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Client: Hi I just did something big without checking with you first. Can you fix it? Pro: Not now.

The Audit Techniques Guide for Clergy lumps SocSec, Medicare, and Medicaid into the same category when describing the exemption. And since Medicaid is a part of SocSec, that would lead me to believe it affects the minister's eligibility. However, I could be wrong on that and I can't imagine the minster's decision would automatically affect his/her family. Also, even ministers who have filed Form 4361 cannot exempt themselves entirely. Any non-ministerial income they receive is still subject to SocSec tax and they will be entitled to SocSec benefits upon reaching retirement age. None of this addresses the fundamental question, which is that by filing Form 4361 the minister is saying he/she is opposed to any form of governmental assistance/insurance. It isn't a financial decision - it is supposed to be a decision based on principle and conviction. So if the filing of the exemption is genuine, then the issue of requesting Medicaid assistance should never arise. Interesting question, though.

I went back and re-read the 4361. It actually states that the applicant objects to any form of government assistance for death, disability, old age, retirement, medical expenses, etc, (a list which just happens to include Social Security). So that slams the door shut on Medicaid for the applicant with respect to the declaration. And anyone who submits the form for financial reasons or any other reason is committing perjury. But as KC pointed out, that doesn't mean our government actually pays any attention to things like this when handing out the money. http://www.irs.gov/pub/irs-pdf/f4361.pdf

​ I agree that your client is referring to a 1031 exchange, and those have strict rules that must be followed as outlined in the IRS link provided in BHoffman's post.. If he took possession of the cash at sale, that would be a disqualifying event that would trigger gain recognition. Sec 1031 transactions use either a Qualified Intermediary or an Exchange Facilitator that receives the cash at sale, and the individual himself cannot act in this capacity.

I had a similar problem with an anti-virus program doing some kind of background downloads or something. The computer would just slow to a crawl until it finished. Maybe something like that is happening on your system. On my new computer (quad-core with SSD) I haven't had any speed issues.

I pulled this quote off the web. "The law itself asks the bureaucracies to do something that's basically impossible," said Holtz-Eakin. "Find every American, determine their income. Given their income, determine the subsidy for which they're eligible, send that subsidy in advance every month to the exchange in the state of their residence, and to the insurance plan of their choice." That says it all. Tom Newark, CA