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CannonMurrayLaw, llc
Estate Planning, Elder Law, Medicaid-Long Term Care Planning,
Asset Protection Planning, Tax Planning, Real Estate,
Probate and Estate Administration |
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Our mission is to preserve and protect your assets. | |
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THE NUMBERS
Americans age 45 and older think they know more about long-term care (LTC) costs and how to pay for them than they actually do. And much of what they think they know may be wrong.
- When asked to estimate costs for a variety of services, only small numbers of those surveyed came within 20% plus-or-minus of available data.
- When asked whether or not Medicare, Medigap/Medicare supplemental insurance, or Medicaid/Medi-Cal covers various types of long-term care, many often think that funding sources are available when they are not available.
- Many 45+ Americans believe they have LTC coverage when they probably do not, and may be confusing LTC insurance with other types of coverage, such as disability insurance or Medicare.
The study was conducted - and the report prepared - for AARP by Roper ASW. Survey data were gathered through telephone interviews with a national random sample of 1,800 age 45+ adults between July 20 and August 14, 2001. In addition, state-level data were gathered from July 27 to August 21 via telephone interviews with a random sample of 400 people in each of the following states - California, Florida, New Mexico, Washington state and Wisconsin. (127 pages)
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CannonMurrayLaw, llc.
575 Turnpike Street #12
North Andover, MA 01845
Phone 978-989-9999
Fax 978-989-0089 and 85 Eastern Avenue Gloucester, MA 01930 Phone 978-473-1631 Fax 978-910-0302
ray@cannonmurraylaw.com
bridget@cannonmurraylaw.com
Admitted
Massachusetts Bar
Minnesota Bar
United States Tax Court
Federal District Court of MA
United States Supreme Court |
3 YEAR REVIEWS
We encourage you to take advantage of our free one-hour consultation to review your estate plan on your plan's third year anniversary.
Please call
978-989-9999
for an appointment.
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Please feel free to forward this Newsletter to your family, friends and associates who may be interested in a one-hour free consultation to discuss these topics.
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SHOULD JANE DEED HER HOME TO HER DAUGHTER?
Jane called and told me that her bridge club friends had advised her that deeding her home to her daughter would avoid probate. She asked me if I thought it was a good idea.
I told Jane that before doing so she should consider a number of issues: First, the deeding of the home to her daughter is a gift, both for federal gift tax purposes and for Medicaid purposes. If Jane's estate is less than $5.34 million then there will be no gift tax, but Jane would need to file a gift tax return. Second, the gift is a "disqualifying transfer" for Medicaid purposes and carries with it a five year look-back. If Jane, now in her 60's, needed to be placed in a nursing home during the five years following the house transfer, then she may not be able to qualify for Medicaid.
In addition to the above, by giving her daughter the house, the house will now be at risk for the daughter's liabilities, such as divorce, negligence, bankruptcy and the like. If the daughter is not living with her, then the daughter will not be able to declare a homestead which would afford $500,000 of liability protection on the home.
If Jane gives her daughter her entire interest in the house, then the daughter will take Jane's tax basis in the house. When the daughter determines to sell the house, she will not be eligible to claim a capital gains exclusion as the house is not her primary residence.
Lastly, and not the least important, giving the daughter the house either in her name solely or jointly with Jane gives the daughter the right to transfer her interest to a third party without Jane's permission or knowledge. The daughter could also take out a mortgage on the house, again without Jane's knowledge or permission.
Lesson: In addition to the issues discussed above, there are a number of other legal issues to be considered when deciding whether to transfer an asset such as a house. You should always contact a qualified attorney before doing so.
If you are new to the Jane Chronicles, you may read past issues by going to our website:
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The Alzheimer's Association, with headquarters in Watertown, has regional offices in Springfield, Raynham, and Worcester, MA and Bedford and Lebanon, NH. The Alzheimer Association provides services and programs for those with Alzheimer's, family and professional caregivers in the form of support groups, a 24/7 Helpline, care consultation, advocacy efforts, research funding and education programs. For more information about Alzheimer programs, visit www.alz.org/MANH or call 617.868.6718
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The cost of a caregiver for a dementia patient qualifies as a medical expense. The payments are for qualified long-term care services, the Tax Court says.
In this case, a mother was diagnosed with the disease and her doctor determined that she needed 24-hour supervision. Her son hired caregivers to assist her.
Although the caregivers were not licensed health care providers, the payments to them
are medical expenses. Her doctor certified that her
dementia endangered her health because she otherwise would not take her medications (Est. of Baral , 137 TC No. 1).
The break is not limited to dementia patients. The cost of maintenance and personal care services qualifies as a medical expense for patients who are certified
by a health care professional as being unable to do at least two of the six activities of daily living...eating, toileting, transferring, bathing, dressing and continence.
The certifying professional can be a doctor, registered nurse or licensed social worker. In addition, that person is required to approve the care program for the patient.
Source: Kiplinger Tax Newsletter, July, 2011
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