Oct
30
2018
0

Can I Give Each Of My Children $15,000 a Year and Still Qualify For Medi-Cal?

You can give $15,000 to each of your children per year under IRS rules, but there may be penalties if you apply for Medi-Cal within 30 months of the date of the gift. Under IRS rules for the year 2018, you can give away $15,000 or less to any number of individuals, without having to report the gift to the IRS. If you give away more than $15,000 in a single year to any one individual, other than your spouse, you will be required to file a gift tax return. However, you will only have to pay a gift tax if your reportable gifts exceed $11.18 million dollars during your lifetime. I do not believe that any of my clients estates’ will be liable for a gift tax.

But beware of the Medi-Cal gifting rules and the 30 month look back penalty period. Some people are of the belief that if they give away an amount equal to the current $15,000 annual gift tax exclusion amount, that this gift will be exempted from Medi-Cal’s 30 month look back penalty period. This notion is incorrect.

The gift tax exclusion is an IRS rule, and this IRS rule has nothing to do with Medi-Cal’s asset gifting rules. While the $15,000 that you gave to your grandchild this year may be exempt from any gift tax, Medi-Cal will still count it as a transfer that could make you ineligible for nursing home benefits for a certain amount of time, should you apply for Medi-Cal within 30 months of the date of the gift.

When a person is in a nursing home and applies for Medi-Cal, the Medi-Cal application will ask whether the applicant has transferred away any non-exempt assets during the 30 months prior to the application date. Transfers or gifts between spouses are not counted. However, if a gift was made to a third party within the 30 months prior to the application date, an eligibility penalty may apply. If the gift was made more than 30 months prior to the date of the application, no penalty will apply. If the gift was made within the 30 month period, divide the sum gifted by $8,841, the penalty divisor, and that is the number of months of ineligibility for the applicant, starting at the month the gift was made. So for instance, if $15,000 was gifted in June, 2018, we divide that number by $8,841. $15,000 / $8,841 = 1.69, which would be rounded down to one month of ineligibility.  As a result, the applicant would be ineligible for June, 2018, but would be eligible for July, 2018. The devisor penalty number is revised annually.

You should also review the language in your revocable living trust and financial durable powers of attorney, to be sure that there is not a $15,000 limitation on gifting, which we commonly see. If you lose capacity, and we are limited to the $15,000 annual amount for gifting, we may not be able to utilize all of the Medi-Cal eligibility regulations, and your ineligibility period for qualification for Med-Cal could be unnecessarily extended.

This information is not to be taken as legal advice, is general in nature, and you are encouraged to see your Walnut Creek Elder Law Attorney.

Michael J. Young

Walnut Creek, CA

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Mar
12
2018
0

What Are The Intestate Rights Of Inheritance In Probate Upon The Death Of A Married Person?

The rights of inheritance from a person who died intestate, and who was married at the time of death, will depend upon the nature of the particular asset being probated. Assets of the decedent who is a married person can be community property, quasi-community property or separate property.  Quasi-community property is property acquired in another state that would have been community property if it had been acquired in California. Basically, all community property and quasi-community property will pass to the surviving spouse. The separate property of the decedent will be distributed to the surviving spouse and to other relatives, depending upon who survives. So for instance, if there is a surviving spouse and surviving children, one-half will go to the surviving spouse and one-half will go to one child, if there is only one child. If there is more than one child, one-third will go to the surviving spouse, and two-thirds will go to the children in equal shares. Other rules will apply if there are no children or grandchildren.

This information is not to be taken as legal advice, is general in nature, and you are encouraged to see your Walnut Creek Probate Attorney.

Michael J. Young

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Mar
08
2018
0

What Assets Can Be Administered By The Probate Court When The Decedent’s Will Is Filed?

Only certain assets left through a person’s will can be administered through a probate proceeding.

