One of the most common concerns of our aging clients is the fear of losing their family home if they need full time nursing care. There seems to be an inclination to transfer the family home to someone else, usually a family member, as quickly as possible to keep the home from being sold. This may sound like a smart idea, but it simply doesn’t work in most circumstances.
Losing the family home is a legitimate concern but one that you should not try to address without the assistance of an experienced elder law attorney. Here are a few of the problems you can encounter if you don’t abide by Kansas law and Medicaid rules:
1. Gift Tax Consequences. Unless the appraised value of your family home is $15,000 or less (the 2019 annual gifting allowance), when you transfer your family home to someone else, you will be required to file a gift tax return and may be subject to a gift tax.
2. Medicaid Reimbursement Claim. If you require full time nursing home care and are counting on Medicaid benefits to cover the cost of your care, transferring your residence to someone else shortly before moving to a nursing home facility will likely result in a problem. Medicaid works on the theory that assets (your family home, for example) that otherwise could be used to pay for your care should not be given away within the five year period prior to requesting the government (Medicaid) pay for nursing home benefits. This period is called the five year look-back. Unless the gift recipient fits certain, clearly specified exceptions, the government will assess a penalty period before they will contribute to your nursing home care if you have made a gift within the five year look-back. During the penalty period, you will be required to private pay for the cost of any nursing home care that you receive.
We often talk about the proverbial “crystal ball” in our office. If only we knew when our death will occur, we could wait until the last minute to get our affairs in order. Unfortunately (or maybe fortunately), very few of us receive notice that our death is imminent while we are healthy enough to take care of these things. Perhaps we receive a terminal diagnosis, but we believe we’ll “have more time” to take care of the details involved in our estate. Or, we pass away due to an unforeseen accident. The reality is we “think” about getting our estate in order but, time seems to slip away. We encourage everyone to assemble these important documents during their younger years, so when a health crisis or death occurs, there is one less stressor on the family.
Here are some helpful tips we gathered from the National Institute on Aging, as well as some of our own, that may assist you in getting your affairs in order:
1. Gather important papers and keep them in one place. Create a file and place everything in a desk or dresser drawer. Notify a trusted family member or friend where these papers are located. You also can notify your lawyer as to their location. You may wish to list the information and location of papers in a notebook. If your original papers are in a bank safe deposit box, keep copies in your home file. Check each year to see if there is anything new to add.
2. Give permission in advance for your doctor or lawyer to talk with your caregiver as needed. There may be questions about your care, a bill, or a health insurance claim. Without your consent, your caregiver may not be able to get needed information. You can give your approval in advance to Medicare, Medicaid, or your doctor. A HIPAA authorization form and/or Health Care Power of Attorney may be used to accomplish these tasks.
Elder law may not be on your radar yet. However, if you live long enough, it will be. May is designated as National Elder Law Month and is sponsored by The National Academy of Elder Law Attorneys (NAELA) specifically to draw attention to legal issues related to seniors and their families. As you or your aging parents encounter an increased need for legal and financial assistance, you will find elder law attorneys can help with a wide range of legal topics, including healthcare directives, financial powers of attorney, long-term care planning, Medicaid planning, guardianships, special needs planning, and similar matters.
You or your parents may not feel the urgency for legal guidance in any of these areas today, but with the passing of time, it will become more relevant. There is significant risk involved by waiting to develop a long-term care plan. If you wait until the point when you realize an elderly parent can no longer manage his or her money, or their health has declined so much that immediate intervention is necessary, then the pressure is suddenly on to act quickly to prevent significant losses, which often results in higher costs and more difficulty in the planning process. Rarely are optimal decisions made in high-pressure situations. Advanced planning provides you the peace of mind that in the event of something unforeseen, you have a plan in place that will immediately meet the needs of the senior. It also is especially important for adult children who live at a distance from their elderly parent and cannot respond immediately in a crisis.
What are the key questions you should ask yourself or your aging parent when considering estate planning and long-term care planning?
Attorney Megan L. McCann, partner at the Law Office of Davis & McCann, P. A., Dodge City, Kansas, recently completed a specialized Medicaid planning course focused on solutions for individuals and families.
