Life Care Planning is a Family Affair. Whether your loved one is a parent, spouse or special needs loved one . . . whether you live with your loved one, in the next town or across the country . . . dealing with an elderly or disabled loved one can cause countless sleepless nights. The experienced, supportive and knowledgeable attorney, geriatric care manager and support staff at the Litherland, Kennedy & Associates, APC, Attorneys at Law realize that most people are caught up in today’s hectic … [Read more...] about Life Care Planning – What is It and Who Needs it?
Veteran’s Health Administration — The Veteran’s Health Administration provides benefits for a variety of health and long-term care needs. These services are available to anyone with prior service (excluding anyone with a dishonorable discharge). In order to receive these benefits, a veteran is required to get a physical and it generally takes one year to enter the VA health care system. Priority is given to Veterans with a service-related disability, former POWs, and retired military personnel. … [Read more...] about Veteran’s Health and Benefits Administration
A family came to me with a difficult Medi-Cal planning situation. Their mother had recently been advised that the mother’s aunt had died and she was about to inherit around $600,000. Normally that would not be a bad thing, however, in this case, it would be a good thing with potentially negative economic consequences. It seems the mother was gravely ill, even though reasonably young. But due to her medical condition, she was confined to the sub-acute care unit of a skilled nursing home and the … [Read more...] about Difficult Medi-Cal Planning Situation Involving Inheritance Resolved
Since an individual applying for Medi-Cal can’t qualify for Medi-Cal to pay for skilled nursing home care if they own non-exempt assets exceeding $2,000, many persons are tempted to simply “gift away” the excess. The “look back rule” provides that if a person makes gifts of assets within a certain period of time prior to applying for Medi-Cal and hopes thereby to qualify for Medi-Cal, they are denied Medi-Cal for some period of time based upon a mathematical formula. The period of the look back … [Read more...] about What is the Medi-Cal “look-back rule”?
What needs to be done to administer a Living Trust when the trust creator (“Trustor”) passes away? Well, it could be virtually nothing at all, or it could be very involved. If the Trust only holds cash assets and stocks, it might be limited to distributing the cash and stock among the Trust beneficiaries. If it holds real property which is intended to be sold immediately, the title company will take care of much of the paperwork required at close of escrow, perhaps leaving only the distribution … [Read more...] about Administration of a Living Trust
Non-qualified annuities and life insurance can now be tax-free exchanged for long term care insurance (“LTCI”). This is huge because benefits paid out of a LTCI policy are paid out tax free. Example, Fred has an annuity. Right now he doesn’t need the income, but he expects the after tax stream of annuity payments will not be enough to pay for the in-home support services he might need to stay in his home. He can exchange this annuity for LTCI which might pay out benefits as much as 4 to 5 … [Read more...] about Tax-Free Exchange of Non-Qualified Annuities and Life Insurance for Long Term Care Insurance
In a 2-1 split decision, a recent Court of Appeal agreed with the IRS that an FLP with holdings that consisted only of Dell corporation stock had no legitimate business purpose, but was primarily an estate planning device. The dissenting opinion disagreed stating that maintaining family control is a legitimate business purpose. If the underlying asset had not been a highly liquid, publicly traded stock, I might agree with the dissenting opinion, but I have to ask myself how some members of the … [Read more...] about 2nd Update – Valuation Discounts – Thomas H. Holman Jr. et ux. v. Commissioner; No. 08-3774 (7 Apr 2010)
While not earth shattering, a Court of Appeal just issued a ruling in the above referenced case. First, in the facts are that parents created an FLP and transferred into it their substantial holdings of Dell stock. Five days later, they gifted some of the FLP ownership interest to their children. When they filed their gift tax return they claimed valuation discounts. The IRS argued that the transfer of the FLP interest was tantamount to a gift of the Dell stock and thus no valuation discounts … [Read more...] about Update valuation discounts – Thomas H. Holman Jr. et ux. v. Commissioner; No. 08-3774 (7 Apr 2010)
A family limited partnership (FLP) is not uniquely different from a limited partnership except that the participants are generally limited to family members and an FLP is often structured to receive special estate tax treatment. However, I personally haven’t created a limited partnership in years. Why? A limited partnership is required to have one or more limited partners, and one or more general partners. The general partners have UNLIMITED liability for the partnership debts, so any time you … [Read more...] about Family Limited Partnerships
The recent health care legislation includes several provisions which are intended to amend the Medi-Cal law. As you know, Medi-Cal is the federal law which enables each state to pass its own version of public assistance and to fund the resulting programs. The federal government made amendments to the Medi-Cal law in 1993 (OBRA) and 2006 (DRA) which of course included requirements to compel each state to conform. Notwithstanding, California has done little to implement either the 1993 or 2006 … [Read more...] about Health Care Reform and Medi-Cal