There has been a monumental change in New York for same sex couples. For the first time in New York, same sex couples will have the right to be treated as spouses under the Marriage Equality Act of 2011, effective July 24, 2011.  This means that same sex couples will have the option to marry under New York Law and hence be entitled to a whole host of rights as a married couple. These rights include the right to health insurance coverage, the right to file a NYS income tax return as a married couple, the right to favorable Medicaid treatment when one spouse requires long term care, the right to an inheritance when one spouse dies and the right to the marital deduction for New York State estate tax purposes.

It will be important for same sex partners to understand their rights and legal obligations under this new law.  In our free webinar this coming Tuesday, August 23, 2011, we will explore estate planning options for same sex couples. Join Us!

FREE WEBINAR: MARRIAGE EQUALITY ACT & ESTATE PLANNING

Tuesday August 23, 2011,  7:00 p.m. - 8:00 p.m. EST

Join Us to Learn How the Equality of Marriage Act

Grants Rights to Same Sex Couples in New York State

 LOCATION: Participate by Phone or Online!

To Register:

Contact: Susan Tame at 800-680-1717 

Register Online: www3.gotomeeting.com/register/910652398

It has become clear to me that my worst fears regarding the 2006 changes to the Medicaid transfer penalty rule have become true.  Expanding the lookback period to five years from three years has put an insurmountable burden on seniors with dementia and their families.

The Counties have been very aggressive in their documentation requirements for the five year period to the point that Medicaid eligible seniors are not qualifying for Medicaid.

At a recent fair hearing, I successfully argued that the gifts were made exclusively for purposes other than to qualify
for Medicaid, even though the applicant was in frail health at the time of the gifts.

Without this approval, I do not know how the nursing home would have been paid the $100,000 it was owed; the gifted money had been spent. This was a win-win situation for both the client and the nursing home.

As reported in Newsday on March 20, 2011, the Henley family continues to struggle financially as they provide loving care to Mike at home. 

Unfortunately, navigating through the broken long term health care system is an overwhelming burden placed on the family.   For today, the Henley's problem is that Mike is on both hospice and Medicaid home care for additional services necessary to properly take care of him at home.  But Medicaid only lets the family keep about $1,100 of Mike's income to pay for his care while the excess amount has to be spent down on for his care.  Mike’s wife, Karen not only takes care of Mike but works full time and she has two children to take care of.  This is a travesty but there are no hardship rules for Karen.

One step that can be taken is for Mike's excess income to be paid into the NYSARC Pooled Income Trust so that money can be used for Mike's living expenses instead of being spent down.  Unfortunately, you have to have the right Durable Power of Attorney to establish this special account with NYSARC.  Now, the Henley's are facing commencing a guardianship proceeding.  To compound the problem, there is a now an outstanding bill with the home care agency. Thank goodness for the Alzheimer's Association Long Island Chapter (Mary Ann Ragona, Executive Director) who have stepped in to help Mike and his family.

I was privileged to have Karen and her two children, Courtney and Brandon on my TV show, Family Comes First. To get to know the Henley Family more personally, you can go to:http://www.familycomesfirst.tv/families/2010-season

Several little-noticed provisions of the recently-enacted law that extended the Bush-era tax cuts fundamentally alter how the Medicaid and Supplemental Security Income (SSI) programs treat tax refunds and other tax credits, making it easier for people with special needs to maintain their benefits.

Under the new law, tax refunds are no longer considered countable income for Medicaid or SSI purposes. Furthermore, any money received through a tax refund will not be a countable resource for 12 months following receipt of the funds, and SSI and Medicaid recipients will be under no obligation to segregate the funds from their other resources (SSI recipients can only keep $2,000 of resources and still qualify for benefits). Because of the change in the law, an SSI beneficiary can now retain his tax refund, even if it puts him over the $2,000 resource limit, for up to one year from the date of receipt, which is welcome news for beneficiaries who usually have to count every penny in order to avoid a disruptive loss of benefits.

The new law also changes the treatment of several other important tax credits. Under previous rules, Making Work Pay, Earned Income, Advanced Earned Income, and Child Tax Credits were all excluded as countable income for Medicaid and SSI purposes, but if the income was retained, it had to be spent within nine months of receipt. Now, the 12-month rule applies to all of these tax credits and, furthermore, First-Time Homebuyer Tax Credits that were previously countable as income and as a resource are now exempt and subject to the same countability rules as the other tax credits.

