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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7254
Experience:  15years with H & R Block. Divisional leader, Instructor
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A taxpayer, age 72, wants to gift her children & grand children

Resolved Question:

A taxpayer, age 72, wants to gift her children & grand children 14,000 each. Are these gifts
subject to any look-back periods & do they affect Medicare benefits?
Submitted: 9 months ago.
Category: Tax
Expert:  Robin D. replied 9 months ago.

Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.
The new rules, which took effect in February 2006, extend the "look back" period from three years to five. If an individual gives away money or property during the five-year look-back, it triggers a penalty period during which he or she is ineligible for government aid.

Robin D. :

The person can certainly give up to $14000 to each individual and have no tax or reporting for the gifts.

Robin D. :

They normally would look at the avergae cost of nursing home and the gifts mad ein that time frame.

Customer:

Will there be any effect on her Medicare benefits, in the event she has to report her assets to them?

Robin D. :

For medicare that is on the look back but not for taxation.

Customer:

Will there be any effect on her Medicare benefits in the event she has to report her assets to Medicare &/or enters an assisted living facility in the future?

Robin D. :

Yes, the gifts made during that time could reduce the amount of govt aid available.

Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7254
Experience: 15years with H & R Block. Divisional leader, Instructor
Robin D. and other Tax Specialists are ready to help you
Expert:  Robin D. replied 9 months ago.
So sorry, I saw where you posted after we were finished.
When a person gives away assets (money too) and applies for Medicaid, then Medicaid will impose a "period of ineligibility" as a result of the transfer. The general rule is that for every month of nursing home care the person gives away, she will be ineligible for Medicaid for one month.
"A month of nursing home care" varies among the states.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7254
Experience: 15years with H & R Block. Divisional leader, Instructor
Robin D. and other Tax Specialists are ready to help you

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