Joint Accounts

Joint bank accounts are usually done as a means of DIY Estate Planning. The adult child places themselves on the parents account as a technique to avoid Probate. Unfortunately, from a Medicaid standpoint this invalidates the gifting prohibition because the Medicaid applicant “gifted” half of the account to the adult child. This would need to be undone, meaning the adult child removed from the account, and then a true Medicaid strategy employed for the cash in the account.

Personal Injury and Medicaid/SSI

Personal Injury settlements could be a little difficult. The difficulty is that while the IRS does not recognize the settlement for tax purposes as income, Medicaid does recognize it as an asset. The most convenient planning technique is to create a Special Needs Trust for the Personal Injury Settlement. I handle about three to four SNT’s per month for clients receiving a personal injury settlement that are on SSI or Medicaid. A Special Needs Trust is a unique irrevocable trust whereby the money is not counted as an asset for the individual, but the money could ONLY be used for the sole benefit of the individual. Congress created this hybrid type of trust back in 1983, and it has been widely

Rental Property and Medicaid

Rental Property is a common issue with Medicaid Planning. Some applicants may have a rental property. Medicaid does not treat the property itself as an asset, only the income from the net rental amounts. This means the gross rent, minus the HOA, mortgage and any other costs is then counted as income for the applicant. The purchase of a rental property is also a Medicaid Strategy in that a countable asset as money, is transferred into a non countable asset as a rental home. The hard part is the Recovery associated with the rental property. An extra step needs to be taken to ensure that the rental property does not become part of a Probate Estate for Medicaid to attach a lien.

Countable Asset in Medicaid

What exactly is exempt from Medicaid as a countable asset? The answer is really quite simple: anything that is a non-countable asset is then a countable asset. I am not trying to be funny or clever, but it is easier is to define all assets as countable, except for the non-countable. So what does Medicaid consider as non-countable. Well, essentially it is critical assets of your life that you need in order to survive, such as your home, car, and retirement monies. Pre Paid Burial contracts are also non-countable (because Medicaid does not wish you to become a burden to your family). There are certain limitations to the non-countable assets. The home must have equity less than $552,000 (value

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(786) 463-4463

North Miami Beach, Florida