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If I ever need to go to a nursing home and apply for Medicaid benefits, will the 529 accounts I have set up for my grandchildren be counted as part of my assets?
Check to see if your state still applies an assets test for Medicaid eligibility purposes, and whether the test will be eliminated or modified in 2014 as required by the Affordable Care Act. The states that currently still consider assets when testing for Medicaid eligibility will generally treat your 529 accounts as "countable" assets. Because 529 plans permit you to take the money back, those funds will be considered available to pay for your nursing home expenses and other medical expenses. If you are concerned about maximizing Medicaid eligibility you should discuss with your attorney your desire to use 529 plans. You may wish to make someone else the owner of your 529 accounts. If you establish the 529 accounts under your own name, and later transfer ownership of the account to someone else (or even use the account to pay for college expenses), your Medicaid eligibility may be restricted by the “look-back” rules which cover transfers up to 36 months or 60 months prior to application for Medicaid.
- How can I select the right 529 plan if I don’t know where my grandchildren will be attending college?
- What happens if I have money in a 529 account for a grandchild who later decides to not attend college?
- I would like to put some money towards my grandchildren’s college savings, but I’m worried about unplanned medical expenses or other financial needs I may have later on. Can I get my money back out of a 529 plan?
- Which investment option in the 529 plan should I choose for my grandchild?
- We have 16 grandchildren below college age. Should we set up a separate 529 account for each of them, or can we combine the savings into just one account?
- Instead of opening my own 529 accounts, can I just make contributions to the 529 accounts my children have already established for my grandchildren?
- How do Coverdell education savings accounts compare to 529 plans?
- If I ever need to go to a nursing home and apply for Medicaid benefits, will the 529 accounts I have set up for my grandchildren be counted as part of my assets?
- What happens to my 529 plan if I die or become incapacitated?
- Am I hurting my grandchild’s eligibility for financial aid by putting money into a 529 plan for him?
- My tax adviser is recommending 529 plans as an estate-planning vehicle. What is the advantage?
- I’ve been making direct gifts to my grandchild each year into a custodial account (UTMA) with the understanding that those funds are to be used for college. Is there anything wrong with this approach?
- My estate planner tells me I can reduce my estate by paying my grandchildren’s tuition and not even have to worry about the gift tax. So why should I use 529 plans?