The Sandwich Generation . . . Helping Your Aging Parents
by Carol Abaya, M.A.
for release January 21, 2000
Are you juggling doing errands for your aging parents, your children, yourself and working at the same time? Are you tired, stressed out and upset that your once vibrant parent is now frail and needy?
Do you feel alone? Rest assured you are not alone! The Sandwich Generation is dedicated to the 50 million Americans who may have elder/parent care concerns and/or responsibilities.
Elders Should Keep Assets In Their Name only
Question: My father, 78, has $200,000 in stocks and bonds and a house worth about $150,000. He is getting frailer, but has no serious illness. My brother is trying to get my father to transfer the house and stocks to himself in case my father has to go into a nursing home. I don't trust my brother. I need guidance.
Answer: My basic philosophy is that parents, regardless of age, should not transfer assets, their home, or cash to children! In this case, it is your father's assets and he should keep them in his name only.
Once a person transfers assets, they are "gone" and cannot be retrieved. Your father should not become dependent on your brother's "good will" for a place in which to live and financial support. Your father should control his own assets and income. If he has to go into a nursing home sometime in the future (he may never need one), use his money to get the best care possible in the best SNF you can find.
The only time a house might be transferred is if the elder is really ailing and the house has been the adult child's primary residence for a long period of time. In such cases, the elder should retain "life rights" and the child should be prohibited from mortgaging or selling as long as your father wants to live there.
There are also the emotional factors attached to home ownership. A home represents security. To take this away from an aging parent can be devastating. You need to reassure your father at this stage that he is "safe."
Other factors: if your brother dies first, all your father's assets will be included in your brother's estate and distributed accordingly to your brother's Will. Or if your brother gets into financial trouble, creditors can go after what was your father's assets. Your father could lose everything!
* * *
Question: My parents have given me Durable Power of Attorney and from time to time want me to make cash gifts of their money to my two brothers and myself. Is there a certain way I should handle this?
Answer: Yes. Even though the gifts may be less than the $10,000 a year per person allowed by law, after your parents die, the IRS can challenge the gifts and add the amount back into the.estate.
So, you should do at least the following:
? make sure "gifting" is specifically allowed in the POA document;
? keep detailed records of each gifting transaction, and
? have your parents write a note to the receiver, saying the money (state amount) is a gift. Make a copy of both the check and note and keep in your files.
If you're not careful, the IRS can say gifts were not gifts and add the amount back into the estate.
* * *
Do you have a question? Send it in. Although letters cannot be answered individually, appropriate letters will be answered in this column whenever possible. Letters may be edited. Send letters to Ms. Carol Abaya, c/o Name\Address of YOUR newspaper or e-mail her at SandwchGen@aol.com.
Carol Abaya is an international-award-winning journalist and creator of the unique magazine The Sandwich Generation: You & Your Aging Parents.
NOTES TO EDITORS: text = 440 words; other material = 160 words
We would appreciate it if you would include the "Globe Syndicate" bug at the end of the column.
©2000 by Globe Syndicate, all rights reserved.