Jerry Taylor covers four ways to protect assets from Medicaid recovery before long-term care: annual gifts up to $16,000, a life estate on your home, certain annuities, and irrevocable trusts. All require planning at least five years ahead.
If you want to prevent the government from getting your money or your home should you need long-term care, I've got 4 ways to help you do that. First way is to start giving money to your kids while you're still healthy. You can give up to $16,000 per year to as many people as you want without having to file a gift tax return. This needs to be done at least 5 years before you need the care. Second, create a life estate. With a life estate, you have the right to live in the home until you die, and then it passes to your remainderman. That's whoever you designate to get the home. And if you create that 5 years before you need the care, the home will be exempt from Medicaid recovery. 3, put your money into an annuity. Some states like Colorado do not count annuity payouts against you for Medicaid eligibility. Check to see whether your Medicaid rules and regulations allow that. And 4, an irrevocable trust. Put your home or your money into an irrevocable trust at least 5 years before you need the care and it will be exempt from Medicaid recovery. There's no point in letting Medicaid take your money when there are ways around it. Follow me and I'll keep you up to date on all these things.
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