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Ma has mid-stage Alzheimer's and has been living with us for over a year. Someone told me she could be my dependent, however I read somewhere that she would need to be on MY insurance. She has all her own insurance including dental and prescription and some state assistance. If I have her as my legal dependent, wouldn't she lose this? I am looking into becoming her conservator legally as I have already been doing this for the better of 20 years. I have been her POA and health care proxy for almost 10 years. Is there a way Ma could keep all of her own benefits and I could claim her as a dependent? I work full-time for now and have the family insurance through me. I am 57 and Ma might outlive my full-time status.

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We are going through some difficulties right now in our family because some of the family members do not agree with what the brother-in-law that was selected as the POA in our sister's (not his wife) Revocable Living Trust and Advanced Health Care Directive is doing. As POA of both he has all the decision making power an is not following the guidelines she set forth in the documents. But if he doesn't voluntarily adhere or step down from the POA position we have to file petitions and/or go to court. You need to check with your local county and states laws regarding these matters. Conservatorship and guardian are different but I believe is not necessary if you have the POA for the finances and person. Unless another family member is challenging you the POA should be sufficient for you to carry on paying bills and making healthcare decisions. But you might want to check with an attorney that specializes in these matters just to be sure. It is my understanding that you can claim anyone that you pay over 50% of their living expenses on your taxes as long as they do not file themselves or no one else is claiming them but again check with a tax specialist to be absolutely sure. It was my understanding that they had to residing with you for at least 50% of the year. But again it is best to check to avoid trouble with the IRS.
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Love that Pub 17.
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OK, you can claim a parent if you provide over 50% of their support even if they DON'T live with you. Please read what is considered a dependent relative in pub. 17 from the IRS, page 33, "relatives who do not have to live with you". Also, according to the IRS, support provided by the state is considered support for the receipent unless it can be shown that it was not used for that purpose. This means that when determining whether or not you are providing over 50% of her support, you must count the state assistance as income to her. See page 34 of the IRS pub. 17. I know because I work for H&R Block. I'm sure glad none of you are doing my tax return.
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Pam, don't be too sure about that. It's my understanding that you may claim a parent as a dependent (per pub 17) if they live with you and you provide over half of their support. This would include a share in the expenses of the house, food, utilitles, etc. Also their personal expenses such as clothing, personal care items. transportation to medical appointments, in-home help if you use it, etc. Often this all adds up to more than the public assistance provides. Call the IRS Help Line. They really are very helpful.
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Thank you N1, those are the IRS rules. Vermont ranks eighth in the country for the model benefit package: $28,338 in 1995, increased by dollar depreciation to $37,705 in 2013. This increase of $9,367 was the largest among the fifty states. Vermont’s current benefits carry a value equal to 193% of the Federal Poverty Level.
So in order to claim a dependent, you would have to provide over 50% support, so you claim you support her with more than $28,338 each year out of your pocket.
Oh, and you have to tell Welfare you provide that support on the application.
Tell me, what happens next?
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The accountants tell me that the only requirements for dependency are twofold:
1) That you provide over 50% of his/her support, and that 2) You they live with you at least six months consecutively out of the year ( Jan. 1- July 2). There is a limit on how much they can earn also. They cannot file their own tax return or claim themselves. You can list them as a dependent on your return. It's an extra $3900 for you.
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And if a tax return needs to be filed on the trust, that includes her, you cannot claim her as a dependent. She is a dependent of the trust. See an attorney that can help you line up what is best for your Mom.
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She cannot be your dependent and collect public assistance. One or the other but not both.
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First, as long as you pay over 50% of the support for your Mother, whether she lives with you or not, and whether she is on your insurance or not, she can be your dependent for tax purposes. Your Mother can keep her own insurance and still be your dependent. Being her legal guardian is different, guardianship means that you can make the day to day decisions for her care and this needs to be appointed by the court. Conservatorship gives you control of her assets and has to be appointed by the court. You do not need an attorney to obtain Guardianship &/or Conservatorship, but attorneys are valuable for this, since they know the ins & outs of the law. It is an expensive and time consuming process and your Mother may fight you on this with her own court appointed attorney. If she loses in court, you will have to pay for her attorney with her money. You will, also, have to file paperwork on a periodic basis with the Court. As you can see, dependency, Guardianship & Conservatorship mean different things and should not be used interchangebly.
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My wife has been doing both Guardian and Conservator and in addition is still the RR Pension Board Representative Payee for her mother. As a court appointed Guardian and Conservator there is paperwork to be done, which must be reported to the court on a specific schedule. As the Representative Payee she must also submit a report concerning a specific reporting period requested by the pension board. All are good methods for protecting the assets of the person you are responsible for. If you currently have Durable Power of Attorney (DPOA) and are not having difficulties with managing your mothers finances you do not need to have a court ordered guardian and conservatorship. If she currently has assets, insurance, etc then you should not have to pay for them, nor should you ever have to pay for them. However, to ensure that you are on track, and to minimize complications while paying bills, and acting in her behalf it is best to do a little research concerning your state and federal laws.
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My father has been living with me for over a year, I have a POA and MPOA, so am able to manage all financial and medical decisions. I have had no need for additional legal categorizations, and but could see the need for that if we determine he should be not be able to sign ANY documents, which technically he could still do today. By all means maintain the current insurance, including Medicare. One item you might look into is claiming as a dependent relative on your income taxes, depending on the amount of financial support that you are covering for his daily living/etc.
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With the POA and MPOA you are covered, and no don't let her insurance lapse. Since when did working adults have their parent on their insurance as a dependent? Never heard of this and I worked for Cigna, but stranger things are happening now. You have a cap on your insurance so keep them separate. Unless you want to spend the money to become her guardian, you don't need anything else unless you have unusual circumstances. That is great she has dental insurance. She will need it...Thank you for taking care of her and keep yourself healthy!
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Since she is irrational and barricading you out, I would say guardianship. Otherwise she still has rights; the law has no choice, will recognize those rights and her refusal to accept help as a competent adult. With guardianship she loses those rights to refuse and you can properly care for her in spite of herself. Conservatorship deals with finances only. Best to get an attorney.
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I put all of my mothers financial dealings into a revocable living trust in her name and I am the trustee of the trust therefore I pay all of her bills and manage all of the financial responsibilities. The trust though has it's own tax responsibilities and she is not my dependent. My mother does not live with me; she is in a memory care facility. Hope this helps in some small way.
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Why are you feeling as if POA is not enough? Does mom have assets? Is she paying rent or some sort of salary yo you for her care or management of her affairs?

