The holiday season is upon us yet again. It is easy to get caught up in the festivities and forget that if you or a loved one are enrolled in a public benefits program or are planning to apply in the future, it is important to remember that even holiday gifting can impact eligibility.
Are you or your spouse receiving Medicaid benefits? Or will you need long-term care in the next five years? If so, a review of five years’ worth of all financial documents is conducted during the application process. They impose a penalty by delaying eligibility for benefits depending on the total value of gifts that were made. The County Caseworker processing the application looks for outgoing transfers, cash withdrawals and checks without a fair market exchange of goods or services and, depending on the state in which you reside, Caseworkers can request more information on these various transactions. This, unfortunately, includes holiday, birthday, and wedding gifts.
Are you or your spouse a Veteran? If you qualify for Veterans’ monthly pension benefits, the Veterans Administration conducts a financial review similar to Medicaid during the application process. Their application asks whether any gifts, or transfers for less than fair market value, took place in the past three years. This is a fairly recent addition to the Veterans pension application requirements, so while there is a three-year lookback, gifting prior to October 18, 2018 is not countable. In addition, if you are already eligible for the benefit, there are exceptions to the gifting rules as well. The Veterans Administration is assessing each application to verify that the applicant did not give away funds in order to attain financial eligibility for the program.
In reality, planning for long term care is already difficult enough without having to monitor your spending to comply with public benefits regulations. But if the difficulties of 2020 have taught us anything, we have learned that there are always new ways to enjoy your family and friends. Enjoy a walk outdoors, a holiday meal or a craft together; capture the holiday spirit without the additional stress of spending. While it is important to be mindful when writing those checks to family and friends, if you have any doubts, consult your Public Benefits Specialist at Rothkoff Law Group.