Legal-Ease: Nursing homes and assets other than real estate

Being eligible for Medicaid is often a key component to a person’s long-term care plan if the individual wants to protect assets from being used for long-term care. The two primary requirements to be eligible for Medicaid, which we touched upon in this blog post, are as follows: The applicant must have a financial net worth of less than $2,000, and the applicant must not have given anything away in the previous five years to be at that financial level.

For assets that could incur capital gains taxes when sold, giving the asset away before it’s time to consider needing long-term care can miss a chance to avoid capital gains taxes.

Capital gains taxes can be minimized for many assets if they are not given away until the owner’s death.

Medicaid eligibility is frequently a key component to a person’s long-term care plan if the person wants to protect assets from being used for long-term care. Among many other requirements, there are two primary requirements to be eligible for Medicaid. First, the applicant must have a financial net worth of less than $2,000. Second, the applicant must not have given anything away in the preceding five years to become that poor.

People may prepare by simply giving assets away at least five years before applying for Medicaid. This method works well unless the asset is one for which capital gains tax would be owed when the asset is sold.

Read more about long-term care and assets other than real estate in Lee’s article in the Lima News here: Legal-Ease: Nursing homes and assets other than real estate

Source: LimaOhio.com, “Legal-Ease: Nursing homes and assets other than real estate,” by Lee R. Schroeder, February 24, 2018

Lee R. Schroeder is an Ohio licensed attorney at Schroeder Law LLC in Putnam County. He limits his practice to business, real estate, estate planning and agriculture issues in northwest Ohio. He can be reached at [email protected] or at 419-659-2058. This article is not intended to serve as legal advice, and specific advice should be sought from the licensed attorney of your choice based upon the specific facts and circumstances that you face.

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