Can I qualify for Medi-Cal if I have significant assets in my IRA?
Individual Retirement Accounts (IRAs) and other retirement plans like 401(k)s should form an integral part of planning for your financial future. Qualified plans, which include all plans found within Section 401(a) of the Tax Code, are eligible to receive tax benefits. Qualified plans are favored by employers because employers can deduct contributions made to employees. IRAs further provide great benefit to employees, allowing you to set aside funds for when you retire which may not impact your eligibility for state and federal benefits. Our Orange County elder law lawyers explore IRAs and Medi-Cal eligibility below.
Benefits of an IRA
Most employees will have the option to contribute a percentage of their wages to an IRA or another qualified savings plan. Some employers offer matching, which can greatly increase the
Upon your death, assets within the IRA will avoid probate. You will select an individual whom you want to receive the proceeds from the IRA. These assets will avoid the expense and time delay of probate. Assets left to your children can continue to grow, with your children having the ability to take distributions. As such, an IRA is an important part of most estate plans.
IRAs and Medi-Cal Eligibility
IRAs are additionally useful when it comes to elder planning. Elder law refers to planning for your retirement years, with the main focus on protecting your assets from nursing home costs. Nursing home expenses are often astronomical, potentially bankrupting even those with significant assets. In California, most elderly individuals will need to qualify for Medi-Cal to cover nursing home costs.
Medi-Cal is California’s Medicaid program, offering