The course, offered by Mike Anthony, JD, CMP of Edgentus, covered an extensive review of government benefits provided by Medicaid, the rules and regulations governing those benefits, and specific techniques available to attorneys to assist clients in maximizing the protection of personal assets during the Medicaid application process. Anthony is one of the foremost experts on the subject of long-term care planning in the U. S. He also is the author of the “Medicaid Planning Guidebook,” the largest textbook on the subject of long-term care Medicaid planning.
“As baby boomers enter their advanced senior years, we’ve seen a spike in the need for assistance with long-term care planning and Medicaid applications. It’s our goal to provide affordable, high-level legal care to our clients, without them having to drive halfway across the State to receive the advice they need. We’ve offered more basic long-term care planning services for the past 2-3 years, but we believe advanced training such as this, although a sizable investment for our boutique law firm, ensures we can fulfill that commitment to our clients,” McCann says.
As elder law and estate planning attorneys, Davis & McCann, P. A. provides legal services in the areas of estate planning, long-term care planning, Medicaid planning (advance planning and crisis), and special needs planning, among others. Specialized training in these areas of law is required to provide competent service to clients and ensure proper implementation of legal strategies. The advanced training acquired by Davis & McCann, P. A. will allow them to address more advanced and complicated long-term care plans for their clients. Davis & McCann are members of Wealth Counsel, a national consortium of Estate Planning Attorneys. McCann also is a member of National Academy of Elder Law Attorneys (NAELA), one of the best professional associations that educates and trains lawyers and others on elder law matters and special needs planning.
In addition to long-term care planning and Medicaid planning, Davis & McCann, P. A. offers services in simple and complex estate planning, business and farm succession planning, business formation, probate, trust administration, real estate and more. The firm represents clients in most of the counties in Western Kansas.
In the last three weeks, we discussed the telemarketing and internet scams focused on senior citizens. To learn more about those topics, you can visit: http://www.dclawfirm.net/blog--news/why-are-retirees-easy-targets-for-con-artists-part-one, http://www.dclawfirm.net/blog--news/why-are-retirees-easy-targets-for-con-artists-part-two and http://www.dclawfirm.net/blog--news/why-are-retirees-easy-targets-for-con-artists-part-three. Today, we begin the final part in our four (4) part series on elderly financial scams. In this article, we’ll be discussing mail fraud, home repair fraud and professional fraud.
Caregivers can help monitor loved ones’ mail for potential mail fraud. Stacks of unsolicited mail with various offers for money or prizes is a quick indicator that your loved one is being targeted for a scam. Also, if you notice packages of cheap costume jewelry or other “gifts” arriving by mail to your loved one, inquire about the source of the items and the circumstances leading to their receipt.
If your loved one has provided confidential personal data, be watchful for unauthorized transactions in their financial accounts and alert their banker to the situation. Review their checkbook entries and look for unusually large withdrawals or checks written to unfamiliar companies. Credit card statements should be checked for any unauthorized charges. It’s also advisable to examine your loved one’s credit rating to
In the last two weeks, we have discussed the dangers associated with scams aimed at seniors. To learn more about those topics, you can visit: http://www.dclawfirm.net/blog--news/why-are-retirees-easy-targets-for-con-artists-part-one and http://www.dclawfirm.net/blog--news/why-are-retirees-easy-targets-for-con-artists-part-two. Today, we begin Part three (3) in our four (4) part series on elderly financial scams by diving into internet and computer scams and what you can do to protect yourself and your loved ones.
Senior Citizens have traditionally been less apt to be the subject of Internet scams because of a lack of technological savvy. However, as the Baby Boomers move fully into retirement years, we have seen an increase in the number of Internet scams, due to the group’s advanced comfort with computers.
Last week, we discussed the most common types of scams perpetrated on Western Kansas seniors. To read more, you can visit: http://www.dclawfirm.net/blog--news/why-are-retirees-easy-targets-for-con-artists-part-one. Today, we begin Part two (2) in our four (4) part series on financial scams and learn what you can do to protect yourself from a telemarketing trap.