For a married person, all of his or her separate property, which is in that person’s name alone, can be distributed through a probate court proceeding. Separate property is identified as what was owned by the decedent before marriage. In addition, separate property refers to assets acquired during marriage by gift or inheritance. If the decedent is single, all assets in the decedent’s name alone can be distributed through a probate proceeding. For community property, one-half of each asset which is titled in the couple’s names as community property can be handled through the probate court process. In addition, the portion or percent owned by the decedent with others as tenants in common can be subject to the probate court process. Assets that are not registered in the decedent’s name, such as furniture, coins and jewelry can also be distributed through probate.

This information is not to be taken as legal advice, is general in nature, and you are encouraged to see your Walnut Creek Probate Attorney.

Michael J. Young

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Mar
02
2018
0

How Long Does A Probate Usually Take?

Probate proceedings typically take about a year to complete, and can take even longer depending on the assets and complexities of the case. After the petition is filed, notices are given and probate publication is made. Probate statutory time frames must be adhered to, and apply to various aspects of the probate, including filing dates, publication and creditors’ claims. If there are creditors’ claims against the estate, the probate can take even longer in order to resolve the claims. If beneficiaries contest certain aspects of the probate, such as the amounts of distributions and which parties are to receive which distributions, the probate proceeding could take even longer. Real estate can be sold during the course of a probate administration, even though the probate is being contested. When real property is sold during the course of a probate proceeding, the proceeds of sale are distributed from escrow to the probate bank account, pending completion of the probate proceeding.

This information is not to be taken as legal advice, and you are encouraged to see your Walnut Creek Probate Attorney.

Michael J. Young

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Mar
01
2018
0

Items Generally Exempted for Medi-Cal Qualification

If you apply for Medi-Cal, the following list includes items that are generally exempted for qualification.

  • Your home is exempted if it is your principal residence. When applying for Medi-Cal, you will confirm on the application that you intend to return home after your stay in a skilled nursing facility. Medi-Cal requires a “subjective intent in writing to return home” to establish the home as an exempt asset. We have our clients execute an “intent to return home” form when we prepare their asset protection estate plans.
  • IRAs, 401k’s and other “qualified accounts” are exempt. The applicant however must be taking RMD’s or some amount of principal and interest on a periodic basis.
  • Not more than $2,000 in cash in the applicant’s name, which could include savings and checking accounts.
  • One care is exempt. If a couple owns two cars, we request an exemption for the more expensive car.
  • Term life insurance is exempt, but whole life insurance cannot have more than $1500 cash value.
  • Burial plots are exempt, and prepaid irrevocable burial plans are exempt.
  • Qualified or work related annuities are generally exempt. Other annuities may be exempt according to the Medi-Cal regulations.
  • Household furnishings are exempt.

This list is not exhaustive, and this information is not to be taken as legal advice. You are encouraged to see your elder law and probate attorney. At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com, we practice Elder Law and we help Baby Boomers, Seniors and families through their Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, probate avoidance, wills, trusts, powers of attorney and probates. We also help Baby Boomers and families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit.

Michael J. Young

Walnut Creek Elder Law

Elder Law, Asset Protection,

Medi-Cal and Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

Feb
08
2018
0

Proposition 58 Property Tax Exclusion -Transfer Between Parent and Child

A property tax re-assessment of the home in a transfer from a parent to a child can be avoided under California Proposition 58. For instance, when a probate is closed and the home is transferred to a child, or if the home is transferred to a child through trust administration, we can complete the “Claim For Reassessment Exclusion For Transfer Between Parent To Child.” If accepted by the assessor, the child who receives title to the real property through probate or the trust, can retain the parents’ old tax basis. Under Proposition 58, a son, daughter, child adopted before the age of 18, son-in-law, daughter–in-law and step-child, can be identified as the child. This re-assessment exclusion can be very valuable. For instance, the parents may have purchased their home some years ago for $85,000, and then leave their home to their daughter through probate or trust administration. When the parents die, their home could be worth $1,000,000. By utilizing Proposition 58, after the close of probate or trust administration, the daughter should be able to continue to pay property tax on the parents’ original tax basis of $85,000.

This information is not to be taken as legal advice, and you are encouraged to see your Walnut Creek Probate Attorney, Michael J. Young.

