The Unknown (Half) Sibling – Part 2
In last week’s post I was telling you about Mary’s problem. She had moved in with and taken care of her cousin, Sam after his diagnosis of Alzheimer’s Disease. She had given up the lease on her apartment when she agreed to the arrangement and Sam promised in return to leave her his home when he died. After his death, however, she discovered that he had never executed a will stating this intention. Nevertheless, Mary had done some initial research and thought that she and her sister would inherit the home under New Jersey’s intestacy laws. She had called our office to confirm that this was in fact the case and to seek our help with the estate administration process. It was when I asked some follow questions that Mary told me about a family rumor that Sam’s father had a daughter from a previous marriage. If true, then this sibling would be the closest relative to Sam. Mary objected that this possible sibling was only a half sibling and did not even know Sam. I told her that didn’t matter. Half siblings are treated the same as full siblings and involvement in the decedent’s life did not factor in any determination under the intestacy laws. These laws are arbitrary in
The Unknown (Half) Sibling
I have written in this blog previously about the outcome of estate distribution when the decedent (person who died) did not execute a will. New Jersey intestacy laws predetermine what happens to your assets and it may not be what you want. Mary called because her cousin, Sam had recently died. Mary had given up her apartment rental to care for Sam in his home after his Alzheimer’s diagnosis. She told me that Sam had promised her that he would leave her his home after he died. Unfortunately, he never put that promise in writing in the form of a will. Instead, I told Mary that the intestacy laws would tell us who would inherit the home, which was in Sam’s name alone and any other probate assets he held. She told me that Sam did put Mary’s name on his bank accounts but only as agent under power of attorney. This account then, would also pass by way of the intestacy laws. I then asked Mary about Sam’s family. Sam never married and never had children. Both his parents had passed away and Sam and his brother, Stan were their only children. Stan, however, died at the age of 10 and so had no children of his own. Mary said she and
Recent Trends with Medicaid Applications – Part 2
In my post last week I told you why I think Medicaid applications have become more difficult to get approved. This week I will talk about the ways the State has made it more challenging. One way, which I have written about several times over the past few months is the QIT requirement. I won’t review that here but encourage you to read my post from 2 weeks ago. There are, however, other changes that have occurred recently. More documentation than ever is required to process a Medicaid application. Routinely now, many counties require that we produce 5 years of an applicant’s credit card statements so they can examine the charges. The State wants to determine whether any of the charges are for purchases made for someone other than the Medicaid applicant. Purchases for others would be subject to a Medicaid penalty, a period of time during which the applicant continues to be ineligible for benefits. The greater the penalty the longer the period of time before the State has to pay out benefits. In other instances the documents that were once enough to explain transactions are now no longer sufficient. For example, a copy of a check from an insurance company for a property damage claim against an applicant’s homeowner’s
Recent Trends with Medicaid Applications – Part 1
I have been saying for some time that Medicaid benefits are much more difficult to obtain now than at any time I can recall in the last 25 years I have been filing applications on behalf of clients. There are a number of reasons for this and a number of ways in which the State has made it more challenging. First the reasons. Demographics certainly have something to do with it. The population in this country continues to age. The average age of Americans continues to climb as people are living longer. That means more individuals needing long term care and consequently more potential Medicaid applications being filed. At the same time the funding for Medicaid, which like all government programs comes from tax revenue, has come under pressure. More applications means needing more money but since the pandemic trillions of dollars have been spent in stimulus checks and extending unemployment benefits. Even before the current crisis state and federal budgets have been running at a deficit. In New Jersey, our State public pension fund is underfunded after years in which the State reduced contributions to apply public monies elsewhere. It only stands to reason that this budget crunch could affect other programs like Medicaid. While I certainly have no inside knowledge
Another Word About QITs – Part 5
In my last post on this topic (4/4/21) I told you about a case involving a qualified income trust (QIT) that was not used correctly causing the denial of a Medicaid application which we had filed. I appealed and the judge reversed the denial excusing the technical mistakes made by the trustee. Instead of depositing the whole amount of Social Security into the trust, transferring back to the applicant the $50 personal needs allowance she was entitled to and sending the rest to the nursing home, the trustee subtracted the $50 before depositing the rest of the income into the QIT bank account. Additionally, in one instance the trustee mistakenly deposited the Social Security into her own bank account. She realized her mistake when she wrote a check to the nursing home from the QIT account and the check was returned for insufficient funds. She quickly corrected the mistake but only in the month after the check was received. As I explained in my previous post, a decision by an administrative law judge can be accepted, rejected or modified by the State. In our case that is exactly what the State did. The judge found that the mistakes made were excusable because of the current pandemic. The State
Estates Left Unattended – Part 3
This 3rd post of 3 is about estate administration which was begun but not finished by an executor who died. As I explained last week, I first had to petition the court to be appointed administrator. The estate consisted of a house and investment accounts. There were several issues that needed immediate attention. Because the real estate taxes had not been paid for more than a year, there was a tax lien on the property. The town had sold the lien to an investor at a tax sale. Investors buy the liens and then continue to pay the taxes. When the homeowner sells the home or otherwise pays the taxes, the lien holder must be paid back with interest. The bigger payoff for the lien holder, however, is the possibility of foreclosing on the property after a waiting period which is usually about two years. In this way, it is possible for an investor to pay a small fraction of the fair market value for the property which can result in a huge profit when the property is resold. My concern as administrator was that a $350,000 asset could be lost to the estate if the lien holder obtained title to the property. In that case, the estate would get nothing