The advantage of purchasing a partnership Long-Term Care Insurance ("LTCI") policy is that if the insured exhausts all of his or her available coverage, he or she can apply for Medicaid benefits and exclude countable resources equal to the amount paid for care by the LTCI coverage. For example, assume that Alice Smith has a partnership LTCI policy which pays out $350,000 in benefits. The partnership LTCI policy is totally used up. If Alice is in a nursing home when the event ...
IRC Section 72(e)(4)(C) provides that if an individual who holds a non-qualified annuity contract transfers it without full and adequate consideration, such individual shall be taxed on an amount equal to the excess of the cash surrender value of such contract.
An exception to this recognition rule exists for the transfer of an annuity to a spouse. The distribution of an annuity contract from a nongrantor trust to a trust beneficiary normally would not trigger the above recognitio ...
