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
Have questions? We’re here to help.
Filter by
-
What is a Personal Care Contract?
-
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 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 a Special Needs Trust (a.k.a. Supplemental Needs Trust)
A special needs trust is a legal instrument that is designed to provide for the care and financial support of a person with disabilities, while also protecting their eligibility for certain government benefits, such as Medicaid and Supplemental Security Income (SSI).
The purpose of a special needs trust is to allow a person with disabilities to receive financial assistance without disqualifying them from government benefits that are means-tested, which means they are based on the individual’s income and assets. By placing funds in a special needs trust, the beneficiary can receive support and care that supplements, rather than supplants or replaces, their government benefits.
A special needs trust can be created by an individual for their own benefit, or it can be established by a family member or guardian on behalf of the person with disabilities. There are several types of special needs trusts, including first-party trusts (funded with the beneficiary’s own assets), third-party trusts (funded with assets belonging to someone else), and pooled trusts (established and managed by a nonprofit organization).
Special needs trusts are subject to strict rules and guidelines, and it is recommended to consult with a qualified attorney who is knowledgeable in this area to ensure that the trust is properly established and managed to achieve the intended goals.
Click here to visit RELEP’s Special Needs Planning 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. -
What is a D4A Special Needs Trust?
A D4A special needs trust (also known as a first-party special needs trust) is a type of trust that is funded with the assets of a person with disabilities who is under the age of 65. The trust is established to provide for the beneficiary’s supplemental care and support while preserving their eligibility for government benefits such as Medicaid and Supplemental Security Income (SSI).
The D4A special needs trust is named after the provision in the federal law that authorizes its creation, which is found in section 1917(d)(4)(A) of the Social Security Act. This provision allows a person with disabilities to transfer their assets into a trust that is specifically designed to provide for their supplemental needs without disqualifying them from receiving government benefits.
The D4A special needs trust can be established by the beneficiary, beneficiary’s parent, grandparent, or legal guardian, or by a court. The trust must also meet certain requirements, such as being irrevocable, having a trustee who is independent of the beneficiary, and providing that any remaining assets will go to the state upon the beneficiary’s death. This last part is known as the Medicaid payback provision.
It is important to note that a D4A special needs trust is subject to certain rules and limitations, and it is recommended to consult with a qualified attorney or financial advisor who is knowledgeable in this area to ensure that the trust is properly established and managed to achieve the intended goals.
Click here to visit RELEP’s Special Needs Planning webpage. -
What is a Tenancy in Common?
A tenancy in common is a type of ownership arrangement in which two or more people own a specific piece of property, such as a house or a piece of land. Each owner has a separate, undivided interest in the property, and each owner’s interest can be freely transferred or inherited.
In a tenancy in common, each owner has a right to occupy the property and use it in proportion to their ownership interest. For example, if two people own a property as tenants in common, one might own 50% of the property and the other might own 50%. Each owner would have the right to use 50% of the property and would be responsible for paying 50% of the expenses associated with the property, such as property taxes and maintenance costs.
Unlike joint tenancy, where each owner has an equal interest in the property, in a tenancy in common, the owners can have different ownership interests. Additionally, when one owner dies, their interest in the property passes to their heirs or beneficiaries, rather than automatically passing to the surviving owners. -
What is an Heir?
In Maryland, an heir is a person who is entitled to receive property or assets from the estate of a deceased person when the deceased dies without a valid will. Maryland’s intestacy laws govern how the deceased person’s estate is distributed when there is no will, and they determine who is considered an heir and what share of the estate each heir is entitled to receive.
Under Maryland law, the deceased person’s surviving spouse and children are typically the first in line to inherit the estate when there is no will. If the deceased person has no surviving spouse or children, their parents, siblings, or more distant relatives may be considered heirs and may be entitled to a share of the estate.
It is important to note that the rules governing intestacy and inheritance can be complex, and they may vary depending on the specific circumstances of the deceased person’s estate. In addition, the existence of a will, trust, or other estate planning documents can also affect who is considered an heir and what share of the estate they are entitled to receive. It is recommended to consult with a qualified attorney to understand the laws and rules related to inheritance and estate planning in Maryland.
Click here to visit RELEP’s Estate Planning webpage.
