In social functions, I always get asked about the new Medicare nursing
home qualifications. Seniors become very anxious about having to
spend-down their assets with no cap on the amount that they can
keep. This unlimited drain on their funds is of major concern to
the healthy spouse, and because the sick spouse can’t do anything about
getting sick, they become more and more depressed. These folks
are of the World War II generation and the market crash of 1929
mentality. If you don’t have the cash you don’t buy it.
Most of them got a credit card only because they had to pay their
prescriptions over the mail.
Their health and well-being depends on knowing that they can tap into
their resources to get what they need or when their grandkids come to
visit they want to reward their visit with a few bucks. My mother
is of this vintage, and I know that when my kids drop in for a visit,
it makes her day. She wants to give them something in return, not
because it’s an enticement to come back, but she doesn’t get out enough
visits and she values their time, especially in this day of instant
gratification with Ipods, Internet, cell phones, video, etc. and
because they valued their grandmother more.
So, how can I hide my assets from Medicare is relevant to their
lives. My answer is that if they did not do something as far back
as five years ago, chances are that trying to do something now, could
very well be considered a fraudulent conveyance in order to defraud a
potential creditor. For example, if they were to put their son or
daughter on the deed of the house without adequate consideration, it
would be considered a" fraudulent conveyance" because they did it for
less than the fair market value, they received nothing back in
return. Or, if they did recognize that they gave away the house
to their children it was a taxable gift and taxes are due on the
transferor (the person giving the gift has to pay the tax, the person
receiving the gift is always after taxes). But like many people
they don’t think it through in terms of filing of a gift tax return or
fraudulent conveyance. They just do it for their convenience.
The new Medicaid spend down provisions are very restrictive. The
intention is that if you (the elderly) have assets, before you qualify
for nursing home assistance, they want you to become a welfare
recipient. And that’s what seniors are afraid to become.
Their generation never asked for assistance if they had a strong back,
they worked for their dignity. They don’t want to become “welfare
recipients" it a very humiliating concept to them.
Most common mistakes committed by seniors when trying to hide their assets:
1. Naming their children as (Parent’s name “and"
Child ‘s name) (Parent name “or" Child’s name) on their savings,
checking, investment accounts, or near cash accounts. THIS IS NOT
A GOOD IDEA. Too much risk, what if child gets sued, or divorced,
or worse dies. You open a new can of worms.
2. Give the house to the children. You name one
or more of the children. Again not a good idea. What if the
children get sued, divorced, or prematurely dies. There’s too
much risk.
3. Cash under the mattress, in between the walls, in
the basement, etc. Well it works, but unless you tell someone the
hiding place, then what? Or, leave the cash to lose interest or
depreciate with inflation?
In God we Trust.
Trusts are the most common and useful legal devices. An
“Irrevocable Trust" works best for hiding your assets. Your
assets are RE-POSITIONED from you to an irrevocable trust. You
“legally" no longer own the assets. This involves the actual
transfer of assets to an independent trustee who will independently
manage and actually own the assets for the benefit of all
beneficiaries. This type of control over assets is not new, it
goes back to medieval times when landlords went off to the crusades and
left their lands in trust of monks for when they returned. There
are specific laws and it’s generally accepted by the judicial system as
a legal, acceptable method of protecting one’s assets for legal
protection and tax minimization.
Rocco and his team of bonded professional attorneys, CPAs and accountants help affluent individuals and companies retain control of their domestic and foreign/offshore assets, protect their assets, build & preserve their wealth and financially structure their money to reduce capital gains taxes, estate taxes, inheritance taxes, avoid the probate process and decrease income taxes. -------------------------------------------------------------------------------- Rocco Beatrice, CPA, MST, MBA, Award-winning trust & estate-planning expert 71 Commercial Street #150 Boston, MA 02109 tel: 508.429.0011 fax: 508.429.3034 Click here for more info: http://www.UltraTrust.com, http://www.UltraTrust.com/sitemap.html
Disclaimer: All information on this site is provided for informational purposes only! By no means is any
information presented herein intended to substitute for the advice provided to you by any health care or other professional
or organization.
