What Is A Spousal Elective Share In Florida?
Under Florida law, a spouse is disallowed from completely disinheriting the other spouse upon their death unless there is a prenuptial or postnuptial agreement that allows for it. This is the elective share, which is a right of election that a surviving spouse can make for approximately 30 percent of all assets of the deceased spouse.
In the context of Medicaid planning, it’s typically advised that the spouse in the nursing home transfers his or her countable assets to the spouse who is not residing in the nursing home. It is important to note that the countable assets are the assets that are transferred, whereas the non-countable assets are generally not transferred. If the spouse who receives all the assets both disinherits and predeceases the spouse who is in the nursing home, then there could be an elected share problem. To protect against this situation, a spousal special needs trust can be created to provide the spouse in the nursing home with his or her elective share from the deceased spouse, without disrupting their Medicaid benefits.
It is highly recommended that the spouse who is living at home update their will to provide for the spouse in the nursing home and satisfy the elective share, particularly because arguments could be made that disinheriting the spouse would result in a transfer of assets and Medicaid ineligibility.
What Is Emergency Temporary Guardianship As It Relates To Medicaid Planning?
If someone is looking to be placed in a long-term nursing care facility that costs $8,000 to $10,000 per month, then they are a candidate for Medicaid planning and protection if he or she has any assets. If the person being placed a nursing home does not have the mental capacity to make decisions and execute documents, or sign a new durable power of attorney to select someone to do that for them, then that person will need a guardianship in order to protect his or her assets. Generally speaking, if an account has a person’s name on it, then only they can control that account (i.e. write checks, direct transfers, surrender or close accounts).
If there is no durable power of attorney, then an emergency guardianship proceeding would be necessary in order to appoint someone to have this authority. It would have to be done on an emergency basis because in the Medicaid context, each month that passes could result in a dissipation of assets. Depending on the estate, this could mean the dissipation of several thousand dollars per month.
The emergency temporary guardianship results in very high legal fees, as well as a time expense on the caregiver. For this reason, it is highly advisable to get an updated power of attorney, regardless of age or medical condition. A durable power of attorney that allows for Medicaid planning should be considered for anyone who is concerned about avoiding an emergency guardianship proceeding and the associated costs.
Can Non-Exempt Assets Under Medicaid Be Converted To Exempt Assets?
In Florida, non-exempt assets can be converted to exempt assets—even on the day before applying for Medicaid.
Will Compensation To Children For Documented Household And Care Services For An Elderly Parent Be Counted As A Legal Spend Down To Qualify For Medicaid?
Under Florida Medicaid law, there is a provision that allows for a lump sum prepayment of caregiver services as part of a legal spend-down plan. This is typically called a personal services contract. Under this contract, a child can be named as a caregiver to provide services and advocacy that nursing homes do not provide. This caregiver can be paid upfront in one lump sum by the nursing home resident, and then apply for Medicaid legally immediately thereafter.
One consequence of the personal service contract option is that the child receiving the payment must pay federal income taxes on the receipt of that money. This is because that child is providing a service to his or her parent in exchange for compensation. It is the duty of an elder law attorney, the client, and the caregiver to determine whether the personal services contract is the best way to protect assets. (thegamedial.com) In many cases, the taxes that the caregiver faces will be less than the full cost of the nursing home. This consideration is part of the evaluation process to determine whether the personal services contract is appropriate.
Lastly, as part of the creation of any personal services contract arrangement, the contract shall be honored. This means the caregiver should manage and account for the money he or she receives, as well as the time he or she expends according to that contract. The caregiver should meet the terms of that contract and perform the services on their end; failure to do so could be deemed as a fraud in the Medicaid system.
For more information on Elective Share Of Spouse In Florida, an initial consultation is your next best step. Get the information and legal answers you’re seeking by calling (904) 398-6100 today.
Call Us Today
(904) 398-6100
