Many people who have policies with Prudential Insurance Company will be offered the opportunity to hold shares in the new Prudential when it goes public later this year. They will also be able to get the cash equivalent of the values of their shares.
Anyone who prefers to take the cash should know that the amount they receive will be considered a capital gain and will be subject to tax. Even more important, the amount will be considered income by the New Jersey Pharmaceutical Assistance to the Aged and Disabled (PAAD) program and may make recipients ineligible for assistance for the year in which the cash is received.
My advice to anyone who receives an offer from Prudential is to talk with a trusted financial advisor to determine the impact of each alternative. Despite repeated requests from advocates for seniors, PAAD at this time has no intention of informing recipients they may have a problem.
I'll keep urging PAAD administrators to notify the recipients, but in the meantime, I want to alert everyone in advance to watch for mailings from Prudential and accept only the offer which has no adverse impact on their eligibility for assistance.
Joan M. Quigley
Assemblywoman, 32nd District