FAQ-Elder Planning Income Concepts, LLC

The use of income producing property is new to many elder law practitioners, particularly the hassle-free, turn-key method of owning rental real estate offered by EPIC.

We hope these answers help you! If you don't find the answer you're looking for, please contact us!

What is EPIC?

Elder Planning Income Concepts, LLC (EPIC) is a limited liability company owned and operated by two Florida Board Certified Elder Law Attorneys, David Midgett and Emma Hemness.  We are experts in public assistance benefits. 

EPIC offers a planning option for asset protection in the Medicaid context.  EPIC offers a unique package of services, including the purchase, leasing, management and sale of income producing real estate.  We help other elder law attorneys help their clients.

Click <HERE> for more info about us.

Who Should Use EPIC?

EPIC works with other Florida elder law attorneys, particularly those looking for medicaid asset protection solutions for their clients.  EPIC does not work with the general public- just attorneys.  Any elder law attorney in Florida who seeks to protect client assets in the Medicaid planning context should consider EPIC.

Why Use EPIC?

EPIC removes the hassle of property ownership.  We take care of finding the property, finding the tenant, paying the taxes, maintenance and insurance, and taking care of the sale of the property upon the client's death.  All of this is done in an arms-length transaction, with the elder law attorney representing the client.  EPIC does not represent your client--you do.

EPIC is run by Board Certified Elder Law attorneys. While we are certified experts in medicaid issues, EPIC's principals are also experienced real estate investors, licensed in real estate and actively involved in the title insurance industry.  Nobody offers our combination of experience and expertise in elder law and real estate.

How Does EPIC work?

EPIC finds a suitable property for your client.  We arrange to buy the property in your client's name, and then EPIC leases the property back from your client (and we in turn sublease to the ultimate tenant).  We pay your client fair market rent, based on the type, location, size and age of the property.  Your client has effectively and legally turned assets into an income stream.

Upon your client's death, EPIC pays your client's trust a pre-determined, guaranteed amount to repurchase the property.  Your client's heirs know in advance exactly how much will be returned after death.

Click <HERE> for a more in-depth explanation.

How does Real Estate help with Medicaid Benefits?

Both Federal law and Florida DCAF policies make it clear that real estate is treated as income if it produces rent at fair market value.  EPIC ensures that your client receives a fixed, net rental income each month, based on fair market value for the property.  Your client is immediately eligible under the Medicaid asset tests, and remains eligible.  The value of the real estate is returned to your client's trust after death, because EPIC contractually agrees to repurchase the property at a fixed price.

How Secure is my Client's Investment?

Your client owns the real estate--EPIC is just leasing the property.  And the property is income-producing (commercial, retail, professional offices, multi-family residential, vacation homes, etc.), regardless of whether EPIC is involved or not.  Your client is not buying stock, securities or insurance policies--they are getting a deed to rental real estate.  Property ownership is one of the most secure investments available today.

What Types of Properties Does EPIC Use?

EPIC utilizes all types of income producing real estate.  This includes residential properties, such as single family homes, duplexes, quadraplexes, vacation homes and condominiums.  We also utilize commercial property, such as professional offices, retail buildings, and apartment complexes.  EPIC does not generally use vacant land (insufficient income) or industrial land (potential liability).  All properties used by EPIC must produce income consistent with their fair market value

What are "Triple Net" Leases?

A "Triple-Net" Lease (shorthand "NNN") is a lease where the tenant is responsible for paying all taxes, insurance and maintenance of the property.  The landlord receives a payment that is "net" of all property related expenses-- in other words the tenant pays all expenses and the landlord gets a fixed rental amount

Does EPIC Use Triple Net Leases?.

EPIC exclusively uses triple-net leases as a part of its program.  All clients purchasing property through EPIC will lease the property to EPIC for a guaranteed, net monthly rental amount.  EPIC will be responsible for paying all taxes, insurance, and maintenance.  The owner of the property (the elder law attorney's client) receives a "net", fixed monthly rental amount.  This simplifies the medicaid application and eliminates fluctuations in income.

How Much Will My Client Make with EPIC?

The rent paid to your client will always be fair market value for the property.  The exact amount will depend on the type of property available at the time your client invests, the amount of time before eligibility is required, and prevailing market rates.

Thusfar, all EPIC cases have involved rent that pays the client at least 3.5% annual return on their investment, which is better than prevailing CD rates.  Obviously this amount is subject to change, but your client's will enjoy a reasonable, fair market return of income on their investment.

How Does EPIC Charge?

