Medicaid Planning: How to Protect Your Assets
- Will or Trust, Durable Power of Attorney and Health Care Power of Attorney. Even after a loved one has moved into a nursing home, legal strategies can be used to protect assets. Generally this will require having a suitable durable power of attorney.
- REVOCABLE TRUST. For a married couple, having your assets including your home titled in your revocable trust before being admitted to a hospital or nursing home can in some instances, protect additional assets.
- IRREVOCABLE TRUST. Assets in an irrevocable trust are exempt under the Medicaid rules. However, there is a 5 year look back period for any transfers into an irrevocable trust.
- PRE-PAY FUNERAL EXPENSES A pre-paid funeral plan (if done correctly) is an exempt asset under the Medicaid rules.
- GIFTING OR TRANSFERRING ASSETS. The gifting or transferring of any assets for less than fair market value within the 5 year look back period will cause a penalty under the Medicaid rules.
- CONVERTING COUNTABLE ASSETS TO EXEMPT ASSETS. In addition to a pre-paid funeral, other assets are exempt (not counted) under the Medicaid rules. These include: 1 home, 1 car, life insurance up to $1500.00, personal and household items and $2000.00. Buying a new car or undertaking home repairs or improvements are allowable.
- PAYING BILLS OR OTHER PERSONAL EXPENSES. Paying credit card bills, mortgages, car payments, or other personal expenses are permissible under the Medicaid rules.
- TRANSFERS TO NON-SPOUSES. The Medicaid rules provide that certain gifts or transfers are not subject to the penalty rules. These include transferring a home to a caregiver child (must live in and provide care in the home for at least 2 years) or transferring any assets to a blind or disabled child.
- ESTATE RECOVERY. Estate recovery allows the state to seek reimbursement from the estate of a Medicaid recipient after the person dies. In 2007, Michigan became the last state in the nation to adopt an estate recovery law. Beginning in July of 2011, Michigan began enforcing its estate recovery law.
- GET HELP FROM A MEDICAID EXPERT. There is no magic bullet when it comes to Medicaid planning. Typically, one or more strategies are used to protect assets depending on the individual circumstances. However, nearly everyone knows someone who claims to have some personal knowledge about Medicaid planning. In my experience, the majority of time this advice is incorrect and actually causes additional problems. Medicaid is a complicated area of law that is frequently changing. With so much at stake, it is foolish not to consult with people who make a living guiding clients through the Medicaid planning process.
Heather Kirson and Patricia Fuller, the founders of the Elder Law Center of Kirson and Fuller, help Florida families protect their estates. Whether you are worried about nursing home expenses that exceed on average $7,000.00 per month, assisted living expenses, having your estate avoid probate court or planning for a special needs child or grandchild, Heather & Patti have helped hundreds of families obtain peace of mind when faced with such issues. Contact our office by calling (407) 422-3017 to schedule a confidential consultation. Article Source: http://EzineArticles.com/?expert=Brett_A_Howell