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My mothers only income is $800 per month in Social Security. She receives the following public benefits in the state of Pennsylvania...food stamps, subsidized section 8 housing, Medicaid, and Medicare Part-B premium free. I am afraid that this inheritance (about 70k) will actually make her financial situation worse than improve it if she loses her benefits. Can you make any sugggestions? She is 65.

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Elmo has a later thread that covers the same thing. He pretty much has gotten what info this forum can give him. He now needs to see a lawyer or the appropriate people to help solve his question. We really can no longer help.
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Elmo - imo annuities bad idea if medicaid involved for an individual.
A SPIA - single premium immediate annuity - work for community spouse situations only imo as the SPIA pays out income to the CS and for LTC NH Medicaid the CS income doesn’t count for the NH residents eligibility. That’s not at all your mom’s situation.

Your mom has Medicaid and also other low income benefits, so getting an annuity that pays her an income is going to always, always pose problems or questions for determining if she’s still “at need”. I’d be really concerned that if she has mental health issues that she either fails to spend her income so goes over in assets allowed, or her state changes the income levels like in 3 years and she’s over the limit or she goes on a rant & decides to call in the annnuity like in 4 years.
To me, she needs a Special Needs Trust with you as the Trustee perhaps with atty oversight so it can be monitored and controlled outside of her whims, Trust for her benefit but not under her control.

Just ask your Aunt if probate opened and what the PC # is.
Aunt said “no formal estate”, well that means just what??
There imo has there has to be a legal mechanism set up to transfer assets of the deceased unless all banking stuff was set up to go POD (pay on death) to an individual as per bank records OR she already moved everything into her ownership / her name in the 10 years she was his caretaker OR everything was in a Trust.

Right now you do not definitely know $ guaranteed.
CD and the extra 20k for your mom is just a promise from Auntie.
Your auntie knows your mom’s history, right? So tell her your trying to put the $ into a SnT and you need probate # for your mom’s attorney to reference. Probate is not secret, it’s open records in my experience except for children’s guardianship issues.

Yes it’s safe to assume that if there was a will, once it’s filed to probate court, it will get a PC#, the Executor as named in the Will gets Letters Testamentary to give her authority to deal with the estate and a Docket report gets done every time documents are filed and then what the disposition are of the documents. If he died in June, probate may not yet be opened. Could be but usually families wait 6 mos to open it to see what bills / debts look like, if anything is POD.

If atty is NAELA or CELA level that’s the gold standard. They will have this in their business cards and be registered with state bar for this credentials. If not, find another.
If their that then next question is are they experienced with setting up Medicaid & low income program compliant SNT. I’d suggest you stress that your mom is NOT the typical elderly 85 yr old NH resident, that she’s just 65 and has mental health issues. At 65 and $70k, she is likely to outlive the $ so planning super long term is pretty critical. It may be that she does an irrevocable SNT but nothing drawn from it by you for years. Atty may suggest that your mom / you instead spend the $ to get guardianship over mom and the use rest of $ for a SNT. $5-10k for legal sounds reasonable.

You cant DIY this; and you need to definitively find out what the terms of the will are or if it’s instead gifting by your Aunt to her sister. The “no formal estate” sounds totally sketch. If your young, like in your 30s, it could be that Auntie thinks of you as being too young to understand what an Estate is......... If your Aunt isn’t forthcoming in info to you, then Your atty can do this.
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I didn’t respond to this earlier because I wanted to talk to talk to my aunt first and get more details. At the beginning of all this I did not ask her detailed questions because I did not think I would need to get this involved. Here is the 411...

At one point in time my grandfather did handwrite a will however it was never notarized so it hold no legal ground. My aunt managed to have him put her as co-owner and beneficiary on all of his accounts. For this reason, at his time of death she became sole owner of all is assets. Legally everything that was his is now by default hers and if she chose to, she can hold on to all of it and thats that. He did not own any property so its just savings account and CD’s.

She has decided to do what she deems is fair and give my mother 70k. She says my grandfather “chose” to leave my mother 50k and she is adding another 20k because she thinks that is fair. She claims that one of the other 4 sisters got “her share” when she needed financial help while he was alive and that was about 70k.

That being said, nothing is going through probate and as I understand it, my aunt would simply be wiring money from what is now her bank account.

