In this Elder Law Minute, Wes Coulson discusses how Medicaid treats farmland as an asset.
Transcript:
Hi! I’m Wes Coulson from Dent-Coulson Elder Law, proudly serving clients throughout the St. Louis metropolitan area and beyond. I’d like to welcome you to our Elder Law and Estate Planning Minute. We do these to help educate people, give them some little tips, and especially to let them know the questions they need to ask, things that they’ve maybe not thought of. Our thought on that is that we can help you best if you realize the things that you need help and that we can help you with. So I hope you enjoy. Thanks!
I want to talk to you today about how Medicaid treats farmland. Generally speaking, it’s not a good asset to have because farmland tends to have substantial value, and so, generally speaking, it’s not something that you can keep within the Medicaid asset limit. Worse yet, they not only treat it as an asset, but whatever income the farm produces is expected to be contributed toward the cost of nursing home care and that’s based on gross income. So if you have $20,000 worth of gross farm income, and $5,000 worth of net farm income, not sure how you’re supposed to pay those expenses, because you’re expected to contribute $20,000 toward the cost of nursing home care.
There is one exception that can be really helpful and that is, especially if there’s a community spouse, the farm is considered part of the residence if it’s continuous to the residents. What that means is if you can play connect the dots around everything and it includes the house, then it’s considered part of the residence, if it’s a separate parcel, it’s not. Big advice here is that farmers particularly have a need to do planning in advance. You can get the farm out of harm’s way, with our help, into a trust that will protect it from Medicaid, but also not mess up capital gains tax considerations. If you have farm property, you probably already have an idea of what those are, but you need to do that five years in advance of applying for it to be as effective as you want it to be.
So if you own farm property, and you’re 65 or older, you really need to come see us to get some planning done. Thanks!
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Dent-Coulson Elder Law is dedicated to providing families in the St. Louis area with their Elder Law needs. Our practice areas include Asset Preservation Planning, Veterans Benefits, Medicaid Eligibility, Alzheimer’s Planning, Special Needs Planning, Estate Planning and more. We understand the financial challenges you may face as you and your loved ones grow older. At Dent-Coulson Elder Law, our clients’ well-being is our number one priority. For immediate help, call (618) 632-7000 (IL) or (314) 567-9292 (MO), or Contact Us and we will get in touch as soon as possible.
