Elder Law | While generosity goes a long way, it can sometimes hurt you in the long term if you might apply for Medicaid one day. It’s an important topic in elder law to understand what you can and can’t do, and how it could potentially hurt your chances for Medicaid eligibility.
While federal law allows you to gift up to $14,000 before having to pay a gift tax, Medicaid will still count that gift as a transfer of assets. This includes gifts to charities, graduations, weddings or other major gift-giving situations.
Under federal law, if you transfer assets within the five years, or 60 months, before applying for Medicaid, it can hurt your eligibility. This is also called a transfer penalty. It’s important to understand during the estate planning that any amount of transfer can be examined for legitimacy, and further potentially hurt your chances of qualifying. Even spending a large amount of cash at one time can cause the IRS to inquire ab