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Preparing your tax return is a good opportunity to look at your personal “Income Statement,” compare it with those of previous years and your plans for the years to come. This could help you keep track of your income and expenses, obtain available discounts, and make sure that you qualify for Medicaid home health or nursing home Medicaid if you need it.

Here is an easy checklist to get you started.

  1. What is your current income? Where does it come from? How is it different from last year and the year before? Remember that a big increase in one year could lead to a higher Medicaid premium in two years unless you can show that it was an unexpected event not likely to reoccur.
  2. Is your income enough without taking more than the Required Minimum Distributions from your IRA and 401k? If not, how can you change that? Remember that inflation eats away at Social Security more than it does other income because Social Security benefits are calculated differently. Not drawing a lot from other sources of income now means you will have more when you need it later.
  3. Have you paid off your mortgage? If so, are you escrowing funds for property taxes? If you have not paid off your mortgage, what are your plans if you can no longer live at home?
  4. Do you have a reverse mortgage? If you are considering one, have you discussed this with your elder lawyer and financial advisor? There can be a lot of hidden fees.
  5. Are you getting the full “senior discount” on your property taxes? Are they up-to-date? If not, do you need to apply to defer them until you pass?
  6. Are you getting all applicable discounts on your homeowner’s and auto insurance?
  7. Are you “helping out” a friend or family member? To what extent? Why? If you have loaned them money, do you have something in writing?
  8. If a child has moved back in, do you have a rental agreement?
  9. If someone has moved in to help you out, do you have a caregiver agreement? Remember that if you someday need Medicaid home health or nursing home Medicaid, gifts (or what are seen as gifts) totaling $200 or more in a month could disqualify you for a time.
  10. If you received an inheritance, did you “share” it? Do you have something in writing to show this? Remember that anyone can give anyone else up to $16,000/year without federal gift tax being incurred. To give up to five times that, file a Form 709 with your income tax return, stating that this was a gift for a period of five years (or less, depending on the amount.)
  11. Do you have an auto loan? When will it be paid off?
  12. How many credit cards do you have? Do you pay them off every month? What do you use them for?


Download a copy to print: Annual Financial Checkup Checklist


Elder law attorney, Terry Garrett, is a member of the National Academy of Elder Law Attorneys and is an Approved Guardianship Attorney. She assists people in elder law, estate and special needs planning, guardianship and settling estates. She graduated with honors from Cornell University. She was on the Dean’s List at Wharton Business School. She earned her J.D. at Columbia Law School, receiving the Parker Award and a Mellon Fellowship.


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