How Can I Identify a Telemarketing Scam and What Should I Do?
These are some of the most common tactics used to commit fraud by telephone:
Urgency or Mania: A fraudulent telemarketer will scream and shout about how excited they are that you have won a prize or say something similar to, “You are the grand prizewinner, but if you don’t accept your reward immediately (and pay a “handling charge”) the runner-up will win instead.”
Authority: The telemarketer puts his “boss” on the phone, so you will know the offer is “legitimate.” The “boss” is another accomplice in the scam.
Fear of Missing Out: The prize you have won is so good, you think you can’t pass up this deal of a lifetime. This is an especially dangerous tactic tempting lower-income level seniors who already are struggling to make ends meets.
Reciprocity/Pity: The caller explains that he or she won’t get paid unless you accept the prize and pay the "handling fee". If you protest that you can’t afford the fee, the scammer asks how much you can afford, and says he or she will make a special exception for you and accept the lower amount.
Recently we presented an article on financial abuse of elderly. Today, we continue that theme by providing the first in a four (4) part series on the types of fraud attempts to which older adults often are subjected.
Why are some retirees from Western Kansas targeted for elder financial abuse and cons? In addition to slowing cognitive skills, some of these individuals have a significant amount of money sitting in their bank accounts and other financial investments, making them prime targets for swindlers. They tend to be retired, at home, answer their telephones and open their mail. According to a report by the Federal Trade Commission, 56% - 80% of telemarketing scams are directed toward senior citizens. Lest you be misled, wealthy, aging adults are not the only ones targeted. Low-income elders are at risk for financial abuse, as well. Their more precarious financial situation puts them at an even greater risk of loss of independence if the con-job is successful.
Think all scams are generated by Internet or telemarketing fraudsters? Think again. Professionals such as attorneys, financial advisers, insurance agents, and funeral homes have been found to manipulate
Financial abuse of elderly individuals is a criminal offense. Not only does this crime steal older adults of their assets, in some cases due to the drain on their assets, it steals their independence.
If you see signs of fraud, theft, or misuse of a person’s resources or credit, you should be on alert. If you suspect a person is using undue influence to gain control of a senior citizen’s assets or property, contact authorities with your concerns.
There are ways you can protect yourself or an aging loved one from fraudsters.
How To Protect Yourself As A Senior Citizen
1. Meet with your estate planning attorney and financial adviser or tax professional to create an estate plan that protects your assets and provides for your loved ones after your death. If you feel unduly pressured by friends or family members to gift them money or other assets, your attorney can prepare a trust based estate plan that will protect your assets from these uninvited requests, but still provide for all of your personal needs and expenses.
2. Select a trusted person or financial institution to act as your agent in the event you become incapacitated and need assistance with paying bills, taxes and making other financial decisions. If you name a family member or friend, you may want to consider naming two (2) individuals to share the responsibility as a way to create a checks and balances system. You should have a legal document known as a Durable General Power of Attorney prepared by your attorney to appoint someone to act as your agent. This Power of Attorney will hold an individual legally responsible for any financial misconduct committed by them while acting as your agent.
3. All financial information such as receipts, bank statements and unused credit cards should be shredded before being thrown away.
4. Never, EVER, provide your personal information, including your Social Security Number, or any financial information over the telephone unless you initiated the call and you have verified that the other party is
Because November is Long-term Care Awareness Month, for the past few weeks we’ve been talking about Medicaid planning. Those of us who work with Medicaid planning and elder care services know what Medicaid planning can and cannot do for a person, but do you?
The purpose of Medicaid planning is to preserve your assets and set up your affairs in such a way that “the State” will pay the majority of the nursing home care costs, if or when the time comes. With good Medicaid planning, you should need only to contribute your income toward nursing home care costs. With Medicaid planning, you should not need to sell assets in order to pay for your long term care. If you have a spouse, with Medicaid planning you may be able to preserve income for your spouse rather than paying it to the nursing home in certain circumstances.
NEWS YOU CAN USE
Davis & McCann, P. A.,