EPIC charges a flat administrative fee of $1,000 for each client, paid on the closing statement at the time the client purchases the property.

EPIC then pays a net rental amount to the client based on the fair market value for the particular property.  EPIC calculates this net rental based on the potential sub-lease rent, taking into consideration expenses such as taxes, insurance, maintenance, vacancy set-asides and management costs.  However, EPIC bears the risk of not getting paid--your client gets the same rent check each month regardless of whether or not the occupant pays, and regardless of the expenses.  Your client will receive a fixed, net rental payment with no deductions or expenses.

EPIC then guarantees a repurchase of the property upon your client's death.  The amount of that repurchase varies on a case by case basis, but can be as much as 100% of the original investment.

What Happens When My Client Dies?

EPIC will re-purchase the ownership interest from your client's successor trustee within 6 months of your client's death.  EPIC strongly recommends your client hold title to the property in a revocable living trust or simple land trust, to avoid probate and the issues of estate recovery attendant with probate.

The amount of the guaranteed repurchase is determined by the initial contract between EPIC and the Client.  The amount will vary by case, but can be as much as 100% of the initial investment.  Your client's trust will name beneficiaries to receive the net sale proceeds.

Why Does EPIC Encourage Trusts?

EPIC strongly encourages elder law attorneys to recommend trusts to their clients for owning income-producing property.  EPIC is willing to work with investors who cannot or do not want to use a trust; however, without a trust, the sales proceeds after the investor's death would be subject to probate and potential claims of estate creditors.  Therefore a trust provides better asset preservation for the elder law attorney's client.

EPIC prefers using simple Florida land trusts.  Land trusts are created pursuant to Florida Statute Section 689.071, and provide for straight forward ownership of real estate.  Land trusts are grantor-trusts that do not require the recording of the trust or a memorandum of trust in the public records, thereby affording more privacy than a revocable living trust.  Upon the investor's death, EPIC simply purchases the property from the land trust's successor trustee, for an amount agreed to in advance.  The trustee then distributes the proceeds to the trust's beneficiaries

Click Here for a sample Florida Land Trust

Can my Client Do This on Their Own?

Absolutely.  If your client is comfortable buying a property on their own, finding a tenant, collecting rent, paying the expenses, dealing with vacancies and rent fluctuations, and selling the property at death, then your client does not need EPIC.

EPIC simply removes those hassles.  EPIC is ideal for those clients lacking the experience, expertise, time or desire to deal with the hassles of owning income-producing property.

How Long Does it Take?

To get started, the elder law attorney completes and submits a confidential  Request for Services form.  EPIC then prepares basic contract documents for your client's signature.  Once the documents are returned with a check payable to the closing title company, the closing is generally completed and the first rent check issued within 30 days.

What Documents are Provided By EPIC?

EPIC and the title company prepare all the necessary documents, including a contract, lease, closing statement, deeds, affidavits, trust documents, etc.  EPIC also provides an independent Broker Opinion on Value, attesting to the fair market value of the rent payment.  In short, the elder law attorney is provided all documents needed to apply for public benefits.

What are the Benefits for My Client?

First, EPIC lets your client access Medicaid ICP assistance, securing a lower, government negotiated cost of care.  If your client is the applicant, the higher income may allow your client to find a better facility.  If your client is an at-home spouse, EPIC's net rental income is better than rates of return offered in annuities or CDs, with no state payback requirement.  And if Florida ever implements expanded estate recovery, the higher patient payment will reduce any resulting medicaid lien.  Finally, EPIC provides a guaranteed purchase price upon your client's death, thereby protecting and preserving your client's legacy for the next generation.

What are the Benefits for the Elder Law Attorney?

EPIC allows Florida Elder Law Attorneys to continue the noble work they do in protecting and preserving the life savings of clients who face the disastrous costs of long term nursing care.  With recent changes in Federal Law and state policy, the planning techniques previously available to elder law attorneys are under attack.  Income producing property is a bona-fide, legitimate investment that is treated as income instead of an asset.  However, finding and managing real estate is outside the normal scope of an elder law attorney's practice.  EPIC removes the hassle of property ownership for both the lawyer and the client.

With EPIC, the elder law attorney continues to represent the client and give the client customized legal advice.  The elder law attorney charges their normal fees for planning, implementation and application for medicaid.  In addition, the elder law attorney will participate in the closing and the drafting of specialized trusts to take title.  While EPIC assists the elder law attorney with these tasks, the elder law attorney is still representing the client and should bill accordingly.