Possible Changes in Medicare Costs IN 2016

Although the Centers for Medicare and Medicaid Services (CMS) has not yet announced changes for 2016, the following might be expected, based on preliminary information released:

Monthly Medicare premium – The standard Part B premium of $104.90, which has not changed the past three years, is likely to increase in January 2016 for many beneficiaries.  It is still possible for the Secretary of the U.S Department of Health and Human Services to intervene to temper the increases.  If that does not happen, Medicare premiums could look like this, based on current reports:

  • Beneficiaries receiving Social Security retirement benefits – $104.90 (no change, since retirement benefits are projected to include no cost-of-living increase).
  • Beneficiaries not receiving Social Security retirement benefits and with Modified Adjusted Gross Income (MAGI) below $85,000 for single tax filers and below $170,000 for joint filers – $159.30, a 52% increase.
  • Beneficiaries with MAGI above these thresholds – between $233.00 and $509.80, including Income-Related Monthly Adjustment Amount (IRMAA), compared to a range of $146.90 to $335.70 in 2015. There could also be increases in the IRMAA for Part D.

Part B deductible – Also unchanged the past three years, the current deductible of $147 may increase, but no announcement has been made.  Of course, beneficiaries enrolled in Medicare Advantage and many Medicare Supplement plans would not be subject to payment of this amount.  However, it would undoubtedly be reflected in increased Medicare Supplement premium rates upon renewal.

Part A out-of-pocket costs for inpatient care – These costs – currently $1,260 per stay of 1-60 days, $315 per day for days 61-90, and $630 per day for each of 30 lifetime reserve days – typically rise by modest amounts each year and will likely increase in 2016.

Part D coverage gap – The amount of drug cost that sends a beneficiary into the coverage gap and the amount of out-of-pocket cost at which the beneficiary leaves the gap will both rise in 2016.  The percentage of the cost of generics while in the gap will slightly decrease, and the copay amounts paid for both brands and generics once out of the gap will slightly increase.

 

Tips On Proving Your Social Security Disability Case

1. Get your medical records! You should always obtain any and all of your medical records from all providers including doctors, hospitals, physical therapy, medical testing, and prescription drugs and treatment. You should never assume that the Social Security Administration will get these for you. Make sure you are organized and follow up on securing these records.

2. Use your doctor! Find a doctor that will support your claim. It is preferred that this be your regular treating doctor. However, if your own treating doctor does not cooperate for any reason, you should seek out a consultation from other doctors to support your claim. If you do have a doctor’s report, make sure that they give a detailed statement at to why your are disabled and cannot work. You should also have them fill out a Social Security Residual Functional Capacity Form.

3. Keep those appointments! If you have ongoing disability and medical problems, you should regularly see a doctor. Many times claimants stop getting regular medical treatment for long periods of time because they believe they have reached maximum medical improvement and there isn’t much more that can be done to assist them. This can create problems with the claim because of the long gaps in documentation about the claimant’s medical condition. So, make sure you see your doctor or doctors regularly.

If you have any questions on disability benefits, you should seek an experienced Social Security attorney. Kent S. DeJean

Do I need an appraisal in a Louisiana succession?

Guessing as to the valuation of real estate in Louisiana is not a good idea for several reasons.

  • Heirs and legatees are required to file a detailed descriptive list in the succession proceedings. In the detailed descriptive list, the heirs and legatees take an oath that the list is complete and accurate. Therefore, valuations must be accurate. If the heirs and legatees knowingly give inaccurate valuations of assets, they may be guilty of contempt.
  • Valuing real estate too low can also have adverse tax consequences. Should the value of the real estate be too low and later sold at a higher accurate value, the heirs and legatees may be subject to increased capital gains taxes. The rate of taxation for capital gains is significant.

If you are unsure as to the value of real estate, it is recommended that you spend more time, effort and money on getting an appraisal. The relatively small amount of money that you spend on an appraisal may pale in comparison to what you may owe in capital gains taxes if you are wrong.

Should you have any questions about succession, you should consult an experienced estate planning attorney.

Kent S. DeJean

Beanie Babies tycoon in big tax trouble

H. Ty Warner, creator of Ty Beanie Babies, is in pretty deep with the IRS.  The primary figure in a fad that took the 90’s by storm is facing a fine of about $53 million, along with possible jail time, for alleged tax evasion.  For more information, see the Daily Beast.

Who needs a Power of Attorney?

Powers of attorney (referred to as a “mandate” under Louisiana law) are important legal documents that allow persons you appoint to manage your finances and make decisions over your person such as medical care in the event that you lose capacity.

Most people thing that older people or people with health issues are the only persons that need to execute powers of attorney. When I am asked who should have a power of attorney, many are surprised at my response. Any person that is eighteen (18) years or older should have an powers of attorney for their property (financial) and for their person (medical).

No adult regardless of age or their health can guarantee that they will have capacity next year, next month or even next minute. To save family time, money and effort, every person over the age of eighteen (18) has a responsibility to make sure that they execute valid powers of attorney to make their preferences known.

