Should I Give My Kids my House to Protect It From Medicaid?
You may be afraid of losing your home if you have to enter a nursing home and apply for Medicaid. This fear is well-founded,...
Read moreIn 2023, consumers across the United States lost a total of more than $10 billion to fraud, according to the Federal Trade Commission. More than a million of them were victims of identity theft, with reports of these and other types of scams up from the previous year.
With identity theft and taxpayer fraud on the rise, the Internal Revenue Service (IRS) is encouraging taxpayers to take extra caution when filing tax returns. One simple way to help safeguard your identity is to create an identity protection personal identification number (IP PIN) through the IRS. An IP PIN is a six-digit number that helps the IRS verify your identity when you are filing your tax return.
The IP PIN program was introduced to help combat the growing problem of tax-related identity theft. In these cases, fraudsters use stolen Social Security numbers (SSNs) and other personal information to file false tax returns and claim fraudulent refunds. Identity theft in tax filing has become a major issue for the IRS, causing financial losses and delays for victims who have to work with the agency to sort out the theft.
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The IP PIN program was initially implemented to help higher-risk groups of taxpayers, such as high-net-worth individuals and those who had previously reported identity theft to the IRS. However, as tax-related identity theft grew, the IRS expanded the program to allow all taxpayers to request an IP PIN voluntarily. This move empowers taxpayers to be proactive in protecting their tax filings.
Taxpayers who enroll in the program must use their IP PIN when filing their federal tax return, either electronically or on paper. The IP PIN helps verify the taxpayer’s identity, ensuring that only authorized individuals can submit a return with their SSN. If an individual’s IP PIN is missing or incorrect, the IRS will reject the filing, helping prevent unauthorized filings.
You can receive an IP PIN through the IRS website by verifying your identity using the “Get an IP PIN” online tool. Once enrolled, the IRS issues a new IP PIN each year to maintain the security of your information. You can always retrieve your IP PIN if you lose it; find instructions on how to do so via the IRS website.
Paying taxes is not only mandatory but also helps to keep the government running. However, doing so can expose individuals to potential risks, especially when done electronically. Tax-related identity theft can cause significant financial and personal stress, delay tax refunds, and require time and effort to resolve. With more people filing online, the IRS emphasizes the need for enhanced security to ensure taxpayer data remain safe.
In addition to the IRS’s IP PIN program, you can also take additional precautions. Here are some recommendations:
By providing taxpayers with an extra layer of security, the IRS’s IP PIN program helps prevent unauthorized access to sensitive information. Working with a trusted tax professional can help reduce the risk of fraud and identity theft. With an experienced estate planning attorney, you can pursue strategies to reduce the amount of taxable assets you have and help you plan for your future.
For additional reading on keeping your personal and financial information secure, check out the following articles:
You may be afraid of losing your home if you have to enter a nursing home and apply for Medicaid. This fear is well-founded,...
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Read moreIn addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. Coverage in your state may depend on waivers of federal rules.
READ MORETo be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). Special rules apply for the home and other assets.
READ MORESpouses of Medicaid nursing home residents have special protections to keep them from becoming impoverished.
READ MOREIn addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. Coverage in your state may depend on waivers of federal rules.
READ MORETo be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). Special rules apply for the home and other assets.
READ MORESpouses of Medicaid nursing home residents have special protections to keep them from becoming impoverished.
READ MORECareful planning for potentially devastating long-term care costs can help protect your estate, whether for your spouse or for your children.
READ MOREIf steps aren't taken to protect the Medicaid recipient's house from the state’s attempts to recover benefits paid, the house may need to be sold.
READ MOREThere are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home.
READ MORECareful planning for potentially devastating long-term care costs can help protect your estate, whether for your spouse or for your children.
READ MOREIf steps aren't taken to protect the Medicaid recipient's house from the state’s attempts to recover benefits paid, the house may need to be sold.
READ MOREThere are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home.
READ MOREMost states have laws on the books making adult children responsible if their parents can't afford to take care of themselves.
READ MOREApplying for Medicaid is a highly technical and complex process, and bad advice can actually make it more difficult to qualify for benefits.
READ MOREMedicare's coverage of nursing home care is quite limited. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid.
READ MOREMost states have laws on the books making adult children responsible if their parents can't afford to take care of themselves.
READ MOREApplying for Medicaid is a highly technical and complex process, and bad advice can actually make it more difficult to qualify for benefits.
READ MOREMedicare's coverage of nursing home care is quite limited. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid.
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READ MOREDistinguish the key concepts in estate planning, including the will, the trust, probate, the power of attorney, and how to avoid estate taxes.
READ MORELearn about grandparents’ visitation rights and how to avoid tax and public benefit issues when making gifts to grandchildren.
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READ MOREWe need to plan for the possibility that we will become unable to make our own medical decisions. This may take the form of a health care proxy, a medical directive, a living will, or a combination of these.
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READ MOREUnderstand the ins and outs of insurance to cover the high cost of nursing home care, including when to buy it, how much to buy, and which spouse should get the coverage.
READ MOREWe explain the five phases of retirement planning, the difference between a 401(k) and an IRA, types of investments, asset diversification, the required minimum distribution rules, and more.
READ MOREFind out how to choose a nursing home or assisted living facility, when to fight a discharge, the rights of nursing home residents, all about reverse mortgages, and more.
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READ MORELearn how a special needs trust can preserve assets for a person with disabilities without jeopardizing Medicaid and SSI, and how to plan for when caregivers are gone.
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