In Maryland, a buy-sell agreement is a legal contract between co-owners of a business or property that outlines the terms and conditions under which one owner may sell their share to the other owner(s).
Buy-sell agreements are often used to provide a framework for the transfer of ownership in the event of certain triggering events, such as the death, disability, retirement, or voluntary departure of one of the owners. The agreement can also include provisions for the sale of an owner’s share if they default on a loan or violate certain terms of the agreement.
The buy-sell agreement can specify the price at which the owner’s share will be sold, as well as the terms of payment and any other conditions that must be met before the sale can be completed. It can also address issues such as how the business will be valued, who will be responsible for managing the business, and how disputes will be resolved.
A buy-sell agreement can be an important tool for protecting the interests of all co-owners and ensuring that the business or property continues to operate smoothly in the event of unexpected events. It’s important to work with a qualified attorney to draft a buy-sell agreement that meets the specific needs of the co-owners and complies with Maryland law.
Frequently Asked Questions
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What is Maryland’s LTC Medicaid Asset Threshold?
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What is a Life Estate Deed Without Powers?
In Maryland, a life estate deed is a type of legal agreement that allows a person (known as the life tenant) to own and use a property during their lifetime, while also designating one or more other individuals (known as remaindermen) to receive ownership of the property upon the life tenant’s death.
Under a life estate deed, the life tenant retains the right to use and occupy the property for the rest of their life, but they cannot sell or transfer ownership of the property without the consent of the remaindermen. Once the life tenant passes away, the remaindermen automatically become the owners of the property, without the need for probate.
Life estate deeds can be used for various purposes, such as to transfer ownership of property to family members while also allowing the original owner to retain use of the property during their lifetime. They can also be used to avoid the costs and delays of probate, as ownership of the property passes directly to the remaindermen upon the life tenant’s death. These types of deeds may also be used in Medicaid planning and asset protection planning.
To create a life estate deed in Maryland, the property owner must execute and record a deed that designates themselves as the life tenant and one or more individuals or entities as the remaindermen. It’s important to note that once a life estate deed is created, it can be difficult to change or undo, so it’s important to consult with a qualified attorney before proceeding with this type of legal agreement. -
What is a Medicaid Asset Protection Trust?
A Medicaid Asset Protection Trust (MAPT) is a type of irrevocable trust that can help individuals protect their assets and qualify for Medicaid benefits to pay for long-term care costs.
To qualify for Medicaid benefits, a person must have limited income and assets. By placing assets into a MAPT, an individual can effectively remove those assets from their estate and potentially qualify for Medicaid benefits to pay for long-term care costs. The assets in the trust are managed by a trustee and can be used to pay for the individual’s care needs, while still protecting those assets from being depleted.
There are certain restrictions and requirements for setting up a MAPT, and the rules may vary by state. Generally, the trust must be set up and funded at least five years before the individual applies for Medicaid benefits, and the assets in the trust cannot be used for the individual’s personal benefit during that time. In addition, the individual must be willing to give up control of the assets placed in the trust, as the trustee will have discretion over how the assets are used.
While a MAPT can be an effective strategy for protecting assets and qualifying for Medicaid benefits, it is important to work with a qualified attorney to ensure that the trust is set up properly and complies with all applicable laws and regulations.
Click here to visit RELEP’s Elder Law and Medicaid webpage. -
What is a Personal Care Contract?
In Maryland, a personal care contract is a legal agreement between a future prospective Medicaid recipient and a caregiver, typically a family member, in which the caregiver agrees to provide certain services to the recipient in exchange for payment. The purpose of the personal care contract is to establish a formal arrangement for the caregiver to provide care services, and to document the compensation and responsibilities of the caregiver.
Under Medicaid rules, a personal care contract is an allowable expense if it is properly structured and the compensation paid to the caregiver is reasonable based on the local market rates for similar services. The contract must be in writing and include specific details about the services to be provided, the compensation to be paid, and the duration of the agreement.
A personal care contract can be an effective way to manage the cost of long-term care for Medicaid recipients who require assistance with activities of daily living, such as bathing, dressing, and grooming. However, it is important to follow the rules and guidelines established by Medicaid to ensure that the contract is recognized as a legitimate expense and does not result in a penalty or disqualification from Medicaid benefits.
