Liquidating assets before nursing home
When a person passes away, the process of complying with the terms of the will is known as probate.This legal process generally involves appointing an executor (typically named in the will) to manage the decedent’s estate.Also, it is necessary to prepare a power of attorney for the potential applicant. However, with respect to an application for Medicaid, it is necessary that the assets of the applicant be “accessible” in the event liquidation is necessary and the applicant is not competent as Medicaid approaches.In an ideal “bread and butter” situation, it is important to limit the factors to be considered in projecting the date of eligibility for Medicaid.You will either need to liquidate enough assets to cover the liabilities or liquidate specific assets based on the purpose.Determine the value of the assets you wish to liquidate.
Legal Zoom is not a law firm and can only provide self-help services at your specific direction.Such rationale would also apply to assets such as IRA’s with investments within the IRA.Of course, the liquidation of the IRA gives rise to income tax consequences.The following is the simplest form of the projection problem: Applicant (single individual) has bank accounts of ,000. Therefore, Medicaid eligibility is anticipated in eight months (,000 bank accounts divided by$ 5,000 “net” monthly cost)Of course, the above example is markedly simplified.Prior blogs have discussed issues that complicate the eligibility process such as payment of debts, liquidating resources, income tax liabilities, prepaid burial arrangements, life insurance, the handling of pension and social security payments and the recommended priority of payment of debts and expenditures.
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Review the probate code to determine if you need to have court approval prior to a sale.