In one more piece of good news, the law applies to any refunds or credits received after December 31, 2009, which means that, in limited cases, applicants who were initially denied SSI or Medicaid benefits due to receipt of a tax refund or credit may actually be retroactively eligible for benefits. The Centers of Medicare and Medicaid Services have also indicated that seniors and other people seeking Medicaid coverage for long-term care will not be subject to transfer-of-asset penalties if they give away their tax refunds or credits during the 12-month grace period.

You Move to Fast, Got to Make the Morning Last!

A wonderful tune by Simon and Garfunkle

Would you stop time if you could?

My Planning Tip of the Day is Take the Day off – Yes, especially after the hustle and bustle of the holiday season -- Employers Beware (only kidding) . . .

Begin the new year of 2011 by taking stock of your life!

We need to work on “living” instead of “living to work”.

Make your decisions and have life work for you.

Wishing you health and happiness in 2011!

PS I have to work on this as well, a never ending challenge.

I am pleased to announce that my show, Family Comes First: Medically Fragile Children, will premiere on Wednesday, December 15^th at 7:30 p.m. on Telecare – Cablevision Channel 29 /137 and FIOS TV Channel 296. This show will run throughout the week and will be available at www.familycomesfirst.tv within the next month.

Until the 1980s, medically fragile children were most often cared for in hospitals and then institutions. Deinstitutionalization, which started with Willowbrook, resulted in children being moved into community settings. In addition, advances in healthcare technology have enabled more children with special needs to leave hospitals.

More and more children are leaving hospitals which puts extreme pressure on these families to provide for their children who require more medical equipment and 24 hour specialized care. This all comes at a very high cost, emotionally, physically and financially.

I am pleased to announce that my show, Family Comes First: Passing the Family Business, premiers on November 24^th at 7:30 p.m. on Telecare – Cablevision Channel 29 /137 and FIOS TV Channel 296. This show will run throughout the week and will be available at www.familycomesfirst.tv within the next month.

The Family Business can be passed on to the next generation successfully. Our show takes a look into the lives of the LaSpina Family. John LaSpina is a second generation owner of Maple Lanes in Brooklyn and five other bowling alleys on Long Island and his children are now involved as the business passes to the third generation of LaSpinas.

Not only do we meet the LaSpina family, John and his son, Joseph; we also have the input of Anthony Caporrino of Grodsky, Caporrino & Kaufman PC (a certified public accountant) and Jane Myers of Jane M. Myers, PC (a business transactional attorney) who will share their insights on how to avoid the pitfalls and successfully pass the family business from one generation to the next.

Statistics show that only about one-third of all family businesses are successfully transferred to the next generation and only 12% are successfully transferred onto the third generation.

Many family business consultants say the primary reason for this low survival rate is the failure to develop and effectively plan for the transfer of ownership and management of the family business.

This is shocking when you think that this country has been built on the success of family businesses. More than 90% of all business enterprises in the United States are family business. They account for 78% of all the new jobs created in the U.S. So much effort goes into making a business successful but I am not sure how much effort is put into the transition of the business to the next generation?

There are many factors to consider when passing on the family business.

There are personal, financial and legal issues that all need to be dealt with.

For anyone who has a family business, you will be inspired by the success story of the LaSpina family.

Seniors want to live at home and independently and why not? In our experience, the most important and valuable asset is one’s home. So, how does one protect the home while also accessing Medicaid for long term care and a Reverse Mortgage for living expenses?

When meeting with seniors, one of the most valuable planning tools in our tool kit is the use of the Medicaid Asset Protection Trust.

Lenders have been unwilling to provide a reverse mortgage when the home is owned by this type of Trust, but we have just learned that at least one lender is willing to approve reverse mortgages even when the home is in this type of trust.

If the senior is uninsurable or can not afford the premiums of Long Term Care Insurance, then the only program available to pay for long term care is the Medicaid Program.

With the Medicaid Asset Protection Trust, seniors are able to place their home in the trust and still continue to receive all the benefits of ownership including the exclusive use of the home during their lifetime while accessing Medicaid. They have also taken a step to protect their home from estate recovery if they later need Medicaid nursing home care. Of course, the transfer will have to be greater than five years from the time Medicaid is applied for in order to be eligible for Medicaid nursing home care.

Now, if seniors need additional income to meet their living expenses, they will be able obtain a reverse mortgage and protect the home. It is very important to analyze if the reverse mortgage is the best choice for the senior before the senior takes this step.

For more information on these strategies, please contact Vincent J. Russo & Associates, P.C. at 1-800-680-1717.