[WSBAPT] Medicaid vs. IRS

[peggimoxley at aol.com]

I am pretty sure that the WAC specifies the life expectancy tables to be used.  Such tables have individuals living until they are about 115 years old and value the life estate tables much higher than the IRS tables which are always based on the latest census information.
 
Peggi Moxley
Wenatchee, WA 
 
 
-----Original Message-----
From: Chris Moore <chrism at cmd-law.com>
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Sent: Fri, Mar 27, 2015 10:04 am
Subject: [WSBAPT] Medicaid vs. IRS


 
  
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.
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