the Medicaid eligibility of a person receiving nursing facility services, any gifting of assets made by the applicant within the “look back period” will render the person ineligible for Medicaid for a period of time equal to the value of the gift divided by the regional rate. Under current law, the look…
Your spouse might be able to access your bank accounts but he will be very limited in doing much else. A properly drafted power of attorney and statutory gifts rider is an absolute necessity. When an elder law attorney prepares a power of attorney and statutory gifts rider, powers are included that are not readily…
Often confused, the look-back period and the penalty period are two distinct concepts in Medicaid planning. It is important to understand the applicability of each. The look-back period is the five-year retroactive period beginning on the date you enter a nursing facility. Thus, if you enter a nursing home on November 1, 2017, the look-back…
Unfortunately, we cannot control if and when we may fall ill but we can be proactive to protect our financial assets by planning early. The risk of requiring a nursing home within five years of creating a Medicaid Trust is generally a risk associated with waiting too long to meet with and elder law attorney….
It is worth noting at the outset that there are many types of irrevocable trusts. I think it is safe to assume that when you reference an irrevocable trust, you are speaking of the trust that we regularly use to protect your assets if you need to apply for Medicaid in the future. For our…
For 2017, the federal lifetime estate and gift tax exemption have increased to $5,490,000. This means that you can gift this amount over your lifetime without incurring a federal gift tax and to the extent you haven’t done so, any exemption remaining at death can be applied against the value of your estate for…
Medicaid Planning in Advance of Changes to the Healthcare System By: Salvatore M. Di Costanzo, Esq. With Congress about to break for a two week Spring recess, the repeal of Obamacare appears to have stalled and remains uncertain. Notwithstanding, we must pay attention to the various proposals that have been put forth by the…
This is a real fact pattern. I recently met with a family whose 86 year old Mother was admitted to a nursing home for dementia. They sought my assistance in obtaining Medicaid eligibility to pay for the nursing home, which cost $15,000 per month. Mother is still on Medicare which pays for the first 100…
At some point, most people experience that enlightening moment when they realize there is a risk of losing their assets if they fall ill and require long-term care. Some will contact an elder law attorney and receive sound advice; others will contact their friends and relatives, who after all, usually know more than most attorneys…
The look-back period is very different from the penalty period and as always the rules are different depending on whether you are seeking Medicaid to cover the cost of homecare or nursing home care. Conceptually, the look-back period is the period where asset transfers may impact your eligibility for Medicaid. The penalty period is the…