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Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review Sept. 13, 2005 / 9 Elul, 5765

Bad advice may cause Medicaid rejection; can stock sale avoid paying capital gains taxes?

By Jan L. Warner & Jan Collins


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http://www.JewishWorldReview.com | Q: My wife and I are in the process of placing her mother in a nursing home after she lived with us for several years. We did not charge her for any of her expenses during the time she spent with us because all she has left are four $5,000 certificates of deposit (CDs), each in her name and also in the name of one of her four children. When the CDs would mature, she renewed them in the same way. She has been very protective of these funds and wanted to make sure they were passed on to her children because she had spent everything else that she and my father-in-law owned paying for his nursing home care. She had even sold their home and many of their belongings to qualify him for Medicaid.

We were told that there were no problems protecting these funds because she had made gifts to each child years ago, and, by rights, these accounts belong to the children, not her, and will not be counted if she goes into a nursing home. We were told to cash in each CD and let each child take the $5,000. Her only income is $850 per month in Social Security. Can her children cash in the accounts without jeopardizing her Medicaid?

A: You have received very bad advice. Simply creating joint bank accounts with children does not amount to completed gifts. Because the CDs were funded with your mother-in-law's money; because she maintained control over these assets by making the decisions to renew them; and because she retained the right to change the manner in which the accounts were titled, there were no completed gifts, and she owns the accounts during her lifetime. If your wife and her siblings cash in the CDs now, your mother-in-law will suffer disqualification from Medicaid for a period of time equal to the total amount of the gifts divided by the average private-pay nursing home rate in your state at the time the gifts are made.

Had she transferred ownership of the accounts to her four children and relinquished control before now, gifts would have been made at that time, and the disqualification period would have passed.

Whether any of the money earmarked for her children can be saved at this late date is a legal question that will depend on the laws of your state. Rather than rely on bad advice from folks who don't know what they are talking about, we suggest that you contact an elder law attorney in your area to help guide you in the right direction.

Q: My husband of 40 years was recently diagnosed with terminal cancer. He's been given no more than six months to live. Until then, he was not willing to discuss any type of planning with me, would not go to a lawyer, and did not even have a will.

While preparing our wills and powers of attorney, the lawyer asked about our assets. I told him about a stock portfolio that was given to me by my mother before she died 20-plus years ago. Mother had inherited the same stocks from her father. Over the years, they have grown more than 15 times in value. I have not wanted to sell the stock because of the capital gains taxes involved, but the lawyer told us that if I put my stocks in my husband's name, at his death, I would be able to sell them without paying capital gains taxes. My husband told me this was fine with him if it would help me later, but it seems too good to be true. Can this be done?

A: When your mother gifted you the stock, you took the portfolio with what is called a "carryover basis" — that is, your cost starting point in the stock (cost basis) was the same as your mother's, which, in turn, was the same value as it was when she inherited from her father. Therefore, if you sold the stock, you would subtract your cost basis from the sales price and pay capital gains taxes on the difference. Had your mother left the stock to you by her will, your cost starting point would have been the value on her date of death, and you would have received what is called a "stepped-up basis" that would have reduced the differential between the sales price and your cost.

Your lawyer has suggested that if you gift your stock to your husband and he dies before you and leaves you your stock by his will, you will get a stepped-up basis and not be required to pay capital gains taxes. This is correct, so long as your husband lives for at least one year from the date you transfer your stock to him. If he lives less than one year, you will not be able to take advantage of the step up in cost basis, and your cost basis will be the same as it was before you made the gift to him.

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

JAN L. WARNER received his A.B. and J.D. degrees from the University of South Carolina and earned a Master of Legal Letters (L.L.M.) in Taxation from the Emory University School of Law in Atlanta, Georgia. He is a frequent lecturer at legal education and public information programs throughout the United States. His articles have been published in national and state legal publications. Jan Collins began co-authoring Flying SoloŽ in 1989. She has more than 27 years of experience as a journalist, writer, and editor. To comment or ask a question, please click here.

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