| | |
|  |   | |
 | |  |
 | |  |
| | |
| | |
|   200 St. Andrews Road
Saginaw, MI 48638 Phone: (989) 792-9641 --------------------------------- 140 W. Tuscola St., Suite B Frankenmuth, MI 48734 Phone: (989) 652-9923  |
|
Medicaid Planning & Disclaimers |
Dear Colleague:
An effective and useful tool in estate planning is the ability to disclaim an interest in property. However, in planning that involves a Medicaid applicant, careful determination needs to be made as to the treatment of the disclaimer for Medicaid eligibility.
If a Medicaid applicant is entitled to receive from an inheritance, whether by beneficiary or bequest, a disclaimer of this asset could be a divestment, pursuant to the Program Eligibility Manual. A divestment is a transfer of an asset for less than fair market value. This could result in a period of ineligibility.
If a Medicaid applicant is entitled to receive income from an inheritance, such as an annuity, and they give up this right to receive the income by disclaimer, a value is placed on the total amount of income the person could have expected to receive. This could also be treated as a divestment and may result in a period of ineligibility.
While a client may not be receiving Medicaid at the time of contemplating a disclaimer, there will be a five-year look-back for Medicaid applicants pursuant to the Deficit Reduction Act. The consequences of a disclaimer during this five-year period would also need to be discussed as to the penalty and ineligibility period that may result.
Smith Bovill, P.C. counsels clients on elder law and Medicaid planning issues regularly as part of its estate planning, probate, and trust administration practice. This letter, as well as all prior letters, are posted on our website at www.smithbovill.com. Please check our website for any updates to this newsletter and additional information regarding elder law. This letter, and the information on our website, is intended for informational purposes only. As a result of the constantly changing laws in the Medicaid area, the information provided may change. We would be pleased to discuss this, or any other Medicaid or elder law issues, in more detail.
SMITH BOVILL, P.C.
|  | | |
| | |
| | |
| | |
 | |  |
|
The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. Copyright © 2010 by SAGINAW: (989) 792-9641 FRANKENMUTH: (989) 652-9923. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement. |