‘Tis the Season for Giving

apbThis is the time of year when I receive numerous calls from clients asking about year-end gifts they want to give to their children or other relatives and friends. Many have questions about the amount they can gift away without having to pay a gift tax.

You can give $14,000 per person per year (soon to be $15,000 in 2018) without paying a gift tax or needing to file a gift tax return.  However, our federal tax system gives each of us the right to give away, either during life or at death, up to $5,490,000 (increasing to $5,600,000 in 2018).  These amounts are indexed to inflation and increase over time.  If a gift to one person exceeds $14,000, a gift tax return is needed that year (to keep track of lifetime gifts) but no gift tax is paid until you reach the lifetime gift amount ($5,490,000).

So unless you think your taxable estate at death will exceed the federal estate and gift tax exemption amount ($5,490,000 for 2017; $5,600,000 for 2018), the $14,000 annual exclusion shouldn’t really concern you.  Remember, a gift (no matter how much) is not income to the person receiving it, and thus is not subject to income tax.  Additionally, there is no Massachusetts gift tax.  There is also no federal gift tax to pay unless your lifetime gifts exceed the exemption amount of $5,490,000 (for 2017).  So for practical purposes, unless you have a large estate, there is really no limit to the amount you can give to anyone at any time.

For Massachusetts estate tax planning purposes, there may even be a benefit to giving your kids some of the money they will ultimately inherit from you anyway.  For example, if you die with a Massachusetts taxable estate of $1,800,000, your estate will pay an estate tax of $85,200.  If you give away, say, $200,000 of that before your death, the remaining taxable estate of $1,600,000 Million will only be taxed $70,800.  So you actually save $14,400 in taxes.

There are some things you may not want to give away early.  For example, if the $200,000 you just gave your kids was in the form of low basis stock (i.e. stock you bought a long time ago for very little cost), then leaving it to your kids after you die would probably save them more in capital gain tax when they sell the stock than the amount your estate would save in estate tax, if you made the gift now.  So it’s always best to talk with your accountant or estate planning lawyer before you give away any portion of your estate.

Posted in Estate Planning, Gifting

Elder Law Seminars: Honoring Choices

During the next couple of months, my elder law seminars will be focusing on “Honoring Choices” in regards to your health care planning, should you become ill or in case of an emergency.  Below is a listing of my upcoming presentations throughout the community.


  • October 31: 1-2 pm
    Hudson Council on Aging, 29 Church Street.
    To register:   (978) 568-9638
  • November 7:  10-11 am
    Hopkinton Senior Center, 28 Mayhew Street.
    To register:  (508) 497-9730
  • November 9:  3–4 pm
    Saltmarsh Senior Center, 81 Washington Street
    To register:  (508) 228-4490
  • November 15:  1–2 pm
    Southborough Senior Center, 9 Cordaville Road
    To register:  (508) 229-4453
  • November 20:  1-2 pm
    Sudbury Senior Center, 40 Fairbank Road
    To register:  (978) 443-3055
  • November 21: 1:30 – 2:30 pm
    Marlborough Council on Aging, 40 New Street.
    To register:  (508) 485-6492
  • November 28:  5:30 – 6:30 pm
    Tisbury Council on Aging, 34 Pine Tree Road
    To register:  (508) 696-4205
  • December 6:  12 – 1 pm
    Ashland Department of Elder Services, 162 West Union Street
    To register:  (508) 881-0140


Contact your local Council on Aging for more information and to register.  If you miss a program, you may always watch them on your local cable access station or on my You Tube channel, Elder Law with Frank and Mary.

Posted in Assisted Living, Elder Law, Estate Planning, Home Care, Incapacity, Probate, Trusts, Wills

Leaving Your Wealth in Trust for the Protection of Your Children

Consider how your assets can benefit, or perhaps complicate, the lives of your children or other loved ones when you pass away. You know your children better than almost Umbrellaanyone else, and your estate plan should take into consideration their circumstances, tendencies, and personalities. They may be trustworthy, but may not be financially responsible. They may be financially responsible, but in debt, or may work in a high-risk profession. A divorce may be on the horizon. Whatever the case, it is important that the assets that you have carefully stewarded during your life are safeguarded for your loved ones when your wealth is transferred to them. A trust can accomplish these goals. Continue reading

Posted in Estate Planning, Trusts

MCLE Webinar on 7/18 to discuss the Daley and Nadeau decisions and their implications for irrevocable trusts and Medicaid planning

Lisa Neeley will be speaking about her role as lead counsel in the Nadeau case as well as offering her thoughts on the future of Medicaid planning in Massachusetts. Click here for more information and to register for the Webinar.
Posted in Elder Law, Estate Planning, MassHealth

The New York Times brings Medicaid home

Check out “You’re Probably Going to Need Medicaid” in The New York Times for an interesting read on the relevance of Medicaid.

Posted in Elder Law, MassHealth

SJC rules on Nadeau and Daley cases

Today the Massachusetts Supreme Judicial Court issued its decision in the cases of Nadeau v. Director of the Office of Medicaid Gavel (2) and Daley v. Secretary of the Executive Office of Health and Human Services. In the unanimous decision, the SJC held that the ability of an applicant for benefits to reside in property that has been transferred into an irrevocable trust does not render the corpus of the trust a countable resource in a MassHealth long-term care benefit application:

“We conclude that neither the grant in an irrevocable trust of a right of use and occupancy in a primary residence to an applicant nor the retention by an applicant of a life estate in his or her primary residence makes the equity in the home owned by the trust a countable asset for the purpose of determining Medicaid eligibility for long-term care benefits.”

This decision also clarifies that Federal law is controlling in a state’s eligibility determination, an issue which had been challenged by MassHealth over the past several years. Attorney Lisa Neeley represented the Plaintiff, Mr. Lionel Nadeau, before the SJC.  For the full decision, click here.

Posted in Elder Law, Estate Planning, MassHealth

Lisa Neeley’s article published in National Academy of Elder Law Attorneys Spring 2017 NAELA Journal

Lisa_Neeley_06212016The NAELA Journal Spring 2017 issue includes Lisa Neeley’s article Limiting State Medicaid Agency Attempts to Expand the “Any Circumstances” Test: An Analysis of Massachusetts’ Multiyear Legal Battle Over the Use of Irrevocable Trusts in Long-Term Care Planning. The article explores the use of irrevocable trusts as a Medicaid long-term care planning tool, highlighting key Massachusetts cases to provide a thorough history of the litigation surrounding such planning and its current legal implications.

Posted in Elder Law, Estate Planning, MassHealth

Converting Medicaid to a block grant program will hurt seniors and the disabled

capitolRecently, there has been much discussion in the news about the possibility of Congress radically altering the Medicaid program by converting it into a block grant system. Such a change would convert Medicaid into a system in which each state would receive a finite amount of funds to administer its individual Medicaid program. These funds are referred to as “block grants.” Continue reading

Posted in Elder Law, MassHealth

Tracy Craig comments on estate planning documents for different states

Check out “Estate Planning for Snowbirds.”

Posted in Estate Planning

Lisa Neeley quoted in The Washington Post article on “medical divorce”

What do Medicaid cuts have to do with divorce? Read Lisa Neeley’s thoughts in Jordan Rosenfeld’s article “The GOP plan to roll back Medicaid might force more couples to get divorced” published today in The Washington Post.

Posted in Elder Law