So I was thinking...since it is not a formal inheritance (just my aunt gifting money) couldn’t my aunt (with my mothers consent of course) simply wire the money to me and I immediately pay off my moms car loan and a $1200 dental bill she has and then instead of me sending her money every month she can use her $800/month social security now that she wouldn’t have a monthly car payment and dental bill and when she needs to buy something outside of her monthly expenses (airline ticket, emergencies, etc) I can simply buy it for her?

If I have to report that wire transfer as income and pay taxes on it I can just deduct that from the amount that is being wired.

What are your thoughts? Given the above details, is there any reason why I would not do it this way? Any other suggested strategy? Do I still need an elderly law attorney?
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Elmo - at the bottom of this page on AC is a section titled “Elder Care Resources” and under that is attorney’s. It’s a list by state. Whether they are NAELA or CELA level you have to google their website. I’d suggest you find like 3 that are in or nearby the county where the probate court is (not necessarily where you live). In a lot of areas, the atty filings are all done via an on-line portal for attys registered within that court or jurisdiction. If the NAELA or CELA you get also does probate or has an associate within their firm that does probate, they can access the docket to see what’s what. Probate is pretty much all open records except for minor guardianship issues, so the atty can go online to see where things stand.

did your Mom get from Executor or the probate attorney a w-9 & maybe an I-9? Imo as Executor now x3, id have to have this info sent out and submitted back in order to do a distribution and there would be some sort of orders or sign off by court approving distribution or transferring of title to occur. Probate real sequential correctly formatted paperwork driven imo, it’s not hey look 5k let’s write a check...

Realize, Any $ paid over $600 is reportable to IRS.
That 70k will be reportable one way or another. So it’s good you deal with this asap. I’d be concerned that all of a sudden someone realized it’s December and they are trying to push through stuff to get assets distributed by end of year as your state wants probate to actually close with a bow on it soon and they want to get estate tax filing done for 2018. Ive been Executor in TX and it’s a leave it open till forever if you want state to so I’ve never had, had, had to get it done yesterday breathing down my back.

out of curiosity, is it just your mom getting inheritance OR is she just one of many? If you know that, please tell the atty you speak with. If it’s a big estate, I’d bet there’s a CPA or tax law atty whose doing distributions & working with probate atty firm. So if so, it imo best to be an atty to atty type of conversation to get your mom’s distribution moved into 2019.
Good luck and let us know what all happens, really as we all do learn from each other.
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@igloo572 thank you for taking the time to respond to my question. Since this is all new to me some of the legal jargon is little over my head but I will provide some more information that perhaps could give a better picture of whats going on so you can point me in the right direction.

my mother is one of 4 and I am pretty sure that my grandfather had all 4 in his will although I am also pretty confident that my mother by far got the least even though she is the only one in poverty. My mother is not on speaking terms with her 3 sisters right now and I have been talking with her one sister who is the Executor and who my grandfather lived with for about the last decade.

My grandfather had a will but there was no formal estate created and my aunt told me the other day that the money being dispursed to my mother is in a CD that is about to mature mid December.

She also told me that my grandfather chose to leave my mother 50k and that my aunt is “adding another 20k of her own money”. I didn’t ask questions but my guess is that the 20k is my aunt’s way to feel like a hero and clean her hands of any guilt from her sister getting far less than anyone else. There is a high probability that she had allot to do with how my grandfather structured his will so that may have played a role as well in her adding the 20k to eliminate guilt. I am not blaming her 100%. My grandfather although he was not very close or affectionate with any of his daughters, he always disapproved of my mothers life choices and treated her as the red headed step child specially after she moved many states south years ago.

my mom did not get a w-9 or i-9 from anyone as of this moment. My aunt and I were actually trying to delay the discussion of disbursement of the funds for the last few months since my grandfather passed in June because we wanted to see if my mother would agree to see a psychiatrist and get diagnosed/assessed. She has always refused and I was hoping that she would do it now if she knew it would get her the inheritance quicker. Unfortunately that did not work. Mom is in full denial that she has any type of personality or mental disorder and will not see anyone. But I think I at least got her to quit smoking.

Is it safe to say that if there is a will, there is definietely a probate docket and it is visible to a probate attorney?

how would I word the question to my aunt to better understand if she is somehow working through probate law? I know she is working with an attorney and cpa but i don’t know any more details and I have not asked.

