Estate Tax:  A tax that is levied upon an individual's property at death.  In the years 2004 and 2005, if an individual has less than $1.5 million, his or her estate is not subject to the Federal estate tax (although it may be subject a tax levied by his or her state).

Gift Tax:  A tax that is levied upon an individual who makes a gift to someone else.  An individual is not subject to Federal gift tax if he or she gives a million dollars or les during his or her lifetime.  However, one may be subject to gift tax levied by his or her state (or the recipient may be subject to a state gift tax).  There are Federal exclusions of $11,000 per year per person ($22,000 if you are married and have your spouse's consent) that are not counted in calculating the gift tax.

Guardianship:  A court appoints someone to handle the personal and financial affairs of an individual that the court deems unable to handle his or her own affairs.  This court proceeding can usually be avoided by proper planning (that is, by having durable powers of attorney health care proxies and other planning documents in place).

Health Care Proxy:  Appoints an agent or agents to make your health care decisions if you are unable to make your own decisions.

Living Will:  A document that gives guidance as to what health care decisions you want made if you become incapacitated and are terminally ill, in a permanent vegetative state or otherwise no longer able to enjoy a sufficient quality of life.

Long Term Care Insurance:  Insurance that my be purchased to cover one's long term care needs.  Some examples of what long term care insurance may cover are:  home care services, nursing some care, adult day care and assisted living.


Medicaid:  A Federal program that provides health and long term care to individuals with limited income and resources.  Medicaid is the largest source of payment of nursing home care in the United States.

Medicaid Planning:  Planning that is done to meet the income and resource levels of Medicaid so that the family can preserve assets from the often ruinous cost of long term care.  It is best to plan in advance but Medicaid planning can usually be accomplished even when the individual is on the doorstep of the nursing home (that is, even if transfers were not made three years prior).

Medicare:  A Federal health insurance program for senior citizens over the age of 65, disabled persons who have received disability benefits for 24 months and those with end stage renal (kidney) disease or ALS (Lou Gehrig's Disease).  At this time, there are no financial requirements or limitations with respect to qualifying for Medicare (except for the drug prescription program).

Power of Attorney:  A document that appoints an agent or agents to manage your finances.  You can give your agent as much or as little power over your property as you wish.  If a power of attorney is durable, then it continues to be effective after the principal becomes incompetent.

Social Security Disability (SSD):  Generally speaking, SSD provides a monthly income to those who have worked 5 out of 10 years and are disabled.  Must meet a strict definition of disability to be eligible.

Social Security Income (SSI):  Provides benefits to disabled, blind or aged individuals who are not eligible for social security, SSD or whose SSD benefits do not raise them above the poverty level, and who meet certain income and resource requirements.

Trust:  A trust is a document that tells how property that is placed into it will be managed.  Trusts can be created during lifetime or at death.  There are many reasons why a trust might be created: to avoid probate, to ensure that the trust estate will be used for purposes approved by the creator of the trust or to protect the assets of someone who is disabled, unable to manage money or who may have substantial creditors.

Will:  A will is a document that determines how your estate will pass upon your death.  In your will, you name beneficiaries who will benefit from your estate and an executor who will manage your estate.  You may also set up trusts and name guardians for your children.

(No attempt is being made to give legal, tax or professional advice of any nature.  Consult your personal advisor if you have questions about your individual situation.)

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Michael L. Pfeifer, Esq. contributed this Glossary of Elder Law Terms.  He is an attorney specializing in elder law with offices in Garden City, New York.  His telephone number is (516) 222-1773 and email is mpfeifer@pfeiferlawoffice.com.

Michael is also a member of the MatureResources.org Business Directory.  Please visit his Signature Webpage in our Business Directory ... Law Offices of Michael L. Pfeifer.