It is recommended to consult with a qualified attorney or financial advisor to understand the specific requirements for personal care contracts under Maryland Medicaid rules.
Click here to visit RELEP’s Elder Law & Medicaid webpage. -
What is the Child Caregiver Exception for Maryland Medicaid?
In Maryland, the child caregiver exception is an exemption from Medicaid’s “transfer of asset” rules that allows a Medicaid applicant to transfer their home to their adult child who has provided care to the applicant for a certain period of time. The purpose of this exception is to allow elderly or disabled individuals to transfer their home to their child without incurring a Medicaid penalty, provided that the child has lived in the home and provided care to the parent for at least two years prior to the parent’s admission to a nursing home or other long-term care facility.
Under the child caregiver exception, the Medicaid applicant can transfer their home to their adult child as long as the child has provided care to the parent that has allowed the parent to remain at home and avoid placement in a nursing home. The transfer must also be made as an outright gift, without any expectation of repayment or compensation.
It is important to note that the child caregiver exception is subject to certain limitations and requirements, and it is recommended to consult with a qualified attorney or financial advisor to understand the specific rules and guidelines for this exemption under Maryland Medicaid.
Click here to visit RELEP’s Elder Law and Medicaid webpage. -
What is Elder Law?
Elder law refers to a specialized area of legal practice that focuses on issues that affect older adults and their families. It covers a range of legal topics, including estate planning, long-term care planning, guardianship, healthcare decision-making, and financial exploitation prevention.
Elder law attorneys typically work with older adults, their families, and caregivers to provide legal advice and representation on a variety of issues related to aging. They may help clients create wills and trusts, establish powers of attorney and advance directives for healthcare, navigate the complex healthcare system, and protect their assets from financial exploitation.
Elder law also encompasses a range of issues related to elder abuse and neglect. Elder law attorneys may represent older adults who have been victims of physical, emotional, or financial abuse or neglect, and they may help clients take legal action against perpetrators of elder abuse.
Overall, elder law is an important and growing field of legal practice that helps older adults and their families navigate the complex legal issues that can arise as they age.
Click to visit RELEP’s Elder Law and Medicaid webpage. -
What is Long-Term Care Medicaid?
Long-term care Medicaid is a joint federal and state program that provides medical and long-term care coverage for eligible low-income individuals who meet certain medical and financial criteria. The program is known as Medicaid in the United States, and it is administered by individual states.
Long-term care Medicaid is designed to help people who require long-term care services, such as nursing home care, home health care, and other types of care that are not covered by Medicare. Medicaid may also cover other types of medical services, such as doctor’s visits, hospital care, prescription drugs, and medical equipment.
To be eligible for long-term care Medicaid, an individual must meet certain income and asset requirements, as well as medical criteria that demonstrate a need for long-term care services. The exact eligibility requirements may vary by state, but in general, the program is intended for low-income individuals who require extensive long-term care services.
It is important to note that long-term care Medicaid is different from Medicare, which is a federal program that provides health insurance coverage for people who are 65 or older, or who have certain disabilities. While Medicare may cover some types of medical services, it does not typically cover long-term care services in the same way that Medicaid does.
Click here to visit RELEP’s Elder Law and Medicaid webpage. -
What is the Medicaid Look-Back Period?
In Maryland, the Medicaid lookback period is currently five years. This means that when an individual applies for Medicaid benefits to pay for long-term care, the state will review the individual’s financial records for the five-year period prior to the application date to determine if any assets were transferred or given away during that time.
If the state determines that the individual has transferred assets for less than fair market value during the lookback period, they may impose a penalty period during which the individual will be ineligible for Medicaid benefits. The length of the penalty period is based on the amount of the transfer and the average monthly cost of long-term care in the state.
It is important to note that the lookback period and rules regarding transfers of assets can vary by state, so it is important to consult with a qualified attorney who is familiar with Medicaid rules and regulations in Maryland to ensure that you are making informed decisions regarding your assets and Medicaid eligibility.
Click here to visit RELEP’s Elder Law and Medicaid webpage.