Btw I spoke with an attorney for elderly law in the area my mom lives and she said that renewing/preserving my moms benefits will have a flat fee cost of somewhere between 5k and 8k which will come directy from the inheritance which “helps for spending down”. Plus another $450 to do paperwork for me to become my mothers power of attorney.

Thoughts?
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Countrymouse, things don't work like that here. Benefits would not be conveniently suspended for a while, they get terminated. And when you run out of money and reapply the government wants an explanation of what you did with the funds you had.
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I don't know that they do here, either (I don't know that they don't!) - it's just it would save everyone such a lot of time = money, and in this computer age it can't be beyond the wit of public servant, surely..?
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Get a lawyer immediately to set up an appropriate trust so she can keep benefits and a trustee can pay for things as needed to make her life better. BTW, that is not a small inheritance.
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Can someone please comment on how much I will probably be spending on an elderly law attorney to assist me with this? Just a ballpark will do. I would like to have some idea before I start calling attorney offices.
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Do you know the Executor and can you call them? Like today.

I’m assuming the $ is coming from a distribution done via probate. The Executor should - if it’s an independent administration - have a great deal of discretion as to when & how exactly the distribution is to be done. Lots of states don’t put a “close by” date as to probate having to be wrapped up by. So the distribution can be delayed or it’s done in groups by some sort of priority.

To do a distribution, there should be paperwork sent out, like they need your SS #, W-9, etc done. Has your mom gotten documents like that yet? If so, you don’t have time to waste. Contact the Executor and ask for distribution to wait 60 days. And within this period of time, you & your mom’s meet with elder law atty to come up with a Medicaid compliant plan, like a SNT (special needs Trust) and update her legal. If really she’s only 65, she likely will outlive the SNT totally.

Timing super important, she needs to start her month ok for low income and end her month ok for low income. So like she gets the $ on the 3rd of the month and the trust ready for it so all set up and clears banking before EOM. An experienced NAELA or CELA level of atty will know how to make this happen so that everything is Medicaid compliant.

NOT Medicaid allowed but Medicaid compliant.

Imo annuities bad, bad idea, they will likely NOT be Medicaid compliant unless it’s a SPIA type of annuity for a community spouse and SPIAs are allowed specifically in your state. Annuities are insurance products sold with hefty commissions
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Thank you for the detailed feedback. Its very obvious that you know the subject well.

The executor is my aunt however I do know she is working with some sort of attorney on carrying out my grandfathers will. Not sure if there is a “close by” date however my aunt told me that the money is coming from a CD that expires in a few days and she would like to dispurse the money before the end of the month.

Any advice on how I should go about getting a NAELA or CELA level of attorney asap to assist us without paying through the nose?
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Speak to an elder law attorney first. Also some of this money should be used to prepay for her funeral expenses and headstone before Medicaid makes her spend it down
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I have researched the annuity route however I have to see how to structure it because even if the monthly income from the annuity is still below the threshold, if not done correctly she can still be disqualified from certain public benefits she recieves.
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JoAnn29 Dec 2018
Then you need to talk to a lawyer versed in Medicaid law.
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Yes, maybe the money can be put in an annuity and she can draw so much a month but keep under the level she needs for benefits.
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If it were me, I’d find an attorney and ask how you can handle this legally without affecting Mom's benefits. Medicaid knows all and sees all. People who think they can hide money and put one over on the Government are sadly mistaken. The attorney may suggest setting up a trust for Mom to pay her expenses, even including long-term care insurance, funeral pre-planning, etc. I’m no legal expert, but when the money is gone, you may need to reapply for her benefits. If you don’t already have e POA, it might be a good idea to get it now, if you aren’t on her financial accounts, you should go to her bank and have yourself added. This made things much easier for me when I took over my mom’s finances.
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A sensible social security department would be used to things like this happening, and would be willing to suspend your mother's benefits for the time during which her legacy could theoretically support her; rather than putting *everybody* through the whole miserable process again. It would certainly be worth giving your mother's office(s) a call and asking them what to do.

But reapplying is the worst case scenario. Your mother can't be worse off financially - what she loses in benefits, she has in cash in her little hand.
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70k put in a SPIA is $300 and change per month. She would still be below poverty level and forfeiting benefits. In summary she could definitely be worse off financially.
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