2053 Woodbridge Avenue - Edison, NJ 08817

Tuesday, December 16, 2008

NJ Laws Email News E289 - December 16, 2008

NJ Laws Email Newsletter E289

Kenneth Vercammen, Attorney at Law

December 16, 2008

In This Issue
_______________

1. Stadium Beer Vendor Liability Suit Settled For $23.5 Million.

2. Appellate Division Cannot Amend DWI Refusal Statement. State v. Spell 142NJ 514 (2008).

3. A Unique Holiday Gift Idea! Gift Certificates for Wills & Legal Services.

4. Spending Down Medicaid Planning By Thomas D. Begley, Jr., Esquire.

5. Holiday/ Christmas song links to lyrics.

6. Website: Christmas Carols instrumental - Listen to on your computer.

7. Needed: Outdoor Nativity Scene.

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1. Stadium Beer Vendor Liability Suit Settled For $23.5 Million.

The beer refreshment vendor at Giants Stadium agreed to pay $23.5 million to
settle the case of a girl paralyzed in a crash with a drunken football fan under
an 18-month-old secret agreement that an appeals court unsealed Wednesday at
the request of a public advocacy group. The court ruled that the settlement
paid by Aramark, Inc. to Antonia Verni couldn't remain confidential because
the girl's privacy was trumped by the presumption of open court records and
the public interest in her tragic case.

Source dailybriefing@njsba-njldailybriefing.com December 4, 2008


2. Appellate Division Cannot Amend DWI Refusal Statement. State v. Spell 142NJ 514 (2008).

The Court affirms defendant's conviction substantially for the reasons expressed
by the Appellate Division. The Court vacates that part of the Appellate Division's
holding that requires police officers to read the final, additional paragraph
of the standard statement whenever a defendant refuses to provide a breath sample
immediately upon request. The Legislature has vested in the Motor Vehicle Commission
the authority to determine the Standard Refusal Statement.


3. A Unique Holiday Gift Idea! Gift Certificates for Wills & Legal Services.

During the Holiday season, we often buy gifts for our family and friends. May
we suggest a holiday gift which truly shows how much you care?

Purchase a Will Gift Certificate for loved ones. Secure their interests and
make sure proper planning is done.

The Law Office of Kenneth Vercammen's Holiday special includes:

- A Will and consultation on Probate
- Brochures on Wills, Probate, Insurance
- A 3 year subscription to NJ Laws Email News
- All for only $300.00!

Call 732-572-0500 for the Gift Certificate.


4. Spending Down Medicaid Planning By Thomas D. Begley, Jr., Esquire.

The client who engages in Medicaid planning is usually a person of modest means
who has been diagnosed with an illness and therefore the option of long-term
care insurance is no longer available. A typical client may own a home and have
countable assets of between $100,000 and $400,000. Most clients' goals are as
follows:

1. To obtain the best quality of care for the institutionalized person
2. To maintain the standard of living of the community spouse, including providing
sufficient income and assets so that the community spouse can continue to reside
in the family home
3. Avoid Medicaid liens being placed on the home
4. Preserving a modest legacy for the children
5. Addressing tax issues, including:
  · Federal and state income taxes
  · Federal and state gift taxes
  · Federal estate tax
  · State estate tax
  · State inheritance tax

At the beginning of the initial client meeting, the attorney must begin the
process of managing client expectations.

There are many strategies available to obtain or accelerate Medicaid eligibility.
Significant factors include whether the client is married; whether the client
is in crisis; the nature and extent of the client's assets; and the size of
the IRAs of the respective spouses.

Spending Down

Most states limit a Medicaid recipient to approximately $2,000 of countable
resources. One way to achieve this limit is to "spend down" all but
the permissible amount of countable resources. What clients typically want to
avoid is spending all of their assets on nursing home care. There are several
ways a client might spend down his assets.


Pay Off Debts

Repayment of a debt is not considered a transfer, because the individual is
receiving fair market value, and transfers are penalized only if the transferor
does not receive fair market value. Typical debts clients might have include
mortgages, home equity loans, car loans, and credit card bills. In order for
the spend down to be accomplished, the check must actually be written and delivered.
An outstanding debt is simply a liability that does not reduce assets for Medicaid
eligibility purposes.


Payment for Services

Payment for services, including medical bills and legal fees, does not constitute
a transfer. The services performed by the attorney are the value the client
receives for the payment. Therefore, there is no uncompensated transfer of funds.


Prepayment of Real Estate Taxes

In situations where the home is occupied by a community spouse it makes sense
to prepay real estate taxes. Since the home is occupied by the community spouse
it is a non-countable resource. Expenditure of the funds for payment of the
real estate taxes constitutes valid spend down.


Buy Household Goods or Personal Effects

Personal effects and household goods are excluded to the extent that the total
equity value of such resources does not exceed $2,000. In practice, Medicaid
does not appear to enforce the $2,000 limit.


The personal effects actually should be used by the community spouse. An excellent
example of a violation of the "pig principle" is a recent New Jersey
case. In that case, a 92-year-old grandmother was penalized for transfer of
assets. The grandmother lived in a nursing home and purchased a computer that
was kept at her granddaughter's home. The court held that there was no evidence
that the Medicaid applicant received anything of value for her $1,478.61 expenditure.


Make Home Improvements

Making home improvements is a way to convert countable assets (i.e., cash and
securities) into a non-countable asset (i.e., a personal residence). A home
and lot used as a principal residence are excludable resources.


Purchase New Home

Occasionally, when one spouse enters a nursing home, the community spouse decides
that the current home is too big and decides to move to a smaller home or a
condominium. Since the home is a non-countable resource, if the home is sold
and the proceeds of sale from the original principal residence are reinvested
into a more expensive home, the additional funds spent on the new home are converted
from a countable asset to a non-countable asset. This strategy relies on the
principal residence exemption.


