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Can an elder care trust protect a portion of these assets? Is there a formula? Most of their money is invested in IRA's and they were told that IRA money cannot be protected. If the money was invested in Non-qualified funds, they could protect some the assets. Is this true?

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Gwhile, if your uncle or aunt are vets contact the VA. They will provide some money to pay expenses. The only other choice is taking care of them at home as long as possible (I live with my mom so she can live in her own house as long as possible.)

JoanneHarvey, I completely disagree. I gladly pay my taxes and would pay more if my mother could be taken care of without everything she and my dad worked and sacrificed for their entire lives wouldn't go to a for profit nursing home. What happens when everything is gone? They get kicked out of their care home and go to a low quality center that has to get by on the tiny amount Medicare covers. There are even people that work on commission to help you place your parent. After talking to one of these "placement counselors" my sister and I decided to take care of Mom at home as long as possible. She goes to a daycare 3 days a week and we have someone help at home when I need a break. We are lucky my dad was a WW!! vet so the VA will help pay some for home care, assisted living, or long term nursing care. Our nation could afford to provide that for everyone! Feel free to tax me more if it will help take care of all of our elderly. Call it "affordable insurance" if the word "tax" is offensive. I certainly want what I have worked for to go to my kids and not a nursing home!
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gettingoldsucks, your sisters do need to be paid, caring for a an invalid is hard work. Some people like AZenHog have the wonderful luxury to be able to care for her mother without pay, and that's a wonderful thing. But most of us have to earn a living and if we can't work and we need to care for our parents instead, we need to be paid. They should pay their taxes and pay into Social Security, this protects them and they will need that Social Security when they get older.
You could talk to an accountant to figure out how to do that, but I would suggest following protocal because if your mom is ever audited you might be held responsible for all the money leaving her account without 1099's showing that it is going for her care.
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I think you are asking how to protect your elders funds from a nursing home. It seems only fair that your elder pay for his/her care. Many people do protect their money so that relatives can inherit it later but is that really fair? If that money, is not spent for the care that elder then it means that we as tax payers have to foot the bill. Like janfrancisco said there is a 5 year look back, if they are already in a nursing facility it's too late.
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Mary, that is definitely not how it worked in my state ten years ago. The amount allowed to be set aside for the spouse is determined by a formula. In our case it was $43,000. I was not able to work for 2 of the 10 years I cared for my husband at home, so as you can imagine we went through a lot of that while he was still alive. I am now a 68-year-old widow trying to figure out how to support myself for the next 20 to 30 years.

I say if gwilhe's lawyer can determine a legal way to protect assets for her aunt, more power to them all!
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There is a 5 year look back after everything is put into an irrevocable trust. Any adult child should understand that no one owes them an inheritence. I believe that its their money and they should use it for their own care, good care, private care, fabulously spoiled rotten care!! After all, they earned it all their life and shouldnt be put into a nursing home with 3 different nurses aides a day who have no quality time to spend with them. We used my Moms money all up for her needs over the past many years .We have my Mom with us in our home, she still gets a small SS check and we support her, shes priceless. I know in my heart, my Dad would never have wanted us to all get an inheritance and throw mom into a nursing home, she always came FIRST and whatever was left, if anything, would be inherited. If its gone, its gone, so what, let them go out in style with the best care available. Once the money is gone, then apply if you want to but for now, use it. I do not know about when a spouse is still alive but best of luck to that situation!
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I think Joanne's last response is right on and we should pay our fair share. Nursing homes in large part are private businesses that have those necessary bottom lines; they don't work for free. Medicare will help for short-term stays, but not long-term, permanent care. As discussed, if a spouse requires long-term nursing facility care there are Medicaid programs to help pay those costs while not taking everything from the other spouse still living in their home. If that sole spouse later requires nursing care Medicaid may put a lien, when that person has passed, on any owned property to recoup some, or when possible, all of its expenditures. But those are our tax dollars paying for such expenditures and any of us could find ourselves using that system, no matter how much we've planned and saved (unless we've bought a good long-term care insurance plan which isn't cheap). I don't mind my tax dollars or my assets helping someone out who has no other choices. A long term illness resulting in huge bills, unemployment, etc. all could wipe any of us out and we could need the help; that's the power of a social safety net and I'm glad we have such a safety net, albeit they're never perfect. I've talked to my kids about it and they totally understand there may be nothing to inherit at the end of the line and they're ok with that. I would add that if someone's loved one enters a nursing facility as a private pay patient, but will need Medicaid support later if their money runs out, get a written statement from the facility up front that when the patient is eligible, the facility will accept Medicaid (or Medi-Cal as it's called in CA.) as continuing, long-term care payment. This is an important issue to confirm as many facilities don't accept, or only like to allow a certain number of Medicaid beds at any time.
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gettingoldsucks, absolutely the hands-on caregivers should get paid. And they should treat the payments as income. Fair is fair. It is fair for them to get paid, and it is fair for them to pay taxes on it.

AZenHog is welcome to any arrangements that work for her (his?) family, but she is wrong that family can't get paid. To say, "I can't continue to do this without getting paid. Some other arrangements, such as a nursing home, will have to be made unless I get paid," is NOT extortion. It is simply stating a fact.
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gladimhere, the problem with deferring "payment" until getting an inheritance is two-fold. First, it is pretty hard to predict in advance how long the caregiving will go on, and it is hard to portion out how Daughter A's inheritance should be increased, as the full-time caregiver, and Son B's should be increased as the backup. A formula sounds good, but in practice it is very hard to set up and can result in very hard feelings. Why not just pay the caregivers and helpers as you go?

And the second problem is that very, very few people who have worked for a living and who need caregiving will have ANYTHING to leave for their heirs. It is just so expensive to care for those with chronic conditions. So that means the kids who did nothing to help get nothing -- but so do the ones who sacrificed for years to care for their parents get nothing.

When there are several children and all cannot contribute to caregiving equally, it seems to me the ONLY way to ensure fairness is the pay-as-you-go principle. If there happens to be anything left, all sibs can share it equally.
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and family members can be paid for caring for parents. There needs to be a care agreement in place before payment otherwise the money will be considered a gift which requires repayment before Medicaid will kick in. The caregiver must pay taxes and social security on the money as income. This also protects their future social security benefit.
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Jeanne, I agree completely with what you are saying, as I am in the situation of being an unpaid caregiver. I first asked to have siblings portion out a larger share of the inheritance, but they didn't feel right about making the change, which I also understand. So, the I requested to be paid. That again hit a brick wall and has ended up with attorneys, court hearings, etc. One sib actually said that mom saved for her retirement, with hopes of not having to spend it so there would be inheritance left. I was absolutely appalled at that statement. Well, if subs don't want to spend mom's money for her needs then they can split the cost of my service and pay me themselves. The issue is that the noncaregiving subs think we are on vacation and this is a walk in the park.'I would never agree to pay rent either, I would be in my own home if I were not needed and wanted here by my mom. After all that is what this is about, my moms happiness and comfort in her home.
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