Consider a Care Contract When Caring for Your Parents

August 14, 2013

Many adult children are living with and caring for their elderly parents. As a recent article explains, it would be beneficial for both parties to create a care contract for these services. Through a care contract, the parties can agree that the caregiver will assume responsibility for, and accept a specified payment from the loved one.

A care contract is especially important if the person receiving the care anticipates eventually requiring a nursing home stay. When a person applies for Medicaid coverage, representatives for Medicaid will consider all of the money that he or she has available to pay for his or her care. A person will not be provided with coverage unless he or she has depleted all of his or her financial resources. If that person has a care contract in place, all the money that he or she spent on care will count towards his or her “Medicaid spend down.”

Without a care contract in place, Medicaid representatives may consider the money given to the caregiver to be a “gift” or “transfer of assets.” If this happens, the money will be factored back into a person’s assets and he or she could be denied coverage.

It is also important to have a care contract from a caregiver’s perspective. Without a care contract, other heirs may think that the caregiver offered his or her services for free and may attempt to reduce the caregiver’s inheritance accordingly.


Practice Areas:



Schedule your free Exploratory phone call

Click here to see how we
can be of assistance.

Payment Portal
for Tax and Accounting invoice

This link offers a secure, quick way to complete your payment with Omni360 Advisors LLC.

Our Social Media

Connect with us on Social Media using the following buttons:

Visit our Podcasts

Listen in, Join the Conversation!

Recent Posts

Your Tax Return Is a Roadmap: What to Review Before Year-End

Your completed tax return can reveal planning opportunities before year-end. Review investment gains, business income, retirement contributions, and estimated tax payments with your tax and ...

<p>The post Your Tax Return Is a Roadmap: What to Review Before Year-End first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.</p>

Business Owners: Five Financial Conversations to Have Before December

Before year-end, business owners should review profit projections, cash reserves, major purchases, retirement plan funding, and personal financial goals with their advisory team. The start ...

<p>The post Business Owners: Five Financial Conversations to Have Before December first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.</p>

Before You Make a Year-End Financial Move, Ask How It Affects the Rest of Your Financial Picture

Before making year-end tax, investment, retirement, business, or charitable decisions, consider how each move affects your broader financial picture. Year-end financial planning often starts with ...

<p>The post Before You Make a Year-End Financial Move, Ask How It Affects the Rest of Your Financial Picture first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.</p>