Michael J. Young, Attorney at Law

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Feb
07
2018
0

Letters Testamentary and Letters Administration in California Probate

When the Personal Representative of the Probate Estate is appointed, whether that person is identified by the court as the executor or administrator of the estate, “Letters Testamentary” or “Letters Administration” will be issued to that person by the court. The Letters give the personal representative authority to carry out certain business of the probate proceeding.  This authority is often given under the California Independent Administration of Estates Act, with full authority or limited authority. Full authority allows the personal representative of the estate to sell or exchange real property without court supervision. Limited authority to sell real property requires court supervision. All estates however, do not require letters or a full probate proceeding. Generally speaking, a probate is only required when the decedent had assets over $150,000 in value. Estates that have no real property, and have a total value under $150,000 can often be administered through a small estate affidavit under Probate Code § 13101.

This information is not to be taken as legal advice, and you are encouraged to see your Walnut Creek Probate Attorney, Michael J. Young.

Michael J. Young

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Feb
07
2018
0

The Personal Representative of the Probate Estate

When a probate is filed, the court will appoint a Personal Representative of the estate. This personal representative will be identified in the court proceeding as the executor or administrator of the estate. This person will sign and file the various documents that will be required by the court through the course of the probate proceeding. If there is a will naming an executor, the court will most likely name that individual as the executor of the estate. If there is no will, then the surviving spouse, the children of the decedent, parents, etc., can petition the court to be named as the “Administrator With Will Annexed.” The term “administrator” is also used when a person dies without leaving a will which would name an executor. If the executor named in the will has died or cannot serve for some reason, the court will appoint an administrator. If a former spouse is named in the decedent’s will as the executor, and there has since been a divorce, Probate Code § 6122 prevents the former spouse from serving as executor.

This information is not to be taken as legal advice, and you are encouraged to see Michael J. Yung, your Walnut Creek Probate Attorney.

Michael J. Young

Walnut Creek Elder Law Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Feb
07
2018
0

The Probate Spousal Property Petition

Assets that pass to a surviving spouse can be confirmed to the surviving spouse, through a petition process in probate court. This is not a full probate, and is called a “Spousal Property Petition”. This petition process usually takes around two months to complete, as opposed to around a year that is needed to complete a full probate. California Probate Code § 13500 provides for this petition process. The petition can be filed by a surviving spouse or surviving domestic partner. If a will exists, and the only beneficiary named in the will is the surviving spouse, then the property will pass to the surviving spouse. If the will lists other beneficiaries in addition to the surviving spouse, then only the property listed in the will that goes to the surviving spouse is subject to the petition. If there is no will, the community property can also be passed to the surviving spouse through the “Spousal Property Petition.” For the spousal property petition, the probate court will require that the probate form “1-DE-221, Spousal Property Petition”, be completed and signed by the surviving spouse. The petition will need to be supplemented with an explanation as to why the subject property should pass to the surviving spouse.

This information is not to be taken as legal advice, and you are encouraged to see your Walnut Creek Probate Attorney.

Michael J. Young

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

Feb
07
2018
0

Assets That Are Not Subject To Probate

Not all assets are subject to probate. For instance, life insurance policies that name a specific beneficiary are not subject to probate. If however, you name “my estate” or “my children” as beneficiaries, a probate will probably be required. Retirement accounts, also known as “qualified accounts” like IRA’s and 401K’s, are not subject to probate if they name a specific beneficiary. Title to real property that is held in a revocable living trust is not subject to probate, because the real property will be distributed to the beneficiaries of the trust, by operation of the terms of the trust. Title to real property that is held in joint tenancy or community property with right of survivorship will not require probate. However, if you die with your name alone on the deed, and the property is not in your revocable living trust, a probate will be required.

This information is not to be taken as legal advice, and you are encouraged to see your Walnut Creek Probate Attorney.

Michael J. Young

Walnut Creek, CA Probate Attorney

1931 San Miguel Dr. Ste., 220

Walnut Creek, CA 94596

925-256-0298

www.WalnutCreekElderLaw.com

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