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What happens if you need to apply for Medicaid and you know there are assets but you can’t locate them?  We were working with George to prepare his mother for Medicaid.  He was spending down her remaining assets when he discovered some papers that suggested she might own some stock he had previously been unaware of. “What should we do”, he asked.  “Mom cannot tell me whether she or my dad sold the stock or whether she still owns it.  And it looks like there should be physical stock certificates somewhere but I can’t find them and she doesn’t know where they are.” Today, when an investor purchases shares of stock, they are usually held in book entry form.  These are commonly known as non-certificate share.  The owner does not actually have a physical stock certificate.  If you own stock in a brokerage account, such as Charles Schwab or Merrill Lynch, the shares are typically book entry form.  Certificates are rarely issued anymore.  This is preferable because if there is no certificate to hold , then there is no chance that it can be misplaced or lost. However, in the early and mid 20th century, most investors held certificate shares.  In our office,

Two years ago I wrote about family or “filial” responsibility laws.  What does the law say about a child’s responsibility to pay for a parent’s care?  The population is continuing to age and the problem of long term care isn’t going away so what, if anything, has changed in the past 2 years? China, with 200 million citizens over the age of 60, based on sheer numbers has the most acute problem.  Recently, a new law was passed there requiring children to provide for their parents’ needs, both physical and emotional, under the threat of monetary fines and/or imprisonment.  It was reported that one child was charged under the new law for not visiting her mother and ordered to do so at least once every two months. It’s hard to believe that such a law would be enforceable from a legal or practical stand point, in this country, but other countries are trying it.  25% of Japan’s population is over the age of 65.  While Japanese culture has a strong tradition of caring for elderly family members the problem of caring for the aged is becoming more acute there as well.  Typically, the wife has cared for her husband’s parents but with

Last week we were discussing Sue’s call to our office.  Her brother, John, is 65 and disabled, living in senior housing.  He now needs aides to assist him and she told me his income is $1900.  But, then she told me about the trust that Mom had set up for him in her will. Sue provided me with a copy of Mom’s will that contained the trust language.  The income from the trust is to be provided to John for his health, support and maintenance but none of the principal can be distributed to him.  The trust also provided that only 80% of the income goes to John.  The other 20% goes to a grandson, Joe, the son of Sue’s other brother, Jim. I asked Sue if she knew why Mom set it up that way.  She didn’t, other than to tell me that John didn’t have a particularly close relationship with their mother.  She surmised that Mom wanted to do something for John because of his disability and inability to earn income but didn’t really give it too much thought – or at least she never told Sue her reasoning. Sue told me that John’s share of the trust income varies from

Sue called concerning her brother, John, who is 65 and disabled.  “He has cerebral palsy”, she told me,  “and he is wheelchair bound.  He lives in senior housing and needs aides to assist him.  Someone told me he is eligible for Medicaid because he has nothing other than his Social Security income of $1900 a month.”  It sounded like it could be a good fit. I explained to Sue that New Jersey has a Medicaid program that can cover the cost of home aides that could help John with activities such as getting dressed, bathing and going to the bathroom. Typically, this program will cover 40 to 50 hours per week. I then went over the financials again with her.  “Is there any other source of income besides Social Security or any asset besides John’s checking account into which the Social Security is deposited”, I asked.  That’s when Sue told me about the trust that her mom had set up for John in her will. Sue told me that John had been disabled his entire life and had never acquired any amount of money.  “John didn’t get along with the family”, she told me.  “Mom left him a little bit of money but

Last week we talking about Jennifer’s problem, which she didn’t realize was a problem until she spoke with us.  She had been hiding her assets in her mother’s name to keep them out of the reach of her husband, who she was thinking she might divorce.  I told her that if Mom needs Medicaid – a distinct possibility given her declining health and limited assets – it would be a real problem. Then I told her how Medicaid works.  “Your mom will have to spend down her assets to less than $2000 before she’ll qualify for Medicaid”, I explained.  “If assets are titled in her name, Medicaid assumes they are hers.  You have the burden of proving they aren’t hers but rather yours”, I told her.  “She’ll have to sell that real estate you put in Mom’s name, spend that money down and then when it’s gone (along with her own assets) you’ll qualify her for Medicaid.” “Ok, I understand.  Not a problem”, Jennifer replied.  “Maybe I’ll transfer them to my daughter, Jackie, if we need to get Medicaid.” But that’s a problem because if we are claiming the assets are not Jennifer’s mother’s, Medicaid will ask us to prove it by producing

Jennifer told me that her mom’s health had been deteriorating over the past few years and that she would probably need home care soon, with nursing home level care a definite possibility in a few years, if not earlier.  She then told me that her marriage was “on the rocks” and she was placing her own assets she had accumulated into her mom’s name in an effort to protect them from her husband in the case of divorce. I told her that this could be a real problem if Mom needs nursing home care.  Jennifer told me that her mom has about $300,000 in assets.  With New Jersey nursing home care costing an average of $125,000 per year, I could certainly see the possibility of running out of money.  Jennifer told me her mother did not have long term care insurance so the only other option is one of New Jersey’s Medicaid programs. I asked Jennifer how much money she had been putting into her mother’s name.  She couldn’t tell me exactly off the top of her head but she estimated it to be a few hundred thousand dollars.  She had bought some real estate and placed it in Mom’s name.  Jennifer