Medicaid Asset Protection: Unterschied zwischen den Versionen

Version vom 21. Juli 2012, 14:45 Uhr

As tax preparation time begins, several seniors are asking to include Medicaid asset protection as part of their tax planning strategies. For those of you not familiar with the 2005 Tax Reduction Act, some of the provisions address certain transfers by seniors under the new Medicare nursing house provisions. Beneath the new provisions, just before a senior qualifies for Medicare help into a nursing house, they need to invest-down their assets. These new restriction have a 5 year appear-back, utilised to be 3 years. And used to be that every single spouse had a one particular-half interest in the marital property, it now appears that all the marital assets are to be spent-down. I have not seen particular regulations but it appears that the healthy spouse will be left with out any assets if one particular of them gets sick.

Suggestions by seniors have been to transfer their assets to their young children. Though this choice is accessible, Im not confident that its a great selection. What if the kid decides to use the asset for themselves, what if they get divorced and the judge awards assets originally intended for the parents to the divorcing wifes decree, what if the child gets sued?

There are also tax implications. If the assets are transferred to the child for much less than fair market value, then its a taxable gift. Even worse, if this kind of transfer to the youngster is completed before the five years-appear back, -is it a fraudulent conveyance?

Medicaid asset protection has to be done extremely very carefully. Planning in this location is evolving. There are a lot of eldercare law firms popping up all more than the location. I have been approached by such a firm to send them clients. They claim that they can structure a new deal whereby the nursing house wont be in a position to attach assets even immediately after they enter the nursing home.

I know this significantly, any strategy utilised to deflect assets from the original owner has to be done at its fair market value. For example you just cant transfer your house from you to your youngster. There are tax consequences. Did you just sell your property? Or did you just gift your house? Who will decide the fair industry value? Did you get a genuine appraisal? If for that reason, its at much less than fair market value (prepared buyer and fraud reporting willing seller, neither below compulsion to purchase or sell, each acting in their finest interest) did you just develop a a lot more challenging issue?

Any technique whereby theres an element of strings attached, its revocable and as a result you have completed absolutely nothing to disassociate oneself from your asset. One can challenge your intent, to divert assets for the purpose of defrauding a potential creditor and failure to have filed a gift tax return has statutory penalties, and interest, worse- if Medicare intended, criminal?

I am billing medicare aware of only one technique of disassociating oneself from your asset (personal residence, your CDs, your investments, vacation spot) is to give it away. Period. You can gift it to your kids, spend the tax and thats it. The difficulty is that you no longer have any manage and you are at the mercy of your childs very good intentions and a blessed spouse. Risky? You bet!

An irrevocable trust with an independent trustee (not associated to you by blood or marriage) will fit the bill.

An irrevocable trust, is an irrevocable contract in between you and the independent trustee to manage the assets for the benefit of all beneficiaries. You and your spouse can grow to be beneficiaries along with your children and grand youngsters.

Timing is extremely critical. If the transfer (repositioning) of your useful assets is completed ahead of the 5 years, probabilities are very good that it will stand-up in court. What if its ahead of the 5 years are up? Is your Medicaid asset protection plan nevertheless good? In my book its far better to have medical billing fraud accomplished some thing than absolutely nothing.