February 2022

Friday, February 11th, 2022
by William Erhart

In response to the Coronavirus pandemic, the federal government distributes direct payments, known as Stimulus checks to Americans. In order to ease the economic impact of the Coronavirus pandemic and jump-start the economy, these payments are being made.
The stimulus money should have arrived in the same way that Social Security payments or tax refunds are made, either direct-deposited into a bank account or mailed as a paper check. If the money has not arrived, or for guidance in general, consult the IRS website: https://www.irs.gov/coronavirus/economic-impact-payment-information-center#more. Other options are to call 800-919-9835 or 800-829-1040, or you can visit your local Taxpayer Assistance Center
Will Stimulus Money Impact Medicaid Eligibility?
Those who are receiving means-tied government assistance, like SSI, VA benefits, or Medicaid to pay for long-term care, need not worry that stimulus money will be counted against them for eligibility. As long as recipients spend the money within twelve months, the money will not push them over the maximum amount they are permitted before they are penalized. 
Recipients may use the money to buy new clothing, cell phones or televisions, toiletries, snacks, dental treatment, or improved quality of medical supplies. They may buy an irrevocable funeral trust to avoid future expense to family members. They may give the money away to family or charities. The money might pay for updating estate-planning documents or for consulting a geriatric care manager. (Some commentators believe that you could give the money away to family or charities. While this may be OK under federal law, it’s probably best not to take chances with how the states may interpret it. Spend the money, don’t donate it.)
What Not to Spend Stimulus Money on to Protect Eligibility?
Provided that the money is not spent on what could be called an asset or an investment – like, for example, rare coins or stocks or bonds – the money will not be counted against the asset limit for Medicaid eligibility. And, again, the money must be spent within twelve months. It must not be forgotten about or left unnoticed in a bank account.
It also must not be misappropriated by nursing homes or assisted-living facilities. If this has happened to you or your loved one, inform the facility manager that the money must be refunded to the resident. Cite the law that carves out the payment from being counted toward federally assisted programs like Medicaid: 26 USC § 6409. Or show them a handout downloadable from the Congressional Research Service.
If the facility does not refund the money, contact your state’s attorney general. Then lodge a complaint with the Federal Trade Commission.
Recipients of assistance, like anyone else, are free to spend their stimulus money. The money is theirs. It is tax-free. It is intended to be spent, and it should be spent, in any way the recipient would like (subject to the conditions above). 
This is one time when spending is unquestionably a good thing – for buyers and sellers.
For more information and further inquiries about your personal situation, please contact our office at 302.651.0113.
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Essential information: Delaware Today produces a new list of top lawyers every year. Attorneys to do not pay to be on the list, nor are advertisers guaranteed placement. Listings in bold indicate the top vote getter in the category. Two bolded items in a single category indicate a tie.

Medicaid Planning is one key option for paying for long-term care. And within Medicaid Planning, one tool (among others) we often use is the Medicaid Asset Protection Trust or the MAPT. Both Medicaid Planning in general, and the MAPT specifically, can be confusing to learn about. In this book we walk through the basics of both.
Take the first step in understanding Medicaid planning by downloading our Medicaid Planning and MAPT Guide, then contact us to get started on your Medicaid planning questions.
In this guide, we will help you understand Medicaid planning topics, including:
  • Timelines for Medicaid planning
  • Medicaid asset protection trust
  • Asset protection from future creditors
  • Exclusion of capital gain on sale of principal residence
  • Ability to design who will receive trust income
  • Ability to make trust assets noncountable for beneficiaries’ Medicaid or SSI

Monday, February 21st - Office is closed in observance of President's Day.