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From the Financial Hotline

By: Financial Hotline
Spring 2018 (Vol. 36, No. 1)

Call, fax or e-mail for answers to all your financial questions.

Q: Where can I get more info on Social Security’s Ticket to Work program?

A: Social Security’s Ticket program supports career development for people ages 18 through 64 who receive Social Security disability benefits (SSI or SSDI) and want to work. The Ticket program is free and voluntary. It helps people with disabilities move toward financial independence and connects them with the services and support they need to succeed in the workforce.

You can call the Ticket to Work Help Line at 866-968-7842 or 866-833-2967 (TTY) Monday through Friday, 8 a.m. to 8 p.m. ET. Ask a representative to send you a list of service providers or find providers on your own with the Find Help tool online at Federal officials gave states the green light Thursday to impose work requirements on Medicaid recipients as a condition of their receiving benefits.

Q: Are Medicaid recipients now required to have a job?

A: In January of this year, the Centers for Medicare and Medicaid Services (CMS) gave the option to states to apply for permission for this first-ever work requirement in the 52-year history of Medicaid.

Under the new policy, states could ask adults who are able to work to get a job, go to school, get job training or volunteer in the community. The emphasis is “able” to work. The elderly, disabled, pregnant women, children and those unable to work due to extenuating circumstances would be exempt.

The consensus is that working and getting involved in community activities may improve the health of Medicaid recipients. Further, there are already similar work requirements for other welfare programs and in the Supplemental Nutrition Assistance Program (SNAP) also known as food stamps.

To date, several states have applied to take advantage of this policy change and institute work requirements including Arizona, Arkansas, Indiana, Kansas, Kentucky, Maine, New Hampshire, North Carolina, Utah, and Wisconsin.

Q: My wife and I are going through a divorce. I have agreed to relinquish ownership of our residence by giving her a Quit Claim Deed. How do I remove my name from the mortgage?

A: Unfortunately, you can take your name off the deed but only the lender can take you off the mortgage. Therefore, you will need to contact the lender and ask them what they require to remove you from the obligation of repaying the loan. Probably, the lender will require the loan to be paid in full or, your wife may choose to refinance the loan on her if she meets the income and credit requirements. Another option is to sell the home to pay off the loan.

Q: I was in the hospital in 2017 and missed taking my Required Minimum Distribution (RMD). I did take the withdrawal in February, 2018. Is there any way to avoid the penalty?

A: The IRS penalty for failing to meet your RMD in a given year is 50% of the shortfall. You did the right thing taking the RMD as soon as you realized the mistake. The IRS will waive all or part of the penalty if the owner of the IRA or other affected retirement savings plan shows that the late or insufficient RMD resulted from an error or extenuating circumstances and you present a plan to remedy the error. You will need to complete lines 50 to 53 of Form 5329 as instructed and a letter of explanation. You may enter the amount of the 50 percent tax you want the IRS to waive, but you must pay any remaining tax that applies. Then attach the letter of explanation with your Form 5329 to your tax return (Form 1040) requesting a waiver, do not pay the excess accumulation penalty up front. Instead, follow the instructions for requesting a waiver in the Instructions for Form 5329. If the IRS does not honor your waiver request, you will be notified.