Although there are many things they can no longer take your house, or car for now.
They can still take your house if you end up in a nursing home, especially if you are on Medicare and even more so if you are on Medicaid.
The house I currently live in originally belonged to Debi's mother and father.
We were only down here about three months, and I was working on a small home a few blocks away for Debi and I to move into. When her father, the healthy one, suddenly upped and died, leaving her very sickly mom with no one to care for her.
In fact, after I learned her sister was blind, and knew of her mom's illness, we had already made plans to move back to Debi's home town. However, we expected to plan for this over a five year time span. Keeping my Creve Coeur house to move back to after her parents were gone. But things did not work out that way. 9/11 changed everything instantly.
OK, back to the current topic.
After Debi's dad died, it came time to remove his name from the deed and read his Will.
The Will stated the house is to remain in the family, in other words, the Will gave the house to Debi and her Sister after both were dead. Unfortunately, at the time of his, and later her death, there was a 46% inheritance tax.
Being in real estate for a lot of years taught me a lot of tricks.
Before I get into that. I should note that if Debi's mom had to go to a state run nursing home, they would have gotten the house and land if she could not afford to pay for her care, which she would not have been able to.
To sidestep the inheritance tax burden, at the time we removed her fathers name from the deed, then 30 days later we put Debi and her Sisters name on the deed. And once I explained to Debi's mom the ramifications of being on the deed, she agreed to have her name removed from the deed. This could not be done for 30 days after her daughters names were added.
Now, once her name was removed from the deed, there was a FIVE YEAR time period where the state could still take the house if she ended up in a state run nursing home. This was scary because we were now sinking a lot of money into the house for major repairs. I sold the house I bought for Debi and I so I would be in this house to take care of Debi's mom, while Debi went back to work. Her health was declining rapidly and we were concerned she wouldn't make it another five years. We made a pact to keep her at home, no matter how bad she got. And since I had experience in caring for the sick, being twice a widower and going though the worst possible scenarios. This became my job.
My little tabletop business was still doing well at that time, so I did have enough income to start the first of the renovations. I got one super huge overseas order, and I used that money to buy Debi's sisters share of her inheritance. They were looking at buying a house themselves, and this money would make their down payment, so they jumped at the chance. We removed her name from the deed on the front lot the house sits on. The first amount was exactly one-half of the total value of this property, and a second amount I paid later was for personal property we needed, but they already had, such as the old riding lawn mower, garden utensils, and her half of the furniture. I paid this to them when they needed to replace their whole house AC/Heat Pump. After which we removed her name from the second deed for the back lot. So as it stands right now, Debi's name is the only name on the deed.
After the five years passed, then I started major renovations. Debi's mom was still with us for around eight years after her husband died.
By adding and then removing names from the deed, the house was never sold, nor did it change hands, per se. Doing it this way kept the inheritance tax from ever coming due. But it will when it goes to her son. I can't do the same thing with him because of his financial debt, mostly from school loans he is/or was greatly in arrears on, having gone to law school. He did pass his Bar Exam on the first try and now has a good paying job, but he doesn't want us to lose the house if something happens to him until after he finally gets his debt paid off. Also, I think the inheritance tax was lifted in recent years, or at least reduced considerably. He lives in another city and does not want the house anyhow, so doesn't really care what we do with it. If I die, Debi will probably move in with him after he gets one of the houses he has been looking at and just sell this old house. Considering my medical condition, it's good my name was never on the deed. If I get too bad, I know she won't be able to take care of me. Even so, I do hope I croak at home!
Boo Ubuntu
Re: Boo Ubuntu
About 11 years ago the inheritance tax didn't kick in until the estate value was over six figures. I'm thinking $100K but it might have been even more than that. Either way it was not an issue when mom passed. She didn't own any real estate nor did she have any investments. The sum total of her personal possessions and bank account was under $10K. Mom did what I always say I'd like to do. She spent it all and then died. LOL
The bit with elder care is terrifying. Unless the government steps in and pledges full support until we croak, the burden of paying for healthcare will remain on the individual. The problem, as you know, is that the older you get the more healthcare you will require. Whatever assets you do have get used up very quickly.
The bit with elder care is terrifying. Unless the government steps in and pledges full support until we croak, the burden of paying for healthcare will remain on the individual. The problem, as you know, is that the older you get the more healthcare you will require. Whatever assets you do have get used up very quickly.
Re: Boo Ubuntu
Yeppers, I learned that the hard way, TWICE, and will probably be facing it again in the not to distant future.
Here in Tennessee they raised the inheritance tax deduction to 5 million a few years ago.
They had raised it to 2 million shortly after Debi's mom died. And reduced it to like 6% give or take.
But at the time of her mothers death, the inheritance tax was 46% of appraised value for the previous year.
I do believe there was a deduction for basis, which would not have applied in our case, because the basis was not only under a grand, but it was prior to 1956 or something like that.
But it was because of this tax that I did all I did to keep them from having to pay it.
Missouri did not have an inheritance tax, with a caveat.
If your will named someone who lived in a state with an inheritance tax, then they owed it to their state.
