How Does Medicaid Treat the Purchase of a Life Estate?
We live in NJ. My dad broke his hip from a car accident, went through therapy, came home to his house, and fell down his s...
Read moreWhen facing the decision to sell a parent's home, especially when considering inheritance and caregiving, it's important to understand the tax and financial implications. Here are some key factors and strategies to consider:
You're currently caring for your 95-year-old father in his home. As you prepare to move him into your house and sell his property, you're exploring the best way to handle the sale from a tax perspective. You've also mentioned that you and your sister are named in your father's will and trust to receive the house and financial assets upon his death.
It is highly recommended to consult with a qualified estate planning attorney and a tax advisor or certified public accountant (CPA). They can provide personalized advice based on your specific situation, including:
Capital gains tax is a tax on the profit from the sale of an asset, such as a house.
A stepped-up basis is the fair market value of an asset at the time of someone's death, which becomes the new cost basis for the inheritor. The cost basis is adjusted from what the asset was valued at when the owner originally purchased it to its fair marked value on the date they died, so it could be lower or higher, but is more often the latter.
This depends on your specific situation. Consulting with a tax advisor and estate planning attorney is essential.
This response is for informational purposes only and does not constitute legal or financial advice. It is essential to consult with qualified professionals for personalized guidance.
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Read moreIn addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. Coverage in your state may depend on waivers of federal rules.
READ MORETo be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). Special rules apply for the home and other assets.
READ MORESpouses of Medicaid nursing home residents have special protections to keep them from becoming impoverished.
READ MOREIn addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. Coverage in your state may depend on waivers of federal rules.
READ MORETo be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). Special rules apply for the home and other assets.
READ MORESpouses of Medicaid nursing home residents have special protections to keep them from becoming impoverished.
READ MORECareful planning for potentially devastating long-term care costs can help protect your estate, whether for your spouse or for your children.
READ MOREIf steps aren't taken to protect the Medicaid recipient's house from the state’s attempts to recover benefits paid, the house may need to be sold.
READ MOREThere are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home.
READ MORECareful planning for potentially devastating long-term care costs can help protect your estate, whether for your spouse or for your children.
READ MOREIf steps aren't taken to protect the Medicaid recipient's house from the state’s attempts to recover benefits paid, the house may need to be sold.
READ MOREThere are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home.
READ MOREMost states have laws on the books making adult children responsible if their parents can't afford to take care of themselves.
READ MOREApplying for Medicaid is a highly technical and complex process, and bad advice can actually make it more difficult to qualify for benefits.
READ MOREMedicare's coverage of nursing home care is quite limited. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid.
READ MOREMost states have laws on the books making adult children responsible if their parents can't afford to take care of themselves.
READ MOREApplying for Medicaid is a highly technical and complex process, and bad advice can actually make it more difficult to qualify for benefits.
READ MOREMedicare's coverage of nursing home care is quite limited. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid.
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