Does anyone specialize in the subject or know of someone who does? I am looking for some advice regarding asset preservation, etc. when it comes to planning for long-term care. Particularly in a situation where there is no long-term care insurance in place. Thanks.
Elder Care / Estate Planning Legal Advice
- Thread starter jeff0514
- Start date
I am not a lawyer so I can't answer technical questions but we just had this exact conversation with my parents and their trust officer and attorney... estate, will, long-term care, etc.
Thanks. I actually went through this earlier this year, but am interested in other opinions on asset preservation / medicaid eligibility (assuming that it will be around). In particular, are there ways to preserve a family farm if they are already in a long-term care facility?
You need to get the Medicare clock ticking. If I remember the waiting period is five years. Ask about starting to transfer some property but where neither party can sell,mortgage, etc. And the grantor has full access to the property. If you are needing immediate help to protect a property this isn't going to be much help.
Yes, most farmers are not in that ballpark of assets. If they are, the parents set up an irrevocable trust today and they don't need LTC for 5 years, everything in the trust will be sheltered from the medicaid look-back. They can still farm the land, collect rents, etc., and upon passing the land goes to the kids. It's a very common concept.
Thanks for the input. I'm already very familiar with the 5 year look back period. My parents entered a long-term care facility earlier this year and have cash to pay for 5-6 years based on their current arrangement (mom in the care facility, dad in assisted living). Of course, if he would need more care that would change. Their remaining assets primarily consist of their small farm that I would conservatively estimate valued at $700-800K at today's farmland values. The house and buildings aren't worth much. Its a Century Farm, so would be nice to keep in the family.
Those paying privately in a nursing home versus those being paid by Medicaid.
The nursing homes I have been to, they get the same care. I have never seen differentiation in care between those paying privately and those Medicaid is paying for.
To add to my last post... they were retired from farming, so only cash rent right now. They weren't very sophisticated, so they never did much in the way to estate or long-term care planning. I coordinated getting their wills updated earlier this year with an attorney they were familiar with. We elected against setting up a trust due to their smaller estate size. We simply made sure all assets were owned joint tenancy so we only have to go through probate once. But I have been wondering if we should look at an irrevocable trust for the farm and leave their cash balances to pay for nursing home / assisted living costs in an effort to protect the farm. We are on the borderline of the five year look back from my estimation, as I think they could have enough cash left to pay for 5 years. It would be close, depending on how much the nursing home bill goes up each year.
I am an estate planning attorney in Central Iowa. I would warn you that Title 19/Asset Recovery is very nuanced and one misstep can be very costly. There are a few very good attorneys in the Des Moines area that specialize in preserving assets through such things as gifting, irrevocable trusts, etc. DM me and I'd be glad to give you their names.
so... interesting question @Clonefan32
the estate tax exemption is 5.5m per person or 11m per couple. 99.9 of couples don't die at the same time so if one spouse dies and leaves their half to the remaining spouse, how can the deduction be anything but 5.5m? like, how does the exemption double except in the rare case of both spouses dying at the exact same time?
the estate tax exemption is 5.5m per person or 11m per couple. 99.9 of couples don't die at the same time so if one spouse dies and leaves their half to the remaining spouse, how can the deduction be anything but 5.5m? like, how does the exemption double except in the rare case of both spouses dying at the exact same time?
You each get 5.5 mm or whatever it currently is. You just make your will, pass your half to your kids with a life estate to your spouse so they can collect income, live in the house etc (just can't sell anything) until they pass and at the seconds passing the first half passes completely to the kids.
I've never personally had this come up, but I imagine you would open an estate for one spouse (if you could somehow determine who passed first it would be that spouse), file a Federal 706, elect portability to maximize that spouse's exemption, transfer all assets to the second spouse's estate to administer and distribute.
Just a guess though as I've never researched this nor had it come up. With the exemption as high as it is, you just don't see a ton of Federal Estate Tax returns being filed.
My wife and I did what I mentioned above so if one dies, the other doesn't remarry a dirt all who takes a bunch in a divorce or gives it to their kids. My wife is very naive and trusting. Allows my kids not to get accidentally hosed.
Edit:. You seriously have not dealt with working through life estates for a spouse?
I certainly have seen them. Alot of people are utilizing trusts instead of life estates these days. Like any profession, certain attorneys prefer to set things up certain ways. Not a right or wrong way to do it.
There are many concepts and potential priorities being jumbled together in this thread:
1. Medicare eligibility
2. Avoidance of estate tax (as noted by Clonefan32, rarely an issue due to the size of the exemption and portability between spouses)
3. Assuring offspring receive share of inheritance in the event that Spouse 2 remarries following Spouse 1's death.
