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Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review August 7, 2006 / 13 Menachem-Av, 5766

Moving out, but keeping your home

By Jan L. Warner & Jan Collins


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http://www.JewishWorldReview.com | Q: Since my wife died two years ago, I have been lonely and not very happy continuing to live in the home we shared for 55 years. Too many memories, I guess. Because of my pension and good investments, I have an income of nearly $50,000 per year — enough, I think, to allow me to live comfortably in an independent living community and pay my way should I become unable to care for myself.


Which brings me to my question: I am considering giving my home (worth $150,000) to my only son so he can take care of the property, pay the upkeep, keep it from going through probate and avoid any estate taxes. I talked to my financial planner, and he thought it was a good idea because, he says, I don't need the money. Are there good reasons not to give it away?


A: A growing number of seniors who write us have opted to take advantage of the "real estate bubble" by selling their homes (which they built or purchased for, say, $20,000 some 50 years ago and are now worth 15 times that) and taking advantage of the personal residence capital gains exclusion of $250,000 for unmarried individuals and $500,000 for those who are married.


But it is unusual for seniors to want to give away a $150,000 asset in these uncertain times without full discussion with a knowledgeable attorney and certified public accountant of all the risks such a transaction brings. While financial planners' advice may be valid, we believe it would be a mistake to rely on this alone for a number of reasons:


1) If you transfer you home to your son, you lose not only control over the use and possession of your property, but also the proceeds if it is sold and rental income if it is rented. In addition, your son could mortgage it or, if he is in debt or owes back taxes, your house could become fodder for his creditors, the IRS and even bankruptcy. If you don't like the living accommodations where you will be living, giving away your house will also reduce your options substantially.


2) By making this transfer, you will lose all rights to benefit from property tax relief that is available for seniors over age 65 or those who are disabled. At the same time, if your son chooses to sell your home, he will incur capital gains taxes calculated on the difference between your cost basis in the house and the amount he receives from the sale. Depending on where you live, state and federal capital gains taxes will generally amount to 20 percent of the gain. The state checks to see if transfers of any property (including a home) have been made when you make a Medicaid application.


3) While $50,000 annually is a lot of money, with the escalating cost of health care and no guaranteed returns on your investments, you may find yourself digging into assets at a faster rate than you imagine. And should you run out of funds and have to apply for Medicaid within the next five years, the $150,000 penalty generated by the gratuitous transfer to your son will begin running when your Medicaid application is turned down.


In other words, should you run out of money and apply for Medicaid within five years from the date of the gift, your penalty will begin to run after Medicaid turns you down for services - meaning you will be required to pay for your care or you will be discharged.


Taking the NextStep: Unless there is a very good reason, we generally try to dissuade seniors from making gifts that will reduce their future care and quality of care. Unless you own more than $2 million, you will not have an estate tax problem. While the door is still open with regard to what that limit may be in 2010, recent legislation passed by the House of Representatives establishes the unified credit effective exemption for gift and estate tax purposes (called the "basic exclusion amount") at $3.75 million for folks who die in 2010. The U.S. Senate will take up this legislation in the near future, so keep an eye out.

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

JAN L. WARNER received his A.B. and J.D. degrees from the University of South Carolina and earned a Master of Legal Letters (L.L.M.) in Taxation from the Emory University School of Law in Atlanta, Georgia. He is a frequent lecturer at legal education and public information programs throughout the United States. His articles have been published in national and state legal publications. Jan Collins began co-authoring Flying SoloŽ in 1989. She has more than 27 years of experience as a journalist, writer, and editor. To comment or ask a question, please click here.

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