Purchase Life Estate from Children

The Deficit Reduction Act-2005 exempts from the transfer of assets penalties
the purchase of a life interest in another individual's home if the purchaser
resides in the home for a period of at least one year after the date of the
purchase. The Act is silent as to how the life estate is to be valued, but elsewhere
there are references to the publication of the Office of Chief Actuary of the
Social Security Administration.


In a New Jersey case, a parent purchased a life estate in a child's house for
$126,665.10. The decision noted that a life estate entitles the person to use
and occupy the home. There was no evidence that the daughter or her family vacated
the home. The daughter and her family had no legal right to remain in the home
absent payment of rent.


The CMS Guidance contains some troubling language: "Unless a state has
a provision for excluding the value of life estates in its approved State Medicaid
Plan, or the property in which the individual has purchased a life estate qualifies
as the individual's exempt home, the value of the life estate should be counted
as a resource in determining Medicaid eligibility."


The child would not receive a Section 121 exclusion from the sale of a principal
residence, because he did not sell his entire interest in the residence.


Prepaid Funeral

Most states do not count funds in an irrevocable funeral trust as countable
assets. Also, most states do not have a dollar limit on the amount that can
be expended for the funeral. The monies must be put in an irrevocable trust;
the trust must be for the benefit of the Medicaid applicant; and the trust must
be established by an individual who reasonably anticipates applying for or receiving
Medicaid benefits.


An alternative to an irrevocable funeral trust is an irrevocable assignment
of a life insurance policy in exchange for funeral services of the same or greater
value as the cash surrender value of the policy. Funeral directors require a
paid-up policy.

Irrevocable policies issued by companies, such as Choices or Forethought, are
also acceptable to Medicaid and to most funeral homes. One of the nice features
of these policies is that insurance companies having significant assets back
them and they can be used in most funeral homes.

Purchase of burial spaces for adult children and their spouses do not constitute
transfers for Medicaid penalty purposes. The burial space resource exemption
applies to burial spaces for the Medicaid Applicant and also any member of his
or her immediate family. Immediate family means an individual's minor or adult
children, including adopted children and stepchildren, an individual's brothers,
sisters, parents, adoptive parents, and the spouses of those individuals. Neither
dependency nor living in the same household will be a factor in determining
whether a person is an immediate family member.


Purchase New Car

Frequently, when one spouse enters a nursing home, the other spouse is driving
an old car with high mileage. A good strategy is to have the community spouse
purchase a new car as part of the spend down. Under current law the best time
to purchase the car would be after the institutionalized spouse enters a nursing
home. Under federal law, the first $4,500 of the value of a car is excluded
from the calculation of countable assets. However, if the car is used for medical
transportation or transportation in connection with employment, the entire value
of the car is non-countable. Many states simply permit one car to be non-countable
regardless of value or use.


Copyright 2008 by Begley & Bookbinder, P.C., an Elder & Disability
Law Firm with offices in Moorestown, Stone Harbor and Lawrenceville, New Jersey
and Oxford Valley, Pennsylvania and can be contacted at 800-533-7227. The firm
services southern and central New Jersey and eastern Pennsylvania. Tom Begley
Jr. is one of the speakers with Kenneth Vercammen at the NJ State Bar Association's
Annual Nuts & Bolts of Elder Law and co-author with Kenneth Vercammen, martin
Spigner and Kathleen Sheridan of the 400 plus page book on Elder Law.


The Firm provides services in connection with protecting assets from nursing
home costs, Medicaid applications, Estate Planning and Estate Administration,
Special Needs Planning and Guardianships. If you have a legal problem in one
of these areas of law, contact Begley & Bookbinder at 800-533-7227.

5. Holiday/ Christmas song links to lyrics.




Did you ever wonder what the actual words/ lyrics are to favorite songs and
carols? Here they are:


Christmas Song Lyrics (http://www.nevada.edu/~blake/Christmas.songs.html)


Christmas Carol Lyrics (http://www.nevada.edu/~blake/Christmas.carols.html)


6. Website: Christmas Carols instrumental- Listen to on your computer.


http://catholic.net/christmas_songs/template_channel.phtml?channel_id=17


This is a great site with Holiday cheer: http://holidays.blastcomm.com/


 


7. Needed: Outdoor Nativity Scene.


A nativity scene, also called a crib or crèche (meaning "crib"
or "manger" in French) generally refers to any depiction of the birth
or birthplace of Jesus. The local Knight of Columbus members are looking for
used outdoor nativity scenes no longer being used or displayed, to give them
a new home.


Christian Nativity scenes usually show Jesus in a manger, Joseph and Mary in
a barn (or cave) intended to accommodate farm animals. A donkey and an ox accompany
them; besides the necessity of animals for a manager, this is an allusion to
Isaiah: "the ox knoweth his owner, and the ass his master's crib; but Israel
doth not know, my people doth not consider" (Is. 1:3). The scene sometimes
includes the Magi or Three Wise Men, shepherds, angels and the Star of Bethlehem.
The traditional scenes that show the shepherds and Magi together are of course
not true to the Bible story, since the Magi arrived much later (Luke 2:7-16).
(http://en.wikipedia.org/wiki/Nativity_scene)


If you have an unused Nativity scene, call Ken Vercammen at 732-572-0500






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Editor's Note and Disclaimer:


All materials Copyright 2008. You may pass along the information on the NJ
Laws Newsletter and website, provided the name and address of the Law Office
is included.


KENNETH VERCAMMEN & ASSOCIATES, PC


ATTORNEY AT LAW


2053 Woodbridge Ave.


Edison, NJ 08817


(Phone) 732-572-0500


(Fax) 732-572-0030


website: www.njlaws.com
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