Where Tennessee really got folks is by the EGTRRA tax. I forget now what the initials stood for, but they had a Death Tax of like 6 to 9% of cash on hand, saving, checking, investments, etc. plus the 45% estate tax. Seems they also had a burial tax as well when we put her to rest. Because she was no longer on the deed, and because the 5 years had elapsed before she died, and most of her money was put into one of her daughters names, the only tax we had to pay for cash on hand was her most recent SS check. I paid the burial tax, which was a tad over 800 dollars. Now it is only 65 dollars, but I think this has something to do with the new 500 dollar exemption somehow.
Here in Tennessee they raised the inheritance tax deduction to 5 million a few years ago.
They had raised it to 2 million shortly after Debi's mom died. And reduced it to like 6% give or take.
But at the time of her mothers death, the inheritance tax was 46% of appraised value for the previous year.
I do believe there was a deduction for basis, which would not have applied in our case, because the basis was not only under a grand, but it was prior to 1956 or something like that.
But it was because of this tax that I did all I did to keep them from having to pay it.
Missouri did not have an inheritance tax, with a caveat.
If your will named someone who lived in a state with an inheritance tax, then they owed it to their state.
Where Tennessee really got folks is by the EGTRRA tax. I forget now what the initials stood for, but they had a Death Tax of like 6 to 9% of cash on hand, saving, checking, investments, etc. plus the 45% estate tax. Seems they also had a burial tax as well when we put her to rest. Because she was no longer on the deed, and because the 5 years had elapsed before she died, and most of her money was put into one of her daughters names, the only tax we had to pay for cash on hand was her most recent SS check. I paid the burial tax, which was a tad over 800 dollars. Now it is only 65 dollars, but I think this has something to do with the new 500 dollar exemption somehow.
Re: Boo Ubuntu
I've not put much planning into the aftermath of my demise. Making a will is still on my "to-do" list, for example. When it comes to planning my own finale, it gets morbid. It's not going to be too complicated in any event because I don't have much. The distribution of my possessions are already legally defined by inheritance laws, but I also realize I can do a few things to make it easier on my survivors. I never had to deal with much of that nor did my wife. About the most complicated thing would be the disposition of the real estate, and even that is just a matter of selling it and splitting the profits evenly.
At the moment I'm celebrating being alive for 75 years. It's a milestone of sorts but nothing big is on the agenda. I spent the morning sharpening knives and some time later in the day we will go out to eat. That's about it. Wife got me a lottery ticket and needless to say I am still not a multi-millionaire. Better luck next year.
At the moment I'm celebrating being alive for 75 years. It's a milestone of sorts but nothing big is on the agenda. I spent the morning sharpening knives and some time later in the day we will go out to eat. That's about it. Wife got me a lottery ticket and needless to say I am still not a multi-millionaire. Better luck next year.
Re: Boo Ubuntu
With what I had to go through when Barb died, I didn't want to have to do it again, so got as many things taken care of as I could before Ruth died. But even with all the planning, I still never had everything done, so had to come up with close to ten grand, which I wouldn't have had I started the process a couple of years earlier. No one thought she would go so fast.
In fact, the day she died, we were just sitting waiting for the doc to sign her release so she could go home. Although it was a surprise and unexpected when it happened, because of the timing. It was probable very soon!
One would expect her to be seriously going downhill, more than she already was. Not feeling well enough to be released from the hospital. But, if you knew the condition she was in, and all the work involved taking care of her, it really was a relief lifted from my shoulders. I was so deep in debt, that after her demise I went back to working ten hour days to get out of the hole, which I did accomplish, and it kept my mind off thinking about her so much, not that I ever forgot, I still think about her every day and see her in a lot of things. She is sorely missed.
In fact, the day she died, we were just sitting waiting for the doc to sign her release so she could go home. Although it was a surprise and unexpected when it happened, because of the timing. It was probable very soon!
One would expect her to be seriously going downhill, more than she already was. Not feeling well enough to be released from the hospital. But, if you knew the condition she was in, and all the work involved taking care of her, it really was a relief lifted from my shoulders. I was so deep in debt, that after her demise I went back to working ten hour days to get out of the hole, which I did accomplish, and it kept my mind off thinking about her so much, not that I ever forgot, I still think about her every day and see her in a lot of things. She is sorely missed.
Re: Boo Ubuntu
Mom was part of my life for 65 years, but I never got to know her as well as I did during her final years when I was her caregiver. A lot of personal effort is put into keeping a person comfortable and alive. When they ultimately leave this plane the break is too sharp to be absorbed quickly. They are still part of your daily life for a long time afterward. I'm certain you would agree that it is worth the effort. It's all done out of love after all. It's just overwhelmingly ironic that after putting so much effort into a single cause, the reward is to have that person removed from your life.
Re: Boo Ubuntu
Perfectly stated Yogi!
When you love someone, you will do anything for them, no matter how hard.
Sometimes it wasn't very pretty either. I'm sure you know what I mean by that, hi hi.
They do live on in our hearts and are thought about often!
When you love someone, you will do anything for them, no matter how hard.
Sometimes it wasn't very pretty either. I'm sure you know what I mean by that, hi hi.
They do live on in our hearts and are thought about often!