Starting January 1, 2018, the Tax Cuts and Jobs Act increased federal estate and gift tax exemptions to approximately $11 million. While the exemptions sunset on January 1, 2026, you can still benefit by making gifts up to $11 million while you are alive. Married couples will be able to give away up to $22 million. Since Congress could repeal this tax law, it’s important to ache When it comes to retirement and nursing home planning, there is a complicated set of laws governing how and when assets can be used. What can be even more frustrating is that these laws are always changing.
In order to avoid having all your assets spent down for nursing home expenses or being penalized, it is best to consult with an experienced elder law attorney Grand Rapids Mi.
There are many factors that can affect how you and your elder law attorney decide what nursing home asset protection plan is best for your unique situation. Some of these factors are listed below and explained in more detail.
Being married or single can make a big difference when it comes to making nursing home asset protection plans. For example, the procedure for married couples signing up for Medicaid can be drastically different from single individuals.
For this reason, it is important to have an experienced attorney help you through this process. Both married couples and single individuals can benefit from asset protection strategies that work for their specific circumstances. Since laws concerning retirement assets and Medicaid eligibility are always changing, it is not recommended that you try and go it alone.
If you plan on gifting any of your assets to trusted family members, please keep in mind that this could create problems when you apply for Medicaid. The government looks back five years into your financial history before approving you for Medicaid.
If they find any evidence of gifting assets, they will impose a penalty, which will prevent you from being eligible for Medicaid for a certain number of months. This Medicaid penalty period is calculated by taking the amount of gifted money and assets and dividing it by the average cost of nursing home care in your state.
While it can be tempting to invest in pre-paid funeral plans, cars, and home improvements, it is best to meet with a qualified elder law attorney first. Wrong timing could mean the loss of tens of thousands of dollars.
If you are interested in our asset protection service, please feel free to call the Law Offices of Sean Patrick Cox, PLLC to schedule your free consultation with one of our elder law attorneys serving Grand Rapids, Kalamazoo, and West Michigan.