You definitely need to see an elder law attorney. There are many options to compensate you in some way and a lawyer can discuss those with you. Guardianship/conservatorship are different things and since you have POA I do not know what sense it would make to spend the money to attain legal status.

Do you have siblings? Beware, if you start a legal process if siblings do not agree this will most likely become a very expensive proposition. If you are done it solely for tax reasons then there are other ways to claim Mom as a dependent. Again consult a elder law attorney, and before you do anything.
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because of court involvement, guardianship or conservatorship can be an expensive and time-consuming process...

Guardian vs. Conservator: What’s the Difference? Sep 8, 2010 - Robert J. Kulas, P.A.

When it comes to estate planning, the terms “guardian” and “conservator” tend to come up often. There’s sometimes confusion about what a guardian does as opposed to what a conservator does. The two roles are similar but distinct.

A guardian is a court-appointed fiduciary who is responsible for ensuring that the personal, day-to-day needs of a child or incapacitated adult are taken care of. The person whose well-being the guardian is responsible for is called a “ward”. In the case of a child, often the guardian is the primary caregiver, living with the child and fulfilling a parental role. This is not always the case with an incapacitated adult. The guardian of an incapacitated adult is usually in charge of making sure that the ward gets adequate medical treatment and that the ward’s caregivers are doing an adequate job of meeting his or her personal needs.

A conservator, or guardian of the property, on the other hand, is a court-appointed fiduciary who is responsible for managing the financial affairs of a child or an incapacitated adult. The conservator takes care of real estate, manages bank accounts, and handles investments. His or her duties can range from paying bills to buying and selling stocks and bonds to managing rental property on behalf of the ward.

The main benefit of having a guardian or conservator is that the fiduciary is subject to court oversight in fulfilling his or her duties.
{end quote}
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IMCO, beware of the huge paper-work and administration load.
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Personally, I opted for Guardianship. When my mother was at that stage and living alone, she wasn't paying bills, wasn't eating right and would barricade the doors to keep us out. We had no legal right to do anything for her. The advantage of having Gdn is that we were able to pay her bills (overdue) and make decisions for her day to day needs. You will need to go to court and it may take 6 months. I must report to the judge as to her care necessities and her money deposits/withdrawals. All monies/insurances/bills remain in her name as her possession it's just that her accounts have her name with my name as Gdn. All these accounts are totally separate from my accounts for both legal and accounting purposes. Hope this was some help
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