DRA Adds
Requirements for Annuities
The
Deficit Reduction Act of 2005 adds the following requirements for
annuities:
-The requirement to disclose, in an
application for long-term care services, information regarding any
interest an applicant or community spouse may have in an annuity.
-The requirement to name the State as
a remainder beneficiary in annuities in which the applicant or
spouse is the annuitant; and
-Provisions for the treatment of the
purchase of certain annuities as a transfer for less than fair
market value. The DRA's requirements are extremely
complicated. Click
here to view the annuity provisions of the DRA.
In general, the purchase of an
annuity is to be treated as a penalized disposal of an asset for
less than fair market value. However, Section 6012 of the DRA
creates several exceptions. Using these exceptions,
individuals and couples can continue to reduce excess resources and
qualify for Medicaid through the purchase of an annuity.
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For further information, please contact:
Pennsylvania Care Management
49 East Fourth Street
Williamsport, PA 17701
570-326-1890
webmail@paannuity.com
* Certified as an Elder Law Attorney by the National Elder Law Foundation.