There is an old saying, “an ounce of prevention is worth a pound of cure”. Executing a power of attorney can save substantial expenses in attorneys fees and costs to institute an interdiction proceeding if you don’t have a power of attorney. It can also save your family the emotional trauma and effort to have to litigate interdiction.

Should you have any questions about powers of attorney, you should consult an experienced estate planning attorney.

Kent S. DeJean

Does a child’s preference dictate who gets custody?

Under Louisiana law, a child’s preference does not automatically determine which parent gets custody. The child’s preference is one of several factors that the court is required to use in making a determination of custody. The weight given to the child’s preference will vary significantly from case to case depending on the facts.

The older the child, the more weight will be given to that child’s preference. Obviously, a seventeen (17) year old child’s preference will have more weight than a seven (7) year old’s preference.

The maturity of a child and how they are able to present and articulate their preference also determines the weight given to their preference.

The other facts of the case will also determine how much weight is given to the child’s preference. I have often heard judges say that no minor child is going to dictate what is in their best interests. Children do have agendas. Many children like the parent that has the least number of rules and lets the children do as they please. So, if the child’s preference is in line with their best interest, the child’s preference will be more credible and given more weight.

Another factor that determines the weight of a child’s preference is the judge. There are some judges that are more open to the wishes and desires of a child than other judges.

If you have any questions concerning custody, you should consult an experienced divorce attorney.

Kent S. DeJean

Online application for Social Security benefits

Want to avoid the travel and waiting time to go into a local Social Security office to apply for disability benefits? Applications for Social Security disability benefits can be made online.  To complete the application process, you will review an Adult Disability Checklist and complete three forms:

  • A Disability Benefit Application;
  • An Adult or Child Disability Report; and
  • An Authorization to Disclose Information to the Social Security Administration.

The website where you can apply can be found here.

As with any online application, you should either go to the local Social Security Office or call their designated 800 phone number if you have any questions, think there is a problem or there has been an unreasonably long delay.

Should you have any questions about Social Security benefits, you should consult an experienced Social Security attorney.

Medicare spending slowdown

The Congressional Budget Office (CBO) is unable to explain a recent decline in Medicare costs.  According to the CBO’s report, however, the Great Recession was not the cause in Medicare spending slowdown.  It states that spending on Medicare increased by 7.1% from 2000 to 2005, then dropped by 3.8% from 2007 to 2010.  Hospital inpatient spending growth was cut by more than half during that time to 1.7%, and hospice spending increased slowed drastically to 2.3%, less than one-sixth of their previous rates.  Physician services and outpatient care hikes were more muted.

According to the report, the CBO does not believe that the decline in home values, significant losses, financial assets and slower growth in income caused the elderly to use less medical services.

Read more at the Wall Street Journal’s MarketWatch.

IRS attacks conservation easements

Conservation easements have been a recently popular estate planning tool for large tracts of land.  By giving an interest in the land to the state or federal government for conservation purposes, the current value of the property is significantly lowered so that the transfer taxes are minimal.

However, valuation issues have been keeping the IRS busy.  Hundreds of these cases are pending before the Tax Court, and many returns with façade and conservation easement contributions are being audited.

In particular, IRS Agents are looking at whether donors are meeting the stringent requirements and substantiation rules for qualified appraisals.

Adapted from The Kiplinger Tax Letter, Vol. 88, No. 6.  

Coming soon: State tax amnesty

Brian J. Munson | Attorney at Law | LLM in Taxation

The Louisiana Department of Revenue (LDR) announced that a new tax amnesty program will run from Sept. 23 to Nov. 22, 2013, called “Fresh Start.”  The program is designed to entice an estimated 300,000 delinquent taxpayers (who owe about $700 million).  LDR said there could be more, and the agency is still trying to determine the potential tax pool, because some are still in litigation and audits.

During the 2 month period, Louisiana taxpayers will be able to apply for tax amnesty and submit payment for all tax periods that are outstanding.  The benefit is that half the interest and all penalties will be waived, providing substantial savings to taxpayers.

All taxpayers who qualify for Fresh Start will receive a letter from the LDR accompanied by a voucher showing the amounts owed with account numbers to expedite payment by Nov. 22.

Electronic application and payment will be the fastest and most efficient means to take advantage of this opportunity. Should taxpayers decide to pay via check, they will be able to simply mail the voucher with their full payment.

However, be cautious.  LDR makes mistakes and you may not owe what they say you owe.  You should seek advice from a tax professional before simply making a payment.

The fastest way to get the information needed is to access a special website www.ldrtaxamnesty.com and follow the prompts.  Currently, the website provides information only, but a more enhanced website will be unveiled on Sept. 9.

All types of taxes are included.

  • The tax amnesty program shall apply to all taxes administered by LDR, except for motor fuel taxes and penalties for failure to submit information reports that are not based on an underpayment of tax.
  • Taxes due prior to Jan. 1, 2013, for which the department has issued an individual or a business proposed assessment, notice of assessment, bill, notice, or demand for payment not later than May 31, 2013;
  • Taxes for taxable periods that began before Jan. 1, 2013.

A less generous program will occur for a month in 2014 and 2015, so it is best to take advantage of this opportunity now.  Our tax attorneys offer free consultations and can help you determine what you owe.