How Can I Leave Assets To My Spouse Free of the New York Estate

How Can I Leave Assets to My Spouse Free of the New York Estate Tax? www.myestateplan.com 1

“You may be aware of the fact that Medicaid is a government health insurance program that is in place to

provide a health insurance safety net for people who are in possession of very limited resources.”

HOW CAN I LEAVE ASSETS

TO MY SPOUSE FREE OF

THE NEW YORK ESTATE

TAX?

MARK S. EGHRARI NEW YORK ESTATE PLANNING ATTORNEY

http://www.myestateplan.com/



You may be aware of the fact that

Medicaid is a government health

insurance program that is in place to

provide a health insurance safety net

for people who are in possession of

very limited resources. As a person

who will qualify for Medicare

eventually, you may wonder why

Medicaid would enter the picture

when you are looking ahead toward

your retirement years.

This is a perfectly valid point of view.

However, Medicaid does become

very important to many elders,

because Medicare does not pay for

custodial care. If you were to require

living assistance, this would be looked upon as custodial care rather than medical

or convalescent care. Medicare pays for up to 100 days of convalescent care, but it

does not pay for custodial care.


As you may imagine, living assistance is very expensive around the country, and

long-term care costs in New York are higher than the national averages. In the

Empire State, the average cost for a year in a nursing home exceeds $100,000. A

government survey that was conducted a few years ago found that the average

length of stay is around two years and three months. Ten percent of nursing

home residents remain in

the facilities for at least

five years.

Once you hear about the

fact that Medicare does

not pay for long-term

care, and you look at

these expenses, you may

cross your fingers and

hope that you never need

long-term care. Of course, we would all like to be able to handle all of our own

day-to-day needs for the rest of our lives.

Unfortunately, the statistics would indicate that the finger crossing is unlikely to

do much good. The United States Department of Health and Human Services

maintains a very useful website called LongTermCare.gov. According to this

website, 70 percent of people who are reaching the age of 65 will need living

assistance eventually.

Medicaid will pay for long-term care. This is why the program is relevant to many

senior citizens at some point in time.


MEDICAID ASSET LIMIT

Everything that you own is not considered to be an accountable asset for

Medicaid purposes. However, the limit on countable assets is $2000 for an

individual applicant.

At this point we should provide a rundown of assets that are not considered to be

countable, and we will start with the biggest one. Your home is not looked upon

as a countable asset, but there is an equity limit. This limit is increased every year

to account for inflation, so it

could be slightly higher next

year, but in 2015 the limit is

$828,000.

Your wedding ring, your

engagement ring, and any

heirloom jewelry that you

may have would not be

countable. Whole life

insurance is life insurance

with a cash value. You can

have a whole life insurance

policy valued at up to $1500. Medicaid will allow unlimited term life insurance,

because you cannot cash in this type of insurance when you are living.

One vehicle that is used as a primary source of transportation is not countable,

and your household belongings and personal effects are not countable assets.


We touched upon the equity limit for home ownership. If you are married, and

your spouse is remaining in the home when you enter a long-term care facility,

there is no equity limit at all.

Your spouse may also retain ownership of half of the shared countable assets.

This is referred to as the Community Spouse Resource Allowance. There is

however a limit, and in

2015, the maximum

Community Spouse

Resource Allowance in

New York is $119,220.

The minimum is $74,820

.

Your income would have

to go toward the cost of

your care if you are single

and you are applying for

Medicaid, but if you are married, your spouse could continue to draw from the

income if it is needed. This is called the Monthly Maintenance Needs Allowance,

and the maximum allowance is $2,980.50; this is also the minimum.


SUMMARY

Medicaid is a government health insurance program that will pay for long-term

care. Since Medicare does not pay for living assistance, this program is relied

upon by many seniors who need help with their day-to-day needs.

There is an asset limit of $2000 for an individual, but many things that you own

do not count.

You could potentially give countable assets to your family members before you

apply for Medicaid. This is easier said than done, because the rules are complex.

To get all the facts, schedule a consultation with a licensed elder law attorney.

REFERENCES

Social Security Administration http://www.ssa.gov/retire2/credits1.htm Medicaid http://www.medicaid.gov/ U.S. Department of Health and Human Services http://longtermcare.gov

http://www.ssa.gov/retire2/credits1.htm

http://www.medicaid.gov/

http://longtermcare.gov/


About the Author

Mark S. Eghrari

Mark S. Eghrari is an attorney in private practice in Smithtown, New

York. He has been in practice since 1988. Mark S. Eghrari provides

extensive estate and tax planning services to individuals and

businesses. Mr. Eghrari’s primary focus is helping clients avoid

probate, minimize or eliminate Federal and State Estate taxes and

protect their assets from the high cost of nursing care, if they become

ill. Mr. Eghrari’s expertise is in providing unique and innovative

estate planning solutions that create a secure future for his clients and their loved ones. Mr.

Eghrari is a member of the American Bar Association and New York State Bar Association as

well as the National Academy of Elder Law Attorneys and the American Academy of Estate

Planning Attorneys.

Mr. Eghrari completed his undergraduate work at Lafayette College in Easton, Pennsylvania

and received his MBA in banking and finance from Hofstra University on Long Island. He

earned his Juris Doctorate from the Hofstra University School of Law, where he was a member

of the Law Review. While in law school, Mr. Eghrari gained practical experience in the

corporate tax department of Citicorp in New York city.

Mark S. Eghrari and Associates PLLC www.myestateplan.com 50 Karl Avenue, Suite 202 Smithtown, NY 11787 Phone: (631) 265-0599 Fax: (631) 265-0754
