[WSBAPT] Medicaid vs. IRS

[Chris Moore]

I have a client who gave her residence to her children with a retained life
estate over 5 years ago.  Then, about 5 months prior to applying for
Medicaid assistance, she sold the life estate for cash to her children.  In
calculating the amount to pay for the life estate, we used the IRS tables
and all parties reported those amounts on their tax returns.  Now, having
applied for Medicaid, my client has been denied benefits because she did
not use the Medicaid life estate table.  This matter will be coming up for
a fair hearing in a month or so.



Has anyone dealt with the issue of being required to use the IRS tables to
calculate a life estate for tax purposes and been denied benefits for
failing to use the Medicaid tables?  The difference here is about $24,000.
Which takes precedence; the IRS or Medicaid?  If we forced to use the
Medicaid tables, do we need to amend the parties’ income tax returns or
file a gift tax return for the excess paid?



Sincerely,

*Chris J. Moore*
Christopher J. Moore, JD, CPA, AEP®, EPLS*
Creason, Moore, Dokken & Geidl, PLLC
Lawyers
1219 Idaho Street, POB 835
Lewiston, Idaho 83501-0835
Phone: 208-743-1516; Fax: 208-746-2231
Website: www.cmd-law.com

*Certified as an Estate Planning Law Specialist by the Estate Law
Specialist Board, Inc., the only estate planning certification entity
approved by both the American Bar Association and the Idaho State Bar
Association.
_______________________________________________
*-- Note -- *The information contained in this e-mail transmission is
confidential and may also be a legally privileged communication. This
information is intended for the exclusive and private use of the
addressee(s). If you are not the intended recipient, you are hereby
notified that any use, disclosure, dissemination, distribution (other than
to the addressee(s)), copying or taking any action because of this
information is strictly prohibited. If you have received this e-mail in
error, please notify the sender immediately. Thank you.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20150327/a16579c0/attachment.html>